Document:

JOINT VENTURE
CONTRACT

 

between

 

Zhangjiagang
Chemical machinery co., ltd.

 

and

 

SES
ASIA TECHNOLOGIES, LTD.

 

for the
Establishment of

 

zcm-ses
Sino-US Clean Energy tECHNOLOGIES CO., lTD.

 

14 FEBRUARY 2014

 

ZHANGJIAGANG,
PEOPLE’S Republic of China

 

    	 

    	 

    

 

TABLE
OF CONTENTS

 

	1.	DEFINITIONS	1
	 	 	 
	2.	PARTIES TO THE CONTRACT	6
	 	 	 
	3.	ESTABLISHMENT OF THE COMPANY	6
	 	 	 
	4.	PURPOSE AND SCOPE OF BUSINESS	7
	 	 	 
	5.	TOTAL AMOUNT OF INVESTMENT AND REGISTERED CAPITAL	8
	 	 	 
	6.	TRANSFER OF EQUITY INTERESTS	10
	 	 	 
	7.	REPRESENTATIONS AND WARRANTIES OF THE PARTIES	11
	 	 	 
	8.	RESPONSIBILITIES OF THE PARTIES	14
	 	 	 
	9.	Environmental PROTECTION	18
	 	 	 
	10.	PURCHASE OF MATERIALS	18
	 	 	 
	11.	Business Development and Operation	18
	 	 	 
	12.	BOARD OF DIRECTORS AND SUPERVISORS	19
	 	 	 
	13.	MANAGEMENT ORGANIZATION	24
	 	 	 
	14.	LABOUR MANAGEMENT	27
	 	 	 
	15.	ANNUAL OPERATING PLANS AND BUDGETS	28
	 	 	 
	16.	TAXATION, THREE FUNDS AND PROFIT DISTRIBUTION	28
	 	 	 
	17.	FINANCIAL AFFAIRS AND ACCOUNTING	30
	 	 	 
	18.	BANK ACCOUNTS AND FOREIGN EXCHANGE	32
	 	 	 
	19.	CONFIDENTIALITY	32
	 	 	 
	20.	DURATION OF THE COMPANY	33
	 	 	 
	21.	EARLY TERMINATION	33
	 	 	 
	22.	LIQUIDATION AND DISSOLUTION	34
	 	 	 
	23.	LIABILITY FOR BREACH OF CONTRACT	35
	 	 	 
	24.	INSURANCE	36
	 	 	 
	25.	FORCE MAJEURE	37
	 	 	 
	26.	APPLICABLE LAW	37
	 	 	 
	27.	DISPUTE RESOLUTION	37
	 	 	 
	28.	MISCELLANEOUS	38

  

    	 

    	 

    

 

JOINT
VENTURE CONTRACT

 

THIS JOINT VENTURE CONTRACT is
entered into on February 14, 2014, in accordance with the Law of the People's Republic of China on Chinese-Foreign Equity Joint
Ventures and the Regulations for the Implementation of the Law of the People's Republic of China on Chinese-Foreign Equity Joint
Ventures (the “Joint Venture Law”), the Provisions for the Contribution of Capital by Parties to Joint Ventures Using
Chinese and Foreign Investment and its supplementary provisions, and other relevant and officially promulgated Chinese laws and
regulations between:

 

Zhangjiagang Chemical
Machinery Co., Ltd., a company limited by shares established and existing under the laws of the PRC whose registered address
is No. 20 Chengyang Road, Houcheng, Jingang Town, Zhangjiagang City, Jiangsu Province, 215631, PRC (“ZCM”).

 

AND

 

SES Asia Technologies, Limited.,
a limited company established and existing under the laws of Hong Kong Special Administrative Region of the PRC whose registered
address is 7/F., Bonham Centre 79-85 Bonham Strand, Sheung Wan (“SESHK”)

 

ZCM and SESHK may hereinafter
be referred to individually as a “Party” or collectively as the “Parties”.

 

WHEREAS, the Parties intend to
establish a Sino-Foreign Equity Joint Venture with the primary objective of:

 

		l	Establishing
                                         the leading gasification technology in China;

 

		l	Generating
                                         significant income and profit for the Parties; and

 

		l	Eventually
                                         listing the Company on the public markets (i.e. Chinese security market, or Hong Kong
                                         security market or other security markets).

 

Considering the above factors and confirming
that the Parties are completely informed, in conformity with the principles of equality and mutual benefit, the Parties hereby
agree as follows:

 

		1.	DEFINITIONS

 

The following terms shall have the meanings
set forth below:

 

“Affiliate”, with respect
to a Party, shall mean any entity directly or indirectly controlling, controlled by or under common control with such Party; an
entity shall be deemed to “control” another entity if the former possesses, directly or indirectly, no less than 50%
voting shares or registered capital, or the power to appoint or elect the majority of directors or the actual control rights of
the latter.

 

    	1

    	 

    

  

“Articles of Association”
shall mean the Articles of Association of the Company dated as of the date hereof between the Parties, and as may be amended
or restated from time to time by the Board.

 

“Basic Engineering Design Package”
or “BEDP” shall mean a package of technical document deliverables prepared, after delivery of the PDP,
for the next step engineering design, which shall comply with the China’s latest industrial standards.

 

“Board” or “Board
of Directors” shall mean the Board of Directors of the Company.

 

“Business License” shall
mean the business license to be issued to the Company by the competent PRC State Administration for Industry and Commerce, including
the business license issuedby the authorities, which may be amended from time to time.

 

“Chairman” shall mean
the chairman of the Board of Directors of the Company.

 

“China” or the “PRC”,
for the purpose of this Contract, shall mean the People's Republic of China.

 

“Company” or the “Joint
Venture” shall mean ZCM-SES Clean Energy Technologies Co., Ltd. or any other name approved by the competent authority,
the equity joint venture company established by the Parties pursuant to the Joint Venture Law, other relevant and officially promulgated
laws and regulations of the PRC, and this Contract.

 

“Confidential Information”
shall mean technology and Know-How as well as trade secrets, strategic business or marketing information, business projections,
secret processes and etc., including but not limited to processes, data, formulae, material balance, control logic, programs,
manuals, designs, sketches, photographs, plans, drawings, specifications, reports, studies, findings, non-patented inventions
and ideas, any data relating to a patent that is not disclosed in a granted patent, and other information relating to the production,
packaging, use, pricing, or sales and distribution, whether of a technical, engineering, operational, business or economic nature,
whenever provided by SESHK (or its Affiliates), or by ZCM (or its Affiliates), in connection with the establishment of the Company
and any matters related thereto, the implementation of and/or the conduct of the business contemplated by this Contract and the
other contracts contemplated herein. Confidential Information, however, shall not include information which is now or hereafter
becomes part of the public domain through authorized publication, or information which the receiving Party can demonstrate was
in its possession, prior to the effectiveness of the Contract, and which was legally obtained and is not in violation of any agreement.

 

“Contract” shall mean
this Joint Venture Contract and the Annexes attached hereto.

 

“Critical Design Parameters”
or “CDP” shall mean key SGT and SGT Proprietary Equipment design parameters for a project on a case-by-case
basis, which are based on a specific basis for design for a project and are fundamental technology parameters required to initiate
the PDP.

 

    	2

    	 

    

 

“Detailed Engineering Design
Package” or “DEDP” shall mean the detailed engineering design package, which is prepared as a follow
up to the BEDP.

 

“Director” shall mean
a member of the Board of Directors.

 

“Effective Date” shall
mean the day on which this Contract becomes effective and approved by the competent examination and approval authority.

 

“Establishment Date”
shall mean the date on which the Business License of the Company is issued.

 

“Examination and Approval Authority”
shall mean the competent authority as is duly authorized by law to approve this Contract.

 

“Force Majeure” shall
mean any (a) acts of God; (b) flood, fire, earthquake or explosion; (c) war, invasion, hostilities (whether war is declared or
not), terrorist threats or acts, riot or other civil unrest; (d) government order or law; (e) actions, embargoes or blockades
in effect on or after the date of this Contract; (f) action by any governmental authority; (g) national or regional emergency;
(h) strikes, labour stoppages or slowdowns or other industrial disturbances; and (i) shortage of adequate power or transportation
facilities.

 

“Foreign Exchange”
shall mean any foreign currency which can be freely exchanged, converted, or traded in the open international currency market.

 

“General Manager” shall
mean the general manager of the Company.

 

“GTI” shall mean the
Gas Technology Institute of the United States.

 

“Improvements” shall
mean any improvements within the SGT (including new inventions and designs) created, invented, developed or discovered by a Party
or the Company after the Establishment Date with respect to the SGT process and SGT Proprietary Equipment.

 

“Joint Venture Term”
shall mean the duration of the Company as provided for in Article 20 hereof.

 

“Labour Contract” shall
mean the individual labour contract to be entered into between the Company and any of its employees, excluding Seconded Personnel.

 

“Management By-laws”
shall mean the Company’s By-laws that are approved at the first Board of Directors Meeting.

 

    	3

    	 

    

 

“Management Personnel”
shall mean the General Manager, Vice General Manager, Chief Financial Officer, Marketing Director, Chief Accountant, Chief
Technology Officer, Chief Mechanical Engineer and such other senior personnel positions that are designated as Management Personnel
positions by the Board from time to time.

 

“Pressurized Fluidized Bed”shall
mean the gasification reactor or system, at any pressure above atmospheric pressure, that converts SGT Feed stock into syngas
by reaction of SGT Feedstock with air, enriched air, or oxygen (with or without the addition of steam, carbon dioxide or other
diluents gases) in a fluidized bed (including bubbling bed and fast fluidized bed) wherein SGT Feedstock is fed and syngas is
produced.

 

“Process Design Package”
or “PDP” shall mean a process design package prepared, on the basis of the existing PDP provided by SESHK,
for a specific customer project for which a PSA has been executed, and which shall comply with China’s latest industrial
standard.

 

“Project Sublicense Agreement”
or “PSA” shall mean the agreement to be entered into by the Company as licensor, from which a technology
license must be obtained from the Company for the normal operation of a Project in the Territory. The form of the PSA as set out
in Annex3 shall be a reference and subject to any necessary changes as requested by the customer, as long as the technology will
be protected during the implementation of such Project.

 

“Renminbi” or “RMB”
shall mean the lawful currency of the PRC.

 

“Seconded Personnel”
shall mean the employees of each Party or of any of its Affiliates, who will be seconded for providing full time services to the
Company. The costs of such Seconded Personnel shall be borne by the Company.

 

“Services”
shall mean any engineering or design services related to the SGT, modularization services, procurement services, construction
management services, plant commissioning and start-up services, plant operations and maintenance services and any other services
beyond this scope that are authorized by a unanimous vote of the Board.

 

“SES Gasification
Technology” or “SGT” shall include the collection of SES Intellectual Property, Know-How, trade secrets
and methods developed by SESHK and its Affiliates for its advanced fluidized bed gasification technology. The SGT has been extensively
developed since 2004 and was initially based upon the U-Gas® technology licensed by SEST and its Affiliates from GTI, and
which has been further developed through additional improvements, Know-How and patents developed by SESHK’s Affiliates through
industry experience of SESHK’s Affiliates from developing, designing and operating projects in China and from designs by
or for SESHK and its Affiliates in their development of projects globally. The SGT is one of the most advanced gasification technologies,
which has been commercialized through the construction and operation of industrial projects to be reliable, environmentally-friendly,
economically feasible, sustainable and in conformity with China’s energy independence policy and energy strategies. SGT
is a part of the equity contribution of SESHK as described in the TUCA. Prior to the Establishment Date, SESHK has full rights
and authorization of the SGT to be contributed to the Company. And any Improvement developed by the Company after the Company
is established belong to the Company, subject to the terms of the TUCA.

 

    	4

    	 

    

 

“SES
Shanghai” shall mean SES New Energy Technologies (Shanghai) Co., Ltd. (埃新斯新能源技术;上海;有限公司).

 

“SEST”
shall mean Synthesis Energy Systems Technologies, LLC, a wholly owned subsidiary of Synthesis Energy Systems, Inc. and the
licensor of the SGT license right to SESHK, which authorizes SESHK as the licensor in the TUCA.

 

“SGT Feedstock” shall
have the meaning as defined in the Technology Usage and Contribution Agreement as set forth in Annex 4.

 

“SGT Know-How/Know-How”
shall mean all commercial and technical information, including trade secrets, pertaining to the SGT, and/or ZCM’s manufacturing
of the SGT proprietary equipment, including, but not limited to, theses, designs, drawings, blueprints, specifications, test data,
charts, fabrication techniques, materials of construction, and formulations, graphs, operating and test procedures, shop practices
and instruction manuals.

 

“SGT Proprietary Equipment”
shall mean the Gasifier Reactor, Gasifier Heat Recovery Steam Generator, Cyclones, Filtration, Bottom Char Cooling and Removal
System, Gasifier Coal Feeding System; Metering/Measuring System; Gasifier Control and Safety System logic etc., subject to adjustment
per the requirements of customer.

 

“Sub-license Royalty To GTI”
shall mean ***% of the license fee to be paid to GTI, pursuant to the legally effective agreement between SEST and GTI, from
the license fee received under any sub-license Project by the Company.

 

“Technology Usage and Contribution
Agreement” or “TUCA” shall mean the authorization agreement for the use of technologies related to
SGT, and agreement related to SGT and performance guarantee as described in TUCA which shall be contributed to the Company as
SESHK’s capital contribution, and which shall be in accordance with Annex 4.

 

“Territory” shall mean
China, Indonesia, the Philippines, Vietnam, Mongolia and Malaysia as set forth in the TUCA.

 

“United States Dollars”
or “US$” shall mean the lawful currency of the United States of America.

 

“Working Personnel” shall
mean all employees of the Company other than Management Personnel and members of the Board.

 

*** This information has been omitted
in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

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“Yima Plant” shall
mean the project/plant operated and managed under the joint ventures of YMCIG-SES New Energy Company Ltd., YMCIG-SES Methanol
Products Company Ltd. and YMCIG-SES New Gas Company Ltd.

 

“ZZ Plant” shall mean
the project/plant operated and managed under the joint venture of SES (Zaozhuang) New Gas Company Ltd., a company under super
majority control of Synthesis Energy Systems, Inc.

 

		2.	PARTIES TO THE CONTRACT

 

The Parties to this Contract
are as follows:

 

		(a)	ZCM, a duly incorporated
                                         company with its registered office address at No. 20 Chengyang Road, Houcheng, Jingang
                                         Town, Zhangjiagang City, Jiangsu Province, 215631, PRC

 

The legal representative of
ZCM is:

 

Name: CHEN, Yuzhong

 

Position: Chairman

 

Nationality: Chinese

 

		(b)	SESHK, a duly incorporated
                                         company under the laws of Hong Kong Special Administrative Region with its registered
                                         office address at 7/F., Bonham Centre 79-85 Bonham Strand, Sheung Wan.

 

The duly authorized representative
of SESHK is:

 

		Name:	ROBERT WAYNE
                                         RIGDON

 

		Position:	PRESIDENT

 

		Nationality:	USA

 

		3.	ESTABLISHMENT OF THE COMPANY

 

		3.1	Establishment of the Company

 

In accordance with the Joint
Venture Law and other relevant and officially promulgated PRC laws and regulations, the Parties hereby agree to establish the
Company pursuant to the terms of this Contract. The Company shall be a legal person under the laws of the PRC subject to the protection
and jurisdiction of PRC law.

 

    	6

    	 

    

 

		3.2	Name and address of the Company

 

The name of the Company shall
be ZCM-SES Sino – US Clean Energy Technologies Co., Ltd. in English and 张化机综能中美
清洁能源技术有限公司 in Chinese, or other name as approved
by the competent authority.

 

The legal address of the Company
shall be in Zhangjiagang, and subject to the final address specified in the business license.

 

		3.3	Limited Liability Company

 

The Company shall be a limited
liability company established in accordance with the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures
and the Regulations for the Implementation of the Law of the People's Republic of China on Chinese-Foreign Equity Joint Ventures,
the Provisions for the Contribution of Capital by Parties to Joint Ventures Using Chinese and Foreign Investment and its supplementary
provisions, and other relevant and officially promulgated Chinese laws and regulations.

 

		3.4	No Agency Relationship

 

Neither Party is the agent
of the other Party nor does either Party have any power to bind the other Party or to assume or to create any obligation or responsibility,
express or implied, on behalf of the other Party in the other Party's name. Neither this Contract nor any of the other agreements
contemplated herein shall be construed as constituting a partnership between ZCM and SESHK or as creating any other form of legal
association which would impose liability upon one Party for the act or failure to act of the other.

 

		4.	PURPOSE AND SCOPE OF BUSINESS

 

		4.1	The Purpose of the Company

 

With the desire to strengthen
the economic and technical cooperation between the Parties, the purpose of the Company will be to use advanced and available techniques
and scientific management methods to improve the SGT, develop new products, and enable competitiveness in quality and price in
the international market; to be compatible with the needs of the Chinese clean coal chemical development, and to satisfy the gradually
increasing market demand for clean energy; enable economical and clean conversion of SGT Feedstock into syngas for the production
of a variety of high value products such as chemicals, power, transportation fuels, direct reduced iron (DRI) steel, fertilizers,
synthetic natural gas (SNG) and industrial fuels through the efficient collaboration of ZCM which, has a strong capability in
coal chemical equipment manufacturing, engineering and related services in China, and SESHK’s advanced SGT which has been
utilized in industrial gasification projects. The Company aims to make the SGT the primary gasification technology in the Territory,
through its scientific business management.

 

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		4.2	The Business Scope of the Company

 

The business scope of the
Company is to obtain full exclusive authorization in the Territory to provide SGT and related technologies, engineering services
and SGT sub-licensing rights, engineering design of the SGT, supply related technologies and supply SGT Proprietary Equipment,
to manufacture and sell SGT Proprietary Equipment, toprovide SGT EPC project services, and to develop and improve the scope, pressure
and capacity of the SGT, etc. The business scope shall be subject to the business scope as shown on Business License.

 

		5.	TOTAL AMOUNT OF INVESTMENT AND REGISTERED
                                         CAPITAL

 

		5.1	Total Amount of Investment

 

The total investment for the
Company shall be RMB153,800,000 (in words: RenminbiOne Hundred Fifty-Three Million Eight Hundred Thousand).

 

		5.2	Registered Capital and Capital Contribution

 

The registered capital of
the Company shall be RMB 153,800,000(in words: Renminbi One Hundred Fifty-Three Million Eight Hundred Thousand) and shall be contributed
by the Parties in the following proportions:

 

		(a)	ZCM shall contribute cash in
                                         the amount of RMB 100,000,000 (in words: Renminbi One Hundred Million) to the registered
                                         capital of the Company, representing sixty-five (65%) percent of the total registered
                                         capital of the Company.

 

		(b)	SESHK shall contribute the
                                         terms and conditions of the Technology Usage and Contribution Agreement, which, according
                                         to the appraisal report (Ping Bao Zi [2014] 1002, as attached in Annex 5) issued by Beijing
                                         Guangfulidao Assets Appraisal Co., Ltd., an assets appraisal company mutually agreed
                                         by the Parties, has a value equal to RMB 53,800,000 (in words: Renminbi Fifty-Three Million
                                         Eight Hundred Thousand) as its capital contribution to the Company, representing thirty-five
                                         percent (35%) of the total registered capital of the Company.

 

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		5.3	Additional Financing

 

In accordance with Article
12.6, the Company may obtain additional funds through loans from domestic or foreign financial institutions on terms and conditions
approved by the Board of Directors and the Parties. The Company may also obtain loans or guarantees from the Parties or their
Affiliates on terms and conditions to be determined by the relevant parties; provided, however, that no Party shall be obligated
to lend funds to the Company or to guarantee a loan to the Company from a third party or financial institution
or if a guarantee is required, each Party shall, in principle, undertake its share in such guarantee in a proportion equal
to its Equity Interest in the Company. In the event that a Party does agree to lend funds to the Company or to guarantee a loan
to the Company from a third party or financial institution, such Party shall be entitled to be paid interest on the loan at such
rate or guarantee fees in such amount that such Party would have been entitled to be paid as if such Party were not a party to
this Contract and as if the transaction were a negotiated arm's length financing from a third party. The Company may mortgage
or otherwise grant a security interest in its assets, as permitted by law, to be mortgaged or secured in order to obtain loans.

 

		5.4	Timing of Capital Contributions

 

ZCM shall make the initial
capital contribution to the Company with thirty (30) days upon issuance of the Business License, in an amount not less than RMB
53,800,000, while ZCM shall make the remaining capital contribution to the Company within two (2) years. However, if at any time
during such two (2) year period the Company’s cash balance drops below a level where the Company has less than enough cash
to cover eighteen (18) months of operations (based on the last budget as approved by the Board and not including any borrowings
by the Company), then ZCM shall be obliged to inject all of its remaining registered capital to the Company.

 

SESHK shall make its capital
contribution to the Company within thirty (30) days upon issuance of the Business License.

 

		5.5	In case any Party fails to make its
                                         capital contributions as agreed in above Article 5.4, the breaching Party shall pay damages
                                         to the non-breaching Party (or the Company).

 

		5.6	Capital Contribution Certificate

 

Within thirty (30) days after
the Parties have made their capital contributions, the Company shall engage an independent accountant registered in China to verify
such contributions, with verification expenses borne separately by the Parties.

 

Upon the issuance of a verification
report by such accountant, the Company shall issue to each contributing party an interim capital contribution certificate signed
by the Chairman evidencing that the contribution was made. The Company may issue such interim capital contribution certificates
from time to time as ZCM makes further capital contributions, which have been verified by the accountant within thirty (30) days
of each contribution. Thirty (30) days after the entire registered capital of the Company has been contributed by ZCM, the Company
shall request that an accountant registered in China verify each Party's total contributions and issue a final certificate of
verification. Upon receipt of the final certificate of verification from the independent accountant, the Company shall promptly
issue a final capital contribution certificate to each Party setting forth the aggregate amount of such Party's contribution(s).
Upon the issuance of the final capital contribution certificate(s), such Party shall surrender to the Company for cancellation
all of the interim capital contribution certificates signed by the Chairman.

 

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		5.7	Increase or Reduction of Registered
                                         Capital

 

Any increase or reduction in
the registered capital of the Company shall be approved by the Board of Directors and submitted to the competent Examination and
Approval Authorities for approval. Upon receipt of such approval, the Company shall register the increase or reduction in the
registered capital with the appropriate administration for industry and commerce.

 

		6.	TRANSFER OF EQUITY INTERESTS

 

		6.1	Encumbrance of the Investment

 

Except as otherwise contemplated
in this Contract, neither Party may mortgage, pledge, charge or otherwise encumber its equity interests in the Company, its rights
and obligations under this Contract and other interests in the Company (“Equity Interests”) without the prior
written consent of the other Party, which shall not be unreasonably withheld.

 

		6.2	Valuation

 

Any Party who desires to sell
or otherwise transfer its Equity Interests in the Company shall bear the cost of any valuation of the Company as an on-going concern.
The Parties shall render all assistance and provide all such documentation and other information to the appraiser as such appraiser
may consider necessary.

 

		6.3	Transfer of Equity Interests

 

		(a)	During the period from the
                                         Establishment Date until thirty (30) days after the first PSA is executed by both the
                                         Company and the customer for a Project and the first payment of license fee has been
                                         received, SESHK has the pre-emptive right to sell five percent (5%) of its Equity Interests
                                         to a financial investor mutually agreed by the Parties, and ZCM agrees to such transfer.
                                         If SESHK fails to sell such Equity Interests, ZCM shall have the option to purchase from
                                         SESHK five percent (5%) of its Equity Interest at the price of RMB 10,000,000 (in words:
                                         Renminbi Ten Million) within thirty (30) days after the failure of the above transfer.
                                         Upon closing of such transfer, ZCM and SESHK will respectively hold seventy percent (70%)
                                         and thirty percent (30%) of the Equity Interests.

 

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		(b)	Except as provided for in 6.3(a)
                                         above, either Party shall not transfer, sell, or dispose, in whole or in part, its Equity
                                         Interests to any third party.

 

		6.4	Continued Implementation of Contract

 

Prior to the Transfer of a
Party’s Equity Interests, both Parties shall continue to perform their obligations under this Contract.

 

		6.5	Effect of Transfer

 

The Transfer of a Party’s
Equity Interest shall not release such Party from its liability to pay any sums of money accrued, due and payable, or to discharge
its then-accrued and unfulfilled obligations to the Company or the other Party.

 

		7.	REPRESENTATIONS AND WARRANTIES OF
                                         THE PARTIES

 

		7.1	Representations and Warranties of
                                         ZCM

 

ZCM hereby represents and
warrants to SESHK as follows:

 

		(a)	ZCM is a listed company duly
                                         organized and validly existing under the laws of the PRC and is in compliance with all
                                         conditions required to maintain its status as an enterprise legal person under the laws
                                         of the PRC.

 

		(b)	ZCM has submitted to SESHK a
                                         valid, true and complete copy of its current business license bearing a current annual
                                         inspection seal from the relevant administration for industry and commerce.

 

		(c)	ZCM has taken all appropriate
                                         and necessary actions to (i) empower its legal representative or such other duly authorized
                                         representative whose signature is affixed hereto to sign this Contract and all of the
                                         agreements contemplated herein to which it is a party, (ii) authorize the execution and
                                         delivery of this Contract and all of the agreements contemplated herein to which it is
                                         a party, and (iii) authorize the performance and observance of the terms and conditions
                                         of this Contract and all of the agreements contemplated herein.

 

		(d)	ZCM has obtained all licenses,
                                         permits, consents, approvals and authorizations necessary for the valid execution and
                                         delivery of this Contract and all of the agreements contemplated herein to which it is
                                         a party; provided, however, that this Contract shall be subject to the approval of the
                                         Examination and Approval Authority or other authority before the it may become effective.

 

		(e)	Upon the approval of the Examination
                                         and Approval Authority, this Contract shall constitute the legal, valid and binding obligation
                                         of ZCM and is enforceable against ZCM in accordance with the terms herein.

 

		(f)	ZCM's execution, delivery and
                                         performance of this Contract or any of the other agreements contemplated herein will
                                         not violate any of the constitutional documents, any other agreement or obligation of
                                         ZCM or its Affiliates, or currently effective law, regulation or decree of China that
                                         may be applicable to any aspect of the transactions contemplated hereunder.

 

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		(g)	All information supplied to SESHK
                                         by ZCM in relation to this Contract, including information concerning the business and
                                         financial status of ZCM and any relevant assets, inventories and outstanding contractual
                                         arrangements with their respective suppliers and customers, is true and correct in all
                                         material respects, whether any of the same has been verified or audited by an independent
                                         third party or not.

 

		(h)	ZCM is in compliance in all material
                                         respects with all applicable laws, including in connection with the operation of its
                                         business. ZCM has not received written notice of any material violation of any law, or
                                         any potential legal liability, relating to the operation of its business.

 

		(i)	ZCM is not in default under,
                                         and, to the knowledge of ZCM, no condition exists that with notice or lapse of time or
                                         both would constitute a default or could give rise to a right of early termination, cancellation
                                         or accelerated termination under, any license, permit, consent, approval or authorization
                                         held by ZCM prior to the expiration of its terms.

 

		(j)	ZCM is not the subject of any
                                         existing, pending, threatened or contemplated (i) bankruptcy, insolvency or other debtor’s
                                         relief proceeding, or (ii) litigation, claim, action, suit or other judicial or administrative
                                         proceeding, which could adversely affect ZCM’s right or ability to enter into this
                                         Contract or to consummate the transactions contemplated herein.

 

		(k)	ZCM agrees that the Company shall
                                         be liable for the payment of the Sub-license Royalty To GTI under the sub-license Project.

 

		7.2	Representations and Warranties of
                                         SESHK

 

SESHK hereby represents and
warrants to ZCM as follows:

 

		(a)	SESHK is a company duly organized,
                                         validly existing and in good standing under the laws of Hong Kong Special Administrative
                                         Region.

 

		(b)	SESHK has submitted to ZCM
                                         a valid, true and complete copy of its certificate of incorporation.

 

		(c)	SESHK and its Affiliates have
                                         taken all appropriate and necessary corporate actions to (i) empower its duly authorized
                                         representative whose signature is affixed hereto to sign this Contract and all of the
                                         agreements contemplated herein to which it is a party, (ii) authorize the execution and
                                         delivery of this Contract and all of the agreements contemplated herein to which it is
                                         a party, (iii) authorize the performance and observance of the terms and conditions of
                                         this Contract and all of the agreements contemplated herein.

 

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		(d)	SESHK has obtained all consents,
                                         approvals and authorizations necessary for the valid execution and delivery of this Contract
                                         and all of the agreements referred to herein to which it is a party; provided, however,
                                         that this Contract shall be subject to the approval of the Examination and Approval Authority
                                         or other authority before it may become effective.

 

		(e)	Upon the approval of the Examination
                                         and Approval Authority, this Contract shall constitute the legal, valid and binding obligation
                                         of SESHK and is enforceable against SESHK in accordance with the terms herein.

 

		(f)	SESHK's execution, delivery
                                         and performance of this Contract or any of the other agreements contemplated herein will
                                         not violate any of its constitutional documents, any other agreement or obligation of
                                         SESHK, or currently effective law, regulation or decree of the PRC that may be applicable
                                         to any aspect of the transactions contemplated hereunder.

 

		(g)	All information supplied to
                                         ZCM by SESHK in relation to this Contract, including information concerning the business
                                         and financial status of SESHK and any relevant assets, inventories and outstanding contractual
                                         arrangements with their respective suppliers and customers, is true and correct in all
                                         material respects, whether any of the same has been verified or audited by an independent
                                         third party or not.

 

		(h)	SESHK is in compliance in all
                                         material respects with all applicable laws, including in connection with the operation
                                         of its business. SESHK has not received written notice of any material violation of any
                                         law, or any potential legal liability, relating to the operation of its business.

 

		(i)	SESHK is not in default under,
                                         and, to the knowledge of SESHK, no condition exists that with notice or lapse of time
                                         or both would constitute a default or could give rise to a right of early termination,
                                         cancellation or accelerated termination under, any license, permit, consent, approval
                                         or authorization held by SESHK prior to the expiration of its terms.

 

		(j)	SESHK is not the subject of
                                         any existing, pending, threatened or contemplated (i) bankruptcy, insolvency or other
                                         debtor’s relief proceeding, or (ii) litigation, claim, action, suit or other judicial
                                         or administrative proceeding, which could adversely affect SESHK’s right or ability
                                         to enter into this Contract or to consummate the transactions contemplated herein.

 

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		(k)	SESHK warrants that its contribution
                                         of the SGT rights to the Company, pursuant to the TUCA is exclusive within the Territory
                                         and no other entities and/or individuals, including SESHK and its Affiliates, shall conduct
                                         any SGT related operational business (excluding the existing ZZ Plant and Yima Plant
                                         and projects purely developed for equity investment by SESHK, or its Affiliates, in which
                                         case such projects shall obtain SGT usage rights and SGT Proprietary equipment through
                                         the Company). During the Joint Venture Term, if the Company loses the exclusivity of
                                         the SGT usage rights due to reasons attributable to a breach by SESHK and its Affiliates
                                         (including the employees of SESHK and its Affiliates), ZCM’s actual losses shall
                                         be compensated pursuant to the relevant legal requirements, and if any profits are realized
                                         by SESHK as a result of such breach, such profits shall be paid from SESHK to ZCM.

 

		(l)	SESHK warrants that the exclusive
                                         usage rights of the SGT which it has granted to the Company are legitimate and continuously
                                         existing. During the Joint Venture Term, if the Company loses such continuing SGT usage
                                         rights due to reasons attributable to a breach by SESHK of its warranties under this
                                         Contract, ZCM’s actual losses shall be compensated pursuant to the relevant legal
                                         requirements.

 

		(m)	SESHK warrants to provide the
                                         Company with all of the SGT Know-How and technical data described in Annex 2hereto.For
                                         the 0.2MPa and 1.0MPa Projects similar to the ZZ Plant and Yima Plant (new technology
                                         excluded) SESHK shall be responsible for the various SGT technology performance guaranteed
                                         parameters under the PSA for the Project. SESHK warrants to make sure the Company has
                                         the capability to produce the PDP design and guarantee performance for SGT (similar to
                                         ZZ Plant and/or Yima Plant), and SESHK will bear the costs where support and assistance
                                         by SESHK and its Affiliates and/or partners are needed. After the Company has completed
                                         two Projects (similar to ZZ Plant and/or Yima Plant) and once these Projects have achieved
                                         their required technical performance guaranteed parameters, SESHK shall not be required
                                         to continue providing such warranties or support or assistance

 

		8.	RESPONSIBILITIES OF THE PARTIES

 

		8.1	Responsibilities of ZCM

 

In addition to its other obligations
under this Contract, ZCM shall have the following responsibilities:

 

		(a)	Making its cash contributions
                                         to the registered capital of the Company in accordance with relevant provisions of this
                                         Contract;

 

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		(b)	Actively assisting the Company
                                         in obtaining all necessary approvals, grants, consents, permits, and licenses for the
                                         establishment of the Company, including but not limited to, assisting in the attaining
                                         of a business license providing a term of validity and scope of business acceptable to
                                         both Parties as well as licenses, permits and approvals from the competent authorities
                                         and all other required government approvals;

 

		(c)	Assisting the Company to obtain
                                         the most preferential tax reductions and exemptions and other investment incentives otherwise
                                         available to or for the Company under national, provincial or local laws and regulations,
                                         if any; and actively assisting the Company to obtain PRC central government endorsement
                                         of the SGT technology.

 

		(d)	Assisting the Company in the
                                         purchase of equipment, supplies and raw materials and auxiliary materials manufactured
                                         inside the Territory;

 

		(e)	Assisting the Company in arranging
                                         for the transportation of imported equipment and materials (if any);

 

		(f)	Manufacturing SGT Proprietary
                                         Equipment and other equipment for SGT Projects and selling such equipment to the Company
                                         pursuant to Annex 10.ZCM shall also ensure that all the equipment to be provided to the
                                         Company are fully compliant with PRC law and have all approvals and permits required
                                         under PRC law, and are in good condition in all material aspects. A separate equipment
                                         sales agreements shall be executed (see Annex 6);

 

		(g)	Assisting the Company in applying
                                         for and procuring documents and/or licenses, and in carrying out all customs procedures
                                         and formalities, for the import of machinery, equipment, materials, supplies and office
                                         equipment;

 

		(h)	Assisting with the entry visas
                                         and working permits for expatriates who will provide services to the Company;

 

		(i)	Assisting the Company in the
                                         smooth transfer of employees recruited by the Company from ZCM and with the recruitment
                                         of other qualified Management Personnel and Working Personnel;

 

		(j)	Assisting SESHK’s Affiliate
                                         in completing the performance acceptance test of the Yima Plant in a timely manner;

 

		(k)	Assisting the Company to license
                                         and sell SGT Proprietary Equipment for a high-pressure gasifier of no less than 3.0MP(a)
                                         at the lowest capital cost possible, including the financing of a lump sum turn-key solution
                                         for a SGT gasification island;

 

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		(l)	Undertaking non-disclosure
                                         obligations and liabilities under this Contract and the TUCA; and

 

		(m)	Handling other matters entrusted
                                         to it from time to time by the Company and as agreed by ZCM.

 

		8.2	Responsibilities of SESHK

 

In addition to its other obligations
under this Contract, SESHK shall have the following responsibilities:

 

		(a)	Making its contributions to
                                         the registered capital of the Company in accordance with relevant provisions of this
                                         Contract;

 

		(b)	Performing its obligations
                                         under this Contract;

 

		(c)	SESHK commits to the smooth
                                         transfer of its key personnel into the Company, so as to ensure that the SGT could can
                                         be completely and continuously implemented by the Company (the Company has the right
                                         to select the personnel from SES Shanghai who are appropriate for the Company per Section
                                         14.2); in principle, the Company will execute the employment contracts with the said
                                         personnel with remuneration no less than their previous amounts;

 

		(d)	Providing the Company with
                                         access to SESHK’s global marketing and sales information, and assistance in preparing
                                         the marketing and sales plan for the Company as per conditions mutually agreed by the
                                         Parties;

 

		(e)	Ensuring that SESHK will be responsible
                                         for supplying a complete and workable SGT for projects similar to the ZZ Plant and Yima
                                         Plant, and that the Company does not need to make additional payment for the use of SGT
                                         by the Company, except for the *** Sub-license Royalty To GTI.

 

		(f)	Providing the Critical Design
                                         Parameters free of charge for every Project which implements SGT;

 

		(g)	Assisting the Company in the
                                         purchase of equipment, supplies and raw materials and auxiliary materials manufactured
                                         outside the Territory;

 

		(h)	Assisting the Company in the
                                         smooth transfer of SES Shanghai’s employees recruited by the Company to the Company.
                                         Prior to the establishment of the Company, ZCM has the right to select the personnel
                                         from SES Shanghai who are appropriate for the Company per Section 14.2), and assisting
                                         with the recruitment of other qualified Management Personnel and Working Personnel;

  

*** This information has been omitted
in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

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		(i)	Assisting the Company to obtain
                                         access to lab and bench-scale coal testing services at the ZZ Plant or other operating
                                         facilities which SESHK and its Affiliates control, free of charge, provided that the
                                         Company provides sufficient free coal to run the ZZ Plant at full capacity for five (5)
                                         or more days;

 

Ensuring
that the Company obtains free access to all the coal testing data, currently and in the future, of various coals from SESHK and
its affiliate and GTI (if any)

 

		(j)	Providing engineering design
                                         reviews for the benefit of the Company as described in the TUCA;

 

		(k)	Providing SGT related documents
                                         as described in Annex 2pursuant to the Contract; if SESHK is found to have deliberately
                                         provided false information, or conceal any technology or SGT Know-How described in Annex
                                         2, it shall indemnify the Company for any losses pursuant to the relevant legal requirements;

 

		(l)	Handling other matters entrusted
                                         to it by the Company and as mutually agreed upon from time to time.

 

		8.3	Non-Competition

 

		(a)	During the Joint Venture Term,
                                         the Company shall be the exclusive legal entity within the Territory, subject to the
                                         provisions in the TUCA, for the marketing and sale of any gasification technology that
                                         utilizes SGT Feedstock, even though SESHK acknowledges and agrees that ZCM shall continue
                                         to manufacture and sell within the Territory gasification equipment outside the scope
                                         outlined in paragraph(c) below.

 

		(b)	After the termination of the
                                         Company, ZCM must obtain written consent from SESHK for the development and marketing
                                         of any gasification technology similar to the SGT utilizing the SGT; and after the expiration
                                         of the Joint Venture Term, the Parties shall settle such matters according to mutual
                                         agreement.

 

		(c)	ZCM shall have the right to
                                         bid on and manufacture any equipment in the Territory if ZCM obtains SESHK’s prior
                                         written consent to bid on and manufacture other Pressurized Fluidized Bed gasification
                                         technology equipment.

 

		(d)	During the Joint Venture Term,
                                         ZCM shall sell only through the Company, any proprietary equipment to the Projects that
                                         utilize the SGT within the Territory (excluding the event where a customer only purchases
                                         an SGT license and is not willing to purchase equipment from ZCM or the Company). If
                                         the Company intends to develop any other gasification technology, it shall be submitted
                                         to the Board for unanimous Board approval.

 

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		9.	Environmental PROTECTION

 

The Company
shall comply with officially-promulgated environmental protection, health and safety, and other compliance rules of the PRC imposed
on the Company during the operation and shall undertake any costs of bringing the Company's operations (but not the individual
operations of either Party hereto) into compliance with any subsequent officially-promulgated environmental protection, health
and safety, and other compliance rules of the PRC imposed on the Company.

 

		10.	PURCHASE OF MATERIALS

 

In accordance with this Contract,
the Company shall be entitled to purchase and acquire necessary raw materials, tools, machines and equipment, parts, office supplies
and services for the establishment and operation of the Company, from both the domestic and international market on a best value
basis. ZCM will assist the Company in obtaining raw materials, utilities services and on-site support, per the above. All such
raw materials, machines and equipment, and parts shall be in compliance with the applicable quality standards of the Company and
PRC laws and regulations. The Company shall have the right to utilize the service of ZCM, SESHK or any third party for purchase
of, or may directly purchase parts, materials and office supplies from overseas markets, subject to approval by the Board of Directors
of the Company. Both Parities shall use their best efforts to procure the lowest possible prices for the materials to be purchased
by the Company.

 

		11.	Business Development and Operation

 

		11.1	Development of Business

 

		(a)	The Company’s main focus
                                         shall be the marketing and sub-licensing of the SGT, the sale of SGT Proprietary Equipment
                                         and other equipment, and the sale of Services.

 

		(b)	In furtherance of paragraph
                                         (a) above, the Company shall develop specific marketing materials and websites for each
                                         country in the Territory, promote the SGT at industry conferences, make all reasonable
                                         efforts to have the PRC central government endorse the SGT technology host events for
                                         prospective customers, maintain prospects lists and organize all other activities typical
                                         of a well-managed and aggressive sales and marketing effort.

 

		11.2	Business Implementation

 

		(a)	The Company will grant technology
                                         sublicenses, sell SGT Proprietary Equipment and other related equipment, and provide
                                         Services to third parties in the Territory.

 

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		(b)	The Company will endeavour
                                         to further expand the scope of supply of equipment from only SGT Proprietary Equipment
                                         to also including other gasification upstream and downstream technology, equipment and
                                         pre-fabricating modularization of equipment (if applicable).

 

		11.3	Engineering, Procurement and Construction

 

The Company will endeavour
to expand the scope of supply of equipment and engineering design with a key objective to eventually include turnkey gasification
island offerings with expansion to gas cleaning.

 

		12.	BOARD OF DIRECTORS
                                         AND BOARD OF SUPERVISORS

 

		12.1	Establishment

 

The Board of Directors of
the Company shall be established by the Parties and shall hold its first meeting within thirty (30) days of the Establishment
Date.

 

		12.2	Composition and Term

 

The Board of Directors shall
be composed of five (5) Directors, of whom three (3) shall be appointed by ZCM and two (2) by SESHK, among which, ZCM shall appoint
the Chairman of the Board and SESHK shall appoint the Deputy Chairman. The tenure of Directors on the Board, including Chairman
and Deputy Chairman, shall be no more than four (4) years. Directors may be permitted to serve another term if re-appointed. Any
vacancy created in the Board of Directors shall be filled by the Party which originally appointed the absent Director causing
the vacancy. Any Party may at any time remove for any reason any or all of the individuals appointed by such Party as a Director
and appoint in lieu thereof another individual or individuals to serve the remainder of the relevant term(s).

 

		12.3	Legal Representative

 

The Chairman of the Board
shall be the legal representative of the Company and shall act in accordance with the specific decisions, resolutions and instructions
of the Board of Directors. Whenever the Chairman is unable to fulfil his/her duties to call and preside over a board meeting,
the Deputy Chairman has the right to act for and on his/her behalf.

 

		12.4	Authority

 

The Board of Directors shall
be the highest authority of the Company and shall make decisions on all major and important matters of the Company. The rules
of procedure governing the Board of Directors and its powers and responsibilities are set forth in this Contract and the Articles
of Association.

 

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		12.5	Personal Liability of Directors

 

A Director, including the
Chairman and Deputy Chairman, shall not have personal liability for action he/she undertakes on behalf of the Company within the
scope of authority of this Contract, the Articles of Association or the Board resolutions unless his or her action:

 

		(a)	is outside the scope of the
                                         approval or authorization by this Contract or the Board resolution; or

 

		(b)	is in breach of Articles 147-151
                                         of the Company Law of the PRC; or

 

		(c)	is in breach of the laws and
                                         regulations of the PRC at the time.

 

Any Director, including the
Chairman and Deputy Chairman, acting in violation of this Contract or Board resolutions shall indemnify and hold harmless the
Company against all losses caused to or liabilities and expenses incurred by the Company. The Company shall, to the extent permitted
by law, indemnify any Director for damages or losses incurred in good faith by such Director in the performance of his or her
obligations.

 

		12.6	Matters to be
                                         decided by the Board

 

Matters to be decided by the
Board shall be approved by a simple majority vote of the Directors except for the matters listed below which shall require a unanimous
vote of Directors:

 

		(a)	Amendment to the Contract and
                                         the Articles of Association;

 

		(b)	Termination, liquidation or dissolution
                                         of the Company;

 

		(c)	Increasing, reducing or transferring
                                         the registered capital of the Company;

 

		(d)	Merger of the Company with another
                                         entity or separation of the Company;

 

		(e)	Any matters relating to the
                                         IPO or listing of the Company, including transforming the Company to be a joint stock
                                         limited company;

 

		(f)	Capitalization, separation,
                                         liquidation, voluntary winding-up, or dissolution of the Company, or commencement of
                                         any bankruptcy, liquidation or winding- up procedures;

 

		(g)	Issuing any bond of the Company,
                                         borrowing, lending or guarantee of an amount exceeding RMB 50,000,000 each or making
                                         of a restructuring or other arrangements with creditors;

 

		(h)	Approval of the annual budget
                                         (i.e. the operating plan, forecasted revenues and forecasted expenses) and final account,
                                         investment plan, and profit distribution plan; approval of any capital expenditure, investment
                                         or other purchase of tangible or intangible assets by the Company exceeding by ten percent
                                         (10%) of the approved annual budget;

 

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		(i)	Company’s redeeming,
                                         purchasing or otherwise buying the shares or debt from a Party;

 

		(j)	Any transfer, sale, lease or
                                         other manner of disposition of, or the granting of a mortgage, pledge or lien on any
                                         intellectual property;

 

		(k)	Approval of the participation
                                         by the Company in any project of any competitor of SESHK’s existing or potential
                                         global partner;

 

		(l)	Entering into any related-party
                                         transaction that is not on an arm’s length basis;

 

		(m)	Adopting the business plan
                                         setting forth the guidelines and procedures for continuing the operation of the Company
                                         after substantial losses sustained by the Company for four (4) out of eight (8) consecutive
                                         quarters;

 

		(n)	Deciding on the branding and/or
                                         trademarks of the Company;

 

		(o)	Deciding the policy and procedure
                                         for protecting Confidential Information;

 

		(p)	Other issues that are unanimously
                                         agreed by the members of Board to be decided by the Board.

 

		12.7	Deadlock

 

In the event of a deadlock
the Parties will follow relevant laws and will work in good faith to try and resolve such deadlock.

 

		12.8	Board Meetings

 

The regular meetings of the
Board of Directors shall be held at least two (2) times per calendar year, with each regular meeting to be held no later than
twenty (20) days before closing of each half of that calendar year, unless otherwise agreed by both Parties. Meetings of the Board
of Directors shall normally be held at the registered address of the Company at the date as set by the Chairman, but may be held
at the alternative location and/or date as proposed by one Party if the other Party expresses no objection to such proposal or,
though expresses objection, fails to propose an alternative location and/or date for the meeting within two (2) weeks of the originally
proposed date by the first Party, where the other Party shall be deemed to be in attendance and counted for the purpose of the
quorum.

 

		12.9	Interim Board Meeting

 

Within three (3) days after
the receipt of the written proposal by at least one-third (1/3) of the Directors requesting that an interim Board meeting be held,
either the Chairman or the Deputy Chairman shall send a written notice calling an interim Board meeting. Interim Board meetings
shall be held, in principle, in the form of teleconference or video-conference.

 

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		12.10	Notice of Meetings

 

The written notice shall be
sent at least twenty (20) days prior to any Board meeting specifying the agenda, time and place of the meeting. Such notice may
be waived by the unanimous consent of all Directors attending (in person or by proxy) the meeting. A Board meeting shall be convened
not less than twenty (20) days or more than thirty (30) days from the date of the notice.

 

		12.11	Emergency Board Meeting

 

In extraordinary circumstances
requiring immediate action by the Board and otherwise as provided in this Contract, the Chairman or the Deputy Chairman may call
an emergency meeting of the Board. The Chairman shall send written notice at least twenty-four (24) hours prior to any emergency
meeting, specifying the agenda, time and place of the meeting.

 

		12.12	Attendance

 

A Director may attend a Board
meeting in person, by conference telephone or designating another person by proxy to vote in his place. Such designation shall
be in writing and signed by the Director, and shall identify the meeting or meetings at which the person may act as a proxy and
any instructions that may be applicable to the proxy. A Director may appoint another Director as his proxy. A person acting as
a proxy may do so for more than one (1) Director.

 

		12.13	Quorum for Meetings

 

The quorum for a Board meeting
shall consist of two-thirds (2/3) of the Directors present in person or by conference telephone or by proxy, with each Party having
at least one (1) Director present. However, if a proper notice to convene a Board meeting has been given and if the Directors
appointed by a Party fail to attend the meeting by themselves or by proxy or by conference telephone, and therefore a quorum is
not present as aforesaid, such Board meeting shall be adjourned and reconvened at the same location and time fifteen (15) days
later. If, at the reconvened Board meeting, these Directors still fail to attend by themselves or by proxy or by conference telephone,
the present Directors shall vote in respect of the resolution(s) (the proposal of which shall have already been set out in the
enclosures of the notice of the Board meeting). Resolutions passed in such manner shall have full legal effect.

 

		12.14	Voting

 

The Directors may vote on
any matters by attending meetings in person, by telephone conference or by proxy. Each Director, including the Chairman and Deputy
Chairman, shall have only one vote. Matters not requiring a unanimous vote by the Board of Directors shall be decided by a simple
majority vote of the Directors at a meeting at which a quorum is present.

 

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		12.15	Written Consent

 

The Board of Directors may
conduct any business and make decisions and take actions that could have been otherwise duly taken pursuant to a Board meeting
by means of a unanimous written consent in lieu of a meeting.

 

		12.16	Compensation and Expenses

 

The Company shall not pay
any fee, remuneration or subsidy to any Director for his/her attendance at a Board meeting. The Company shall reimburse a Director
for reasonable expenses incurred in respect of travelling, accommodations and other living expenses to attend Board meetings.

 

		12.17	Minutes

 

Minutes shall be kept for
each Board meeting and signed by all Directors present at the Board meeting in person or by proxy. In order to facilitate the
smooth conduct of Board meetings, the Deputy Chairman shall appoint a “designee” for the purpose of the Board meeting.
The duties of such designee shall be to take detailed minutes of the Board meeting, procure the proper signatures for the adoption
of such minutes, translate or arrange for the translation of documents and dispatch documents relating to the Board meeting to
the Directors. Minutes of the Board meeting shall be maintained in both Chinese and English. Copies of the minutes in both Chinese
and English languages shall be sent to ZCM and SESHK at the addresses set forth in Article 28.6 herein.

 

		12.18	Appointment of the Supervisors

 

		(a)	The Company shall have three (3)
                                         Supervisors, two (2) of whom shall be appointed by ZCM and one (1) of whom shall be appointed
                                         by SESHK. The chairman of the Board of Supervisors shall be appointed by ZCM. At the
                                         execution of the Contract and the Articles of Association, one (1) Supervisor shall be
                                         appointed at each time and each Party shall notify in writing the other Party of the
                                         names of its appointee(s).

 

		(b)	Each Supervisor shall be appointed
                                         for a term of three (3) years and may serve consecutive terms if reappointed by the Party
                                         originally appointing that Supervisor. A Supervisor shall serve and may be removed at
                                         the discretion of the Party which appointed that Supervisor. If an office of a Supervisor
                                         is vacated by the retirement, resignation, illness, disability or death of such Supervisor
                                         or by the removal of such Supervisor by the Party which originally appointed that Supervisor,
                                         the Party which originally appointed such Supervisor shall appoint a successor to serve
                                         out such Supervisor's remaining term.

 

		(c)	No member of the Board or Management
                                         Personnel may concurrently serve as Supervisor.

 

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		12.19	Powers of the Supervisors

 

		(a)	To supervise the management of
                                         the Company, the Supervisors may take the following actions:(i) inspect accounting records,
                                         vouchers, books and statements of the Company; (ii) supervise the duty-related acts of
                                         the Directors and Management Personnel, to put forward proposals on the removal of any
                                         Director or Management Personnel who violates any law, administrative regulation, the
                                         bylaw or any resolution of the Board meeting; (iii) request the Board members and the
                                         Management Personnel to rectify their conducts which are prejudicial to the interest
                                         of the Company;(iv) propose to call interim shareholders’ meetings, to call and
                                         preside over shareholders’ meetings when the Board of Directors does not exercise
                                         the function of calling and presiding over Board meetings as prescribed under the PRC
                                         Company Law; (v) attend meetings of the Board and to make queries or suggestions regarding
                                         matters to be resolved by the Board; (vi) conduct investigation in respect of any abnormal
                                         operation of the Company; (vii) put forward proposals at Board meetings; and (viii) initiate
                                         actions against Directors or Management Personnel according to Article 152 of the PRC
                                         Company Law.

 

		(b)	Each Supervisor shall serve the
                                         Company in such capacity without any remuneration, but all reasonable costs incurred
                                         by the Supervisors in the performance of their duties as Supervisor of the Company shall
                                         be borne by the Company.

 

		12.20	Further Policies and Procedures

 

The Company shall abide by
any other policies and procedures adopted by the Board. The Parties shall take all appropriate actions to cause the Board of Directors
and board of Supervisors to adopt standards of conduct and business practices in conformity with the laws and regulations of the
PRC and such laws and regulations of the United States which apply to SESHK’s operations outside the United States, provided
that they do not conflict with the laws and regulations of the PRC.

 

		13.	MANAGEMENT ORGANIZATION

 

		13.1	Establishment

 

		(a)	The Board of Directors shall establish
                                         a management organization comprised of Management Personnel who shall be in charge of
                                         the day-to-day operations and management of the Company. The management organization
                                         shall include and be headed by one (1) General Manager. The General Manager shall establish
                                         the management team subject to the approval of the Board. The General Manager shall be
                                         nominated by ZCM.

 

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		(b)	The
                                         Management Personnel shall also consist of, one (1) Marketing Director, one (1) Vice
                                         General Manager, one (1) Chief Technology Officer, one (1) Chief Mechanical Engineer,
                                         one (1) Chief Financial Officer, and one (1) Chief Accountant. The General Manager, Marketing
                                         Director, the Chief Mechanical Engineer and the Chief Financial Officer shall be nominated
                                         by ZCM. The Vice General Manager, Chief Technology Officer, and the Chief Accountant
                                         shall be nominated by SESHK. Material financial matters shall be subject to the mutual
                                         decision of the Chief Financial Officer and the Chief Accountant and shall be managed
                                         in accordance with the financial delegation of authority of the management policies of
                                         the Company.

 

		(c)	The candidates shall be officially
                                         appointed following approval by the Board of Directors. Each Party agrees to cause the
                                         Directors appointed by it to approve the other Party’s nominees for the Management
                                         Personnel. The tenure of the Management Personnel shall be no more than four (4) years,
                                         but they may be permitted to serve subsequent terms. If it becomes necessary, due to
                                         dismissal or resignation, to replace a member of the Management Personnel, the Party
                                         which originally nominated such individual shall nominate a replacement to serve the
                                         remainder of the relevant term.

 

		13.2	The General Manager shall be responsible
                                         for carrying out the decisions of the Board of Directors and organizing and directing
                                         the day-to-day operations of the Company. Specifically, the General Manager shall perform
                                         the following duties:

 

		(a)	to implement the resolutions of
                                         the Board;

 

		(b)	to manage the Company to ensure
                                         the purpose of the Company is achieved, as outlined in Article 4.1;

 

		(c)	to be responsible for the profits
                                         (or losses) of the Company;

 

		(d)	to draft the annual financial budget
                                         and annual accounts of the Company for the Board’s approval;

 

		(e)	to stipulate the basic management
                                         rules and specific regulations of the Company;

 

		(f)	to work on the rational and efficient
                                         allocation of Company resources (e.g. capital resources, human resources, etc.);

 

		(g)	to oversee the dedicated business
                                         development personnel;

 

		(h)	to manage the personnel responsible
                                         for developing business;

 

		(i)	other matters as delegated by the
                                         Board.

 

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		13.3	The Chief Financial Officer and
                                         the Chief Accountant shall be responsible for the supervision and maintenance of proper
                                         records and forecasts of the Company’s financial performance. The Vice General
                                         Manager shall be responsible for assisting General Manager for the operations of the
                                         Company. The Chief Mechanical Engineer shall be the main interface with ZCM for equipment
                                         procurement and shall be responsible for equipment mechanical specifications, materials
                                         selection, engineering, fabrication techniques, and quality control which include all
                                         shop and field inspections (pressure tests, all NDT methods and related inspections)
                                         of materials and fabrication quality. The Chief Technology Officer shall be responsible
                                         for technical support to technical pricing in sales, marketing or customer proposals,
                                         process design and SGT performance, PDPs, SGT Proprietary Equipment process specifications,
                                         all other gasification system equipment process specifications, non-equipment engineering
                                         design packages, technical proposals, operating instructions and all other process related
                                         gasification-related matters. The Marketing Director shall be responsible for the marketing
                                         and sales of SGT and SGT related equipment for the Company.

 

		13.4	Indemnification to the Management

 

The specific powers and responsibilities
of Management Personnel shall be prescribed in the relevant provisions of the Articles of Association of the Company. Except for
gross negligence, no Management Personnel shall have any personal liability for any acts performed in good faith, in the normal
course of their employment and within the scope of activities permitted to be engaged in by such Management Personnel as set forth
in this Contract and the Articles of Association.

 

		13.5	Compensation

 

Matters such as salaries,
wages, subsidies, benefits, insurance, allowances, rewards and other compensation matters of Management Personnel, except for
Seconded Personnel, shall be stipulated in the Labour Contract between the Company and such Management Personnel.

 

		13.6	Confidentiality and Non-Competition

 

Each member of the Management
Personnel shall, as a precondition to employment by the Company, execute an agreement in form and substance acceptable to the
Board which shall contain provisions prohibiting the disclosure of confidential information obtained during the course of employment
with the Company and prohibiting such personnel from competing with the business of the Company.

 

Except for Seconded Personnel,
all Management Personnel are forbidden from concurrently serving or working in any other company, unit, entity or organization
whatsoever unless explicitly approved by the Board.

 

		13.7	Management By-laws

 

The Company shall publish
Management By-laws, which shall regulate coordination of responsibilities within management, reporting and work procedures; areas
of responsibility, decision-making competency, any other issues decided by the Board.

 

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The said Management By-laws,
as approved by the Board at the first Board meeting, shall be provided in both Chinese and English.

 

		14.	LABOUR MANAGEMENT

 

		14.1	Enterprise Autonomy

 

The Company shall have all
possible autonomy under the laws and regulations of the PRC concerning the recruitment, employment, compensation, welfare benefits,
procurement of labour insurance, promotion, discipline and dismissal of Working Personnel. The labour policies of the Company
shall be determined in accordance with applicable PRC labour law, labour contract law and regulations and the relevant local rules
on labour management in foreign investment enterprises.

 

		14.2	Employment

 

The Company shall have right
to select from SES Shanghai. The Company and SESHK will consult with each other on the remuneration of such SES Shanghai employees,
and execute a separate memorandum on the employment of such employees within ten (10) working days of the execution of this Contract.

 

The qualification and number
of Working Personnel shall be determined in accordance with the operating needs of the Company as determined by the Board. Each
Working Personnel shall, as a condition to employment by the Company, execute a Labour Contract with the Company, to the extent
permitted by the labour laws and regulations of the PRC. Working Personnel shall observe the various rules and regulations of
the business of the Company in fulfilling their respective tasks.

 

Prior to the establishment
of the Company, various SES Shanghai employees provided services to the ZZ Plant and the Yima Plant. Should the ZZ Plant require
such services or support after the establishment of the Company, the Company shall provide such services or support, as reasonably
requested, at cost. Should the Yima Plant require such services or support after the establishment of the Company, the Company
shall provide such services or support, as reasonably requested, at a reasonable mark-up.

 

		14.3	Compensation Packages and Labour
                                         Protection

 

Matters such as compensation,
wages, subsidies, benefits, insurance, allowances, rewards, and other compensation matters of Working Personnel shall be stipulated
in the Labour Contract between the Company and each Working Personnel; the provisions therein shall be in compliance with Applicable
Law.

 

The Company shall conform
to rules and regulations of the Chinese government concerning labour protection. Working Personnel shall have the right to establish
a Labour Union in accordance with the applicable laws.

 

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		14.4	Training

 

All candidates, except for
the Management Personnel and the personnel taken over from SES Shanghai to the Company, must satisfactorily complete the training
program(if any) specified in their Labour Contracts and a subsequent probationary period of work before they will be officially
considered employees of the Company. An employee’s direct supervisor shall have right to decide, on behalf of the Company,
whether such persons have successfully completed their probationary period and shall be granted employment, or that such persons
shall not be granted employment for whatever reasons, including lack of qualification or otherwise. Any person to whom the Company
does not offer employment after the probationary period shall be given notice before dismissal.

 

		15.	ANNUAL OPERATING PLANS AND BUDGETS

 

		15.1	Preparation

 

The General Manager shall
be responsible for the preparation of the annual operating plans and budgets of the Company. The operating plan and budget for
the next fiscal year shall be submitted to the Board of Directors for examination and approval prior to November 1of each year
and shall include detailed plans and projections regarding:

 

		(a)	capital expenditures of the
                                         Company;

 

		(b)	estimated revenues, expenditures
                                         and profits of the Company;

 

		(c)	staffing levels and plans for
                                         training personnel of the Company; and

 

		(d)	marketing and Project development
                                         plans and policies.

 

		15.2	Examination and Implementation

 

The Board of Directors shall
complete its examination and approval of each annual operating plan and budget for the next fiscal year prior to the end of December 31st
of each year. The Management Personnel shall be responsible for the implementation of the annual operating plan and budget
as approved by the Board.

 

		16.	TAXATION, THREE FUNDS AND PROFIT
                                         DISTRIBUTION

 

		16.1	Tax Treatment

 

The Company shall pay taxes
in accordance with relevant Chinese laws and regulations and shall enjoy all preferential tax and customs treatment available
to it under the PRC law. In order to confirm the tax treatment applicable to the Company, the Parties shall, immediately after
the Establishment Date, procure that the Company submit an application to the appropriate tax authorities of China requesting
confirmation of the tax and duty exemptions, reductions and other preferences to be accorded to the Company.

 

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Furthermore, with the Assistance
of ZCM, the Company shall also apply for any other reductions of or exemptions from relevant taxes and customs duties which are
now available or will become available to the Company under any of the laws and regulations of the PRC.

 

		16.2	Statutory Common Reserve

 

After fully making up accumulated
losses of previous years, if any, and payment of taxes in accordance with the relevant laws and regulations of the PRC, the Company
shall allocate and reserve ten percent (10%) of its annual after-tax profits as the Company's statutory common reserve. The Company
may stop allocating and reserving the profits if the aggregate balance of the common reserve accounts for over fifty percent (50%)
of the Company's registered capital. After the Company has drawn statutory common reserve from the after-tax profits, it may,
upon a resolution made by the Board meeting, draw a discretionary common reserve from the after-tax profits. The amount to be
drawn as statutory common reserve shall be decided by the Board annually in accordance with the financial status of the Company
and pursuant to the laws and regulations of China.

 

		16.3	Profit Distribution

 

		(a)	After paying taxes in accordance
                                         with the law, making up losses and making contributions to the statutory common reserve,
                                         the remaining earnings of the Company shall be available for dividend distribution to
                                         the Parties. The Parties hereby agree that as long as the Company has eighteen (18) months
                                         of working capital reserved that the Company shall distribute to the Parties the profits
                                         in that fiscal year above the amount required to maintain eighteen (18) months of working
                                         capital. Such profits shall be distributed to a Party according to such Party’s
                                         proportion of its paid-in registered capital at the time such profits were earned.

 

		(b)	Distributable profits shall
                                         be distributed to the Parties within thirty (30) days of a Board resolution stipulating
                                         the distribution of such distributable profits to the Parties. Each Party shall procure
                                         that its Directors shall vote in favour of a resolution of any Board member proposing
                                         the distribution of the profits as outlined in this paragraph to the Parties.

 

		(c)	The Company shall not distribute
                                         dividends unless the losses of previous fiscal year(s) have been fully made up. Remaining
                                         undistributed dividend from previous years must be distributed together with that of
                                         the current year and the Board of Directors shall authorise the payment of dividends
                                         from undistributed dividends from previous years at any time so long as the Company has
                                         eighteen (18) months of working capital reserved.

 

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		17.	FINANCIAL AFFAIRS AND ACCOUNTING

 

		17.1	Accounting System

 

		(a)	The Company shall maintain
                                         its accounts in accordance with the regulations in respect of the financial management
                                         and accounting system of foreign-invested enterprises enacted by the Ministry of Finance
                                         of the PRC and any other officially promulgated PRC laws and regulations and the provisions
                                         of this Contract and the Articles of Association. The Chief Financial Officer and the
                                         Chief Accountant, under the supervision of the General Manager, shall establish the accounting
                                         system and procedures for the Company in accordance with the enterprise accounting system
                                         and other relevant regulations. The accounting system and procedures to be adopted by
                                         the Company shall be submitted to the Board for approval. Once approved by the Board,
                                         the accounting system and procedures shall be filed with the relevant local department
                                         of finance and the tax authorities for record purpose.

 

		(b)	The Company shall submit reports
                                         relating to the usage of foreign investment in accordance with the laws and regulations
                                         on statistics and the statistical system of the State and of the Municipality where it
                                         is incorporated (if any) concerning the usage of foreign investment.

 

		(c)	The fiscal year of the Company
                                         shall start on January of the year and end on December 31 of the same year. The first
                                         fiscal year of the Company shall commence on the Establishment Date and end on December
                                         31 of the same year. The last fiscal year of the Company shall start on January 1 of
                                         the year of termination and end on the date of termination.

 

		17.2	Books and Records

 

The Company shall keep true
and correct records and accounts in accordance with applicable PRC accounting laws. All accounting records, vouchers, books and
statements of the Company shall be made and kept in Chinese, however, on the other hand, the Company shall provide financial reports
to SESHK in English on a quarterly basis in accordance with USGAAP.

 

		17.3	Inspection of Books and Records

 

Each Party shall have the
right to examine and copy all books of account, records, vouchers, contracts and documents of any kind that are necessary or appropriate
for monitoring the financial performance of the Company. Each Party may make such examination and copies during the Company’s
normal business hours, provided that such examination and copying do not unreasonably interfere with the business operations of
the Company. Each Party may exercise such rights through its agent or employee or by an independent accounting firm designated
by the Party (at its own cost).

 

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		17.4	Accounting Unit

 

The currency of accounts of
the Company shall be Renminbi. When foreign currency transactions take place, the foreign currency amount will be converted into
the reporting currency for recording purposes. Any increase or decrease in the balance of accounts relating to foreign currency
transactions shall be translated into the currency of account in accordance with the official Foreign Exchange rate announced
by the People’s Bank of China on the transaction date or on the first day of the month when the transaction takes place.

 

		17.5	Reports

 

The Company shall prepare
and provide to the Parties:

 

		(a)	Within ninety (90) days after
                                         the last day of each fiscal year, the balance sheet of the Company as of the end of such
                                         fiscal year and the related profit and loss statement and statement of cash flows for
                                         the fiscal year then ended, in each case audited as provided below.

 

		(b)	Within thirty (30) days after
                                         the last day of each financial quarter, the unaudited balance sheet of the Company as
                                         of the end of such quarter and the related profit and loss statement (for such quarter
                                         and for the year-to-date).

 

		(c)	Within thirty (30) days after
                                         the last day of each month, (i) a profit and loss statement for such month; and (ii)
                                         a forecast/outlook for the remainder of the current fiscal quarter, which shall include,
                                         without limitation, the number of personnel, revenue, cash balance and expenses.

 

		17.6	Audit

 

A qualified independent accounting
firm, licensed in China, shall be engaged by the Company as its auditor, which shall be the same auditor as engaged by ZCM, to
examine and verify the annual financial statements of the Company and shall submit the audit report to the Board and the General
Manager. Either Party shall also have the right to appoint an accountant registered in China or abroad to audit the accounts of
the Company. The expense of the auditor shall be borne by the Party appointing the auditors. Unless the result of any such auditor
is significantly different from that conducted by the Company’s auditor and are accepted by the Board, the expense of such
audit shall be borne by the Company. The Company will permit such accountant to have access to the Company’s books and records
and Management Personnel and will provide such accountant with office space and all other reasonable facilities to enable the
accountant to carry out the audit.

 

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		17.7	Additional Reports and Provision
                                         of Returns

 

The Company
shall provide, without charge, to any Party that may so request a copy of each tax return and report that it is required to file
with any governmental entity in sufficient time prior to such filing to permit its review by such Party prior to filing.

 

		18.	BANK ACCOUNTS AND FOREIGN EXCHANGE

 

The Company
shall open RMB deposit accounts and Foreign Exchange deposit accounts with authorized banks in China, and the procedures for issuing
and signing checks shall be implemented in accordance with the management policies of the Company. The Company may also open Foreign
Exchange deposit accounts with foreign banks outside China as designated by the Board of Directors subject to approval by the
relevant government authorities.

 

		19.	CONFIDENTIALITY

 

		(a)	Each of the Parties acknowledges
                                         and agrees that the disclosure of its obligations under this Contract and the agreements
                                         and documents referred to herein to which it is a party will involve the disclosure of
                                         Confidential Information.

 

		(b)	The Parties shall use all Confidential
                                         Information only for the purposes specified in this Contract, the Annexes and the other
                                         agreements and documents contemplated herein and therein to which it is a party, and
                                         shall not disclose any Confidential Information to third parties without the prior written
                                         consent of the Party providing such Confidential Information; provided, however, that
                                         a Party may be permitted to disclose Confidential Information received by it to its Affiliate(s)
                                         when such disclosure is necessary for such Party to carry out its obligations under this
                                         Contract, the Articles of Association or the other agreements referred to herein upon
                                         the execution of a non-disclosure agreement (which shall hold the receiving party to
                                         the same standard of confidentiality as the transmitting party) between such Affiliate(s)
                                         and the Party providing the Confidential Information.

 

		(c)	The Company, the Parties and
                                         their respective Affiliates that receive Confidential Information shall make such Confidential
                                         Information available only to those of their directors, managers and personnel whose
                                         duties necessitate familiarity with such Confidential Information and shall cause such
                                         directors, managers and personnel also to comply with the confidentiality obligations
                                         set forth in Article 19(b).

 

		(d)	The confidentiality obligations
                                         set forth in this Article 19shall survive the termination or expiration of this Contract.

 

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		(e)	The Parties acknowledge and
                                         agree that SESHK has entered into this Contract under the condition that the SGT, the
                                         SGT Know-How and all other relevant intellectual property will be protected by ZCM and
                                         the Company and that ZCM and the Company shall protect all Confidential Information related
                                         to the SGT, and SGT Know-How and ensure that all such information is not transmitted
                                         to third parties and will be returned to SESHK at the end of the Joint Venture Term or
                                         upon liquidation of the Company and shall not be used by ZCM or the Company except as
                                         specifically authorized under this Contract or under the TUCA.

 

		(f)	This aforesaid confidentiality
                                         provisions under this Article 19 shall not jeopardize, surpass, substitute or impact
                                         the Technical Non-disclosure Agreement already entered into between ZCM and Synthesis
                                         Energy Systems, Inc. on October 11, 2009.

 

		20.	DURATION OF THE COMPANY

 

The term of the Company established
under this Joint Venture Contract and the Articles of Association shall be twenty (20) years, commencing on the date of issuance
of the Company's Business License by the relevant administration for industry and commerce (the “Joint Venture Term”).

 

One (1) year prior to the
expiry of the Joint Venture Term, the Parties shall enter into discussions regarding the extension of such term. If the Parties
agree to extend the Joint Venture Term, they shall enter into a written extension agreement and apply to the Examination and Approval
Authority for approval no less than six (6) months prior to the expiration of the Joint Venture Term. The Joint Venture Term may
be extended only upon the execution of the written extension agreement by the Parties and approval of the Examination and Approval
Authority.

 

		21.	EARLY TERMINATION

 

This Contract may be terminated
in the event that any of the conditions or events set forth below occurs:

 

		(a)	There occurs a material breach
                                         of this Contract and such breach is not cured by the breaching Party within sixty (60)
                                         days after receipt of written notice of the breach from the non-breaching Party. In such
                                         case, the non-breaching Party may give notice of termination to the breaching Party.

 

		(b)	The Company, ZCM or SESHK materially
                                         violates or fails to perform under the TUCA, and fails to timely rectify its breach or
                                         non-performance in accordance with the TUCA, and as a result, the non-breaching Party
                                         is entitled to terminate this Contract and the TUCA at its own discretion.

 

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		(c)	The Company is unable to achieve
                                         positive Net Income within 24 months after its establishment or, after such initial 24
                                         month period, does not achieve positive Net Income in any two (2) consecutive years or
                                         sustains substantial losses for four (4) out of eight (8) consecutive quarters and the
                                         Company is unable to attain its business goals and, after consultation, the Parties are
                                         unable to agree on a business plan to improve the economic situation of the Company.
                                         In such case, either Party may give notice of termination.

 

		(d)	Total or partial performance
                                         of this Contract is prevented by an Event of Force Majeure lasting for more than ninety
                                         (90) days and, after consultation, the Parties are unable to agree on a method to perform
                                         this Contract. In such case, either Party may give notice of termination.

 

		(e)	The Parties mutually agree
                                         to terminate this Contract and agree on the terms for the dissolution of the Company.

 

Where the TUCA is terminated
pursuant to Article 21(b) or other provisions herein, the Company shall be liquidated in accordance with Article 22.1.

 

In case this Contract is terminated
early upon the occurrence of any of the above circumstances, both parties shall observe and abide by the requirements and consequences
as stipulated in Article22.3.

 

		22.	LIQUIDATION AND DISSOLUTION

 

		22.1	Liquidation

 

Upon the adoption of a unanimous
Board resolution to terminate this Contract pursuant to Articles 12.6 and approval by the Examination and Approval Authority to
dissolve the Company, the Parties shall cause the Directors appointed by them to adopt a resolution to liquidate the Company and
establish a liquidation committee. The composition, powers and functions of the liquidation committee, formulation of liquidation
procedures, and payment of liquidation proceeds shall be set forth in the Articles of Association.

 

In the event of a liquidation
of the Company, any of ZCM’s paid-in registered capital contribution to the Company after deduction of the dividends should
be, or already received by ZCM before liquidation, shall be returned to ZCM in priority within the existing liquid assets (excluding
the intangible assets); and SESHK shall not be entitled to such funds; and any remaining cash current net assets shall be distributed
to the Parties according to the respective ownership percentage.

 

		22.2	Effect of Dissolution or Sale as
                                         a Going Concern

 

The dissolution of the Company
or sale of the Company as a going concern, shall not release a Party from its liability to pay any sums of money accrued, due
and payable to the other Party, or to discharge its then-accrued and unfulfilled obligations including any liability to the Company
or the other Party in respect of any breach of this Contract pursuant to the provisions hereof.

 

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Notwithstanding the foregoing,
prior to the liquidation of the Company, SESHK shall have (i) the right to take out from the premises of the Company any materials
relating to SGT provided by SESHK, including any proprietary property provided to the Company pursuant to this Contract and any
other documents, drawings, data, or information in any form; and (ii) have the right of first refusal to purchase any SGT-related
intellectual property legitimately owned by the Company on the same conditions that would be afforded to any reasonable buyer.
If the Company and SESHK cannot agree on such value then SESHK shall be entitled to appoint an independent valuation form to appraise
the value of such SGT related intellectual property.

 

		22.3	Termination

 

		(a)	After the liquidation of the
                                         Company is completed and the Company has been effectively dissolved, the Parties shall
                                         terminate this Contract and the Articles of Association in writing via their respective
                                         authorized representative(s).

 

		(b)	Upon
                                         termination of this Contract for whatever reason, the Company shall return to SESHK the
                                         SGT related information injected as equity contribution from SESHK and any material containing
                                         SGT information or SGT Know-How. Any Improvement developed after the establishment of
                                         the Company shall be settled pursuant to the terms of the TUCA or Section 22.2 above.
                                         After the establishment of the JV Company, any Know-How related materials developed by
                                         by a Party, shall be returned to such Party.

 

		(c)	Immediately after termination
                                         or expiration of this Contract, the Company and ZCM shall no longer be entitled to use
                                         SGT or SGT Know-How, subject to the terms of TUCA.

 

		(d)	Termination or expiration of
                                         this Contract shall constitute an automatic termination of the Technology Usage and Contribution
                                         Agreement and, as a result, any authorization to use SGT or SGT Know-How.

 

		23.	LIABILITY FOR BREACH OF CONTRACT

 

		23.1	Breach of Contract

 

If a Party fails to perform
any of its material obligations under this Contract, or if a representation or warranty made by a Party under this Contract is
materially untrue or inaccurate, the Party shall be deemed to have breached this Contract.

 

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		23.2	Failure to Pay Capital Contributions

 

Provided that each of the
conditions in Article 5.4has either been expressly fulfilled or waived by the Parties, should one of the Parties fail to pay any
portion of its contribution to the registered capital of the Company at the time and in the amounts stipulated in Article 5of
this Contract, such Party shall be deemed to be in breach of the Contract and, in addition to any liability it may incur for such
breach, such Party shall pay to the Company a late contribution penalty at a monthly rate equal to the then applicable lending
rate of the same kind and duration which is published by the People’s Bank of China for Renminbi loans on the amount of
the contribution due and unpaid for as long as such contribution is due and unpaid.

 

		23.3	Indemnity for Breach of Contract

 

		(a)	If the Company suffers any
                                         loss, including but not limited to lost profits, as a result of a breach of this Contract
                                         by either Party, then the breaching Party shall indemnify and hold the Company harmless
                                         in relation to such loss. If the non-breaching Party suffers any loss, including but
                                         not limited to lost profits, as a result of a breach of this Contract by the breaching
                                         Party, the breaching Party shall indemnify and hold the non-breaching Party harmless
                                         in relation to such loss incurred by the non-breaching Party.

 

		(b)	Unless it is otherwise agreed
                                         herein, in the event that any Party fails to make its contributions to the registered
                                         capital of the Company, the contributing party has the right to terminate the Contract.

 

		23.4	Continued Implementation of Contract

 

During the period of breach,
the Parties shall in all other respects continue their implementation of this Contract.

 

		24.	INSURANCE

 

The Company shall, at its own
cost and expense and at all times during the operation of the Company, procure and maintain full and adequate insurance coverage
in a manner prudent and advisable for the Company. The relevant insurance policies may be obtained from any insurance company
authorized to provide such policies in the PRC. The types of insurance (which shall include product liability insurance) and the
value, duration and denomination of the currency of the premiums and insurance proceeds shall be determined by the Board of Directors
based upon the recommendation of the General Manager based on the practices of similar business in other countries and the actual
circumstances in the PRC.

 

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		25.	FORCE MAJEURE

 

		25.1	Performance of Obligations

 

If any Party is prevented
from performing any of its obligations due to an Event of Force Majeure, the time for performance of the obligations under this
Contract specifically prevented from performance by such Event of Force Majeure shall be extended by a period equal to the period
of delay caused by such Event of Force Majeure. A Party claiming inability to perform due to an Event of Force Majeure shall take
appropriate means to minimize or remove the effects of the Event of Force Majeure and, within the shortest possible time, attempt
to resume performance of the obligation(s) affected by the Event of Force Majeure. If an Event of Force Majeure occurs, no Party
shall be responsible for any damage, increased costs or loss which the other Parties may sustain by reason of such a failure or
delay of performance, and such failure or delay shall not be deemed a breach of this Contract. All other obligations under this
Contract and the time for performance thereof shall remain unaffected.

 

		25.2	Notice

 

The affected Party shall immediately
notify the other Party of the occurrence of any Event of Force Majeure and shall provide available evidence thereof. Should the
delay caused by any Event of Force Majeure continue for more than ninety (90) consecutive days, the Parties shall settle the issue
of further performance of this Contract through friendly negotiations in accordance with Article 27(a) and (b).

 

		25.3	Continued Implementation of Contract

 

During the period of an Event
of Force Majeure, the Parties shall in all other respects continue their implementation of this Contract.

 

		26.	APPLICABLE LAW

 

The laws or regulations of
the PRC which are officially published and publicly available shall apply to and govern the formation, validity, interpretation
and implementation of this Contract. In the event that there is no officially published and publicly available law of China governing
a particular matter relating to this Contract, reference shall be made to the relevant provisions in any treaty to which the PRC
is a member or signatory. If there is no such applicable treaty provision, then reference shall be made to general international
practices.

 

		27.	DISPUTE RESOLUTION

 

In the event of a dispute
arising out of or relating to this contract, including any question regarding its existence, validity or termination, the Parties
shall first seek settlement of that dispute by friendly consultation. Upon the occurrence of a dispute, then any Party is entitled
to send a notice to the other Party (the “Reconciliation Notice”), to require the Parties to attempt to solve
this dispute matter through reconciliation within one (1) month after its occurrence, during which time the Parties shall attempt
in good faith to resolve the disagreement and shall cause their respectively designated high level representatives (the “Dispute
Representatives”) to enter into a period of thirty (30) days to negotiate to attempt to resolve the disagreement.

 

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If the Dispute Representatives
have not agreed upon the matter in issue within thirty (30) days, any Party is entitled to request the joint appointment of an
internationally recognised independent expert in the area related to the matter in issue (the “Expert”) to
resolve the matter in dispute, provided that, in making its determination, the Expert shall consider the interests of the Company.
Such Expert's determination shall be non-binding on the Company and the Board. Both parties shall exert best endeavour in good
faith to seek the settlement of the dispute and enforce the decisions made by the Expert.

 

If the Parties fail to jointly
appoint such Expert or the Expert fails to reach a determination related to the resolution at issue within ninety (90) days after
the occurrence of the dispute, either of the Parities shall be entitled to submit the dispute to China International Economic
and Trade Arbitration Commission (“CIETAC”) for arbitration in Beijing, PRC.

 

		(a)	There shall be three (3) arbitrators.
                                         ZCM shall select one (1) arbitrator and SESHK shall select one (1) arbitrator. CIETAC
                                         shall select the third arbitrator, who shall not be a national of the PRC, the Hong Kong
                                         Special Administrative Region, the Macao Special Administrative Region, Taiwan or the
                                         United States, to act as the chief arbitrator. If a Party does not appoint an arbitrator
                                         within the period required by CIETAC, the relevant appointment shall be made by CIETAC.

 

		(b)	The arbitration proceedings shall
                                         be conducted in English and Chinese. The arbitration tribunal shall apply the arbitration
                                         rules of CIETAC in effect on the date when the application for arbitration is submitted.
                                         However, if such rules are in conflict with the provisions of this article, including
                                         the provisions concerning the appointment of arbitrators, the provisions of this article
                                         shall prevail.

 

		(c)	Each Party shall cooperate with
                                         the other Party in making full disclosure of and providing complete access to all information
                                         and documents requested by the other Party in connection with such proceedings, subject
                                         only to any confidentiality obligations binding on such Party.

 

		(d)	The arbitral award shall be final
                                         and binding upon all Parties, not subject to any appeal, and shall deal with the question
                                         of costs of arbitration and all matters related thereto.

 

		(e)	During the period when a dispute
                                         is being resolved, the Parties shall in all other respects continue their implementation
                                         of this Contract.

 

		28.	MISCELLANEOUS

 

		28.1	Public Information and Publications

 

No public statements shall
be made by one Party on behalf of the other Party without its prior written consent.

 

All marketing, advertising
and promotional material relating to the Company shall be subject to prepublication review and mutual agreement by both Parties.

 

    	38

    	 

    

  

		28.2	Language

 

This Contract is executed
in both English and Chinese in twelve (12) original counterparts in each language. Both language versions shall be equally valid.

 

		28.3	Entire Agreement

 

This Contract and the other
agreements contemplated herein constitute the entire agreement among ZCM and SESHK with respect to the subject matters set forth
herein and therein and supersede all prior discussions, notes, memoranda, negotiations, understandings and all the documents and
agreements between them relating to the same. All documents, agreements, understandings and correspondence between the Parties
prior to the execution of this Contract shall, with the exception of any non-disclosure/confidentiality undertakings, become null
and void automatically when this Contract enters into effect.

 

		28.4	Amendment

 

Amendments to this Contract
and the other agreements contemplated herein may be made only by a written agreement in English and Chinese signed by duly authorized
representatives of each of the Parties and, unless prior approval from the Examination and Approval Authority is statutorily required,
will become effective as soon as the amendments are filed with the Examination and Approval Authority for record.

 

		28.5	Conflict or Inconsistency

 

The rights and obligations
of the Parties established by and under this Contract shall continue to exist throughout the Joint Venture Term and shall not
be prejudiced by the establishment of the Company, the adoption of the Articles of Association or the execution of any of the
agreements contemplated herein. In the event of any conflict or inconsistency between this Contract on the one hand and the Articles
of Association or other agreements contemplated herein on the other, the Articles of Association and other agreements contemplated
herein shall prevail.

 

		28.6	Notices

 

Notices or other communications
required to be given by any Party or the Company pursuant to this Contract shall be written in English and Chinese and may be
delivered personally, sent by registered airmail (postage prepaid) by a recognized courier service, or sent by facsimile transmission
to the address of the other Party set forth below or such other address notified in lieu thereof. The dates on which notices shall
be deemed to have been effectively given shall be determined as follows:

 

		(a)	Notices given by personal delivery
                                         shall be deemed effectively given on the date of personal delivery.

 

    	39

    	 

    

  

		(b)	Notices given by air courier
                                         shall be deemed effectively given on the date of delivery (as indicated by the airway
                                         bill).

 

		(c)	Notices given by facsimile
                                         transmission shall be deemed effectively given on the first business day following the
                                         date of transmission.

 

For the purpose of notices,
the addresses of the Parties are as follows:

 

ZCM:
Zhangjiagang Chemical Machinery Co., Ltd.

 

No. 20 Chengyang Road, Houcheng,
Jingang Town, Zhangjiagang City, Jiangsu Province, 215631, PRC

 

Attention: XU, Ye

 

Telephone No:0512-5673-9008

 

Facsimile No.:0512-5673-9009

 

		SESHK:	SES
                                         Asia Technologies Limited

 

7/F.,
Bonham Centre 79-85 Bonham Strand, Sheung Wan

 

Attention:
ROBERT WAYNE RIGDON

 

Telephone
No: 001-(713) 579-0600

 

Any Party may at any time
change its address for service of notice or communication in writing delivered to the other Party in accordance with the terms
hereof.

 

		28.7	Waiver

 

Unless otherwise provided
for, failure or delay on the part of any Party to exercise any right or privilege in this Contract shall not operate as a waiver
of such right or privilege nor shall any partial exercise of any right or privilege preclude any further exercise thereof. Any
waiver by a Party of a breach of any term or provision of this Contract shall not be construed as a waiver by such Party of any
subsequent breach, its rights under such term or provision, or any of its other rights hereunder.

 

		28.8	Headings

 

The headings contained in
this Contract are for reference only and shall not be deemed to be a part of this Contract or to affect the meaning or interpretation
hereof.

 

		28.9	Approval

 

The formation of the Company
will be submitted to related PRC approval authority for approval in accordance with related legal procedures.

 

    	40

    	 

    

 

		28.10	Effectiveness

 

With the signature of each
Party’s representative, which has been authorized by such part’s board of directors, this Contract will come into
effect upon government approval.

 

[signature pages follow]

 

    	41

    	 

    

 

IN WITNESS WHEREOF, the Parties
hereto have caused this Contract to be executed as of the date first above written by their duly authorized representatives.

 

By:

 

	/s/
    Chen, Yuzhong 	 
	Zhangjiagang Chemical Machinery Co., Ltd.
    	 

 

	Name:	CHEN, Yuzhong	 
	 	 	 
	Position:	Chairman	 

 

By:

 

	/s/ Robert W. Rigdon	 

SES Asia Technologies, Limited.

 

	Name:	ROBERT WAYNE RIGDON	 
	 	 	 
	Position:	President	 

  

    	42

    	 

    

  

Annex

 

The followings are the annex that are
being discussed or should be discussed or drafted, and the Party to do that.

1. Business Plan/Objectives

2. SGT Technology Material

3. Form of Project Sub-license Agreement

4. Technology Usage and Contribution Agreement

5. Appraisal Report for SESHK’s capital
contribution

6. SGT Equipment Sales Framework Agreement

7. Representation Letter from SES and its
affiliates for jointly undertaking the obligations and responsibilities of SESHK.

 

    	43

    	 

    

  

Annex 1

 

 

张家港化工机械股份有限公司
(“张化机”) 与综合能源系统公司
(“SESHK”)

成立中国煤气化合资公司

商业计划书

Business Plan for Establishing China
Coal Gasification Joint Venture by ZCM & SESHK

 

		一、概述/Summary	

 

张家港化工机械股份有限公司
(“张化机”) 与综合能源系统公司
(“SESHK”) 双方将成立一家排他性的中国技术和设备合资公司(“合资公司”),其主要目标是:结合SES的气化技术与张化机的装备制造能力使SES气化技术成为中国领先的气化技术解决方案供应商;建立合资公司的价值;为双方带来可观的收入和利润;最终目标是在公开市场上市(如:中国大陆、香港或其他地区)。

Zhangjiagang Chemical Machinery Co., Ltd. ("ZCM")
and Synthesis Energy Systems, Inc. ("SESHK") are establishing an exclusive China technology and equipment joint venture
("JV"), whose main objectives are: to combine SES gasification technology with ZCM equipment fabrication capabilities
to become China's leading gasification technology solution provider; build the JV enterprise value; bring considerable revenues
and profits for both sides; with the ultimate objective of seeking a public markets listing (eg: China mainland, Hong Kong or elsewhere).

 

		二、合资公司背景/Joint	  Venture
                                                                                                                                                                                                                                                                             Background

 

		1.	双方将会成立一个中外合资公司,注册资本为1.538亿元。

The two sides will set up a sino-foreign joint venture
with registered capital of 153.8mm RMB.

 

		2.	经营管理团队:SES将向合资公司提交双方认可的SES的员工支持。张化机将向合资公司提供更多有经验的市场营销、设备设计制造、管理、财务和融资、煤化工市场开拓等方面人员。合资公司将按需要对外进一步招收专业和管理人员。

Management team: SES will provide SES staff supportrecognized
by both sides to the JV. ZCM will provide additionalmarketing, equipment design and manufacturing, management, finance and financing,
market development personnel with experience in the coal chemical industry. The JV will recruit further additional professional
and managerial staff according to the needs.

 

		3.	经营范围:

Business scope:

 

		a)	合资公司被完全授权在授权地区排他性的对客户项目进行设计、生产和销售SES气化技术和专有设备以及配套服务。

The JVis fully authorized to exclusively conduct design,
manufacture and sale of SES gasification technology, proprietary equipment and and ancillary services for the clients’ projects
in the authorized Territory.

 

		b)	合资公司获得完全授权在授权地区内对SES气化技术及其专有设备进行市场营销、销售、许可、生产和提供售后服务。

The JV is fully authorized to conduct marketing, sale,
licensing, manufacture and after-sale service of SES gasification technology and proprietary equipment in the authorized Territory.

 

		c)	主要范围包括:

The main scope includes:

		1)	PDP和相关设计:PDP/设计,合资公司将负责完成PDP设计工作(合资公司成立的初期,SES技术公司将根据相关协议中的所述内容提供培训和协助合资公司的PDP设计工作)。BEDP(基础工程设计包)和DEDP(详细工程设计包)将由合资公司负责协调完成。SES技术公司有义务和责任为每一个合格的合资公司项目提供所有关键设计参数。

PDP and relevant design: PDP/design, the JV is responsible
to complete PDP design (SES will provide training and assist the JV on PDP design as outlined in the relevant agreements at the
beginning of the establishment of the JV). The JV is responsible to coordinate to complete BEDP and DEDP. SES has the obligation
and responsibility to provide all key design parameters for the eligible JV projects.

 

		2)	专有和相关设备的提供:所有专有设备与气化工艺技术捆绑在一起作为综合性的客户解决方案通过合资公司向客户推广。

Provide proprietary and relevant equipment: all the
proprietary equipment and gasification technology are bundled together as a combined customer solution and marketed to clients
through the JV.

 

		3)	合资公司必须努力进一步扩大设备供应范围以使该范围从提供专有设备和工艺技术发展到进一步提供包括尽可能多的其他气化和合成气净化设备。

The JV must endeavor to expand the equipment supply
range so that this range can be developed from providing proprietary equipment and gasification technology tofurther providing
other gasification and syngas purification equipment as much as possible.

 

		4)	设计、采购和建设(EPC):合资公司将努力延伸设备和设计供货范围,主要目标是整体气化岛交钥匙工程以提供具有成本效益的合成气,最终目标是整体工程的EPC供货-设备及技术。

Design, purchase and construction (EPC): the JV will
try to expand the scope of delivery of equipment and design. The main objective is turnkey supply of an integrated gasification
island to supply cost effective syngas, the ultimate objective is supply of the whole project EPC – equipment and technology.

 

		5)	冷启动开车、调试以及后续运行维护:合资公司将出售冷启动开车、调试以及后续技术服务,也可能决定提供试车后的运行和维护服务。

Cold start up, commissioning and subsequent operation
and maintenance: the JV will sell cold start-up commissioning and follow-up technical services, and may decide to offer post-commissioning
operation and maintenance services.

 

三、技术、产品与服务/Technology,
Products and Services

 

		1.	技术背景、知识产权情况:

Technical background,
intellectual property rights

 

		a)	SES气化技术系统(“SES气化技术”)是基于Synthesis
Energy Systems Technologies, LLC(“SES技术公司”)从美国气体研究院(“GTI”)获得许可授权的U-GAS®技术而发展起来的先进流化床气化技术,该技术通过SES技术公司在中国开发、设计和运行的项目以及在全球正在开发项目中的初步设计中获得的经验以及通过SES技术公司及其附属公司高级技术团队的行业经验而不断获得新的技术改进、技术诀窍和专利的发展。应用目标包括使用劣质煤,可再生燃料,如木质生物质和城市固体垃圾的所有气化项目。

SES gasification
technology is an advanced fluidized bed gasification technology developed from the U-GAS® technology that Synthesis Energy
Systems Technologies, LLC (“SES Techco”) obtained the licensing authorization from US Gas Technology Institute (“GTI”).
The technology gained experience fromprojects being developed, designed and operated in China and the preliminary design of global
projects being developed through SES Techco, and it also obtained continuous new technical improvements, technical know-how and
patents developments through industry experience of the senior technical team of SES Techco and its affiliates. The targeted application
includes all gasification projects using low quality coal and renewable fuels, such as woody biomass and municipal solid waste.

 

		b)	SES技术公司将根据协议中所述内容为合资公司提供培训,使合资公司有能力完成第三方项目的PDP设计。对合资公司的培训方案将会被制定和实施;

SES Techco will
provide training to the JV, as outlined in the agreements, to enable the JV have the ability to complete the PDP design of third-party
project. The JV’s training program will be developed and implemented.

 

		c)	合资公司或技术公司所做的所有技术改进将根据合资合同的约定由合资公司拥有和共享。

Technical improvements
made by either the JV or by Techco will be owned and shared as outlined in the.

 

		2.	产品或服务介绍:

Introduction of
products and services:

 

		a)	对客户进行全方位服务,包括但不限于煤样分析、技术方案制定、在SES的工厂进行煤炭试烧、报价、PDP、设计、生产制造方案、工艺路线及主要设备、总承包,冷开车、售后服务、技术更新、必要时包括金融产品服务支持等全方位服务;

Provide full
range of services, include but not limited to coal sample analysis, technical proposal development, coal testing at SES-owned plants,
quotes, PDP, design, production and manufacturing solutions, process routes and major equipment, general contracting, cold start
up, after sale service, technology updates and financial products service support when necessary.

 

		b)	公司主要产品:

Main products:

		1)	气化技术许可、气化工程设计、专有设备(部件)和其他设备(部件)的供应和销售。

Gasification technology licensing, gasification engineering
design, proprietary equipment (components) and other equipment (parts) supply/sales.

 

		2)	气化岛总承包的工作范围:进行结合技术的气化岛项目建设的EPC总承包。

EPC scope of work covering the gasification island:
execution of EPC work scope to construct gasification island projects integrated with technology.

 

		3)	提供合成气:根据市场情况及用户需求,专注于煤气化工厂的一揽子解决方案,并向下游用户提供合成气综合解决方案。

Provide syngas: focus on coal gasification plant
packaged solution(s) and provide integrated solution for syngas to downstream users based on market conditions and customer demand.

 

		4)	开车、试车后的维护和优化服务。

Start up and post-commissioning maintenance and optimization
services.

 

		5)	其他。

Others.

 

四、市场竞争与市场营销/Market
Competition and Marketing

 

		1.	煤化工产业现状及发展趋势分析

Analysis of coal
chemical industry situation and development trend

 

		a)	近10年来,价值主张专注于中国的煤化工发展:“环保风暴”唤醒了化工业对环保和安全等社会责任的重视。化石燃料能源的紧缺,使节能节能(减排)和替代能源提到了前所未有的高度。从2010年国家对“煤化工产业”的紧急叫停,到中国政府的《煤化工产业发展政策》和《煤化工产业中长期发展规划》,近期国家鼓励发展新型煤化工的政策不断将注意力转向更为广阔的利用中国本土自然资源的中国新型煤化工产业的发展蓝图。

The value proposition
focuses on China's coal chemical industry development during the past 10 years: "Green Storm" awakened the attention
to chemical safety, environmental protection and social responsibility. Shortages of fossil fuel energy increased attention on
energy saving (conservation) and alternative energy to an unprecedented height. From 2010 the emergency brake of "coal chemical
industry" by the country to the "Coal Chemical Industry Development Policy" and "Long-term Coal chemical Industry
Development Plan" of the Chinese government, the state policies encouraging the development of new coal chemical industry
continues recent attention towards a broader development blueprint for China's development of the new coal chemical industry utilizing
China based natural resources.

 

		b)	煤化工是我国化学工业的重要组成部分。值此煤化工发展的新形势下,研究煤化工产业的发展趋势,研究煤化工对石油化工等传统能源的替代性,深入探讨我国煤化工的发展战略、发展模式和发展途径是一件涉及煤化工发展全局的大事。下述信息将从宏观(世界、国家)和微观(行业)层面就产业特点、发展趋势等作出分析,对未来的产业投资、建设提出一些观点。

The coal chemical
industry is an important component of China's chemical industry. Regarding the new situation of coal chemical industry development,
it is a big focus involving the overall development of the coal chemical industry to research coal chemical industry trends, study
the alternatives of coal chemical for petrochemical and other traditional energy, and to discuss China's coal chemical industry
development strategy, model and approach. Information provided belowanalyzes industry characteristics and trends from the macro
(world, national) and micro (industry) levels in order to provide views on investingand construction of the industry in the future.

 

		2.	宏观环境分析

Macro Environment
Analysis

 

		a)	行业现状/Industry Status

至2012年,中国约有60家以上大型煤化工工厂,共有商业化运行的大规模气化装置约230套,采用的气化技术主要为鲁奇、德士古、壳牌、GSP、西北化工研究院、华东理工大学、航天气化、盈德-清华等工艺技术,原料是煤、渣油等,主要产品是化肥、甲醇、MTP/O、甲醚、SNG、合成油、乙二醇等。煤气化技术是煤化工产业化发展最重要的单元技术。近20年来,我国主要关注的是高品质的燃料原料,主要引进的气化技术为鲁奇、德士古、SHELL、GSP等。

By 2012, there
are more than about 60 large coal chemical plants in China, a total about 230 sets of large-scale commercial operation gasification
devices, mainly using Lurgi gasification technology, Texaco, Shell, GSP, Northwest Chemical Research Institute, East China University
of Science and Technology, HTL, Yingde - Tsinghua and other technologies with raw materials of raw coal, residual oil, etc. The
main products are fertilizers, methanol, MTP/O, ether, SNG, synthetic oil, glycol. Gasification technology is the most important
cell technology of coal chemical industry development. The major gasification technology introduction in China is Lurgi, Texaco,
SHELL, GSP, etc. during the past 20 years focused primarily on higher quality fuel feedstocks.

 

		b)	我国能源格局/China’s pattern of energy

		1)	在“十一五”规划已经明确我国能源发展的总体战略:“坚持节约优先、立足国内、煤为基础、多元发展,优化生产和消费结构,构筑稳定、经济、清洁、安全的能源供应体系”。煤化工转化项目的发展促使化工行业追求最大限度的利用中国本土资源,而国家经济战略的可持续发展,使得煤化工必然是在今后的长期发展中占据越来越重要的地位。

The "11th Five-Year Plan" has
made overall strategy for energy development in China clear: "persist on conservation, domestic-based, coal-based, diversified
development and optimize production and consumption structure, build a stable, economical, clean and safe energy supply system".
It is an opportunity for development of coal to chemical conversion projects that impels the chemical industry is to pursue maximizing
the use of domestic Chinese resources, and sustainable development of a national economic strategy in which the coal chemical industry
will occupy an increasingly important position in the long-term future development.

 

		2)	从能源结构稳定性来看,我国石油与天然气人均储量与全球平均值有相当大差距。而在储采比上,我国能源的可持续性也很差,如果在未来10至20年中没有大的油田被发现,石油资源瓶颈将危及国内能源安全。而煤炭资源情况与世界平均水平最为接近,具有相对比较优势,这决定了我国长期依赖煤炭的能源格局。在“十一五”期间,2006年至2020年,我国将斥资1万亿发展煤化工项目,其中装备费用占50%,技术费用占10%。煤制甲醇、二甲醚、煤烯烃和煤制油在今后15年将是投资的重点。方向由传统煤化工向现代煤化工转变。

From the point of view of energy structural stability,
there is considerable gap between China's oil and gas per capita reserves with the global average. Regarding the reserve-production
ratio, the energy sustainability of China is also very poor, and if thereareno major oil fields found in the next 10-20 years,
oil resource bottlenecks will threaten domestic energy security. The coal resources areclose with the world average.Chinahas a
comparative advantage, in which China will relyon coal for the long term. In the "11thFive-Year" period, from
2006 to 2020, China will spend 1 trillion RMB to develop coal to chemical projects, which accounts for 50% of equipment, 10% of
technology. Coal to methanol, DME, olefins and oilwill be a critical focus of investment over the next 15 years. The direction
will change from the traditional coal chemical to the modern coal chemical.

 

		3)	从经济稳定性来看,国际能源署(IEA)作出的研究报告表明,每桶石油价格每上涨10美元会使得中国的真实GDP下降0.8个百分点,通货膨胀率上升0.8个百分点。虽然我国石油能源比例不大,但利用煤炭生产化工品,降低石油消耗和进口依赖度,是稳定我国经济发展的必然选择。

From the point of view of economic stability, the
International Energy Agency (IEA) made ​​a study showed that if the price of oil rose $ 10 per barrel, that will cause
China's real GDP to fall 0.8%, the inflation rate will rise 0.8%. Although a small proportion of oil energy in China, the use coal
to manufacture chemicals to reduce consumption and dependence on imports of oil is an inevitable choice to stabilize China's economic
development.

 

		c)	环境污染/Environmental pollution

		1)	2006年,轰轰烈烈的“环保风暴”唤醒了对环保和安全的社会责任感。从环境保护来看,使用清洁煤气化技术后,煤化工能源一体化产业模式能帮助解决常规发电厂的二氧化硫和温室气体排放问题。生态平衡和环境容量是煤化工未来发展比较关键的考虑点,煤制油从根本上说是将一种自然资源转化成另外一种。生产一吨油品需消耗约4吨煤、十吨水,对地区水资源压力很大,而水资源超标消耗可能导致生态失平衡,这与目前国家战略中的可持续发展原则相悖,也是发展煤化工的一个重要限制因素。预计在不远的将来,项目的节水技术应用是产业研发和项目投资的一个重要的价值驱动因素。

In 2006, the vigorous "environmental crisis"
awakened awareness for social responsibility regarding environmental protection and safety. From the point of view of environmental
protection, after using clean coal gasification technology, coal chemical industry energy integration model can effectively help
solve the sulfur dioxide and greenhouse gas emissions from conventional power plant operations. Ecological balance and environmental
capacity are the critical points of consideration of the future development of coal chemical industry. Coal to oil is fundamentally
changing one natural resource into another . Production of one ton of oil requires about four tons of coal and ten tons of water.
There is a lot of pressure on regional water resources and excessive water consumption may lead to ecological imbalances which
is contrary to the principles of sustainable development of the current national strategy, and is also an important limiting factor
of coal chemical industry development. It is expected in the near future that the project's water-efficient technology is an important
value driver for the industrial R & D and project investment.

 

		2)	由于中国煤炭资源和水资源总体为逆向分布,在煤化工规划时必须要考虑水资源平衡和项目的节水技术应用。从水资源分布来看项目投资,山西和宁夏不适合大规模发展煤化工,而贵州、内蒙古、云南和陕西等区域则应该是政策倾斜的地区。因此煤制油不应作为国家战略储备的唯一应用,也不应成为唯一的大规模推广的产业方向。而发改委极有可能会以水资源限制作为煤化工的关键指标。

As China's coal and water resources reserves are
consumed, then water balance and water-saving technology must be considered when planning coal chemical projects. Regarding water
distribution, Shanxi and Ningxia is not suitable for large-scale development of coal chemical industry, and Guizhou, Inner Mongolia,Yunnan,
Shaanxi and other areas should be policy tilted regions. Therefore, coal to oil cannot be theonly targeted use of the country's
strategic reserves, and should not be the sole large-scale promotion direction of the industry. The NDRC is likely to set water
resources limit as a key criteria for the coal chemical industry.

 

		d)	可持续发展/Sustainable development

		1)	发展煤化工产业拥有几项优势:首先政府从战略上考虑,会提高准入门槛,以避免盲目投资,但为鼓励在能源替代技术和装备等方面有所创新,会对行业内企业有所优惠,先行企业有望受益并维持长期优势。其次煤化工成本远低于石化产品,具有很强的经济可行性。再次,煤化工技术可以减少二氧化碳的排放,如若能降低水消耗,完全有替代石化产品的可能。再次国内企业积累和储备了相关技术,可以通过技术改造在高端石化产品领域建立核心竞争力。再次由于煤化工建设费用高,但有很好的发展前景,可以吸引大量民间和国外资本投资,降低资金流动性或营运资金需求,改善国内经济和就业环境。

There are several advantages in developing coal chemical
industry: First, from the strategic considerations, the government would increase the access threshold to avoid blind investment.
But to encourage the innovation of alternative energy technology and equipment, it will offer concessions to enterprises in the
industry;the forerunners may secure benefits and maintain the long-term advantage. Second, coal chemical cost is much lower than
petrochemical products, which has strong economic feasibility. Third, coal chemical technology can reduce carbon dioxide emissions.
If it can reduce water consumption, then it is possible to substitute petrochemical products. Fourth, domestic enterprises have
accumulated and reserved related technologies, they can build the core competitiveness through technological innovation and change
for high-end petrochemical products. Fifth, because of the high construction costs of coal chemical but the good prospects,itcan
attract a lot of private and foreign capital investment, lower the liquidity or working capital requirements, and improvethe domestic
economic and employment environment.

 

		2)	煤化学加工包括煤的焦化、气化和液化。主要用于冶金行业的煤炭焦化和用于制取合成氨的煤炭气化是传统的煤化工产业,随着经济的不断发展,它们将进一步得到发展,同时以获得洁净能源为主要目的的煤炭液化、煤基代用液体燃料、煤气化—发电等煤化工或煤化工能源技术也越来越引起关注,并将成为新型煤化工产业化发展的主要方向。发展新型煤化工产业对煤炭行业及其综合发展具有重要意义。

Chemical processing of coal includes coking, gasification
and liquefaction. Coal coking in the metallurgical industry and coal gasification for ammonia are the traditional coal chemical
industryproducts. With continuous economic progress, they will be further developed. Meanwhile, for the primary purpose of clean
energy, coal liquefaction, coal-based alternative liquid fuels, and coal gasification - power generation or coal chemical energy
technologies are also causing growing concern and will become the main development direction of new coal chemical industry. Development
of the new coal chemical industry has great significance in the industrial sector and integrated development of the coal industry.

 

		e)	宏观调控/Macro-control

		1)	《煤化工产业发展政策》和《煤化工产业中长期发展规划》已经制定完成。

"Coal Chemical Industry Development Policy"
and "Long-term Coal Chemical Industry Development Plan" have been finalized.

 

		2)	煤化工产业发展政策的基本精神是:稳步推进产业发展,不断发展煤化工产业,以缓解石油供应的紧张局面;科学制定发展规划,促进煤炭区域产销平衡,鼓励煤炭资源接续区煤化工产业发展,适度安排供煤区煤化工项目的建设,限制调入区煤化工产业的发展;统筹煤与相关产业的发展,特别是与水资源的协调发展;煤化工业要坚持循环经济的原则,走大型化、基地化的路子,发展开放式的产业链条;加强自主创新,坚持以我为主的自主创新政策,加大政策支持力度,鼓励设备标准化。从以上信息看,传统煤化工行业,如焦炭和化肥,投资增幅将很少,以技术改建为主,而电石产业甚至面临缩减淘汰的可能。

The fundamental spirit of coal chemical industry
development policy is: steady promotion of industrial development, the continuous development of coal chemical industry, ease tensions
of oil supply; scientific development planning, promote regional balance of coal production and sales, encourage coal chemical
industry development in adjacent area to coal resources, appropriate arrangements for coal chemical project construction in coal
supply area, restrict the coal chemical industry development in coal transferred area; coordinate the development of coal and related
industries, especially the coordinated development with water resources; coal chemical Industry must adhere to the principle of
circular economy, pursuelarge-scaleprojects to develop an open industry chain; strengthen independent innovation, adhere to the
principal of independent innovation policy, increase policy support to encourage the standardization of equipment offerings. From
the above information, there will be very little investment growth in the traditional coal chemical industry, such as coke and
fertilizer, which will be mainly based on technical retrofit, and the calcium carbide industry will even face with the possibility
of cut-out.

 

		f)	煤化工产业发展的需求及特点/Coal
chemical industry development needs and characteristics

		1)	众多的研究者认为:世界已进入能源和化工原料多元化的时代,不同国家或地区应根据资源和经济发展的需求选择优质的原料和技术。以煤炭为原料生产化学品和通过转化生成高效洁净能源(电力、燃料油等)的技术将与石油和天然气化工形成并列竞争的趋势,煤化工在各成熟单项技术的支撑下,面临新的发展机遇。

Many researchers believe that the world has entered
a diversified energy and chemical raw materials age. Different countries or regions should choose high-quality materials and technology
based on the resource availability and economic development. The technology that uses coal as a raw material to produce chemicals
and generate efficient and clean energy (electricity, fuel oil, etc.)through conversion will form aparallel competitive trend with
oil and natural gas chemical,with the support of mature individual technology, coal chemical will experience new development opportunities.

 

		2)	我国煤化工产业的发展将以发挥资源优势为基础,以优化能源结构、特别是以优化终端能源结构为方向,通过洁净、高效的技术,为国民经济发展和社会进步提供优质能源保障,其未来发展具有以下主要特点:

China's coal chemical industry development will be
based on taking advantage of resources, optimizing energy structure, especially on optimizing end useenergy structure, provide
quality energy security for national economic development and social progress through clean, efficient techniques. Its future development
has the following main features:

                                      
i.          除发展传统的产品型煤化工(炼焦、合成氨)以外,将以市场为导向,发展以能源转化型为主的煤化工产业,建设能源转化型和产品联产型的综合煤化工厂,如煤炭液化、煤气化—合成燃料与化工产品或电力、热力联产等。

In addition to
the development of traditional coal chemical products (coke, ammonia), it will be market-oriented, develop coal chemical industry
of energy conversion, construct integrated coal chemical plants of energy conversion and product cogeneration, such as coal liquefaction,
coal gasification - synthetic fuels and chemicals or electricity, heat generation, etc.

 

                                     
ii.          规模大型化,采用先进技术。以全球经济一体化为背景,培育世界级煤化工大型企业,建立具有国际竞争能力的大型工厂,如百万吨级产品的大型煤化工厂。采用国内外先进技术和现代装备,清洁生产和提供清洁产品,如现代液化工程、先进的合成反应工程等。

Large-scale, advanced
technology. In the context of global economic integration, foster world-class large coal chemical enterprises, establish large
factories with international competitiveness, such as large coal chemical plant with megaton products. Using advanced technology
and modern equipment,producecleanly and provide clean products, such as modern liquefied engineering and advanced synthesis reaction
engineering.

 

                                   
iii.          在新的煤化工产业发展中,企业将成为新技术发展的主体。企业投资开发先进技术用于技术更新和技术进步,同时注重新技术在国内外市场上的商品化。

In the development
of new coal chemical industry, the enterprises will become the main body of new technologies development. The enterprises invest
indevelopment of advanced technology for technological upgrading and progress, while focusing on commercialization of new technology
in the domestic and oversea markets.

 

                                   
iv.          有利于煤炭工业的产业结构调整,促进相关行业的技术联合,从而可拉动内需,为就业提供条件,具备先进技术的煤化工产业将获优先发展。

Conducive to industrial
restructuring of the coal industry, promoting joint technology of related industries, stimulating domestic demand, providing the
conditions of employment, coal chemical industry with advanced technology will be given priority for development.

 

		g)	煤化工产业发展的机遇及其发展趋势/opportunities
for development of coal chemical and developing trends

		1)	随着市场经济的发展和全球经济的一体化,我国煤炭行业【特别是大型煤炭企业】正不断调整产业结构和产品结构,发展煤化工产业是其中最为重要的途径。

With the development of market economy and integration
of global economic, China's coal industry[especially large-scale coal enterprises] are constantly adjusting the industrial structure
and product mix.The development of the coal chemical industry is one of the most important methods.

 

		2)	煤炭气化在煤化工产业中占有重要地位。

Coal gasification occupies an important position
in coal chemical industry.

 

		3)	开发先进煤气化技术对煤炭行业有重要意义。目前,国家有关部门正在开发具有自主知识产权的煤气化技术,如多喷嘴水煤浆气化、干煤粉气流床气化等,国内引进技术的项目也在规划中。煤炭企业发展煤气化技术需要在总结国内外先进技术的基础上,结合煤种、煤质特点,通过技术、经济研究,开发或采用适宜的工艺和炉型,如加压固定床气化和液态排渣气化等。

Development of advanced coal gasification technology
is important for thecoal chemical industry. Currently, state authorities are developing a proprietary coal gasification technology,
such as multi-nozzle water slurry gasification, dry pulverized coal entrained flow gasification, the domestic introduction of technology
projects are being planned as well. Coal enterprisesshould developgasification technology based on the inclusion of advanced domestic
and oversea technology,and develop or use appropriate technology and enhancethrough technical& economic research, such as pressurized
fixed-bed gasification and liquid slagging gasification combing the coal type, coal characteristics.

 

		4)	以往煤炭气化技术的发展以化工行业为主,目前煤炭行业在研究开发、工程实施、专业技术人员等方面都较薄弱,需要加快国内综合力量的提高。

Conventional coal gasification technology development
is mainly in the chemical industry. The coal industry is currently relatively weakin research and development, project implementation,
and personnel expertise. There is a need to accelerate the improvement of integrated domestic capabilities.

 

		h)	我国煤化工行业存在的问题、风险和国家产业政策/Existing
problems, risks and national industrial policy in China's coal chemical industry

 

		1)	存在的问题:首先,新型煤化工具有投资高、资源消耗量大和污染物排放量大的特点;其次,我国煤炭资源和水资源呈现逆向分布。为此,国家产业政策严格控制煤炭净调入区项目建设,鼓励在水资源充足和煤炭资源丰富的地区发展煤化工。相比之下,我国新疆、贵州、云南和内蒙古4省劣质煤资源丰富,且具有相对丰富的水资源,因此这4个省份更适合发展煤化工。

Existing problems: First, the new coal chemical industry
has the features of high investment, large consumption of resources and pollutant emissions; Second, China's coal resources and
water resources render reverse distribution. Therefore, the national industrial policy strictly controlsthe project construction
in net coal transferred district and encourages the development of coal chemical industry in adequate water resources and rich
coal resources areas. China's Xinjiang, Guizhou, Yunnan and Inner Mongoliaarefour provinces rich in low-qulaitycoal resources.
They have relatively abundant water resources, so thesefourprovinces are more suitable to developthe coal chemical industry.

 

		2)	风险:新型煤化工的技术风险、市场风险和产业政策风险。

Risk: technical risks, market risks and industrial
policy risks of new coal chemical

                                      
i.          技术风险:我国煤化工仍处于经验积累阶段。间接煤制油技术支撑系统还没有完全成熟,另外目前工业化示范项目规模仅160-180kt/a。大规模工业化装置扩大产能存在风险,包括催化剂活性、选择性,催化剂的使用寿命、乙二醇的收率及装置的稳定性等方面仍存在问题;煤制天然气虽然在美国有成功运行经验,但在我国许多问题仍需在实践中解决。

Technical risks:
China's existing coal chemical industry is still in the stage of accumulating experience. Indirect coal to oil technology support
systems are not fully mature. In addition, the current industrialization demonstration project scale is only 160-180kt/a. There
is a risk to expand production capacity in large-scale industrialization equipment including problems with catalyst activity, selectivity,
catalyst life, glycol yields and stability of the coal conversiontoglycol. There is successful operating experience of coal to
gas projects in the United States, but in Chinathereremain numerous issues to be resolved in practice.

 

                                     
ii.          市场风险:

Market risks:

		(1)	首先,新型煤化工工艺煤炭消耗量大,煤炭成本占合成气产品生产成本的比重较高。因此,对煤化工项目来说,能否获得价廉(因此质量较差)的煤炭资源对于能否成功开发一个项目具有至关重要的意义。

First, the
new coal chemical process can consume large volumes of coalfeedstock. Therefore coal costs account for a higher proportion of syngas
production costs. The availability of inexpensive (hence lesser quality) coal resources is importantforcoal chemical projects to
be successfully developed.

 

		(2)	其次,中东地区具有丰富而廉价的轻烃资源,以其为原料裂解制得的低碳烯烃成本低,由此衍生出的聚烯烃、乙二醇等下游产品即使加上运费、关税等费用仍比国内产品更具竞争力。因此国内新型煤化工产品不仅要面对来自国内石油基产品的竞争,还要应对来自中东产品的竞争。

Second, the
Middle East region has abundant and cheap light hydrocarbon resources, the olefinwith low carbon cracked by such raw materials
has a low cost; thus,the price of polyolefin, glycol and other downstream products derived from such olefin is more competitive
than domestic products even adding shipping, customs duties and other charges. Therefore, new domestic coal chemical products not
only have to face competition from domestic petroleum products, but also need to respond to Middle East product competition.

 

		(3)	第三,除煤制油外,其他几种新型煤化工均有大量的在建、拟建项目,这些项目若能顺利实施,行业的产能将大大增加,提高煤制合成气制化学品的开发,如合成氨/尿素、甲醇、二甲醚。

Third, in addition
to coal to oil, other types of new coal chemical projects are in planning, are already under construction,or are beingproposed.If
successfully implemented, the production capacity of the industry will be enhanced, which will likely increase the presence of
numerous coal to syngas to chemicals such asammonia/urea, methanol and DME.

 

		(4)	第四,国内煤化工产品的市场主要分布在东部沿海地区,尤其是华东和华南,而新型煤化工项目主要分布在西部煤炭资源丰富的地区,将增加产品的物流成本。对于煤制天然气来说,天然气管道是很大的制约因素。

Fourth, the
domestic market of coal chemical products is mainly distributed in the eastern coastal areas, especially in eastern and southern
China.The new coal chemical projects are mainly in the western regions with rich coal resourceswhichwill increase products’
logistics costs. For coal to natural gas, gas pipeline logistics are a big constraint.

 

                                   
iii.          政策风险:

Policy risks:

		(1)	首先,现阶段我国有关碳排放和环境保护方面的税还没有征收,一旦起征,将会大大增加煤化工项目的成本。例如,对于煤制油项目,如果实施碳捕集及封存(CCS)技术,其资本成本预计将增加15%。若加上环境税、水资源费、西部地区资源开发生态补偿税等,其成本将更高。

First, taxes
concerning China's carbon emissions and environmental aspects hasnotyet been levied.Onceatax is levied, it will greatly increase
the cost of coal chemical projects. For example, for coal to oil projects, if carbon capture and storage (CCS) technology is implemented,
then capital costs will increase by an estimated 15%. Coupled with environmental taxes, water resource charges, and the ecological
compensation tax of western region resource development, then the cost will be higher.

 

		(2)	其次,地方政府和企业大力发展煤化工项目,但可能会与国家制定的污染物排放和水资源消耗等政策冲突,从而导致项目被取消。

Second, local
governments and enterprises is developing coal chemical projects actively, but it may be conflict with the national pollutant emissions
and water consumption policy set by the countryandresult in the project being canceled.

 

                                   
iv.          国家产业政策:由于煤化工行业存在的问题及风险,国家政策对于发展煤化工项目的态度越来越审慎,先后出台了多个产业政策,规范、引导我国煤化工产业有序地发展。其中最新的是《煤炭深加工示范项目规划》(简称《规划》)和《煤炭深加工产业发展政策》(简称《政策》)。《规划》在全国确定了包括鄂尔多斯3Mt/a煤制二甲醚项目在内的9个省区15个示范项目;《政策》则对“十二五”煤炭深加工示范项目能效和资源消耗指标提出了更为严格的要求。

The national industrial
policy: Because ofthecoal chemical industry issues and risks, the national policy for the development of coal chemical projects
is increasingly cautious and has introduced a number of industrial policies, regulations guiding China's coal chemical industry
to develop the sector in a methodicalmanner. The latest of which was "coaldeep processing demonstration project planning"
(the "Plan") and the "industry development policy of coal deep processing" (the "Policy"). The planconfirmed15
demonstration projects in 9 provinces including Ordos 3Mt/a coal-DME project; the policyproposed more stringent requirements of
energy and resource consumption indicators on the "12thfive year" coal deep processing demonstration projects.

 

		i)	结论/Conclusion

		1)	我国在煤化工领域处于世界领先地位。煤化工项目具有投资高,煤炭消耗和水资源消耗大,污染物排放大的特点。我国新型煤化工许多技术在我国都是首次采用。煤炭价格的上涨,主要消费市场物流成本的增加,碳税、环境税的征收等,都将导致新型煤化工成本的增加。未来国内产能大量释放及来自中东低成本的产品都影响项目的经济性。

China is a world leader in the coal chemical industrial
sector. The coal chemical industry has the features of high investment, large coal and water consumption and pollutant emissions.
Many new coal chemical technologies are first deployed in China. The increasing coal pricesand logistics costs,carbon taxes, environmental
taxes, etc. will lead to an increase in costs in new coal chemical industry. Massive release of future domestic production capacity
and low-cost products from the Middle East will impact project economics.

 

		2)	综上所述,“十二五”期间,国内尚不具备大规模发展新型煤化工产业的客观条件,现在迫切需要的是依靠科技创新建设更高水平的试验示范项目。

In summary, during the "12thFive
year" period, there are insufficient objective conditionsfor developingthe domestic large-scale new coal chemical industry,
it is important for the Chinese economy to build higher level pilot demonstration projects relying on scientific and technological
innovation.

 

 

		3.	竞争状况

Competition status

 

		a)	主要竞争者:目前国内大型现代煤化工项目建设“如火如荼”,项目的核心装置都是其气化部分,目前已在国内应用的煤气化技术多达10余种,具体情况如下:

Main competitors:
there arenumerous large-scale modern coal chemical projects currently being constructed. The core unit of the projects remains
the gasification section. There are more than 10coal gasification technologiesthat have been applied domestically, the details
as follows:

 

国内主要煤气化技术一览表/List
of major domestic coal gasification technology

	
        序号

        No.
	
        气化技术

        Gasification technology
	
        类型

        Type
	
        技术拥有方

        Technology owner
	
        适应煤种

        Feedstock
	
        代表企业

        Represent enterprise

	1 	
        鲁奇碎煤气化

        Lurgi
	
        固定床

        Fixed bed
	
        德国鲁奇公司

        Lurgi
	
        褐煤、不粘结性或弱粘结性的煤

        Lignite, unbonded or weak caking coal
	
        天脊煤化工

        Tianji Coal Chem

	2 	
        GE水煤浆气化

        GE coal water slurry
	
        气流床

        entrained flow bed
	
        美国GE公司

        GE
	
        低灰熔点的煤

        Coal with low ash melting
        point
	
        渭河化工

        WeiheChem

	3 	
        多元料浆气化

        Multi-component Slurry
	
        气流床

        entrained flow bed
	
        西北化工研究院

        Northwest Research Institute
        of Chemical
	
        低灰熔点的煤

        Coal with low ash melting
        point
	
        安徽淮化

        Anhui HuaiChem

	4 	
        多喷嘴对置水煤浆气化

        Opposed-nozzles-gasifier For Coal-water-slurry
	
        气流床

        entrained flow bed
	
        华东理工大学

        East China University of Science
        & Technology
	
        低灰熔点的煤

        Coal with low ash melting
        point
	
        江苏灵谷

        Jiangsu Linggu

	5 	
        Shell干煤粉气化

        Shell Dry Coal Dust
	
        气流床

        entrained flow bed
	
        英荷壳牌

        Shell
	
        煤种基本无限制,但劣质煤的使用效率不高

        unlimited but not efficient
        w low quality coal
	
        安庆石化

        AnqingPec

	6 	
        GSP干煤粉气化

        GSPDry
        Coal Dust
	
        气流床

        entrained flow bed
	
        德国西门子

        Siemens
	
        煤种基本无限制,但劣质煤的使用效率不高

        Unlimited but not efficient
        w low quality coal
	
        神华宁煤

        ShenhuaNing Coal

	7 	
        两段式干煤粉气化

        Two StageDry Coal Dust
	
        气流床

        entrained flow bed
	
        西安热工研究院

        Xi'an Thermal Power Research
        Institute
	
        煤种基本无限制,但劣质煤的使用效率不高

        unlimited but not efficient
        w low quality coal
	
        华能天津

        HuanengTianjing

	8 	
        多喷嘴对置干粉煤气化

        Opposed-nozzles-gasifier For Dry Coal Dust
	
        气流床

        entrained flow bed
	
        华东理工大学East

        China University of Science
        & Technology
	
        煤种基本无限制,但劣质煤的使用效率不高

        unlimited but not efficient
        w low quality coal
	
        尚未投运

        No operation

	9 	
        HT-L粉煤加压气化

        HTL
	
        气流床

        entrained flow bed
	
        航天长征公司

        HangtianChangzheng Co.
	
        煤种基本无限制,但劣质煤的使用效率不高

        unlimited but not efficient
        w low quality coal
	
        鲁西化工

        LuxiChem

	10 	
        非熔渣-熔渣分级气化

        Non slag and slag classification
	
        气流床

        entrained flow bed
	
        清华大学

        Tsinghua University
	
        煤种基本无限制,但劣质煤的使用效率不高

        unlimited but not efficient
        w low quality coal
	
        阳煤丰喜

        Yang Coal Fengxi

	11 	
        WHG(五环炉)煤气化

        WHG
	
        气流床

        entrained flow bed
	
        五环工程公司

        Wuhuan Engineering Co.
	
        煤种基本无限制,但劣质煤的使用效率不高

        unlimited but not efficient
        w low quality coal
	
        尚未投运

        No operation

	12 	
        水煤浆水冷壁煤气化

        coal water slurry water cooled
        wall
	
        气流床

        entrained flow bed
	
        清华大学

        Tsinghua University
	
        煤种基本无限制,但劣质煤的使用效率不高

        unlimited but not efficient
        w low quality coal
	
        阳煤丰喜

        Yang Coal Fengxi

	13 	
        BGL熔渣煤气化

        BGLslag
	
        固定床

        Fixed bed
	
        英国燃气公司

        British Gas
	
        褐煤、不粘结性或弱粘结性的煤

        Lignite, unbonded or weak caking coal
	
        云天化金新

        Yuntianhua New Gold

	14 	
        U Gas煤气化

        U-GAS
	
        流化床

        Fluidized bed
	
        美国SES公司

        SES
	
        褐煤、劣质煤和生物质等

        Lignite, low quality coal and biomass
	
        枣庄/义煤SES

        Zaozhuang/Yima Coal Chem

 

		b)	竞争优势及市场定位:

Competitiveadvantagesand
market positioning:

		1)	鉴于U-GAS® 特别适合劣质廉价煤和生物质,如褐煤、烟煤、泥煤等,因此,U-GAS®气化技术非常适合在内蒙、新疆、宁夏、陕西、青海、贵州等劣质煤产地发展大型煤化工项目;

U-GAS® is especially suitable for low-quality
&low-cost coal and biomass, such as lignite, sub-bituminous coal, peat, etc. Therefore, U-GAS® gasification technology
is very suitable for developing large coal chemical projects in Inner Mongolia, Yunnan, Xinjiang, Ningxia, Shaanxi, Qinghai, Guizhou
and other regions with low-quality coal feedstocks;

 

		2)	工艺生产对环境友好、排放的废水不含焦油、酚等杂质,处理成本很低,而其他气化技术中含有大量的焦油等油质,使废水处理过程复杂且费用很高;

Environmentally friendly process produceswaste waterthat
does not contain tar, phenol and other impurities.The processing cost is very low, while alternative gasification technologies
contain a large amount of tar oil so theirwaste water treatment process is complicated and costly;

 

		3)	生产过程中用水量低于其它气化技术,使我们的技术特别适合在内蒙、新疆等缺水和无法方便处理废水的地区;

Water consumption in the production process is lower
than other gasification technologies. This makes our technology particularly suitable for use in Inner Mongolia, Xinjiang and other
regions lacking of water and where waste waterdisposal cannot be easily managed;

 

		4)	大部分设备部件可以国产化,不需要繁琐的备煤系统和后续的污水处理设备,较其他煤气化技术,SES技术具有资本成本优势;

Mostequipment components can be produced domestically,
without cumbersome coal preparation system and subsequent sewage treatment equipment. Compared with alternative coal gasification
technologies, the SES technology presents a favorable capital cost advantage;

 

		5)	甲烷含量较其他气化技术高,非常适合中国政府高效利用煤炭进行清洁生产的要求,特别适合煤制天然气项目,帮助减轻空气污染和对燃煤发电站的严重依赖。

Methane content is higher than other gasification
technologies, highly compatible with the Chinese government’s requirements for clean and efficient utilization of coal feedstock,
especially for coal to gas projects to help mitigate air pollution from heavy reliance upon coal burning power generation stations.

 

		4.	市场营销策略、销售渠道、销售目标

Marketing strategy,
sales channels, sales targets

 

		a)	利用张化机在全国煤化工产业中已建立起来的庞大的客户资源和良好关系及已有的信用渠道,进行市场营销;

Conduct marketing
by using an existing large customer base,good relationships and an existing credit channel already built by ZCM in the country;

 

		b)	利用SES多年来建立起来的客户资源,进一步开拓销售渠道;并在可行时提供到中国和/或美国伊利诺伊州芝加哥的现有运营设备的现场参观;

Use the client
resources built up by SES over the years to further develop sales channels and offer site tours when possible of existing operational
assets in either China and/or Chicago, Illinois in the United States;

 

		c)	销售目标为国家已审批的大型煤化工项目,煤化工技术改造项目(如化肥气源改造等);

Sales target
is the large coal chemical projects approved by the country, coal chemical transformation projects (i.e. for examplecoal to syngas
to ammonia for fertilizer production);

 

		d)	在初期推广项目中,可能会利用贷款、融资、现有的中国的银行和投资机构关系等手段,通过提供全面的(一站式)客户解决方案协助取得项目客户。

At the early
stage of the promotion of the project, may use loans, financing, existing China banking and investment institutional relationships,and
other means to assist in obtaining project customers by providing as comprehensive (one-stop shopping) customer solutions as possible.

 

五、公司发展战略/
Company Development Strategy

 

发展理念、思路、步骤

Development Steps

 

		1.	近期1-2年内:以U-GAS®煤气化技术为核心,利用合作伙伴的方式为客户提供一揽子解决方案,包括技术、资金、市场、设备制造以及工程设计、人才储备。利用国内目前大力倡导和扶持国内煤炭资源的清洁和高效利用的有利时机,完成以下几项主要任务:

1-2 year overview:
Based on the U-Gas technology, utilizing a partnership approach to serve customers with a packaged solution coveringtechnology,
funding, marketing, equipment fabrication, engineering and human resources. Consideringthe current government preferential policies
on clean and efficient coal processing of domestic Chinese resources, the JV will develop the China market first, steps as below:

 

		a)	协助SES公司,全面实现U-GAS®技术现有的0.2MPa(枣庄工厂)和1.0MPa(义马工厂)气化技术的稳定并按预期运行。促使义马工厂尽快通过验收。并以此为突破口,进一步推广U-GAS®气化技术。

Assist SES on
the existing 0.2 MPa (ZZ plant) and 1.0 MPa(Yima) facilities, when and if SES so requests, to make sure the plant can operate reliably,
in accordance with expectations, and in a viable manner.Final Technical acceptance of Yima as soon as possible is to be emphasized.
After the final Yima technical acceptance, the JV will be able to use successful commissioning of Yima to further promote the implementation
of U- Gas technology.

 

		b)	完善SES公司现有的***MPa工艺包,并在商业化项目中应用。

Complete the
existing ***MPa PDP and apply it in a commercial project.

 

		c)	以股东双方现有资源中的优质成分为基本班底,并在行业内招聘更多有工作经验的技术、销售等人员组建富有竞争力的团队。

Retain existing
human resources as selected from SES and hire additional experienced technology and business development personnel to continue
building a highly competitive team.

 

 

 

*** This information has been omitted in
reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

 

 

 

		d)	逐步开发越南、印度尼西亚、菲律宾、马来西亚等SES已有潜在项目概念的市场(如印度尼西亚的Pertimina)。

Develop the
Vietnam, Indonesia, Philippines and Malaysia markets for which SES already has several project concepts under discussion (for example,
Pertiminain Indonesia).

 

 

		e)	探索与SES海外项目合作,并积极推广U-GAS®气化技术在其他领域的应用,如冶金行业的直接还原铁和发电(如SES与GE发电部门以及各印度钢铁制造商的关系)。

Explore more
overseas cooperation opportunities with SES and develop more business verticals such as DRI and Power Generation(for example, SES
relationship with GE power generation divisions and various Indian steel manufacturers).

 

		f)	争取在18个月的时间内,合资公司完成至少2~3个气化装置的销售。

Target to complete
minimum 2~3 projects in the first 18 months.

 

		g)	在合资公司建立的第一年内,将寻求使SES气化技术通过中央政府的支持。

The JV will,
within the first year of establishment, seek to have the SES Gasification Technology endorsed by the China central government.

 

		2.	中期2-4年目标:

Medium target in
next 2-4 years:

 

		a)	进一步完善U-GAS®煤气化技术的设计质量;

Further improve
the design qualities of the U-GAS® technology;

 

		b)	稳定、有信誉和成熟的公司团队和技术服务;

Stable, reputable,
and mature team and technical service;

 

		c)	年度计划-目标安装设备:

Yearly schedule
– targeted installations:

 

	 	
        第一年

        1st year
	
        第二年

        2nd year
	
        第三年

        3rd year

	项目数Project #	气化炉台数Gasifier #	项目数Project #	气化炉台数Gasifier #	项目数Project #	气化炉台数Gasifier #
	***MPa(***)	***	***	***	***	***	***
	*** Mpa(***)	***	***	***	***	***	***
	***MPa(***)	***	***	***	***	***	***
	总计Total	***	***	***	***	***	***

 

		d)	形成稳定成熟、持续成长的盈利能力;

Mature and stable
growth earning ability;

 

*** This information has been omitted in
reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

 

 

		e)	获得足够增长和市场信誉,使合资公司能公开发售或出售以成为更大的实体公司。

Achieve sufficient
growth and market reputation to develop the option to conduct an initial public offering or sale of the Joint Venture to a larger
balance sheet capable entity.

 

		3.	较远期的目标5年以后:

Long term target>5
years

 

		a)	使U-GAS®煤气化技术成为中国煤气化市场的主流技术,提供三种产品质量:

		·	具有竞争力的成本,高质量的做工,以进行可靠和安全的操作

		·	工艺环保

		·	以较低的成本应用于低质原料

U-Gas gasification
technology to become the major technology supplier in the market, offering three product qualities:

		·	Competitive cost with high quality workmanship resulting in reliable and safe operations

		·	Environmentally friendly process

		·	Applications on lower cost and lower quality feedstock material

 

		b)	取得EPC总承包资质及其他相关的质量控制认证。

Acquire an EPC
certification and other relevant quality control certifications.

 

		c)	使合资公司成为具备综合化工技术研发和化工设计工程建设能力的高科技企业。

Develop the
JV into a high technology company with comprehensive chemical technology R&D center and design engineering construction capability.

 

		d)	成为信誉良好、有竞争力、盈利能力的国际化工程技术公司。

Become a reputable,
competitive, and profitable international engineering technology company.

 

		e)	稳定可持续发展的盈利及投融资关系(银行和投资机构)以便为客户提供更多的价值主张。

Sustainable
earning ability and investment and funding relationships (banks and investment institutions) to bring to customers as an additional
value proposition.

 

六、风险分析/Risk
Analysis

 

		1.	可能的风险因素(政府政策变化、管理、商品市场(电力、化工等)、建设、资金成本、政治、汇率变化、客户信用等):

Possible risk factors
include government policy changes, management retention, commodity markets (electricity, chemicals, etc.), construction, capital
cost, political, currency exchange rates, customer credit, etc.:

 

		a)	上述风险是所有企业都必须管理的典型风险;

The risks as
mentioned above are typical risks all enterprises must manage;

 

		b)	U-GAS®煤气化技术在高压方面还没有商业化项目运行。

U- GAS®
technology currently lacks a commercially operating project for high pressure gasification。

 

		2.	风险控制

Risk Mitigation

 

		a)	中国的能源消费结构将转向以清洁和具成本效益的方式消耗国内资源,因此为了可持续的电力、天然气和化工生产,洁净煤化工技术是未来中国国家战略重点。

China’s
energy consumption structure is heading towards consumption of domestic resources in a clean and cost effective manner. Hence clean
coal gasification technology is a strategic focus of China in the near future for sustainable power, natural gas and chemical production.

 

		b)	合资公司是按照现代新兴企业架构组建的合资有限责任公司,其成立和运行受法律保护。其所涉及的技术、知识产权、会计和财务控制系统均通过合法的程序而获得。

The JV is a
jointly owned limited liability company in compliance with corporate governance rules. The technology, Intellectual Property, accounting
and financing control systems are all setup following relevant laws and regulations.

 

		c)	SES公司将继续促使义马项目的气化装置尽快通过最终的技术验收。

SES will continue
to pursue the final technical acceptance of the gasification installation at the Yima project.

 

		d)	U-GAS®技术是一种成熟的,可行的工艺,有实际装置可允许潜在客户参观。

U-GAS®technology
is a proven, workable process with actual sites allowing for visual inspections by prospective customers.

 

		e)	制订有效、科学、符合市场要求的客户策略。

Setup an efficient
scientifically proven and market orientedcustomerstrategy.

 

		f)	充分利用中国政府相关产业政策提供给新技术的优惠待遇,提供有竞争力的清洁燃料转换工艺。

Fully utilize
the related governmental industrial policies providing for preferential treatment of new technologies offering competitive and
clean fuel conversion processes..

 

		g)	使用SES和张化机的人力资源,建立专业、成熟、有竞争力的团队。

A professional,
proven, and competitive team is targeted using SES and ZCM staffing resources.

 

		h)	张化机利用自身设备制造的优势,其目标是提供低成本、高品质的客户服务,提高合资公司的市场竞争力和最终价值。

ZCM will employ
its advantage’s concerning equipment manufacture for the JV. The objective being to provide low cost and high quality customer
service and improve the competitiveness and ultimate valuation of the JV.

 

		i)	管理运营成本,同时最大限度地提高市场占有率和美誉度。

Manage operating
costs while maximizing market presence and reputation.

 

		j)	合资双方优势互补,为双方创造更大的股东价值。

Combine the
advantages of both ZCM and SES and create higher shareholder value for both entities.

 

    	 

    	 

    

附件
2 - SGT技术资料

Annex 2 - SGT 技术资料

 

根据SESHK与张化机的合资协议,本次合资SESHK将提供如下资料:

According to the JV contract between
SES and ZCM, SES will provide following materials:

 

1.义马项目PDP设计(1.0MPa)2

PDP design of Yima
project (1.0MPa)2

2.枣庄项目PDP设计(0.2MPa)3

PDP design of Zaozhuang
project (0.2MPa)3

3.通用高压(***MPa)气化装置PDP设计5

Generic PDP design
of high pressure gasification unit (***MPa)5

4.气化模型及计算软件描述5

Gasification model
and calculation software description5

5.枣庄及义马工厂操作数据5

ZZ & YM Plant
operating data5

6.枣庄工厂试烧报告5

Coal testing reports
of ZZ Plant5

7.枣庄及义马工厂操作手册6

ZZ & YM Plant
operating manual6

8.SES分析研究报告6

SES Analysis Report
and Research Report6

9.SGT性能保证机制及保证值8

SGT performance
guarantee mechanisms and the guaranteed value8

10.义马项目工程询价资料8

Yima Project engineering
quotation material8

11.专有设备图纸及目录9

Proprietary equipment
drawings and catalog9

12.SES专利及目录9

SES patents and
catalog9

13.专有技术(技术诀窍)描述9

Description of
Proprietary technology (know-how)9

14.SGT的完整性(SESHK注入到合资公司的SES气化技术的完整性)10

The Completeness of SGT
(the completeness of SES gasification technology injected into the joint venture by SESHK)10

 

*** This information has been omitted in reliance
upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange
Commission.

 

 

 

 

 

各项所包含的内容简述:

Brief description of each item:

 

		1.	义马项目PDP设计(1.0MPa)

PDP design of Yima project
(1.0MPa)

		(1)	控制描述:包括

Control Description,
including

		A.	***;

***

		B.	***;

***

		C.	***

***

		D.	***

***

		E.	***

***

		F.	***

***

		G.	***

***

 

*** This information has been omitted in reliance
upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities and Exchange
Commission.

 

		(2)	旋风分离器报告:包含SES对枣庄工厂旋风系统特别是第二旋风分离器的研究报告以及对义马煤试烧时,上海化工研究院做的布袋过滤器粉尘的粒径分布。

Cyclone Report:
Contains SES study report on ZZ Plant’s cyclone system, especially on the 2nd stage cyclone; and the PSD (particle size distribution)
tested by Shanghai Research Institute of Chemical Industry of fines captured by the bag house during YM coal test.

		(3)	工程管理:

Project Management

		A.	义马项目开工报告RevB

Yima project
start reporting RevB

		B.	义马项目组织机构及管理文件

Yima project
organization structure and management documents

		C.	义马PDP风险评估
Rev F

Risk Assessment
of Yima PDP Rev F

		D.	义马PDP进度安排

Schedule of
Yima PDP

		E.	义马PDP团队联系方式20090615

Contact info
of Yima PDP team 20090615

		(4)	图纸及文件模板

Drawings and
document templates

		(5)	物料平衡

Material balance

		(6)	会议纪要

Meeting notes

		(7)	供参考的初设设计基础

Preliminary
design basics for reference

		(8)	东华工程公司初设文件

Preliminary
design documents of East China Engineering Company

		(9)	装置工艺描述

Device Process
Description

		(10)	义马PDP模型审查

Model Review
of Yima PDP

		(11)	义马PDP文件

Yima PDP documents

(1)                
工艺

Technology

(2)                
设备

Equipment

(3)                
仪表

Instrumentation

(4)                
管道、电气、HSE

Piping,Electrical,HES

		(12)	双语版义马PDP

Yima PDP in
bilingual

注:根据义煤集团要求,SES所提供的文件深度及范围超出《石油化工装置工艺设计包(成套技术工艺包)内容规定》SHSG-052-2003标准,同时,提供备煤工段的设计包,义煤集团支付相关费用。

Note: According
to Yima Coal Industry Group’s requirements, the depth and scope of the documents provided by SES beyond "petrochemical
plant process design package (set of technologies technology package) content requirements" SHSG-052-2003 standard, while
SES provided the design package of coal preparation section as well, and Yima Coal Industry Group paid for related fees.

		(13)	义马技术许可合同复印件

Print copy
of Yima Technical Licensing Contract

 

		2.	枣庄项目PDP设计(0.2MPa)

PDP design of Zaozhuang
project (0.2MPa)

		(1)	PFD

PFD

		(2)	物料平衡

Material balance

		(3)	PID

PID

		(4)	工艺描述

Process Description

		(5)	设备表

Equipment
list

		(6)	仪表清单

Meter list

		(7)	关键设备数据表

Key equipment
data sheets

		(8)	设备布置图

Equipment
layout

		(9)	气化炉连锁动作表

Gasifier interlock
list

		(10)	操作手册

Operation
Manual

		(11)	PDP文件权限表

PDP file permissions

		(12)	常用文件模板

Frequently
used Document templates

		(13)	枣庄历次技改项目资料

ZZ retrofit
projects materials

		A.	TT项目申请表

TT Project
Application Form

		B.	材料表

Material list

		C.	改造项目

Retrofit project

		D.	项目文件模板

Project document
template

		E.	字型文件

Font files

		F.	项目设计条件管理指南.doc

Project design
conditions management guide

		G.	2007NEWBLANKnew.dwg

2007NEWBLANKnew.dwg

		H.	design Dep.org.chart.xls

design Dep.org.chart.xls

		I.	项目列表

project list.xls

		J.	SES工程部名单

SES engineering.xls
(SES engineering dept name list)

		K.	高效旋风分离器技术协议20081114罗.pdf

High efficiency
cyclone technology agreement 20081114 Luo.pdf

		L.	关于工程设计修改的报批程序20080520.doc

Engineering
design modification approval process20080520.doc

		M.	老虎队立项申请表.xls

TT Project
application form

		N.	上海科元联系单.doc

Contact form
of Shanghai Keyuan

		O.	设计变更表.xls

Design change
form

		P.	设计人员登记表.xls

Designers
registration form

 

		3.	通用高压(***MPa)气化装置PDP设计

Generic PDP design of high
pressure gasification unit (***MPa)

包含整套4.0MPa气化系统的第三版的PDP设计文件

Containing the
entire third edition of the PDP design file of ***MPa gasification system

		(1)	工艺

Technology

		(2)	设备

Equipment

		(3)	仪表

Instrumentation

		(4)	管道安装

Piping installation

		(5)	管道安装及操作指南

Piping installation
and Operating Guideline

 

		4.	气化模型及计算软件描述

Gasification model and
calculation software description

		(1)	模型计算手册及说明;

Model calculation
manual;

		(2)	枣庄、义马、高压PDP的气化模型;

Gasification
model of ZZ, YM, High pressure PDP;

		(3)	SES完成的所有气化模型;

All gasification
model completed by SES;

		(4)	工艺模拟计算软件及应力计算软件的名称和版本要求等

Name and version
requirements of the process simulation calculation software and stress calculation software

 

		5.	枣庄及义马工厂操作数据

ZZ & YM Plant operating
data

		(1)	枣庄工厂运行数据;

Operating
data from September 2010 to September 2011 of ZZ Plant

		(2)	义马工厂部分运行操作数据

Operating
data of YM Plant

 

 

 

 

		6.	枣庄工厂试烧报告

Coal testing reports of
ZZ Plant

		(1)	***

***

		(2)	***

***

		(3)	***

***

		(4)	***

***

		(5)	***

***

 

*** This information has been omitted in
reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

 

		7.	枣庄及义马工厂操作手册

ZZ & YM Plant operating
manual

		(1)	枣庄工厂气化工段操作手册(包括分析、维护文件等);

Gasification
section operation manual of ZZ Plant (including analysis and maintenance documents, etc.)

		(2)	义马工厂气化工段操作手册(包括分析手册、维护手册等);

Gasification
section operation manual of YM Plant (including analytical manual, maintenance manual, etc.)

 

		8.	SES分析研究报告

SES Analysis Report and
Research Report

		(1)	***;

***

		A.	JQ-HCI1012182QD-01(水样)(废水检测)

JQ-HCI1012182QD-01(water
sample)(waste water analysis)

		B.	JQ-HCI1012182QD-02(水样)(废水检测)

JQ-HCI1012182QD-02(water
sample)(waste water analysis)

		C.	JQ-HCI1012182QD-03(水样)(废水检测)

JQ-HCI1012182QD-03(water
sample)(waste water analysis)

		D.	JQ-HCI1012182QD-04(水样)(废水检测)

JQ-HCI1012182QD-04(water
sample)(waste water analysis)

		E.	JQ-HCI1012182QD-05(水样)(废水检测)

JQ-HCI1012182QD-05(water
sample)(waste water analysis)

		F.	JQ-HCI1012182QD-06(水样)(废水检测)

JQ-HCI1012182QD-06(water
sample)(waste water analysis)

*** This information has been omitted in
reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

 

		G.	JQ-HCI1012182QD-07(水样)(废水检测)

JQ-HCI1012182QD-07(water
sample)(waste water analysis)

		H.	JQ-HCI1012182QD-08(水样)(废水检测)

JQ-HCI1012182QD-08(water
sample)(waste water analysis)

		I.	JQ-HCI1012182QD-09(水样)(废水检测)

JQ-HCI1012182QD-09(water
sample)(waste water analysis)

		J.	JQ-HCI1012182QD-10(Gas)(气体检测)

JQ-HCI1012182QD-10(Gas)(gas
analysis)

		K.	JQ-HCI1012182QD-11(Gas)(气体检测)

JQ-HCI1012182QD-11(Gas)(gas
analysis)

		L.	JQ-HCI1012182QD-12(Gas)(气体检测)

JQ-HCI1012182QD-12(Gas)(gas
analysis)

		(2)	***;

***

		A.	***

***

		B.	***

***

		C.	***

***

		D.	***

***

		E.	pall测定(陶瓷过滤器进口粉尘粒径分布)

pall test
(Imported ceramic filter dust particle size distribution)

		F.	高效旋风出囗尘浓测定报告006

High efficiency
cyclone dust concentration measurement report 006

		G.	高效旋风出囗尘浓测定报告

High efficiency
cyclone dust concentration measurement report

		H.	褐煤4#布袋粒径分析报告09.10.18

lignite 4
# bag particle size analysis 09.10.18

		I.	一旋料腿粉尘粒度(美国激光测粒仪)

First cyclone
dipleg dust particle (U.S. laser particle analyzer)

		(3)	煤质试烧煤质分析报告
(褐煤,兖矿峄山试烧煤种,Ambre试烧煤种)

Coal test
analysis reports

		A.	20091013褐煤分析报告_煤科院

20091013 Lignite
Analysis Report_ Coal Research Institute

		B.	***

***

		C.	***

***

*** This information has been omitted in
reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

 

		(4)	义马分布板应力分析

Yima Stress
Analysis

		A.	分布板气化炉有限元分析报告_0828

FEA report
on distributing plate of GASIFIER_0828

		B.	YM炉部件有限元分析条件(Chinese)2012-01-09

YM gasifier
parts finite element analysis conditions(Chinese)2012-01-09

		C.	气化炉分布板有限元分析_技术咨询合同书

Gasifier distribution
plate finite element analysis_ Technical consulting contract

		D.	气化炉壳体上封头接管应力分析报价

Quotation
for stress analysis of head takeover on the gasifier shell

 

		9.	SGT性能保证机制及保证值

SGT
performance guarantee mechanisms and the guaranteed value

		(1)	义马工厂性能保证文件;

Yima plant
performance guarantee documents

		(2)	SES性能保证机制

SES performance
guarantee mechanisms

SGT性能保证的提出是基于大量的模型计算以及工程经验而得到的;是建立在SGT专有技术(技术诀窍)基础上的;是与专有设备结构尺寸紧密相关的;同时,还应该正确的操作运行。SGT性能保证的提出是以上各项的有机结合。

SGT performance guarantees is
proposed based on a large number of model calculation and engineering experience; is built on the basis of SGT proprietary technology
(know-how); is closely related with the proprietary equipment structure size; at the same time, it should be operated properly.
The proposed SGT performance guarantee is an combination of the above.

以义马项目为例,SES共对基准煤种进行了21种工况的模型计算,从中找出各方面最不利工况,将其值做为性能保证值,以确保SGT能够在各种条件下均不超出保证值的限制。

Take Yima project as an example,
SES conducted model calculations of the benchmark coal in a total of 21 kinds of conditions, to find out the most unfavorable conditions
of various aspects, and make it as the performance guaranteed value to ensure that SGT will not exceed the limit of the guarantee
values under all conditions.

SGT模型计算与专有设备(气化炉)的尺寸是紧密联系的,因此,SGT气化炉能够满足基准煤几乎所有的气化操作条件,并且能够在任何条件下均能满足气体成分、气量、消耗、转化率的要求。一般技术许可项目在以下几个方面提供保证:
单炉产气量;底渣含碳量,碳转化率,煤耗,氧耗,CO+H2在干气中的含量,甲烷含量,72小时的运行负荷保证。

SGT model calculation is closely
related with the size of proprietary equipment (gasifier), and therefore, SGT gasifier can satisfy almost all gasification operating
conditions of the benchmark coal, and can meet the requests of gas composition, gas volume, consumption, conversion rate under
all conditions. Generally, technology licensing program is guaranteed in the following aspects: single-furnace gas production;
bottom ash carbon content, carbon conversion rate, coal consumption, oxygen consumption, CO + H2 content in the dry gas, methane
content, 72-hour operation load.

 

		10.	义马项目工程询价资料

Yima Project engineering
quotation material

		(1)	YM气化炉壳体表面测温技术规格书

YM gasifier
shell surface temperature detector specifications

		(2)	气化炉

Gasifier

		(3)	气化炉内件

Gasifier internals

		(4)	气化炉耐火材料招标

Gasifier refractory
tender documents

		(5)	燃烧器

The burner

		(6)	旋风分离器

Cyclone

 

		11.	专有设备图纸及目录

Proprietary equipment drawings
and catalog

		(1)	义马项目专有设备图纸

Proprietary
equipment drawings of Yima project

		A.	旋风分离器

Cyclone

		B.	YM气化炉图(炉体+浇注料)

YM gasifier
drawings (gasifier + castable)

		C.	内件

Internal parts

		D.	排渣管中心管(含喷嘴参数)

Ash discharge
pipe and central jet (including nozzle parameters)

		E.	L阀

L valve

		(2)	枣庄工厂气化炉设备图纸

		A.	气化炉

Gasifier

		B.	HRSG

HRSG

		C.	下灰段

Ash discharge
segment

		D.	旋风分离器

Cyclone

 

		12.	SES专利及目录

SES patents and catalog

		(1)	包括SES申请专利列表及简介。

Including
SES patent list and Introduction

 

 

		13.	专有技术(技术诀窍)描述

Description of Proprietary
technology (know-how)

		(1)	包括专有技术(技术诀窍)的范围、专有技术(技术诀窍)的描述:

Including
rage of proprietary technology (know-how), description of proprietary technology (know-how):

SGT来源于GTI
U-Gas气化技术,U-Gas气化技术经过SES的工程实践,以及不断摸索,开发了适合于多种煤质的气化技术,并形成了具有自身特点的专有技术(技术诀窍)。

SGT is from
GTI U-Gas gasification technology, through SES’ engineering practice and continuous explore, U-Gas gasification technology
was developed for a variety kind of coal, and formed a proprietary technology (know-how)with its own characteristics.

SGT专有技术(技术诀窍)包含(但不限于)以下各项:

SGT proprietary
technology (know-how) includes (but not limited to) the following contents:

		A.	商业机密;

Business
secrets;

		B.	PDP设计,包括模型计算、工艺过程、仪表控制、设备尺寸确定与选型、设备布置等等;

PDP design,
including model calculation, process, instrumentation control, equipment sizing and selection, equipment layout, etc.;

		C.	设计方案;

Design;

		D.	设计图纸;

Design
drawings;

		E.	技术规格书;

Technical
specifications;

		F.	试验数据;

Test data;

		G.	图表;

Graphs;

		H.	制造技巧;

Manufacturing
techniques;

		I.	结构、材料;

Structure,
materials;

		J.	公式、曲线;

Formulas,
curves;

		K.	操作及试验程序;

Operation
and test procedures;

		L.	操作指南/手册。

Operation
guide / manual.

 

		14.	SGT的完整性(SESHK注入到合资公司的SES气化技术的完整性)

The completeness of SGT (the
completeness of SES gasification technology injected into the joint venture by SESHK)

SESHK负责100%提供截止至本合同生效时其拥有的SGT(包括但不限于流程、数据、配方、物料平衡、控制逻辑、程序、说明、设计、草图、照片、企划、图纸、参数、报告、研究、发现等)。包括但不限于本附件所列的内容,针对本附件可能未列明的部分,在未来合资公司经营过程中SESHK也应无条件提供。

SESHK is responsible for providing
100% of SGT it owned before the Effective of this Contract (including but not limited to process, data, formula, material balance,
control logic, procedure, instruction, design, sketch, photograph, planning, drawing, parameter, report, study, and discovery etc.),
including but not limited to the contents of the annex, for the part which may not be listed in this Annex, SESHK should also provide
to Company unconditionally during the Company operation.

 

 

    	 

    	 

    

 

ANNEX 3

 

DATED the XX day of Month 20XX

 

zcm-ses
Sino-US Clean Energy tECHNOLOGIES CO., lTD.

 

and

 

NAME

 

________________________________________________________

 

TECHNOLOGY LICENSE AGREEMENT

_________________________________________________________

 

    	1

    	 

    

 

TABLE OF CONTENTS

 

	1.	GRANT
    AND REGISTRATION	5
	 	 	 
	2.	EFFECTIVE
    DATE	6
	 	 	 
	3.	Licensed
    Facility AND GASIFICATION CAPACITY	6
	 	 	 
	4.	PRICE	
	 	 	 
	5.	PURCHASE
    OF KEY EQUIPMENTS AND PLANTS	
	 	 	 
	6.	NOT APPLICABLE	
	 	 	 
	7.	IMPROVEMENT
    AND DEVELOPMENT	9
	 	 	 
	8.	CONFIDENTIALITY
    AND NON-DISCLOSURE	10
	 	 	 
	9.	NOT APPLICABLE	
	 	 	 
	10.	REPRESENTATIONS
    AND WARRANTIES	12
	 	 	 
	11.	GUARANTEES	14
	 	 	 
	12.	CONFIDENTIAL
    INFORMATION ENFORCEMENT	15
	 	 	 
	13.	NOTICES	15
	 	 	 
	14.	TERM AND
    TERMINATION	16
	 	 	 
	15.	ALLOCATION
    OF RISK OF LOSS; LIMITATION OF LIABILITY	17
	 	 	 
	16.	PARTIES
    BOUND	18
	 	 	 
	17.	PUBLICITY	18
	 	 	 
	18.	SEVERABILITY	18
	 	 	 
	19.	ENTIRE
    AGREEMENT	19
	 	 	 
	20.	FORCE MAJEURE	19
	 	 	 
	21.	DISPUTE
    SETTLEMENT & GOVERNING LAW	19
	 	 	 
	22.	GENERAL	20
	 	 	 
	23.	LANGUAGE	22

 

    	2

    	 

    

 

	APPENDIX
    A DEFINITIONS AND INTERPRETATION	24
	 	 
	APPENDIX B
    DESIGN BASIS COAL	28
	 	 
	APPENDIX C
    PROCESS DESIGN PACKAGE (PDP) SERVICES AND SCOPE OF WORK	29
	 	 
	APPENDIX D
    TECHNICAL SERVICE	36
	 	 
	APPENDIX E
    PERFORMANCE TEST PLAN	37
	 	 
	APPENDIX F
    ESTIMATED TECHNICAL SERVICE MANHOURS AND COSTS	 

 

    	3

    	 

    

 

THIS TECHNOLOGY LICENSE AGREEMENT (herein
referred to as the "License Agreement" or this “Agreement”) is made this XX day of MONTH,
20XX.

BETWEEN

 

		(1)	zcm-ses
                                         Sino-US Clean Energy tECHNOLOGIES CO., lTD. a joint [inset current JV address
                                         at time] (hereinafter referred to as "Licensor");

 

		(2)	LICENSEE NAME, DESCRITION
                                         AND ADDRESS (hereinafter referred to as the "Licensee").

 

Terms not otherwise defined
have the meanings set forth in Appendix A of this Agreement.

 

WHEREAS:

 

		(1)	The NAME OF LICENSEEE IS a duly incorporated
                                         company under the laws of PRC with its registered office at ADDRESS

 

		(2)	The Company (SES-ZCM), a duly incorporated
                                         company under the laws of PRC with its registered office at ADDRESS

 

		(3)	SES Gasification Technology (SGT)
                                         [NOTE A NEW BRAND MAY BE INSERTED HERE] is a leading global gasification technology which
                                         utilizes a proprietary and advanced fluidized bed reactor system that has been extensively
                                         developed since 2004 and was initially based upon the U-Gas® technology licensed
                                         by SES and/or its Affiliates from GTI and further developed through additional improvements,
                                         know-how and patents developed by SES and/or its Affiliates through industry experience
                                         from developing, designing, constructing and operating projects in China and from designs
                                         made by SES and/or its Affiliates in developing projects globally. The SGT is specifically
                                         well suited for clean and efficient gasification of a wide range of low quality coals,
                                         coal wastes, biomass, municipal waste and other carbonaceous materials and uses much
                                         less water than competing gasification technologies. The SGT technology is also recognized
                                         for its scalability from small syngas capacity to world scale syngas capacity and for
                                         its ability to be built at lower capital costs than many other competing gasification
                                         technologies.

 

    	4

    	 

    

 

		(4)	The Licensor holds the exclusive
                                         rights in China, Indonesia, Malaysia, Philippines, Mongolia and Vietnam to sub-license
                                         the SGT as defined in this agreement, and the Parties have agreed that the [NAME OF LICENSEE
                                         PROJECT] (the “Project”) contemplated in this Agreement will utilize the
                                         SGT.

 

		(5)	The Agreed Technical Objective of
                                         the Parties is to authorise and enable the Licensee to use the SGT to produce up to [X,XXX,XXX]
                                         Normal Cubic Meters per Day (dry basis) of a mixture of Carbon Monoxide (CO), Hydrogen
                                         (H2) and Methane (CH4) in the gas produced from the SGT, otherwise referred to as syngas
                                         [Note; Syngas may also be defined as containing CH4 when applicable] “Dry Net Syngas”
                                         and is measured at the syngas outlet of the SGT syngas scrubber using the Project Design
                                         Basis FEEDSTOCKl.

 

NOW, THEREFORE, for and in consideration
of the above premises and of the undertakings hereinafter set forth, the Parties hereby agree to be legally bound as follows:

 

		1.	GRANT AND REGISTRATION

 

		1.1	Licensor hereby grants to Licensee
                                         and Licensee hereby accepts from Licensor, subject to the terms of this License Agreement
                                         (including without limitation Section 3.1), a non-exclusive, non-transferable license,
                                         without the right to sub-license, to:

 

		1.1.1	use the SGT for the purposes
                                         and within the confines of the Project to manufacture syngas in the Project pursuant
                                         to the Designed Capacity outlined in Section 3.1; and

 

		1.1.2	to use the Know-How to practice
                                         the SGT for the production of syngas in the Licensed Facility which, in Licensor's sole
                                         opinion, is necessary for the design and operation of a facility for the production of
                                         syngas through the SGT and which Know-How is in the possession or control of Licensor.

 

		1.2	The license grant set forth in this
                                         Agreement shall come into force on the Effective Date.

 

    	5

    	 

    

 

		1.3	Except as set forth in this Section
                                         1, or otherwise authorised by Licensor in writing, Licensee and its Affiliates shall
                                         not use the SGT in any other manner.

 

		1.4	Licensee shall be responsible for
                                         properly registering this License Agreement with the relevant authorities in accordance
                                         with PRC laws and regulations applicable to this License Agreement within ten (10) days
                                         of the later of execution of this Agreement. [Note: OTHER CONDITIONS MAY APPLY SUCH AS
                                         ESTABLISHING THE PROJECT JV COMPANY].

 

		2.	EFFECTIVE DATE

 

This License Agreement shall
be signed by the authorised representative of all Parties on the respective dates set forth on the signature page of this License
Agreement and shall immediately become effective upon signing and the satisfaction of the following conditions, which together
which shall be taken as the Effective Date of this Agreement:

 

		2.1	The Licensee has fully paid its first
                                         milestone payment, the Down Payment, and which Down Payment amount has been fully received
                                         by the Licensor.

 

		2.2	The Licensee has fully paid its first
                                         PDP payment and which such PDP payment amount has been fully received by the Licensor.

 

		2.3	[NOTE: OTHER CONDITIONS MAY APPLY
                                         ON A CASE BY CASE BASIS AS THE LICENSOR DEEMS APPROPRIATE]

 

		3.	LICENSED SYNGAS CAPACITY

 

		3.1	Licensee shall build the Licensed
                                         Facility with a total Dry Net Syngas capacity as measured at the outlet of the SGT syngas
                                         scrubber not to exceed [X,XXX,XXX] Normal Cubic Meters per Day (dry basis) of a mixture
                                         of Carbon Monoxide, CO plus Hydrogen, H2 [Note; dry net Syngas may also be defined as
                                         containing CH4 when applicable] using the Project Design Basis FEEDSTOCK.. The license
                                         granted herein is only for the Licensed Facility Designed Capacity at the Licensed Facility,
                                         which shall be detailed in the project’s PDP Design Basis, and does not include
                                         any subsequent project expansions. Licensee may, however, operate the Licensed Facility
                                         at a capacity of 10% above the Licensed Facility Designed Capacity without any additional
                                         payment to Licensor so long as such additional syngas is produced by the number of gasifiers
                                         as set out in the PDP Design Basis. For the avoidance of doubt, should Licensee wish
                                         to add any additional gasification capacity beyond what is stated in the PDP Design Basis,
                                         then Licensee shall first pay an additional license fee to Licensor as is described in
                                         Section 4.3.1.

 

    	6

    	 

    

 

		3.2	With respect to the SGT engineering,
                                         operating guidelines and Technical Services for commissioning and start-up, Licensor
                                         will provide (either directly or through subcontractors) the PDP Services and the Basic
                                         Technical Services described in this Agreement, The Licensee may additionally enter into
                                         a separate Technical Services Agreement for Additional Technical Servcies for ongoing
                                         support of the Licensed Facility.

 

		3.3	With respect to SGT Proprietary Equipment,
                                         Licensee will enter into a separate SGT Proprietary Equipment Supply Agreement with Licensor
                                         for supply of the SGT Proprietary Equipment as listed in Appendix [X]
                                         of this agreement.

 

		3.4	Licensor's representatives shall
                                         have reasonable access to the Licensed Facility, for general visits by Licensor and its
                                         Licensees and other prospective customers and business partners, for the purpose of promoting
                                         and informing these parties regarding the SGT. Such visitations will be requested by
                                         Licensor with reasonable advance notice and permission to visit the Licensed Facility
                                         and should not be unreasonably withheld by the Licensee. Such visits shall take place
                                         at such times as reasonably agreed upon between the Parties so as not to interfere with
                                         the operations of the Licensed Facility or otherwise cause significant inconvenience
                                         for Licensee, and Licensee shall have a right to monitor such visits to ensure that Licensee’s
                                         operations are not affected.

 

		3.5	Licensor's representatives shall
                                         have the right and the responsibility to be present and provide technical advice at the
                                         Licensed Facility for the entirety of the first continuous 72 hours of operational use
                                         or any subsequent Performance Test that is conducted.

 

		4.	CONSIDERATION

 

		4.1	LICENSE FEE: As consideration for
                                         the license grants from Licensor to Licensee pursuant to this Agreement, Licensee shall
                                         pay to Licensor a License Fee equal to RMB [XXXXXXX] for the Dry Net Syngas production
                                         rate as measured at the outlet of the SGT Syngas Scrubber, the Designed Capacity.

 

    	7

    	 

    

 

		4.2	PAYMENT OF LICENSE FEE: The License
                                         Fee shall be paid in four instalments by Licensee to Licensor. The first payment of 20%
                                         of the total License Fee “the Down Payment” shall be paid by Licensee within
                                         ten (10) days of signing this Agreement and upon receipt of such payment by Licensor
                                         this Agreement shall become effective as described in Section 2; the second payment of
                                         50% of the total License Fee shall be paid by Licensee within ten (10) days of the delivery
                                         of the PDP to the Licensee; the third payment of 20% of the total License Fee shall be
                                         paid within ten (10) days of delivery of all SGT Proprietary Equipment to the Licensed
                                         Facility and the final payment of 10% of the total License Fee shall be paid within ten
                                         (10) days of the earliest of (i) completing the SGT performance test or (ii) within 12
                                         months of delivery of all SGT Proprietary Equipment to the Licensed Facility.

 

		4.3	If the Licensee expands or otherwise
                                         increases the production of Dry Net Syngas beyond 10% of the Designed Capacity of the
                                         Licensed facility, an Additional License Fee shall be paid by Licensee to Licensor based
                                         the calculation as follows.

 

		4.3.1	Additional License Fee
                                         = [Additional Capacity in Normal Cubic Meters per day] X [YYRMB per Normal Cubic Meter
                                         of Dry Net Syngas]

 

		4.4	A separate PDP Fee of RMB [XXXXXXX]
                                         shall be paid by Licensee to Licensor in compliance with the Agreement. The PDP Fee shall
                                         be paid in two equal payments of 50% each. The first payment of RMB [YYYYYYY] shall be
                                         paid within ten (10) days upon the Effective Date of this Agreement and the second payment
                                         of RMB [YYYYYYY] shall be paid within ten (10) days delivery of the final PDP to the
                                         Licensee.

 

		4.5	Basic Technical Services as described
                                         in Appendix (?) are included in the License Fee. A separate fee of RMB [XXXXXXX] for
                                         Additional Technical Services as described in Appendix [X] shall be paid by Licensee
                                         to Licensor. The payment schedule for Additional Technical Services shall be [TO BE DETERMINED]

 

		4.6	All payments to Licensor by Licensee
                                         under this Agreement and the appendices hereof shall be paid to the following bank account
                                         designated by Licensor:

 

Company
Name: [INSERT]

 

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Bank Name:
[INSERT]

 

		5.	ACCOUNTING AND REPORTING 

 

		5.1	During the term of this Agreement,
                                         the Licensee shall furnish to Licensor basic SGT operating data on an annual basis. This
                                         list of required annual operating data is described in Appendix [X] and is the operating
                                         performance data related to the Licensed Facility. [Note: This is Intended to be coal
                                         consumption and composition, oxygen consumption, gasifier operating pressure and temperature,
                                         fines and ash composition and production rates and syngas production rates and composition.]

 

		6.	TAXES AND DUTIES

 

		6.1	Licensee is solely responsible for
                                         any taxes or fees imposed on any payment by Licensee to Licensor under this Agreement,
                                         including, without limitation, for business tax, income tax, and withholding taxes. For
                                         the avoidance of doubt Licensee is responsible for the payment of the additional five
                                         percent (5%) business tax which is levied by the Chinese Government on payments made
                                         pursuant to this Agreement. In the event that Licensee is required under applicable law
                                         to withhold taxes or any other amount from any sum payable to Licensor under this Agreement,
                                         such sum payable under this Agreement shall be increased such that the payment made by
                                         Licensee to Licensor equals the sum that would be otherwise payable if such taxes were
                                         not required to be withheld hereunder.

 

		7.	IMPROVEMENT AND DEVELOPMENT 

 

		7.1	If Licensor, should make, or acquire
                                         without obligation to account therefor, to any third party any improvements, whether
                                         patentable or not, relating to SGT, then Licensor hereby grants to Licensee and to SESHK
                                         the irrevocable, non-exclusive right to use such improvements in the Licensed Facility
                                         and agrees to make such improvements available to Licensee and SESHK without accounting
                                         or payment. All such improvements disclosed to Licensee and SESHK by Licensor shall become
                                         and thereafter be a part of Licensor's and SESHK’s Know-How and Licensee shall
                                         have the same rights, licenses and obligations with respect thereto as are granted to
                                         Licensee herein with respect to Licensor's and SESHK’s Know-How except for the
                                         warranties or guarantees of Sections 10 and 11 and the defence of suits and indemnifications
                                         of Section 9

 

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		7.2	If Licensee should make any modifications
                                         changes and/or improvements, whether patentable or not, relating to SGT (together "Licensee
                                         Improvements") then Licensee shall forthwith disclose these, with associated
                                         written submissions, to Licensor and SESHK.

 

		7.3	Licensee shall make Licensee Improvements
                                         available to Licensor and SESHK upon request. Licensee grants to Licensor and SESHK,
                                         without accounting or payment, an irrevocable, royalty-free license to use any Licensee
                                         Improvements in Licensor’s exclusive Territory and outside such Territory to SESHK.
                                         Licensor and SESHK shall have the right to sublicense the right to use Licensee Improvements
                                         without any payment due to the Licensee. However, the ownership of any Licensee Improvements
                                         shall belong to Licensee.

 

		7.4	The Parties understand and agree that
                                         the rights granted to Licensor in Section 7.3 permit Licensor and SESHK to grant licenses
                                         and rights to use Licensee Improvements without any obligation to account to Licensee
                                         thereof. Licensor shall not, however, disclose Licensee Improvements to third parties
                                         beyond that commercially necessary to exercise the rights granted to Licensor in Section
                                         7.3.

 

		8.	CONFIDENTIALITY
                                         AND NON-DISCLOSURE

 

		8.1	The Licensee acknowledges that the
                                         Licensor own and/or controls certain information and trade secrets relating to the Know-How
                                         and SGT which is confidential and which affords the Licensor an advantage over its competitors
                                         which do not have such information. For the purposes of this License Agreement, information
                                         required to be maintained secret is defined to be all Confidential Information (including
                                         Know-How) and any information related thereto and to the SGT which is disclosed by Licensor
                                         to Licensee pursuant to this License Agreement or by any other means at any other time.

 

		8.2	All Licensor’s and/or SESHK’s
                                         Confidential Information (including Know-How) disclosed pursuant to this License Agreement
                                         by Licensor shall remain the property of Licensor and shall be kept confidential by Licensee.

 

    	10

    	 

    

 

		8.3	Licensee undertakes that Licensee:

 

		8.3.1	Will not publish, reproduce,
                                         or disclose the Confidential Information to any third party (including without limitation
                                         to any contractor, affiliate, agent, or customer) without the prior written consent of
                                         Licensor; will limit access to such Confidential Information to Licensee’s employees
                                         that are directly involved in the Licensed Facility and will be responsible for any breach
                                         by such persons;

 

		8.3.2	Will not use the Confidential
                                         Information for any purposes other than the purposes of this Agreement;

 

		8.3.3	Will employ the same degree
                                         of care in protecting the Confidential Information as it employs in protecting its own
                                         confidential information of similar import, but not less than a reasonable degree of
                                         care; without limiting the foregoing, will not copy any Confidential Information, except
                                         as may be required for the purpose of this Agreement, and will store such Confidential
                                         Information in a secure place;

 

		8.3.4	Will not disclose in any manner
                                         to any person or concern and will not use, except pursuant to this License Agreement,
                                         any of the Confidential Information.

 

		8.4	Licensee hereby agrees to indemnify
                                         and hold harmless Licensor against any liability or loss resulting from unauthorized
                                         disclosure or use of the Confidential Information by itself, its agents, or its Affiliates,
                                         to whom the Confidential Information is disclosed pursuant to this License Agreement.
                                         No indemnity payments hereunder shall relieve Licensee from liability under applicable
                                         patent, copyright or trade secrets laws, nor shall such payments constitute a grant or
                                         continuation of a grant of any express or implied license or covenant not to sue under
                                         any patents, copyrights or trade secrets of Licensor.

 

		8.5	In the event that Licensee is required
                                         to disclose all or any part of the Confidential Information by law, regulation, subpoena
                                         or court order, Licensee agrees (i) to notify Licensor and SESHK immediately of any such
                                         requirement; (ii) to consult with Licensor and Licensee shall make its best efforts to
                                         take appropriate measures to avoid such disclosure, and if such disclosure is required,
                                         to narrow the scope and depth of such disclosure to only what is required by law. If
                                         the disclosure becomes unavoidable, Licensee shall send to Licensor and SESHK a copy
                                         of the disclosed Licensor’s Confidential Information coincidental with the transmission
                                         of the Confidential Information to the relevant government agency.

 

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		9.	INDEMNIFICATION

 

			Licensee agrees to hold harmless, defend
                                         and indemnify Licensor ("Indemnified Party") against all damage, expense
                                         and liability, including attorneys fees, resulting from injury to or death of any person
                                         or damage to any property, in either case by reason of Licensee's use of the Know-How
                                         or the SGT in a manner other than as contemplated in this Agreement and/or in any relevant
                                         project design document. Licensor reserves the right to be separately represented, at
                                         its own expense, by legal counsel of its choice, in any proceedings arising out of or
                                         in connection with a claim for indemnification under this Section 9.

 

		10.	REPRESENTATIONS AND WARRANTIES

 

	10.1	Licensor represents that at the time
                                         of execution hereof:
	 	 

		(a)	there are no agreements, assignments,
                                         encumbrances or licenses in existence that are inconsistent with the provisions of this
                                         License Agreement;

 

		(b)	Licensor owns or has a right
                                         to license all right, title and interest in and to SGT licensed to Licensee hereunder;

 

		(c)	The SGT licensed to Licensee
                                         hereunder are not known to infringe upon or otherwise violate, nor to be inconsistent
                                         with, the rights of any other person or entity; and

 

		(d)	There are no disputes, conflicts,
                                         claims (actual or threatened), actions, litigation, arbitrations, suits, proceedings,
                                         judgments, or decrees existing, pending, threatened by or against, or affecting or relating
                                         to the SGT licensed to Licensee hereunder.

 

		10.2	Licensor warrants that the SGT is
                                         complete, effective and can achieve the Agreed Technical Objective, provided it is used
                                         by the Licensee strictly in compliance with this License Agreement (including the PDP,
                                         and the recommendations during the Technical Services). Licensee acknowledges and agrees
                                         that Licensor makes no warranty or representation regarding the sufficiency of the SGT
                                         to manufacture Dry Net Syngas beyond the Designed Capacity permitted under this License
                                         Agreement.

 

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		10.3	Licensor warrants that the SGT to
                                         be supplied shall be in complete, clear, and intelligible form and be sufficient for
                                         the Licensee to use to complete basic and detailed engineering for the Licensed Facility.
                                         If the PDP delivered by Licensor does not meet the Agreed Technical Objective and after
                                         receipt of written notice from Licensee, Licensor shall be responsible for corrections
                                         to the PDP at its own cost and shall make delivery of the corrected or supplemented portion
                                         of the PDP within the time as may be mutually agreed.

 

		10.4	Beginning upon the Effective Date
                                         and ending upon completion of the Performance Test (or in respect of Technical Services
                                         upon completion of such Technical Services, if later than completion of the Performance
                                         Test), Licensor warrants that the work and services furnished by it shall be performed
                                         in accordance with accepted engineering practices. As long as Licensee provides prompt
                                         written notice to Licensor of non-conformance, Licensor shall re-perform the affected
                                         work or services. Licensee's sole remedy and Licensor's sole liability for any breach
                                         of the foregoing or any other potential or actual liability arising under this Section
                                         10 shall be the re-performance of such work or services.

 

		10.5	Licensee acknowledges and agrees
                                         that Licensor makes no representation or warranty, express or implied, concerning (i)
                                         the results to be obtained utilizing the SGT or (ii) (save as represented at Section
                                         10.1(d) above) whether Licensee’s implementation of the SGT and other rights granted
                                         herein to manufacture, make, operate and use SGT may infringe upon the patent or other
                                         intellectual property rights of third parties and the grant of rights by Licensor to
                                         Licensee shall in no way be construed as an inducement to Licensee to infringe the patent
                                         or other intellectual property rights of others. EXCEPT AS OTHERWISE EXPRESSLY SET FORTH
                                         IN THIS AGREEMENT, NEITHER LICENSOR, ITS AFFILIATES OR LICENSORS NOR THEIR RESPECTIVE
                                         DIRECTORS, OFFICERS, EMPLOYEES OR AGENTS MAKE ANY REPRESENTATIONS OR WARRANTIES OF ANY
                                         KIND, EITHER EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF MERCHANTABILITY,
                                         FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT, PURSUANT TO THIS AGREEMENT. ALL
                                         RIGHTS GRANTED HEREIN WITH RESPECT TO LICENSEE DEVELOPMENTS ARE EXPRESSLY GRANTED ON
                                         AN “AS IS” BASIS AND WITHOUT ANY WARRANTIES.

 

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		11.	GUARANTEES

 

		11.1	Provided that the Licensed Facility
                                         has been built in accordance with the PDP by an Acceptable Contractor and is operated
                                         as described in the PDP by the Licensee and provided that the [FEEDSTOCK] gasifier in
                                         the Licensed Facility has the chemical and physical properties specified in the PDP Design
                                         Basis for the Licensed Facility and subject to the qualifications set forth in Section
                                         11.1.1 Licensor will guarantee the SGT performance as follows:

 

		11.1.1	Design Basis [FEEDSTOCK]
                                         (dry basis) consumed in the SGT gasifier reactor of [XX] kilograms per Nm3
                                         of Dry Net Syngas produced. This quantity of [FEEDSTOCK] will be confirmed upon completion
                                         of the PDP Design Basis.

 

		11.1.2	Oxygen (pure basis) consumed
                                         in the SGT gasifier will not be in excess of [XX] Nm3 of oxygen per Nm3
                                         of Dry Net Syngas produced. This quantity of oxygen will be confirmed upon completion
                                         of the PDP Design Basis document.

 

		11.1.3	At least [XX] Nm3
                                         of Dry Net Syngas per normal operating day will be produced by the SGT from the Licensed
                                         Facility during a continuous twenty-four (24) hours. The Performance Test Plan shall
                                         be implemented in accordance with Appendix ? hereof.

 

		11.2	For the avoidance of doubt, SGT shall
                                         be deemed capable of conforming to the requirements of this Agreement and/or any project
                                         design document, upon the Licensed Facility passing the Performance Test.

 

		11.3	In the event that the SGT does not
                                         meet the guarantee as provided in this Section 11, the Licensee shall notify the Licensor
                                         in writing, whereupon the Licensor shall rectify the non-performance within a cure period
                                         of [90] days. In the event, thereafter, of a continuing non-performance the Licensor
                                         shall reimburse the Licensee 50% of the License Fee actually paid by the Licensee at
                                         the time of such breach. For the avoidance of doubt, this remedy and limitation is consecutive
                                         with, and not additional to the limitation provided under Section 15.4.

 

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		12.	.CONFIDENTIAL INFORMATION ENFORCEMENT

 

		12.1	Upon learning of the possible misuse
                                         or misappropriation of the Confidential Information or any other confidential information
                                         accruing to Licensor by a third party, Licensee shall inform Licensor and SESHK of that
                                         fact, and shall supply Licensor and SESHK with any evidence available to it pertaining
                                         to the possible misuse or misappropriation.

 

		12.2	When Licensee mentions the SGT that
                                         is the subject matter of this License Agreement in writing in any press release or other
                                         promotional documentation, Licensee shall include [INSERT PROPER BRANDED NAME HERE] in
                                         said release or promotional documentation.

 

		13.	NOTICES

 

		13.1	Notices or other communication required
                                         to be given to either Party shall be given by registered mail, express mail or facsimile
                                         to the following addresses or such other addresses as designated by the Parties from
                                         time to time:

 

To
Licensee:

Address:

Post
Code: 472300

Fax:
(86-0398) 5898-906

For
the attention of: 

 

To
Licensor:

Address:      [NAME
OF THE COMPANY], 526 Pine City Center, 777 Zhao Jia Bang Road, Shanghai China,

Post
Code: 200032

Fax:
(86-21) 6422-0869

 

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For
the attention of: 

 

TO SESHK:

 

		13.2	Notices given to Licensee by registered
                                         mail or facsimile shall be written in Chinese, and notices given to Licensor by registered
                                         mail or facsimile shall be written in Chinese or English. Notices shall be deemed to
                                         have been effectively given under the following circumstances:

 

		(1)	Notices given by express delivery
                                         shall be deemed effective when recipient signs for the delivery at the designated address;

 

		(2)	Notices given by registered
                                         mail shall be deemed effective on the seventh day after the date on which they were sent
                                         by registered airmail, postage prepaid (as indicated by the postmark).

 

		(3)	Notices given by facsimile
                                         transmission shall be deemed effective on the first business day (at the location of
                                         the recipient) following the date of transmission, if confirmed.

 

		14.	TERM AND TERMINATION

 

		14.1	Unless previously terminated in accordance
                                         with its terms, after the Effective Date, this License Agreement shall remain in place
                                         until the 10th anniversary date. Upon expiration of this Agreement, the Licensee
                                         may use the license granted under this Agreement in respect of the Licensed Facility
                                         and gasification capacity under this Agreement..

 

		14.2	Any of the following rights and obligations
                                         of Licensee or Licensor shall survive the termination of this License Agreement: (i)
                                         such termination shall not relieve either Party of any obligation or liability accrued
                                         hereunder prior to the termination; (ii) such termination shall not affect in any way
                                         the then existing licenses, rights and powers granted or agreed to be granted by, or
                                         obligations of the Parties under Section 7 (Improvement and Development); (iii) such
                                         termination shall not affect the obligations of the Parties under Section 4 (Price),
                                         Section 8 (Confidential Information and Non-Disclosure), Section 12 (Confidential Information
                                         Enforcement), Section 15 (Allocation of Risk of Loss; Limitation of Liability), Section
                                         17 (Publicity) and Section 21 (Dispute Resolution).

 

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		14.3	If there are unreasonable delays
                                         in the fulfilment or substantial incorrect fulfilment of a Party's obligations pursuant
                                         to this License Agreement, the other Party shall have the right to terminate this License
                                         Agreement by giving the defaulting Party at least thirty (30) days prior written notice
                                         of the intent to terminate. Said prior written notice shall specify the default in performance.
                                         The defaulting Party shall (i) notify the other Party within fifteen (15) days after
                                         receiving the written notice that it can either cure the default in performance within
                                         the thirty (30) days or if such default is not capable of cure within said period then
                                         (ii) promptly arrange a meeting between the Parties to discuss extension of the cure
                                         date. In the event the Parties cannot agree to extend the cure date or the default is
                                         not cured by the mutually agreed extended due date, then the non-defaulting Party can
                                         terminate the License Agreement on the extended cure due date or seventy-five (75) days
                                         after the first notice of the intent to terminate, whichever occurs last.

 

		15.	ALLOCATION OF RISK OF LOSS; LIMITATION
                                         OF LIABILITY

 

		15.1	Licensee understands and agrees that
                                         Licensor's maximum liability under this Agreement is limited to that which is set forth
                                         in Section 15.3, 15.4 and 15.5.

 

		15.2	Licensor shall have no liability
                                         to Licensee or to third parties for any injuries to person and/or property, arising out
                                         of or in connection with the design or construction, of the Licensed Facility or arising
                                         out of or in connection with this License Agreement to the extent such liabilities may
                                         be excluded or limited by applicable law.

 

		15.3	Neither Party shall be liable to
                                         the other Party under this License Agreement for any loss of revenues or profits, shutdown
                                         or non-operation of the Licensed Facility, or any special or consequential loss or damage
                                         arising from any cause whatsoever, regardless of whether such losses or damages were
                                         foreseen by the Parties. Licensee's remedies as set forth herein are exclusive and are
                                         in lieu of any and all other remedies. Therefore, Licensor's liability under this License
                                         Agreement is restricted only to those set forth in Section 15.4 of this License Agreement.

 

		15.4	Save
                                         to the extent such liabilities may be excluded or limited by applicable law, in no event
                                         shall Licensor's liability under this License Agreement and/or any other agreement between
                                         Licensor and Licensee related to the Licensed Facility, irrespective of whether caused
                                         by Licensor's fault or negligence, exceed fifty percent (50%) of the License Fee actually
                                         paid by the Licensee at that date. [Note: The value and/or cost to Licensor of all and
                                         any attempts at curing non-performance shall be taken into consideration when calculating
                                         this liability cap.]

 

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		15.5	Notwithstanding sections 15.3 and
                                         15.4, Licensee's sole remedy in respect to defects within the PDP Services and/or the
                                         Technical Services shall be re-performance of the defective work.

 

		16.	PARTIES BOUND

 

This License Agreement shall
benefit and be binding upon the Parties hereto and their respective successors and assigns; provided, however, that neither Party
shall assign any of the rights and privileges granted or be relieved of its obligations hereunder without the prior written consent
of the other Party.

 

		17.	PUBLICITY 

 

		17.1	Licensor and Licensee shall each
                                         be permitted to issue press releases or otherwise publicise the fact that the Parties
                                         have entered into this License Agreement and may describe the general nature of this
                                         License Agreement in any publication, written or otherwise, provided, however, that Licensor
                                         and Licensee shall first mutually agree on the content of the subject matter contained
                                         in any such publication. Licensor and Licensee shall also mutually agree upon the content
                                         of releases of information available for public review or inspection.

 

		18.	SEVERABILITY

 

No amendment to or modification
of, any provision of this License Agreement will be valid unless in writing and signed by an authorised representative of each
of the Parties.

 

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		19.	ENTIRE AGREEMENT

 

This License Agreement represents
the entire agreement between the Parties with respect to its subject matter, and there are no other representations, understandings
or agreements between the Parties relative to such subject matter. Notwithstanding the foregoing, neither Party shall be relieved
of its obligations with respect to any information subject to the provisions of any confidentiality agreement entered into by
the Parties prior to the Effective Date.

 

		20.	FORCE MAJEURE 

 

In the event
that the performance of this Agreement is directly affected or that the Agreement cannot be performed in accordance with the agreed-upon
terms and conditions due to a Force Majeure event (any event that is uncontrollable, unforeseen and unavoidable), the Party affected
by the above Force Majeure events shall do its utmost to reduce the damages to the lowest extent, notify the other Party of the
situation resulting from such events, and provide a detailed report on the Force Majeure event together with a valid document
evidencing the reasons for which this Agreement cannot be performed fully or partially or why performance must be delayed within
fifteen (15) days of the occurrence of such Force Majeure event. Such documents shall be issued by the notary public organization
or the relevant state agencies at the location in which such Force Majeure event occurred. The Parties shall hold discussions
and consultations to decide whether this Agreement shall be terminated, whether the affected Party shall be fully or partially
exempted from the responsibility to perform this Agreement or whether the affected Party shall be given an extension of the Term.

 

		21.	DISPUTE SETTLEMENT & GOVERNING
                                         LAW 

 

		21.1	Any dispute, difference or claim
                                         arising out of or in connection with this Agreement, shall, in the first instance, be
                                         resolved through friendly negotiation. If a dispute cannot be resolved within thirty
                                         (30) days after such claiming Party delivering written notice to the other Party, then
                                         it shall be referred on application by either Party to CIETAC and shall be determined
                                         by arbitration in accordance with the provisions of this section:

 

		(q)	any such arbitration shall
                                         be conducted in accordance with the CIETAC Arbitration Rules and the provisions of this
                                         Article 60;

 

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		(r)	the arbitration tribunal shall
                                         consist of three arbitrators, one appointed by Licensor, one by Licensee and the third
                                         arbitrator (the “Presiding Arbitrator”) appointed by agreement between
                                         the Parties, or, if the Parties cannot agree, by the Chairman of CIETAC, subject to the
                                         criteria set out in sub-Article (3) below;

 

		(s)	the Presiding Arbitrator may
                                         not be (i) a national of the PRC or of the United States of America or (ii) a permanent
                                         resident or citizen of the Hong Kong Special Administrative Region or Macau Special Administrative
                                         Region or Taiwan Province, and if either of the Parties fails to appoint an arbitrator
                                         within the time specified in the CIETAC Arbitration Rules, the Chairman of CIETAC shall
                                         make such appointment in accordance with the criteria agreed herein;

 

		(t)	the place of arbitration shall
                                         be Shanghai and the arbitration shall be conducted in the English and Chinese languages;

 

		(u)	any arbitral award shall be
                                         final and binding;

 

		(v)	the costs of the arbitration,
                                         the arbitration fees and the liability for other expenses shall be borne by the losing
                                         Party, unless otherwise determined by the arbitration tribunal.

 

		(w)	each Party waives any right
                                         to contest the jurisdiction of CIETAC to hear and to determine any arbitration begun
                                         pursuant to this Article 60;

 

		21.2	During the Dispute Resolution Procedure,
                                         except for the relevant matter(s) relating to the arbitration, the Parties shall continue
                                         to exercise their respective rights under this Agreement, and continue to perform their
                                         respective obligations.

 

		21.3	The execution, effectiveness, interpretation,
                                         performance of this Agreement and the settlement of disputes shall be governed by PRC
                                         law

 

		22.	GENERAL

 

		22.1	No relaxation, forbearance, delay
                                         or indulgence by either Party in enforcing any term or condition of this License Agreement,
                                         or the granting of time by either Party to the other, shall prejudice, affect or restrict
                                         the rights and powers of that Party, nor shall any waiver by either Party of any breach
                                         of this License Agreement operate as a waiver of, or in relation to, any subsequent or
                                         continuing breach of it.

 

		22.2	If any part of this License Agreement
                                         shall be found to be invalid all the remaining parts shall remain valid.

 

    	20

    	 

    

 

		22.3	This License Agreement shall not
                                         be assignable by either Party except that either Party may assign all of its rights hereunder
                                         together with all of its obligations hereunder to an Affiliate, any third party with
                                         which it may merge or consolidate or to a purchaser of substantially all of the assets
                                         of such Party. The Parties shall notify each other hereunder immediately of any assignment
                                         made pursuant to this Section 22.3. This License Agreement shall be binding upon and
                                         inure to the benefit of the Parties hereto, and their respective heirs, assigns, successors,
                                         and legal representatives. However, should Licensor be dissolved or wound up or should
                                         the Technology Usage and Contribution Agreement between the Licensor and SESHK be terminated,
                                         all Licensor’s rights hereunder shall automatically be assigned to SESHK.

 

		22.4	No Party hereto will be entitled
                                         to make commitments on behalf of or bind any other Party other than those acts that are
                                         expressly authorised under this Agreement. Nothing in this License Agreement will be
                                         construed to authorise any Party to act as an agent for any other Party or to hold itself
                                         out as having the authority or right to assume, create, or undertake any obligations
                                         of any kind whatsoever, express or implied, on behalf of or in the name of any other
                                         Party without the express prior written consent of the other Party.

 

		22.5	The Parties hereby acknowledge and
                                         agree that the Parties, and shall ensure the officers and employees of the Parties, will
                                         observe in a strict manner all Applicable Laws including all anti-corruption regulations,
                                         and have not made and will not make directly or indirectly, any payment or present any
                                         valuable gifts to any government officials for the purpose of obtaining or retaining
                                         business.

 

		22.6	If any Party's economic benefits
                                         under this License Agreement or any material part thereof and as contemplated herein
                                         are adversely and materially affected by the promulgation of any new laws of the PRC
                                         or the amendment or interpretation of any existing laws of the PRC after the date of
                                         this License Agreement, or by the inability to obtain necessary or convenient approvals
                                         from the relevant authorit(ies), the Parties will promptly consult with each other and
                                         use their reasonable efforts to implement any adjustments necessary to maintain each
                                         Party's economic benefits derived from this License Agreement on a basis no less favourable
                                         than the economic benefits it would have derived if such laws, rules, or regulations
                                         had not been promulgated, amended, or so interpreted.

 

		22.7	An act of disclosure of Licensor’s
                                         Technical Confidential Information shall not be considered as an act of granting a license
                                         or right to such information (whether to the Licensee, its Affiliates) unless otherwise
                                         expressly agreed hereunder.

 

    	21

    	 

    

 

		23.	LANGUAGE

 

		23.1	This Agreement and the appendix is
                                         prepared in Chinese and English languages, with both languages equally effective. If
                                         any discrepancies occur between the two languages, the Chinese language shall prevail.

 

APPENDIX A: DEFINITIONS AND INTERPRETATION

 

APPENDIX B: DESIGN BASIS COAL

 

APPENDIX C: PROCESS DESIGN PACKAGE
(PDP) SERVICES AND SCOPE OF WORK

 

APPENDIX D: TECHNICAL SERVICES

 

APPENDIX E: PERFORMANCE TEST PLAN

 

APPENDIX F: ESTIMATED TECHNICAL SERVICE
MANHOURS AND COST

 

    	22

    	 

    

 

IN WITNESS WHEREOF, the Parties have caused
this License Agreement to be executed by their duly authorized representatives on the dates hereinafter indicated.

 

SIGNED by Licensor

[COMPANY NAME]

 

Legal Representative or Authorized Representative

 

(Printed name)

Date:

 

SIGNED by Licensee

{LICENSEE NAME]

 

Legal Representative or Authorized Representative

 

(Printed name)

Date:

 

    	23

    	 

    

 

APPENDIX A DEFINITIONS AND INTERPRETATION

 

DEFINITION

 

	"Acceptable Contractor"	means a contractor experienced in constructing gasification
    facilities, working under the direction of capable and experienced project management
	 	 
	"Affiliate"	means any person or entity that owns or Controls, is owned or
    Controlled by or is under common ownership or Control with a Party, However, Licensee shall not be deemed as an affiliate
    of other enterprises or entities only because such enterprises or entities are under common ownership or Control of the PRC
    or a provincial or city government.
	 	 
	"Agreed Technical Objective"	has the meaning given to it in Recital (3)
	 	 
	“Confidential Information”	shall mean technology and Know-How as well as trade secrets, strategic business or marketing
    information, business projections, secret processes and etc., including but not limited to processes, data, formulae, material
    balance, control logic, programs, manuals, designs, sketches, photographs, plans, drawings, specifications, reports, studies,
    findings, non-patented inventions and ideas, any data relating to a patent that is not disclosed in a granted patent, and
    other information relating to the production, packaging, use, pricing, or sales and distribution, whether of a technical,
    engineering, operational, business or economic nature, whenever provided by SESHK (or its Affiliates).

 

    	24

    	 

    

 

	"Control"	means in relation to a company the ability to exercise,
    or direct the exercise of, greater than half of the voting power at any meeting of the shareholders or board of directors
    of that company (and "Controls" and "Controlled" shall be construed accordingly)
	 	 
	"Default Rate"	means the prime lending rate published by the People’s
    Bank of China for the same period
	 	 
	“Design Basis [FEEDSTOCK]”	means [FEEDSTOCK]that is agreed between the Parties after discussions
    which shall form the Design Basis for the PDP for SGT and an indicative [FEEDSTOCK]  The minimum sample analysis
    required is included in Appendix B
	 	 
	"Designed Capacity"	means the production of [X,XXX,XXX] Nm3/day (dry basis)
    of Dry Net Syngas using the Design Basis [FEEDSTOCK] at the Licensed Facility.
	"Effective Date"	means the date when this License Agreement shall come into force
    as specified in Section 2
	 	 
	"Licensed Facility"	means the facility designed to produce [X,XXX,XXX] Nm3/day
    of Dry Net Syngas to be built by the Licensee at the designated location of the Project.
	 	 
	"GTI"	means the Gas Technology Institute, an Illinois non-profit corporation

 

    	25

    	 

    

 

	“Know-How”	shall mean all commercial and technical information,
    including trade secrets, pertaining to the SGT, and/or ZCM’s manufacturing of the SGT proprietary equipment, including,
    but not limited to, theses, designs, drawings, blueprints, specifications, test data, charts, fabrication techniques, materials
    of construction, and formulations, graphs, operating and test procedures, shop practices and instruction manuals.
	 	 
	"License Fee"	means the license fee set out in Section 4.1
	 	 
	“Dry Net Syngas"	means the gross volume of syngas exiting the SGT, including all
    constituents which include but not limited to as CO, H2, CH4, H2O, S-components, N-components,
    and other constituents and components when measured on a dry basis without H2O
	 	 
	“Net Syngas”	means the volume of CO + H2 + CH4 SES Gasification system, measured
    on a dry basis. The scope of SES Gasification System means the scope from dry coal delivery point to the coal feed hoppers
    to the wet scrubber outlet.
	 	 
	"PDP Design Basis"	means the document that sets forth mutually agreed battery limit
    design parameters for the SGT
	 	 
	“Performance Test”	means continuous seventy-two [72] hours test running of Licensed
    Facility upon completion of construction, see Appendix E.
	 	 
	“SASH”	means SES Asia Technologies, Ltd.

 

    	26

    	 

    

 

	“SES Gasification Technology” (SGT)	means proprietary technology information and proprietary
    technology secrets that Licensor has been licensed to use or sublicensed to use, or has obtained and owned intellectual property
    rights, such as patent, or such other not-patented Know-How that belongs to Licensor, including but not limited to, U-GAS®,
    [FEEDSTOCK] feeding, gasification, syngas cooling, ash/char removal, fly ash and fines recycling and removal, gasification
    based steam generation and the automation and control logic for the system.
	 	 
	Technical Services”	 

 

INTERPRETATION

 

		1.	Licensor and Licensee
                                         are referred to as a "Party" or collectively as the "Parties".

 

		2.	Section and Appendix headings do not
                                         affect the interpretation of this License Agreement. A reference to a Recital, Section
                                         or Appendix is to a Recital, Section or Appendix to this Agreement, unless otherwise
                                         indicated.

 

		3.	A reference to a law is a reference
                                         to it as it is in force for the time being, taking account of any amendment, re-enactment
                                         and includes any subordinate legislation for the time being in force made under it.

 

		4.	Writing or written includes faxes
                                         but not email.

 

		5.	Words in the singular include the
                                         plural and in the plural include the singular.

 

		6.	A reference to one gender includes
                                         a reference to the other gender.

 

		7.	Any phrase introduced by the terms
                                         “including”, “include”, "includes" or any similar expression
                                         shall be construed as illustrative and the words following any of those terms shall not
                                         limit the sense of the words preceding those terms.

 

    	27

    	 

    

 

APPENDIX B DESIGN BASIS COAL

 

Analysis of Design Base Coal

 

	Proximate

analysis	Dry
    basis	As
    received

    basis	Air
    dry basis	Dry
    ash-free

    basis
	Moisture	 	 	 	 
	ash	 	 	 	 
	Volatile	 	 	 	 
	Fixed
    carbon	 	 	 	 
	Ultimate
    analysis	 	 	 	 
	moisture	 	 	 	 
	ash	 	 	 	 
	carbon	 	 	 	 
	hydrogen	 	 	  	 
	nitrogen	 	 	 	 
	sulfur	 	 	 	 
	oxygen	 	 	 	 
	total	 	 	 	 
	HHV
    kcal/kg	 	 	 	 
	LHV
    kcal/kg	 	 	 	 

 

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APPENDIX C PROCESS DESIGN PACKAGE
(PDP) SERVICES AND SCOPE OF WORK

 

Unless otherwise provided, italicized
terms in this Appendix 3 follow the definitions applicable to the main body of the Technology License Agreement. References to
Sections shall be to Sections of this Appendix unless otherwise stated.

 

Part I

 

		1.	Within [10] days of Effective Date,
                                         Licensor shall prepare a project programme for the PDP Services ("Programme").
                                         Within [10] days of receipt of the Programme, Licensee shall respond in writing, either
                                         consenting to the Programme or suggesting alteration thereto. Once agreed, both Parties
                                         will take all reasonable commercial endeavours to adhere to the Programme.

 

		2.	Licensee will furnish complete data
                                         with respect to the Licensed Facility and SGT design basis in accordance with the Programme,
                                         including primary product requirements to be used for PDP engineering.

 

		3.	A detailed PDP Design Basis will be
                                         prepared and mutually agreed by Licensor and Licensee in accordance with Part II below
                                         prior to commencement of the Process Design Package engineering.

 

		4.	Licensor will prepare the PDP based
                                         on the PDP Scope of Work in Part III below. Licensor will furnish [5] copies of the PDP
                                         and an irrevocable copy of electronic disk to Licensee.

 

		5.	The Licensee shall, provide to the
                                         Licensor a list of Design Contractors which intend to participate in the bidding, and
                                         require all such Design Contractors participating in the bidding to sign a technology
                                         confidentiality agreement in accordance with the Licensor’s requirements. To protect
                                         intellectual property rights of the Licensor, the Licensee agrees that all the Design
                                         Contractors shall be reviewed by the Licensor, and the Licensor shall have the right
                                         (on reasonable grounds) to decide and remove form the list of tenderers the Design Contractors
                                         which are not suitable in the Licensor's opinion. The Licensee shall not issue the tender
                                         invitation documents to such disqualified Design Contractors, nor enter into such review,
                                         consultancy or service contract in respect of the PDP, Basic Design and Detailed Design
                                         of SGT system.

 

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		6.	All deliverables of the PDP shall
                                         be considered SES Technical Confidential Information and be subject to the terms of this
                                         Agreement.

 

		7.	PDP shall be completed in accordance
                                         with the scope of deliverables included in part III below by licensor within [XX] weeks
                                         after the License Agreement becomes effective and the PDP Design Base has been approved
                                         by the Parties.

 

PDP Price

 

		8.	The PDP Price is
                                         [RMBXXXXXXX ("PDP Price").

 

		9.	The PDP Price shall
                                         be paid in instalments by Licensee to Licensor in compliance with the Agreement Section
                                         [X].

 

		10.	Within three (3)
                                         weeks (and the design institute is in place) after completion and delivery of the PDP,
                                         the Licensee shall review the PDP. The Licensor shall modify, improve and deliver the
                                         PDP in conjunction of an irrevocable copy of electronic disk to the Licensee within 6
                                         weeks after the review. The Licensee shall issue a letter to Licensor, stating that the
                                         PDP is received and complete. If Licensor has not received this written notice within
                                         1 month of shipping the PDP then it shall be deemed that the PDP has been accepted by
                                         Licensee and that the PDP is complete.

 

Part II

 

PDP - Basis for Design

 

Licensee and Licensor will prepare a Basis
for Design in respect of the Design Basis Coal for the SGT System which shall include information of both Normal Operating Conditions
and the Design Conditions for licensee’s review: Metric Units will be used for the PDP.

 

    	30

    	 

    

 

		1.	Normal Operating Conditions (NOC)
                                         are defined as the conditions based on the Design Coal to which the PDP design will be
                                         optimized for performance. The PDP Heat and Material Balance will be optimized for NOC
                                         conditions. This is the operating case normally expected for the SGT System.

 

		2.	Design Conditions (DC) are defined
                                         as conditions that include the range of conditions with margins that the SES U-GAS System
                                         must be capable of meeting, namely:

 

		a.	Flow rates, temperatures, compositions,
                                         and pressure of coal feed and oxygen streams (including oxygen purity).

 

		b.	All specifications and requirements
                                         for the syngas and ash leaving the SGT

 

		c.	Any special considerations to
                                         be included in the design approach such as water discharge quality or consumption. Note
                                         that the SGT system does not include water and wastewater treatment, but the design can
                                         be optimized for specific project considerations.

 

		3.	Licensee and Licensor will prepare
                                         PDP Design Basis prior to initiation of the PDP which will include items listed but not
                                         limited to the following:

 

		i.	Composition and analysis of the
                                         Design Basis Coal

 

		ii.	Site conditions – Ambient,
                                         geological considerations, special zones such as earthquake, or flooding, wind loading,
                                         dust loading, other site factors.

 

		iii.	Product and By-Products Specifications

 

		iv.	Utilities
                                         – Cooling Water, Demineralized water, Steam,
                                         Power, etc

 

		v.	Specifications of utility materials
                                         and energy battery limit: list the specifications of water, steam, compressed air, nitrogen,
                                         electricity, etc. such as

 

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		vi.	Cooling water—temperature
                                         (inlet/outlet), pressure (inlet/outlet)

 

		vii.	Fresh water, soft water, de-oxygen
                                         water, demineralised water, steam—temperature and pressure

 

		viii.	Compressed air (instrument air,
                                         plant air)—temperature,
                                         pressure, dew point, oil content

 

		ix.	Nitrogen, oxygen—temperature, pressure,
purity

 

		x.	Fuel oil (fuel gas)—temperature,
pressure, heat value, composition

 

		xi.	Heat carrier—composition, heat value,
boiling point, thermodynamic properties.

 

		xii.	Cooling medium—temperature,
pressure

 

		xiii.	Power: power supply voltage,
                                         frequency, phase/wiring

 

Part III

 

Process Design Package – Scope

 

Once a completed Basis for Design has
been mutually agreed upon, the PDP Package will be prepared and will include the following deliverables:

 

		1)	Basis for Design

 

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		2)	Scope of design: The Basis for Design
                                         shall include definition of the PDP scope and battery limits.

 

		3)	Process Flow Diagrams (PFDs). The following
                                         information shall be included in the PFDs:

		a)	Process flow scheme including all
                                         major lines required for start-up, normal and abnormal condition and shutdown/turndown
                                         modes;

		b)	Item number, service name of all
                                         equipment;

		c)	Outline of equipment to indicate
                                         equipment type (Type of Heat Exchangers, Pumps, Compressors, etc.); and

		d)	Stream number for main process and
                                         utility streams; The stream number shall be referred to by Heat and Material Balance
                                         with stream properties.

 

		4)	NOC Heat and Material Balance corresponding
                                         to the stream number in the PFD for the Normal Operating Case including for numbered
                                         streams:

		a)	Stream number;

		b)	Stream name;

		c)	Stream composition;

		d)	Total mass flow and molar flow;

		e)	Normal operation pressure;

		f)	Normal operation
                                         temperature;

		g)	Density of fluid at operation condition;

		h)	Molecular weight;

		i)	Bulk density of solids; and

		j)	Moisture content in solids.

 

		5)	Utility Summary: Specifications of utilities
                                         at PDP battery limits. List NOC and start-up consumptions:

		a)	Water: Applications, temperature,
                                         pressure, flow rate of circulation cooling water, circulating hot water, fresh water,
                                         soft water, de-oxygen water, de-mineralized water, and boiler feed water

		b)	Steam: Applications, temperature,
                                         pressure, and flow rate

		c)	Nitrogen: Applications, temperature,
                                         pressure, and consumption

		d)	Compressed air (instrument air and
                                         plant air): Applications, temperature, pressure, and consumption

		e)	Oxygen: Applications, temperature,
                                         pressure, and consumption

		f)	Carbon dioxide: Application, temperature,
                                         pressure, and consumption

		g)	Fuel gas: Specifications, applications,
                                         and consumption of fuel gas as necessary

		h)	Coke: Application, consumption

 

    	33

    	 

    

 

		i)	Refrigeration: Applications, parameters,
                                         and consumption

		j)	Power: Applications, power supply
                                         voltage, and shaft power calculation

 

		6)	Effluent and Emission Summary. Description
                                         of estimated waste emissions. Include source, temperature, pressure, discharge quantity,
                                         and content of major effluents and emissions, discharging frequency.

 

		7)	Catalyst and Chemical Summary. Includes
                                         name and consumption of catalysts and chemicals, including additives.

 

		8)	Suggested equipment layout plan and
                                         its description: describe relative relations and suggested relative dimensions of key
                                         equipment, and special requirements and compulsory rules.

 

		9)	Preliminary Piping and Instrument Diagrams
                                         (P&IDs). Indicate process equipment and location number, name in P&ID, material
                                         selection, and design conditions; nominal diameter for piping 100 mm and above diameter,
                                         material selection and special requirements for main pipes (including main process pipes,
                                         start-up and shutdown pipes, safety venting system pipes, utility material pipes) and
                                         valves; safety venting valves; main control and interlock loops. These preliminary P&IF’s
                                         are for use by the detailed engineering company to develop final P&ID’s. Licensor
                                         performs no piping layout, hydraulic calculations, or piping stress analyses.

 

		10)	Sized Equipment List. Classify P&ID
                                         equipment according to categories (such as vessel, heat exchanger, reactor, pumps and
                                         mechanicals, etc.). Include location number, name, quantity (in operation or on standby),
                                         operation temperature and pressure, technical specifications, material of construction,
                                         and estimated power rating.

 

		11)	Process Description

 

		12)	Process & Operating Guidelines. These
                                         are a description of how the process is operated, key safety and operating considerations,
                                         and necessary sequencing in startup and shutdown. These are not detailed operating procedures.

 

		a)	Describe main processes control requirements,
                                         including control principles and sequences for start-up, shutdown, and emergency shutdown.

		b)	Principles of incidents handling:
                                         Salient points of measures and steps adopted to deal with possible emergency incidents.

		c)	General refractory curing requirements

		d)	Equipment check and maintenance requirements
                                         for licensor supplied equipment.

 

    	34

    	 

    

 

		13)	Analytical requirements: Includes table
                                         of items to be analyzed, analysis frequency (start-up/normal operation), analytical methods,
                                         and recommended laboratory equipment list.

 

		14)	Process Data Sheets

		a)	Provide Process Data Sheets which
                                         includes the specification of certain major equipment not provided by the licensor.

		b)	List of special valves with main
                                         parameters and recommended suppliers.

 

		15)	Material Selection Guide for metallurgical
                                         recommendations for key equipment, piping, and valves.

 

		16)	Instrumentation and Controls

		a)	Instrument Data Sheets: Preliminary
                                         data sheets and specifications of special instruments with unusual or uncommon requirements
                                         or specifications.

		b)	Functional requirements for Cause
                                         and Effect/Interlock Logic/ESD Logic Diagrams.

		c)	Alarm and Trip List, including location
                                         and purpose.

 

		17)	Relief load assessment for the gasifier.
                                         Safe venting locations requirements and design scenarios for sizing relief valves.

 

		18)	Preliminary List of Standards: List of
                                         standards required for design.

 

		19)	Key Health, Safety and Environmental
                                         requirements

 

		20)	Outline drawings and estimated weights
                                         and preliminary layout for all Licensor supplied equipment

 

Part
three: PDP Changes

 

The scope of work and contents of PDP
shall not be amended in principle. In case that either Party requests for any change, the Parties shall negotiate for the settlement
of the same on fair and reasonable basis. The work scope and content of the PDP to be provided by the Licensor shall follow international
practices to satisfy the design institute’s requirements to complete the base design and detailed design.

 

    	35

    	 

    

 

APPENDIX D TECHNICAL SERVICE

 

		1.	The Licensor undertakes that it
                                         will provide the technical services regarding SGT to the Licensee in accordance with
                                         the Agreement and its Appendices upon the written request of the Licensee during the
                                         periods set out below:

 

		(1)	Basic Technical Services will
                                         be provided for the fee agreed upon in the License agreement and will consist of:

 

		a)	Detailed engineering PDP compliance
                                         review. Licensor will provide 80 hours of qualified expert time to review detailed engineering
                                         P&ID’s, specifications, and drawings. Licensee is to provide 60 days prior
                                         notice of need to review and provide the complete materials for review. Licensor will
                                         complete review within three calendar weeks.

 

		b)	Large bore piping Inspection. Licensor
                                         will provide two qualified experts for five days to review installation of major equipment
                                         and large bore piping ( greater than 200 mm diameter) for compliance with SGT and PDP
                                         requirements. Licensee should provide a minimum of 30 days notice for this inspection
                                         and it should be scheduled after all major equipment and large bore piping has been installed,
                                         but prior to mechanical completion.

 

		c)	Startup assistance. Licensor will
                                         provide one process and two Operations and maintenance SGT qualified experts for a period
                                         of two weeks to assist with startup. Licensee is to provide at least 30 days prior notice
                                         and commissioning must be complete. Any extension of time or more than one trip to the
                                         site will constitute additional technical services.

 

		d)	Performance Guarantee Test. Licensor
                                         will provide two SGT qualified experts for two days to advise licensee on their readiness
                                         to conduct the PGT, and for five days to conduct the PGT. Any additional mobilizations
                                         or time requirements will be Additional Technical Services. If Licensee declines to engage
                                         Additional technical Services to complete the PGT, the test is deemed passed. Licensee
                                         will provide at least 30 days advance notice for the readiness assessment and the PGT

 

		(2)	Additional Technical Services
                                         consist of any services requested requiring resources and time beyond those defined in
                                         Basic Technical Services. Additional Technical Services will be provided under terms
                                         and rates to be determined by agreement between Licensor and Licensee. Licensor strongly
                                         advises Licensee to secure additional technical services for operator training.

 

		1.1	The Licensor will select consultants
                                         with strong technical capabilities to provide technical service to the Licensee according
                                         to the contents and requirements of technical services as required. If the Licensee refuses
                                         to accept any Consultant so assigned and requests a replacement, the Licensor shall make
                                         reasonable efforts to replace such Consultant as soon as possible.

 

		1.2	The Licensee shall provide the Licensor
                                         and its Consultants with the necessary tools and safe working environment, and shall
                                         actively assist and support the Licensor and its Consultants in its work and complete
                                         in a timely manner the necessary internal approval or examination and approval procedures,
                                         so as to facilitate the carrying out of the technical services. The Licensor acknowledges
                                         that it will provide efficient and high quality technical services.

 

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APPENDIX E PERFORMANCE GUARANTEE TEST
PLAN

 

The Licensor will cooperate with the Licensee
(in conjunction with the Design Contractors, the comissioning and production units) in the preparation of Performance Test Plan.

 

Performance Test refers to an overall
examination of equipment on such design parameters as production capacity, processes indicators, environmental indices, product
quality, equipment performance, automatic control level, rated consumption, etc. subsequent to commissioning and successful production
of qualified products to see whether they conform to the corresponding design values.

 

		1	Principle of performance test

 

		1.1	Measure the performance of the SGT
                                         system relative to the key performance indices ( specific coal and oxygen consumption
                                         and net syngas production rate).

 

		2	Duration and conditions of
                                         performance test

 

2.1 Duration of performance test

 

Operation of single gasifier:
Operate 72 hours at 100% load.

 

Parallel operation of multiple
gasifiers: Multi-gasifiers operate 72 hours in parallel except the spare gasifier.

 

The application for performance
test shall be completed within 12 months after mechanical completion.

 

2.2 Conditions of performance
test

 

Performance test shall be conducted
after the equipment has been operated stably at full load or high load for a continuous period of time and the following conditions
are met:

 

The commissioning summary has
been completed;

 

Problems
affecting performance test have been resolved;

 

All equipment has operated
reliably and is in good conditions;

 

DCS, automatic control instrumentation,
online analyzing meters and interlocks have all been put into normal operation;

 

Sampling
locations and frequency as well as methods have been used in normal operation and are functioning properly;

 

    	37

    	 

    

 

The quality of feedstock, fuels,
chemicals, lubricating oil (grease), spare parts are consistent with design requirements, and the storage is able to meet the
requirements of performance test;

 

Utilities
are in stable operation, and can meet requirements for performance test;

 

Inter-connection between upstream
and downstream equipment has been effected, and syngas demand is stable and sufficient to allow 100% syngas capacity operation.

 

		3	Indicators for performance
                                         test

 

The following indicators
shall be achieved when the system operates at 100% load:

 

Net Syngas production from
a single gasifier;xxxxxxxxNM3/h

 

carbon in spent char;≯x;

 

carbon conversion;greater
than xx;(based on finalized design coal, design value: 9

 

coal consumption for 1000NM3
Net Syngas;≯xxxx/ton

 

oxygen consumption for 1000NM3
Net Syngas;≯xxxxx/NM3

 

MP steam production from 1000NM3
Net Syngas;≮[ ] ton (to be decided after completion of PDP)

 

(CO+H2) content in Gross Syngas
(dry base);≮xx;

 

CH4 content in Gross Syngas;≯x;

 

accumulative operation rate;100;
(within 72 hours)

 

Rate of qualified Gross Syngas
(dry base);100; (within 72 hours)

 

		4	Organizations of performance
                                         test
	 	 	 

		4.1	A performance test working group
                                         shall be established consisting of the relevant departments of joint venture, the Licensor,
                                         the design unit(s), contractor(s), etc., which shall be fully responsible for arrangement
                                         of the performance test.
	 	 	 

		4.2	The performance test for each piece
                                         of equipment can be carried out separately or simultaneously.

 

    	38

    	 

    

 

		5	Performance test report
	 	 	 

		5.1	Upon completion of the performance
                                         test, raw data shall be collated for each piece of equipment in a timely manner. The
                                         data for verification and calculation program as well as methods shall be jointly confirmed
                                         by the Licensee, the Licensor, the design institute(s) and contractor(s).
	 	 	 

		5.2	The various raw records shall be
                                         provided to the design entities for verification and calculation, and the relevant data
                                         shall be provided to the Licensor or the contractor for necessary calculation. Evaluation
                                         on test conclusions shall be conducted. An appraisal report shall be prepared and submitted
                                         within 15 days after completion of the performance test, which shall include a table
                                         of comparison between calculation results and guaranteed values.
	 	 	 

		5.3	If the value measured during performance
                                         test and/or the value calculated by an accepted computer program are/is equal to or better
                                         than the guaranteed value, it shall be deemed that the equipment has met the requirements
                                         of guaranteed performance.
	 	 	 

		5.4	The appraisal report shall be signed
                                         by all parties involved in the performance test. The joint venture company will notify
                                         in writing each patent licensor and contractor whether or not the equipment has met the
                                         requirements of acceptance, and will issue a pre-acceptance certificate with express
                                         conditions for equipment which is ready for acceptance (to distinguish it from the final
                                         acceptance certificate issued upon expiration of warranty period).

 

		6	Outstanding issues from performance
                                         test

 

If results of performance test
fail to meet design requirements and guaranteed value under the contract which is caused due to the reasons attributable to the
Licensor, the settlement and the time period for settlement shall be set out in accordance with the relevant terms of the contract.

 

		7	Compilation and approval of
                                         performance test plan 
	 	 	 

		7.1	Performance test plan includes:
	 	 	 

		l	General
                                         principles for performance test;
	 	 	 

		l	Organizations
                                         of performance test;
	 	 	 

		l	personnel,
                                         materials, data as well as preparation and compilation of the relevant rules and regulations;
	 	 	 

		l	operation
                                         procedures of performance test;
	 	 	 

		l	balance
                                         of materials, feedstock, water, electricity, gas, steam, fuel and storage and transportation
                                         of the same;
	 	 	 

		l	Performance
                                         test plan and overall planning and control diagram;
	 	 	 

		l	Supply
                                         plan for the relevant facilities and materials.
	 	 	 

		7.2	The performance test implementation
                                         plan (based on each piece of equipment within PDP scope) shall be jointly compiled by
                                         the Licensee and Licensor.

 

    	39

    	 

    

 

Annex
6

EQUIPMENT
SALES FRAMEWORKAGREEMENT

 

This Equipment Sales Framework Agreement
(this “ESA”) is entered into on February 14, 2014, in relation to the Joint Venture Contract (the “Contract”)
between Zhangjiagang Chemical Machinery Co., Ltd. and SES Asia Technologies, Ltd. Dated February14, 2014, by and between:

 

Zhangjiagang Chemical Machinery Co.,
Ltd., a company limited by shares established and existing under the laws of the PRC whose registered address is No. 20 Chengyang
Road, Houcheng, Jingang Town, Zhangjiagang City, Jiangsu Province, 215631, PRC (“ZCM”).

 

and/

 

ZCM SES Sino-US Clean Energy Technologies
Co., Ltd., a limited liability company established and existing under the laws of the PRC in accordance with the Contract,
whose registered address is (the “Company”).

 

ZCM and the Company may hereinafter be
referred to individually as a “Party” or collectively as the “Parties”.

 

WHEREAS, the Company is granted
with the exclusive usage and operation right of the SGT and the right to manufacture and sell SGT Proprietary Equipment within
the Territory pursuant to the Technology Usage and Contribution Agreement (“TUCA”);

 

WHEREAS, the SGT Proprietary Equipment
involved in the Company’s business should be manufactured by qualified, professional manufacturer(s);

 

WHEREAS, the Company intends to
engage ZCM as the manufacturer for the SGT Proprietary Equipment and ZCM is willing to manufacture for and provide to the Company
such equipment.

 

THEREFORE, in consideration of
the above facts and confirming that the Parties are completely informed, intend to be legally bound, and in conformity with the
principles of equality and mutual benefit, the Parties hereby agree as follows

 

		1.	DEFINITIONS

 

The following words and phrases will have
the meanings set forth below where used herein with initial capital letters. Capitalized terms used but not defined herein shall
have the meanings given to them in the Contract and the TUCA.

 

    	1

    	 

    

 

		1.1	“Annex” means
                                         any addition to this ESA which is labeled as such and which shall be an integral part
                                         of this ESA.

 

		1.2	“Average Gross Margin”
                                         means ***.

 

		1.3	“Equipment” means
                                         SGT Proprietary Equipment and other equipment for SGT Projects.

 

		1.4	“Equipment Exhibit”
                                         means an exhibit to this ESA defining the terms and conditions of a specific transaction
                                         hereunder including but not limited to the technical specifications and requirements
                                         for the Equipment, the delivery and warranty terms of the transaction, the economic arrangement
                                         for the transaction, etc., to the extent they are undefined in this ESA.

 

		1.5	“Equipment Sales Price”
                                         means the price charged by ZCM to the Company for the sale of the Equipment under a transaction
                                         contemplated hereunder.

 

		1.6	“Equipment Final Price”
                                         means the price charged by the Company tothe end customer under a Project for the sale
                                         of the Equipment purchased from ZCM.

 

		1.7	“Equipment Final
                                         Gross Sales Margin” means ***

 

		1.8	“Production Cost”
                                         means the raw material costs, labor costs and manufacturing costs directly related to
                                         the sale of Equipment.

 

		1.9	“Purchase Order”
                                         means the individual purchase order issued by the Company to ZCM for the purchase of
                                         the Equipment for a transaction hereunder.

 

		1.10	“Warranty Period”
                                         means the period for which the Company is entitled to claim replacement of spare parts
                                         for and/or correction of any other defects with the Equipment by ZCM free of charge.

 

*** This information has been omitted
in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

    	2

    	 

    

 

		2.	EXCLUSIVITY

 

		2.1.	The Company herein grants the exclusive
                                         right to ZCM to manufacture and provide to the Company the Equipment within the Territory,
                                         based on its exclusive usage and operation right tothe SGT as provided under the Contract
                                         and the TUCA.

 

		2.2.	The exclusive right granted by the
                                         Company to ZCM under this ESA shall be subject further to the terms and conditions set
                                         out in the Contract and the TUCA and be conditional upon any adjustment to or termination
                                         of the Company’s exclusive right to the SGT and the Equipment pursuant to the Contract
                                         and the TUCA.

 

		2.3.	After the Establishment Date and within
                                         the Joint Venture Term, or until the termination of the TUCA, whichever comes first;ZCM
                                         shall be the exclusive legal entity within the Territory to manufacture and provide to
                                         the Company the Equipment based on the terms and conditions as defined herein, unless
                                         otherwise agreed by both Parties.

 

    	3

    	 

    

 

		3.	SALE OF EQUIPMENT

 

		3.1	For the Equipment manufactured and
                                         sold hereunder, the Parties shall define and agree on the particular terms and specific
                                         requirements (including but not limited to the type and model of the Equipment, the technical
                                         and performance specifications, the terms for delivery, anything unusual or undefined
                                         herein or different from what is provided herein, etc.) for the Equipment at issue with
                                         a separate written Equipment Exhibit.

 

		3.2	Once signed by both Parties, the aforesaid
                                         Equipment Exhibit shall be incorporated herein and deemed as a part of the ESA binding
                                         on the Parties for the manufacture and purchase and sale of the Equipment at issue under
                                         the particular transaction. Each of such Equipment Exhibits shall be kept and attached
                                         to the ESA for recording.

 

		3.3	ZCM will manufacture, sell and deliver
                                         the Equipment to the Company in compliance with the Equipment Exhibit defined in above
                                         Articles 3.1 and 3.2.

 

		3.4	Purchase and delivery of the Equipment
                                         shall be made pursuant to the orders from the Company to ZCM. A Purchase Order shall
                                         be promptly acknowledged by ZCM with a price quotation after receiving it. Any acceptance
                                         (with the Equipment Sales Price quotation in the form provided in Article 5), refusal
                                         of, or change to a Purchase Order shall all be made in writing, fax or email by ZCM and
                                         communicated to the Company within [Ten (10)] working days from the date of receiving
                                         such Purchase Order by ZCM. If no response is made by ZCM to the Company within Ten (10)
                                         working days after the Company sends out a Purchase Order, such Purchase Order shall
                                         be deemed as accepted by ZCM.

 

		4.	DELIVERY
                                         & ACCEPTANCE

 

		4.1	Delivery

 

Delivery shall be considered
performed when the Equipment as ordered has been handed over to the other address as agreed by the Parties.

 

    	4

    	 

    

 

The delivery due dates or delivery
deadlines given in the Purchase Order shall take into account the delivery lead times agreed with ZCM. The agreed delivery due
dates or delivery deadlines shall be binding. Should a change in the agreed delivery due dates or delivery deadlines become necessary
or if circumstances arise which indicate that the agreed delivery time cannot be complied with, ZCM shall inform the Company without
delay. The Parties shall then settle the matter of delivery time through negotiation.

 

Partial delivery is only allowed
with the prior written consent of the Company.

 

		4.2	Acceptance

 

The Company shall conduct inspection
of the Equipment within a reasonable period of time after taking delivery and is entitled to reject acceptance of the Equipment
if defects are discovered. However, with regard to minor defects that do not substantially affect the safety, operation, maintenance
or repair of the Equipment, the Company may choose not to reject acceptance but require immediate correction of such defects by
ZCM who shall not refuse such request by the Company without reasonable grounds.

 

		5.	PRICE AND PAYMENT

 

		5.1	ZCM, after receiving a Purchase Order
                                         from the Company, shall respond to the Purchase Order with an Equipment Sales Price quotation
                                         in writing communicated to the Company within Ten (10) working days.

 

		5.2	The Equipment Sales Price quoted from
                                         ZCM shall be made according to the following principles and methods:

		(a)	The price shall be composed of ***.

 

		(b)	Based on the principles in above
                                         paragraph (a), both Parties agree on the pricing formula below:

The Equipment Sales Price is
no less than ***. The initial ratio = ***

 

*** This information has been omitted
in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

    	5

    	 

    

 

		(1)	Ratio
                                         * The ratio
                                         needs to be discussed annually and reach agreement before 30 June each year;

 

		(2)	The
                                         ratio need to be agreed by two representatives from each shareholders of the Company.

 

		(c)	In order to improve and fully optimize
                                         the market competitiveness of the Company to reduce the costs of the Projects, the Parties
                                         shall, in consideration of the actual market situation of each Project, use their best
                                         commercial efforts to enable the Company to win more SGT sales orders, by effectively
                                         reducing costs through improving labor productivity (e.g. optimizing design, optimizing
                                         procurement, increasing automation) and other practical methods.

 

		5.3	The Company shall decide with the relevant
                                         customer the Final Price for the sale of Equipment and the Final Equipment Gross Sales
                                         Margin of the Company shall in principle equal to the Average Gross Margin.

 

		5.4	Although the Company will endeavor
                                         to maximize the margin of the sales of the Equipment, situations may actually exist where
                                         the Gross Sales Margin with the Final Price is lower than the Average Gross Margin. In
                                         such situations, In such situations, the following measure(s) shall be taken if unanimously
                                         approved by the Board of the Company:

 

		(a)	The Company may compare the Equipment
                                         Sales Price quotation based on a competitive price comparison, and ZCM shall accept the
                                         quotations from other supplier(s) of similar size and recognized by ZCM;

 

		(b)	Where the Project(s) at issue is
                                         of critical significance to the Company’s business and/or development (e.g. breakthrough
                                         Projects at the beginning of the Company’s business, strategic demonstration Projects,
                                         etc.), the Company shall be allowed by the Board to sell the relevant Equipment at the
                                         Final Price even though the Gross Sales Margin cannot reach the Average Gross Margin;
                                         or

 

		(c)	Other solutions.

 

    	6

    	 

    

 

		5.5	The mechanical design costs will be
                                         quoted separately according to the actual costs.

 

		5.6	Unless specified otherwise in the Equipment
                                         Exhibit as provided under Article 3, the currency for Equipment Sales Prices shall be
                                         RMB.

 

5.7       If, after the execution
of this Agreement, it is determined that the Equipment Sales Price mechanisms outlined in this Agreement is not workable for any
reason (a “Change in Circumstances), then the Parties shall amend this Agreement so that the amended agreement puts the
Company in the same economic position the Company would have been in had there been no Change in Circumstances.

 

		6.	PACKAGING 

 

ZCM shall pack the Equipment
in accordance with the applicable industrial standards based on the specific size, type, model and other particularities of the
Equipment, or in compliance with the Company’s specific packaging instructions as set out in the Equipment Exhibit in Article
3

 

		7.	APPROVAL

 

		7.1	The Equipment shall fulfill the relevant
                                         and applicable safety standards as well as other relevant and applicable regulations/standards.
                                         The necessary authentication shall be properly attached to the Equipment and any packaging
                                         according to the relevant regulations for marks of the PRC. If some of the Equipmentrequires
                                         any additional obligatory regulatory approvals, the relevant Equipmentand packing shall
                                         also fulfil such additional regulations and shall bear such additional marks.

 

		7.2	The Company shall provide timely assistance
                                         for ZCM in applying for all mandatory approvals/certifications for the relevant Equipment
                                         or the manufacture of the relevant Equipment within the Territory. ZCM shall bear the
                                         charge for applying for and obtaining such approvals.

 

    	7

    	 

    

 

		8.	WARRANTY

 

		8.1	ZCM warrants that the Equipment (i)
                                         meets the technical specifications, (ii) corresponds with the technical requirement provided
                                         by the Company for the Project under the relevant PSA, and (iii) complies with all statutory
                                         requirements and regulations applicable to the manufacture, sale and use of the Equipment,
                                         including all obligatory applicable safety regulations, packaging, labeling and other
                                         standards in the PRC.

 

		8.2	Unless specified otherwise in the
                                         Equipment Exhibit as provided in Article 3, the Warranty Period for the all Equipment
                                         shall be *** months from the purchase day of the end user, or *** months from the date
                                         of delivery to the Company, whichever is earlier. In case any quality or design defect
                                         causes damage to the Equipment within the Warranty Period, ZCM shall make free repairs,
                                         provide delivery of free spare parts or replacements within a reasonable time after receiving
                                         notice by the Company and after checking and confirming the warranty claim by ZCM. The
                                         Warranty Period for any replaced spare parts which is replaced during the Warranty Period
                                         of the Equipment is *** months from the date of replacement.

 

		8.3	The Warranty Period must be proven
                                         by the end user by means of warranty card and/or an official purchase invoice issued
                                         to the end user by the Company. The date of purchase by the end user must be reported
                                         by the Company to ZCM when a warranty claim is presented.

 

*** This information has been omitted
in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

    	8

    	 

    

 

		8.4	ZCM shall reimburse the Company’s
                                         reasonable out-of-pocket costs and expenses incurred in connection with any recall or
                                         replacement program caused by the Equipment itself and confirmed by both Parties (such
                                         costs and expenses shall include, the cost of repair, repurchasing or replacing the recalled
                                         Equipment, any costs of packing and transportation of the recalled Equipment, and other
                                         expenses agreed by both Parties). The amount to be reimbursed by ZCM to the Company will
                                         be discussed and agreed upon between the Parties after a recall action or replacement
                                         program has taken place. Both Parties agree to take appropriate measures pursuant to
                                         the request of client as practically feasible. The Company shall furnish to ZCM all records
                                         regarding quality guarantee and certification of costs and expenses (including a detailed
                                         costs breakdown) incurred at the reasonable request by ZCM.

 

It is understood
and agreed that the Parties will notify each other in a timely manner of any condition known to them that may affect the safety
of such Equipment. In addition to such reimbursement of costs, the Company reserves the right to pursue other remedies against
ZCM in connection with quality guarantee.

 

		9.	PRODUCT QUALITY

 

		9.1	ZCM shall design (if applicable),
                                         manufacture, inspect and accept the Equipment in conformity with the applicable industrial
                                         standards and the SGT quality standards and SESHK/ZCM quality standards provided under
                                         this ESA, the respective Equipment Exhibit, the Contract and the TUCA.

 

		9.2	During the quality guarantee period,
                                         the Company may also take all actions necessary to remedy the defect on its own or with
                                         the retaining of third parties in case ZCM does not fulfil its warranties or other obligations
                                         hereunder within a reasonable period of time as agreed by the Parties. In urgent cases,
                                         and whenever possible after consulting ZCM, the Company is entitled to remedy any defect
                                         on its own or by retaining third parties to do so. Minor defects may, in the interest
                                         of an uninterrupted production, be remedied by the Company without prior consultation
                                         with ZCM, and the Company need to inform ZCM the situation as earliest; for example,
                                         if unusually high damages would occur while awaiting such consultation with ZCM, the
                                         Company may flexibly take emergency measures to fix it, but need a early notice to ZCM.
                                         Any costs resulting thereof including ancillary costs incurred by the Company will be
                                         borne by ZCM

 

    	9

    	 

    

 

		10.	INDEMNITY/INSURANCE

 

		10.1	ZCM agrees to defend, indemnify
                                         and hold the Company harmless against liability, loss, expense, damage or cost arising
                                         out of personal or bodily injury or death or property damage that is alleged to have
                                         been caused by any defect in the Equipment manufacturing.

 

		10.2	The Company shall inform ZCM of
                                         any defect in the equipment as soon as possible, so that ZCM shall send the responsible
                                         people to be on site for handling such or authorize the Company to handle the accident
                                         case on site.

 

		10.3	ZCM shall procure and maintain such
                                         insurance relating to the Equipment according to the mutual agreement, and the applicable
                                         requirements of related regulations, and the related expenses will be borne by the Company

 

		11.	EQUIPMENT TECHNICAL SUPPORT

  

		11.1	The Company shall provide the necessary
                                         technical support and assistance to ZCM during the manufacturing process of the ordered
                                         Equipment as agreed by the Parties.

 

		11.2	ZCM shall provide to the Company
                                         materials and information related to the equipment pursuant to the mutual agreement and
                                         the requirements of related standards at delivery.

 

		11.3	Such materials and information shall
                                         be provided by ZCM to the relevant end user (or any company) pursuant to the mutual agreement.

 

		11.4	ZCM shall provide related services
                                         in a timely manner pursuant to the mutual agreement, and the relevant expenses shall
                                         be borne by relevant party(ies) according to the mutual agreement.

 

    	10

    	 

    

 

		12.	FORCE MAJEURE

 

Both Parties will use their
best efforts to adhere to all stipulations of this ESA but shall not be held responsible for any delay or failure in the performance
of this ESA arising from any of the following matters: Acts of God, fire, flood, drought, strikes, acts of war or any other causes
beyond the reasonable control of the Party concerned; and the time for performance by such Partyshall be extended by the period
of any such delay; provided, however, that if any such delay shall continue for a period of over [sixty(60)] days, the Party not
being subject to the force majeure shall have the right to immediately cancel orders placed and terminate this ESA specifically
in respect of the relevant Equipment affected by the force majeure upon written notice to the other Party.

 

		13.	TERM AND TERMINATION

			

 

		13.1	The term of this ESA shall be the
                                         same with the Joint Venture Term as defined under the Contract.

 

		13.2	Notwithstanding and in addition
                                         to the provisions of above Articles 13.1, this ESA may be immediately terminated by one
                                         Party upon written notice (specifying the reason for termination and the effective date
                                         of such termination) to the other Party upon or after the occurrence of any of the following
                                         events:

 

		(a)	a fundamental breach by the other
                                         Party of any of the principal terms or conditions of this ESA which is not corrected
                                         within sixty (60) days after receipt of written notification thereof. A fundamental breach
                                         hereunder will include but is not limited to:

 

(i) the repeated occurrence
of defects; or

 

(ii) the
repeated default in adhering to delivery schedules; or

 

(iii)
the repeated delay in making payment under this ESA.

 

		13.3	The termination of this ESA shall
                                         not affect any obligation under Article 8 to Article 10 and Article 15 which is intended
                                         hereby to survive the termination of this ESA.

 

    	11

    	 

    

 

		14.	ENTIRE AGREEMENT

 

		14.1	This ESA together with the Annex
                                         and Equipment Exhibits hereto constitutes the entire agreement between the Parties.

 

		15.	CONFIDENTIALITY

 

		15.1	The terms and provisions regarding
                                         confidentiality obligations under the Contract and the TUCA shall apply here to the relevant
                                         Party.

 

		16.	DISPUTE RESOLUTION

 

		16.1	Any dispute under or relating to
                                         this ESA which cannot be settled by the agreement of the Parties shall be settled with
                                         reference to Article 27 of the Contract.

 

		16.2	During the period when a dispute
                                         is being resolved, the Parties shall in all other respects continue their performance
                                         of this ESA, unless otherwise agreed.

 

		16.3	This ESA shall be governed by and
                                         construed in accordance with the laws of the PRC.

 

    	12

    	 

    

 

		17.	MISCELLANEOUS

 

		17.1	Language

 

This ESA
is following the requirement of Contact Item 28.

 

		17.2	Modification

 

Any modification
to this ESA and the Equipment Exhibits and Annex hereto is only valid if made writing and upon an agreement reached by both Parties.

 

		17.3	Notices

 

Any notice
or other communication required to be given under this ESA shall be in writing and to the addresses written at the beginning of
this ESA.

 

[signature pages follow]

 

    	13

    	 

    

 

IN WITNESS WEHREOF, the Parties hereto
have caused this ESA to be executed as of the date first above written by their duly authorized representatives.

 

	By:	 
	 	 
	Zhangjiagang Chemical Machinery Co., Ltd.	 

 

Name:

Position:

By:

 

	 	 
	ZCM SES Sino-US Clean Energy Technology Co., Ltd.	 

 

Name:

Position:

 

    	14

    	 

    

 

Annex 6

Technology Usage and Contribution Agreement

 

See Exhibit 10.2 to the Company’s
Current Report on 8-K filed on February 14, 2014 

 

    	1

    	 

    

 

Annex 7

Representation Letter from SESHK and
its Affiliates 

 

SES and SEST authorize SESHK to contribute
the following as its contribution to the Company:

 

		1.	The SGT which includes the U-GAS®
                                         technology is licensed from GTI and pressured fluidized bed gasification technology that
                                         use SGT Feedstock which has been developed from time to time thereafter (owned by SEST)
                                         to be contributed by SESHK;

		2.	SGT exclusive authorization of right
                                         granted by SESHK to the Company within the Territory;

		3.	Technology for manufacturing SGT Proprietary
                                         Equipment (drawings and related documents and materials);

		4.	Authorization rights for the Company
                                         to use the SGT related Patent license, computer program, model, database, specifications,
                                         data sheet, drawings for manufacturing proprietary equipment, standard for material selection,
                                         critical design parameters, in paper and/or electronic form.

		5.	The relevant operating guarantee for
                                         projects similar to ZZ Plant and Yima Plant as described in the TUCA

 

As intangible and tangible assets, according
to the Contract, it has a value equal to RMB53,800,000 (deemed value) as determined under the appraisal report issued by Beijing
Guan Fu Li Dao Appraisal Firm , an assets appraisal company mutually agreed by the Parties. The aforesaid shall be contributed
by SESHK as its capital contribution to the Company, representing thirty-five (35%) percent of the total registered capital of
the Company.

 

In addition to the provisions of the Contract,
SESHK further represents that:

 

		1.	The SGT is an advanced gasification technology
                                         that uses SGT Feedstock. On condition that a Project’s SGT Feedstock complies with
                                         the requirements of the SGT Feedstock for a project, the following parameters shall be
                                         satisfied:

 

		1.1	For ***(a) pressure, ZZ Plant, 400
                                         tons coal (based on design coal) daily, the following indicators shall be achieved when
                                         the system operates at 100% load:

		1.1.1	Net syngas production from
                                         a single gasifier: ***NM3/h

		1.1.2	carbon in spent char ***

		1.1.3	coal consumption
                                         for 1000NM3 net syngas *** ton adb

		1.1.4	oxygen consumption
                                         for 1000NM3 net syngas *** NM3

		1.1.5	(CO+H2)
                                         content in gross syngas (dry base) ***

		1.1.6	CH4 content
                                         in gross syngas ***

		1.1.7	accumulative
                                         operation rate *** (within *** hours)

		1.1.8	Rate of
                                         qualified gross syngas (dry base): *** (within *** hours)

 

		1.2	For***(a) pressure, Yima Plant,
                                         1200 tons coal (based on design coal) daily, the following indicators shall be achieved
                                         when the system operates at 100% load:

		1.2.1	Net
                                         syngas production from a single gasifier: ***NM3/h

		1.2.2	carbon
                                         in spent char : ***

 

*** This information has been omitted
in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

    	1

    	 

    

 

		1.2.3	carbon conversion : ***
                                         (based on finalized design coal, design value: ***; guaranteed value: ***)

		1.2.4	coal consumption for 1000NM3
                                         net syngas :*** ton adb

		1.2.5	oxygen consumption for 1000NM3
                                         net syngas : *** NM3

		1.2.6	(CO+H2) content in gross syngas
                                         (dry base) : ***

		1.2.7	CH4 content in gross syngas : ***

		1.2.8	accumulative operation rate : ***                                          (within ***
                                                                    hours)

		1.2.9	Rate of qualified gross syngas
                                         (dry base) : *** (within *** hours)

 

		2.	The SGT has strong technical advantages
                                         and potentials, and in the current condition of the SGT, may show better performance
                                         if the SGT Feedstock for a project is more suitable than that of the SGT Feedstock used
                                         for past projects, the performance parameters may be better than what is stated above;

 

		3.	SESHK has confidence in the Company’s
                                         capability to develop a gasification technology with higher pressure, and higher daily
                                         coal handling capability; and the already completed PDP for a ***MP(a) gasifier shall
                                         be included in the investment.

 

		4.	As the SGT includes an HRSG (suitable
                                         for a power facility) and DRI capability, SESHK agrees to share its experience in overseas
                                         project development with the Company within the Territory.

 

		5.	SESHK commits that the personnel to be
                                         joining the Company from SESHK’s Affiliates have the capability and resources to
                                         independently complete gasification proposal, PDP for ***MP(a)(similar to ZZ Plant) and
                                         ***MP(a)(similar to Yima Plant),instruct the engineering work of detailed engineering
                                         design of the third party, detailed engineering design review, training operators of
                                         project owner, and compose analysis/operation/maintenance/handbook, and SESHK warrants
                                         that such documents comply with the content and depth of the requirements of current
                                         China standards.

 

		6.	SESHK agrees that the Company will sign
                                         employment contracts with its employees, pay salaries and terminate employment contracts,accordingto
                                         the HR policies of the Company.

 

		7.	SESHK will provide appraisal report 2014
                                         1002 issued by Beijing Guan Fu Li Dao Appraisal Firm for the filing which shall include,
                                         but not limited to, above annex, patent list, and technology materials original (copy)
                                         and other related documents and assisting for filing and registration.

 

		8.	Considering SESHK and its Affiliates
                                         have different function on technology, commercial, taxation etc. in the structure, here
                                         SESHK and ZCM sign the Contract, SESHK’s affiliates shall jointly agree to
                                         ensure that SESHK will meet its affirmative obligations under the Contract and the TUCA,
                                         agrees and supports the representations made in this Annex 7, and shall also guarantee
                                         any liabilities that may arise in relation to the SGT guarantees for projects similar
                                         to the Zaozhuang Plant and the Yima Plant (as described in the Contract and TUCA) to
                                         the extent of the limit of liability under the PSA.

 

*** This information has been omitted
in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been filed separately with the Securities
and Exchange Commission.

 

    	2

    	 

    

 

This annex is an appendix to the JV Contract
and is a necessary supplement to the Contract. Matters not covered in this annex are governed by the JV Contract.

 

	By:  	 
	 
	Synthesis Energy Systems, Inc.

 

	Name:	ROBERT WAYNE RIGDON
	 	 
	Position:	President & CEO

 

	By:  	 
	Synthesis Energy Systems Technologies, LLC 

 

	Name:	ROBERT WAYNE RIGDON
	 	 
	Position:	President

 

    	3Technology
Usage and Contribution Agreement

 

Between

 

ZHANGJIAGANG
CHEMICAL MACHINERY CO., LTD.

 

and

 

SES ASIA
TECHNOLOGIES, LIMITED.

 

Related to
the Joint Venture Contract between 

 

Zhangjiagang
Chemical &Machinery Co., Ltd. 

And

SES Asia
Technologies, LIMITED.

 

Dated 14
February 2014

 

    	 

    	 

    

 

TABLE
OF CONTENTS

 

	1.	Definitions	3
	2.	SESHK’s Contribution to the Registered Capital of the Company	5
	3.	Contribution Schedule and Handover	7
	4.	SESHK’s Guarantee	7
	5.	Exclusivity	8
	6.	Improvements	9
	7.	Operation of the Company	9
	8.	Marks	12
	9.	SESHK Additional Services and Technology Implementation	15
	10.	Protection of Intellectual Property Rights	16
	11.	Assignment	16
	12.	Default and Termination	17
	13.	Indemnification	18
	14.	Notice	18
	15.	Confidentiality	19
	16.	Miscellaneous	20

 

    	2

    	 

    

 

Technology Usage
and Contribution Agreement

 

THIS TECHNOLOGY USAGE AND CONTRIBUTION
AGREEMENT (this “Agreement”) is made by and between SES Asia Technologies, Ltd. (“SESHK”)
and the Zhangjiagang Chemical Machinery Co., Ltd (“ZCM”) in relation to the establishment of in ZCM-SES Sino-US Clean
Energy Technologies Co., Ltd. (the “Company”). SESHK and ZCM are each herein referred to as a “Party”
and collectively as the “Parties.”

 

WHEREAS,
Synthesis Energy Systems Technologies LLC. (“SEST”) is the party to a license agreement with the Gas Technology Institute
(the “GTI Agreement”) to license and sub-license the GTI U-Gas® technology;

 

WHEREAS,
the U-Gas® technology has been further improved and modified by SEST and its Affiliates and SEST owns 100% of the SES Intellectual
Property for these improvements and modifications and such improvements and modifications have been achieved by SEST and its Affiliates
through (i)development, investment in and implementation of two commercial projects in China;(ii) numerous technical engineering
studies and additional Know-How; and (iii) extensive global customer development for potential project licenses. Before the Establishment
Date, SESHK has 100% proprietary rights and authorization of the SGT to be contributed to the Company by it.

 

WHEREAS,
SESHK and ZCM entered into a Sino-foreign equity joint venture contract to establish the Company on January 23, 2014 (the “Contract”),
with the goal of establishing the SGT as the leading gasification technology in China;

 

WHEREAS,
in furtherance of such goal, through this Agreement, SESHK is providing the Company with certain exclusive manufacturing and operation
rights relating to the SGT in the Territory under the Contract as its contribution to the registered capital of the Company as
agreed by SESHK and ZCM.

 

NOW,
THEREFORE in view of the foregoing premises and in consideration of the mutual promises and covenants contained in this Agreement,
SESHK and ZCM agree as follows.

 

		1.	Definitions

 

The
following words and phrases will have the meanings set forth below where used herein with initial capital letters. Capitalized
terms used but not defined herein shall have the meaning given such term in the Contract.

 

		1.1	“Confidential
                                         Information” has the meaning set forth under the Contract.

 

		1.2	“Effective
                                         Date” has the meaning as set out in the JV Contract.

 

		1.3	“License
                                         Fee” means a royalty based on the daily capacity of Syngas for which a Project
                                         is to be designed under a PSA.

 

    	3

    	 

    

 

		1.4	“Marks”
                                         means the marks listed in Annex B as well as any other trademark or service mark owned
                                         by, created by, or licensed to SESHK or its Affiliates and/or ZCM and/or the Company.

 

		1.5	“Project”
                                         means a third party project that is, in whole or in part, intended to use or utilize
                                         the SGT for the production of SGT related chemicals through the purchase of a valid and
                                         binding PSA.

 

		1.6	“Project
                                         Sublicense Agreement” or “PSA” means an agreement that includes
                                         the necessary technology sublicenses from the Company that are necessary for the operation
                                         of a Project in the Territory, under which the Company is the sub-licensor. The PSA will
                                         be subject to amendment per the customer’s requirements according Section 7.10
                                         below. The sample PSA attached as Annex 5 of the Contract shall serve as reference and
                                         may be subject to amendments as per the requirements of the client in practices provided
                                         that the SGT is protected and will be upheld during the implementation of the Project.

 

		1.7	“Proprietary
                                         Information” includes, without limitation, any and all drawings, plans, designs,
                                         material specifications, dimensions, tolerances, processes, prototypes, assembly procedures,
                                         quality control procedures, and other technical information, data and know-how.

 

		1.8	“SES
                                         Intellectual Property” means the patents and patent applications listed in
                                         Annex A as well as any other patent, patent application, copyright, copyrightable
                                         work, registered design, invention, Improvement, trade secret, know-how, Proprietary
                                         Information, or other intellectual property rights owned by, created by, or licensed
                                         to SESHK and related to the SGT, which includes, inter alia, the SGT and the Know-How.
                                         These intellectual properties shall be listed in Annex C on the effective date of this
                                         Agreement.

 

		1.9	“SGT”
                                         shall include the collection of SES Intellectual Property, Know-How, trade secrets and
                                         methods developed by SESHK’s Affiliates for its advanced fluidized bed gasification
                                         technology. The SGT has been extensively developed since 2004 and was initially based
                                         upon the U-Gas® technology licensed by SESHK and its Affiliates from GTI, and which
                                         has been further developed through additional improvements, Know-How and patents developed
                                         by SESHK’s Affiliates through industry experience of SESHK’s Affiliates from
                                         developing, designing and operating projects in China and from designs by or for SESHK
                                         and its Affiliates in their development of projects globally. The SGT is one of the most
                                         advanced gasification technologies, which has been commercialized through the construction
                                         and operation of industrial projects to be reliable, environmentally-friendly, economically
                                         feasible, sustainable and in conformity with China’s energy independence policy
                                         and energy strategies. SGT is a part of the equity contribution of SESHK as described
                                         in the Agreement. Before the Establishment date SESHK has 100% proprietary rights and
                                         authorization of the SGT to be contributed to the Company. And any improvement after
                                         the Company is established and developed by the Company belong to the Company, as described
                                         in this Agreement.

 

    	4

    	 

    

 

		1.10	“SGT
                                         Feedstock” shall mean low quality coal (a coal with a heating value of less
                                         than4,000 kcal/kg or in excess of 20% ash or in excess of 20% total moisture), coal waste
                                         materials, renewable fuels such as biomass, refuse derived fuels, and municipal waste,
                                         or any mixture of the above (coal shall not be less than 60%), or other carbonaceous
                                         materials as mutually agreed which may be converted into Syngas via the SGT.

 

		1.11	“Sub-license
                                         Royalty To GTI” shall mean ***% of the license fee subtracted from any license
                                         fee received by the Company under any licensed project for payment to be paid to GTI,
                                         pursuant to the legally effective agreement between SEST and GTI, after the Company obtains
                                         the exclusive SGT rights in the Territory.

 

		1.12	“Synthesis
                                         Gas” or “Syngas” means a mixture of CO, H2, CH4
                                         and CO2 produced using the SGT process. Syngas capacity from the SGT
                                         may be licensed as a defined daily quantity of CO + H2 or CO + H2 +
                                         CH4, the details of which must be spelled out in a Project
                                         Sublicense Agreement.

 

		2.	SESHK’s
                                         Contribution to the Registered Capital of the Company

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been
filed separately with the Securities and Exchange Commission.

 

    	5

    	 

    

 

		2.1	Subject
                                         to the terms set out by the Contract and for the purpose of the Company to achieve its
                                         business objective and obtain exclusive authorization of the SGT within the Territory,
                                         SESHK undertakes, as its contribution to the registered capital of the Company, to fully
                                         authorize and grant to the Company the full access to and authorization for the SGT as
                                         follows: 

 

		(a)	grant
                                         site specific PSAs to third parties for the purpose of enabling such third parties to
                                         operate their Project(s) to supply a defined capacity of Syngas that is produced using
                                         the SGT;

 

		(b)	use
                                         the SES Marks for the SGT Proprietary Equipment and Services that utilize SES Intellectual
                                         Property including the SGT and in accordance with the requirements of this Agreement;

 

		(c)	engineer
                                         and/or design processes that utilize SES Intellectual Property including the SGT and
                                         provide such process designs exclusively through PDPs for Projects holding a valid, binding
                                         PSA pursuant to this Agreement;

 

		(d)	provide
                                         Services for Projects holding a valid and binding PSA pursuant to this Agreement;

 

		(e)	take
                                         over the development of Projects in the Territory that have previously been developed
                                         by SESHK and its Affiliates as shown in Annex C, which may use the SGT, and for which
                                         SESHK and its Affiliates shall, upon the Effective Date, forgo the relevant sales activities
                                         according to the terms agreed by the Parties.

 

		2.2	Subject
                                         to the terms of the Contract, the above granting by SESHK of the relevant exclusive rights
                                         and authorizations and the access to the SGT within the Territory, and others as may
                                         be mutually agreed, shall be equivalent to RMB 53,800,000 (in Words: Renminbi fifty-three
                                         million eight hundred thousand), according to an appraisal by a legally formed appraisal
                                         company in accordance with the relevant appraisal regulations in the PRC, representing
                                         thirty-five (35%) percent of the total registered capital of the Company. Both Parties
                                         confirm that the value of such appraisal will not be affected due to any future factors.

 

    	6

    	 

    

 

		3.	Contribution
                                         Schedule and Handover

 

		3.1	SESHK shall make the above contributions
                                         to the registered capital of the Company within thirty (30) days of the issuance of the
                                         business license of the Company.

		3.2	The Company shall confirm the
                                         completion of the contribution of SESHK following due completion of the activities set
                                         forth above in Section 3.1 by issuing a written certificate of contribution to SESHK.

		3.3	SESHK shall assist the Company
                                         for the filing of SGT related documents (including copies of patents) as described in
                                         this TUCA.

 

		4.	SES HK’s
                                         Guarantee

 

		4.1	SESHK
                                         warrants that the Company shall be the exclusive operational entity for businesses relating
                                         to the SGT within the Territory during the term of this Agreement and no other entities
                                         and/or individuals, including SESHK and its Affiliates, shall conduct any SGT related
                                         operational business (excluding the existing ZZ Plant and Yima Plant as well as equity
                                         investments solely developed by SESHK or its Affiliates in the Territory, which shall
                                         obtain authorization for the usage of the SGT or any SGT Proprietary Equipment from the
                                         Company) within the Territory. During the Joint Venture Term, if the Company loses the
                                         exclusivity of the SGT usage rights due to reasons attributable to a breach by SESHK
                                         of its warranties under the Contract, in addition to compensation of any losses to ZCM
                                         pursuant to the relevant legal requirement, the actual profits of the Projects undertaken
                                         by SESHK in violation of such exclusivity shall be paid unconditionally to ZCM by SESHK.

 

		4.2	SESHK
                                         warrants that the exclusive usage rights of the SGT which it has granted to the Company
                                         are legitimate and continuously existing. During the Term of the Company, all legal disputes
                                         arising due to the license between SESHK and its Affiliates and GTI shall have nothing
                                         to do with ZCM/the Company and shall be handled by and be the responsibility of SESHK.

 

		4.3	SESHK
                                         shall be responsible for the completeness and reliability of the SGT contributed to the
                                         Company for projects similar to the ZZ Plant and Yima Plant. SESHK shall guarantee that
                                         the SGT has the ability to meet the performance and operational needs of actual Project
                                         in an economic and environmentally sound manner. For the PDP design for Projects similar
                                         to the ZZ Plant and Yima Plant, the Company will not be required to pay any expenses
                                         and fees to SESHK.

 

		4.4	SESHK
                                         undertakes to provide the Company with all the SGT Know-How and technical data as described
                                         under Annex 2 to the Contract. For 0.2MPa and 1.0PMPa Projects similar to the ZZ Plant
                                         and/or Yima Plant (new technology excluded), SESHK shall be responsible for the various
                                         guaranteed technology performance parameters under the PSA for the Project. SESHK shall
                                         guarantee the Company’s capability to produce complete designs and guaranteed performance
                                         for the SGT (similar to ZZ Plant and/or Yima Plant), and SESHK will bear the costs of
                                         support and assistance by SESHK and its Affiliates and/or its partners if needed. After
                                         the Company has completed two Projects (similar to ZZ Plant and/or Yima Plant) and once
                                         these Projects have achieved their required guaranteed technology performance parameters,
                                         SESHK shall not be required to continue providing such guarantees or support or assistance
                                         thereafter as the Company shall be deemed to be fully capable.

 

    	7

    	 

    

 

		4.5	SESHK
                                         shall be responsible for training any technical personnel of the Company free of charge
                                         (excluding process training for Projects not similar to ZZ Plant and Yima Plant) until
                                         (i) the employees of the Company are capable of independent technical work; or (ii) the
                                         conclusion of the first two (2) years of the Company’s operation.

 

		4.6	SESHK
                                         shall provide written documents listing all the SGT related proprietary technology, Know-How
                                         and technical data (as set forth under Annex 2 to the Contract) currently owned by it
                                         upon the effective date of this Agreement. With regard to any improvement made by the
                                         Company after its establishment including patent and proprietary technology, etc., it
                                         is agreed as follows: the ownership of the items listed under the Annex 2 to the Contract
                                         shall belong to SESHK, while all technical Improvements independently developed by the
                                         Company after the establishment of the Company shall be owned by the Company subject
                                         to Section 6.

 

		5.	Exclusivity

 

		5.1	The
                                         exclusive rights contributed by SESHK to the Company under this Agreement and the exclusive
                                         cooperation between SESHK and ZCM via the establishment and the operation of the Company
                                         shall be subject to the rights and obligations set out in this Agreement. During the
                                         Joint Venture Term, any SGT related market development activities within the Territory
                                         shall be executed by the Company unless otherwise agreed by SESHK and ZCM, excluding
                                         pure equity investment projects independently developed by SESHK or its Affiliates where,
                                         however, the production and sale of SGT Proprietary Equipment and technology license
                                         shall be sourced from the Company.

 

		5.2	The
                                         Company shall set up a project reporting mechanism within one (1) month of its establishment,
                                         by which, any Projects of the Company will be reported to SESHK, and thereafter SESHK
                                         shall report such information to GTI according to the agreement executed between SESHK
                                         and GTI.

 

		5.3	Within
                                         the term of the Company, the Company shall be the exclusive legal entity in the Territory
                                         for the development and implementation of gasification technology that uses SGT Feedstock.
                                         ZCM or the Company, alone or together, shall not engage in any market activities for
                                         any SGT projects outside the Territory, nor establish joint ventures or other entities.
                                         If ZCM or the Company receives formal quotation requests in writing from outside the
                                         Territory for any similar SGT project, it shall notify SESHK in writing immediately,
                                         and SESHK may agree to develop such project together with the Company. After the early
                                         termination of the Company, if ZCM desires to engage in similar SGT development, it must
                                         obtain SESHK’s written consent under mutually agreeable terms. After the expiration
                                         of the Company, both Parties shall proceed as mutually agreed.

 

		5.4	Within
                                         the Territory, SESHK or its Affiliates may pursue and develop equity investment projects
                                         for SESHK or its Affiliates. If such project to be developed for equity investment by
                                         SES or its Affiliates shall use the SGT, such use must be licensed through the Company
                                         for implementation of the SGT and/or equipment sale.

 

    	8

    	 

    

 

		5.5	The
                                         Parties agree as follows with respect to the right of exclusivity as granted to the Company
                                         within the Territory:

 

		(a)	Without
                                         prejudice to Section 5.4 above, SEST and its Affiliate shall transfer its sales and development
                                         effort for Projects carried on by it in Indonesia, Vietnam, the Philippines, Mongolia
                                         and Malaysia as provided in Annex D hereto before the establishment of the Company and
                                         transfer such Projects to the Company within ninety (90) days of the Effective Date.
                                         All pre-transaction costs for the above Project development will be settled by negotiation
                                         between the Company and SESHK;

 

		(b)	Within
                                         the first five (5) years of the establishment of the Company, if no SGT Project has been
                                         substantially developed in Indonesia, Vietnam, the Philippines, Mongolia, or Malaysia,
                                         the Parties shall negotiate the cancellation of the exclusivity to the Company in these
                                         countries.

 

		6.	Improvements

 

		6.1	If any
                                         Party, the Company, or its Affiliates should make, or acquire, any Improvements, whether
                                         patentable or not, relating to the SGT then such Party or the Company hereby grants to
                                         the other Party or the Company for the term of this Agreement, an irrevocable, non-exclusive,
                                         royalty-free right to use or license such Improvements. Each Party and the Company hereby
                                         agrees to disclose to the other Party or the Company any Improvements and the nature
                                         and manner of applying and utilizing such Improvements within three (3) months of discovery
                                         of the Improvement. All such Improvements disclosed shall become and thereafter be a
                                         part of the SGT and both Parties and the Company shall have the same rights, licenses
                                         and obligations with respect to the Improvement. ZCM’s use of the Improvements
                                         is limited to the manufacturing of the SGT Proprietary Equipment and is not extended
                                         to any other business unrelated to the SGT Proprietary Equipment.

 

		6.2	During
                                         the Term of the Contract, the Company shall have all rights to the Improvements within
                                         the Territory, while SESHK shall have all rights to the Improvements outside the Territory.
                                         The Company shall secure patents for any Improvements within the Territory if practical.
                                         SESHK or Affiliates of SESHK shall secure patent for Company Improvements outside the
                                         Territory for their protection.

 

		7.	Operation
                                         of the Company

 

		7.1	Pursuant
                                         to Section 2.1 above, the Company grants SGT sublicenses to Projects. The Company will
                                         grant site specific PSAs, sell SGT Proprietary Equipment, and provide Services to third
                                         parties in the Territory for the purpose of enabling such third parties to use the SGT
                                         for Projects.

 

		7.2	Each
                                         PSA for a Project will include a License Fee which is royalty based according to the
                                         daily capacity of Syngas for which the Project is to be designed. The Company will use
                                         all reasonable commercial efforts to maximize the License Fee for each PSA. License Fees
                                         will be based on Syngas capacity and will utilize the following calculation method where
                                         *** = *** per ***; *** = *** and *** = ***:

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	9

    	 

    

 

			License
                                         Fee = ***

 

		7.3	The
                                         Company management will determine the maximum SGT license fee achievable for each Project
                                         based on the market application, country, competition and SGT technology differentiation
                                         and advantages.

 

		7.4	The
                                         Company will pay to SESHK, *** of the License Fees received for each PSA for the purpose
                                         of enabling SEST to fulfill its obligation of paying GTI the Sub-license Royalty. Payments
                                         of the License Fees whether in its entirety or in installments set forth in the PSA will
                                         be directly paid within fifteen (15) days of receipt of the License Fees by the Company
                                         to SESHK and through SESHK to GTI pursuant to the GTI Agreement. Within fifteen (15)
                                         days after the Company has made such payments, SESHK shall provide the Company proof
                                         of payment to GTI.

 

		7.5	All
                                         amounts payable related to the Sublicense Royalty to GTI under a project, after such
                                         amounts have been examined and verified by the Company, and after paying the withholding
                                         taxes and other relevant expenses in accordance with applicable legal requirements and
                                         deducted therefrom by the Company, shall be paid by the Company to SESHK. Any amounts
                                         not timely paid shall be subject to an interest charge of the average of the daily prime
                                         rate of Citibank (New York) at the close of each day’s business, plus two percent
                                         (2%) per annum beginning on the day when such payment has become due and continuing until
                                         the day when such payment is made. Notwithstanding this Paragraph, failure to make any
                                         payment on or before its due date shall be a default by the Company for purposes of Section
                                         12hereof.

 

		7.6	All
                                         amounts specified in this Agreement related to a PSA are in U.S. Dollars and shall be
                                         paid in U.S. Dollars and be remitted, preferably by wire transfer, to SESHK upon ten
                                         (10) days prior written notice thereof to the Company.

 

		7.7	Each
                                         PSA will require that a Project have a PDP and must purchase its SGT Proprietary Equipment
                                         and Technical Services from the Company for which the price and terms will be defined
                                         in separate agreements for PDP, equipment sales and technical services or as a part of
                                         an overall packaged offering.

 

		7.8	For
                                         the avoidance of doubt, no project, customer or any third party may be sold a PDP, SGT
                                         Proprietary Equipment or Services by the Company without a valid, binding PSA in place
                                         first with such third party, except in the instance of providing preliminary technical
                                         proposals to customers for market development purposes.

 

		7.9	A
                                         list of potential Projects under development by the Company must be maintained and submitted
                                         to SESHK quarterly for inclusion in SESHK’s quarterly submittal to GTI, and SES
                                         HK’s and GTI’s consent for such Projects shall not be unreasonably rejected.

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	10

    	 

    

  

		7.10	PSA
                                         must substantially follow the standard form of License Agreement provided in Annex 5
                                         of the Contract. Any material modifications to the standard form of License Agreement
                                         must be mutually agreed by the Parties. Each PSA must include (i) terms requiring the
                                         automatic assignment of the PSA to SESHK upon termination of this Agreement, and (ii)
                                         confidentiality terms at least as restrictive as those in this Agreement. The terms and
                                         conditions for the above assignment will be negotiated and agreed separately.

 

		7.11	A
                                         copy of an executed PSA must be provided to SESHK in English and Chinese. SESHK will
                                         provide copies of this information to GTI per the terms of the GTI Agreement.

 

		7.12	The
                                         engineering works (including but not limited to PDPs, basis for design, CDPs, process
                                         flow diagrams (PFDs), piping and instrumentation diagrams (P&IDs), Proprietary Equipment
                                         data sheets, control and safety system logic, start-up and operating procedures and material
                                         selection guide) prepared by the Company must be submitted to SESHK for examination and
                                         approval for conformity to SESHK standards before being delivered to customers and applied
                                         to projects. The Company will submit all engineering works at least three weeks prior
                                         to the date that approval is needed. Notification of the expected submission dated for
                                         documents needing review will be submitted to SESHK upon execution of a PSA and/or PDP
                                         agreement by the Company.

 

Alternatively
the Company and SESHK may establish reviews of works in progress based on mutually agreeable terms in order to facilitate speedy
completion of deliverables while maintaining quality standards. If SESHK determines the relevant engineering works do not meet
expectations, SESHK shall identify the issues for modification by the Company.

 

		7.13	Copies
                                         of all technology works in progress, patents and patent disclosures, studies, feasibility
                                         study reports, and PDPs of the Company shall be transmitted to SESHK upon completion
                                         of the relevant work or Project. Meanwhile, copies of all technology works in progress,
                                         patents and patent disclosures, studies, feasibility study reports and PDPs of SESHK
                                         and its Affiliates outside the Territory, shall be transmitted to the Company upon completion
                                         of the relevant work or Project.

 

    	11

    	 

    

 

		8.	Marks

 

		8.1	The Company’s marks shall
be unanimously approved by the Board after the Company’s establishment, which could be “SESHK mark and/or ZCM mark
and/or other mark”. The Company shall be entitled to apply for registration of any trademarks of the Company in both Chinese
and English for the use of such trademarks on any goods, products, equipment, advertising and promotional items within the Territory.

 

		8.2	SESHK
                                         and/or ZCM will provide the Company with the SGT and/or ZCM related trademarks for the
                                         development of the business of the Company. SESHK and/or ZCM will retain all ownership
                                         of their respective trademarks and grant the Company a royalty free license for those
                                         trademarks as long as and to the extent necessary for the Company to fulfill its operation
                                         purposes under this Agreement.

 

		8.3	All
                                         SGT and SGT Proprietary Equipment to be marketed by the Company shall bear the SESHK
                                         and/or ZCM brand(s) for the SGT and SGT proprietary equipment. The Company may have another
                                         SESHK and/or ZCM-related brand if so unanimously approved by the Board.

 

		8.4	The
                                         Company acknowledges the validity of the Marks and the relevant Party’s sole and
                                         exclusive right, title and interest in and to the Marks, including the right to register
                                         or to have registered the Marks, and such relevant Party’s own and control all
                                         of the goodwill associated with their respective Marks and such goodwill shall remain
                                         at all times the sole and exclusive property of the relevant Party. Apart from its rights
                                         under this Agreement, the Company will not acquire any right, title or interest in the
                                         Marks during or after the Term. The Company recognizes the great value of the publicity
                                         and goodwill associated with the Marks and acknowledges that such goodwill exclusively
                                         belongs to the relevant Party and that the Company's use of the Marks will inure solely
                                         for the benefit of the Company.

 

		8.5	The
                                         Company acknowledges that the maintenance of SESHK/ZCM’s quality standards for
                                         services and products which bear the Marks are material conditions of this Agreement
                                         and that SESHK and/or ZCM is relying upon the Company's representation and warranty that
                                         they will use the Marks only in a manner approved by SESHK and/or ZCM and consistent
                                         with such quality standards. Without limitation on the foregoing, The Company agrees
                                         that it shall comply with each of the following (collectively, “SESHK/ZCM Standards”):

 

		(a)	The
                                         Company agrees that it will use reasonable efforts to comply with all conditions set
                                         forth in writing from time-to-time by SESHK and/or ZCM with respect to the style, appearance
                                         and manner of use of the Marks. In addition, upon SESHK and/or ZCM's request, the Company
                                         shall place all notices reasonably acceptable to SESHK and/or ZCM on any Mark usage and
                                         any marketing, advertising, or promotional materials bearing the Marks to identify the
                                         licensed use under this Agreement and the proprietary rights of SESHK and/or ZCM in such
                                         Marks;

 

    	12

    	 

    

 

		(b)	All
                                         marketing, advertising and promotional material shall be subject to review from time
                                         to time by SESHK and/or ZCM with respect to, but not limited to, content, style, appearance,
                                         and composition;

 

		(c)	The
                                         Company will use and display the Marks only in a form and style which does not defame,
                                         disparage, dilute, place in a bad light, or otherwise injure SESHK and/or ZCM, any Affiliate
                                         of SESHK and/or ZCM, or any owner, officer, or director of SES or any of their respective
                                         Affiliates;

 

		(d)	The
                                         Company will not represent in any manner that it has any ownership interest in the SESHK
                                         and/or ZCM Marks or any goodwill associated therein. The Company will not represent in
                                         any manner that it has any rights in or to the Marks other than as set forth in this
                                         Agreement;

 

		(e)	The
                                         Company further agrees that it will not apply for nor seek to obtain trademarks, service
                                         marks, registrations or any other property rights in the Marks;

 

		(f)	The
                                         Company agrees that if the Company receives knowledge of any usage or exploitation of
                                         the Marks, or of other confusingly similar mark, by any person or entity other than the
                                         Company or SESHK and/or ZCM, and if the Company has a belief that such use is not approved
                                         by SESHK and/or ZCM, then the Company will promptly notify SESHK and/or ZCM in writing
                                         and shall assist SESHK and/or ZCM in any enforcement action SESHK and/or ZCM may elect
                                         to bring in its sole and absolute discretion; and

 

		(g)	The
                                         Company shall undertake any corrective actions requested by SESHK and/or ZCM in order
                                         to comply with SESHK-ZCM’s Quality Standards in a timely and professional manner
                                         and shall provide SESHK and/or ZCM with such evidence of compliance as SESHK and/or ZCM
                                         may reasonably request.

 

		8.6	The
                                         Company agrees that:

 

		(a)	During
                                         the Term and thereafter, The Company will not attack any of the Marks, trade names, domain
                                         names or other intellectual property rights pertaining to the Marks in the Territory
                                         or anywhere in the world, and will not aid or assist any third person or entity in doing
                                         so;

 

    	13

    	 

    

 

		(b)	The
                                         Company will not harm, misuse or bring into dispute the Marks in the Territory or anywhere
                                         in the world;

 

		(c)	The
                                         Company will use and exploit the Marks only in accordance with the terms and intentions
                                         of this Agreement; and

 

		(d)	The
                                         Company will comply with all laws and regulations relating or pertaining to the use or
                                         exploitation of the Marks and shall maintain SESHK/ZCM’s Quality Standards for
                                         the goods and services provided by the Company which bear, are related to or are otherwise
                                         in connection with the Marks, and shall further comply with any regulatory agencies which
                                         have jurisdiction over the Marks.

 

		(e)	The
                                         Company’s use of the Marks will be subject to SESHK approval and be in accordance
                                         to SESHK/ZCM Standards.

 

		8.7	As of the
                                         establishment date of the Company, both Parties have 100% ownership to the Marks as listed
                                         in Annex B. After the establishment of the Company, the marks developed by the Company
                                         shall be 100% owned by the Company.

 

    	14

    	 

    

 

		9.	SESHK
                                         Additional Services and
                                         Technology Implementation

 

		9.1	Subject
                                         to the terms and conditions as set forth under the Contract and this Agreement, SESHK
                                         will provide design and engineering reviews for the benefit of the Company and SESHK
                                         will supply technical services to the Company to enable the Company to deliver PDPs to
                                         Qualified Projects that license the SGT from the Company.

 

		9.2	SESHK
                                         will provide timely review of PDPs and equipment designs to assure they meet SGT quality
                                         standards and will perform as required.

 

		9.3	SESHK
                                         will provide to the Company engineers who are experienced in and capable of preparation
                                         of PDPs as its employees and will be responsible for the PDP design work. SESHK shall
                                         second one senior technical expatriate engineer with significant experience with the
                                         SGT to the Company through the first anniversary of the Effective Date to serve as the
                                         Company’s chief technology officer (“Company CTO”). The Company shall
                                         pay the salaries of the above Seconded Personnel.

 

		9.4	SESHK
                                         will provide necessary support and training to the Company’s employees in accordance
                                         with the plan as developed and implemented by SESHK and the Company on a mutually agreed
                                         basis, to enable the Company to complete the PDPs in accordance with Section 2.1, Section
                                         7.7 and Section 7.12.The Company will pay SESHK its actual costs for such support and
                                         training, except for projects similar to ZZ Plant and Yima Plant which will be provided
                                         free of charge by SESHK.

 

		9.5	SESHK
                                         will provide the Critical Design Parameters free of charge for every Project which implements
                                         the SGT.

 

		9.6	SESHK
                                         will provide technical support, as reasonably requested by the Company, in connection
                                         with preparation of PDPs, start-up and commissioning for Projects. The Company will pay
                                         SESHK its actual costs for such support, except for projects similar to ZZ Plant and
                                         Yima Plant which will be provided free of charge by SESHK.

 

		9.7	SESHK
                                         will assist the Company to obtain access to the GTI and other third party testing facilities,
                                         with costs fully reimbursed by the Company, if applicable.

 

    	15

    	 

    

 

		10.	Protection
                                         of Intellectual Property Rights

 

		10.1	The
                                         Parties will establish a joint Intellectual Property Committee with two (2) members from
                                         the Company and two (2) members from SESHK. This committee shall review all Improvements
                                         and intellectual property protection measures annually to develop recommended patent
                                         disclosure measures to protect all types of SGT and Improvements and shall make such
                                         recommendation to the Company Board on an annual basis.

 

		10.2	The
                                         Parties shall inform each other immediately of any infringements, misuse, or misappropriations
                                         of any portion of the SGT in the Territory.

 

		10.3	SESHK
                                         and the Company shall both be entitled to take action against infringers either separately
                                         or jointly in the enforcement of rights related to the SGT, Know-How and Improvements
                                         in the Territory. Any enforcement conducted by the Company or SESHK shall be at their
                                         own expense. If action is taken jointly then the costs shall be shared equally or as
                                         otherwise agreed by the Parties. The Parties shall assist each other with reasonable
                                         efforts in such actions. In the event of an enforcement action taken by the Parties jointly,
                                         SESHK and the Company may enter into a separate agreement related to the allocation of
                                         the reimbursement based on their respective losses suffered.

 

		10.4	The
                                         Company/SESHK shall protect the SES Intellectual Property/SGT, the Know-How and Improvements/Company
                                         Improvements in any form, including calculations, methodologies, software, spreadsheets,
                                         computer programs and mathematical algorithms which generally fall into the category
                                         of trade secrets and/or Confidential Information and shall never publish or patent such
                                         information without the written joint consent of the Company and SESHK. Such SES Intellectual
                                         Property/SGT, the Know-How and Improvements/Company Improvements shall be protected and
                                         secured as sensitive Confidential Information of the Company and SESHK. The Company/SESHK
                                         must take all efforts to limit such trade secrets to only those Working Personnel and
                                         Management Personnel who must use the information to conduct the business of the Company.
                                         The Company/SESHK must restrict all access or ability to photocopy or make electronic
                                         copies of such trade secrets and/or Confidential Information. Any violation of the aforesaid
                                         shall constitute a material breach of this Agreement and therefore lead to its termination.

 

		11.	Assignment

 

		11.1	This
                                         Agreement shall be binding upon the Parties hereto and the successors to substantially
                                         the entire assets and business of the respective Parties hereto. This Agreement shall
                                         not otherwise be assignable by either Party without the prior written consent of the
                                         other Party; provided, however, this Agreement shall be assignable by either Party to
                                         a successor to substantially all of the assets and business of such Party, provided such
                                         successor is not a competitor of SESHK/ZCM. Any and all assignments of this Agreement
                                         or of any interests therein not made in accordance with this section shall be void.

 

    	16

    	 

    

 

		11.2	The Parties acknowledge that
the damage or loss that would be caused by a breach of this Agreement would be difficult, if not impossible, to quantify, and
accordingly, notwithstanding Section 16.2, each Party and its Affiliates shall be entitled to specific performance to compel compliance
with the provisions of this Agreement.

 

		12.	Default
                                         and Termination

 

		12.1	Term.
                                         The term of this Agreement shall commence on the Effective Date of the Company and
                                         shall continue for twenty (20) years or until any such time the Contract is terminated
                                         or liquidation procedures for the Company are commenced pursuant to the Contract, or
                                         there is any other termination in accordance with this section. This Agreement can be
                                         renewed or terminated upon mutual written consent of the Parties.

 

		12.2	Suspension.
                                         In the event of a dispute between the Parties, both Parties shall continue the performance
                                         of this Agreement in all aspects. Notwithstanding the foregoing, if such dispute poses
                                         significant adverse impact on the performance of this Agreement in all aspects, either
                                         Party may suspend the performance of this Agreement.

 

		12.3	Termination
                                         Following Breach. If either Party shall be in default of, or otherwise breaches,
                                         any obligation hereunder, resulting in a failure to achieve the purpose of the Contract
                                         or this Agreement by the other Party, then the other Party may give written notice to
                                         the defaulting Party specifying the claimed particulars of such default and in the event
                                         the defaulting Party shall not have remedied such default within ten (10) days in the
                                         case of a monetary default, and thirty (30) days for a non-monetary default, after the
                                         date of such notice (or such a longer period of time to be approved in the sole discretion
                                         of, and in writing by, the non-defaulting Party, if such failure is capable of being
                                         cured and the defaulting Party is proceeding diligently to cure such default), the non-defaulting
                                         Party shall have the right thereafter to immediately terminate this Agreement by giving
                                         written notice to the defaulting Party to that effect.

 

		12.4	Termination
                                         Following Insolvency or Bankruptcy. This Agreement shall terminate immediately and
                                         automatically upon the act of the Company admitting in writing its inability to pay its
                                         debts generally as they become due, filing a petition in bankruptcy or under any other
                                         insolvency act, making an assignment for the benefit of creditors, or upon a petition
                                         in bankruptcy, or for the appointment of a receiver being filed against it, failing to
                                         have the petition or appointment dismissed or vacated within sixty (60) days from the
                                         date thereof.

 

		12.5	Implications
                                         of Termination. Except as otherwise expressly provided, any termination of this Agreement
                                         shall not release a Party from any claim of the other Party accrued hereunder prior to
                                         the effective date of such termination.

 

		12.6	Survival.
                                         The obligations of the Parties pursuant to Section8 and Sections 10 through 15of
                                         this Agreement shall survive any termination of this Agreement.

 

    	17

    	 

    

 

		13.	Indemnification

 

The
Company agrees to hold harmless, defend, and indemnify SESHK and its managerial staff, directors, employees, agents, Affiliates,
successors and assigns (the “SESHK Indemnified Parties”) from any and all claims, causes of action, losses,
costs, injuries or deaths, liabilities, damages and any and all expenses, including and without limitation to reasonable attorney’s
fees, incurred by SESHK Indemnified Parties, or the expenses and fees arising out of or relating to any of the follows:

 

		(a)	any misrepresentation or false
warranty made by the Company in this Agreement;

 

		(b)	any use or misuse of the SGT;
and

 

		(c)	any infringement or claimed
infringement of any aspect of the SGT upon the intellectual property rights of any third party. Such indemnification obligation
shall be effective throughout the Term of this Agreement, and shall survive the termination or expiration of this Agreement.

 

		14.	Notice

 

		14.1	Addresses.
                                         The addresses of the Parties hereto are as follows, but either Party may change its
                                         address for the purpose of this Agreement by notice in writing to the other Party:

 

ZCM:

 

No.
20 Chengyang Road, Houcheng, Jingang Town, Zhangjiagang City, Jiangsu Province, 215631, PRC

 

Attention:
XU, Ye

 

Telephone
No:0512-5673-9008

 

Facsimile
No.: 0512-5673-9009

 

SESHK:

 

7/F.,
Bonham Centre 79-85 Bonham Strand, Sheung Wan

 

Attention:
ROBERT WAYNE RIGDON

 

Telephone
No: 001-(713) 579-0600

    	18

    	 

    

 

		14.2	In
                                         the event notices, statements, payments received under this Agreement by a Party hereto
                                         are sent by certified or registered mail to the Party entitled thereto at the address
                                         provided for in this Agreement, they shall be deemed to have been given or made as of
                                         the date so mailed, and if sent by wire then as of the date transferred.

 

		15.	Confidentiality

 

		15.1	Except
                                         as hereinafter provided, the provisions of this Agreement and all information or documents
                                         which come into the possession of the Company, or its Affiliates, in connection with
                                         the performance hereof, and any other Confidential Information, may not be communicated
                                         to third parties without mutual consent by both Parties. However, the Company shall have
                                         the right to disclose such provisions, information or document without mutual consent:

 

		(a)	to Affiliates
                                         of the Company or their employees, provided such disclosure is solely to assist such
                                         person in performing the functions for which they were engaged in connection with any
                                         Project, and such persons undertake to keep such information or documents under terms
                                         of confidentiality equivalent to this Section 15, and provided further that a list of
                                         such persons receiving information pursuant to this section is provided to both Parties
                                         and is updated at least every thirty (30) days;

 

		(b)	to legal
                                         counsel, accountants, financial advisers, lenders, other professional consultants, and
                                         insurance underwriters for a Party, provided such disclosure is solely to assist such
                                         person in performing the functions for which they were engaged in connection with any
                                         Project, and such persons undertake to keep such information or documents under terms
                                         of confidentiality equivalent to this Section 15;

 

		(c)	if required
                                         by any court of law or any law, rule, or regulation having jurisdiction over a Party,
                                         or if requested or required by an agency of any government having or asserting jurisdiction
                                         over a Party, and having or asserting authority to require such disclosure in accordance
                                         with that authority or pursuant to the rules of any recognized stock exchange or agency
                                         established in connection therewith, provided, that a Party making such a required disclosure
                                         shall make good faith efforts to advise the other Party of the same as soon as reasonably
                                         practicable, and shall make reasonable efforts to secure protective treatment for the
                                         disclosed information and with respect to any disclosure requirements of any recognized
                                         stock exchange, shall cooperate with the non-disclosing Party regarding the information
                                         to be disclosed;

 

		(d)	to the
                                         extent any such information or document has (i) been independently developed by the Company,
                                         (ii) has been acquired from a third party who has no obligation of confidentiality or
                                         non-use in regards to the SGT, or (iii) entered the public domain other than through
                                         the fault or negligence of any Party hereto(for this purpose any disclosure by a person
                                         contemplated by Section 15.1(a) shall be deemed to be the fault or negligence of such
                                         Party); and

 

    	19

    	 

    

 

		(e)	to an
                                         arbitration tribunal in connection with resolution of a dispute under this Agreement.

 

		15.2	The
                                         confidentiality obligations of third parties who receive any information pursuant to
                                         Section 15.1 shall be set forth in a non-disclosure agreement between the Company and
                                         such third party substantially similar to the standard non-disclosure agreement attached
                                         as Annex D hereto. The confidentiality obligations set forth in such non-disclosure agreement
                                         shall expressly survive the termination or expiration of the agreement. A fully executed
                                         of such non-disclosure agreement shall be provided to SESHK by the Company.

 

		15.3	The
                                         Parties acknowledge and agree both Parties have entered into the Agreement under the
                                         condition that the SGT, the Know-How and all other relevant intellectual property will
                                         be protected by the Parties and the Company, and that the Parties and the Company shall
                                         protect all Confidential Information related to the SGT, Improvements and Know-How, and
                                         any Confidential Information of the Parties, and ensure that all such information is
                                         not transmitted to third parties and all SGT Confidential Information is returned to
                                         SESHK at the end of the Term, and all ZCM Confidential Information is returned to ZCM
                                         at the end of the Term or upon liquidation of the Company and is not used by ZCM or the
                                         Company except as specifically authorized under this Agreement. The Parties agree that
                                         the default on confidential obligation may constitute material breach of this Agreement,
                                         and thus result in termination of this Agreement, except, however, SGT related Confidential
                                         Information obtained by any third party not by reason attribute to a breach by the Company
                                         or a Party.

 

		16.	Miscellaneous

 

		16.1	Each
                                         party represents and warrants to the other that: 

 

		(a)	it is an entity duly formed,
validly existing, and in good standing and has all requisite power and authority to make, execute and deliver this Agreement and
to consummate the transactions contemplated herein;

 

		(b)	the execution, delivery and
performance of this Agreement and the consummation of the transactions contemplated hereby, have been duly approved and authorized
by all necessary corporate actions on its behalf;

 

    	20

    	 

    

 

		(c)	neither the execution and delivery
of this Agreement by it nor the consummation by it of the transactions contemplated hereby, will constitute a violation of, or
be in conflict with: (i) any judgment, decree, order, regulation or rule of any governmental authority; (ii) any law, regulation
or order of any governmental authority; or (iii) any agreement entered into with a third party; and

 

		(d)	it has the full right to grant
the rights, assignments and licenses granted by it in this Agreement.

 

		16.2	All
                                         disputes arising out of this Agreement shall be settled in accordance to Article 27 of
                                         the Contract.

 

		16.3	The
                                         validity and interpretation of this Agreement and the legal relations of the Parties
                                         to it shall be governed by the published and publically available laws, rules and regulations
                                         of China. If there are no published or publically available Chinese laws, rules and regulations
                                         or international treaties or conventions governing a particular matter, the then current
                                         general business practices in China shall apply, to the extent that they are in conformity
                                         with generally accepted international business practices and principles. 

 

    	21

    	 

    

 

		16.4	Severability;
                                         Compliance with Law. If one or more provisions of this Agreement should be held invalid
                                         for any reason whatsoever by any court, administrative agency, or arbitration board,
                                         such provision or provisions shall be severed from this Agreement and the remainder of
                                         the Agreement shall remain in effect. None of the provisions of this Agreement shall
                                         be construed so as to require the commission of any act contrary to law, and wherever
                                         there is any conflict between any provision of this Agreement and any material statute,
                                         law or ordinance, the latter shall prevail; but in such event the provision of this Agreement
                                         affected shall be curtailed and limited only to the extent necessary to bring it within
                                         the legal requirements and the remainder of the Agreement shall remain in effect without
                                         modification. Each Party agrees to comply with all applicable laws and regulations as
                                         well as appropriate business standards when conducting activities under this Agreement.
                                         This obligation shall apply to the activities of employees of such Party in their relations
                                         with employees of the other Party, including, but not be limited to, establishing precautions
                                         to prevent its employees from making, receiving, providing or offering any substantial
                                         gifts, extravagant entertainment, payments, loans or other considerations. Without limitation
                                         to the foregoing, each Party agrees that it shall not furnish, deliver, or release the
                                         technology, services, software, or commodities made available to it hereunder to any
                                         individual, entity, or destination, or for any use, except in full accordance with all
                                         applicable laws, regulations, and requirements of home countries (or districts) with
                                         respect to export control and trade sanctions. Each Party will comply with all prohibitions
                                         on transactions with or transfers to the nations or governments where the parties located
                                         in or operated from, subject to comprehensive economic sanctions of all home countries
                                         (or districts), and prohibitions on transactions with or transfers to entities or individuals
                                         identified on the government’s List of Specially Designated Nationals and Blocked
                                         Persons (relevant Bureau) and Denied Persons List and Entity List (relevant Bureau) of
                                         the home countries (districts). Each Party agrees and understands it shall be responsible
                                         for ongoing compliance with all such applicable laws, regulations, and requirements.

 

		16.5	Entire
                                         Agreement. This Agreement (including all schedules and attachments, which are a part
                                         hereof), and the Contract, embody the entire understanding between SESHK and ZCM and
                                         any prior or contemporaneous representations, warranties or arrangements between the
                                         Parties relating hereto, either oral or written, are hereby superseded.

 

    	22

    	 

    

 

		16.6	Publicity.
                                         Neither Party will make any announcement of any kind, oral or written, public or private,
                                         to any external party, including the media, governments or financial institutions, regarding
                                         this Agreement without the prior written consent of the other Party, except to the extent
                                         required by any court of law or any law, rule, or regulation having jurisdiction over
                                         a Party, or if requested or required by an agency of any government having or asserting
                                         jurisdiction over a Party, and having or asserting authority to require such disclosure
                                         in accordance with that authority or pursuant to the rules of any recognized stock exchange
                                         or agency established in connection there with. In the event that the Company mentions
                                         the U-GAS Process that is the subject matter of this Agreement in writing in any press
                                         release or other promotional documentation, the Company shall include the phrase “Licensed
                                         from Gas Technology Institute and Synthesis Entergy Systems, Inc.” in said release
                                         or promotional documentation.

 

		16.7	Headings.
                                         The headings in this Agreement are for informational purposes and should not be construed
                                         as altering the terms of the Agreement.

 

		16.8	Independent
                                         Status of Parties. The Parties enter into this Agreement solely on their own behalf and
                                         not on behalf of any other person or entity. No party is a third party beneficiary of
                                         this Agreement. Each party shall act as an independent contractor and shall not bind
                                         nor attempt to bind the other party to any contract, or any performance of obligations
                                         outside of this Agreement. Nothing contained or done under this Agreement shall be interpreted
                                         as constituting either party the agent of the other in any sense of the term whatsoever.

 

		16.9	Interpretation.
                                         The Chinese and English versions of this Agreement shall be equally valid. The choice
                                         of words used in this Agreement shall be deemed to be wording chosen by both Parties
                                         to express their mutual intent and agreement. Each Party acknowledges that it has had
                                         adequate opportunity and bargaining strength to review, negotiate, and revise this Agreement.

 

		16.10	Waiver.
                                         No waiver of any right or rights under this Agreement shall be of any effect or binding
                                         upon either Party unless such waiver is in writing and is signed by an authorized representative
                                         of the Party so waiving such right or rights. Further, no waiver of any right or rights
                                         under this Agreement shall be deemed a waiver of, acquiescence in or consent to any other
                                         breach or default occurring at any time.

 

    	23

    	 

    

 

		16.11	Modification.
                                         No changes, alteration or amendment of this Agreement shall be of any force or effect
                                         unless it is in writing, executed by authorized representatives of both Parties and such
                                         writing expressly states that it is to be an alteration or amendment of this Agreement.

 

		16.12	No
                                         Third Party Beneficiaries. Nothing in this Agreement is intended nor shall it be construed
                                         to give any person, other than the Parties hereto and their respective successors and
                                         permitted assigns, any right, remedy or claim under or in respect of this Agreement or
                                         any provisions hereof.

 

		16.13	Remedies.
                                         The Parties acknowledges that money damages would be an inadequate remedy for the damages
                                         of a Party arising from the breach of this Agreement by the other Party. Therefore, the
                                         Parties agree that either Party shall be entitled to other remedies, including injunction
                                         and specific performance, in the event of any breach or threatened breach of the provisions
                                         of this Agreement by the other Party. 

 

Unless
otherwise expressly provided in this Agreement, the rights and remedies set forth in this Agreement are in addition to, and not
in limitation of, other rights and remedies under this Agreement or available at law, and the exercise, or non-exercise of one
right or remedy will not be deemed a waiver of any other right or remedy.

 

		16.14	Force
                                         Majeure. Time and diligence of the Parties are of the essence to this Agreement, it being
                                         understood that in the event of any act of God, war, insurrection, strike or wildcat
                                         labor disturbance, or act or occurrence solely outside the direction or control of the
                                         Parties, which occasions some delay, the time periods set forth hereunder shall be extended
                                         for the duration of such act or occurrence.

 

		16.15	After
                                         obtaining the business license of the Company, the Parties agree hereby that the legal
                                         representative of the Company shall sign and stamp hereunder on the signature page, so
                                         to confirm that SESHK has completed its contribution to the Company, and the Company
                                         is bound by this Agreement. 

 

		16.16	This
                                         Agreement is an appendix to the JV Contract and is a necessary supplement to the Contract.
                                         This Agreement and the Contract shall have the same legal effect.

 

    	24

    	 

    

 

IN
WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized representatives as of the date
first set forth above.

 

Zhangjiagang
Chemical & Machinery Co., Ltd.

 

	By:	/s/ Chen, Yuzhong	 
	Name:	Chen, Yuzhong	 
	Title:	Chairman	 
	Date:	14 February 2014	 

 

SES ASIA TECHNOLOGIES, LIMITED.

 

	By:	/s/ Robert W. Rigdon	 
	Name:	Robert Wayne Rigdon	 
	Title:	President	 
	Date:	14 February 2014	 

 

ZCM-SES
SINO-US CLEAN ENERGY TECHNOLOGIES CO., LTD. 

 

	By:	 	 
	Name:	 	 
	Title:	 	 
	Date:	 	 

 

The
following undersigned jointly and severally agrees to be bound by the obligations of the Company under this Agreement:

 

    	25

    	 

    

 

Annex A

 

SES Intellectual
Property

 

U-Gas®
Patents (GTI)

U-Gas®
专利 (GTI)

 

	Patent
    Number专利号	Description描述
	US
    3,884,649	Coal
                                         Pretreater and Ash Agglomerating Gasifier

         

        煤的预处理和灰熔聚气化炉

         

	US
    3,867,110	Method
                                         of Coal Pretreatment

         

        煤的预处理方法

         

	US
    3,935,825	Coal
                                         Ash Agglomerating Device

         

        煤的灰熔聚设备

         

	US
    4,057,402	Coal
                                         Pretreatment and Gasification Process

         

        煤的预处理和气化工艺

         

	US
    4,023,280	Valve
                                         for Ash Agglomerating Device

         

        灰熔聚设备阀

         

	US
    4,191,539	Improved
                                         Apparatus for Feeding Caking Coals to a Gasifier

         

        气化炉粘结性煤进料的装置改进

         

	US
    4,202,673	Coal
                                         Conversion Apparatus

         

        一种煤转换装置

         

	US
    4,229,298	Fluidized
                                         Bed Apparatus and Process

         

        流化床设备和工艺

         

 

    	A-1

    	 

    

 

	US
    24,315,758 	Process
                                         for the production of fuel gas from coal by introducing an oxygen containing gas into
                                         the bottom of the fluidized bed through a separate conduit positioned within the center
                                         of a nozzle adapted to agglomerate and withdraw the ash from the bottom of the fluidized
                                         bed.

         

        一种煤制燃料气产出工艺;氧气从中心管喷嘴进入到流化床底部;并通过这个中心管进行灰团聚和底部排渣。

         

	US
    4,369,045	Fluidized-Bed
                                         Gasification Process with Agglomerated Solids Removal

         

        一种固体团聚排渣的流化床气化工艺

         

	US
    4,416,857	Fluidized-Bed
                                         Gasifier or Similar Device for Gasification of Ash and Untreated Coal

         

        气化灰和未处理煤的流化床气化炉或类似设备

         

	US
    4,435,364	Fluidized-Bed
                                         Gasifier or Similar Device for Gasification of Ash and Untreated Char

         

        气化灰和未处理焦的流化床气化炉或类似设备

         

	US
    4,483,692	Apparatus
                                         for Fluidized Bed Coal Gasification Reactor

         

        流化床煤气化反应器装置

         

	US
    4,544,375	Method
                                         for Controlling Ash Level in Ash Agglomerating Fluidized Bed Gasifier

         

        控制灰熔聚流化床气化炉中灰水平的方法

         

 

    	 

    	 

    

 

	US
    4,664,678	Apparatus
                                         and Process for Controlling Fluidized Beds

         

        控制流化床的设备和工艺

         

	US
    4,867,756	Removal
                                         of Sulfur Compounds in Fluidized bed Carbonaceous Solids Gasification

         

        去除流化床含碳固体气化中的硫化物

         

 

	

    Invention 1

    发明1 

    
	Dust
    Removal Method Using Baghouse Filters And Dust Removal Apparatus Therefor    干法布袋除尘装置

    Inventors: Minghai Gu, Songliang Sun, Guangliang Luo  发明人;顾明海;孙松良;
    骆光亮
	(I)
                                         PCT/CN2009/000578 entered following countries已于下列国家申请专利
                                         

        Filing Date: 26-May-2009
        备案日期;2009年5月26日

	Australia澳大利亚	China中国	India印度	Indonesia印度尼西亚	US美国	Vietnam越南	Turkey土耳其
	App.
    No. 申请号 2009253633	App.
    No. 申请号 200980120579.2	App.
    No. 申请号 9234/DELNP/2010	App.
    No. 申请号 W00201004464	App.
    No. 申请号 12/994,850	App.
    No. 申请号 1-2010-03530	App.
    No. 申请号 2010/11132

Pat.
    No. TR 2010 11132 B
	All
    pending等待结果	Issued已授权
	(II)
                                         Chinese utiltiy model中国实用新型
                                         200820119811.3: Issued已授权

        Filing Date: 27-May-2008
        备案日期;2008年5月27日

 

    	 

    	 

    

 

	Invention 2

    发明2 

    
	HRSG
    For Use With Fluidized Coal Gasifier   一种流化床煤气化用余热锅炉                                                                                                                                    Inventors:
    Minghai Gu, Songliang Sun, Guangliang Luo  发明人;顾明海;孙松良;
    骆光亮
	(I)
                                         PCT/CN2009/000579: entered following countries 已于下列国家申请专利
                                         

        Filing Date: 26-May-2009
        备案日期;2009年5月26日

	Australia澳大利亚	China中国	India印度	Indonesia印度尼西亚	US美国	Vietnam越南	Turkey土耳其
	App.
    No. 申请号 2009253634	App.
    No. 申请号 200980120578.8

Pat
    No.专利号 ZL 200980120578.8	App.
    No. 申请号 9240/DELNP/2010	App.
    No. 申请号 W00201004463	App.
    No. 申请号 12/994,851	App.
    No. 申请号 1-2010-03531	App.
    No. 申请号 2010/10838

Pat
    No.专利号 TR 2010 10838 B
	Pending等待结果	Issued已授权	All
    Pending等待结果	Issued已授权
	(II)
                                         Chinese utiltiy model 中国实用新型
                                         App. No. 申请号
                                         200820119812.8: issued 已授权
                                         (CN201272780Y)

        Filing Date: 26-May-2008
        备案日期;2008年5月26日

	Invention
    3

    发明3

    
	Fluidized
                                         bed gasifier with solids discharge and classification device 具有固体颗粒排放及分类装置的流化床反应器
                                         

        Inventors: Tsung-Yao
        Robert Sheng 发明人;盛宗耀

	(I)
    PCT/US2009/046336: entered following countries  已于下列国家申请专利

Filing
    Date: 05-Jun-2009 备案日期;2009年6月5日

 

    	 

    	 

    

 

	Australia澳大利亚	China中国	India印度	Indonesia印度尼西亚	US美国	Vietnam越南	Turkey土耳其
	App.
    No. 申请号 2009256101	App.
    No. 申请号 200980121529.6 	App.
    No. 申请号 9233/DELNP/2010	App.
    No. 申请号 W00201004533	App.
    No. 申请号 12/996,017	App.
    No. 申请号 1-2011-00025	App.
    No. 申请号 2010/10131                    Pat
    No.专利号 TR 2010 10131 B
	All
    pending等待结果	Issued已授权
	Invention
    4

    发明4	Method
    and Apparatus for Fine Solids Recycle   细微固体颗粒回收利用装置及包括其的流化床反应器

    Inventors: Guohai Liu  发明人;刘国海
	(I)
    US App. No. 申请号12/111,767

Pat
    No.专利号 US 7,879,294 B2: Issued已授权

Filing
    Date: 29-April-2008 备案日期;2008年4月29日
	(II)
CN App. No. 中国申请号 200910203552.1:
Pending  等待结果

Filing Date: 20-May-2009
备案日期;2009年5月20日
	Invention
    5

    发明5

    
	Loop
    Seal for Recycling Solids from a Cyclone and Fluidized Bed Reactor and Method Using the Same   用于回收利用旋风分离器中固体颗粒的回料阀以及流化床反应器和其使用方法

    Inventors: Guohai Liu 发明人;刘国海
	(I)
PCT/US2010/037558: entered following countries   已于下列国家申请专利

Filing
Date: 05-Jun-2010 备案日期;2010年6月5日

 

    	 

    	 

    

 

	Australia澳大利亚	China中国	India印度	Indonesia印度尼西亚	Vietnam越南	US美国	Turkey土耳其
	App.
    No. 申请号 2010256358	App.
    No. 申请号 201080025126.4	App.
    No. 申请号 9720/DELNP/2011	App.
    No. 申请号 W00201104449	App.
    No. 申请号 1-2012-00036	App.
    No. 申请号 13/376,291	App.
    No. 申请号 A 2011/11917

    Pat No.专利号 TR 2011 11917 B
	All
    pending等待结果	Issued已授权
	Invention
    6

    发明6

    
	Method
    and Apparatus for Cooling Solid Particles Under High Temperature and Pressure  在高温高压下冷却固体颗粒的方法及装置

    Inventors: Guohai Liu 发明人;刘国海
	(I)
    PCT/US2009/046335: entered following countries   已于下列国家申请专利

Filing
    Date: 05-Jun-2009 备案日期;2010年6月5日
	Australia澳大利亚	China中国	India印度	Indonesia印度尼西亚	Vietnam越南	Turkey土耳其
	App.
    No. 申请号 2009256100	App.
    No. 申请号 200980121542.1	App.
    No. 申请号 9232/DELNP/2010	App.
    No. 申请号 W00201004534	App.
    No. 申请号 1-2011-00026	App.
    No. 申请号 2010/10132
	All
    Pending等待结果
	(II)
    US App. No. 美国申请号 12/133,759:
    Pending   等待结果

Filing
    Date: 05-Jun-2008  备案日期;2008年6月5日

 

    	 

    	 

    

 

	Invention 7

    发明7	Method
    and apparatus for particle recycling in multiphase chemical reactors  回收利用多相化学反应器中颗粒的方法及装置

    Inventors: Michael Xu 发明人;徐春发
	(I)
    PCT/US2011/062273: entered following countries     已于下列国家申请专利

Filing
    Date: 29-Nov-2011 备案日期;2010年6月5日
	Australia澳大利亚	India印度	Indonesia印度尼西亚	US美国
	App.
    No. 申请号 2011336788	App.
    No. 申请号 5059/DELNP/2013	App.
    No. 申请号 W00201302922	App.
    No. 申请号 13/990,042
	All
    Pending等待结果
	(II)
    CN App. No. 中国申请号 201010582393.3:
    Pending   等待结果

Filing
    Date: 29-Nov-2010  备案日期;2010年11月29日
	Invention
    8

    发明8

    
	Fines
    Capture and Recycle System and Uses Thereof (one cyclones/dipleg system)      细粉捕集和循环系统及其使用原理;一个旋风/料腿系统;

    Inventors: Francis Lau;Tsung-Yao Robert SHENG  发明人;刘锡明;盛宗耀
	(I)
    PCT/US2012/044094: National stage due on 24-December-2013    PCT进入各国的有效期为2013年12月24日

Filing
    Date: 25-Jun-2012  备案日期;2012年6月25日
	(II)
    US App. No. 美国申请号 13/532,769:
    Pending   等待结果

Filing
    Date: 25-Jun-2012  备案日期;2012年6月25日
	 	 	 	 	 

 

    	 

    	 

    

 

	Invention 9

    发明9

    
	Fluidized
    Beds Having Membrane Walls and Methods for Fluidizing    包含有膜式壁的流化床以及流化方法

Inventors:
    Timothy E. Vail  发明人;Timothy
    E. Vail
	(I)
    PCT/US2010/041758: National stage due on 13-January-2013, according to Francis emai dated 9 January 2013, not enter into national
    stage  PCT进入各国的有效期为2013年1月13日;根据Francis
    2013年1月9日的邮件;未在其他国家申请

    Filing Date: 13-Jul-2010  备案日期;2010年7月13日
	(II)
    US  App. No. 美国申请号12/416,006:
    Pending    等待结果

Filing
    Date: 31-March-2009  备案日期;2009年3月31日
	Invention
    10

    发明10	Synthetic
Gas Recycle Method and Apparatus       一种合成气循环的装置及方法

Inventors:
Mark K. Robertson & Gwo-Jang Abraham Liou   发明人;Mark K. Robertson 和 Gwo-Jang
Abraham Liou
	(I)
    PCT/US2010/048947: due date to national stage entry lapsed     PCT未在各国申请

Filing
    Date: 15-Sep-2010  备案日期;2010年9月15日
	(II)
US  App. No. 美国申请号12/563,800:
Abandoned    放弃

Filing Date: 15-Sep-2009  备案日期;2010年9月15日
	Invention
    11

    发明11	Fluidized
    beds, sizing of fluidizing medium inlet holes and methods of fluidizing     流化床,
    流化介质进入孔尺寸以及流化方法
     

Inventors:
    David H. Nicoll, Timothy E. Vail  发明人;David
    H. Nicoll, Timothy E. Vail
	(I)
    PCT/US2008/076089: entered following countries     已于下列国家申请专利

Filing
    Date: 11-Sep-2008  备案日期;2008年9月11日
	Australia澳大利亚	China中国	Europe欧洲	India印度
	 	 	 	 	 

 

    	 

    	 

    

 

	App.
    No. 申请号 2008298732	App.
    No. 申请号 200880115584.X

Pat
    No.专利号 ZL 200880115584.X 	App.
    No. 申请号 08831249.1

Pat
    No.专利号 2200738	No
    Published information无信息发布
	Pending等待结果	Issued
    已授权	Issued
    已授权	Pending等待结果
	(II)
    US App. No. 美国申请号11/853,933:
    Pending 等待结果

Filing
    Date: 12-Sep-2007  备案日期;2007年9月12日
	Invention
    12

    发明12	Venturi
inserts, interchangeable venturis and methods of fluidizing    文丘里管插件、可替换的文丘里管和流化的方法

Inventors:
David H. Nicoll, Timothy E. Vail  发明人;David H. Nicoll, Timothy E. Vail
	(I)
    PCT/US2008/076090: entered following countries  已于下列国家申请专利

Filing
    Date: 11-Sep-2008  备案日期;2008年9月11日
	Australia澳大利亚	China中国	Europe欧洲	India印度
	Mr.
    John Winter instructed to abandon these applications. John Winter先生指示放弃这些申请。
	(II)
    US App. No. 美国申请号11/853,934:
    Mr. John Winter instructed to abandon this application   John Winter先生指示放弃这些申请。

Filing
    Date: 11-Sep-2007   备案日期;2007年9月11日
	Invention
    13

    发明13	***
	***
	 	 	 	 	 

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	 

    	 

    

 

	Invention
    14 

    发明14	***
	***
	Invention
    15 

    发明15	***
	***
	Invention
    16 

    发明16	***
	***
	Invention
    17 

    发明17	***
	***
	Invention
    18 

    发明18	***
	***
	Invention
    19

    发明19	***

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	 

    	 

    

 

	***

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act of 1934, as amended, and has been
filed separately with the Securities and Exchange Commission.

 

    	 

    	 

    

 

Annex B Marks

附件B

标识

 

		1.	SES标志
                                         SES Marks

 

		1.1	英文标志
                                         English

 

 

		1.2	中文标志
                                         Chinese

 

 

		2.	SES标语
                                         SES Slogan

 

		2.1	Unlocking
                                         value through clean energy technology.

 

		2.2	清洁能源技术创造价值。

 

		2.3	褐煤和生物质气化的领导者。

 

    	B-1

    	 

    

 

		3.	SES
                                         Gasification Technology Name

 

		a)	SES Gasification Technology

 

		b)	SES气化技术

 

		4.	U-GAS商标

 

		3.1	U-GAS®

 

		5.	张化机商标
                                         ZCM Marks

 

 

    	 

    	 

    

 

Annex C

 

Project Pipeline
of SESHK and/or Its Affiliates

(before the
Effective Date and within the Territory)

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Royalty
    fee	 	Proprietary
    equipment	 	 	 	 	 	 	 	 
	No.	 	Company
    Name	 	Priority	 	Country	 	Project	 	Capacity	 	Estimated

        project
        start

        year
	 	Technical

        proposal
	 	Net

        Syngas

        scale*

        (ncm/hr)
	 	Unit

        Price

        (US

        dollar)
	 	Royalty
                                         fee

        (RMB)
	 	Cost
    (RMB)	 	Margin
    (RMB)	 	20%
                                         Margin

        (RMB)
	 	Quotation

        (RMB)
	 	PDP
                                         Fee

        (RMB)
	 	Technical

        Service
        (RMB)
	 	Gasifier

        number
	 	Remarks
	1	 	***	 	High	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 	 	 	 	 	 	 
	2	 	***	 	High	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 
	3	 	***	 	High	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	4	 	***	 	High	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	5	 	***	 	Medium	 	China	 	***	 	***	 	 	 	N	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	6	 	***	 	Medium	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	***	 	***	 	***	 	***
	7	 	***	 	Medium	 	China	 	***	 	***	 	***	 	N	 	***	 	 	 	-   	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	8	 	***	 	Medium	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 
	9	 	***	 	Medium	 	China	 	***	 	***	 	 	 	Y	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	10	 	***	 	Medium	 	China	 	***	 	***	 	***	 	N	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	11	 	***	 	Medium	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 	 	 
	12	 	***	 	Medium	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 	 	 
	13	 	***	 	Medium	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	***	 	 	 	***	 	 	 	***	 	 	 	***	 	 	 	***
	14	 	***	 	Medium	 	China	 	***	 	***	 	 	 	N	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	15	 	***	 	Medium	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 
	16	 	***	 	Medium	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 
	17	 	***	 	Medium	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	***	 	 

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	C-1

    	 

    

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Royalty
    fee	 	Proprietary
    equipment	 	 	 	 	 	 	 	 
	No.	 	Company
    Name	 	Priority	 	Country	 	Project	 	Capacity	 	Estimated

        project
        start

        year
	 	Technical

        proposal
	 	Net

        Syngas

        scale*

        (ncm/hr)
	 	Unit

        Price

        (US

        dollar)
	 	Royalty
                                         fee

        (RMB)
	 	Cost
    (RMB)	 	Margin
    (RMB)	 	20%
                                         Margin

        (RMB)
	 	Quotation

        (RMB)
	 	PDP
                                         Fee

        (RMB)
	 	Technical

        Service
        (RMB)
	 	Gasifier

        number
	 	Remarks
	18	 	***	 	Medium	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	 
	19	 	***	 	Medium	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 
	20	 	***	 	Medium	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	 	 	 
	21	 	***	 	Low	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	22	 	***	 	Low	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 	 	 
	23	 	***	 	Low	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	 	 	 
	24	 	***	 	Low	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	25	 	***	 	Low	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	 	 	***
	26	 	***	 	Low	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***
	27	 	***	 	Low	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 
	28	 	***	 	Low	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	***	 	 	 	***	 	 	 	 	 	 	 	 	 	 	 	***
	29	 	***	 	Low	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	***	 	 	 	***	 	***	 	***	 	***	 	 
	30	 	***	 	Low	 	China	 	***	 	***	 	***	 	N	 	***	 	***	 	***	 	***	 	***	 	 	 	***	 	***	 	***	 	 	 	***
	31	 	***	 	Low	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	 	 	***	 	***	 	***	 	 	 	 
	32	 	***	 	Low	 	China	 	***	 	***	 	***	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***
	33	 	***	 	Low	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	***	 	 
	34	 	***	 	Low	 	China	 	***	 	***	 	 	 	N	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	 	 	 

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	C-2

    	 

    

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Royalty
    fee	 	Proprietary
    equipment	 	 	 	 	 	 	 	 
	No.	 	Company
    Name	 	Priority	 	Country	 	Project	 	Capacity	 	Estimated

        project
        start

        year
	 	Technical

        proposal
	 	Net

        Syngas

        scale*

        (ncm/hr)
	 	Unit

        Price

        (US

        dollar)
	 	Royalty
                                         fee

        (RMB)
	 	Cost
    (RMB)	 	Margin
    (RMB)	 	20%
                                         Margin

        (RMB)
	 	Quotation

        (RMB)
	 	PDP
                                         Fee

        (RMB)
	 	Technical

        Service
        (RMB)
	 	Gasifier

        number
	 	Remarks
	35	 	***	 	Low	 	China	 	***	 	***	 	 	 	N	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	 	 	 
	36	 	***	 	Low	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	 	 	 	 	***	 	***	 	***	 	 	 	***
	37	 	***	 	Low	 	China	 	***	 	***	 	 	 	Y	 	***	 	***	 	***	 	***	 	 	 	***	 	***	 	***	 	***	 	***	 	 
	38	 	***	 	Low	 	Indonesia	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	39	 	***	 	Medium	 	Indonesia	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	40	 	***	 	Low	 	Phillipines	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	41	 	***	 	high	 	***	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	42	 	***	 	high	 	***	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	43	 	***	 	High	 	***	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	44	 	***	 	High	 	***	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	C-3

    	 

    

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Royalty
    fee	 	Proprietary
    equipment	 	 	 	 	 	 	 	 
	No.	 	Company
    Name	 	Priority	 	Country	 	Project	 	Capacity	 	Estimated

        project
        start

        year
	 	Technical

        proposal
	 	Net

        Syngas

        scale*

        (ncm/hr)
	 	Unit

        Price

        (US

        dollar)
	 	Royalty
                                         fee

        (RMB)
	 	Cost
    (RMB)	 	Margin
    (RMB)	 	20%
                                         Margin

        (RMB)
	 	Quotation

        (RMB)
	 	PDP
                                         Fee

        (RMB)
	 	Technical

        Service
        (RMB)
	 	Gasifier

        number
	 	Remarks
	45	 	***	 	High	 	***	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***
	46	 	***	 	High	 	***	 	***	 	***	 	***	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	***

 

***
This information has been omitted in reliance upon Rule 24b-2 under the Securities Exchange Act
of 1934, as amended, and has been filed separately with the Securities and Exchange Commission.

 

    	C-4

    	 

    

 

Annex D

Form of Technical
Non-disclosure Agreement

 

Agreement made
this [DATE]

 

Between Synthesis
Energy Systems, Inc. (“SES”) and

 

[COUNTERPARTY]
(“Recipient”)

 

SES
has developed, licensed or otherwise acquired proprietary technical information relating to coal gasification technology, biomass
and blends of coal and biomass, for the manufacture of synthesis gas in a proprietary process and its integration with adjacent
technologies for: (1) the production of clean synthesis gas, (2) the production of hydrogen, (3) the production of chemicals,
(4) the production of transportation fuels, and (5) the production of electric power, (6) coal preparation and feeding, (7) ash
discharge (8) particulate recycling, control and removal, and (9) enhanced methanol production (the “SES Technology”).

 

Recipient
desires to obtain from SES sufficient technical information for the purpose of enabling Recipient to collaborate with SES,
evaluate such collaboration, provide technical services or technical support services to SES, or enter into any business or technical
relationships with SES (the “Purpose”).

 

SES is willing
to make available to Recipient such of SES's technical information as in SES’s opinion will be useful to Recipient for the
Purpose, on the basis set forth in this letter agreement (this “Agreement”).

 

In consideration
for the mutual covenants contained herein and the other good and valuable consideration to be provided hereunder, the parties
hereby agree as follows:

 

1.          For
purposes of this Agreement, “SES Confidential Information” means any and all technical or other information
disclosed to or obtained by Recipient (including, without limitation, all information comprising or relating to the SES Technology),
directly or indirectly, by SES or its affiliates under this Agreement, whether disclosed orally, in writing, visually or electronically.
SES Confidential Information shall also include any such information that is or may be combined with any other information by
Recipient and any evaluations thereof prepared by or on behalf of Recipient. Notwithstanding the foregoing, SES Confidential Information
shall not include any information

 

(1)
that is or hereafter becomes, through no fault of Recipient, generally available to the public or otherwise a part of the public
domain by publication or otherwise;

 

(2)
that Recipient can demonstrate was received by it from a third party having the right to disclose the same without any restriction
on disclosure and who did not receive it directly or indirectly from SES, its parent, affiliates or their successors in interest
in violation of any confidentiality obligation to SES or any of them ; or

 

(3)
that Recipient can demonstrate was already lawfully in its possession at the time of receipt from SES or hereafter developed by
Recipient's employees who did not have access or recourse to any SES Confidential Information;

 

    	 

    	 

    

 

provided
that information disclosed under or as a result of this Agreement shall not be deemed to be within the foregoing exceptions merely
because such information is embraced by more general information in the public domain or in the possession of Recipient, nor will
a combination of features be deemed within the foregoing exceptions merely because individual features are in the public domain
or in Recipient’s possession unless the combination itself is in the public domain or in Recipient’s possession.

 

2.          Recipient
will not itself, nor will it permit any other person, to publish, copy or reproduce in any form or manner, nor disclose the SES
Confidential Information, in whole or in part, directly or indirectly, to any third party (including without limitation to any
contractor, affiliate, agent, government agency, or customer) without the prior written consent of SES. Recipient agrees that
Recipient will limit access to SES Confidential Information to only those employees of the Recipient who are needed for the Purpose
and who have undertaken obligations of confidentiality and limited use no less restrictive than those set forth in this Agreement,
and provided that Recipient will advise each such person of the confidential nature of SES Confidential Information and of the
obligations of this Agreement. Recipient will be responsible for any breach of the terms of this Agreement by any person receiving
SES Confidential Information directly or indirectly from Recipient.

 

3.          Recipient
will employ at least the same degree of care in protecting the SES Confidential Information as it employs in protecting its own
confidential information of similar import, but not less than a reasonable degree of care. Without limiting the foregoing, Recipient
will not copy any SES Confidential Information, except as may be required for the Purpose, and will store such SES Confidential
Information in a secure place.

 

4.          Recipient
agrees that Recipient will not directly or indirectly use or permit the use of the SES Confidential Information for any purpose
other than the Purpose.

 

5.          In
the event that Recipient receives an order to disclose all or any part of the SES Confidential Information under the terms of
a subpoena or order issued by a court or by a governmental body, Recipient agrees (1) to notify SES immediately of the existence,
terms, and circumstances surrounding such order, (2) to consult with SES on the advisability of taking legally-available steps
to resist or narrow such order, (3) cooperate with any legally-available steps taken by SES to resist or narrow such order, and
(4) if disclosure of such SES Confidential Information is required to prevent Recipient from being held in contempt or subject
to other penalty, to furnish only such portion of the SES Confidential Information as, in the written opinion of Recipient’s
counsel, it is legally compelled to disclose, and (5) to exercise its best reasonable efforts to obtain an order or other reliable
assurance from such court of governmental body that confidential treatment will be accorded to the SES Confidential Information.

 

6.          At
SES’s request and in any event upon termination of this Agreement, Recipient shall return or procure the return to SES of
all documents and materials furnished to it by SES incorporating any SES Confidential Information and shall destroy all copies
or other documents and materials that contain, reflect or are derived from SES Confidential Information, whether the same be in
the possession of Recipient or of any person who has received the SES Confidential Information from the Recipient.

 

7.          Recipient
agrees to disclose promptly to SES any inventions, improvements or derivatives which are conceived by any employee of Recipient
or by any third party recipient of SES Confidential Information from Recipient, and which are based on any SES Confidential Information.
Recipient grants to SES (and shall procure the grant from any such third party if required of) an exclusive, worldwide, irrevocable,
royalty-free license and licensing right to any and all such inventions, improvements and derivatives, whether patentable or not,
all without accounting to Recipient or any other party.

 

    	 

    	 

    

 

8.          Nothing
contained herein shall be construed as granting Recipient or any other party a license under any patent, trade secret or other
rights of SES or its affiliates relating to SES Confidential Information or any SES intellectual property. Nothing in this Agreement
shall be deemed a commitment by either party to enter into any license or further agreement. Recipient undertakes not to create,
use, register or seek to register any mark, domain name, copyright material, patent, design, trade name or trade dress which incorporates
or is confusingly similar to any SES Confidential Information or SES intellectual property.

 

9.          Recipient
acknowledges and agrees that money damages would be an inadequate remedy for its breach of this Agreement because of the difficulty
of ascertaining the amount of damages that would be suffered by SES in connection therewith. Therefore, Recipient agrees that
SES shall be entitled to equitable relief, including injunction and specific performance, in the event of any breach or threatened
breach of the provisions of this Agreement by Recipient, in addition to all other remedies available to SES at law or in equity.

 

10.          This
Agreement constitutes the entire agreement between the parties and supersede and cancel all prior negotiations, understandings
and agreements between the parties, whether oral or written, regarding the subject matter of this Agreement or thereof. This Agreement
can be amended only by written document signed by both parties which expressly states that it is to be an amendment of this Agreement.
If any provision of this Agreement is declared void or otherwise unenforceable, such provision shall be deemed severed from this
Agreement, which shall otherwise remain in full force and effect.

 

11.          This
Agreement shall come into effect on the day first written above and shall continue in full force until terminated at any time
by either party by providing written notice of such termination to the other party. Termination of this Agreement shall not relieve
the Recipient of any obligation hereunder with respect to SES Confidential Information disclosed to Recipient prior to such termination
and the restrictions set forth in this Agreement shall remain in full force unless and until such SES Confidential Information
ceases to be SES Confidential Information under Paragraph 1 of this Agreement.

 

12.          The
provisions of this Agreement will be for the benefit of and binding upon each of the parties, and their respective successors
and assigns, and will be governed by and construed in accordance with the laws of England without regard to its conflict of law
rules.

 

13.          (1)
All disputes arising out of or in connection with this Agreement shall be submitted to the International Court of Arbitration
of the International Chamber of Commerce and shall be finally settled under the Rules of Arbitration of the International Chamber
of Commerce (the "Rules").

 

(2)
Arbitration shall be conducted using the English language. The place of the Arbitration shall be [Singapore].

 

(3)
There shall be three (3) arbitrators. Each party shall appoint one arbitrator, and the third and presiding arbitrator shall be
selected by agreement between the parties, or failing agreement within twenty (20) days of the appointment of the two party-nominated
arbitrators, in accordance with the said Rules. The presiding arbitrator shall not be a national of China, Hong Kong, Macau, Taiwan
or the USA.

 

    	 

    	 

    

 

14.          Nothing
in this Agreement shall prevent SES from applying for injunctive relief on the grounds of misuse or threatened misuse of SES Confidential
Information or infringement, or threatened infringement of SES's intellectual property.

 

IN
WITNESS WHEREOF, an authorized representative of each respective party has executed this Agreement on the date first written above.

 

SES: SYNTHESIS
ENERGY SYSTEMS, INC.

 

	By:
    	 	 
	Name:	 
	Title:	 

 

	RECIPIENT: 	 	 

 

	By:	 	 
	Print Name:	 
	Print Title:

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