ADA-ES INC (Form: 10-Q, Received: 08/12/2011 14:28:39)

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

United States

Securities and Exchange Commission

Washington, D.C. 20549

FORM 10-Q

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2011

¨	TRANSITION REPORT PURSUANT TO 13 OR 15(d) OF THE EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 000-50216

ADA-ES, INC.

(Exact name of registrant as specified in its charter)


Colorado		84-1457385
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

8100 SouthPark Way, B, Littleton, Colorado		80120
(Address of principal executive offices)		(Zip Code)

(303) 734-1727

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act. (Check one): Yes ¨ No x

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes ¨ No ¨

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.


Class		Outstanding at July 31, 2011
Common Stock, no par value		7,659,382

PART I - FINANCIAL INFORMATION

Item 1.

Consolidated Financial Statements.

ADA-ES, Inc. and Subsidiaries

Consolidated Balance Sheets

( Amounts in thousands, except share data )


	June 30, 2011			December 31, 2010
	(Unaudited)
ASSETS
C URRENT A SSETS :
Cash and cash equivalents	$	41,023		$	9,696
Receivables, net of allowance for doubtful accounts		6,676			9,066
Investment in securities		505			505
Notes receivable		—			1,580
Prepaid expenses and other		1,092			603

Total current assets		49,296			21,450


P ROPERTY AND E QUIPMENT , at cost		9,269			8,041
Less accumulated depreciation and amortization		(3,631	)		(3,235	)

Net property and equipment		5,638			4,806


G OODWILL , net of amortization		435			435
I NTANGIBLE A SSETS , net of amortization		326			260
I NVESTMENT IN U NCONSOLIDATED E NTITIES		10,310			14,021
D EFERRED T AXES AND O THER A SSETS		25,117			15,696

T OTAL A SSETS	$	91,122		$	56,668


LIABILITIES AND STOCKHOLDERS’ EQUITY
C URRENT L IABILITIES :
Accounts payable	$	4,017		$	3,646
Accrued payroll and related liabilities		3,168			1,852
Draws made under line of credit		4,168			—
Deferred revenues		4,951			5,639
Accrued expenses and other liabilities		1,011			244
Accrued arbitration award and related liability		32,569			—

Total current liabilities		49,884			11,381


L ONG - TERM L IABILITIES :
Accrued indemnity		29,118			27,411
Accrued warranty and other liabilities		2,428			4,432
Accrued arbitration award		6,933			—

Total long-term liabilities		38,479			31,843

Total liabilities		88,363			43,224


C OMMITMENTS AND C ONTINGENCIES (Note 9)

S TOCKHOLDERS ’ E QUITY :
ADA-ES, Inc. stockholders’ equity Preferred stock: 50,000,000 shares authorized, none outstanding		—			—
Common stock: no par value, 50,000,000 shares authorized, 7,632,540 and 7,538,861 shares issued and outstanding, respectively		59,348			39,627
Accumulated deficit		(58,011	)		(28,218	)

Total ADA-ES, Inc. stockholders’ equity		1,337			11,409
Non-controlling interest		1,422			2,035

T OTAL S TOCKHOLDERS ’ E QUITY		2,759			13,444

T OTAL L IABILITIES AND S TOCKHOLDERS ’ E QUITY	$	91,122		$	56,668

See accompanying notes.

ADA-ES, Inc. and Subsidiaries

Consolidated Statements of Operations

( Amounts in thousands, except per share data )

(Unaudited)


	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
R EVENUE :
Emission control	$	1,709		$	1,600		$	3,742		$	4,664
CO ₂ capture		569			337			917			1,140
Refined coal		4,748			—			10,834			—

Total revenues		7,026			1,937			15,493			5,804

C OST OF R EVENUES :
Emission control		962			1,199			1,798			3,021
CO ₂ capture		476			144			759			408
Refined coal		413			586			588			1,012

Total cost of revenues		1,851			1,929			3,145			4,441


G ROSS M ARGIN		5,175			8			12,348			1,363

O THER C OSTS AND E XPENSES :
General and administrative		6,847			6,176			11,664			10,755
Research and development		375			197			696			381
Depreciation and amortization		207			330			392			539

Total expenses		7,429			6,703			12,752			11,675


O PERATING L OSS		(2,254	)		(6,695	)		(404	)		(10,312	)

O THER I NCOME (E XPENSE ):
Net equity in net income (loss) from unconsolidated entities		(1,752	)		(1,568	)		(3,711	)		(2,750	)
Other income including interest		1,498			1,791			2,090			1,811
Arbitration award		—			—			(39,502	)		—

Total other income (expense)		(254	)		223			(41,123	)		(939	)


L OSS FROM C ONTINUING O PERATIONS B EFORE I NCOME T AX B ENEFIT AND N ON - CONTROLLING I NTEREST		(2,508	)		(6,472	)		(41,527	)		(11,251	)

I NCOME T AX B ENEFIT		2,313			2,087			16,569			3,700


N ET L OSS B EFORE N ON - CONTROLLING I NTEREST		(195	)		(4,385	)		(24,958	)		(7,551	)

N ON - CONTROLLING I NTEREST		(2,056	)		675			(4,835	)		1,021


N ET L OSS A TTRIBUTABLE TO ADA-ES, I NC .	$	(2,251	)	$	(3,710	)	$	(29,793	)	$	(6,530	)


N ET L OSS P ER C OMMON S HARE – B ASIC AND D ILUTED A TTRIBUTABLE TO ADA-ES, I NC .	$	(0.30	)	$	(0.50	)	$	(3.91	)	$	(0.89	)


W EIGHTED A VERAGE C OMMON S HARES O UTSTANDING		7,601			7,412			7,618			7,305

W EIGHTED A VERAGE D ILUTED C OMMON S HARES O UTSTANDING		7,601			7,412			7,618			7,305

See accompanying notes.

ADA-ES, Inc. and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity (Deficit)

Six Months Ended June 30, 2011 and 2010

(Amounts in thousands, except share data)

(Unaudited)


	C OMMON S TOCK					(A CCUMULATED			T OTAL ADA-ES S TOCKHOLDERS ’			N ON - C ONTROLLING			T OTAL
	S HARES		A MOUNT			D EFICIT )			E QUITY			I NTEREST			E QUITY
B ALANCES , January 1, 2010		7,093,931	$	37,000		$	(12,748	)	$	24,252		$	99		$	24,351
Stock-based compensation		189,859		805			—			805			—			805
Issuance of stock to 401(k) plan		22,297		140			—			140			—			140
Issuance of stock for cash		143,885		1,000			—			1,000			—			1,000
Issuance of stock on exercise of options		2,250		6			—			6			—			6
Equity contributions by non-controlling interest		—		—			—			—			1,535			1,535
Distributions to non-controlling interest		—		—			—			—			(2,793	)		(2,793	)
Expense of stock issuance and registration		—		(21	)		—			(21	)		—			(21	)
Net loss		—		—			(6,530	)		(6,530	)		(1,021	)		(7,551	)

B ALANCES , June 30, 2010		7,452,222	$	38,930		$	(19,278	)	$	19,652		$	(2,180	)	$	17,472


B ALANCES , January 1, 2011		7,538,861	$	39,627		$	(28,218	)	$	11,409		$	2,035		$	13,444
Stock-based compensation		66,269		454			—			454			—			454
Issuance of stock to 401(k) plan		16,276		182			—			182			—			182
Issuance of stock on exercise of options		11,134		81			—			81			—			81
Equity contribution from sale of interest in joint venture, net of income taxes		—		19,020			—			19,020			—			19,020
Equity contributions by non-controlling interest		—		—			—			—			250			250
Distributions to non-controlling interest		—		—			—			—			(5,698	)		(5,698	)
Expense of stock issuance and registration		—		(16	)		—			(16	)		—			(16	)
Net income (loss)		—		—			(29,793	)		(29,793	)		4,835			(24,958	)

B ALANCES , June 30, 2011		7,632,540	$	59,348		$	(58,011	)	$	1,337		$	1,422		$	2,759

See accompanying notes.

ADA-ES, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(Amounts in thousands)

(Unaudited)


	Six Months Ended June 30,
	2011			2010
C ASH F LOWS FROM O PERATING A CTIVITIES :
Net loss	$	(29,793	)	$	(6,530	)
Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization		392			555
Deferred tax benefit		(16,569	)		(3,700	)
Loss on disposal of assets		37			—
Expenses paid with stock, restricted stock and stock options		636			532
Net equity in net loss from unconsolidated entities		3,711			2,750
Non-cash gain from joint venture partner		—			(1,768	)
Non-controlling interest in income (loss) from subsidiaries		4,835			(1,021	)
Changes in operating assets and liabilities:
Receivables, net		2,390			2,928
Prepaid expenses and other		(674	)		619
Accounts payable		371			592
Accrued payroll, expenses and other related liabilities		3,586			4,858
Deferred revenues		(2,488	)		9,262
Accrued arbitration award and indemnity obligation		39,502			—

Net cash provided by operating activities		5,936			9,077

C ASH F LOWS FROM I NVESTING A CTIVITIES :
Investment in securities		—			(105	)
Principal payments received on notes receivable		1,580			—
Equity contribution from sale of interest in joint venture		30,000			—
Capital expenditures for equipment, patents and development projects		(4,974	)		(2,829	)
Cash paid for equity contributions to unconsolidated entity		—			(283	)

Net cash provided by (used in) investing activities		26,606			(3,217	)

C ASH F LOWS FROM F INANCING A CTIVITIES :
Net borrowings under line of credit		4,168			—
Non-controlling interest equity contributions		250			1,535
Distributions to non-controlling interest		(5,698	)		(2,793	)
Exercise of stock options		81			6
Issuance of common stock		—			1,000
Stock issuance and registration costs		(16	)		(21	)

Net cash used in financing activities		(1,215	)		(273	)

I NCREASE IN C ASH AND C ASH E QUIVALENTS		31,327			5,587
C ASH AND C ASH E QUIVALENTS , beginning of period		9,696			1,456

C ASH AND C ASH E QUIVALENTS , end of period	$	41,023		$	7,043


S UPPLEMENTAL S CHEDULE OF N ON -C ASH F LOW F INANCING A CTIVITIES :
Stock and stock options issued for services	$	636		$	945

See accompanying notes.

ADA-ES, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

June 30, 2011

(1)

Basis of Presentation

ADA-ES, Inc. (“ADA”), its wholly-owned subsidiary, ADA Environmental Solutions, LLC (“ADA LLC”) and ADA’s joint venture interest in Clean Coal Solutions, LLC (“Clean Coal”) are collectively referred to as the “Company”. The Company is principally engaged in providing environmental technologies and specialty chemicals to the coal-burning electric power generation industry. The Company generates a substantial part of its revenue from the sale of Activated Carbon Injection (“ACI”) systems, contracts co-funded by the government and industry and development and lease of equipment for the refined coal (“RC”) market. The Company’s sales occur principally throughout the United States.

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial statements and with the instructions to Form 10-Q and Article 10 of Regulation S-X and, therefore, do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. The consolidated financial statements include the financial statements of ADA, ADA LLC and Clean Coal. We have eliminated all significant intercompany balances and transactions in consolidation.

In the opinion of management, the consolidated financial statements include all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the results of operations, financial position and cash flows for the interim periods presented. Operating results for the three and six months ended June 30, 2011 are not necessarily indicative of the results that may be expected for the year ending December 31, 2011.

These statements should be read in conjunction with the consolidated financial statements and related notes to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2010. The accounting policies used in preparing these consolidated financial statements are the same as those described in our Form 10-K.

The Company prepares its consolidated financial statements in conformity with U.S. generally accepted accounting principles. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

(2)

Investments in Unconsolidated Entities

ADA Carbon Solutions, LLC

On October 1, 2008, the Company entered into a Joint Development Agreement (“JDA”), a Limited Liability Company Agreement (“LLC Agreement”), and other related agreements with Energy Capital Partners I, LP and its affiliated funds (“ECP”) and formed the joint venture known as ADA Carbon Solutions, LLC (“Carbon Solutions”) for the purposes of funding and constructing an activated carbon (“AC”) manufacturing facility in Red River Parish, Louisiana and similar projects. Carbon Solutions is principally engaged in development activities related to its AC business and selling of AC from its manufacturing facility (the “AC Facility”). Among Carbon Solutions’ various wholly-owned subsidiaries are ADA Carbon Solutions (Red River), LLC (“Red River”) and Crowfoot Supply Company, LLC (“Crowfoot Supply”).

Under the JDA and the LLC Agreement, the Company transferred the development assets and certain liabilities relating to the production, processing and supply of AC to ADA’s then wholly-owned subsidiaries Red River, Morton Environmental Products, LLC, Underwood Environmental Products, LLC and Crowfoot Supply and subsequently transferred the equity in these subsidiaries and certain contracts, goodwill and intellectual property relating to the AC supply business to Carbon Solutions as its $18.4 million initial contribution.

As of June 30, 2011, ADA owns a 22.8% interest in Carbon Solutions and ADA’s net investment of $9.8 million is being accounted for under the equity method of accounting. Accordingly, the respective share of approximately $1.8

million and $3.8 million of Carbon Solutions’ net loss for the three and six months ended June 30, 2011, respectively, has been recognized in the consolidated statement of operations and ADA’s investment in Carbon Solutions has been reduced by its respective share of such loss.

Under the terms of the JDA, the Company is required to indemnify ECP and Carbon Solutions for certain damages and expenses they have incurred with respect to the Company’s litigation with Norit Americas, Inc. (“Norit”) (See Note 9). As of June 30, 2011, the Company has recorded a liability to Carbon Solutions of approximately $30.7 million related to such damages and expenses incurred by Carbon Solutions. Approximately $1.6 million of that amount relates to royalty obligations recorded as a result of the interim award and has been classified as a current liability as a component of accrued arbitration award and related liability on the accompanying consolidated balance sheets. Approximately $29.1 million has been classified as non-current liabilities and is included in accrued indemnity on the accompanying consolidated balance sheets.

Following are summarized unaudited information as to assets, liabilities and results of operations of Carbon Solutions:


	As of June 30, 2011			As of December 31, 2010
	(In thousands)
Current assets	$	16,089		$	40,589
Property, equipment and other long term assets		363,746			325,769

Total assets	$	379,835		$	366,358

Total liabilities	$	233,662		$	214,638


	Three Months Ended June 30, 2011			Six Months Ended June 30, 2011
	(In thousands)
Net revenue	$	5,057		$	9,808
Net loss	$	(7,657	)	$	(16,661	)

Clean Coal Solutions Services

On January 20, 2010, the Company, together with NexGen Resources Corporation (“NexGen”), formed Clean Coal Solutions Services, LLC (“CCSS”) for the purpose of operating the RC facilities leased to a third party. The Company has a 50% ownership interest in CCSS (but does not control it) and the Company’s investment of approximately $501,000 as of June 30, 2011 includes its share of CCSS income since its formation and is accounted for under the equity method of accounting.

The following presents summarized unaudited information as to consolidated assets, liabilities and results of operations of CCSS. The consolidated financial statements of CCSS include the accounts of the third party which leases the RC facilities.


	As of June 30, 2011		As of December 31, 2010
	(In thousands)
Current assets	$	21,049	$	34,534
Property and equipment		79		89
Other long-term assets		37,677		17,555

Total assets	$	58,805	$	52,178

Total liabilities	$	21,916	$	33,896


	Three Months Ended June 30, 2011		Six Months Ended June 30, 2011
	(In thousands)
Net revenue	$	34,364	$	82,949
Net income – attributed to CCSS	$	146	$	199

(3)

Joint Venture Investment in Clean Coal

In November 2006, ADA licensed its RC technology on an exclusive basis to the Clean Coal joint venture, which was formed in 2006 with NexGen, to market the RC technology. Clean Coal’s primary purpose is to put into operation facilities that produce RC that qualifies for tax credits that are available under Section 45 of the Internal Revenue Code (“Section 45 tax credits”). Clean Coal qualified two facilities in 2009 for such purposes and monetized those facilities. The operating agreement of Clean Coal required NexGen and ADA to each pay 50% of the costs of operating Clean Coal and specified certain duties that both parties were obligated to perform.

In May 2011, ADA entered into a transaction in which Clean Coal sold an effective 15% interest of the equity in Clean Coal to an affiliate of The Goldman Sachs Group, Inc. (“GS”). GS’s interest has certain preferences over ADA and NexGen as to liquidation and profit distribution. GS has no further capital call requirements and does not have a voting interest. In conjunction with the closing of the purchase agreement, ADA, NexGen and GS entered into a Second Amended and Restated Operating Agreement and an Exclusive Right to Lease Agreement pursuant to which Clean Coal granted GS the exclusive right (but not the obligation) to lease facilities that will produce up to approximately 12 million tons of refined coal per year on pre-established lease terms similar to those currently in effect for Clean Coal’s two existing facilities. As a result of the transaction, ADA owns an effective 42.5% of Clean Coal. Since its inception, ADA has been considered the primary beneficiary of this joint venture and has consolidated the accounts of Clean Coal.

Following is unaudited summarized information as to assets, liabilities and results of operations of Clean Coal:


	As of June 30, 2011		As of December 31, 2010
	(In thousands)
Primary assets of Clean Coal:
Cash and cash equivalents	$	231	$	1,335
Accounts receivable, net		3,862		4,835
Property, plant and equipment, including assets under lease, net		5,817		5,066
Development costs		4,017		215

Primary liabilities of Clean Coal:
Accounts payable and accrued liabilities	$	1,472	$	362
Deferred revenue, current		3,600		3,600
Deferred revenue, long-term		1,800		3,600



	Three Months Ended June 30, 2011		Six Months Ended June 30, 2011
	(In thousands)
Net revenue	$	4,723	$	10,802
Net income	$	3,564	$	8,828

(4)

Deferred Revenues

Deferred revenues consist of:

•

billings in excess of costs and earnings on uncompleted contracts;

•

unearned revenues on licensing of the Company’s intellectual property to Arch Coal, Inc. (“Arch”) (as discussed further below); and

•

deferred rent revenue related to Clean Coal’s lease of its RC facilities (also as discussed further below).

Arch Coal

In June 2010, the Company entered into a Development and License Agreement with Arch in which the Company licensed, on an exclusive non-transferable basis, the use of certain of its technology to enhance coal by a proprietary coal treatment process and received a non-refundable license fee of $2 million in cash. The Company expects to recognize these revenues as the technology is further evaluated and developed and Arch realizes the benefits of the technology. As part of the agreement, Arch is required to purchase from the Company the chemicals required to enhance its coal. Future revenues of approximately $667,000 are expected to be recognized during the remainder of 2011 and are included in current deferred revenues.

Clean Coal

In June 2010, Clean Coal executed agreements to lease its RC facilities. These agreements provided for, among other things, a “prepaid rent payment” of $9 million for both facilities that was received before June 30, 2010. Thus far, in 2011, the Company has recognized $10.8 million in total rent revenues related to the RC facilities which includes $1.8 million from the initial prepaid rent payment. Future revenues expected to be recognized with respect to the prepaid rent paid are included in deferred revenues for the current period and in accrued warranty and other liabilities for the long-term period, and consist of the following:


Twelve Months Ending June 30,	Revenue to be Recognized
	(In thousands)
2012	$	3,600
2013		1,800

Total	$	5,400

(5)

Net Loss Per Share

Basic loss per share is computed based on the weighted average common shares outstanding in the period. Diluted loss per share is computed based on the weighted average common shares outstanding in the period and the effect of dilutive securities (stock options and awards) except where the inclusion is anti-dilutive.

All outstanding stock options (See Note 7) to purchase shares of common stock for the three and six months ended June 30, 2011 and 2010 were excluded from the calculation of diluted shares, as their effect is anti-dilutive.

(6)

Property and Equipment

Property and equipment consisted of the following at the dates indicated:


	Life in years		As of June 30, 2011			As of December 31, 2010
			(In thousands)
Machinery and equipment		3-10	$	2,637		$	2,497
Leasehold improvements		2-5		526			535
Furniture and fixtures		3-7		281			284
RC facilities under lease		10		5,825			4,725

				9,269			8,041
Less accumulated depreciation and amortization				(3,631	)		(3,235	)

Total property and equipment, net			$	5,638		$	4,806


	Six Months Ended June 30:
	2011		2010
	(In thousands)
Depreciation and amortization of property and equipment	$	386	$	550

(7)

Share Based Compensation

Since 2003, the Company has had several stock and option plans, including the Amended and Restated 2007 Equity Incentive Plan dated as of August 31, 2010 (the “2007 Plan”) and the ADA-ES, Inc. Profit Sharing Retirement Plan, which is a plan qualified under Section 401(k) of the Internal Revenue Code (the “401(k) Plan”) described below. These plans allow the Company to issue stock or options for shares of common stock to employees, Board of Directors and non-employees.

Following is a table summarizing the option activity for the six months ended June 30, 2011:


	Director & Employee Options			Weighted Average Exercise Price
O PTIONS O UTSTANDING , January 1, 2011		213,920		$	10.18
Granted		—			—
Exercised		(12,180	)		(8.72	)
Forfeited		—			—

O PTIONS O UTSTANDING AND E XERCISABLE , June 30, 2011		201,740		$	10.27

Following is a table of aggregate intrinsic value of options exercised and exercisable for the six months ended June 30, 2011:


Aggregate Intrinsic Value of Options	Value		Average Market Price
Exercised, June 30, 2011	$	170,520	$	14.00

	Value		Market Price
Exercisable, June 30, 2011	$	1,154,000	$	15.99

Stock options outstanding and exercisable at June 30, 2011 are summarized in the table below:


Range of Exercise Prices	Number of Options Outstanding and Exercisable		Weighted Average Exercise Price		Weighted Average Remaining Contractual Lives
$2.80		2,540	$	2.80		2.3
$8.60 - $10.20		143,743	$	8.66		4.4
$13.80 - $15.20		55,457	$	14.80		3.0

		201,740	$	10.27		4.0

No options were granted and/or vested during the three or six months ended June 30, 2011.

Although the Company adopted the 2007 Plan in 2007, it was further amended and restated as of August 31, 2010 to make non-material changes to assure Internal Revenue Code Section 409A compliance and to increase the non-management director annual grant limit to 15,000 shares of common stock from 10,000 shares. The 2007 Plan authorizes the issuance to employees, directors and non-employees of up to 790,372 shares of common stock, either as restricted stock grants or to underlie options to purchase shares of the Company’s common stock. Remaining shares available for issuance under the 2007 Plan are shown below.

In 2009, the Company revised its 401(k) Plan. The revision permits the Company to issue shares of its common stock to employees to satisfy its obligation to match employee contributions under the terms of the plan in lieu of matching contributions in cash. The Company reserved 300,000 shares of its common stock for this purpose. The value of common stock issued as matching contributions under the plan is determined based on the per share market value of the Company’s common stock on the date of issuance.

Following is a table summarizing the activity under various stock issuance plans for the six months ended June 30, 2011:


Stock Issuance Plans
	2007 Plan			401(k) Plan			Other Stock Plans
Balance available, January 1, 2011		93,943			183,794			12,065
Evergreen addition		44,593			—			—
Restricted stock issued to new and anniversary employees		(11,019	)		—			—
Stock issued based on incentive and matching programs to employees		(21,495	)		(16,276	)		—
Stock issued to directors		(26,755	)		—			(7,000	)

Balance available, June 30, 2011		79,627			167,518			5,065


Expense recognized under the different plans for the periods ended June 30, 2011:	(In thousands)
three months	$	38		$	92		$	—

six months	$	346		$	182		$	108


Unrecognized expense under the different plans for the periods ended June 30, 2011:	(In thousands)
three months	$	52	$	—	$	—

six months	$	388	$	—	$	—

A summary of the status of the non-vested shares as of June 30, 2011 is presented below:


Non-vested Shares	Shares			Weighted Average Grant Date Fair Value
Non-vested at January 1, 2011		92,936		$	5.46
Granted		12,391			13.61
Vested		(3,217	)		(11.26	)
Repurchased		(1,372	)		(7.48	)

Non-vested at June 30, 2011		100,738		$	6.25

(8)

Stockholders’ Equity

For the periods ended June 30, 2011 and 2010, the non-controlling interest portion of stockholders’ equity includes such interest related to Clean Coal. As described in Note 3, in May 2011, Clean Coal entered into a transaction in which it sold an effective 15% interest of its equity to GS. Approximately 15.8 units of non-voting Class B membership interests were issued to GS for $60 million in cash. ADA and NexGen each received $30 million as a result of the sale. In conjunction with the closing of the purchase agreement, ADA, NexGen and GS entered into a Second Amended and Restated Operating Agreement and ADA and NexGen each exchanged 50 units of membership interests for approximately 42.1 voting Class A units in Clean Coal (each of which represents a 50% voting interest). Since the transaction did not result in a change in control of Clean Coal, the amount received from this transaction was recorded to common stock, net of the tax effect of approximately $11 million.

(9)

Commitments and Contingencies

Retirement Plan

The Company assumed the 401(k) Plan covering all eligible employees as of January 1, 2003 which was revised in 2009, and makes matching contributions to the plan in the form of cash and its common stock. Such contributions are as follows:


	Three Months Ended June 30, 2011		Six Months Ended June 30, 2011
	(In thousands)
Matching contributions in stock	$	92	$	182

Performance Guarantee on AC Injection Systems

Under certain contracts to supply ACI systems, the Company may guarantee the performance of the associated equipment for a specified period to the owner of the power plant. The Company may also guarantee the achievement of a certain level of mercury removal based upon the injection of a specified quantity of a qualified AC at a specified rate given other plant operating conditions. In the event the equipment fails to perform as specified, the Company may have an obligation to correct or replace the equipment. In the event the level of mercury removal is not achieved, the Company may have a “make right” obligation within the contract limits. The Company assesses the risks inherent in each applicable contract and accrues an amount that is based on estimated costs that may be incurred over the performance period of the contract. Such costs are included in the Company’s accrued warranty and other liabilities in the accompanying consolidated balance sheets. Any warranty costs paid out in the future will be charged against the accrual. The adequacy of warranty accrual balance is assessed at least quarterly based on the then current facts and circumstances and adjustments are made as needed. The changes in the carrying amount of the Company’s performance guaranties are as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
	(In thousands)						(In thousands)
Beginning Balance	$	585		$	615		$	612		$	604
Warranties and guaranties accrued		16			23			38			57
Expenses paid and adjustments		(54	)		(8	)		(103	)		(31	)

Ending Balance	$	547		$	630		$	547		$	630

In some cases, a performance bond may be purchased and held for the period of the warranty that can be used to satisfy the obligation.

Line of Credit

Clean Coal has available a revolving line of credit with a bank for $10 million that is secured by substantially all assets of Clean Coal (including the interests it owns in its subsidiaries). The line of credit expires in March 2013 and requires quarterly interest payments. Borrowings under the line of credit bear interest at the higher of the “Prime Rate” (as defined in the related credit agreement) plus one percent (1%) or 5% per annum. At June 30, 2011, the outstanding balance on the line of credit was $4,168,000 and the effective interest rate was 5% per annum. Borrowings under the line of credit are subject to certain financial covenants applicable to Clean Coal.

Litigation

The Company is involved in litigation with Norit. The Norit lawsuit initially filed in Texas was moved to arbitration, and on April 8, 2011, the arbitration panel issued an interim award holding ADA liable for approximately $37.9 million for a non-solicitation breach of contract claim and held ADA and certain other defendants liable for royalties on adjusted sales of AC from the Red River plant. The payment schedule for the awarded obligations is expected to be determined when the final award is issued by the arbitration panel within the next few months. The Company expects to record a liability for the royalty payments concurrent with future sales from Red River as they are known. Approximately $1.6 million has been recorded for the six months ended June 30, 2011 related to the projected liability for royalty payments through 2011.

The Company has accrued current liabilities of approximately $33 million which is included in accrued arbitration award and related liability and a long-term liability of approximately $6.9 million which is included in accrued arbitration award on the accompanying consolidated balance sheets related to these awards. The final award will also address the potential for payment of legal fees incurred by Norit. The Company has made no accrual for potential payment of any such legal fees as such amounts, if any, cannot be determined at this time.

Carbon Solutions

In 2008, the Company made certain guaranties and undertook other obligations related to Carbon Solutions. No liabilities associated with such guaranties and obligations were recorded on the Company’s consolidated balance sheet as the Company does not expect such guaranties and obligations to be called upon.

Summaries of the guaranties and obligations related to Carbon Solutions are as follows:


	As of June 30, 2011
	(In thousands)
AC Facility construction contract ¹	$	13,200
Equipment contracts ²		4,500
Sales contract A guarantee ³		10,000
Sales contract B guarantee ⁴		1,000

Total guaranties and obligations	$	28,700

The Company has guaranteed all amounts owed by Red River under its construction contract for the AC Facility. The amount shown is the approximate remaining obligation under the contract. Red River can terminate this contract at any time and would be liable for certain items. The general contractor for the AC Facility has filed a lien on the AC Facility and a statement of claim against Red River and ADA totaling $21 million related to dispute of contract costs.

Red River entered into four contracts with an independent equipment supplier for the purchase of certain equipment. A parent guaranty is applicable to both the Company and our partner in the joint venture. The amount shown is the approximate remaining obligation remaining under these contracts. Red River may terminate these contracts at any time and would be liable for certain items.

The Company has also guaranteed the obligations of Red River under an amended sales contract with a major electric power generating company. Both parties are entitled to require specific performance of the other in limited circumstances when the cover remedies prove inadequate. No later than five business days after the third party debt financing portion for the AC Facility is obtained, each party is obligated to deliver to the other a $10 million standby, unconditional, irrevocable letter of credit to secure the obligations to the other party in the event of default.

⁴

The Company has also guaranteed the obligations of Red River under an amended sales contract with a different major electric power generation company. The guaranty is effective until Red River has fulfilled its contractual obligations, which is estimated to occur in the second quarter of 2012, and may be terminated earlier based on Red River’s financial position or the credit rating of its debt financing for the AC Facility. This is the Company’s maximum aggregate liability under the guaranty.

Under terms of agreements with Carbon Solutions, as amended in August, 2009, Red River has agreed to reimburse the Company and ECP in the event they are required to make payments related to any of the above noted guaranties and guaranties provided by ECP and has granted a secured interest in its assets to ADA and ECP to secure the reimbursement agreement and any loans ECP makes to Red River. Carbon Solutions has guaranteed the obligations of Red River under the reimbursement and loan agreement and has pledged its equity interest in Red River to the Company and ECP as security for this guaranty. The Company has assigned its rights under these agreements to ECP, and any amounts payable to the Company would be paid directly to ECP until ECP’s preferred equity in Carbon Solutions is fully redeemed or converted and all loans to Red River have been paid in full.

Under the terms of the JDA, the Company is required to indemnify ECP and Carbon Solutions for certain damages and expenses they incur with respect to the Company’s litigation and arbitration with Norit discussed above and described below in Part II, Item 1.

Following is a summary of contributions made by ECP:


	As of June 30, 2011		As of December 31, 2010
	(unaudited, in thousands)
Preferred equity contributions	$	86,400	$	89,300
Loans and accumulated interest payable to Red River by secured notes bearing interest at 12% per annum compounded quarterly.	$	208,800	$	193,800

Clean Coal

The Company also has certain guaranties and obligations in connection with the activities of Clean Coal The Company, NexGen and two entities affiliated with NexGen have provided the lessee of its RC facilities and GS with joint and several guaranties (the “CCS Party Guaranties”) guaranteeing all payments and performance due under the related transaction agreements. The Company also entered into a contribution agreement with NexGen under which any party called upon to pay on a CCS Party Guaranty is entitled to receive contribution from the other party equal to 50% of the amount paid. The parent of the lessee in the RC facilities lease transactions has provided Clean Coal with a guaranty as to the payment only of all the initial term fixed rent payments and the renewal term fixed rent payments under the related leases, which, although terminable at any time, cannot be terminated without the substitution of such guaranty with another guaranty on similar terms from a creditworthy guarantor.

(10)

Business Segment Information

The following information relates to the Company’s three reportable segments: Emission Control (“EC”), CO ₂ Capture (“CC”) and Refined Coal (“RC”). All assets are located in the U.S. and, other than RC segment assets that include assets under lease and other development costs totaling $9.8 million at June 30, 2011 and $5.3 million at December 31, 2010, are not evaluated by management on a segment basis.


	Three Months Ended June 30,					Six Months Ended June 30,
	2011		2010			2011		2010
	(In thousands)					(In thousands)
R EVENUE :
EC	$	1,709	$	1,600		$	3,742	$	4,664
CC		569		337			917		1,140
RC		4,748		—			10,834		—

Total	$	7,026	$	1,937		$	15,493	$	5,804


S EGMENT PROFIT ( LOSS ):
EC	$	179	$	61		$	915	$	991
CC		20		170			34		668
RC		3,808		(888	)		9,374		(1,533	)

Total	$	4,007	$	(657	)	$	10,323	$	126

A reconciliation of the reported total segment profit to net loss for the periods shown above is as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2011			2010			2011			2010
	(In thousands)						(In thousands)
Total segment profit (loss)	$	4,007		$	(657	)	$	10,323		$	126
Non-allocated general and administrative expenses		(6,054	)		(5,708	)		(10,335	)		(9,899	)
Depreciation and amortization		(207	)		(330	)		(392	)		(539	)
Interest, other income and other expenses		1,498			1,791			(37,412	)		1,811
Net equity in net loss of unconsolidated entities		(1,752	)		(1,568	)		(3,711	)		(2,750	)
Deferred income tax benefit		2,313			2,087			16,569			3,700
Net (income) loss attributable to non-controlling interest		(2,056	)		675			(4,835	)		1,021

Net loss attributable to ADA-ES, Inc.	$	(2,251	)	$	(3,710	)	$	(29,793	)	$	(6,530	)

Non-allocated general and administrative expenses include costs that benefit the business as a whole and are not directly related to any one of our segments. Such costs include but are not limited to accounting and human resources staff, information systems costs, facility costs, legal fees, audit fees and corporate governance expenses.

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations.

This Report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 that involve risks and uncertainties. Words or phrases such as “anticipates,” “believes,” “hopes,” “expects,” “intends,” “plans,” the negative expressions of such words, or similar expressions are used in this Report to identify forward-looking statements, and such forward-looking statements include, but are not limited to, statements or expectations regarding:

(a)	when final Maximum Achievable Control Technology (“MACT”)- based mercury and other regulations or pollution control requirements become effective and the impact of such regulations;

(b)	expected growth and anticipated opportunities in our target markets;

(c)	expected supply and demand for our products and services;

(d)	continued funding by Congress of our Department of Energy (“DOE”) CO ₂ projects, including industry cost share of such projects;

(e)	the effectiveness of our technologies;

(f)	expected timing of conducting additional demonstrations of our technology and completing a supply agreement with Arch Coal, Inc. (“Arch Coal”) and the amount of per ton benefit of coal our technology could provide;

(g)	the timing of awards of, and work under, our contracts and agreements and their value and their availability;

(h)	timing of construction, installation, meeting placed in service deadlines and commencement of full-time operations and expected production levels at the refined coal (“RC”) facilities of Clean Coal Solutions, LLC (“Clean Coal”);

(i)	Clean Coal’s expected use of its line of credit;

(j)	our ability to develop, place into service, generate tax credits under Section 45 of the Internal Revenue Code (“Section 45 tax credits”) and profitably sell, lease and/or operate additional RC facilities;

(k)	possible changes in the level of our ownership of ADA Carbon Solutions, LLC (“Carbon Solutions”), our joint venture with Energy Capital Partners (“ECP”);

(l)

the expected costs, capacity of, timing of full operational capacity and anticipated sales levels at the activated carbon (“AC”) facility (“AC facility”) built by ADA Carbon Solutions (Red River), LLC, a wholly-owned subsidiary of Carbon Solutions (“Red River”); and the need for additional AC production lines;

(m)	the willingness and ability of ECP to continue to fund operations of the AC Facility through contributions and loans to Carbon Solutions and its subsidiaries;

(n)	whether the guaranties and commitments the Company has made will be called upon;

(o)	timing and amounts of or changes in future revenues, funding for our business and projects, margins, expenses, earnings, dividends, tax rate, cash flow, working capital, liquidity, the value of recorded intangibles and other financial and accounting measures;

(p)	timing of the final award in the arbitration with Norit Americas, Inc. (“Norit”), timing and amount of payment obligations relating to the Norit arbitration, our ability to pay those obligations and the impact of the resolution of the Norit arbitration and related payment obligations; and

(q)	the materiality of any future adjustments to previously recorded revenue as a result of DOE audits.

The forward-looking statements included in this Report involve risks and uncertainties. Actual events or results could differ materially from those discussed in the forward-looking statements as a result of various factors including, but not limited to, our inability to satisfactorily resolve the Norit arbitration and related indemnity claims; adverse outcomes in current and future legal proceedings; lack of working capital to operate our businesses, pay ongoing legal expenses and satisfy our obligations relating to the Norit legal proceedings; timing of new and pending regulations and any legal challenges to them; the government’s failure to enact legislation, promulgate regulations or appropriate funds that benefit our business; changes in laws and regulations, prices, economic conditions and market demand; impact of competition; availability, cost of and demand for alternative energy sources and other technologies; technical, start up and operational difficulties; inability to commercialize our technologies on favorable terms; our inability to ramp up our operations to effectively address expected growth in our target markets; loss of key personnel; failure to satisfy performance guaranties; risks related to Carbon Solutions, including the willingness and ability of ECP to continue to fund costs of operating Carbon Solutions; ECP’s conversion of outstanding loans to Red River or preferred equity to ordinary capital contributions in Carbon Solutions; demand by ECP of payment on its loans to Red River or our indemnity obligations to it or Carbon Solutions; ECP’s control of Carbon Solutions and potential further dilution of our interest; failure to satisfy conditions in our existing agreements; inability of Carbon Solutions to respond to the expected increase in demand for AC through the construction of additional AC facilities or our inability to participate in such projects due to lack of funds or otherwise; the failure of the facilities leased by Clean Coal to continue to produce coal that qualifies for Section 45 tax credits; termination of the leases of such facilities; decreases in the production of RC by the lessees of Clean Coal’s RC facilities; plant outages; seasonality; failure of Clean Coal to build and place additional RC facilities in service by January 1, 2012; inability of Carbon Solutions and Clean Coal to obtain necessary permits; availability of raw materials and equipment for our businesses; our inability to realize our deferred tax assets; as well as other factors relating to our business, as described in our filings with the U.S. Securities and Exchange Commission, with particular emphasis on the risk factor disclosures contained in those filings and in Item 1A of our Annual Report on Form 10-K Part II Item 1A of the Form 10-Q filed for the period ended March 31, 2011 and Part II Item 1A of this Form 10-Q. You are cautioned not to place undue reliance on the forward-looking statements made in this report, and to consult filings we have made and will make with the SEC for additional discussion concerning risks and uncertainties that may apply to our business and the ownership of our securities. The forward-looking statements contained in this Report are presented as of the date hereof, and we disclaim any duty to update such statements unless required by law to do so.

Overview

We develop, offer and implement proprietary environmental technology and market specialty chemicals to the coal-burning electric utility industry, to the Portland cement industry and to industrial boiler operators. We have three operating segments: emission control (“EC”); CO ₂ capture (“CC”) and refined coal (“RC”). The EC segment includes the supply of emission control systems including powdered activated carbon injection (“ACI”) systems, acid gas mitigation systems and the sale of specialty chemicals, equipment and services for flue gas conditioning projects, the licensing of certain technology, consulting services related to such matters and other applications. The CC segment includes projects relating to the CO ₂ capture and control market, including projects co-funded by government agencies, such as the DOE. The RC segment includes revenues from the leasing of two facilities and the development and sale of technology, services and equipment for the RC market.

We conduct research and development efforts in CO ₂ capture and control from coal-fired boilers. On September 30, 2010, we signed our second significant contract related to CO ₂ capture with the DOE, which is scheduled to continue through the end of 2014. We are marketing our RC technology, services and equipment through our interest in our Clean Coal joint venture with NexGen Refined Coal, LLC (“NexGen”), an affiliate of NexGen Resources Corporation, and with an affiliate of The Goldman Sachs Group, Inc. (“GS”). We currently own interests in two operating RC facilities through Clean Coal which leases them through its subsidiaries to another GS affiliate. The two RC facilities are operated by Clean Coal Solutions Services, LLC (“CCSS”), a Colorado limited liability company owned 50% by us and 50% by NexGen. In addition, the Carbon Solutions joint venture, of which we owned 22.8% as of June 30, 2011, has commenced commercial operations at its AC Facility whose production is focused primarily on emissions control applications related to mercury emissions from coal burning utilities.

Emission Control

Environmental Legislation and Regulations

Mercury has been identified as a toxic substance and, pursuant to a court order; the U.S. Environmental Protection Agency (“EPA”) issued regulations for its control from power plants in March 2005, which was known as the “Clean Air Mercury Rule” or “CAMR.” CAMR was subject to significant challenges since it was issued and was ultimately declared invalid. In April 2010, the U.S. District Court of Appeals of the District of Columbia approved the consent agreement reached between the EPA and a coalition of public health and environmental groups that sued in 2008 to force the agency to set tighter emission limits. That settlement requires the EPA to issue a final rule requiring strict plant-specific controls for power plants' toxic air pollutants no later than November 16, 2011. On March 16, 2011, the EPA issued a draft of the Proposed Mercury and Air Toxics rules, a MACT based hazardous pollutant regulation, which provides for among other provisions, control of mercury and volatile metals such as arsenic, selenium and acid gases such as HCl and other Hazardous Air Pollutants (“HAPs”) (the “Mercury and Air Toxics Rule” or “MATR”). The proposed rule was officially listed by the EPA in the Federal Register on May 5, 2011 with comments due back by August 4, 2011. The draft MATR is based upon the average of the best-performing 12% of power plants and only allows minimal averaging or trading. The MATR proposed a limit for mercury emissions that will require capture of 80% to 90% of the mercury in the coal burned in electric power generation boilers. While the new regulations will require additional emission control equipment, the EPA estimates a small percentage of the current generation fleet will retire due to the cost of complying with the regulations.

In addition to the electric power generators, the EPA has developed a MACT-based mercury emissions regulation for the Portland Cement Industry through proposed amendments to the National Emission Standards for HAPs for the Portland Cement Manufacturing Industry (the “Cement MACT”). The Cement MACT regulation was finalized on September 9, 2010. On May 7, 2011, the EPA denied requests to issue an administrative stay on the Cement MACT and denied and granted in part various petitions to reconsider the final revised Cement MACT. The EPA is not delaying the implementation of the Cement MACT and is only reconsidering various technical standards and issues contained in the final regulation, which we do not believe will have a material impact on the regulation and its eventual implementation. This regulation requires cement plants to reduce HAPs by 2013 including 92% of mercury and 83% of hydrocarbons. This regulation could require ACI systems on up to 90 cement kilns in the U.S., which are owned by approximately 15 companies. We have been engaged in several testing programs for cement companies to define their emissions and evaluate how our ACI equipment and sorbents will work in that industry. The tests were designed to evaluate the effectiveness of collecting mercury and organics from cement kiln exhaust gas streams. We believe the Cement MACT will increase the market for both ACI systems and AC.

The EPA has also issued a new MACT regulation for coal-fired boilers that provide mostly steam and/or electricity for small industrial and institutional power needs with no more than 25 MW of electricity sold to the grid (the “Industrial Boiler MACT”). The final regulation was released on February 23, 2011 and issued on March 21, 2011, with compliance deadlines originally scheduled for early 2014. The EPA delayed the effective date of the final rule implementation of the Industrial Boiler MACT until such time as judicial review is no longer pending or until such time as the EPA

completes its reconsideration of the related rules. The EPA is reconsidering various aspects of the regulation including its application to a wide variety of boiler types and fuels. In addition, proposed legislation in the United States Senate (S. 1392) would provide additional time for the EPA to reconsider the regulation and would extend the period in which regulated boilers must be brought into compliance to five years, rather than the normal three years.

The Industrial Boiler MACT could impact over 600 existing coal-fired industrial boilers. The final emission limit of 4.6 pounds of mercury per Trillion BTU for existing and two pounds per Trillion BTU for new coal-fired industrial boilers will on average require < 50% capture of mercury from coal-fired boilers burning various coals. We believe the final Industrial Boiler MACT could increase the market for ACI systems by several hundred and the associated AC by approximately 50 million pounds per year when considering the requirement to control both mercury and dioxin/furans under this final rule that can be controlled by use of activated carbon injection. These totals could be even higher, when considering that 400 or more biomass and wood fired boilers are also covered under this regulation.

The Clean Air Act requires that all emission control related regulations be met within 36 months. We believe that substantial long-term growth of the EC market for the electric power generation industry will most likely depend on how industry chooses to respond to the pending and new federal regulations. In general, all three of these regulations are less stringent than originally expected, meaning more flexibility in choosing low capital expense control technologies and likely fewer forced retirements from having to install large capital equipment, such as scrubbers and baghouses. We anticipate the final MATR will create a large market for our mercury control products beyond 2011. We expect that as many as 1,200 existing coal-fired boilers will be affected by such regulations, if and when they are fully implemented. We believe that the MATR will be made final by the November 2011 deadline. Many power companies recognize the urgency of these pending regulations, and as a result we are contracting with power plants to evaluate mercury control options at a number of their plants. Utilities need to know as soon as possible whether their existing EC components are sufficient to meet the new test limits with the installation of ACI and dry sorbent injection (“DSI”) systems. If they need to upgrade their equipment with new fabric filters or possible scrubbers, they need to quickly begin procurement of that large capital equipment due to long required lead times. This could result in near-term ACI demonstration revenue and positions us to bid on related ACI equipment.

ACI Systems and Services

To date, we have installed or are in the process of installing 49 ACI systems. Some market demand continues in 19 states that either have passed their own mercury control regulations or have entered agreements with power plants to reduce mercury emissions for new power plants. We remain active in the bid and proposal process and expect the number of awards this year to remain flat or decline compared to last year. Although we expect the equipment market to continue to be static in 2011, we believe we have the opportunity for significant revenue growth for our EC products and services when final federal regulations or legislation affects a significant portion of previously uncontrolled and existing boilers. Given the current expected timing for finalization of the MATR, we anticipate the need for 400 to 700 ACI systems to be supplied between 2012 and 2015, which would require rapid scale-up of our production capabilities to maintain our approximate 30% market share. For an average Electric Generating Unit, the ACI equipment costs are between $600,000 and $1 million. We are expanding our sales staff as well as our engineering design group and fabrication capacity to meet this anticipated market. We believe contracts for ACI systems will not begin to be awarded until later this year when the rule is made final, but we are already in discussions with some utilities about early fleet-wide procurement.

We have also developed and are offering commercial systems to inject dry alkali sorbents for control of acid gases such as SO ₃ and HCl as well as for control of the criteria pollutant SO ₂ . DSI systems, which cost approximately $2 to $3 million for an average size plant, provide a low-capital cost alternative to scrubbers for meeting certain provisions of the MATR and the Cross State Air Pollution Rule, which was finalized by the EPA on July 6, 2011 (“CSAPR”, formerly known as the “Transport Rule”). CSAPR replaces the EPA’s 2005 Clean Air Interstate Rule and requires 27 states in the eastern half of the United States and the District of Columbia to significantly improve air quality by reducing power plant SO ₂ and nitrogen oxide emissions that contribute to ozone and fine particle pollution in other states. Plants in the 27 impacted states will be required to comply with emission reductions quickly; beginning January 1, 2012 for SO ₂ and annual nitrogen oxide reductions, and May 1, 2012 for ozone season nitrogen oxide reductions. We conducted full-scale tests of the DSI equipment in 2010 and for the past year ADA has been demonstrating DSI equipment for the control of SO ₂ and SO ₃ on plants burning bituminous, Powder River Basin (“PRB”), and lignite coals. The DSI approach is also a low-cost option for utilities for meeting the particulate matter standard proposed in the MATR because dry sorbents can capture condensable material that are part of the regulated particulate matter emissions. Experts have predicted that up to a quarter of the 1,200 plus coal fired boilers could be forced to shut down if they were required to add scrubbers and selective catalytic reduction systems which can cost $200 to $300 million per installation.

We are developing and providing services and bidding on systems to measure and mitigate acid gases from coal fired boilers. These acid gas emissions are often the unintended result of the retrofit and operation of NO _x control technology on medium to high sulfur coal-fired boilers.

Arch Coal Development and License Agreement for Enhanced Coal

Since 2004, we have been working with Arch Coal to explore certain unique characteristics of some types of coals produced by Arch Coal that allow them to be burned with lower emissions. We believe a recent technical breakthrough provides a potential means to obtain similar performance improvements from all of Arch Coal’s PRB coals. As a result on June 25, 2010, we entered into a Development and License Agreement (the “License Agreement”) with Arch Coal. Pursuant to the License Agreement, we provided Arch Coal with an exclusive, non-transferable license to use certain technology to produce “Enhanced Coal” by the application of ADA’s proprietary coal treatment technology for coal mined by Arch Coal at mines and sites located in the PRB. We expect that the technology will reduce certain emissions from the burning of the PRB coal, which should help to meet the MATR. Pursuant to the License Agreement, we are providing development services to Arch Coal aimed at applying the technology to the PRB coal. In addition, if we develop improvements to the technology that are related to the reduction of certain emissions from the burning of PRB coal, that technology will either be included in the license at no additional cost, or, under certain circumstances, we will negotiate with Arch Coal to determine if Arch Coal wants to use the additional improvements. We retain all right, title and interest, including all intellectual property rights, in and to any technology we license to Arch Coal. The initial demonstration of coal treated at the mine and shipped by rail to a power plant produced promising results.

In consideration for the development work and the license to Arch Coal, Arch Coal paid us an initial, non-refundable license fee in cash of $2 million in June 2010 and we have recognized $735,000 of such amount as revenue for the six months ended June 30, 2011 in addition to amounts recognized in 2010. Arch Coal may be obligated to make royalty payments to us that could amount to as much as $1 per ton of the premium for “Enhanced Coal” sold by Arch Coal, depending upon the successful implementation of the technology and the premium Arch Coal is able to charge on future sales of the “Enhanced Coal” product. Arch Coal currently produces more than 100 million tons of PRB coal per year. Any royalty ultimately payable under the License Agreement will first be subject to credit to Arch Coal of an amount equal to the initial license fee, other development and operational costs paid by Arch Coal plus a rate of return on such payments.

The License Agreement contains standard indemnification provisions customary for license agreements, including indemnification by us for any losses suffered by Arch Coal as a result of any claims for infringement by the technology as to intellectual property rights of any third party. Either party may terminate the License Agreement upon written notice to the other party if the other party materially breaches any material term of the License Agreement, generally with a right to cure a breach within 30 days. In addition, if we materially breach the provisions of the License Agreement relating to ownership of the related technology and maintaining confidential information, and fail to correct any such breach within 30 days, the licenses granted to Arch Coal become fully paid-up, perpetual and irrevocable, without any further obligation of Arch Coal to pay any ongoing royalty.

In recent tests we have shown that we can enhance PRB coal at the mine and achieve mercury reductions when the coal is burned at power plants. We believe the coal enhancement provides a $1 to $4 per ton benefit of coal to the power plants. The proposed MATR could create a market for a significant percentage of the greater than 100 million tons per year of PRB coal mined by Arch. Because of our focus on placing in service additional RC facilities prior to the end of this year, additional demonstrations of our Enhanced Coal product have been delayed. We expect to resume these tests later this year and in 2012 which will provide sufficient time to grow this business as the national mercury control market expands through 2015.

As a part of entering into the License Agreement we agreed to negotiate and enter into a Supply Agreement under which Arch Coal will purchase the chemicals described in the License Agreement exclusively from us. We expect to negotiate the final terms of the Supply Agreement in the next six months.

CO ₂ Capture

In addition to our two key growth areas, emissions control and RC, we continue to demonstrate our position as a premier developer of innovative clean energy technologies. Control of CO ₂ from coal-fired power plants is currently a topic of discussion in Washington and a significant issue for the coal industry as a result of the impact of CO ₂ emissions on climate change. We see this as an opportunity and have begun developing technologies to address the needs of our customers through reduction of CO ₂ generation and CO ₂ capture.

DOE is funding CO ₂ control projects related to our business and on September 30, 2010, we signed a new contract with them to continue development of clean coal technology to capture CO ₂ from coal-fired power plants and other industrial sources of CO ₂ emissions. We are the prime contractor for the approximately $19 million project administered by DOE’s National Energy Technology Laboratory which is providing $15 million of the funding. We expect approximately $4 million in co-funding and support to be provided by several major electric power generation companies including Southern Company, Luminant and the Electric Power Research Institute, Inc. The project provides funding to advance our commercialization plan for regenerable solid-sorbent technology, which is designed to capture CO ₂ generated by coal-fired power plants.

In 2010 we began the first field tests of our CO ₂ control technology on a $3.8 million program co-funded by DOE, as well as several major forward-thinking utility companies. The initial results at a plant confirmed the promising performance we had demonstrated in our laboratory. The pilot plant was moved to another plant for additional testing. Once captured, the CO ₂ could be either stored underground (sequestration) or beneficially used in processes such as enhanced oil recovery. This capture technology appears to offer potential cost and energy advantages over competing liquid-solvent-based technologies.

In October 2010 we began work on the new DOE CO ₂ project, which is expected to run for a total of 51 months to scale-up the technology to the one-megawatt level, which is a key step in the technology development process. This contract will not only fund research and development (“R&D”) on this technology, but it is expected to provide significant contributions to our revenue and margin over the next three plus years.

We anticipate that DOE programs will continue to represent an important component of the revenue stream of the Company over the next several years as we position ourselves for the market growth for ACI systems, enhanced coal and related technology with Arch Coal and other technologies for emissions control.

Refined Coal

Environmental Legislation and Regulations and Opportunities

Clean Coal’s primary opportunity is based on Section 45 tax credits for the production of refined coal and proprietary technology developed by ADA that has been licensed to Clean Coal. In December 2009, the IRS issued guidance as to the specifics concerning how the emissions reductions are to be measured and certified to demonstrate compliance necessary to qualify for the Section 45 tax credits and under the Tax Relief and Job Creation Act of 2010, the deadline for placing qualifying facilities into service was extended to December 31, 2011. The tax credits amount to an annually escalating $6.33 per ton of RC for a period of ten years for facilities placed in service prior to January 1, 2012.

As a result of the extension of the placed in service deadline, we are pursuing strategic relationships to sell or lease several additional RC facilities during 2011 with a potential of up to 16 total RC facilities. Thus far Clean Coal has built the generic portions of 10 facilities to address its anticipated opportunities each capable of producing one to five million tons of RC per year. In June of this year, Clean Coal installed and placed in service one of these units at a plant that is expected to burn up to four million tons of RC per year. This new facility was operated for the period of time deemed necessary to meet the IRS placed in service deadline, and when burned, the RC produced demonstrated the reductions in mercury and NOx emissions necessary to qualify for the Section 45 tax credit. Clean Coal has also installed four additional facilities at power plants burning an aggregate of over 10 million tons of coal per year; however, initial operations and testing were postponed for several weeks because of the severe heat wave in the Midwest. We expect these four units to be placed in service some time before September of this year. Following the completion of the facility demonstrations, operating permits and contracts between the utilities and the financial institution monetizing the tax credits will need to be finalized prior to commencing full-time operations to produce RC, which we expect to take four to six months per facility and occur late in the fourth quarter of this year as to these four units. We expect the remaining 11 facilities to be placed in service this fall. We believe the market potential for the additional 16 facilities to be approximately 30 million tons in the aggregate, which we estimate to be a 50% market share.

Clean Coal is financing the construction and installation of the additional RC facilities with the Line of Credit described below. In addition, we are negotiating terms with monetizers to provide advance payments of rent once the facilities are placed in service and become operational.

Clean Coal Existing Facilities, Leases and Related Agreements

Clean Coal placed two RC facilities in service prior to January 1, 2010 (the original placed in service deadline under Section 45) and demonstrated the required emission reductions for their RC product to qualify for the Section 45 tax

credits. On June 29, 2010, Clean Coal executed contracts by which the two existing RC facilities were leased to GS RC Investments LLC, (“GSRC”, which is another affiliate of GS), the lessee. The leases have base terms that run through December 31, 2012 (the “Initial Term”), and automatically renew for annual terms through the end of 2019. The other 50% voting interest in Clean Coal is owned by NexGen and the two RC facilities are owned, respectively, by two special purpose entities (the “Lessors”). Clean Coal owns 95%, and we and NexGen each own 2.5% of the Lessors. The lessee has entered into supply agreements for each RC facility pursuant to which it supplies RC to the applicable power plant owner. CCSS (subject to oversight by the lessee) operates and maintains the RC facilities under two Operating and Maintenance Agreements entered into with the lessee as part of the transaction. In addition to reimbursement for costs incurred, CCSS receives a fee of $.08 per ton of coal processed through the RC facilities for its services. The lessee pays the costs for operating and maintaining the RC facilities, subject to certain limitations. CCSS also arranges for the purchase and delivery of certain chemicals necessary for lessee’s production of RC under two supply agreements entered into with the lessee as part of the transaction. CCSS receives a fee for its services in the amount of 5% of the cost of chemicals and transportation costs. The term of each supply agreement runs coincident with the leases.

We, Clean Coal and the lessee also entered into a technology sublicense agreement (the “Technology Sublicense”) pursuant to which we licensed, and Clean Coal sublicensed, to the lessee certain technology required to operate each RC facility and to produce RC. The Technology Sublicense parallels the license previously granted by us to Clean Coal and requires that we stand behind Clean Coal if it fails to perform its obligations under the sublicense, other than as a result of a default by lessee. The agreement contains representations and warranties customary for such agreements regarding intellectual property, and, subject to certain liability limits, requires us to indemnify the lessee in the event of certain infringement claims by a third party. We are also obligated to actively prosecute infringement of the technology by third parties, or to cooperate with the lessee if it does so, in which case any award would go to the lessee and any other sublicensee who prosecutes the infringement. The annual license fee payable to Clean Coal for the sublicense is $10,000 per year, but this amount is deductible from the amount the lessee pays in rent under the leases.

In addition, we, NexGen and two entities affiliated with NexGen have provided the lessee with joint and several guaranties (the “CCS Guaranties”) guaranteeing all payments and performance due under the agreements described above. We also entered into a contribution agreement (the “Contribution Agreement”) with NexGen under which any party called upon to pay on a CCS Guaranty is entitled to receive contribution from the other party equal to 50% of the amount paid. The parent of lessee provided Clean Coal with a guaranty as to the payment only of all fixed rent payments under the leases, which, although terminable at any time, cannot be terminated without the substitution of such guaranty with another guaranty on similar terms from a creditworthy guarantor.

In September 2010, the RC facilities ramped up production to expected continuous levels and are now treating over 95% of the available coal used by the four generating units at the two power plants. During the first six months of 2011, these two units generated over $10 million in consolidated revenues for ADA. These production levels are expected to generate between approximately $15 to $20 million per year in revenues and, after deduction of NexGen’s and GS’s share, between approximately $7 to $9 million in pre-tax cash flow and operating income, or approximately $1 per diluted share annually for ADA through 2019 (assuming no significant change in outstanding number of shares).

Organization and Control

We originally formed Clean Coal in 2006, and sold a 50% interest in it to NexGen for $1 million. Under the original Purchase and Sale Agreement, NexGen had the right (but not the obligation) to maintain its 50% interest in Clean Coal by paying us an additional $4 million at certain specified times. In October, 2009, NexGen elected to retain its interest in Clean Coal and issued $1.8 million two-year promissory notes to the Company in June 2010, with the remainder of the payment to come from 25% of cash distributions (other than for income taxes) due to NexGen from Clean Coal.

In May 2011, we and NexGen entered into a transaction in which Clean Coal sold an effective 15% interest of the equity in Clean Coal, equal to approximately 15.8 units of non-voting Class B membership interests, to an affiliate of GS for $60 million in cash (the “Purchase Price”) pursuant to a Class B Unit Purchase Agreement (the “Purchase Agreement”). In conjunction with the closing of the Purchase Agreement, we, NexGen and GS entered into a Second Amended and Restated Operating Agreement for Clean Coal (the “Restated Operating Agreement”) and an Exclusive Right to Lease Agreement (the “Lease Agreement”). Pursuant to the Restated Operating Agreement, we and NexGen each exchanged 50 units of membership interests in Clean Coal for approximately 42.1 voting Class A Units in Clean Coal, representing a total of approximately 84.2% of the equity interests in Clean Coal following the Transaction. ADA and NexGen each received $30 million as a result of the sale, and subsequent to the transaction with GS, NexGen paid the Company the remaining balance due of $1.8 million as payment in full of the amount owing by NexGen to maintain its interest in Clean Coal, including payment in full of all other amounts owing to us totaling $480,000 under certain previously issued “tonnage notes.”

Pursuant to the transaction with GS, we and NexGen provided GS with joint and several guarantees (the “Limited Guarantees”) guaranteeing the performance by Clean Coal of its obligation to indemnify GS against certain losses it may suffer as a result of inaccuracies or breaches of the representations and warranties made by Clean Coal in the Purchase Agreement or the Lease Agreement, or if Clean Coal breaches its covenants in the Purchase Agreement or the Lease Agreement. Clean Coal’s indemnification obligations for breaches of representations, warranties and covenants, other than for breaches of the representations involving organization, subsidiaries, capitalization and voting rights, authority and non-contravention and valid issuance, are subject to a non-recoverable deductible of $500,000 and a cap of the Purchase Price. We also entered into a contribution agreement with NexGen under which any party called upon to pay on a Limited Guaranty is entitled to receive contribution from the other party equal to 50% of the amount paid.

The rights and obligations of the parties are set forth in detail in the Restated Operating Agreement, which provides, among other related terms and conditions, that prior to April 1, 2012, Distributable Cash (as defined in the Restated Operating Agreement) will be distributable approximately 84.2% to us and NexGen as holders of the Class A Units and approximately 15.8% to GS as the holder of the Class B Units. Given the 2.5% direct interest both we and NexGen retain in subsidiaries of Clean Coal previously formed to operate any RC facilities, the effective sharing ratio of net cash generated by all expected refined coal operations is 15% to GS and 85% to us and NexGen. Beginning with distributions made after December 31, 2012, Clean Coal must distribute no less than 70% of Distributable Cash, at least annually. Within 10 days of April 1, 2012, Clean Coal must calculate a “Projected Distributable Value,” which is defined in the Restated Operating Agreement as an estimated amount equal to the net present value, using a 15% discount rate, that Clean Coal projects it will receive through the end of the term of all effective (i.e., contractually committed) RC facilities. For distributions occurring after April 1, 2012, if 15.8% of the Projected Distributable Value is equal to or greater than GS’ “Unrecovered Investment Balance” (which is the dollar amount necessary, at any given time, to return GS at least its $60 million investment, plus a 15% return thereon, taking into account all prior distributions to GS), GS is entitled to receive 15.8% of each distribution. If the “Projected Investment Value” (which is 15.8% of the Projected Distributable Value) is less than the Unrecovered Investment Balance as of the time for any given distribution, then an adjustment will be made to the distribution ratios to compensate GS for this deficiency. This adjustment is to be updated from time to time over the life of the investment, and at any time when Projected Investment Value becomes equal to or greater than GS’ Unrecovered Investment Balance, the amount payable to GS again becomes 15.8% of the distribution (or a lesser amount if amounts previously distributed have resulted in overpayments to GS). Clean Coal may make greater distributions to GS than required at any given time in order to shorten the time in which the Unrecovered Investment Balance will be reduced to $0.

In addition, the Restated Operating Agreement provides that upon the occurrence of a Liquidation Event (as defined in the Restated Operating Agreement), GS will be entitled to receive the greater of (A) a liquidation preference in an amount equal to the Unrecovered Investment Balance as of the date of such Liquidation Event (the “Liquidation Preference”) or (B) GS’ pro rata share of the proceeds from such Liquidation Event.

Furthermore, the Restated Operating Agreement states that on or after the earlier of (i) a breach of any material provision of the Purchase Agreement or Clean Coal’s organizational documents that is not cured in accordance with the Restated Operating Agreement and that results in damages to GS of at least $10 million or (ii) the 10 year anniversary of the date the last refined coal facility owned by Clean Coal or one of its subsidiaries is placed in service (but in no event later than December 31, 2021), and if the Unrecovered Investment Balance has not been reduced to zero, GS may require its Class B Units to be redeemed by Clean Coal for an amount equal to its Unrecovered Investment Balance, payable within 180 days of the notice of redemption. In addition, the Restated Operating Agreement contains provisions in regard to GS’ right to a board observer, each parties’ rights and obligations with respect to capital calls, preemptive rights, approval of certain transactions, drag-along and tag-along rights, a covenant not to compete, an obligation for us to present certain related “business opportunities” to Clean Coal for its consideration and related matters.

Pursuant to the Lease Agreement, Clean Coal granted GS the exclusive right (but not the obligation) to lease facilities that will produce up to approximately 12 million tons (+/- 10%) (the “Target Tons”) of refined coal per year on pre-established lease terms similar to those currently in effect for Clean Coal’s two existing facilities, but which are more economically favorable to Clean Coal than the rates in the present leases for the existing refined coal facilities that Clean Coal leased to another GS affiliate in June, 2010. Clean Coal is required to submit a package to GS with respect to each RC facility it proposes that GS consider for leasing (being all RC facilities developed by Clean Coal until the Target Tons are met), and upon certification and acceptance of the certification for a given RC facility by GS, GS is required to pay Clean Coal, as a deposit, an agreed amount for each 1 million tons of projected annual refined coal production. Upon closing of a lease of a RC facility from Clean Coal, GS is required to pay Clean Coal an additional amount per 1 million tons of projected annual refined coal production. These payments are paid as advance rent, and actual amounts due under the leases (with true-ups) will be paid in accordance with the operative lease and related agreements, which will be based

on the forms of documents that were used in the transactions for the existing RC facilities leased to GSRC and will include guaranties by us and NexGen. The initial lease terms will be five years, with annual renewals for five successive one-year periods. If GS determines that it wishes not to lease a RC facility after it has paid the deposit, it can demand the return of the deposit paid for that RC facility, and the deposit must be paid within 30 days of the end of the quarter in which the demand is made. The amount of any deposit will earn interest from the date of demand until the deposit is paid.

In connection with the transaction, including the entry into the Lease Agreement, Clean Coal and GSRC agreed to cancel the existing “first right of refusal” that was previously granted to GSRC under the existing agreement to lease in connection with the leasing by GSRC of two existing RC facilities. Under the cancelled first right of refusal GSRC had the first right to lease RC facilities with up to 14 million tons of refined coal production per year.

We control and consolidate the results of Clean Coal in our financial statements, but do not consolidate the results of CCSS because NexGen controls the entity pursuant to the operating agreement of the entity. The leases for Clean Coal’s existing RC facilities included an upfront payment of $9 million in prepaid rent for both facilities and provide for fixed rent and contingent rent based upon future production of RC, each of which is payable on a quarterly basis. We are recognizing the prepaid rent over the initial three year term of the leases. Such revenues are recorded as they are earned. Historically, the utilities at which the facilities operate have used over six million tons of coal per year, which amount can vary based on several factors. The total annual contribution to our operating income will ultimately depend on the utilities’ use of coal in the generation of electricity, which use will likely fluctuate over the term of the tax credits. Each lease may be terminated by the lessee for various reasons, the most significant of which are:

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For any reason as of the end of the initial term by giving notice by no later than July 1, 2012.

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If the Total Operating Expenses (as defined in each lease) paid by the lessee for two consecutive quarters exceed 140% of the projected operating costs for the RC facility.

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If any of Lessor’s representations or warranties were breached as of the date made and such breach is not cured within 30 days after notice.

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If a change of law, or certain other specified events affecting the availability of the Section 45 credits, occurs.

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Upon the occurrence of a governmental regulatory event that would make the contemplated transaction impermissible.

In order to maintain our 50% voting interest in Clean Coal, we are obligated to fund half of its operating costs and capital expenditures. We expect the operations of the RC facilities to generate sufficient working capital to meet their operating needs. On March 31, 2011, Clean Coal entered into a credit agreement with a bank for $10 million that is secured by substantially all assets of Clean Coal (including the interests it owns in its subsidiaries) (the “Line of Credit”). The Line of Credit expires in March 2013 and requires quarterly interest payments. Borrowings under the Line of Credit bear interest at the higher of the “Prime Rate” (as defined in the related credit agreement) plus one percent (1%) or 5% per annum. At June 30, 2011, the outstanding balance on the Line of Credit was $4,168,000 and the effective interest rate was 5% per annum. Borrowings under the line of credit are subject to certain financial covenants applicable to Clean Coal.

Carbon Solutions

Carbon Solutions, our joint venture company with ECP, has constructed the AC Facility through its wholly owned subsidiary Red River. The AC Facility, which achieved commercial operation in May 2010, is operating and currently supplying customers with AC. In the second half of 2010 the AC passed certification testing that will allow it to be sold into the water market.

Under the terms of the Limited Liability Company Agreement (the “LLC Agreement”) of Carbon Solutions among ECP and ADA, we have contributed $25.6 million in cash and other property and ECP has contributed cash of $175.7 million, including preferred equity contributions of $86.4 million, through June 30, 2011. Effective June 2009 and since that date, ECP converted some of its preferred equity contributions to ordinary capital contributions resulting in a dilution of our ownership percentage to 22.8% as of June 30, 2011 and as a result, we include our share of Carbon Solutions’ loss under the equity method of accounting. Our initial investment combined with our share of Carbon Solutions’ cumulative losses to date has resulted in a net investment in Carbon Solutions of $9.8 million as of June 30, 2011. We do not have any further capital commitments to Carbon Solutions, and expect that all future funding for the AC Facility will come from ECP and third-party debt financing. See “Liquidity and Capital Resources” below for additional information.

Carbon Solutions predicts a significant gap between AC production and demand beginning in 2012, with the gap growing close to a billion pounds per year after all the MACT regulations are in place by 2015. They believe that the growth anticipated will require up to five additional AC production lines of the same size and capacity as Red River. To prepare for the additional demand created by the draft Air Toxics Rule, Carbon Solutions has permitted a second 150 million pound per year production line at the Red River plant. We have certain rights to participate by up to 50% in capacity additions Carbon Solutions may pursue.

In addition, we provide certain services to Carbon Solutions under a Master Services Agreement (“MSA”). Sales and other revenues under the MSA totaled $22,000 and $52,000 for the three and six months ended June 30, 2011, respectively, which amounts are included in EC revenues in the accompanying consolidated statement of operations.

Results of Operations – 2 ^nd Quarter and YTD 2011 versus 2 ^nd Quarter and YTD 2010

Revenues totaled $7 million and $15.5 million for the three and six months ended June 30, 2011, respectively, versus $1.9 million and $5.8 million for the three and six months ended June 30, 2010, respectively, representing an increase of 263% and 167% for the quarter and year to date. We expect overall revenues for the rest of the year to be higher than those reported for the 2010 period primarily as a result of the impact from the RC segment.

Cost of revenues decreased by $78,000 and $1.3 million or 4% and 29% for the three and six months ended June 30, 2011, respectively, from the same periods in 2010 primarily as a result of decreased revenues in our EC and CC segments and lower RC segment costs as described below. Gross margins were 74% and 80% for the three and six months ended June 30, 2011, respectively, as compared to less than 1% and 23% for the same periods in 2010. The increase primarily reflects the increased RC margins and revenues as described below. For the near term, we expect the sales related to the RC segment to represent an increasing source of revenues, for which the anticipated gross margins are higher than our EC and CC segments. As a result, we expect the gross margin for 2011 to be higher than the overall margin realized in 2010.

Emission Control

Revenues in our EC segment totaled $1.7 million and $3.7 million for the three and six months ended June 30, 2011, respectively, representing an increase of 7% and a decrease of 20% from the same periods in 2010. The amounts reported exclude the work ADA has conducted for Clean Coal, as further described below, which was eliminated in our consolidation. Revenues from the EC segment for the six months ended June 30, 2011 were comprised of sales of ACI systems and services (30%), flue gas chemicals and services (15%) and other services (55%), compared to 77%, 3%, and 20%, respectively, for the same period in 2010. For the near term, we expect the consulting services in our EC segment to increase as a percentage of EC revenues as the industry seeks to analyze and evaluate the MACT regulations in addition to increased revenues related to our technical breakthrough related to PRB coal. We expect our EC segment revenues related to ACI systems to remain at static levels until such time as utilities, cement plants and industrial boilers start to react to the MACT regulations. We expect overall gross margins for the EC segment for 2011 to be higher than levels achieved in 2010.

Our consulting revenues increased approximately $603,000 and $1.1 million during the three and six months ended June 30, 2011, respectively, as compared to the same periods in 2010 as we began demonstration and other work related to recent changes with the MACT regulations and includes revenues totaling $333,000 and $667,000, respectively, from our Arch Coal non-refundable license. Our consulting revenues contributed approximately $1.1 million and $1.9 million during the three and six months ended June 30, 2011 and we expect our consulting revenues to increase as a percentage of EC revenues during the remainder of 2011 as several customers are seeking advice and evaluation studies on how best to comply with the finalized MACT regulations.

As of June 30, 2011, we had contracts in progress for work related to our EC segment totaling approximately $2.1 million, of which we expect to recognize a significant portion during the remaining six months of 2011, with the balance to be completed and realized in 2012. Our ACI systems revenues totaled $488,000 and $1.1 million for the three and six months ended June 30, 2011, respectively, representing a decrease of 57% and 68% as compared to the same periods in 2010. In the EC segment, we performed work related to RC systems provided to Clean Coal valued at $359,000 and $471,000 for the three and six months ended June 30, 2011, respectively, that would otherwise be recognized as revenue but were eliminated in the consolidation of Clean Coal. In the EC segment, we performed work related to RC systems provided to Clean Coal valued at $2.7 million and $3.2 million for the three and six months ended June 30, 2010, respectively, that would otherwise be recognized as revenue but were eliminated in the consolidation of Clean Coal. The prior year includes our participation in the construction and installation of the initial RC facilities that were placed in service in at the end of 2009. In the current year, Clean Coal is utilizing a number of additional resources for of the planned new RC facilities.

Cost of revenues for the EC segment decreased by $237,000 and $1.2 million for the three and six months ended June 30, 2011, respectively, from the same periods in 2010, primarily as a result of the decreased revenue-generating activities from our ACI system sales. Gross margins for the EC segment were 44% and 52% for the three and six months ended June 30, 2011, respectively, compared to 25% and 35% for the same periods in 2010. The increase in gross margin from the prior year was primarily a result of cost savings from original budgeted amounts when the contracts commenced.

EC segment profits increased by $118,000 or 193% and decreased by $76,000 or 8% for the three and six months ended June 30, 2011, respectively, compared to the same periods in 2010. The decrease in the six-month period was primarily a result of decreased ACI system sales.

CO ₂ Capture

Revenues in our CC segment totaled $569,000 and $917,000 for the three and six months ended June 30, 2011, representing an increase of 69% and decrease of 20% from the same periods in 2010. We had outstanding DOE contracts, including anticipated industry cost share in progress totaling approximately $17.9 million as of June 30, 2011. We expect to recognize approximately $1.6 million from these contracts during the remainder of 2011 including participation by other industry partners and the remainder in 2012 through 2014. As discussed above, on September 30, 2010 we signed a contract on a DOE project totaling approximately $19 million (including expected contributions by other industry partners). Revenues increased in the second quarter due to the increased activities under this contract.

Cost of revenues for the CC segment increased by $332,000 and $351,000 for the three and six months ended June 30, 2011, respectively, compared to the same periods in 2010. Gross margins for this segment were 16% and 17% for the three and six months ended June 30, 2011, respectively, as compared to 57% and 64% for the same periods in 2010. The decrease in gross margin from 2011 to 2010 is due primarily to greater use of subcontractors for which our margins are less under these projects. Lower cost share participation from third parties also contributed to higher costs and lower margins. We expect the overall gross margin for the CC segment for fiscal year 2011 to be lower than the levels achieved in 2010, due to the mixture of direct costs (labor versus equipment) associated with this segment.

CC segment profits decreased by $150,000 and $634,000 or 88% and 95% for the three and six months ended June 30, 2011, respectively, compared to the same periods in 2010. As discussed above, the decrease was primarily the result of greater use of subcontractors and lower cost share participation. Our contracts with the government are subject to audit by the federal government, which could result in adjustments to previously recognized revenue. Our historical experience with these audits has not resulted in significant adverse adjustments to amounts previously received; however the audits for the years 2004 and later have not been finalized. We believe, however, that we have complied with all requirements of the contracts and future adjustments, if any, will likely not be material. In addition, the federal government must appropriate funds on an annual basis to support DOE contracts, and funding is always subject to unknown and uncontrollable contingencies.

Refined Coal

Revenues in our RC segment totaled $4.7 million and $10.8 million for the three and six months ended June 30, 2011, respectively. There were no similar revenues during the same period in 2010 as the facilities were not placed into routine operations until the end of the second quarter of 2010. RC revenues were lower than in the first quarter of this year due to planned maintenance outages in April and May at the power plants where the RC facilities operate which reduced the amount of coal available for processing. We expect coal processed in the third and fourth quarters of this year to return to the levels we saw in the first quarter. We expect our quarterly revenues to fluctuate based on seasonal variations in electricity demand as well as planned and unplanned outages required by the power plants for equipment repair and maintenance. The first two systems are expected to produce approximately 6 million tons of RC annually, qualifying for the present $6.33 per ton Section 45 tax credit through 2019.

Cost of revenues for the RC segment totaled $413,000 and $588,000 for the three and six months ended June 30, 2011 respectively, as compared to $586,000 and $1.0 million for the same periods in 2010 as we had increased our efforts earlier in 2010 in further developing the technology and modifying the equipment. Costs for the quarter ended June 30, 2011 increased compared to the first quarter of 2011 due to activities undertaken to place additional facilities into operations. Costs of revenues have stabilized as the existing RC facilities have settled into routine operations. We expect future RC margins to be at a level near 95%.

RC segment profits increased by $4.7 million and $10.9 million for the three and six months ended June 30, 2011, respectively, compared to the same periods in 2010 as the two facilities were leased and placed in routine operation in the middle of 2010.

Other Items

General and administrative expenses increased by $671,000 and $909,000 or 11% and 8% to $6.8 million and $11.7 million for the three and six months ended June 30, 2011, respectively, from the same periods in 2010. The change in 2011 resulted primarily from $3.0 million in incentive compensation for employees and consultants we accrued during the three months ended June 30, 2011 related to the equity sale in Clean Coal. These increases were somewhat offset by decreases in legal expenses totaling $2.8 million and $3.5 million for the three months and six months ended June 30, 2011, respectively over the same periods in 2010. Non-routine legal costs related to the Norit matter totaled $ 1.5 million and $3.4 million for the three and six months ended June 30, 2011, respectively. We expect non-routine legal costs to decrease significantly starting in the fourth quarter of 2011 assuming we can resolve the Norit arbitration and related indemnity claims by then. We expect other components of our G&A to increase in 2011 as we build our infrastructure in preparation for the increased market opportunities anticipated from the several MACT regulations.

We incur research and development (“R&D”) expenses not only on direct activities we conduct but also by sharing a portion of the costs in the government and industry programs in which we participate. Total R&D expenses increased by $178,000 and $315,000 or 90% and 83% for the three and six months ended June 30, 2011, respectively, compared to the same periods in 2010 as a result of increases in CC and RC activities. We have had no significant direct cost share for R&D under DOE related contracts so far in 2011 or in 2010. The increase in total R&D is related to preparing for growth in the delivery of our ACI systems, as well as our RC activities. Future consolidated research and development expenses, except for those anticipated to be funded by the DOE contracts and others that may be awarded, are expected to be higher in 2011 as compared to 2010. We continue to anticipate that our future R&D expenses will grow in direct proportion to DOE funded CO2 work we perform for the next several years and other technology development we choose to pursue.

We had net interest and other income and net interest income of $1.5 million and $2.1 million for the three and six months ended June 30, 2011, respectively, as compared to $1.8 million for both the three and six months ended June 30, 2010 due primarily to the interest on notes receivable and other amounts received from NexGen. We recognized $39.5 million in expenses for the six months ended June 30, 2011 related to the interim award in the Norit arbitration as described below and in Part II, Item 1 of this report.

The deferred income tax benefit for the six months ended June 30, 2011 represents our expected effective tax benefit of approximately 37% which approximates our effective tax benefit for 2010. Our income tax rate does not include any material amount of Section 45 tax credits from Clean Coal as those tax benefits will primarily be realized by the lessee under the RC facilities’ leases.

Our net operating loss for the six months ended June 30, 2011 of $29.8 million or $(3.91) per share includes our equity in the losses incurred by Carbon Solutions totaling $1.8 million and $3.8 million for the three and six months ended June 30, 2011, respectively and is included in other income (expense) in the consolidated statement of operations. This amount is reported net of our equity in the net income of CCSS which amounted to $74,000 and $100,000 for the three and six months ended June 30, 2011, respectively. We expect to continue to report our equity in the losses of Carbon Solutions for the balance of the year and future years as sales ramp up and other development activities continue. Our investment in Carbon Solutions has been reduced by our respective share of such losses. We expect to continue to report our equity in the net income of CCSS for the balance of the year as operations become more consistent.

Liquidity and Capital Resources

Working Capital

Our principal sources of liquidity are the proceeds we received from the sale of equity in Clean Coal, our other working capital, and our anticipated cash flow from RC activities and other operations. We had consolidated cash and cash equivalents totaling $41 million at June 30, 2011 as compared to consolidated cash and cash equivalents of $9.7 million at December 31, 2010.

At June 30, 2011, we had a working capital deficit of $588,000 as compared to working capital of $10.1 million at December 31, 2010. Our working capital decreased primarily due to the reclassification from long-term to current of

$32.6 million in liabilities related to the interim Norit matter, partially offset by proceeds from the sale of an effective 15% interest in the equity of Clean Coal to GS. ADA received gross proceeds of $30 million from the sale of Class B units to GS and received an additional amount of $1 million from NexGen representing the remaining payment owed by NexGen in order to maintain its interest in Clean Coal. In addition, we received payment on notes receivable and other receivables from NexGen totaling $2 million We have long-term liabilities recorded totaling $38.5 million which amount includes our present estimate of the long-term liability portion of the interim award related to the Norit matter of $6.9 million, long-term deferred revenue including deferred rental income and other obligations of $2.4 million, and an estimate of indemnity costs related to the Norit award of $29.1 million as of June 30, 2011. Although we had positive operating cash flow for the six months ended June 30, 2011, this trend will likely not continue during the remainder of 2011, depending upon the timing of payments related to the Norit interim award and indemnity costs. We expect Clean Coal to use its $10 million line of credit and cash flow from operations to fund amounts required to construct, install and place additional RC facilities into operation.

Our shareholders’ equity was approximately $2.8 million as of June 30, 2011 compared to $13.4 million as of December 31, 2010. The decrease is primarily due to the expenses recorded related to the Norit interim award offset by the recording, net of related taxes, of the sale of equity in Clean Coal to GS.

Carbon Solutions has funded, through loans and/or equity contributions from ECP to Carbon Solutions, a significant portion of the legal expenses related to the Norit matter. In April 2011, ECP notified us that it believes our indemnity obligations to it and Carbon Solutions totaled approximately $30.7 million, inclusive of the $29.1 million recorded on our balance sheet. In the past ECP has claimed that our indemnity obligations also include any losses it may suffer due to loss of potential customers and diminution in the value of the business, legal costs and fees and any damages it may suffer as a result of a lawsuit Norit International N.V. f/k/a Norit N.V. (“Norit International”) has filed against ECP in state court in New Jersey. Satisfaction of a portion of our indemnity obligations to ECP could be made via a decrease in our recorded capital contributions (and with a corresponding increase in ECP’s capital contributions) in Carbon Solutions and adjustment of each party’s percentage ownership accordingly.

Our ability to generate the financial liquidity required to meet ongoing operational needs and to meet our obligations related to the Norit arbitration and litigation will likely depend upon several factors, including ongoing legal expenses incurred by us (and other parties) in the Norit matters, timing of satisfaction and ultimate amount of payments due to Norit and payment of our indemnity obligations, our ability to maintain a significant share of the market for mercury control equipment, Clean Coal’s continued operation of the two RC facilities placed in service in 2010 and success in monetizing Section 45 tax credits through the sale or lease of additional RC facilities to third party investors and our ability to raise additional financing. Depending upon these factors and further proceedings in the Norit arbitration as to timing of payment of the $37.9 million interim award and possible award of legal fees and costs to Norit, which Norit claims to be $13 million, we may not have sufficient working capital to meet our obligations and may need to seek protection in the courts for our assets by filing a Chapter 11 bankruptcy proceeding. Court protection could allow us to continue to operate our business and provide us with additional time to negotiate or otherwise attempt to restructure our debts. Management believes that given the Company’s options, resolution of the Norit arbitration and payment of obligations to Norit and payment of the other related indemnity obligations to ECP will not prevent the Company from meeting its obligations to customers and vendors and operating its business.

Clean Coal Related Items

Clean Coal, our joint venture with NexGen and GS, has placed two RC production facilities into service, which have been leased to a third party. Based on the amount of RC that we expect will be produced from the RC facilities, we expect to recognize pre-tax tax cash flows between $7 to $10 million per year through 2019, the expected period for which Section 45 tax credits are available for these facilities.

During the second quarter of 2011 and subsequent to the sale of an effective 15% interest in Clean Coal to GS as described above, NexGen completed its obligation to ADA in order to maintain its interest in Clean Coal. In June 2010, NexGen executed $1.8 million in two-year promissory notes with interest at 5% per annum. During the second quarter of 2011 and subsequent to the sale of the interest in Clean Coal to GS as described above, NexGen paid the entire balance due of $3 million plus interest to maintain its interest in Clean Coal.

In addition, ADA, NexGen and two entities affiliated with NexGen have provided Clean Coal’s sublessee with joint and several guaranties guaranteeing any payments and performance due the lessee under the various agreements Clean Coal executed in the lease of the RC facilities.

AC Facility Related Items

As noted above, Carbon Solutions has commenced commercial operations at its AC Facility, which has an estimated all-in, total cost for one production line capable of producing approximately 150 million pounds of AC per year including related activities of approximately $400 million. Red River has received a conditional commitment for up to $245 million from the DOE to guarantee a loan related to the costs of construction of the AC Facility.

In order to address the anticipated capital needs of Carbon Solutions, ECP may fund additional ordinary capital contributions or preferred equity contributions to Carbon Solutions or make loans to Red River, in each case at such times and in such amounts as ECP determines are necessary to satisfy their capital requirements. Neither ADA nor ECP is required to fund additional capital contributions to Carbon Solutions at this time. One-half of ECP’s preferred equity bears a preferred return of 12% per annum, and the other half does not bear a preferred return. ECP is entitled to receive priority distributions on its preferred equity until it is redeemed or converted and has the option to convert any such unredeemed preferred equity into ordinary capital contributions.

Pursuant to an Amended and Restated Credit and Reimbursement Agreement among Red River, ECP and ADA dated as of September 2, 2009 and related documents (the “Carbon Solutions’ Credit Support Documents”), ECP may make loans to Red River from time to time. As of June 30, 2011, the principal balance of ECP’s loans to Red River totaled approximately $175.7 million. Such loans are evidenced by convertible demand promissory notes bearing interest at 12% per annum compounded quarterly. ECP may convert any outstanding amounts due under such notes to ordinary capital or preferred equity contributions in Carbon Solutions at any time at its option. The outstanding loans are secured by Red River’s assets and guaranteed by Carbon Solutions, and Carbon Solutions’ guaranty is secured by a pledge of Carbon Solutions’ equity in Red River. If and when Carbon Solutions is able to place long-term commercial debt, we expect a significant portion, if not all, of its outstanding loans from ECP to be replaced by such debt.

In 2009 and subsequently, ECP has converted some of its then outstanding preferred equity to ordinary capital contributions and made additional ordinary capital contributions, resulting in dilution of our ownership interest in Carbon Solutions to 22.8% as of June 30, 2011. Because of such dilution to date, ECP now elects three out of the four managers of the Board of Carbon Solutions and controls decisions of the Board and the members. We continue to have the right to participate in significant decisions subject to member approval so long as we continue to hold at least a 15% ownership interest. Member approval requires approval of members holding at least 75% of the ownership interests so our approval is no longer required.

In addition to our indemnity obligations described above, we have given guaranties and undertaken other commitments of approximately $28.6 million related to Carbon Solutions. No liabilities associated with such guaranties and obligations were recorded in the financial statements as we do not expect the guaranties and commitments to be called upon. The general contractor for the AC Facility has filed a statement of claim against ADA and Red River and a lien on the AC Facility for $21 million related to a dispute of contract costs. Pursuant to the Carbon Solutions’ Credit Support Documents, Red River has agreed to reimburse us and ECP in the event we or they are required to make payments related to these guaranties and guaranties provided by ECP. Red River’s reimbursement obligations are secured by Red River’s assets and guaranteed by Carbon Solutions, and Carbon Solutions’ guaranty is secured by a pledge of Carbon Solutions’ equity in Red River. We assigned our rights under these agreements to ECP, and any amounts payable to us would be paid directly to ECP until ECP’s preferred equity in Carbon Solutions is fully redeemed or converted and all loans to Red River have been paid in full.

Other Liquidity and Capital Resource Items

Our trade receivables balance is comprised of both amounts billed to customers as well as unbilled revenues that have been recognized. As of June 30, 2011 our trade receivables balance was $6.9 million which was offset by billings in excess of recognized income of $281,000 or a net of $6.7 million as compared to $9.1 million at December 31, 2010.

We recorded approximately $1.7 million in additional potential indemnity obligations to Carbon Solutions related to the running royalty portion of the Norit award. We also recorded approximately $39.5 million in interim award obligations, including both expected current and long-term amounts, related to the Norit matter during the six months ended June 30, 2011 as well as $1.6 million of accrued expenses which resulted in the increase in accrued current liabilities as of June 30, 2011.

Under our defined contribution and 401(k) retirement plan, in 2011 and 2010 we matched up to 7% of salary amounts deferred by employees in the plan. During the six months ended June 30, 2011 and 2010, we recognized $182,000 and $132,000, net of forfeitures, respectively, of matching expense which payments were made with our stock. In the past,

we have also made discretionary contributions to the plan for employees. Thus far in 2011, and in 2010, we did not make any such discretionary contributions. Our matching expense is expected to amount to $300,000 for 2011 depending on employee participation in the plan.

We have recorded net current deferred tax assets of $129,000 and net long-term deferred tax assets of $21.1 million as of June 30, 2011 as compared to net current deferred tax assets of $188,000 and net long-term deferred tax assets of $15.4 million as of December 31, 2010. We believe that it is more likely than not that our deferred tax assets will be realized in the future as we expect significant revenues related to the RC segment over the next several years. The change is largely a result of our loss for the six months ended June 30, 2011.

Cash flow provided by operations totaled $5.9 million for the first six months of 2011 compared to $9.1 million for the same period in 2010. The change in operating cash flow primarily resulted from an increase in accrued arbitration award and other liabilities of $39.5 million, an increase in our accrued indemnity liability of $1.7 million, a decrease in accounts receivable of $2.4 million and an increase in accounts payable and accrued liabilities of $2.2 million which were offset by a decrease in deferred revenue of $2.5 million. These changes in our operating assets and liabilities correspond to the nature and timing of our procurement and billing cycle and development activities. In addition, adjustments related to non-cash operating activities included expenses paid with stock and restricted stock of $636,000, depreciation and amortization of $392,000, non-controlling interest in Clean Coal of $3.8 million and our net minority equity interest which increased our cash flow provided by operations and were offset by an increase in recorded deferred tax benefits of $16.6 million.

Net cash provided by investing activities was $26.6 million for the first six months of 2011 compared to $3.2 million used for investing activities for the same period in 2010. Cash provided by investing activities consisted of payments of $1.6 million received from NexGen related to their notes receivable to us and $30 million equity contribution from the sale of the interest in Clean Coal offset by purchases of equipment and development projects of $5 million. The cash used in 2010 was primarily due to capital expenditures related to our Clean Coal joint venture. The remaining cash used in 2010 was made up of investments in securities and activities related to the development and formation of our investments in other entities.

Net cash used in financing activities was $1.2 million for the first six months of 2011 compared to $273,000 for the same period in 2010. Sources of financing included the net borrowings on the line of credit of $4.2 million and equity contributions of $250,000, offset by distributions by Clean Coal to the non-controlling interest of $5.7 million.

Critical Accounting Policies and Estimates

Revenue Recognition – We follow the percentage of completion method of accounting for all significant contracts excluding government contracts, chemical sales, technology license and related royalties and RC leases. The percentage of completion method of reporting income takes into account the estimated costs to complete and estimated gross margin for contracts in progress. We recognize revenue on government contracts generally based on the time and expenses incurred to date. We are recognizing revenue from the Arch Coal license over the estimated time for which Arch Coal expects to recoup its investment in the technology and the related royalties will be recognized when earned. RC base rents, which are fixed, are recognized over the life of the lease. Contingent rents are recognized as they are earned.

Significant estimates are used in preparation of our financial statements and include:

•

our allowance for doubtful accounts, which is based on historical experience;

•

our warranty costs;

•

our estimate of timing, amount and payment on contingent liabilities;

•

our expectation that it is more likely than not that our deferred tax assets will be realized in the future;

•

our percentage of completion method of accounting for significant long-term contracts, which is based on estimates of gross margins and of the costs to complete such contracts; and

•

the period over which we estimate we will earn up-front license payments.

In addition, amounts invoiced for government contracts are subject to change based on the results of future audits by the federal government. We have not experienced significant adjustments in the past, and we do not expect significant adjustments will be required in the future. We also use our judgment to evaluate the current net book value of goodwill and other intangible assets of $730,000 on our consolidated balance sheets. Management believes the value of other recorded intangibles is not impaired, although market demand for our products and services could change in the future, which could require a write-down in recorded values. As with all estimates, the amounts described above are subject to change as additional information becomes available, although we are not aware of anything that would cause us to believe that any material changes will be required in the near term.

Under certain contracts we may grant performance guaranties or equipment warranties for a specified period and the achievement of certain plant operating conditions. In the event the equipment fails to perform as specified, we are obligated to correct or replace the equipment. Estimated warranty costs are recorded at the time of sale based on current industry factors. The amount of the warranty liability accrued reflects our best estimate of expected future costs of honoring our obligations under the warranty section of each contract. We believe the accounting estimate related to warranty costs is a critical accounting estimate because changes in it can materially affect net income, it requires us to forecast the amount of equipment that might fail to perform in the future, and it requires a large degree of judgment.

Income taxes are accounted for under the asset and liability approach. Under this method, deferred tax assets and liabilities are recognized for the expected future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax bases using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets may be reduced by a valuation allowance if and when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. The change in laws can have a material effect on the amount of income tax we are subject to. We are not aware of anything that would cause us to believe that any material changes will be required in the near term.

We recognize all share-based payments, including grants of stock options, restricted stock units and employee stock purchase rights in our financial statements based upon their respective grant date fair values. Under this standard, the fair value of each employee stock option and employee stock purchase right is estimated on the date of grant using an option pricing model that meets certain requirements. We currently use the Black-Scholes option pricing model to estimate the fair value of our stock options and stock purchase rights. The Black-Scholes model meets the requirements of FASB Topic 718 but the fair values generated by the model may not be indicative of the actual fair values of our equity awards, as it does not consider certain factors important to those awards to employees, such as continued employment and periodic vesting requirements. The determination of the fair value of share-based payment awards utilizing the Black-Scholes model is affected by our stock price and a number of assumptions, including expected volatility, expected life and risk-free interest rate. We use a historical volatility rate on our stock options. The fair value of our restricted stock is based on the closing market price of our Common Stock on the date of grant. If there are any modifications or cancellations of the underlying securities, we may be required to accelerate, increase or cancel any remaining unearned stock-based compensation expense. To the extent that we grant additional equity securities to employees or we assume unvested securities in connection with any acquisitions, our stock-based compensation expense will be increased by the additional unearned compensation resulting from those additional grants or acquisitions.

Consolidation of Subsidiaries – Our equity partner in Carbon Solutions, ECP, contributed equity capital significantly in excess of our contributions. We expect that our ownership percentage may be further diluted below the 22.8% existing as of June 30, 2011 and that we will continue recording our interest under the equity method.

Since inception, ADA has been considered the primary beneficiary of the joint venture with Clean Coal. ADA holds a 50% interest in the Class A voting units of Clean Coal, and we believe our interest and other elements of our participation constitute control of Clean Coal and, therefore, have consolidated its accounts with ours. An affiliate of The Goldman Sachs Group, Inc. holds a non-voting interest in Clean Coal and shares in the profits or losses of the joint venture.

We hold a 50% interest in CCSS. However, we control only two of the five seats on the board of managers and our equity partner controls the other three seats. Therefore, we believe our 50% interest does not constitute control of CCSS and we have recorded our interest under the equity method.

Recently Issued Accounting Policies

There were none issued which were material to our financial statements.

Item 4.

Controls and Procedures.

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and that such information is accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. Management necessarily applied its judgment in assessing the costs and benefits of such controls and procedures, which, by their nature, can provide only reasonable assurance regarding management’s control objectives.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation and under supervision of our Chief Executive Officer and Chief Financial Officer, have reviewed and evaluated the effectiveness of the Company’s disclosure controls and procedures as defined in the Securities Exchange Act of 1934 Rules 13a-15(e) and 15d-15(e), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on their review and evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are adequate and effective to ensure that material information related to our financial statements are made known to them by others in a timely manner, particularly during the period in which this quarterly report on Form 10-Q was being prepared, and that no changes are required at this time.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal controls over financial reporting during the quarter ended June 30, 2011, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1.

Legal Proceedings

Litigation with Norit Americas, Inc. and Norit International N.V. f/k/a Norit N.V. As previously reported in our Annual Reports on Form 10-K for the years ended December 31, 2010 and 2009 and our Quarterly Reports on Form 10-Q filed in 2010 and 2011, Norit, which is an AC manufacturer with whom we have previously done business, filed a lawsuit against us, ADA Environmental Solutions LLC, Carbon Solutions (formerly known as Crowfoot Development, LLC), Red River (now known as ADA Carbon Solutions (Red River), LLC), Underwood Environmental Products, LLC, Morton Environmental Products, LLC and two employees of Carbon Solutions (who were former employees of Norit and who are now employees of Carbon Solutions) (collectively the “ADA Defendants”) on August 4, 2008, asserting that the ADA Defendants misappropriated Norit’s trade secrets related to AC manufacturing, and other claims. The original case, captioned Norit Americas, Inc. v. ADA-ES, Inc., ADA Environmental Solutions, LLC, John Rectenwald, Stephen D. Young, Crowfoot Development, LLC, Red River Environmental Products, LLC, Underwood Environmental Products, LLC, Morton Environmental Products, LLC f/k/a Bowman Environmental Products, LLC, Cause No. 08-0673, was filed in the 71st Judicial District Court for Harrison County, Texas. Norit was seeking monetary damages under various legal theories, attorneys’ fees, and injunctive relief to prevent us or any related entity or third party from using Norit’s alleged trade secrets or other Norit intellectual property related to AC manufacturing. As previously reported, after more than a year of litigation in Texas and the filing of cross motions to compel arbitration of all or some of the claims pending between the parties, the parties agreed to resolve all claims between them in an arbitration in Atlanta, Georgia before a panel of three arbitrators under the rules of the American Arbitration Association. In the course of the arbitration, the ADA Defendants and Norit filed statements of claims which added additional claims against each other arising out of their former business relationship including a claim by Norit against ADA for breach of a non-solicitation provision in a Market Development Agreement (“MDA”), which ADA and Norit were parties from 2001 until 2006.

On April 8, 2011, the arbitration panel issued an interim award holding ADA liable for approximately $37.9 million in damages for breach of a non-solicitation provision of the MDA, and further holding ADA jointly and severally liable together with several other ADA Defendants for payment of a royalty of 10.5% for 3 years and then 7% for an additional 5 years on the sales of activated carbon from the production facility owned by Red River in which the Company indirectly holds a minority interest, for misappropriation of certain Norit claimed trade secrets.

Following the interim award noted above, Norit submitted a claim to the arbitration panel to recover $13 million in attorneys’ fees and costs allegedly incurred on claims on which Norit prevailed. The ADA Defendants are contesting Norit’s claim for attorneys’ fees and costs. The parties submitted in May and June briefs addressing Norit’s claims for attorneys’ fees and costs and the unresolved issues from the interim award related to the administration of the royalty and timing of payments for the damages for breach of the non-solicitation provision of the MDA. In its submissions, Norit has also requested that the panel impose restraints on the disposition of the ADA Defendants’ assets both to secure the payment of obligations imposed by a final award, and to restrain the disposition of the ADA Defendants’ and ECP’s interests in the AC production facilities incorporating Norit’s trade secrets. The ADA Defendants have contested any such restraints.

The arbitration panel was scheduled to meet on August 4, 2011 to hear arguments from the parties regarding Norit’s request for attorneys’ fees and costs and restraints on disposition of interests in the AC production facilities and the various issues related to the administration of the running royalty including timing of payments for the damages for breach of the non-solicitation provisions of the MDA. The parties have mutually agreed to postpone the hearing to September 1, 2011.

Approximately $1.6 million has been recorded for the six months ended June 30, 2011 related to the expected liability through the end of 2011 regarding the royalty payments. Future royalty payments cannot be reasonably estimated at this time.

As also previously reported in our Annual Reports on Form 10-K for the fiscal years ended December 31, 2010 and 2009 and our Quarterly Reports on Form 10-Q filed in 2010 and 2011, in December, 2009, Norit International, the Dutch parent of Norit, filed a petition with the Almelo District Court in the Netherlands requesting that the court conduct preliminary witness examinations into possible breaches of a confidentiality agreement we signed with Norit International in 2005 as part of due diligence for a potential acquisition of Norit’s carbon business. These alleged breaches of the 2005 confidentiality agreement are also the subject of the arbitration in Atlanta and so it is our position that the petition in the Netherlands is a duplicative matter now rendered moot by the interim award. The petition, which is a pre-litigation procedure in the Netherlands designed to determine if there is a basis to bring a claim, does not require any direct response by us and is currently pending before the Dutch court. As of this date, no witness statements have been taken in the matter and to our knowledge, the Dutch court has not made any findings with respect to the matter.

In July we received notice that the Dutch court has requested that depositions of certain witnesses be taken in the United States and a Court in Texas has ordered that a deposition of one individual in Texas may proceed. No depositions have been scheduled however, and it appears that the process of requesting this deposition by the Dutch Court commenced before the interim decision of the arbitration panel. We have attempted to determine if the Dutch court has been properly advised by Norit International of the status of the arbitration but have been unable to confirm that the Dutch Court has been properly advised of this.

Item 1A

Risk Factors

In addition to the Risk Factors disclosed in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2010 and in Part II, Item 1A of the Company Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, we face certain additional material risks. Such additional risks are set forth below:

This list of risks is not intended to be exhaustive, but reflects what we believe are the material risks inherent in our business and the ownership of our securities as of the date of this Report. A statement to the effect that the happening of a specified event may have a negative impact on our business, results of operations, profitability, financial condition, or the like, is intended to reflect the fact that such an event would be likely to have a negative impact on your investment in the Company, but should not imply the likelihood of the occurrence of such specified event.

WE MAY NOT HAVE SUFFICIENT WORKING CAPITAL TO PAY OUTSTANDING AND POTENTIAL FUTURE OBLIGATIONS

As previously discussed and disclosed, following the interim award, Norit submitted a claim to the arbitration panel to recover $13 million in attorneys’ fees and costs allegedly incurred on claims on which Norit prevailed. If the arbitration panel finds ADA liable for any or all of Norit’s attorneys’ fees and costs, we may have additional significant payment obligations. Furthermore, in its submissions, Norit has requested that the panel impose restraints on the disposition of the ADA Defendants’ assets both to secure the payment of obligations imposed by a final award, and to restrain the disposition of the ADA Defendants’ and ECP’s interests in the AC production facilities incorporating Norit’s trade secrets. If the arbitration panel imposes a restraint on the disposition of the ADA Defendants’ and ECP’s interest in the AC production facilities, this could adversely impact the value of Carbon Solutions. As previously disclosed, ECP has notified us that it believes ADA is obligated to indemnify it for any losses it suffers due to diminution in the value of its business, which could include any diminution in the value of its investment in Carbon Solutions. In addition to the other liabilities previously disclosed in regard to the Norit arbitration, such diminution in the value of its investment could be substantial, and, if substantial and payment were required, it would likely have a material adverse effect on our business and financial condition.

Item 6.

Exhibits


10.33**		Second Amended and Restated Operating Agreement of Clean Coal Solutions, LLC dated May 27, 2011, by and among Clean Coal Solutions, LLC, ADA-ES, Inc., GSFS Investments I Corp. and NexGen Refined Coal, LLC.

10.84**		Exclusive Right to Lease Agreement dated May 27, 2011 between Clean Coal Solutions, LLC and GSFS Investments I Corp.

10.85**		Class B Unit Purchase Agreement dated May 27, 2011 between Clean Coal Solutions, LLC and GSFS Investments I Corp.

10.86		ADA-ES, Inc. Guaranty for the benefit of GSFS Investments I Corp. dated May 27, 2011.

10.87		Contribution Agreement dated May 27, 2011 between ADA-ES, Inc. and NexGen Refined Coal, LLC.

31.1*		Certification of Chief Executive Officer of ADA-ES, Inc. Pursuant to 17 CFR 240.13a-14(a) or 17 CFR 240.15d-14(a).

31.2*		Certification of Chief Financial Officer of ADA-ES, Inc. Pursuant to 17 CFR 240.13a-14(a) or 17 CFR 240.15d-14(a).

32.1*		Certification of Chief Executive Officer of ADA-ES, Inc. Pursuant to 18 U.S.C Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2*		Certification of Chief Financial Officer of ADA-ES, Inc. Pursuant to 18 U.S.C Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101*		The following financial statements, formatted in XBRL: (i) Consolidated Balance Sheets as of June 30, 2011 and December 31, 2010, (ii) Consolidated Statements of Operations for the six months ended June 30, 2011 and 2010, (iii) Consolidated Statements of Cash Flows for the six months ended June 30, 2011 and 2010; and (iv) Notes to the Unaudited Consolidated Financial Statements, tagged as blocks of text. The information in Exhibit 101 is ”furnished” and not “filed”, as provided in Rule 402 of Regulation S-T.

*	These certifications are “furnished” and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

**	Portions of this exhibit have been omitted pursuant to a request for confidential treatment.

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the Registrant caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


				ADA-ES, Inc.
				Registrant

Date: August 12, 2011				/s/ Michael D. Durham
				Michael D. Durham
				President and Chief Executive Officer

Date: August 12, 2011				/s/ Mark H. McKinnies
				Mark H. McKinnies
				Chief Financial Officer

EXHIBIT INDEX


10.33**		Second Amended and Restated Operating Agreement of Clean Coal Solutions, LLC dated May 27, 2011, by and among Clean Coal Solutions, LLC, ADA-ES, Inc., GSFS Investments I Corp. and NexGen Refined Coal, LLC.

10.84**		Exclusive Right to Lease Agreement dated May 27, 2011 between Clean Coal Solutions, LLC and GSFS Investments I Corp.

10.85**		Class B Unit Purchase Agreement dated May 27, 2011 between Clean Coal Solutions, LLC and GSFS Investments I Corp.

10.86		ADA-ES, Inc. Guaranty for the benefit of GSFS Investments I Corp. dated May 27, 2011.

10.87		Contribution Agreement dated May 27, 2011 between ADA-ES, Inc. and NexGen Refined Coal, LLC.

31.1*		Certification of Chief Executive Officer of ADA-ES, Inc. Pursuant to 17 CFR 240.13a-14(a) or 17 CFR 240.15d-14(a).

31.2*		Certification of Chief Financial Officer of ADA-ES, Inc. Pursuant to 17 CFR 240.13a-14(a) or 17 CFR 240.15d-14(a).

32.1*		Certification of Chief Executive Officer of ADA-ES, Inc. Pursuant to 18 U.S.C Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2*		Certification of Chief Financial Officer of ADA-ES, Inc. Pursuant to 18 U.S.C Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101*		The following financial statements, formatted in XBRL: (i) Consolidated Balance Sheets as of June 30, 2011 and December 31, 2010, (ii) Consolidated Statements of Operations for the six months ended June 30, 2011 and 2010, (iii) Consolidated Statements of Cash Flows for the six months ended June 30, 2011 and 2010; and (iv) Notes to the Unaudited Consolidated Financial Statements, tagged as blocks of text. The information in Exhibit 101 is ”furnished” and not “filed”, as provided in Rule 402 of Regulation S-T.

*	These certifications are “furnished” and shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

**	Portions of this exhibit have been omitted pursuant to a request for confidential treatment.

Exhibit 10.33

EXECUTION VERSION

CLEAN COAL SOLUTIONS, LLC

SECOND AMENDED AND RESTATED OPERATING AGREEMENT

Dated as of May 27, 2011

THE UNITS ISSUED UNDER THIS OPERATING AGREEMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER ANY APPLICABLE STATE SECURITIES LAWS (THE “STATE ACTS”). SUCH UNITS MAY NOT BE SOLD, ASSIGNED, PLEDGED OR OTHERWISE DISPOSED OF AT ANY TIME WITHOUT EFFECTIVE REGISTRATION UNDER THE ACT OR PURSUANT TO AN EXEMPTION FROM THE ACT AND THE APPLICABLE STATE ACTS, AND COMPLIANCE WITH THE OTHER RESTRICTIONS ON TRANSFERABILITY SET FORTH HEREIN, INCLUDING (WITHOUT LIMITATION) THE PROVISIONS OF ARTICLE IX.

*	Indicates portions of the exhibit that have been omitted pursuant to a request for confidential treatment. The non-public information has been separately filed with the Securities and Exchange Commission.

TABLE OF CONTENTS


Article I	DEFINITIONS AND RULES OF CONSTRUCTION	6
1.1	Definitions.	6
1.2	Rules of Construction.	18

Article II	FORMATION OF THE COMPANY	19
2.1	Name and Formation	19
2.2	Operating Agreement	19
2.3	Principal Place of Business; Qualification	19
2.4	Registered Office and Registered Agent	19
2.5	Term	19
2.6	Purposes and Powers.	20
2.7	Default Rules Under the Act	20
2.8	Existing LLC Agreement	20
2.9	Title to Property	20
2.10	Intent	20

Article III	CAPITAL CONTRIBUTIONS AND ACCOUNTS; ADJUSTMENT OF SHARING RATIOS	21
3.1	Initial Capital Contributions and Ownership Structure.	21
3.2	Additional Capital Contributions; Adjustment of Sharing Ratios and Units.	22
3.3	Failure to Make a Required Additional Capital Contribution.	23
3.4	No Third Party Right to Enforce	24
3.5	Capital Accounts.	24
3.6	No Interest on Capital	25
3.7	Creditor’s Interest in Company	25
3.8	Return of Capital	25
3.9	Distributions In-Kind	26
3.10	Transfer of Capital Accounts	26

Article IV	ALLOCATIONS AND DISTRIBUTIONS	26
4.1	Allocations	26
4.2	Special Allocations.	26
4.3	Offsetting Allocations.	28
4.4	Tax Allocations	28
4.5	Distributions.	29
4.6	Incorrect Payments	34
4.7	Limitation Upon Distributions	34
4.8	Profit Sharing Program	35
4.9	Withholding and Indemnification for Payments on Behalf of a Member	35


Article V	BOARD OF MANAGERS; POWERS AND DUTIES OF MANAGERS; APPOINTMENT OF OFFICERS	36
5.1	Board of Managers.	36
5.2	Actions by Board.	38
5.3	Stalemate	40
5.4	Appointment of Committees and Officers	41
5.5	Compensation	41
5.6	Board Decisions	41
5.7	Exculpation; Limitation of Liability	43
5.8	Reliance	43

Article VI	MEMBERS; TYPES OF UNITS; ISSUANCE OF UNITS AND OPTIONS TO PURCHASE UNITS	44
6.1	Authority and Power	44
6.2	Voting; Approval of the Members	46
6.3	Limitation of Liability	46
6.4	Actions by Members	47
6.5	Authorized Units; Modification of Units; Issuance of Additional Units; Admission of Additional Members	49
6.6	Preemptive Rights.	49
6.7	Rights Attributable to Units	50
6.8	Certificates Representing Units	50
6.9	Restrictions on Transfer	51
6.10	Effect of a Non-payment Election by NexGen	51
6.11	Compensation and Reimbursement of Members	51
6.12	Force Majeure	52

Article VII	RECORDS, FINANCIAL STATEMENTS, TAX MATTERS, AND FISCAL YEAR	52
7.1	Records	52
7.2	Financial Statements	53
7.3	Tax Matters	53
7.4	Bank Accounts	56

Article VIII	DISSOLUTION AND LIQUIDATION	56
8.1	Dissolution.	56
8.2	Liquidation.	57
8.3	Compliance with the Act	57

Article IX	TRANSFERS OF UNITS; PURCHASE AND SALE RIGHTS; REDEMPTION	58
9.1	Permitted Transfers	58
9.2	Purchase Right Upon Attempted Transfer	58
9.3	Tag-Along Rights	60
9.4	Drag-Along Rights.	63
9.5	Redemption	65

iii


Article X	INDEMNIFICATION	65
10.1	Indemnification by Company.	65
10.2	Indemnification by the Parties	67

Article XI	MISCELLANEOUS PROVISIONS	70
11.1	Notices	70
11.2	Application of Colorado Law	72
11.3	No Action for Partition	72
11.4	Amendment of Articles or this Agreement	72
11.5	Binding Effect	72
11.6	Counterparts	72
11.7	Dates	72
11.8	Confidentiality.	72
11.9	Covenant Not to Compete; Business Opportunities.	75
11.10	Limitation on Liability	76
11.11	Invalidity of Provisions	76
11.12	Representations and Warranties.	76
11.13	Expenses	77
11.14	Public Announcements	77
11.15	Entire Agreement	78
11.16	Additional Agreements with GS	78
11.17	Operation and Distributions of Subsidiaries of the Company	78

Exhibits and Schedules


Exhibit A		Unit Ownership and Sharing Ratios
Exhibit B		Addresses of Members
Exhibit C		Chemicals and Additives
Exhibit D		Technical Engineering Services
Schedule 4.5(a)		Pre-Closing Cash Calculation
Schedule 4.5(b)		Calculation of Projected Distributable Value
Schedule 5.1(c)		Managers
Schedule 6.11(a)		Arrangements with Affiliates

SECOND AMENDED AND RESTATED OPERATING AGREEMENT

OF CLEAN COAL SOLUTIONS, LLC

This Second Amended and Restated Operating Agreement of Clean Coal Solutions, LLC is made and entered into to be effective as of May 27, 2011 (the “ Effective Date ”), by and among ADA-ES, Inc., a Colorado corporation (“ ADA ”), NexGen Refined Coal, LLC, a Wyoming limited liability company (“ NexGen ”), GSFS Investments I Corp., a Delaware corporation (“ GS ”), as members (each individually a “ Member ” and collectively the “ Members ”), and Clean Coal Solutions, LLC, a Colorado limited liability company (the “ Company ”). ADA, NexGen, GS and the Company are hereinafter sometimes referred to each individually as a “ party ” and collectively as the “ parties .”

RECITALS:

A. ADA formed the Company on October 31, 2006, under the name “ADA-NexCoal, LLC” pursuant to the laws of the State of Colorado for the purpose of engaging in the Chemicals Business and the Section 45 Business described herein.

B. The Company changed its name to “Clean Coal Solutions, LLC” on January 1, 2007.

C. ADA, NexGen and the Company are parties to that certain Amended and Restated Operating Agreement of the Company, dated as of November 3, 2006 (the “ Existing LLC Agreement ”).

D. Prior to entry into this Agreement (as hereinafter defined) and the other Transaction Agreements (as hereinafter defined) and consummation of the transactions contemplated hereby and thereby, ADA and NexGen each owned fifty (50) Units of membership interests in the Company, representing in the aggregate one hundred percent (100%) of the Company’s fully diluted equity.

E. The Company and GS are entering into that certain Class B Unit Purchase Agreement on the date hereof (the “ Purchase Agreement ”) pursuant to which the Company will issue and sell to GS, and GS will purchase from the Company, Class B Units (as hereinafter defined) representing fifteen and fifteen-nineteenths percent (15 15/19%) of the Company’s fully diluted equity, all in accordance with, and subject to the conditions set forth in, the Purchase Agreement.

F. NexGen, ADA and GS have agreed to amend and restate the Existing LLC Agreement to set forth their mutual understanding and agreement regarding the matters set forth herein, and in connection with such amendment and restatement of the Existing LLC Agreement, the Units owned by ADA and NexGen prior to the Effective Date will be cancelled and exchanged for Class A Units (as hereinafter defined) in accordance with the terms of this Agreement.

ARTICLE I

DEFINITIONS AND RULES OF CONSTRUCTION

1.1 Definitions .

The terms defined in this Article I , wherever used and capitalized in this Agreement, have the meanings set forth below. Certain other capitalized terms are defined in the text of this Agreement in the Sections where such terms are first used, and such definitions shall apply throughout this Agreement wherever such terms are used.

“ AAA ” has the meaning given such term in Section 5.3 .

“ Accounting Firm ” has the meaning given such term in Section 7.3(a)(i) .

“ Act ” shall mean the statutes governing limited liability companies in the State of Colorado, which, as of the Effective Date, is Chapter 80 of Title 7 of the Colorado Revised Statutes, as the same may be in effect from time to time.

“ Action ” means any action, suit, proceeding, claim, arbitration, or investigation.

“ ADA ” has the meaning given such term in the preamble hereof.

“ ADA Guarantee ” means the Guarantee, dated as of May 27, 2011, between ADA and GS in the form attached as Exhibit F to the Purchase Agreement.

“ ADA Managers ” has the meaning given such term in Section 5.1(c) .

“ Adjusted Capital Account Deficit ” means, with respect to any Capital Account as of the end of any Fiscal Year, the amount by which the balance in such Capital Account is less than zero. For this purpose, a Person’s Capital Account balance shall be (i) reduced by any items described in Treasury Regulation Section 1.704 1(b)(2)(ii)(d)(4), (5), and (6) with respect to such Member, and (ii) increased by any amount such Person is obligated to contribute or is treated as being obligated to contribute to the Company pursuant to Treasury Regulation Sections 1.704 1(b)(2)(ii)(c) (relating to partner liabilities to a partnership), 1.704 2(g)(1) (relating to Minimum Gain) and 1.704-2(i) (relating to partner nonrecourse debt minimum gain).

“ Affiliate ” of any Person means any other Person, directly or indirectly, Controlling, Controlled by or under common Control with such particular Person.

“ Agreement ” means this Second Amended and Restated Operating Agreement of the Company, as adopted on the Effective Date and as the same may be further amended or restated from time to time.

“ Appraiser ” has the meaning given such term in Section 9.2(d) .

“ Appraised Value ” has the meaning given such term in Section 9.2(d) .

“ Articles ” has the meaning given such term in Section 2.1 .

“ Bankruptcy ” means the filing by a Person of a petition commencing a voluntary case under any Bankruptcy Law; a general assignment by a Person for the benefit of such Person’s creditors; an admission in writing by a Person of its inability to pay such Person’s debts as they become due; the seeking or acquiescence by a Person in the appointment of any trustee, receiver, or liquidator for the Person or for any part of the Person’s property; or the commencement against a Person of an involuntary case under any Bankruptcy Law, or a proceeding under any receivership, composition, readjustment, liquidation, insolvency, dissolution or similar law or statute, if not dismissed or vacated within sixty (60) days.

“ Bankruptcy Law ” means Title 11 of the United States Code, 11 U.S.C. §§ 101 et. seq. , or any similar federal or state law.

“ Board Decision Threshold ” means *.

“ Board Observer ” has the meaning given such term in Section 5.1(d) .

“ Board of Managers ” or “ Board ” means the Managers appointed pursuant to Section 5.1(c) .

“ Book Value ” means, with respect to any asset of the Company, the asset’s adjusted basis for federal income tax purposes, except that the Book Value of all assets of the Company may be adjusted to equal their respective fair market values, in accordance with the rules set forth in Treasury Regulations Section 1.704-1(b)(2)(iv)(f) immediately prior to: (i) the date of the acquisition of any additional Units or other equity interest in the Company by any new or existing Member in exchange for more than a de minimis capital contribution to the Company; (ii) the date of the distribution of more than a de minimis amount of assets of the Company to a Member; (iii) the date any Unit(s) or other equity interest in the Company is relinquished to the Company; provided, however, that adjustments pursuant to clauses (i) , (ii) and (iii) above shall be made only if the Board reasonably determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Members. The initial Book Value of any asset contributed (or deemed contributed under Treasury Regulations Section 1.704-1(b)(1)(iv)) by a Member to the Company will be the fair market value of the asset at the date of its contribution thereto. If the Book Value of any Company asset is adjusted pursuant to clauses (i) - (iii) above, such Book Value shall thereafter be adjusted for depreciation taken into account with respect to such property for purposes of computing Profits and Losses and other items allocated pursuant to Article IV .

“ Business ” has the meaning given such term in Section 2.6(a) .

“ Capital Account ” means the capital account maintained for a Member pursuant to Section 3.5(a) .

“ Capital Call ” has the meaning given such term in Section 3.2(a) .

“ Capital Contribution ” means any contribution by a Member to the capital of the Company in cash or property whenever made. The value of Capital Contributions other than those made in cash shall be the fair market value of the property contributed to the capital of the Company, as determined by the Board in good faith.

“ Chairman ” means the Member elected as Chairman of a Members’ meeting in accordance with Section 6.4(a)(ii) .

“ Change of Control ” means (i) any transaction or series of related transactions (including a merger, consolidation or other reorganization) pursuant to or as a result of which the holders of Units immediately prior to such transaction or series of related transactions (and their Affiliates) no longer hold Units representing a majority of the Company’s outstanding voting power immediately following such transaction or series of related transactions, (ii) the sale, lease, exclusive license or other Transfer by the Company or any Subsidiary of the Company of all or substantially all of the assets of the Company and its Subsidiaries (taken as a whole) in any transaction or series of related transactions, or (iii) a NexGen Change of Control occurring on or before December 31, 2012 to which GS has not consented pursuant to Section 6.1(b)(ix) .

“ Chemicals and Additives ” means the chemicals and additives set forth in Exhibit C .

“ Chemicals Business ” means the business of marketing and selling Chemicals and Additives and Technical Engineering Services, in each case specifically pertaining to NOx and mercury emissions controls from cyclone coal-fired boilers.

“ Claim Notice ” has the meaning given such term in Section 10.2(b) .

“ Class A Unit ” means a Unit having the rights and obligations specified with respect to Class A Units in this Agreement. The Class A Units are Voting Units.

“ Class A Member ” means a Member holding Class A Units.

“ Class B Unit ” means a Unit having the rights and obligations specified with respect to Class B Units in this Agreement. The Class B Units are Non-voting Units.

“ Class B Member ” means a Member holding Class B Units.

“ Code ” means the Internal Revenue Code of 1986, as amended from time to time. All references to particular sections of the Code shall be deemed to include reference to corresponding provisions of subsequent federal tax law.

“ Company ” has the meaning given such term in the preamble hereof.

“ Company Option Period ” has the meaning given such term in Section 9.2(a) .

“ Confidential Information ” has the meaning given such term in Section 11.8(a) .

“ Control ” means the possession, directly or indirectly, of the power to direct, or cause the direction of, the management and policies of a Person whether through the ownership of voting securities, by contract or otherwise. The terms “Controlled” and “Controlling” shall have correlative meanings.

“ Damages ” has the meaning given such term in Section 10.1(a) .

“ Deemed Sale ” has the meaning given such term in Section 3.1(b) .

“ Default Amount” has the meaning given such term in Section 3.3 .

“ Default Rule ” means a provision of the Act that would apply to the Company or the Members unless otherwise provided in, or modified by, this Agreement.

“ Defaulting Member ” has the meaning given such term in Section 3.3 .

“ Determined Values ” has the meaning given such term in Section 4.5(b)(iii) .

“ Direct Claim Notice ” has the meaning given such term in Section 10.2(g) .

“ Disability ” means, unless otherwise defined in an employment or similar agreement between an individual and the Company or a Subsidiary of the Company, the physical or mental impairment to the extent that the individual in question becomes unable, despite any reasonable accommodation required by Law, to perform the essential functions of his or her position with the Company, including his or her role as a Manager.

“ Disputed Calculations ” has the meaning given such term in Section 4.5(b)(ii) .

“ Distributable Cash ” means, with respect to any period prior to the dissolution of the Company, all cash and cash equivalents received by the Company or any of its Subsidiaries during such period (including proceeds of any Indebtedness incurred by the Company or any of its Subsidiaries that are to be, and have not yet been as of the date of measurement, Distributed to the Members), less an amount of cash necessary for the Company to service and repay its debt obligations as determined by the Board in good faith.

“ Distributable Value ” means the sum of the pre-tax value, determined in accordance with Schedule 4.5(b) , of any allocated Tax Credits, Distributable Cash or other property to be Distributed by the Company to its Members.

“ Distribution ” means each distribution of Distributable Value or Company assets made by the Company to a Member, whether by liquidating distribution, redemption, repurchase or otherwise; provided, however, that none of the following shall be a Distribution: any pro rata exchange of outstanding equity interests of the Company for newly issued equity interests of the Company, and any subdivision (by Unit split or otherwise) or any combination (by reverse Unit split or otherwise) of any outstanding Units. “Distributed” and other forms of the word “Distribute” shall have correlative meanings.

“ Distribution Calculations ” has the meaning given such term in Section 4.5(b)(ii) .

“ Drag-Along Proceeds ” has the meaning given such term in Section 9.4(c)(ii) .

“ Drag-Along Sale ” has the meaning given such term in Section 9.4(a) .

“ Effective Date ” has the meaning given such term in the preamble hereto.

“ Excess Liquidation Preference ” has the meaning given such term in Section 4.5(c)(i) .

“ Excluded Member ” means a Member who is not an “accredited investor,” as such term is defined under the Securities Act.

“ Existing LLC Agreement ” has the meaning given such term in the recitals hereto.

“ Existing Units ” has the meaning given such term in Section 3.1(a) .

“ Facility ” means a Refined Coal production facility.

“ Fiscal Quarter ” means each calendar quarter ending March 31, June 30, September 30 and December 31, or such other quarterly accounting period as may be established by the Board.

“ Fiscal Year ” means the Company’s fiscal year, which shall end on December 31 of each year unless otherwise determined by the Board.

“ Force Majeure ” means an act of God, war, terrorism, hostilities, riot, fire, explosion, accident, flood or sabotage; lack of adequate fuel, power, raw materials, containers or transportation for reasons beyond the affected party’s reasonable control; labor trouble, strike, lockout or injunction (provided that neither party shall be required to settle a labor dispute against its own best judgment); compliance with governmental Laws or orders requiring unreasonable effort or expense; breakage or failure of machinery or apparatus; or any other cause whether or not of the class or kind enumerated above, including a severe economic decline or recession, which prevents or materially delays the performance of this Agreement in any material respect arising from or attributable to acts, events, non-happenings, omissions or accidents beyond the reasonable control of the party affected; provided, however, that Force Majeure shall not relieve any party of the obligation to make any payments required hereunder unless such event affects normal banking transactions.

“ GAAP ” means United States generally accepted accounting principles, consistently applied and as in effect from time to time.

“ GS ” has the meaning given such term in the preamble hereto.

“ GS Calculations ” has the meaning given such term in Section 4.5(b)(iii) .

“ GS Investment Amount ” means $60,000,000.00.

“ Indebtedness ” means, with respect to the Company or any Subsidiary: (i) any indebtedness of the Company or such Subsidiary for borrowed money or issued in substitution for or exchange of indebtedness for borrowed money (including interest and prepayment penalties or obligations); (ii) obligations of the Company or such Subsidiary evidenced by any note, bond, debenture or similar instrument; (iii) obligations by which the Company or such Subsidiary assures a creditor against loss (including contingent reimbursement liabilities with respect to letters of credit); (iv) obligations of the Company or such Subsidiary in respect of any hedging transaction or any financial hedge; and (v) any guarantee of Indebtedness in any manner by the Company or such Subsidiary (including guarantees in the form of an agreement to repurchase or reimburse); provided, however, that trade payables incurred in the ordinary course of business by the Company or any Subsidiary shall not constitute Indebtedness for any purpose hereunder; provided further, that the drawing or redrawing of Indebtedness under a revolving or similar credit facility that is in effect as of the Effective Date, or a revolving credit or similar facility that has received Board and Member approval in accordance herewith prior to such drawing or redrawing, shall not be considered incurrence of Indebtedness for any purpose hereunder, including for purposes of any consent or approval required prior to incurring Indebtedness; and provided further, that the granting of any guarantee or indemnification by the Company or any Subsidiary of the Company in connection with any monetization transaction in connection with the Business of the Company shall not be considered Indebtedness for any purpose hereunder.

“ Indemnified Losses ” means any losses, claims, damages, liabilities, obligations, fines, penalties, judgments, settlements, costs, expenses, and disbursements (including reasonable attorneys’ fees and expenses), but excluding any special, consequential, exemplary or punitive damages, unless such damages are paid by an Indemnitee to a third party in connection with a Third Party Claim.

“ Indemnitee ” has the meaning given such term in Section 10.2 .

“ Indemnitor ” has the meaning given such term in Section 10.2 .

“ Investor Indemnified Party ” has the meaning given such term in the Purchase Agreement.

“ Know-How ” means technical information, ideas, concepts, confidential information, trade secrets, know-how, discoveries, inventions, processes, methods, formulas, source and object codes, data, programs, other works of authorship, improvements, developments, designs and techniques related to the reduction of NOx and mercury emissions from cyclone coal-fired boilers other than as embodied in the Patents, that are owned or controlled by ADA and that are necessary or desirable to use the Patents in the Chemicals Business or the Section 45 Business.

“ Law ” means any foreign or domestic law, order, writ, judgment, action, injunction, decree, ordinance, award, stipulation, statute, judicial or administrative doctrine, rule, regulation or legally enforceable guidance or legally enforceable interpretation of a governmental authority.

“ License Agreement ” means that certain Amended and Restated License Agreement, dated as of October 30, 2009, by and between ADA and the Company pursuant to which ADA granted the Company an exclusive, royalty-free license to use the Licensed Property, as the same may be amended or restated from time to time.

“ Licensed Property ” means any products or methods related to the reduction of NOx and mercury emissions from cyclone coal-fired boilers, whether owned by ADA or licensed by ADA that are (i) covered by any Valid Claims(s) contained in any of the Patents, and/or (ii) based on the products, processes or methods developed using the Technology.

“ Lien ” means any mortgage, deed of trust, lien (statutory or otherwise), pledge, hypothecation, charge, deposit arrangement, preference, priority, security interest, option, right of first refusal or other transfer restriction or encumbrance of any kind (including preferential purchase rights, conditional sales agreements or other title retention agreements, and the filing of or agreement to give any financing statement under the Uniform Commercial Code or comparable Law of any jurisdiction to evidence any of the foregoing).

“ Liquidation Event ” means (i) a liquidation, dissolution or winding up, whether voluntary or involuntary, of the Company, or (ii) a Change of Control.

“ Liquidation Preference ” has the meaning given such term in Section 4.5(c)(i) .

“ Make-Whole Payment ” has the meaning given such term in Section 4.5(c)(i) .

“ Manager ” or “ Managers ” has the meaning given such term in Section 5.1(a) .

“ Member ” or “ Members ” means each of the Persons named as a Member in the introductory paragraph hereof, so long as such Person is the owner of one or more Units, and shall include (i) Persons acquiring newly issued Units as authorized herein, (ii) those Persons acquiring Units after the Effective Date who have succeeded to all or part of the Units as a Permitted Transferee pursuant to this Agreement, and (iii) any other Person admitted as a Member pursuant to Section 6.5 . The Members and their respective Unit ownership and Sharing Ratios are as set forth in Exhibit A , as the same may be updated or amended from time to time.

“ Member Option Period ” has the meaning given such term in Section 9.2(b) .

“ NexGen ” has the meaning given such term in the preamble hereof.

“ NexGen Change of Control ” means (i) any transaction or series of related transactions (including a merger, consolidation or other reorganization) pursuant to or as a result of which the holders of equity interests in NexGen immediately prior to such transaction or series of related transactions (and their Affiliates) no longer hold equity interests in NexGen representing a majority of NexGen’s outstanding voting power immediately following such transaction or series of related transactions or (ii) the sale, lease, exclusive license or other Transfer by NexGen of all or substantially all of the assets of NexGen in any transaction or series of related transactions.

“ NexGen Guarantee ” means the Guarantee, dated as of May 27, 2011, between NexGen and GS in the form attached as Exhibit F to the Purchase Agreement.

“ NexGen Managers ” has the meaning given such term in Section 5.1(c) .

“ NexGen Purchase Agreement ” means that certain Purchase and Sale Agreement, dated as of November 3, 2006 and amended as of October 26, 2009, by and among ADA and NexGen, as the same may be amended or restated from time to time.

“ Non-Defaulting Members ” has the meaning given such term in Section 3.3 .

“ Non-payment Election ” has the meaning given such term in the NexGen Purchase Agreement.

“ Non-transferring Member ” has the meaning given such term in Section 9.2(a) .

“ Non-voting Units ” means Units that have no associated voting rights and represent only an economic interest in the Company and the consent rights expressly set forth herein, including Class B Units.

“ Non-voting Member ” means a Person owning no Units other than Non-voting Units and which Person has been admitted as a Member of the Company in accordance with all requirements of this Agreement.

“ Notice Period ” has the meaning given such term in Section 10.2(b) .

“ Officer ” means a Person appointed as an officer of the Company by the Board pursuant to Section 5.4(a) .

“ Option Units ” has the meaning given such term in Section 9.2 .

“ Organizational Documents ” means this Agreement and the Articles, in each case as the same may be amended or restated from time to time in accordance with the terms hereof.

“ Participating Member ” has the meaning given such term in Section 3.3 .

“ party ” or “ parties ” has the meaning given such term in the preamble hereof.

“ Patents ” means (i) U.S. Patent No. 6,773,471 B2 entitled “Low Sulfur Coal Additive for Improved Furnace Operation” issued on August 10, 2004; (ii) U.S. Patent No. 6,729,248 B2 entitled “Low Sulfur Coal Additive for Improved Furnace Operation” issued on May 4, 2004; (iii) Patent Application No. 10/209,083 entitled “Low Sulfur Coal Additive for Improved Furnace Operation” filed July 30, 2002; (iv) U.S. Provisional Patent Application Serial No. 60/730,971 entitled “Additives for Catalysis of Mercury Oxidation in Coal-Fired Power Plants” filed October 27, 2005; and (v) any and all continuations, continuations-in-part, and divisionals, and all patents issuing which are based on such applications, and all reissues, reexaminations, or extensions thereof, as well as any foreign counterparts, continuations, continuations-in-part or

divisions thereof and patents and patent applications on any improvements, advancements, modifications, revisions or developments that are developed by or for ADA, together with any other patents (U.S. or foreign and even if not listed herein) that share a common claim of priority with said patents or that cover inventions substantially similar to said patents.

“ Permitted Transfer ” has the meaning given such term in Section 9.1 .

“ Permitted Transferee ” has the meaning given such term in Section 9.1 .

“ Person ” means an individual, business entity (including a corporation, limited partnership, general partnership, registered limited partnership, registered limited liability partnership or limited liability company), business trust, estate, trust, association, joint venture, government, governmental subdivision or agency, or any other legal or commercial entity organized or existing in any jurisdiction.

“ Pre-Closing Cash ” means all cash and cash equivalents received by the Company or its Subsidiaries on or prior to the Effective Date plus all cash and cash equivalents received by the Company or its Subsidiaries prior to July 31, 2011 pursuant to contracts or other legally binding arrangements in effect on the Effective Date; provided that the amount of Pre-Closing Cash with respect to any Distribution shall be calculated in accordance with the example set forth in Schedule 4.5(a) .

“ Prime Rate ” means the “prime rate” published in The Wall Street Journal from time to time.

“ Profits or Losses ” means, for each Fiscal Year, the taxable income or loss of the Company as determined for federal income tax purposes, as adjusted by Section 3.5(b) . Profits and Losses shall be determined net of any amounts allocated pursuant to Section 4.2 and Section 4.3 .

“ Proceeding ” has the meaning given such term in Section 10.1(a) .

“ Profit Sharing Distribution Amount ” has the meaning given such term in Section 4.8 .

“ Projected Distributable Value ” has the meaning given such term in Section 4.5(b)(ii) .

“ Projected Investment Value ” means, as of any measurement date, fifteen and fifteen-nineteenths percent (15 ¹⁵ / 19 %) of the Projected Distributable Value as of such date.

“ Proposed Transferor ” has the meaning given such term in Section 9.2 .

“ Purchase Agreement ” has the meaning given such term in the recitals hereto.

“ Purchase Price ” has the meaning given such term in Section 9.2(d) .

“ Purchasing Members ” has the meaning given such term in Section 9.2(c) .

“ Redemption ” has the meaning given such term in Section 9.5 .

“ Redemption Notice ” has the meaning given such term in Section 9.5 .

“ Refined Coal ” means a liquid, gaseous or solid fuel produced from coal that produces, upon sale to an unrelated person, a credit under Section 45.

“ Regulatory Allocations ” has the meaning given such term in Section 4.2(h) .

“ Related Business Opportunity ” has the meaning given such term in Section 11.9(a) .

“ Representatives ” has the meaning given such term in Section 11.8(d) .

“ Sale Notice ” has the meaning given such term in Section 9.3(c) .

“ Section 45 ” means Section 45 of the Code or any successor or replacement provision thereof, or any amendment thereto.

“ Section 45 Business ” means each business of the Company or a Subsidiary of the Company in respect of which, inter alia, the Company shall have “placed in service” (within the meaning of Section 45(d)(8)(A) of the Code) a Facility prior to January 1, 2012, for the production of Refined Coal to be used to reduce NOx and mercury emissions in cyclone coal-fired boilers, and as to which the Company has entered into an agreement or agreements to sell a Facility to a third party, and such third party would be thereafter entitled to Tax Credits for the Refined Coal produced from such Facility. The foregoing January 1, 2012 date shall be extended from time to time to be coterminous with any extension of the January 1, 2012 date currently in Section 45(d)(8) of the Code or with any alternative extension or the elimination of the “placed in service” deadline for a “refined coal production facility” provided for in such Section 45(d)(8).

“ Securities Act ” means the Securities Act of 1933, as amended, and applicable rules and regulations thereunder, and any successor to such statute, rules or regulations.

“ Sharing Ratio ” means the sharing ratio of a Member, expressed as a percentage of the total, in allocations of Profits, Losses and other items of income, gain, loss or deduction and distributions of cash and property. The initial Sharing Ratio shall be equal to the ownership by each Member of Units, expressed as a ratio equal to the number of Units held by such Member over the number of outstanding Units, as set forth on Exhibit A . Thereafter, the Sharing Ratio shall be adjusted and Exhibit A shall be amended or updated from time to time to reflect the Sharing Ratio in effect at any given time, as required by this Agreement, based on (i) the Capital Contributions made by each Member and the ownership of Units that reflect such Capital Contributions, and (ii) any Transfers of Units.

“ Stalemate ” has the meaning given such term in Section 5.3 .

“ Stalemate Determination ” has the meaning given such term in Section 5.3 .

“ Subsidiary ” or “ Subsidiaries ” of the Company means any other Person (i) more than 50% of whose outstanding shares or securities representing the right to vote for the election of directors or other managing authority of such other Person are, now or hereafter, owned or controlled, directly or indirectly, by the Company, but such other Person shall be deemed to be a Subsidiary of the Company only so long as such ownership or control exists, or (ii) which does not have outstanding shares or securities with such right to vote, as may be the case in a partnership, joint venture or unincorporated association, but more than 50% of whose ownership interest representing the right to make the decisions for such other Person is, now or hereafter, owned or controlled, directly or indirectly, by the Company, but such other Person shall be deemed to be a Subsidiary of the Company only so long as such ownership or control exists. For the avoidance of doubt, Clean Coal Solutions Services, LLC, a Colorado limited liability company, is not, and shall not be considered for any purposes of this Agreement, a Subsidiary of the Company.

“ Tag-Along Member ” has the meaning given such term in Section 9.3(b) .

“ Tag-Along Notice ” has the meaning given such term in Section 9.3(e) .

“ Tag-Along Right ” has the meaning given such term in Section 9.3(b) .

“ Tag-Along Sale ” has the meaning given such term in Section 9.3(b) .

“ Tag-Along Transferor ” has the meaning given such term in Section 9.3(b) .

“ Tag-Along Units ” has the meaning given such term in Section 9.3(a) .

“ Tax Credit ” means the credit provided by Section 45 for the production and sale of Refined Coal.

“ Tax Matters Partner ” or “ TMP ” has the meaning given such term in Section 7.3(c)(i) .

“ Technical Engineering Services ” means the technical engineering services set forth in Exhibit D .

“ Technology ” means the Patents and the Know-How specifically pertaining to NOx and mercury emissions control for cyclone coal-fired boilers, as well as any Know-How which is based on the knowledge contained in the Patents; provided, however, that such Know-How shall be a trade secret of ADA until such time as it is the subject of a published patent application.

“ Term Sheet ” means that certain indicative term sheet, dated as of May 4, 2011, by and between the Company and Goldman, Sachs & Co. and the side letter thereto dated May 10, 2011.

“ Third Party Accountant ” has the meaning given such term in Section 7.3(a)(i) .

“ Third Party Claim ” has the meaning given such term in Section 10.2(b) .

“ Third Party Terms ” has the meaning given such term in Section 9.3(c) .

“ TMP ” has the meaning given such term in Section 7.3(c)(i) .

“ Transaction Agreements ” means this Agreement, the Purchase Agreement, that certain Exclusive Right to Lease Agreement, dated as of the date hereof, between the Company and GS, the ADA Guarantee and the NexGen Guarantee, as the same are in effect as of the Effective Date.

“ Transfer ” means any direct or indirect sale, transfer, assignment, pledge, mortgage, exchange, hypothecation, gift, grant of a security interest or other direct or indirect disposition or encumbrance (whether with or without consideration, whether voluntarily or involuntarily or by operation of law) or the acts thereof, including derivative or similar transactions or arrangements whereby a portion or all of the economic interest in, or risk of loss or opportunity for gain with respect to, Units is transferred or shifted to another Person; provided, however, that the indirect pledge, mortgage or grant of a security interest in the proceeds derived from Units or the ownership interest in any Member by any direct or indirect parent of such Member in order to secure commercially reasonable borrowing or other Indebtedness shall not constitute a “Transfer” of such Units; and provided further, that the Transfer of any or all of the equity interests in any Member or in any direct or indirect parent entity of such Member shall in no event be considered a “Transfer” of the Units held by such Member. Unless otherwise defined herein, the terms “Transferee,” “Transferred,” and other forms of the word “Transfer” shall have the correlative meanings.

“ Transfer Notice ” has the meaning given such term in Section 9.2(a) .

“ Treasury Regulations ” means the income tax regulations promulgated by the United States Treasury Department pursuant to the Code, as amended from time to time.

“ Unit ” means a limited liability company interest in the Company denominated in a unit with the rights and obligations as set forth in this Agreement and the Act, including the Unit owner’s undivided right to share in the profits and losses of the Company and the right to receive distributions of assets and, in the case of Voting Units only, the right to participate in the management of the Company as set forth herein. Unless the context otherwise requires, any reference herein to Units shall include Class A Units and Class B Units and shall be deemed to refer to Voting Units and Non-voting Units, as appropriate and as the context requires.

“ Unrecovered Investment Balance ” means the amount, as of any measurement date, equal to the GS Investment Amount, less (i) the aggregate amount of all Distributable Value Distributed or deemed Distributed to the holders of Class B Units as of such date, using an implied interest rate of fifteen percent (15%) per annum, as accrued annually, and less (ii) to the extent not duplicative of clause (i) above, the aggregate amount of all Distributable Cash Distributed or deemed Distributed to the holders of Class B Units as of such date. For purposes of determining the Unrecovered Investment Balance, (A) Tax Credits will be deemed to have been Distributed (to the extent such Tax Credits have been allocated to holders of Class B Units) as provided in Schedule 4.5(b) , and (B) only Distributions with respect to the Class B Units acquired by GS pursuant to the Purchase Agreement shall be taken into account, and, for avoidance of doubt, no consideration paid with respect to any Units acquired by GS pursuant to the preemptive rights set forth in Section 6.6 shall be taken into account when determining the Unrecovered Investment Balance.

“ Valid Claim(s) ” means any claim contained in an issued and unexpired patent included within the Patents that has not been held unenforceable, unpatentable or invalid by a decision of a court or other governmental agency of competent jurisdiction, unappealable or unappealed within the time allowed for appeal, and that has not been admitted to be invalid or unenforceable through reissue or disclaimer.

“ Valuation Expert ” has the meaning given such term in Section 4.5(b)(iii) .

“ Voting Member ” means a Member owning Voting Units.

“ Voting Units ” means Units that have all associated voting, consent or approval rights in addition to an economic interest in the Company and all other rights associated with Units, including Class A Units.

1.2 Rules of Construction .

(a) Section References . When a reference is made in this Agreement to an Article, Section, Paragraph, Exhibit or Schedule, such reference shall be to an Article, Section or Paragraph of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated. Unless otherwise indicated, the words “herein,” “hereof,” “hereunder” and other words of similar import refer to this Agreement as a whole, and not to any particular Article, Section, Paragraph or clause in this Agreement.

(b) Construction . Unless the context of this Agreement clearly requires otherwise: (i) references to the plural include the singular and vice versa, (ii) the masculine shall include feminine and neuter, and the neuter shall include the masculine and feminine, (iii) the word “including” shall mean “including, without limitation,” and (iv) the use of the words “or,” “either” and “any” shall not be exclusive. Unless otherwise specified, all references to days or months shall be deemed references to calendar days or months, and all references to “$” shall be deemed references to United States dollars.

(c) Headings . The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement or any provision of this Agreement.

(d) No Interpretation Against Author . The parties hereto have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions of this Agreement.

(e) Conflicts with Related Documents . The relationship of the parties is being memorialized in this Agreement and in the other Transaction Agreements. In the event of a

conflict between any term(s) or provision(s) of this Agreement and anything contained in any of the other Transaction Agreements, this Agreement shall be overriding and controlling but solely to the extent of such conflict.

ARTICLE II

FORMATION OF THE COMPANY

2.1 Name and Formation . The name of the Company is Clean Coal Solutions, LLC. The Company was formed under the name “ADA-NexCoal, LLC” by the filing of Articles of Organization of the Company (as amended, the “ Articles ”) with the Secretary of State of the State of Colorado on October 31, 2006, pursuant to the Act. The Company changed its name to “Clean Coal Solutions, LLC” by the filing of Articles of Amendment with the Secretary of State of the State of Colorado on January 10, 2007, pursuant to the Act. The Company’s Business may be conducted under such other name(s) as the Board may from time to time agree to be necessary or advisable. The rights and liabilities of the parties hereto shall be as provided in the Act except as herein otherwise expressly provided.

2.2 Operating Agreement . The Members hereby execute this Agreement for the purpose of organizing the affairs of the Company and the conduct of its business in accordance with the provisions of the Act. The Members hereby agree that during the term of the Company set forth in Section 2.5 , the rights, powers and obligations of the Members with respect to the Company will be determined in accordance with the terms and conditions of this Agreement and the Act.

2.3 Principal Place of Business; Qualification . The principal place of business of the Company shall be located at 8100 SouthPark Way, Unit B, Littleton, CO 80120. The Company may locate its place(s) of business and registered office at any other place(s) as the Board may from time to time deem necessary or advisable. The Company shall qualify to do business in such states or other jurisdictions in which such qualification is necessary.

2.4 Registered Office and Registered Agent . The address of the registered office of the Company in the State of Colorado shall be the office of the initial registered agent named in the Articles or such other office (which need not be a place of business of the Company) as the Board may designate from time to time in the manner provided by applicable Law, and the registered agent for service of process on the Company in the State of Colorado at such registered office shall be the registered agent named in the Articles or such other Person or Persons as the Board may designate from time to time in the manner provided by applicable Law.

2.5 Term . The term of the Company commenced on the filing of the Articles with the Secretary of State of the State of Colorado, and the existence of the Company shall be unlimited, subject to the Company being dissolved in accordance with the provisions of this Agreement and applicable Law.

2.6 Purposes and Powers .

(a) Purposes . The purposes and character of the business of the Company shall be to (i) enter into the Transaction Agreements, (ii) accept contributions by the Members in accordance with the provisions of this Agreement and the Purchase Agreement, (iii) engage in the Chemicals Business and the Section 45 Business, and (iv) engage in other business consistent with or in furtherance of the foregoing related to Refined Coal, as may be necessary or appropriate to accomplish the purposes set forth herein or as may be approved by the Board from time to time (collectively, the “ Business ”). The Company will not engage in any other business or activity not within the scope of the Business or otherwise permitted or contemplated by this Agreement (whether or not permitted by the Articles) unless approved by the Board or, if required, the Members in accordance with Section 6.1 .

(b) Powers . The Company shall have all powers which are necessary or desirable to carry out the purposes and Business of the Company, to the maximum extent the same are available and may be legally exercised by limited liability companies under the Act.

2.7 Default Rules Under the Act . Regardless of whether this Agreement specifically refers to a particular Default Rule: (i) if any provision of this Agreement conflicts with a Default Rule, the provision of this Agreement controls and such Default Rule is hereby modified or negated accordingly, and (ii) if it is necessary to construe a Default Rule as modified or negated in order to effectuate any provision of this Agreement, such Default Rule is hereby modified or negated accordingly.

2.8 Existing LLC Agreement . This Agreement amends, restates and supersedes the Existing LLC Agreement in its entirety.

2.9 Title to Property . All real and personal property, whether tangible or intangible, owned by the Company shall be owned by the Company as an entity and no Member shall have any ownership interest in such property in such Member’s individual name, and each Member’s interest in the Company shall be personal property for all purposes. Except as otherwise provided in this Agreement, the Company shall hold all of its real and personal property in the name of the Company and not in the name of any Member.

2.10 Intent .

(a) Tax Treatment . It is the intent of the Members that the Company be classified as a partnership for federal and state income tax purposes. The Company shall take all appropriate actions to ensure that the Company will be treated as a partnership for federal and state income tax purposes, including the making of available tax elections. No election may be made to treat the Company as an association taxable as a corporation for federal or state income tax purposes without obtaining the unanimous written consent of all of the Members pursuant to Section 6.1(a) . Neither the Company nor any Member shall take any action inconsistent with the express intent of the parties hereto as set forth in this Section 2.10 .

(b) No State-Law Partnership . Except with respect to tax treatment as set forth in Section 2.10(a) , the Members intend that the Company not be a partnership (including a limited partnership) or joint venture, and that no Member be a partner or joint venturer of any other Member by virtue of this Agreement, and neither this Agreement nor any other document entered into by the Company or any Member relating to the subject matter hereof shall be construed to suggest otherwise.

ARTICLE III

CAPITAL CONTRIBUTIONS AND ACCOUNTS; ADJUSTMENT OF SHARING RATIOS

3.1 Initial Capital Contributions and Ownership Structure .

(a) Prior to the Effective Date, ADA contributed one thousand dollars ($1,000.00) and the Licensed Property to the Company pursuant to the terms of the License Agreement, in receipt for which ADA received one hundred Units (100) in the Company, representing one hundred percent (100%) of the membership interests in the Company at that time. ADA later sold fifty (50) of its Units to NexGen so that, immediately prior to the execution of this Agreement, ADA and NexGen each owned fifty (50) Units in the Company (the “ Existing Units ”), representing one hundred percent (100%) of the membership interests of the Company at that time. Upon execution of this Agreement and the other Transaction Agreements by the parties hereto and thereto, the Existing Units will automatically be cancelled without any action on the part of the Company or any Member and in exchange therefor ADA and NexGen will each receive forty-two and two-nineteenths (42 2/19) Class A Units, and following such cancellation and exchange, each of ADA and NexGen will own forty-two and two-nineteenths percent (42 2/19%) of the total fully diluted membership interests in the Company. In accordance with the Purchase Agreement, GS has agreed to make a Capital Contribution in the amount of the GS Investment Amount, in consideration for such Capital Contribution the Company has agreed to issue and sell to GS fifteen and fifteen-nineteenths (15 15/19) Class B Units, and following such issuance of Class B Units to GS, GS will own fifteen and fifteen-nineteenths percent (15 15/19%) of the total fully diluted membership interests in the Company. Notwithstanding anything to the contrary contained in this Agreement, the Class B Units issued to GS pursuant to the Purchase Agreement shall at all times represent at least fifteen and fifteen-nineteenths percent (15 15/19%) of the total fully diluted membership interests in the Company, and the Sharing Ratio of GS shall at all times be equal to at least fifteen and fifteen-nineteenths percent (15 15/19%). Immediately following the Capital Contribution by GS of the GS Investment Amount, to the fullest extent permitted by Law, the Company shall Distribute the GS Investment Amount to the Members of the Company immediately prior to the Effective Date pro rata based on the number of Units then held by each such Member as compared to the aggregate number of Units then held by all such Members on a total fully diluted membership interest basis, without regard to the Distribution requirements set forth in Section 4.5 or elsewhere in this Agreement or the Existing LLC Agreement. The Members agree that the Unit ownership and the Sharing Ratios of the Members, on and immediately after the Effective Date, shall be as set forth in Exhibit A hereto.

(b) The Members and the Company agree that for all applicable Tax purposes the contribution by GS of the GS Investment Amount followed by the Distribution of the GS

Investment Amount to the Members of the Company immediately prior to the Effective Date shall be treated as a sale by the Members of the Company as of the Effective Date of Class B Units to GS under Section 707(a) of the Code (the “ Deemed Sale ”). The Company and GS agree to report the transaction in accordance with this Section 3.1(b), and the Company and the Members agree to take no position on any Tax return, financial accounting record or other similar document that would be inconsistent with such treatment. The Company shall make the election under Section 754 of the Code for the Company’s taxable year in which the Deemed Sale occurs to adjust the basis of Company property in the manner provided in Section 743 of the Code.

3.2 Additional Capital Contributions; Adjustment of Sharing Ratios and Units .

(a) Additional Capital Contributions . Notwithstanding anything else in this Agreement to the contrary, (i) except for the GS Investment Amount to be contributed to the Company by GS pursuant to the Purchase Agreement, GS shall not be required to make any Capital Contribution unless such Capital Contribution has been approved by GS in writing, and (ii) no other Member shall make, or be required to make, any Capital Contribution except in accordance with this Section 3.2 and/or Section 3.3 . The Board shall consider any capital requirements of the Company and will notify the Members, no less than thirty (30) days prior to the need therefor, of any projected need for additional Capital Contributions in order to fund operations or to further the purposes of the Company. The Class A Members shall be required to make additional Capital Contributions only if such additional Capital Contributions are approved by all of the Class A Members in writing. The Board shall give the Class A Members notice of each request for additional Capital Contributions that has been approved by the Class A Members in accordance with this Section 3.2 (each, a “ Capital Call ”) at least fifteen (15) days prior to the date on which the Capital Contributions are due and will include in such Capital Call, in reasonable detail, (i) the purpose or purposes for which additional Capital Contributions are required, (ii) the amount of the additional Capital Contribution to be made by each Class A Member and the number of additional Units or other securities, if any, to be issued as a result of such Capital Call, (iii) whether such issued Units or other securities, if any, will be Voting Units or Non-voting Units, and (iv) the date on which such additional Capital Contributions must be made. Unless otherwise agreed by all of the Class A Members in writing, the Class A Members shall be required to make any additional Capital Contributions requested pursuant to this Section 3.2 pro rata based on the number of Class A Units then held by each such Class A Member as compared to the aggregate number of Class A Units then held by all Class A Members. Except as otherwise provided herein or as agreed to by all of the Class A Members in writing, the Class A Members will have the preemptive right to acquire any additional Units to be issued in return for additional Capital Contributions in accordance with Section 6.6 .

(b) Adjustment of Sharing Ratios and Units . Unless otherwise agreed in writing by all of the Members, in no event will additional Units be issued in connection with any Capital Contribution made pursuant to Section 3.2(a) . The Capital Account balances, and Sharing Ratios in effect at the time of a Capital Contribution made pursuant to Section 3.2(a) shall be adjusted in proportion to the respective amounts of additional capital contributed by each Class A Member in response to a Capital Call, subject to the provisions of Section 3.3 in the event a Class A Member fails to timely make all or any portion of the Capital Contribution

required to be made by such Class A Member pursuant to a Capital Call. Following all Capital Contributions made by one or more Class A Members pursuant to Section 3.2(a) , including any advances made by one or more Participating Members pursuant to Section 3.3 , the number of Class A Units held by each Class A Member shall be deemed to equal (i) the aggregate number of Class A Units then outstanding, multiplied by (ii) a fraction, the numerator of which is the aggregate fair market value (as of the date such Capital Contributions were made) of all Capital Contributions made by, or transferred to, such Class A Member since the inception of the Company with respect to Class A Units then held by such Member, and the denominator of which is the aggregate fair market value (as of the date such Capital Contributions were made) of all Capital Contributions made by all Class A Members since the inception of the Company. Following each Capital Contribution made pursuant to Section 3.2(a) or Section 3.3 , Exhibit A shall be updated appropriately to reflect any changes in the Sharing Ratio and/or the number of Class A Units held by each Class A Member. For the avoidance of doubt, the Sharing Ratio and number of Class B Units held by each Class B Member shall in no way be affected by any Capital Contributions made by the Class A Members pursuant to Section 3.2(a) or Section 3.3 , and in no event will any such Capital Contribution trigger any preemptive right, right of first refusal, tag-along right, drag-along right, or any similar right in favor of the Company or any Member, whether pursuant to Section 6.6 , Section 9.2 , Section 9.3 , Section 9.4 , or otherwise.

3.3 Failure to Make a Required Additional Capital Contribution .

(a) If a Class A Member (the “ Defaulting Member ”) does not make all or any portion of an additional Capital Contribution that such Defaulting Member is required to make pursuant to a Capital Call in accordance with Section 3.2(a) by the date set forth in such Capital Call (the portion of such Capital Contribution not made, the “ Default Amount ”), then the Company shall forthwith notify the other Class A Members (the “ Non-Defaulting Members ”) of the Default Amount, and the Non-Defaulting Members may take the following actions: within twenty (20) days after a Defaulting Member’s default, the Non-Defaulting Members may advance Capital Contributions, in each Non-Defaulting Member’s sole discretion, in an aggregate amount not in excess of the Default Amount in such proportions as they may agree, or if they cannot agree, pro rata in accordance with their respective Sharing Ratios in effect immediately prior to such advancement of Capital Contributions (with any Non-Defaulting Member making such an advance referred to as a “ Participating Member ”).

(b) Advances from Participating Members under Section 3.3(a) shall be treated as Capital Contributions by the Participating Members, and the Sharing Ratios and Capital Account balances of the Class A Members shall be adjusted in accordance with Section 3.2(b) to accurately reflect all such advances. The number of Class A Units held by each Member following any advance made by one or more Participating Members pursuant to Section 3.3(a) shall be determined in accordance with Section 3.2(b) .

(c) In the event the Non-Defaulting Members elect not to make up all of the Default Amount, the Company shall have the right to take any action available at law or in equity against the Defaulting Member for failure to make the required Capital Contribution, including suing for damages, specific performance or any combination of available remedies. All remedies available to the Company shall be cumulative, and the election of any one shall not preclude the availability of another, to the extent permitted under applicable Law. In any action brought by

the Company to enforce its rights under this Section 3.3 , the prevailing party in such action shall be entitled to recover all costs and fees (including reasonable attorneys’ fees) incurred by it in connection with such action, including any appeals.

3.4 No Third Party Right to Enforce . No Person other than the Company or a Member shall have the right to enforce any obligation of a Member to make a Capital Contribution hereunder, and specifically no lender or other third party shall have any such rights.

3.5 Capital Accounts .

(a) Maintenance of Capital Accounts . The Company shall maintain a separate Capital Account for each Member in accordance with the requirements of Treasury Regulation Section 1.704-1(b)(2)(iv). Each Member’s Capital Account (a) shall be increased by (i) the amount of money contributed by such Member to the Company, (ii) the Book Value of property contributed by such Member to the Company (net of liabilities secured by the contributed property that the Company is considered to assume or take subject to under Code Section 752) and (iii) allocations to such Member of Profits and any other items of income or gain allocated to such Member, and (b) shall be decreased by (i) the amount of money distributed to such Member by the Company, (ii) the Book Value of property distributed to such Member by the Company (net of liabilities secured by the distributed property that such Member is considered to assume or take subject to under Code Section 752), and (iii) allocations to such Member of Losses and any other items of loss or deduction allocated to such Member. For this purpose, the Company may, upon the occurrence of the events specified in Treasury Regulation Section 1.704-1(b)(2)(iv)(f), increase or decrease the Capital Accounts in accordance with the rules of such regulation and Treasury Regulation Section 1.704-1(b)(2)(iv)(g) to reflect a revaluation of the Company’s property, provided that, the Board in its reasonable judgment determines that such adjustments are necessary or appropriate to reflect the relative economic interests of the Members in the Company. The Company intends to effect a revaluation of its Capital Accounts as soon as reasonably practicable following the closing of the transactions contemplated by this Agreement, which revaluation shall be effective immediately prior to the transactions contemplated by this Agreement.

(b) Computation of Profits and Losses . For purposes of computing the Profits or Losses of the Company for any period, and any item of the Company’s income, gain, loss or deduction to be allocated pursuant to Article IV and to be reflected in the Capital Accounts, the determination, recognition and classification of any such item shall be the same as its determination, recognition and classification for federal income tax purposes (including any method of depreciation, cost recovery or amortization used for this purpose); provided, that:

(i) the computation of all items of income, gain, loss and deduction shall include those items described in Code Section 705(a)(1)(B) or Code Section 705(a)(2)(B) and Treasury Regulation Section 1.704-1(b)(2)(iv)(i), without regard to the fact that such items are not includable in gross income or are not deductible for federal income tax purposes;

(ii) if the Book Value of any of the Company’s property is adjusted pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(e) or (f), the amount of such adjustment shall be taken into account as gain or loss from the disposition of such property;

(iii) items of income, gain, loss or deduction attributable to the disposition of the Company’s property having a Book Value that differs from its adjusted basis for tax purposes shall be computed by reference to the Book Value of such property;

(iv) items of depreciation, amortization and other cost recovery deductions with respect to the Company’s property having a Book Value that differs from its adjusted basis for tax purposes shall be computed by reference to the property’s Book Value in accordance with Treasury Regulation Section 1.704-3(d);

(v) to the extent an adjustment to the adjusted tax basis of any asset of the Company pursuant to Code Sections 732(d), 734(b) or 743(b) is required, pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m), to be taken into account in determining Capital Accounts, the amount of such adjustment to the Capital Accounts shall be treated as an item of gain (if the adjustment increases the basis of the asset) or loss (if the adjustment decreases such basis); and

(vi) any items that are allocated pursuant to Section 4.2 shall be determined by applying rules analogous to those set forth in clauses (a) through (g) hereof but shall not be taken into account in computing Profits and Losses.

(c) A Member that has more than one membership interest in the Company shall have a single Capital Account that reflects all such interests, regardless of the class of interest owned and regardless of the time or manner in which the interests were acquired; provided, however, that the Capital Accounts shall be maintained in such manner as will facilitate a determination of the portion of each Capital Account attributable to Class A Units and the portion attributable to Class B Units.

3.6 No Interest on Capital . No interest shall be paid by the Company on the Capital Contributions by the Members, as reflected in their Capital Accounts from time to time.

3.7 Creditor’s Interest in Company . No creditor of the Company (including a creditor who makes a loan to the Company or a creditor who provides goods or services to the Company) shall have or acquire, at any time as a result of making the loan or providing the goods and services, any direct or indirect interest in the profits, capital or property of the Company other than as a creditor.

3.8 Return of Capital . Except as otherwise provided in this Agreement, no Member shall have the right to demand the return of any Capital Contribution. Except as required by the Act, no Member shall have any liability for the return of the Capital Contributions of any other Member. Except as otherwise provided in this Agreement, no Member shall have priority over any other Member either as to the return of Capital Contributions or as to any cash or other

Distributions by the Company. Except as otherwise provided in this Agreement, no Member shall have the right to (i) receive property other than cash as a return of Capital Contributions or as any other Distributions, (ii) withdraw any part of the Member’s Capital Contributions, or (iii) receive any funds or property of the Company.

3.9 Distributions In-Kind . To the extent that the Company distributes property in-kind to the Members, the Company shall be treated as making a Distribution equal to the fair market value of such property, as determined by the Board in good faith, for purposes of Section 4.1 and such property shall be treated as if it were sold for an amount equal to its fair market value and any resulting gain or loss shall be allocated to the Members’ Capital Accounts in accordance with Sections 4.2 through 4.4 .

3.10 Transfer of Capital Accounts . On the Transfer of all or part of a Member’s Units, the portion of the Capital Account of the Transferor Member that is attributable to the Transferred Units shall carry over to the Transferee Member in accordance with the provisions of Treasury Regulation Section 1.704-1(b)(2)(iv)(l). The Capital Account of any Member whose interest in the Company shall be increased or decreased by means of the repurchase of Units shall be appropriately adjusted to reflect such repurchase. Any reference in this Agreement to a Capital Contribution of or Distribution to a Member that has succeeded any other Member shall include any Capital Contributions or Distributions previously made by or to the former Member on account of the Units of such former Member Transferred to such Member.

ARTICLE IV

ALLOCATIONS AND DISTRIBUTIONS

4.1 Allocations . After making the allocations required by Section 4.2 , any remaining Profits or Losses for any Fiscal Year, and to the extent the Board determines in its reasonable judgment it is necessary or appropriate, individual items of income, gain, loss and deduction of the Company, shall be allocated among the Members in such a manner as to reduce or eliminate, to the extent possible, any difference, as of the end of such Fiscal Year, between (a) the sum of (i) the Capital Account of each Member, (ii) such Member’s share of Minimum Gain (as determined according to Treasury Regulation Section 1.704-2(g)) and (iii) such Member’s partner nonrecourse debt minimum gain (as defined in Treasury Regulation Section 1.704-2(i)(2)) and (b) the respective net amounts, positive or negative, which would be distributed to them or for which they would be liable to the Company under this Agreement and the Act, determined as if the Company were to (A) sell the assets of the Company for an amount equal to their Book Value (B) satisfy all Company liabilities in accordance with their terms (limited, in the case of any nonrecourse liability to the Book Value of the Company assets securing such liability) and (C) distribute the proceeds of such sale pursuant to Section 4.5 , including any Liquidation Preference, if applicable.

4.2 Special Allocations .

(a) Minimum Gain Chargeback . Notwithstanding any other provision of this Section 4.2 , if there is a net decrease in the Minimum Gain during any Fiscal Year, each Member shall be allocated items of Company income and gain for such Fiscal Year (and, if necessary, for

subsequent Fiscal Years) in the amounts and of such character as determined according to Treasury Regulation Section 1.704-2(f). This Section 4.2(a) is intended to be a Minimum Gain chargeback provision that complies with the requirements of Treasury Regulation Section 1.704-2(j)(4), and shall be interpreted in a manner consistent therewith.

(b) Member Nonrecourse Debt Minimum Chargeback . Notwithstanding any provision of this Section 4.2 other than Section 4.2(a) above, if there is a net decrease during a Fiscal Year in partner nonrecourse debt minimum gain (as defined in Treasury Regulation Section 1.704-2(i)(2)), items of Company income and gain for such Fiscal Year (and, if necessary, for subsequent Fiscal Years) shall be allocated to the Members in the amounts and of such character as determined according to Treasury Regulation Section 1.704-2(i)(4). This Section 4.2(b) is intended to comply with the partner nonrecourse debt minimum gain chargeback requirement in Treasury Regulation Section 1.704 2(i)(4) and shall be interpreted consistently therewith.

(c) Qualified Income Offset . If any Member that unexpectedly receives an adjustment, allocation or distribution described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6) has an Adjusted Capital Account Deficit as of the end of any Fiscal Year, computed after the application of Sections 4.2(a) and 4.2(b) but before the application of any other provision of this Article IV , then items of Company income and gain for such Fiscal Year shall be allocated to such Member in proportion to, and to the extent of, such Adjusted Capital Account Deficit. This Section 4.2(c) is intended to be a qualified income offset provision as described in Treasury Regulation Section 1.704-1(b)(2)(ii)(d) and shall be interpreted in a manner consistent therewith.

(d) Adjusted Capital Account Deficit . In the event any Member has an Adjusted Capital Account Deficit at the end of any Taxable Year, such Member shall be allocated items of Company gross income and gain in the amount of such excess as quickly as possible; provided, however, that an allocation pursuant to this Section 4.2(d) shall be made only if and to the extent that such Member would have an Adjusted Capital Account Deficit after all other allocations provided in this Section 4.2 have been tentatively made as if Section 4.2(c) and this Section 4.2(d) were not in this Agreement.

(e) Nonrecourse Deductions . Nonrecourse deductions (as determined according to Treasury Regulation Section 1.704-2(b)(1)) for any Fiscal Year shall be allocated ratably among such Members based upon the manner in which Profits and Losses are allocated among the Members for such Fiscal Year (and if no Profits or Losses are allocable in any Fiscal Year, pro rata based on the number of Units then held by each Member as compared to the number of Units then held by all Members on a fully diluted membership interest basis).

(f) Partner Nonrecourse Deductions . Partner nonrecourse deductions (as determined in accordance with Treasury Regulation Section 1.704-2(i)(2) attributable to partner nonrecourse debt (as defined in Treasury Regulation Section 1.704-2(b)(4)) for any Taxable Year shall be allocated to the Member or Members that bear the economic risk of loss (determined in accordance with Treasury Regulation Section 1.752-2) with respect to the debt to which the partner nonrecourse deductions are attributable. If more than one Member bears the

economic risk of loss with respect to a partner nonrecourse debt, partner nonrecourse deductions attributable thereto shall be allocated between or among such Members in accordance with the ratios in which they share such economic risk of loss. This Section 4.2(f) is intended to comply with the provisions of Treasury Regulation Section 1.704-2(i) and shall be interpreted consistently therewith.

(g) Allocation of Certain Profits and Losses . Items of income, gain, Loss and deduction described in Section 3.5(b)(v) shall be allocated in a manner consistent with the manner that the adjustments to the Capital Accounts are required to be made pursuant to Treasury Regulation Section 1.704-1(b)(2)(iv)(m).

(h) Curative Allocations . The allocations set forth in Sections 4.2(a) - (c) and (e) - (f) (the “ Regulatory Allocations ”) are intended to comply with certain requirements of Sections 1.704-1(b) and 1.704-2 of the Treasury Regulations. The Regulatory Allocations may not be consistent with the manner in which the Members intend to allocate Profit and Loss of the Company or make the Company’s Distributions. It is the intent of the Members that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of Company income, gain, loss, or deduction pursuant to this Section 4.2(h) . Accordingly, notwithstanding the other provisions of this Article IV (other than the Regulatory Allocations), but subject to the Code and the Treasury Regulations, the Board shall make such offsetting allocations of Company income, gain, deduction and loss in whatever manner it deems appropriate so that, after such offsetting allocations are made, each Member’s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Member would have had if the Regulatory Allocations were not part of this Agreement. In exercising its discretion under this Section 4.2(h) , the Board shall take into account future Regulatory Allocations that, although not yet made, are likely to offset other Regulatory Allocations previously made.

4.3 Offsetting Allocations . If, and to the extent that, any Member is deemed to recognize any item of income, gain, deduction or loss as a result of any transaction between such Member and the Company pursuant to Sections 83, 482, or 7872 of the Code or any similar provision now or hereafter in effect, the Board shall allocate any corresponding Profit or Loss to the other Members of the Company.

4.4 Tax Allocations .

(a) Allocations Generally . Except as otherwise provided in this Section 4.4 , the income, gains, losses, deductions and credits of the Company will be allocated for federal, state and local income tax purposes among the Members in the same manner as such income, gains, losses, deductions and credits are allocated among the Members for purposes of computing their Capital Accounts.

(b) Code Section 704(c) Allocations . Items of the Company’s taxable income, gain, loss and deduction with respect to any property contributed to the capital of the Company shall be allocated among the Members in accordance with Code Section 704(c) and the applicable Treasury Regulations thereunder so as to take account of any variation between the

adjusted basis of such property to the Company for federal income tax purposes and its Book Value. In addition, if the Book Value of any of the Company’s asset is adjusted pursuant to the requirements of Treasury Regulation Section 1.704-1(b)(2)(iv)(e) or (f), then subsequent allocations of items of taxable income, gain, loss and deduction with respect to such asset shall take account of any variation between the adjusted basis of such asset for federal income tax purposes and its Book Value in the same manner as under Code Section 704(c). The Board shall determine all allocations pursuant to this Section 4.4(b) using the “traditional method” described in Treasury Regulation Section 1.704-3(b), or any other reasonable method selected by the Board.

(c) Allocation of Tax Credits, Tax Credit Recapture, Etc . Allocations of tax credits, tax credit recapture, and any items related thereto shall be allocated to the Members according to their interests in the Company at the time such items of tax credit or tax credit recapture arise, as determined by the Board taking into account the principles of Treasury Regulation Section 1.704-1(b)(4)(ii).

(d) Recapture . If any deductions for depreciation or cost recovery are recaptured as ordinary income upon the sale or other disposition of Company properties, the ordinary income character of the gain from such sale or disposition shall be allocated among the Members in the same ratio as the deductions giving rise to such ordinary income character were allocated.

(e) Other Allocations . All items of income, gain, loss, deduction and credit allocable to Units that may have been transferred shall be allocated between the transferor and the transferee as determined by the Board in accordance with a method permissible under Code Section 706 and the Treasury Regulations thereunder. If any Units are disposed of or redeemed in compliance with the provisions of this Agreement, all distributions with respect to which the record date is before the date of such disposition or redemption shall be made to the disposing Member, and all distributions with respect to which the record date is after the date of such disposition, in the case of a disposition other than a redemption, shall be made to the transferee.

4.5 Distributions .

(a) Distributions of Pre-Closing Cash . Notwithstanding anything else in this Section 4.5 to the contrary, all Pre-Closing Cash, calculated in accordance with the example set forth in Schedule 4.5(a) , shall be Distributed solely in accordance with this Section 4.5(a) , and no Pre-Closing Cash shall be included in the calculation or determination of Distributable Value or Distributable Cash for purposes of Sections 4.5(b) , 4.5(c) , or 4.5(d) . All Pre-Closing Cash that, but for this Section 4.5(a) , would be Distributed to the Members pursuant to Section 4.5(b) , 4.5(c) , or 4.5(d) shall be Distributed to the Class A Members, pro rata based on the number of Class A Units then held by each Class A Member as compared to the aggregate number of Class A Units then outstanding, at such times as such Pre-Closing Cash, but for this Section 4.5(a) , would have been Distributed pursuant to Section 4.5(b) , 4.5(c) , or 4.5(d) .

(b) Mandatory Distributions; Determination of Distributable Value .

(i) Subject to Section 4.5(a) , beginning after December 31, 2012, the Company shall make mandatory Distributions to the Members holding Units at least once per year (on such date or dates as determined by the Board in good faith) in an amount equal to at least seventy percent (70%) of the Distributable Cash, as determined by the Board in good faith on at least an annual basis. All Distributions made pursuant to this Section 4.5(b)(i) shall be allocated among the Members in accordance with Section 4.5(d)(ii) .

(ii) On or as soon as reasonably practicable following March 31, 2012, but in no event more than ten (10) days following such date, the Board shall calculate, with respect to each Facility owned or leased by the Company or a Subsidiary of the Company (or in which the Company or any Subsidiary has any interest), and with respect to which the Company or a Subsidiary has entered into a monetization transaction prior to March 31, 2012, the projected Distributable Value expected to be received by the Company through the remainder of the ten-year period for which Tax Credits are available with respect to such Facility, as of March 31, 2012, in accordance with the methodology set forth on Schedule 4.5(b) (the “ Projected Distributable Value ”), and the Projected Distributable Value, as the same may be recalculated from time to time pursuant hereto, shall at all times be calculated in accordance with the methodology set forth on Schedule 4.5(b) . After March 31, 2012, prior to making any Distribution pursuant to Sections 4.5(b)(i) , 4.5(c) or 4.5(d) , the Board shall determine in good faith, in accordance with the methodology set forth on Schedule 4.5(b) , the Projected Distributable Value, the Unrecovered Investment Balance and the Projected Investment Value (such calculations, the “ Distribution Calculations ”) and shall promptly provide the Distribution Calculations, along with relevant supporting documentation, to GS. GS shall have five (5) business days from the date of receipt of such calculations to review and to notify the Board in writing if GS disagrees with any of the Distribution Calculations (any Distribution Calculations with which GS disagrees, the “ Disputed Calculations ”). If GS does not notify the Board in writing of any disagreement within such five (5) business day period, GS will be deemed to have accepted the Distribution Calculations and Distributions of Distributable Value shall be made accordingly. If GS notifies the Board in writing of any Disputed Calculations within the aforementioned five (5) business day period, such disagreement shall be resolved pursuant to Section 4.5(b)(iii) .

(iii) As soon as reasonably practicable following any notice of Disputed Calculations to the Board, but in no event more than five (5) business days following such notice, GS shall provide the Board with its own calculation of the Disputed Calculations (such calculations, the “ GS Calculations ”), along with all supporting documentation used for the GS Calculations, and the Board and GS shall designate a third party valuation expert (a “ Valuation Expert ”) mutually agreeable to the Board and GS. If the Board and GS are unable, in good faith, to agree on a Valuation Expert within three (3) days following the Board’s receipt the GS Calculations, the Board and GS shall each designate a separate third party valuation expert, and such separate third party valuation experts shall designate, as soon as reasonably practicable but in no

event more than three (3) days following their designation, a separate third party valuation expert, and such separate third party valuation expert will be the Valuation Expert for purposes of this Section 4.5(b)(iii) . Upon designation of a Valuation Expert pursuant to this Section 4.5(b)(iii) , the Board shall provide the Valuation Expert with all supporting documentation underlying the Distribution Calculations and the GS Calculations, and the Valuation Expert shall, as soon as reasonably practicable but in no event longer than fifteen (15) days following receipt of such documentation, render a written report of its calculations of the values underlying the Disputed Calculations to the Board and GS (the “ Determined Values ”); provided, however, that if the Determined Value with respect to any Disputed Calculation is greater than both the applicable Disputed Calculation and the applicable GS Calculation, the applicable Disputed Calculation or the applicable GS Calculation, whichever is greater, with respect to such Disputed Calculation shall be the Determined Value with respect to such Disputed Calculation, and if the Determined Value with respect to any Disputed Calculation is less than both the applicable Disputed Calculation and the applicable GS Calculation, the applicable Disputed Calculation or the applicable GS Calculation, whichever is less, with respect to such Disputed Calculation shall be the Determined Value with respect to such Disputed Calculation. With respect to each Disputed Calculation, the Determined Values shall be binding on the parties hereto. In no event shall the Valuation Expert be provided with the Distribution Calculations or the GS Calculations, and each of GS and the Board shall have reasonable access to the Valuation Expert and shall be entitled to explain its methodology and assumptions underlying the Distribution Calculations and the GS Calculations to the Valuation Expert. All costs and expenses incurred pursuant to this Section 4.5(b)(iii) , including costs associated with appointing and retaining the Valuation Expert, shall be split equally between GS and the Company; provided, however, that any costs and expenses incurred by GS or the Company to retain any accounting or other advisor in connection with this Section 4.5(b)(iii) shall be borne solely by the party incurring such costs and expenses.

(i) Subject to Section 4.5(a) and, if applicable, Article VIII , if a Liquidation Event occurs, then GS will be entitled either to (1) if the Company directly receives proceeds in connection with such Liquidation Event, receive the greater of (A) a liquidation preference in an amount equal to the Unrecovered Investment Balance as of the date of such Liquidation Event (the “ Liquidation Preference ”) and (B) GS’s pro rata share (based on number of Units then held by GS as compared to the aggregate number of Units then outstanding on a fully diluted membership interest basis) of the Distributable Value from such Liquidation Event, or (2) if the Company does not directly receive proceeds in connection with such Liquidation Event, exercise the Tag-Along Right provided in Section 9.3 without first complying with Section 9.2 . If GS exercises the Tag-Along Right pursuant to (2) above and the proceeds received by GS in respect of the Class B Units Transferred by GS in the Tag-Along Sale are equal to or greater than the Unrecovered Investment Balance on the date of such Tag-Along Sale, such proceeds shall constitute the sole consideration due GS in connection with such Liquidation Event

and GS shall not be entitled to any additional Distribution or other payment in connection with such Liquidation Event. If GS exercises the Tag-Along Right pursuant to (2) above and the proceeds received by GS in respect of the Class B Units Transferred by GS in the Tag-Along Sale are less than the Unrecovered Investment Balance (or, if less than all of the Class B Units held by GS are Transferred in the Tag-Along Sale, less than the portion of the Unrecovered Investment Balance attributable to the Class B Units Transferred by GS in the Tag-Along Sale) as of the date of such Tag-Along Sale, the Company shall Distribute to GS the difference between the Unrecovered Investment Balance (or portion thereof attributable to the Class B Units Transferred by GS in the Tag-Along Sale) as of the date of the Tag-Along Sale and the proceeds received by GS in respect of the Class B Units Transferred by GS in the Tag-Along Sale (such difference, the “ Make-Whole Payment ”). For the avoidance of doubt, if GS exercises the Tag-Along Right pursuant to (2) above, the sole right of GS with respect to the Class B Units Transferred by GS is to receive the proceeds therefor in the Tag-Along Sale and, if applicable, the Make-Whole Payment. All proceeds received by GS in a Tag-Along Sale pursuant to (2) above, and any Make-Whole Payment shall be treated as a Distribution to GS for all purposes of this Agreement (including reducing the Unrecovered Investment Balance), and GS shall in no case be entitled to receive a Liquidation Preference that would be duplicative of such proceeds or Make-Whole Payment. In the event, and to the extent, that the total Liquidation Preference or proceeds from a Tag-Along Sale pursuant to (2) above and Make-Whole Payment payable to GS would exceed its Capital Account balance (after taking into account all items of income which may be allocated to GS under Section 8.2 (“ Excess Liquidation Preference ”), (i) such Excess Liquidation Preference shall be treated as the payment by the Company to such Member of a guaranteed payment for the use of capital pursuant to Section 707(c) of the Code, (ii) to the extent so treated, the Liquidation Preference shall not be treated as a Distribution pursuant to this Agreement, (iii) to the maximum extent possible consistent with the provisions of this Article IV and applicable law, any Company deduction in respect of such guaranteed payment shall be allocated to the Members other than GS, and (iv) upon final liquidation of the Company, and prior to the distribution of liquidation proceeds pursuant to Section 8.2(b)(iv) , the Company shall pay to GS an amount equal to the excess, if any, of such Excess Liquidation Preference over the portions thereof which have either given rise to income allocations under this Article IV or have been treated as a guaranteed payment pursuant to clause (ii) above, which payment shall have the effects described in clauses (i) through (iii) above.

(ii) If GS receives the Liquidation Preference or the proceeds from a Tag-Along Sale (along with any applicable Make-Whole Payment) upon the occurrence of a Liquidation Event in accordance with Section 4.5(c)(i) , then, after payment in full of the Liquidation Preference to GS, or the receipt by GS of the proceeds from the Tag-Along Sale and any applicable Make-Whole Payment, GS will not be entitled to receive any additional proceeds or Distributions with respect to such Liquidation Event. Subject to Section 4.5(a) , following payment in full of the Liquidation Preference or the proceeds from a Tag-Along Sale (and any applicable Make-Whole Payment) to GS pursuant to Section 4.5(c)(i) , the remaining Distributable Value from such Liquidation Event, if any,

shall be distributed pro rata among the other Members (not including GS) based on the number of Units then held by each such other Member as compared to the aggregate number of Units then held by all such other Members (not including GS) on a fully diluted membership interest basis.

(iii) If GS does not receive the Liquidation Preference or the proceeds from a Tag-Along Sale (and any applicable Make-Whole Payment) upon the occurrence of a Liquidation Event in accordance with Section 4.5(c)(i) , subject to Section 4.5(a) , each Member (including GS) will be entitled to receive its pro rata share (based on the number of Units then held by such Member as compared to the aggregate number of Units then held by all Members (including GS) on a fully diluted membership interest basis) of the Distributable Value from such Liquidation Event. For avoidance of doubt, no Liquidation Preference will be paid at any time after the date on which the Unrecovered Investment Balance has been reduced to zero (0).

(d) Other Distributions . Except as otherwise set forth in Sections 4.5(b) and 4.5(c) , and subject to Section 4.5(a) , the Board may (but shall not be obligated to) make Distributions at any time and from time to time as follows:

(i) Subject to Section 4.5(a) and except as provided in Section 4.5(d)(iii) , all Distributions made prior to April 1, 2012, shall be made pro rata among the Members based on the number of Units then held by each such Member as compared to the aggregate number of Units then held by all Members on a fully diluted membership interest basis.

(ii) Subject to Section 4.5(a) and except as provided in Section 4.5(d)(iii) , all Distributions made on or after April 1, 2012, shall be made as follows:

(1) If, at any time prior to such Distribution, the Unrecovered Investment Balance has been reduced to zero (0) or is less than or equal to the Projected Investment Value, then each Member will be entitled to receive its pro rata share (based on number of Units then held by such Member as compared to the aggregate number of Units then held by all Members on a fully diluted membership interest basis) of any Distributable Value (taking into account allocations of Tax Credits pursuant to this Article IV as deemed Distributions), as and when any such Distribution is made.

(2) If, at any time prior to such Distribution, the Unrecovered Investment Balance has not been reduced to zero (0) and is greater than the Projected Investment Value, then GS will be entitled to receive *. All remaining Distributable Value to be Distributed to the Members and not Distributed to GS pursuant to this Section 4.5(d)(ii)(2) shall be Distributed pro rata among the other Members (not including GS) based on the number of Units then held by each such other Member as compared to the aggregate number of Units then held by all such other Members (not including GS) on a fully diluted membership interest basis. For the avoidance of doubt, no Distributions shall be made under this Section 4.5(d)(ii)(2) at any time after the date on which the Unrecovered Investment Balance has been reduced to zero (0).

(iii) Subject to Section 4.5(a) , the Board may, from time to time in its sole discretion, Distribute available Distributable Cash to the Members in accordance with this Article IV for the purpose of payment of taxes.

(iv) The Board may, from time to time in its sole discretion, make Distributions to GS in an amount greater than GS would otherwise be entitled to receive pursuant to Sections 4.5(b) or 4.5(d) in order to decrease the Unrecovered Investment Balance more quickly than would otherwise occur if GS were to receive the amounts it would otherwise be entitled to pursuant to Sections 4.5(b) and 4.5(d) , and in the event of such increased Distribution to GS, the amount of such Distribution made to the other Members shall be decreased by the amount of such increase, pro rata among the other Members based on the amount of the Distribution each such other Member would have been entitled to but for the increased Distribution to GS. If after giving effect to any such increased Distribution to GS, the Unrecovered Investment Balance is less than the Projected Investment Value, all future Distributions of Distributable Value to GS shall be adjusted downward until such time as the Unrecovered Investment Balance is equal to the Projected Investment Value.

(v) If the Company makes any indemnification payments to any holder of Class B Units pursuant Section 8.1 of the Purchase Agreement, other than indemnification payments made by the Company to reimburse such holder of Class B Units in respect of payments made by any Investor Indemnified Party in respect of Third Party Claims (as defined in the Purchase Agreement) and any reasonable related costs and expenses thereto, the aggregate amount of such payments shall reduce the Unrecovered Investment Balance in the same manner as a Distribution to any holder of Class B Units (including GS) hereunder.

4.6 Incorrect Payments . To the extent any Distributions made pursuant to this Article IV are incorrectly paid, as determined by the Board in good faith upon review of the Company’s books and records, any Member who receives more than should have been Distributed to such Member shall promptly repay the amount of any such excess Distribution, and any such repaid amounts shall be redistributed pursuant to this Article IV or, at the election of the Board, such excess Distribution may be offset against future Distributions to the Member receiving such excess Distribution.

4.7 Limitation Upon Distributions . No Distribution shall be declared and paid unless (a) the Company remains in compliance with (i) all applicable Laws, including the Act, and (ii) that certain Credit Agreement, dated as of March 31, 2011, between the Company and CoBiz Bank, a bank doing business in the State of Colorado as Colorado Business Bank, and the Loan Documents (as defined therein), and (b) such Distribution is permitted under the terms of all Indebtedness of the Company and its Subsidiaries.

4.8 Profit Sharing Program . The parties hereto acknowledge and agree that the Board intends to implement a profit sharing program whereby up to * of the cash equivalent of the Distributable Value (as determined by the Board in good faith) of each Distribution made in accordance with this Agreement may be distributed to certain officers, employees or contractors of the Company and its Affiliates, as and when determined by the Board in good faith. Any amount distributed to employees or contractors of the Company or its Affiliates pursuant to this Section 4.8 shall be referred to herein as a “ Profit Sharing Distribution Amount .” Except for calculation of Distributable Value, the Profit Sharing Distribution Amount shall not be taken into account when making calculations with respect to Distributions made pursuant to Section 4.5 , including calculations of the Distributable Value, Projected Distributable Value, Projected Investment Value and Unrecovered Investment Balance.

4.9 Withholding and Indemnification for Payments on Behalf of a Member . The Company may withhold Distributions or portions thereof if it is required by Law to make any payment to a governmental entity that is specifically attributable to a Member (including federal withholding taxes, state personal property taxes, state and local severance or extraction taxes and state unincorporated business taxes), and each such Member hereby authorizes the Company to withhold from or pay on behalf of or with respect to such Member any such payment that the Board determines that the Company is required to withhold or pay with respect to any amount distributable or allocable to such Member pursuant to this Agreement. Any amounts withheld pursuant to this Section 4.9 will be treated as having been Distributed to such Member. To the extent that the cumulative amount of such withholding for any period exceeds the Distributions to which such Member is entitled for such period, the Company will provide notice to such Member and (i) such amount will be treated as having been Distributed to such Member as an advance against the next Distributions that would otherwise be made to such Member, and such amount shall be satisfied by offset from such next Distributions or (ii) if requested in writing by the Board, contributed by such Member to the Company within fifteen (15) days of demand therefore, provided that any such contribution will not be treated as a Capital Contribution. If a Member fails to comply with its obligation to contribute to the Company pursuant to clause (ii) above, such Member shall indemnify the Company in full for the entire amount paid by the Company (including interest, penalties and related expenses). Each Member will furnish the Board with such information as may reasonably be requested by the Board from time to time to determine whether withholding is required and the amount thereof, and each Member will promptly notify the Board if such Member determines at any time that it is subject to withholding. A Member’s obligation to indemnify and make contributions to the Company under this Section 4.9 shall survive the termination, dissolution, liquidation and winding up of the Company, and for purposes of this Section 4.9 , the Company shall be treated as continuing in existence. The Company may pursue and enforce all rights and remedies it may have against each Member under this Section 4.9 if a Member does not comply with the provisions in this Section 4.9 , including instituting a lawsuit to collect such contribution and indemnification amounts required to be paid to the Company, with interest calculated at a rate equal to the Prime Rate plus three (3) percentage points per annum (but not in excess of the highest rate per annum permitted by Law), compounded on the last day of each Fiscal Quarter.

ARTICLE V

BOARD OF MANAGERS; POWERS AND DUTIES OF MANAGERS;

APPOINTMENT OF OFFICERS

5.1 Board of Managers .

(a) General . The business and affairs of the Company shall be managed by a Board of Managers (the Board of Managers is sometimes referred to herein as the “ Board ” and the Persons appointed to the Board are referred to as the “ Managers ”). Except as specifically provided in this Agreement, the Board may exercise all powers of the Company and may do all such lawful acts and things as are not specifically required by statute or by this Agreement to be exercised or done by the Members. Unless specifically approved by the Board pursuant to the last sentence of this Section 5.1(a) , no Manager in his or her individual capacity shall have the authority to manage the Company or approve matters relating to, or otherwise to bind the Company, such powers being reserved to the Board and to such Officers and other agents of the Company as may be designated by the Board. The Board shall manage the affairs of the Company in a prudent and businesslike fashion and, subject to Section 5.6 , shall use reasonable efforts to carry out the purposes and Business of the Company. The Board may delegate authority to act to any one Manager, in accordance with the provisions of this Agreement.

(b) Duties . Each Manager shall carry out his or her respective duties in good faith, in a manner that he or she believes to be in the best interests of the Company, and with such care as an ordinarily prudent Person in a like position would use under similar circumstances. Each Manager shall devote such time to the Business and affairs of the Company as such Manager may determine, in such Manager’s reasonable discretion, is necessary for the efficient carrying on of the Company’s Business.

(c) Appointment and Qualifications . The Board shall consist of six (6) Managers. Initially, ADA shall be entitled to appoint three (3) Managers (the “ ADA Managers ”), and NexGen shall be entitled to appoint three (3) Managers (the “ NexGen Managers ”). This arrangement shall continue for so long as ADA and NexGen hold an equal number of Units. In the event that ADA and NexGen do not hold an equal number of Units, either ADA or NexGen, whichever holds the lesser number of Units, shall immediately, and without any further action by the Company, the Board or any other Member, relinquish the right to appoint one (1) Manager and the other, ADA or NexGen ( whichever holds the greater number of Units), shall immediately be entitled to appoint one (1) additional Manager. If either ADA or NexGen files or is otherwise subject to a Bankruptcy, the Member subject to such Bankruptcy shall immediately, and without any further action by the Company, the Board or any Member, relinquish the right to appoint one (1) Manager and the other, ADA or NexGen (whichever is not subject to the Bankruptcy), shall immediately be entitled to appoint one (1) additional Manager for so long as the other Member is subject to such Bankruptcy. Managers shall be appointed by ADA and NexGen annually, for the term beginning with the annual meeting of the Board as described in Section 5.2(a)(ii) , and each Manager shall hold office until his or her successor shall have been appointed and qualified or until his or her earlier death, resignation or removal. Managers shall be natural persons, over the age of eighteen (18), but Managers need not be Members of the Company or residents of the State of Colorado. The Managers as of and immediately after the Effective Date are listed on the attached Schedule 5.1(c) .

(d) Board Observer . The holders of a majority of the Class B Units outstanding from time to time shall be entitled to designate one (1) non-voting observer to the Board to observe all meetings of the Board and all committees thereof (the “ Board Observer ”). The Board Observer shall receive copies of all written materials distributed to the Managers either at or in advance of Board or committee meetings, including notices of such meetings, at the same time such written materials are distributed to the Managers.

(e) Vacancies . In the event of a vacancy in the office of any ADA Manager, a successor shall be appointed by ADA to hold office for the unexpired term of such Manager (except in the case of a vacancy resulting from a Non-payment Election, in which case the vacancy shall be filled by ADA pursuant to Section 6.10 ). In the event of a vacancy in the office of any NexGen Manager, a successor shall be appointed by NexGen to hold office for the unexpired term of such Manager. In the event of a vacancy in the Board Observer position, a successor may be appointed by the holders of a majority of the Class B Units then outstanding.

(f) Removal . Except as otherwise provided in this Section 5.1(f) , an ADA Manager may only be removed by ADA, a NexGen Manager may only be removed by NexGen (except that upon a Non-payment Election ADA shall have the right to remove one (1) NexGen Manager and fill the resulting vacancy with one (1) Manager appointed by ADA, who shall thereafter be deemed an “ADA Manager” for all purposes hereunder), and the Board Observer may only be removed by the holders of a majority of the Class B Units then outstanding. Notwithstanding the foregoing, an individual Manager or the Board Observer may be removed by the affirmative vote of the Board: (i) if such Manager or Board Observer, as the case may be, is an employee of the Company, upon the occurrence of an event that would be cause for termination of the Manager’s or Board Observer’s, as the case may be, employment for cause; (ii) if the Manager or Board Observer, as the case may be, is not an employee of the Company, (A) if the Manager willfully breaches or habitually neglects his or her duties pursuant to this Agreement, (B) if the Manager or Board Observer, as the case may be, commits an act of dishonesty or moral turpitude with respect to the Company or its Business, or fraud outside Company Business (as finally determined by a non-appealable order of a court of competent jurisdiction or as determined by a unanimous Board decision without voting privilege from the suspected Manager, if applicable), or (C) as a result of the Manager’s repeated failure to comply with the policies and procedures adopted from time to time by the Company or the terms and conditions of this Agreement and which adversely affect the performance of the Manager’s duties or responsibilities; or (iii) due to the Disability of the Manager or Board Observer, as the case may be.

(g) Resignation . A Manager may resign at any time by giving written notice to that effect to the Board. Any such resignation shall take effect at the time of the receipt of that notice or any later effective time specified in that notice, and, unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective. Any vacancy caused by any such resignation or by the death of any Manager or any vacancy for any other reason shall be filled as provided in Section 5.1(e) hereof, and any Manager so elected to fill any such vacancy shall hold office until his or her successor is elected and qualified or until his or her earlier death, resignation or removal.

5.2 Actions by Board .

(a) Action by Meetings .

(i) All meetings of the Board shall be held at the principal office of the Company or at such other place within or outside of the State of Colorado as may be determined by the Board in accordance with this Article V and set forth in the respective notice or waiver of notice of such meeting.

(ii) The annual meeting of the Board shall be held immediately following the annual meeting of the Members as set forth in Article VI . Such annual meeting of the Board shall be conducted in the same manner as provided in this Agreement for special meetings of the Board, except that the purposes of such annual meeting need be enumerated in the notice of such meeting only to the extent required by Law in the case of annual meetings.

(iii) Special meetings of the Board may be called by any Manager upon at least five (5) business days (if the meeting is to be held in person) or three (3) business days (if the meeting is to be held by conference, telephone or similar communications) oral or written notice to the Managers, or upon such shorter notice as may be approved by all of the Managers. Any Manager may waive such notice as to himself or herself. A record shall be maintained of each meeting of the Board. Business transacted at all special meetings shall be confined to the purposes stated in the notice of such meeting.

(iv) Any meeting of the Board may be held in person and/or by means of a conference, telephone or similar communication equipment by means of which all Managers and other persons participating in the meeting can hear each other, and such telephone or similar participation in a meeting shall constitute presence in person at the meeting.

(v) Written or printed notice stating the place, day and hour of the meeting and, in the case of special meetings, the purpose or purposes for which the meeting is called, shall be delivered not less than five (5) days before the date of the meeting (except as otherwise provided in clause (iii) above), and may be given telephonically, via facsimile, personally, by mail, by commercial delivery service or electronic mail, by or at the direction of the person calling the meeting, to each Manager and the Board Observer. If given by a means other than United States mail, such notice will be effective only upon receipt by the Manager to whom given during normal business hours on a business day, unless actually received by the Manager during a time other than normal business hours on a business day or on a day other than a business day, in which case notice will be deemed given as of the start of the next business day. If sent by United States mail, such notice shall be deemed to be delivered when deposited in the United States mail addressed to the Manager at his or her last known address as it appears

on the records of the Company, with postage prepaid. If given telephonically, a confirmation of the telephone call shall be delivered via mail, facsimile or electronic mail at the last address, facsimile number or electronic mail address shown in the records of the Company for the Manager being notified. Attendance of a Manager at any meeting shall constitute a waiver of notice of such meeting, except where a Manager attends a meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened.

(vi) A majority of the Managers shall constitute a quorum for the conduct of business at a meeting of the Board, and a majority of the members of any committee of the Board shall constitute a quorum for the conduct of business at a meeting of such committee. Once a quorum is present at the meeting of the Board or a committee thereof, the subsequent withdrawal from the meeting of any Manager or committee member, as applicable, prior to adjournment, or the refusal of any Manager or committee member, as applicable to vote, shall not affect the presence of a quorum at the meeting. If, however, such quorum shall not be present at any meeting of the Board or committee thereof, the Managers or committee members, as applicable, at such meeting shall have the power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until the requisite number of Managers or committee members shall be present.

(vii) At any meeting of the Board or a committee thereof at which a quorum is present, the affirmative vote of a majority of the Managers or committee members, as applicable, shall be the act of the Board or committee, unless the vote of a greater number is required by this Agreement. For purposes of voting of the Board or a committee thereof on each matter to be brought before the Board or such committee for a vote, each Manager or committee member, as applicable, shall have one (1) vote. In the event of a Stalemate, the provisions of Section 5.3 shall apply to resolve the Stalemate.

(viii) Minutes of all meetings of the Board and each committee thereof shall be kept and distributed to each Manager and the Board Observer as soon as reasonably practicable following each meeting. If no objection is raised in writing following receipt of minutes or in any event at the next meeting of the Board or committee, as applicable, then such minutes shall be deemed to be accurate and shall be binding on the Managers or members of the committee, as applicable, and the Company with respect to the matters dealt with therein.

(ix) Any Manager or the Member who elected such Manager may designate in writing an individual to act as the temporary substitute for such Manager at any meeting of the Board which such Manager is unable to attend, and attendance at any meeting of the Board by any such designated individual shall be deemed to constitute attendance at such meeting by the Manager for whom such individual is designated. Any such designated individual who attends a meeting of the Board as a temporary substitute as aforesaid shall have all the powers that the absent Manager has in respect of that meeting and any matters to be acted upon at such meeting.

(b) Actions Without a Meeting and Telephone Meetings . Notwithstanding any provision contained in this Article V , all actions of the Board provided for herein may be taken by written consent without a meeting, or any meeting thereof may be held by means of a conference telephone or other method or device provided that all Managers participating may simultaneously hear each other during the meeting (and any Manager participating through such means will be deemed to be present in person at the meeting). Any such action to be taken by the Board without a meeting shall be effective only if the written consent or consents are in writing, setting forth the action so taken, and are signed by at least one ADA Manager, on behalf of the ADA Managers, and at least one NexGen Manager, on behalf of the NexGen Managers. In the event action is taken by written consent executed by less than all of the Managers, the Managers who did not participate in taking the action shall be given written notice of the action not more than ten (10) days after the taking of the action without a meeting; provided that the failure to give such notice will not invalidate the action so taken. The Board Observer shall be given written notice of all action taken by written consent of the Board not more than five (5) days after the taking of such action; provided that the failure to give such notice will not invalidate the action so taken.

(c) Access to Information . Upon request, the Officers shall supply to a Member or Manager or the Board Observer (i) any information required to be available to the Members under the Act, and (ii) any other information requested by such Member or Manager or the Board Observer regarding the Company or its activities, provided that obtaining the information described in this clause (ii) is not unduly burdensome to the Company. During ordinary business hours, each Member and Manager and their authorized representative shall have access to all books, records and materials in the Company’s offices regarding the Company or its activities.

(d) Limitation on Actions . Nothing contained herein shall be construed as permitting any action to be taken by the Managers unless and until any required approvals of the Members have been obtained pursuant to Section 6.1 .

(e) Insurance . The Company shall maintain or cause to be maintained in force at all times, for the protection of the Company, the Managers and the Members to the extent of their insurable interests, such insurance as the Board believes is warranted for the operations being conducted.

5.3 Stalemate . In the event the Managers are unable to agree upon a matter to be decided by the Board (a “ Stalemate ”), the Managers agree to engage in discussions to attempt in good faith to negotiate a resolution of the matter in question. The meeting to do so shall be held promptly, but in no event later than ten (10) business days after the determination that a Stalemate on an issue has occurred (a “ Stalemate Determination ”). If the Managers are unable to resolve the Stalemate after reasonable attempts have been made, which shall be no more than thirty (30) days after the date of the Stalemate Determination (unless a longer or shorter time is agreed upon by unanimous consent of the Board), the Board shall utilize the services of the American Arbitration Association (“ AAA ”), in Denver, Colorado, to appoint an arbitrator to resolve the Stalemate. The Board shall immediately contact the AAA and open a proceeding to appoint a single arbitrator to decide the Stalemate. The arbitrator so appointed shall be chosen

by the Managers by mutual agreement from a list of proposed arbitrators designated by the AAA, who have expertise in the area of the Company’s Business, and to the extent feasible, taking into account the specific matter to be determined by the arbitrator. If the Managers cannot agree on an arbitrator by consent within ten (10) business days of receipt of the proposed list of arbitrators, one shall be appointed by the AAA in accordance with its Commercial Rules. The Board and the arbitrator shall meet as soon as practicable after the appointment of the arbitrator, and shall agree on the parameters of the proceeding to decide the Stalemate, with emphasis on a determination being made in as expeditious and cost-effective a manner as possible. Each of the Managers shall be entitled to present relevant information to assist the arbitrator in reaching a decision. The decision of the arbitrator shall be in writing and shall be binding on the Board and the Members. No appeal of such decision shall be taken to a court or other adjudicatory body by any Manager, Member or other Person. All costs and expenses of the arbitration shall be born by the Company.

5.4 Appointment of Committees and Officers .

(a) In the event the Board determines that it is reasonably necessary or appropriate for the conduct of the Business of the Company (including, for example, audit review, compensation recommendations, execution and delivery of contracts or other documents, federal or applicable state income or other tax returns), the Board may appoint a committee of the Managers or an officer or officers (“ Officer ”) and, if so appointed, such committees and/or Officers shall have such duties and authority as provided by the Board upon such appointment. Committee members and Officers shall serve at the discretion of the Board and may be removed with or without cause upon approval of the Board, subject, however, to the terms and conditions of any applicable employment agreement. The salaries or other compensation, if any, of the Officers of the Company shall be fixed from time to time by the Board. Notwithstanding the foregoing, any Officers or committees appointed and acting pursuant to this Section 5.4 shall be subject to the applicable limitations and approval requirements set forth in Sections 5.6 and 6.1 .

(b) No third party dealing with the Company shall be required to ascertain whether an Officer is acting in accordance with the provisions of this Agreement. All third parties may rely on a document executed by an Officer as binding on the Company. This Section 5.4(b) shall not apply to third parties who are Affiliates of a Member, Manager or Officer.

5.5 Compensation . The Managers shall be entitled to such compensation as shall be determined by all of the Members from time to time.

5.6 Board Decisions . No Officer, Manager, Member or any other Person shall have the authority to bind or take any action on behalf of the Company with respect to any of the following matters unless such matter, in each case and from time to time, has been approved by the Board:

(a) any Change of Control of the Company, or any sale, lease, license or other Transfer of all or substantially all of the assets or equity, as applicable, of any Subsidiary of the Company or any division or business segment of the Company or any Subsidiary of the Company that would result in proceeds to the Company or such Subsidiary, as applicable, in excess of the Board Decision Threshhold;

(b) the purchase, lease or other acquisition of real property the cost of which exceeds the Board Decision Threshold;

(c) the incurrence of any Indebtedness by the Company (including contractual vendor financing) in any Fiscal Year in an aggregate amount which exceeds the Board Decision Threshold;

(d) the creation of any Lien on any property or assets of the Company other than (i) purchase money security interests and other Liens created or existing at the time of acquisition of an asset, but only to the extent the aggregate Indebtedness of the Company secured by all such purchase money security interests and such other Liens does not exceed at any time the Board Decision Threshold; and (ii) material mans’, mechanics’, contractors’, operators’, tax and similar Liens or charges arising in the ordinary course of business or by operation of law with respect to amounts not yet due and payable;

(e) the providing of any guaranty (or other obligation that, in economic effect, is substantially equivalent to a guaranty) of any amount owed by or any obligation of any Person, but only to the extent the aggregate amount of such guaranty or other obligation exceeds the Board Decision Threshold;

(f) the settlement of any claim against the Company for a settlement in excess of the Board Decision Threshold;

(g) the commencement of any lawsuit, arbitration or other legal action against any Person; provided that a suit or legal action against a Member does not require Board approval unless the purpose of such action is to collect amounts due the Company from the Member or to enforce any right of the Company hereunder; provided further that any Member shall be entitled to bring a suit on behalf of itself, or on behalf of the Company as, or in the nature of, a derivative suit, against another Member;

(h) the Company entering into a business or expanding the business of the Company outside the scope of the Business;

(i) entering into any futures, swap or other hedging arrangements of any type, or financial derivative instruments or agreements of any type where the total potential liability exposure of the Company exceeds the Board Decision Threshold;

(j) the approval of any contract or transaction between the Company and any Member or Manager or their respective Affiliates, or any amendment or modification of any such contract or transaction;

(k) any removal of or designation of a successor to the TMP pursuant to Section 7.3 ;

(l) the designation, removal or replacement of any Officer pursuant to Section 5.4 and the approval of any compensation of any Officer;

(m) the filing by the Company of any petition for relief under Bankruptcy Law or any other present or future federal or state insolvency, bankruptcy or similar Law;

(n) making any other decision with respect to the Company that specifically requires the approval of the Board or Members pursuant to this Agreement;

(o) issuance or grant, or commitment to issue or grant, to any Person of (i) any additional Units (whether or not as Voting Units) or other security of the Company, (ii) the right to receive or subscribe for Units, or (iii) any security convertible into or exchangeable for Units or other securities of the Company that is not issued and outstanding as of the Effective Date; or

(p) entering into any contract, agreement or other obligation of any nature or duration in which the aggregate financial obligation of the Company exceeds or could potentially exceed the Board Decision Threshold.

5.7 Exculpation; Limitation of Liability . Except as otherwise provided herein or in the other Transaction Documents, and to the maximum extent permitted by the Act, no present or former Manager or Officer, nor any such Manager’s Affiliates, employees, agents or representatives, shall be liable to the Company or to any Member for any good faith act or omission performed or omitted, nor for any errors of judgment, by such Person in its capacity as a Manager or Officer; provided that, except as otherwise provided herein, such limitation of liability shall not apply to the extent the act or omission was attributable to such Person’s gross negligence or reckless conduct, intentional misconduct or knowing violation of Law, in each case as determined by a final judgment, order or decree of an arbitrator or a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected).

5.8 Reliance . In performing his or her duties, each of the Managers and Officers shall be entitled to rely in good faith on the provisions of this Agreement and on information, opinions, reports or statements (including financial statements and information, opinions, reports or statements as to the value or amount of the assets, liabilities, Profit or Loss of the Company or any facts pertinent to the existence and amount of assets from which distributions to Members might properly be paid), of the following other Persons or groups: (i) one or more other Managers, Officers or employees of the Company, (ii) any attorney, independent accountant or other Person employed or engaged by the Company, or (iii) any other Person who has been selected with reasonable care by or on behalf of the Company, in each case as to matters which such relying Person reasonably believes to be within such other Person’s professional or expert competence. No individual who is a Manager or an Officer, or any combination of the foregoing, shall be personally liable under any judgment of a court, or in any other manner, for any debt, obligation or liability of the Company, whether that debt, liability or other obligation arises in contract, tort or otherwise, solely by reason of being a Manager or an Officer or any combination of the foregoing.

ARTICLE VI

MEMBERS; TYPES OF UNITS;

ISSUANCE OF UNITS AND OPTIONS TO PURCHASE UNITS

6.1 Authority and Power . Except as expressly provided in this Section 6.1 , it is not intended that the Members will participate in the conduct of the business of the Company or have any power or authority, by reason of their status as a Member, to bind or obligate the Company or to take part in the operations, activities, contracts, decisions or other matters involving the business of the Company. Notwithstanding anything else herein, the Company and each Member holding Class A Units hereby agree not to consummate or permit any Change of Control of the Company to occur prior to *.

(a) General Member Approval . The Company shall not take or permit to be taken any of the following actions without first having obtained the affirmative vote or written consent of all of the Members (including both Class A Members and Class B Members):

(i) effect a Change of Control of the Company; provided, however, that any Change of Control of the Company effected after December 31, 2012 shall require only the vote or consent of the Class A Members;

(ii) act in contravention of or in a manner not authorized by this Agreement;

(iii) liquidate, dissolve or wind up the Company;

(iv) file a voluntary petition or otherwise initiate proceedings to have the Company adjudicated bankrupt or insolvent, or consent to the institution of Bankruptcy or insolvency proceedings against the Company, or file a petition seeking or consenting to reorganization or relief of the Company as debtor under any applicable federal or state Law relating to Bankruptcy, insolvency, or other relief for debtors with respect to the Company, or seek or consent to the appointment of any trustee, receiver, conservator, assignee, sequestrator, custodian, liquidator (or other similar official) of the Company or of all or any substantial part of the properties and assets of the Company, or make any general assignment for the benefit of creditors of the Company, or admit in writing the inability of the Company to pay its debts generally as they become due or declare or effect a moratorium on the Company debt or take any action in furtherance of any such action;

(v) amend or modify in any way this Agreement or the Articles (other than minor clarification changes that do not result in any adverse consequences to the Class B Members);

(vi) change the purposes of the Company from the purposes stated in Section 2.6 ;

(vii) issue or grant, or commit to issue or grant, to any Person (i) any additional Units (whether or not as Voting Units) or other securities of the Company, (ii) the right to receive or subscribe for Units, or (iii) any security convertible into or exchangeable for Units or other securities of the Company that is not issued and outstanding as of the Effective Date;

(viii) perform any act that would subject any Member to any liability to which such Member has not consented; or

(ix) change the Accounting Firm or change the certified public accountant appointed to audit the annual financial statements of the Company, other than to one of the big four, in accordance with Section 7.2(c) .

(b) GS Approval . In addition to the actions requiring prior Member approval pursuant to Section 6.1(a) , for so long as any Class B Units remain outstanding, neither the Company nor any Member shall take or permit to be taken any of the following actions without first having obtained the written consent of all of the Class B Members:

(i) engage in any transaction or series of related transactions with Affiliates of the Company; provided, however, that the Company and its Subsidiaries may continue to perform in accordance with agreements with Affiliates of the Company that are in existence on the Effective Date and described in Schedule 6.11(a) ;

(ii) consummate a Liquidation Event (other than a transaction or series of related transactions that constitutes a Change of Control of the Company, but to which the Company is not a party) that does not involve payment to the Members holding Class B Units of the entire remaining amount, if any, of the Unrecovered Investment Balance after giving effect to such Liquidation Event;

(iii) settle any material civil litigation or settle any criminal proceeding;

(iv) materially change the business of the Company;

(v) acquire equity or assets of another Person in a transaction or transactions involving, individually or in the aggregate, more than twenty-five percent (25%) of the Distributable Cash for the year in which such acquisition occurs;

(vi) the Company or any Subsidiary of the Company incurring any Indebtedness, other than Indebtedness incurred to the Company or a Subsidiary of the Company, if the Unrecovered Investment Balance at the time of such incurrence (pro forma for any Distributions made out of such Indebtedness) has not been reduced to zero (0) and is greater than the Projected Investment Value;

(vii) sell, lease, license or otherwise Transfer (other than a pledge, grant of security interest, or similar encumbrance in connection with an incurrence of Indebtedness that does not require the written consent of all Class B Members pursuant to

clause (vi) above) all or substantially all of the assets or equity, as applicable, of any Subsidiary of the Company or any division or business segment of the Company or any Subsidiary of the Company, except in connection with any monetization transaction in connection with the Business of the Company, and except for transfers of assets from the Company or any Subsidiary of the Company to any Subsidiary of the Company or the Company in connection with the development of Facilities in the ordinary course of the Company’s Business;

(viii) adjust the sharing ratio of any member of any Subsidiary of the Company;

(ix) make, or permit any member of any Subsidiary of the Company to make, a capital contribution to any Subsidiary of the Company, other than capital contributions (1) made pro rata in accordance with the capital accounts of the members of such Subsidiary as of the Effective Date and (2) not in excess of $5,000 per Subsidiary per year for general corporate purposes or the development of Facilities in the ordinary course of the Company’s Business in amounts determined in good faith as reasonably necessary for such development;

(x) amend or modify in any way the operating agreement or articles of organization of any Subsidiary of the Company, but only if such amendment or modification has a negative effect on the economic or voting rights of the Company with respect to such Subsidiary; or

(xi) a NexGen Change of Control on or before December 31, 2012.

(c) Notwithstanding anything else in this Agreement, the Company and its Subsidiaries shall not be prohibited from incurring Indebtedness if the Unrecovered Investment Balance at the time of such incurrence (pro forma for any Distributions to the Members made out of the proceeds of such Indebtedness) has been reduced to zero (0) or is less than or equal to the Projected Investment Value.

6.2 Voting; Approval of the Members . Except as otherwise provided herein, each Member holding Voting Units shall initially be entitled to one vote for each Voting Unit held by such Member on each matter expressly provided by this Agreement to be brought before the Members for a vote, approval or consent. At such time as the Sharing Ratios of the Members holding Voting Units are no longer directly proportional to the portion of Voting Units held by the Members, the Members holding Voting Units shall be entitled to cast that number of votes based on their respective Sharing Ratios, with the total number of votes to be cast equal to one hundred (100), and each Member casting that number of votes equal to their respective Sharing Ratios (including fractional votes), expressed as a percentage.

6.3 Limitation of Liability . Except as otherwise provided in the Act, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and no Member shall be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a

Member of the Company, other than such Member’s obligation to make Capital Contributions to the Company pursuant to the terms and conditions hereof. Except as otherwise provided in this Agreement, a Member’s liability (in its capacity as a Member) for debts, liabilities and losses of the Company shall be limited to such Member’s share of the Company’s assets.

6.4 Actions by Members .

(a) Action by Meetings .

(i) All meetings of the Members shall be held at the principal office of the Company or at such other place within or without the State of Colorado as may be determined by the Board in accordance with this Article VI and set forth in the notice or waiver of notice of such meeting. All Members shall be entitled to attend meetings of the Members.

(ii) The annual meeting of the Members shall be held at such time and date as shall be designated by the Chairman, from time to time, and stated in the notice of the meeting. The “ Chairman ” shall be elected by majority vote of the Members and shall continue in such capacity until a successor is elected; provided that the Chairman may be removed and replaced at any time, with or without cause, by majority vote of the Members. Until otherwise designated, Charlie McNeil shall serve as Chairman. Such annual meeting shall be called in the same manner as provided in this Agreement for special meetings of the Members, except that the purposes of such meeting need be enumerated in the notice of such meeting only to the extent required by Law in the case of annual meetings.

(iii) Special meetings of the Members may be called by the Chairman, the Managers (by vote of a majority) or any Member holding at least ten percent (10%) of the then outstanding Voting Units. Members who own only Non-voting Units or who own less than ten percent (10%) of the then outstanding Voting Units shall not be entitled to call a meeting of the Members. Non-voting Units will not be counted for purposes of determining the ten percent (10%) requirement. Business transacted at all special meetings shall be confined to the purposes stated in the notice of such meeting.

(iv) Written or printed notice stating the place, day and hour of the meeting and, in the case of special meetings, the purpose or purposes for which the meeting is called, shall be delivered not less than ten (10) nor more than sixty (60) days before the date of the meeting, either personally or by mail, by or at the direction of the person calling the meeting, to each Member. If delivered personally, such notice shall be deemed to be delivered when actually delivered to the recipient, and, if mailed, such notice shall be deemed to be delivered when deposited in the United States mail addressed to the Member at his address as it appears on the transfer records of the Company, with postage prepaid.

(v) Members holding a majority of the outstanding Voting Units of the Company at the time of the meeting shall constitute a quorum for the purpose of

conducting business at the meetings of the Members, except as otherwise provided by Law or the Articles. Once a quorum is present at the meeting of the Members, the subsequent withdrawal from the meeting of any Member prior to adjournment or the refusal of any Member to vote shall not affect the presence of a quorum at the meeting. If, however, such quorum shall not be present at any meeting of the Members, the Members entitled to vote at such meeting shall have the power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until the holders of the requisite amount of Units shall be present or represented. Except for any matter for which the affirmative vote of the holders of a specified portion of the Units entitled to vote is specifically required by the Act, the Articles or this Agreement, at any meeting of the Members at which a quorum is present, the vote of the Members owning Voting Units entitled to cast a majority of the votes entitled to be cast by all Voting Units represented at the meeting (in person or by proxy) shall be the act of the Members. Members may vote or appear at a meeting of the Members either in person or by written proxy held by and appointing another Member as proxy, provided that the Member holding the proxy is present in person or by telephone. For avoidance of doubt, except as otherwise specifically provided in this Agreement or required by the Act, only Members holding Voting Units shall be entitled to vote on or consent to any item requiring the vote or consent of the Members, and such Members shall be entitled to vote and/or consent only with respect to the Voting Units held by such Members and not with respect to any Non-voting Units held by such Members.

(vi) The Chairman shall make, at least ten (10) days before each meeting of Members, a complete list of the Members entitled to vote at such meeting, or any adjournment of such meeting, arranged in alphabetical order, with the address of, and the Units held by each, Member, which list, for a period of ten (10) days prior to such meeting, shall be kept on file at the registered office of the Company and shall be subject to inspection by any Member at any time during usual business hours. Such list shall also be produced and kept open at the time and place of the meeting and shall be subject to inspection of any Member during the whole time of the meeting. However, failure to comply with the requirements of this clause (vi) shall not affect the validity of any action taken at such meeting.

(vii) The Company shall be entitled to treat the holder of record of any Units as the holder in fact of such Units for all purposes, and accordingly shall not be bound to recognize any equitable or other claim to or interest in such Units on the part of any other person, whether or not it shall have express or other notice of such claim or interest, except as expressly provided by this Agreement or the laws of the State of Colorado.

(b) Actions Without a Meeting and Telephone Meetings . Notwithstanding any provision contained in this Article VI , all actions of the Members provided for herein may be taken by written consent without a meeting, or any meeting of the Members may be held by means of a conference telephone or other method or device provided that all Members participating may simultaneously hear each other during the meeting (and any Member participating through such means will be deemed to be present in person at the meeting). Any

such action to be taken by the Members without a meeting shall be effective only if the written consent or consents are in writing, set forth the action so taken, and are signed by the holder or holders of Units constituting not less than the minimum votes that would be necessary to take such action at a meeting at which the holders of all Units entitled to vote on or consent to the action were present and voted. In the event action is taken by written consent executed by less than all of the Members entitled to vote on such action, the Members who did not participate in taking the action shall be given written notice of the action not more than then (10) days after the taking of the action without a meeting; provided that the failure to give such notice will not invalidate the action so taken.

6.5 Authorized Units; Modification of Units; Issuance of Additional Units; Admission of Additional Members . By amendment to this Agreement, the Members shall determine, from time to time, the number of authorized Units of the Company and the attributes of any such authorized Units. On the date of this Agreement, the Members agree that Exhibit A reflects the number and class of Units authorized, issued and outstanding. Additional Members may be admitted, existing Units may be modified, and additional Units may be issued and/or created only as approved by the Members; provided that the modification of any existing Units that would be adverse to the holders of such Units shall require the prior written approval of a majority of the Units so affected; and provided further that issuance of additional Units is subject to Member approval pursuant to Section 6.1(a) . When any such action is so approved and when an additional Member (or Members) is admitted, Exhibits A and B shall be updated to reflect the appropriate information, and as so amended, shall be attached to, and become a part of, this Agreement. The foregoing notwithstanding, no Person shall become a Member, by Transfer of Units to such Person, issuance of Units to such Person or otherwise, until such Person has agreed to be bound by the terms and conditions of this Agreement by either executing a counterpart hereof or executing a joinder to this Agreement, in form and substance acceptable to the Board.

6.6 Preemptive Rights .

(a) Each Member shall have the preemptive right to acquire its pro rata share, based on the number of Units then held by each such Member as compared to the aggregate number of Units then held by all Members on a fully diluted membership interest basis, of any Units or other securities which are proposed to be issued by the Company from and after the Effective Date, on the same terms and conditions set by the Board and as notified pursuant to Section 3.2 .

(b) If the Company proposes to issue any Units or other securities, it shall give each Member written notice of its intention to do so, describing the Units or other securities to be issued, the price of such Units or other securities and the terms and conditions upon which the Company proposes to issue the same. Each Member shall have fifteen (15) days from the giving of such notice to agree to purchase its pro rata share of the Units or other securities for the price and upon the terms and conditions specified in the notice by giving written notice to the Company and each other Member and stating therein the quantity of Units or other securities to be purchased. The purchase price for all Units or other securities purchased by a Member under this Section 6.6 shall be payable in cash. Notwithstanding the foregoing, the Company shall not be required to offer or sell such Units or other securities to any Member who would cause the Company to be in violation of applicable federal or state securities Laws by virtue of such offer or sale.

(c) If not all of the Members elect to purchase their pro rata share of the Units or other securities to be issued by the Company, then the Company shall promptly notify in writing the Members who do so elect to purchase their pro rata share and shall offer such Members the right to acquire the unsubscribed Units or other securities. Each Member to which such offer is made shall have five (5) days after receipt of such notice to notify the Company of its election to purchase all or a portion of the unsubscribed Units or other securities. If the Members fail to exercise in full the preemptive rights provided in this Section 6.6 , the Company shall have ninety (90) days following delivery of the notice pursuant to Section 6.6(b) to issue and sell the unsubscribed Units or other securities, at a price and upon terms and conditions not materially more favorable to the purchasers thereof than specified in the Company’s notice to the Members pursuant to Section 6.6(b) . If the Company has not sold such Units or other securities within ninety (90) days of delivery of the notice provided pursuant to Section 6.6(b) , the Company shall not thereafter issue or sell any Units or other securities without first offering such Units or other securities to the Members as provided in this Section 6.6 .

(d) The preemptive rights of each Member under this Section 6.6 may be transferred only to the Persons, and shall be subject to the same restrictions, as any Transfer of Units pursuant to Article IX .

6.7 Rights Attributable to Units . Units created or issued pursuant hereto will have such rights, including voting rights, as approved by the Board. If any Units issued by the Company in accordance herewith have any characteristics which are different from previously issued Units (other than voting rights), such Units shall be described in an amendment or addendum to this Agreement, which shall be approved by the Board and all of the Members.

6.8 Certificates Representing Units . The Board may, at its election and discretion, issue or cause the Company to issue to the Members certificates representing Units. Any certificates representing Units shall bear the following legend:

“THE UNITS REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED ON , , HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER APPLICABLE STATE SECURITIES LAWS (“STATE ACTS”) AND MAY NOT BE SOLD, ASSIGNED, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR STATE ACTS OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE TRANSFER OF THE UNITS REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE CONDITIONS SPECIFIED IN THE SECOND AMENDED AND RESTATED OPERATING AGREEMENT, AS AMENDED, MODIFIED AND/OR RESTATED FROM TIME TO TIME, OF CLEAN COAL SOLUTIONS, LLC (THE “COMPANY”), BY AND AMONG THE COMPANY AND ITS MEMBERS (THE “LLC AGREEMENT”), A COPY OF WHICH SHALL BE FURNISHED BY THE COMPANY UPON WRITTEN REQUEST AND WITHOUT CHARGE.”

To the extent applicable, certificates representing Units may also bear a legend in substantially the following form:

“THE UNITS REPRESENTED BY THIS CERTIFICATE MAY ALSO BE SUBJECT TO CERTAIN REDEMPTION RIGHTS, FORFEITURE PROVISIONS, RESTRICTIONS ON TRANSFER, DRAG-ALONG RIGHTS, TAG-ALONG RIGHTS, VOTING AND OTHER TERMS AND CONDITIONS SET FORTH IN THE LLC AGREEMENT AND/OR A SEPARATE AGREEMENT WITH THE HOLDER, A COPY OF WHICH SHALL BE FURNISHED BY THE COMPANY UPON WRITTEN REQUEST AND WITHOUT CHARGE.”

If a Member holding Units evidenced by a certificate delivers to the Company an opinion of counsel, satisfactory in form and substance to the Board (which opinion requirement may be waived by the Board), that no subsequent Transfer of such Units will require registration under the Securities Act, the Company will promptly upon such contemplated Transfer deliver a new certificate evidencing the Units which does not bear the portion of the restrictive legend relating to the Securities Act set forth in this Section 6.8 .

6.9 Restrictions on Transfer . No Transfer of Units may be made by any Member except in accordance with and as provided in Article IX and applicable securities Laws.

6.10 Effect of a Non-payment Election by NexGen . Immediately upon the occurrence of a Non-payment Election by NexGen, (i) one (1) of the NexGen Managers shall resign as a Manager and such vacancy shall be filled by ADA, and (ii) NexGen shall be deemed to have resigned as the Tax Matters Partner. Upon a Non-payment Election, Exhibit A and Schedule 5.1(c) shall be immediately amended to reflect the Transfer of Units resulting from the Non-payment Election.

6.11 Compensation and Reimbursement of Members . No Member or Affiliate of a Member will be entitled to compensation or reimbursement for the involvement of its officers, employees, contractors or agents in the business and affairs of the Company except as set forth in this Section 6.11 .

(a) Any Member or Affiliate of a Member shall be entitled to reimbursement for (i) the costs of such Member’s or Affiliate’s officers, employees, contractors or agents who, with all required Board and Member approval, are deployed on a dedicated basis ( i.e. , exclusively or primarily) over a substantial period of time to the business and affairs of the Company (with such time charged to the Company pro rata based on the officer’s, employee’s, contractor’s or agent’s actual compensation and the portion of such Person’s time devoted to the business and affairs of the Company), and (ii) direct out-of-pocket expenses, including travel expenses and similar incidental expenses (but excluding the costs of salary, benefits and other overhead), incurred by such Member or Affiliate or any officer, employee, contractor or agent

thereof in direct pursuit of the Company’s business objectives. For avoidance of doubt, and not as a limitation on the right to reimbursement with respect to any other arrangement, the Members and their Affiliates shall be entitled to reimbursement under this Section 6.11(a) for those arrangements set forth on Schedule 6.11(a) . All such arrangements contemplated by this Section 6.11(a) shall be on terms comparable to those that would be expected to be obtained by the Company for similar services in an arms’ length transaction with a non-Affiliate of the Company.

(b) Any Member or Affiliate of a Member shall be entitled to recover a reasonable allocation or charge from the Company, as determined by the Board, for any administrative services provided by such Member or Affiliate for the benefit of the Company that are of the type and character of the services set forth on Schedule 6.11(a) . All such arrangements contemplated by this Section 6.11(b) shall be on terms comparable to those that would be expected to be obtained by the Company for similar services in an arms’ length transaction with a non-Affiliate of the Company.

(c) If any Affiliate of a Member is, with all required Board and Member approval, engaged by the Company to provide services to the Company, then, so long as such services are provided to the Company on terms at least as favorable to the Company as those that could reasonably be expected to have been obtained in an arms’ length transaction with a non-Affiliate, such Affiliate shall be entitled to receive reasonable and customary fees or other compensation from the Company as consideration for the services actually provided by such Affiliate, subject to any terms and conditions of such engagement approved by the Board and Members, and provided that such services are of the type and character of the services set forth on Schedule 6.11(a) .

6.12 Force Majeure . If any party hereto is prevented or delayed in the performance of any of its obligations under this Agreement by Force Majeure and if such party gives written notice thereof to the other parties hereto within twenty (20) days of the first day of such event specifying the matters constituting Force Majeure, together with such evidence as it reasonably can give, then the party so prevented or delayed will be excused from the performance or punctual performance, as the case may be, as from the date of such notice for so long as such Force Majeure continues; provided, however, that Force Majeure shall not relieve any party of the obligation to make any payments required hereunder unless normal banking transactions are not available.

ARTICLE VII

RECORDS, FINANCIAL STATEMENTS, TAX MATTERS, AND FISCAL YEAR

7.1 Records . The Board shall cause to be kept accurate and complete books of account of the Company wherein shall be recorded all of the contributions to the capital of the Company and all of the transactions of the Company. All Company books and records shall be kept at the principal place of business of the Company, or at such other place as determined by the Board from time to time, and each Member and its authorized representatives shall have, at all times during reasonable business hours, free access to and the right to inspect and copy such books and records.

7.2 Financial Statements .

(a) Monthly Financial Statements . On or before the thirtieth (30 ^th ) day following the end of each month, the Board (or a designated Officer) shall prepare or cause the Company’s bookkeeper or accountant to prepare, and deliver to the Board and the Members, financial statements as of the end of the preceding month, consisting of the following statements: (i) balance sheet; (ii) statement of operations (profit and loss); and (iii) statement of cash flows. The profit and loss and cash flow statements shall include cumulative figures for the year to date. Such financial statements shall be prepared in accordance with GAAP, except that such financial statements may not contain all footnotes required by GAAP and may be subject to normal year-end audit adjustments. In addition, the Board (or a designated Officer) shall prepare and provide the Members with a monthly and year-to-date statement showing actual versus budgeted expenditures by categories, prepared in a manner consistent with any written budget approved by the Board.

(b) Annual Financial Statements . On or before the forty fifth (45 ^th ) day following the end each Fiscal Year, the Board (or a designated Officer) shall prepare or cause the Company’s bookkeeper or accountant to prepare, and deliver annual financial statements (in draft form) to the Members as of the end of the preceding Fiscal Year and for the entire Fiscal Year then ended, consisting of the following statements: (i) balance sheet; (ii) statement of operations (profit and loss); (iii) statement of cash flows; and (iv) statement of Capital Accounts for each Member. Such balance sheets, statements of operations (profit and loss) and statements of cash flows shall be prepared in accordance with GAAP, except that such balance sheets, statements of operations (profit and loss) and statements of cash flows may be subject to normal year-end audit adjustments. The Members shall review such draft financial statements and shall tender any comments thereto to the Board, who shall then finalize the statements so that they may be submitted for audit.

(c) Audit . The Company shall cause the annual financial statements of the Company to be audited by Clifton Gunderson LP. The expense of any such audit shall be borne by the Company.

7.3 Tax Matters .

(a) Tax Returns and Information .

(i) The Board shall engage Clifton Gunderson LP or one of the big four accounting firms (“ Accounting Firm ”) to prepare all Tax and information returns, including a Schedule K-1 for each Member showing the amount of Company income, gain, loss, deduction or credit allocated or charged to such Member pursuant to Article IV of this Agreement and the amount of any Distributions made to such Member during such Fiscal Year, and other Tax filings required to be filed by the Company with the appropriate taxing authorities. Each Member shall furnish to the Company within ten (10) days after the date requested all pertinent information in its possession relating to the Company’s operations that is necessary to enable the Company’s tax returns to be timely prepared and filed. Final drafts of all material income tax returns will be provided to GS

for review and comment no later than sixty (60) days prior to the due date for filing such return (including extensions). GS shall provide comments within thirty (30) days of receipt of the final draft. Accounting Firm shall file all Tax returns, provided that all Tax returns and filings subject to GS review shall not be filed without the prior written consent of GS, such consent not to be unreasonably withheld or delayed. In the event that GS does not consent to a Tax return or filing, as soon as reasonably practicable following GS’s notice thereof to the Board, but in no event more than five (5) days following such notice, the Board and GS shall designate a nationally recognized accounting firm (other than the Accounting Firm) mutually agreeable to the Board and GS (“ Third Party Accountant ”), and the Board shall provide the Third Party Accountant with all supporting documentation underlying the subject matter of the dispute. Third Party Accountant shall, as soon as reasonably practicable but in no event longer than fifteen (15) days following receipt of such documentation, render a written report specifying the tax treatment of the disputed matter, which shall be binding on the parties hereto. In the event a Third Party Accountant is designated pursuant to this Section 7.3(a)(i) , the costs, expenses and fees of such Third Party Accountant shall be borne and paid solely by GS.

(ii) The Company shall use reasonable efforts to deliver all Tax returns and schedules to the Members within thirty-five (35) days after audited financial statements of the Company are available for such Fiscal Year; provided, however, that draft Schedule K-1, and any similar schedules or other information requested by GS for the preparation of its Tax returns or financial statements, including state apportionment information, shall be provided to GS within sixty (60) days after the end of the Company’s Fiscal Year.

(iii) Each Member will report its distributive share of Company items of income, gain, loss deduction and credit on its separate Tax returns in a manner consistent with the reporting of such items to it by the Company.

(iv) The Company shall bear the costs of the preparation and filing of Tax returns, except for any expenses relating to a Third Party Accountant, which shall be borne by GS pursuant to Section 7.3(a)(i) .

(b) Tax Elections . The Company shall make the following elections on the appropriate forms or tax returns:

(i) to adopt the Fiscal Year as the Company’s fiscal year;

(ii) to adopt the accrual method of accounting and to keep the Company’s books and records on the U.S. federal income tax method;

(iii) if there is a distribution of Company property as described in Code Section 734 or a transfer of Units as described in Code Section 743, upon request by notice from any Member, to elect, pursuant to Code Section 754, to adjust the basis of Company property; and

(iv) any other election the Board may deem appropriate and in the best interests of the Members.

(i) The “Tax Matters Partner” (“ TMP ”) of the Company pursuant to Code Section 6231(a)(7) shall be a Member designated from time to time by the Members. NexGen is hereby designated as the initial TMP. The TMP shall take such action as may be necessary to cause to the extent possible each other Member to become a notice partner within the meaning of Code Section 6231(a)(8). The TMP shall inform each other Member of all significant matters, including any pending or threatened audit or other proceeding, that may come to its attention in its capacity as Tax Matters Member by giving notice and a reasonably detailed account thereof on or before the fifth day after becoming aware thereof and, within that five-day time period, shall forward to each other Member copies of all significant written communications it may receive in that capacity. Any Member owning at least ten percent (10%) of the Units may, at its election and at its cost and expense, participate in any audit or other proceeding.

(ii) The TMP shall take no action without the authorization of the Board, other than such action as may be required by Law. The TMP shall not enter into any extension of the period of limitations for making assessments on behalf of the Members without first obtaining the consent of each Member. The TMP shall not bind any Member to a settlement agreement without obtaining the consent of such Member. Any Member that enters into a settlement agreement with respect to any Company item (within the meaning of Code Section 6231(a)(3)) shall notify the other Members of such settlement agreement and its terms within ninety (90) days from the date of the settlement.

(iii) Any Member intending to file a petition under Code Sections 6226 or 6228 or other Code section with respect to any item involving the Company shall notify the other Members of such intention and the nature of the contemplated proceeding. In the case where the TMP is the Member intending to file such petition on behalf of the Company, such notice shall be given within a reasonable period of time to allow the other Members to participate in the choosing of the forum in which such petition will be filed.

(iv) No Member shall file a notice of inconsistent treatment under Code Section 6222(b).

(v) In the event the Company has been dissolved and wound up, or is otherwise unable to fund expenses incurred in a proceeding concerning tax matters, each Member shall be responsible for its pro-rata share of any and all amounts reasonably incurred by the Tax Matters Partner in any such proceeding, based on the number of Units then held by a Member as compared to the aggregate number of Units then held by all Members on a fully diluted membership interest basis. The Members (or former members, in the case where the Company has been dissolved and wound up) shall immediately pay such amounts upon request of the Tax Matters Partner.

(d) Prohibited Transactions . The Company shall not participate in any transaction that is substantially similar to a “listed transaction” under Section 6011 of the Code and the Treasury Regulations thereunder, or any transaction requiring disclosure under Treasury Regulation Section 1.6011-4.

7.4 Bank Accounts . The Managers shall open and maintain a bank account or accounts in the name of the Company in a commercial bank or banks, which bank or banks shall be insured by an agency of the United States government, as determined by the Board in which shall be deposited all funds of the Company. The Managers shall designate one or more Persons to have the authority to disburse funds from such accounts for the Company purposes specified in this Agreement. There shall not be deposited in any such accounts any funds other than funds belonging to the Company and no other funds shall in any way be commingled with such Company funds. The Company may invest such funds, as it deems appropriate, in short-term certificates of deposit, government obligations or prime grade commercial paper.

ARTICLE VIII

DISSOLUTION AND LIQUIDATION

8.1 Dissolution .

(a) The Company shall be dissolved upon the earliest to occur of any of the following events:

(i) the sale or other disposition of all or substantially all of the assets of the Company, in one transaction or a series of related transactions, and, if any deferred payment is received in connection with such sale or other disposition, the receipt of the final installment or other deferred payment from such sale or other disposition;

(ii) the unanimous consent of the Members;

(iii) the judicial dissolution of the Company pursuant to the Act; or

(iv) the termination, dissolution, death, permanent disability or Bankruptcy of any of the Members. Upon the occurrence of any event described in this Section 8.1(a)(iv) , the Members holding Voting Units (excluding, for this purpose, the Units held by the Member with respect to which the event has occurred) may, within ninety (90) days after such event, elect to continue the business of the Company. If the business of the Company is continued pursuant to this Section 8.1(a)(iv) , the Member with respect to whom the event occurred shall retain and be entitled to its share of the profits, losses and distributions of the Company to the same extent as though held by the Member, except that the successor to or representative of said Member shall be a Non-voting Member from and after the occurrence of the event.

8.2 Liquidation .

(a) Except as otherwise provided herein, upon the dissolution of the Company, no further business shall be conducted by the Company except for the taking of such action as shall be necessary for the winding up of the affairs of the Company and the distribution of its assets to the Members pursuant to the provisions of this Section 8.2 . The Members shall appoint a Person (who may, but need not, be a Member) to act as liquidating trustee who shall have full authority to wind up the affairs of the Company and to make final distribution of the Company’s assets as provided herein. The liquidating trustee may sell all of the assets of the Company, at the best price available, or distribute all or part of the Company’s assets in kind; provided that, any such sale shall be made only with ten (10) days advance written notice to the Members. Any gain or loss resulting from the sale of Company property shall be allocated to the Capital Accounts in accordance with the provisions of Article IV . Any distributions in kind to the Members shall be valued at the fair market value thereof, as reasonably determined by the liquidating trustee, and the Capital Accounts of the Members shall be adjusted to reflect the income or loss that would be allocated to such Members in accordance with the provisions of Article IV in the same manner as if the item(s) of property were sold for an amount equal to the fair market value as so determined.

(b) Upon the liquidation of the Company, all of the assets of the Company shall be applied and distributed by the liquidating trustee in the following order:

(i) to the creditors of the Company, other than Members;

(ii) to setting up reserves which the liquidating trustee may deem necessary for contingent or unforeseen liabilities or obligations of the Company arising out of or in connection with the operations of the Company or its liquidation;

(iii) to the Members with respect to any loans or advances (including accrued and unpaid interest thereon) made by the Members to the Company; and

(iv) to the Members in accordance with their positive Capital Account Balances.

(c) The liquidating trustee shall comply with any requirements of the Act and other applicable Law, except as modified by this Agreement, pertaining to the winding up of a limited liability company formed under the Act, at which time the Company shall stand liquidated.

(d) No Member shall be required to pay to the Company, to any other Member or to any third party any deficit balance which may exist from time to time in the Member’s Capital Account.

8.3 Compliance with the Act . Upon the dissolution of the Company, the liquidating trustee shall cause to be prepared and filed, and the Members shall consent to and execute, where appropriate, such documents as my be necessary or appropriate to comply with the relevant provisions of the Act, including filing a statement of dissolution.

ARTICLE IX

TRANSFERS OF UNITS; PURCHASE AND SALE RIGHTS; REDEMPTION

9.1 Permitted Transfers . Except in compliance with this Article IX , no Member may Transfer any Unit or any portion of a Unit. Any attempted Transfer of a Unit or Units, or any rights appurtenant thereto or portion thereof, other than in compliance with this Article IX shall be void and of no effect. The permitted Transfer (“ Permitted Transfer ”) by a Member shall mean only the following, and only a Person to whom a Permitted Transfer is made pursuant hereto shall be a “ Permitted Transferee ”: (a) a direct or indirect Transfer of Units by a Member to a subsidiary or Affiliate of such Member; (b) a Transfer by a Member holding Class A Units to another Member holding Class A Units (including a Transfer back to ADA from NexGen under the NexGen Purchase Agreement), or a Transfer by a Member holding Class B Units to another Member holding Class B Units; (c) subject to Section 9.3(a) , any Transfer by a Member of Units to any other Person that occurs after December 31, 2012; (d) a Transfer by a Member to any other Person in connection with a change-of-control transaction to which such Member is a party; (e) any Transfer by any Member pursuant to a Drag-Along Sale or a Tag-Along Sale in accordance with this Agreement; or (f) any other direct or indirect Transfer approved by each of the Members; provided, that, the Members will not unreasonably withhold, delay or condition their approval for such a Transfer in the event the Transfer (i) does not change the control of the Units proposed to be Transferred from the Person designated as a Member on the Effective Date (if the Transfer is to an entity owned or Controlled by said Member), (ii) the Transferee of the Transferring Member executes a counterpart of this Agreement, or a joinder to this Agreement in form and substance acceptable to the Board, agreeing to be bound by the terms hereof in addition to any additional restrictions on further Transfers of the Units said new Member has received, and (iii) the proposed Transfer would not constitute a Change of Control of the Company.

9.2 Purchase Right Upon Attempted Transfer . In the event a Member or group of Members (the “ Proposed Transferor ”) attempts to Transfer any Units other than pursuant to a Permitted Transfer (including a Transfer to the separate property of a Person not named as a Member upon a Transfer to a trustee in bankruptcy or a transfer upon the dissolution of a Member to a Person who is not a Member), such Units (the “ Option Units ”) and the Proposed Transferor shall be subject to this Section 9.2 . Notwithstanding anything else in this Section 9.2 , if any Transfer of Units that would otherwise be subject to this Section 9.2 has been approved by the Members as a Change of Control of the Company pursuant to Section 6.1(a)(i) , such Transfer will not be subject to this Section 9.2 .

(a) Company Option to Redeem . The Company shall first have the right to elect to redeem all or a portion of the Option Units (subject to applicable Law or restrictions regarding such redemption) during the period (the “ Company Option Period ”) beginning on the day on which the Company received actual notice in writing of the attempted Transfer (the “ Transfer Notice ”) and ending on the later of (i) forty-five (45) days after the Transfer Notice and (ii) thirty (30) days after receipt of the Appraised Value from the Appraiser (as provided in Section 9.2(d) ). If the Company does not elect to redeem any or all of the Option Units, the

Company shall provide notice of the same to the Members other than the Proposed Transferor (the “ Non-transferring Members ”) no later than five (5) days following the earlier to occur of (x) the Company’s determination that it will not elect to redeem all or any portion of the Option Units and (y) the end of the Company Option Period, and such notice shall specify the number of Options Units not redeemed by the Company.

(b) Member Option to Purchase . In the event the Company elects not to redeem any or all of the Option Units as provided in Section 9.2(a) , the Non-transferring Members shall have the right to elect to purchase all or any portion of that portion of the Option Units not redeemed by the Company during the period (the “ Member Option Period ”) beginning on the earlier to occur of (i) the date on which the Company gives the Non-transferring Members written notice that it does not intend to exercise its option to redeem the Option Units and (ii) the end of the Company Option Period, and ending sixty (60) days thereafter. Notwithstanding anything in this Section 9.2 , a Member that holds no Class A Units prior to an attempted Transfer subject to this Section 9.2 shall not have the option to purchase any Option Units that are Class A Units pursuant to this Section 9.2(b) .

(c) Notice . The option to purchase or redeem provided in this Section 9.2 shall be exercised by the Company and/or the Non-transferring Members, as the case may be, by written notice to the Person who owns or controls the Option Units delivered on or before the end of the Company Option Period or Member Option Period, as applicable. In the event more than one (1) Non-transferring Member desires to purchase Option Units entitled to be purchased by the Non-transferring Members (the “ Purchasing Members ”), if the Purchasing Members cannot agree on the number of Option Units each will purchase, each Purchasing Member shall have the right to purchase the percentage of Option Units to be purchased by all Purchasing Members pro rata based upon their respective Sharing Ratios.

(d) Appraised Value; Appraisers . The value per Option Unit shall be determined by either (i) agreement of the Proposed Transferor and the Company, in the case of Section 9.2(a) , or the Proposed Transferor and the Purchasing Members, in the case of Section 9.2(b) , or (ii) if no agreement can be reached under the applicable portion of Section 9.2(d)(i) , in the case of either Section 9.2(a) or Section 9.2(b) , by an Appraiser determining the Appraised Value. The “ Appraised Value ” shall mean the fair market value of the Option Units, taking into account any lack of liquidity of the Option Units, the financial and business condition of the Company and such other factors an Appraiser may take into account in determining fair market value of the Option Units, excluding any lack-of-control or minority status in determining the value of the Option Units. Any “ Appraiser ” shall be appointed upon approval of the Company, the Purchasing Members and the Proposed Transferor, as applicable, and compensated by such parties and shall be qualified to appraise the Option Units. The Appraiser shall give written notice of the Appraised Value to the Proposed Transferor and the Purchasing Members or the Company, as applicable. The purchase price for each Option Unit shall be as agreed by the appropriate parties, in the case of Section 9.2(d)(i) , or the Appraised Value per Option Unit, in the case of Section 9.2(d)(ii) (the “ Purchase Price ”).

(e) Closing . The closing of the redemption or purchase and sale of the Option Units, whether pursuant to Section 9.2(a) or Section 9.2(b) , shall occur within thirty (30) days

following the determination of the Purchase Price in accordance with Section 9.2(d) . At such closing the Proposed Transferor shall deliver the Option Units to the Company and/or the Purchasing Members, as the case may be, free and clear of any and all Liens (except this Agreement) pursuant to such instrument or instruments as may be necessary or appropriate for such purpose, and the Company and/or the Purchasing Members, as applicable, shall pay to the Proposed Transferor the Purchase Price with respect to the Options Units redeemed or purchased, as applicable, by such Person.

(f) Unredeemed and Unpurchased Option Units . In the event that this Section 9.2 applies to an attempted Transfer and not all of the Option Units subject thereto are elected to be redeemed by the Company pursuant to Section 9.2(a) or purchased by the other Members pursuant to Section 9.2(b) , the Proposed Transferor shall thereafter, without again complying with this Article IX , have the right to Transfer all (but not less than all) of such unredeemed and unpurchased Option Units, on the same terms as in the Proposed Transfer, within sixty (60) days of the end of the Member Option Period, subject to the requirements of Section 9.3 and/or Section 9.4 , if applicable.

9.3 Tag-Along Rights .

(a) Tag-Along Units . In the event (i) Section 9.2 applies to an attempted Transfer and not all of the Option Units subject thereto are elected to be redeemed by the Company pursuant to Section 9.2(a) or purchased by the other Members pursuant to Section 9.2(b) , (ii) all such unredeemed and unpurchased Option Units constitute, in the aggregate, at least fifty (50%) of all Units then held by all Members, and (iii) all Board and Member approvals or consents required by this Agreement in connection with such attempted Transfer have been obtained, all such unredeemed and unpurchased Option Units (the “ Tag-Along Units ”) shall be subject to this Section 9.3 ; provided that, notwithstanding Section 9.1(c) , the Tag-Along Right shall apply to any Transfer of Class A Units that would otherwise be subject to this Section 9.3 regardless of the time of such Transfer. In addition, the provisions of this Section 9.3 shall apply to any Liquidation Event specified in clause (2) of Section 4.5(c)(i) , in which case GS shall be entitled to participate in the Transfer constituting such Liquidation Event on the terms and conditions set forth in this Section 9.3 .

(b) Tag-Along Right . Each Member other than the Proposed Transferor (each, a “ Tag-Along Member ”) may elect to exercise the Tag-Along Right set forth in this Section 9.3 and participate in any attempted Transfer of Tag-Along Units in accordance with this Section 9.3 . As used in this Section 9.3, “ Tag-Along Transferor ” means the Proposed Transferor and “ Tag-Along Sale ” means the attempted Transfer of Tag-Along Units. Each Tag-Along Member shall have a right (a “ Tag-Along Right ”) to sell such Tag-Along Member’s pro rata share of the Tag-Along Units, which pro rata share shall be based on the number of Units then held by such Tag-Along Member as compared to the aggregate number of Units then held by all Tag-Along Members and the Tag-Along Transferor on a fully diluted membership interest basis; provided, that, with respect to the “Tag-Along Right” in connection with a Liquidation Event specified in clause (2) of Section 4.5(c)(i) that occurs prior to January 1, 2013, GS shall have the right to sell a number of Units equal to the total number of Units being Transferred in such Liquidation Event (to the extent GS actually holds such number of Units), and such right will be deemed GS’s Tag-Along Right for purposes of this Section 9.3 .

(c) Notice . In the event a Tag-Along Transferor proposes to make a Tag-Along Sale, the Tag-Along Transferor shall notify each Tag-Along Member (such notice, a “ Sale Notice ”) at least twenty (20) days prior to the date of such Tag-Along Sale. Each Sale Notice shall set forth (i) a description of the Tag-Along Units to be Transferred in such Tag-Along Sale, (ii) the identity of the Transferee in such Tag-Along Sale, and (iii) the proposed amount and form of consideration and the other material terms and conditions of such Tag-Along Sale being offered by the Transferee in such Tag-Along Sale, and, if any portion of the consideration to be paid is other than cash, all material information in the Tag-Along Transferor’s possession regarding such non-cash consideration (collectively, the “ Third Party Terms ”).

(d) Consideration . The Third Party Terms applicable to Class A Units Transferred by the Tag-Along Member pursuant to this Section 9.3 shall be the same as the terms and conditions applicable to any Class A Units Transferred by the Tag-Along Transferor in the Tag-Along Sale, and the Third Party Terms applicable to Class B Units Transferred by the Tag-Along Member pursuant to this Section 9.3 shall be the same as the terms and conditions applicable to any Class B Units Transferred by the Tag-Along Transferor in the Tag-Along Sale; provided, however, the Third Party Terms with respect to any Class A Units Transferred in a Tag-Along Sale may differ from the Third Party Terms with respect to any Class B Units Transferred in such Tag-Along Sale based solely on differences in the fair market value between the Class A Units and the Class B Units. The aggregate purchase price paid for the Class A Units or Class B Units, as applicable, in connection with a Tag-Along Sale will be allocated among Members Transferring Class A Units or Class B Units, as applicable, in such Tag-Along Sale pro rata based on the number of Class A Units or Class B Units, as applicable, being Transferred by a Member as compared to the aggregate number of Class A Units or Class B Units, as applicable, being Transferred by all Members in such Tag-Along Sale. Nothing in this Section 9.3 shall affect the right of GS to receive any Make-Whole Payment to which it becomes entitled pursuant to Section 4.5(c)(i) , and receipt by GS of any such Make-Whole Payment shall in no way affect the amount of proceeds to which GS is entitled pursuant to this Section 9.3(d) . All proceeds received (and any Make-Whole Payment) received by a holder of Class B Units in respect of the Class B Units Transferred by such holder in a Tag-Along Sale shall be treated as a Distribution to such holder of Class B Units for all purposes of this Agreement (including reducing the Unrecovered Investment Balance).

(e) Exercise of Right . A Tag-Along Right may be exercised by a Tag-Along Member by delivery of a written notice to the Tag-Along Transferor (a “ Tag-Along Notice ”) within ten (10) days following receipt of the Sale Notice from the Tag-Along Transferor. The Tag-Along Notice shall state the Class A Units and/or Class B Units held by the Tag-Along Member that such Tag-Along Member proposes to include in such Tag-Along Sale and include an offer to sell such Class A Units and/or Class B Units held by the Tag-Along Member on the terms and conditions specified in the Sale Notice. In the event that one or more Tag-Along Members deliver a Tag-Along Notice within such ten (10) day period following receipt of the Sale Notice, then the Tag-Along Transferor shall be prohibited from selling any of the Tag-Along Units to the proposed Transferee in such Tag-Along Sale unless the Tag-Along Transferor

procures that such Transferee (or its designee) also purchases the applicable Class A Units and/or Class B Units held by the participating Tag-Along Member(s) on the Third Party Terms applicable to such Units. In the event that no Tag-Along Member delivers a Tag-Along Notice within such ten (10) day period following receipt of the Sale Notice, the Tag-Along Transferor shall thereafter, without again complying with this Article IX , have the right to sell all (but not less than all) of the Tag-Along Units to the Transferee within sixty (60) days of the date of the Sale Notice for a purchase price and on other terms and conditions that, on the whole, are no more favorable to the Tag-Along Transferor than the Third Party Terms specified in the Sale Notice.

(f) Closing . At the closing of any Tag-Along Sale, the Transferee in such Tag-Along Sale shall remit to each Tag-Along Member the consideration, not including any Make-Whole Payment to which GS may be entitled in connection with such Tag-Along Sale (which shall be the sole responsibility of the Company), for the Class A Units and/or Class B Units, as applicable, of the Tag-Along Member Transferred in such Tag-Along Sale (less any such consideration to be escrowed or otherwise held back in accordance with the Third Party Terms; provided, however, that such escrow or hold back is pro rata among all Members Transferring Class A Units and/or Class B Units, as applicable, based on the proceeds received by the Member as a result of the Tag-Along Sale as compared to the aggregate proceeds received by all Members as a result of the Tag-Along Sale) in exchange for the delivery by the Tag-Along Member of certificates (if any) or other evidence of ownership representing such Class A Units and/or Class B Units, as applicable, with instruments of transfer as may be reasonably requested by the Transferee in such Tag-Along Sale, and compliance by the Tag-Along Member with any other conditions to closing applicable to the Tag-Along Transferor Transferring Tag-Along Units in such Tag-Along Sale; and provided, further, that the Tag-Along Member shall not be required to bear more than its pro rata share of all liabilities of the Members Transferring Class A Units and/or Class B Units in such Tag-Along Sale (based on the proceeds received by the Member as a result of the Tag-Along Sale as compared to the aggregate proceeds received by all Members as a result of the Tag-Along Sale) for the representations, warranties and other obligations incurred in connection with the Tag-Along Sale (other than with respect to representations and warranties relating to the ownership of the Tag-Along Member’s Units, or otherwise relating solely to the Tag-Along Member). The consideration paid by the Transferee in a Tag-Along Sale to the Tag-Along Member pursuant to this Section 9.3 shall be in the same form and have the same rights as the consideration paid by such Transferee to the Tag-Along Transferor with respect to Units of the same class. All reasonable fees and expenses incurred by the Tag-Along Transferor (including in respect of financial advisors, accountants and counsel to the Tag-Along Transferor) in connection with a Transfer pursuant to this Section 9.3 shall be shared by the Tag-Along Transferor and the Tag-Along Members pro rata in proportion to the consideration received by such Members as a result of the Tag-Along Sale; provided that any Make-Whole Payment received by GS in connection with such Tag-Along Sale shall not be included for purposes of calculating such pro rata share.

(g) *

9.4 Drag-Along Rights .

(a) Approval . After receiving any Board and Member approvals required by this Agreement and complying with Section 9.2 , if any Member or group of Members who hold, in the aggregate, at least fifty percent (50%) of the Units then held by all Members propose to Transfer all but not less than all of their Units to a third party that is not an Affiliate of the Company or any Member (including by way of any consolidation, conversion, merger or other business combination involving the Company in which equity interests in the Company are exchanged for or converted into cash, securities of another Person or other property) (any such Transfer, a “ Drag-Along Sale ”), each of the Members will take all such actions with respect to the Drag-Along Sale as shall be reasonably directed by the Board, including: (i) approving, consenting to and raising no objections to such Drag-Along Sale, (ii) selling such Member’s Units or other securities in the Company in such Drag-Along Sale; (iii) making customary representations, warranties and indemnifications in respect of such Member’s title to any Units or other securities being Transferred, authority to participate in such Drag-Along Sale and other matters customarily addressed in similar transactions by selling Members; and (iv) participating in any escrow arrangements or similar arrangements, provided, in each case, that each Member is treated the same as all other Members similarly situated. *.

(b) Notice . In connection with any Drag-Along Sale, the Member or Members determining to undertake such Drag-Along Sale shall provide the Company and the other Members with a notice stating that such Member or Members have determined to undertake a Drag-Along Sale and summarizing in reasonable detail the material terms upon which the Drag-Along Sale will be made. Such notice shall be delivered at least twenty (20) days before the Member or Members providing such notice enter into any definitive agreement regarding such Drag-Along Sale.

(c) Conditions to Drag-Along Sale . Notwithstanding anything herein to the contrary, the obligations of the Members pursuant to this Section 9.4 are subject to the satisfaction of the following conditions:

(i) All Members shall be entitled (and required) to participate and sell their respective Units or other securities of the Company in such Drag-Along Sale on a ratable basis with all other Members and on the same terms and conditions.

(ii) The Company shall bear the reasonable, documented costs incurred by the Company and the Members in connection with any Drag-Along Sale unless otherwise agreed by the Company and the Transferee in such Drag-Along Sale, in which case no Member shall be obligated to make any out-of-pocket expenditure prior to the consummation of the Drag-Along Sale (excluding reasonable expenditures for postage, copies and the like), and no Member shall be obligated to pay more than its pro rata share (based upon proceeds received in the Drag-Along Sale (the “ Drag-Along Proceeds ”)) of reasonable expenses incurred in connection with such Drag-Along Sale to the extent such costs are incurred for the benefit of all Members and are not otherwise paid by the Company or the Transferee in such Drag-Along Sale, it being understood that costs incurred by or on behalf of a Member for such Member’s sole benefit will not be considered costs of the Drag-Along Sale under this Section 9.4 , and will be paid for solely by such Member incurring such costs.

(iii) Subject to the allocation and distribution of Drag-Along Proceeds in accordance with Article IV , no Member shall be liable for any amount in excess of such Member’s pro rata share of any indemnification obligation (based on Drag-Along Proceeds or, if not sufficient, total proceeds) in excess of any amounts placed in escrow, and all liabilities of each Member in excess of any amounts placed in escrow shall be several liabilities and not joint and several and be capped at the total proceeds actually received by such Member in the Drag-Along Sale.

(iv) The Drag-Along Proceeds (inclusive of escrowed amounts, but excluding amounts that are any portion of the purchase price attributable to the assumption of any obligations or liabilities of the Company by Transferee in the Drag-Along Sale) shall be distributed to the Members in accordance with the relative rights and preferences in respect of Units held by them, as provided in Article IV and 8.2 .

(v) Except for the limited indemnification obligations permitted by this Section 9.4 in the Drag-Along Sale, no Member is subject to any covenants that survive the closing of the Drag-Along Sale.

(vi) All Drag-Along Proceeds and other consideration received by a holder of Class B Units in respect of the Class B Units Transferred by such holder in a Drag-Along Sale (inclusive of escrowed amounts, but excluding amounts that are any portion of the purchase price attributable to the assumption of any obligations or liabilities of the Company by Transferee in the Drag-Along Sale) shall be treated as a Distribution to such holder of Class B Units for all purposes of this Agreement (including reducing the Unrecovered Investment Balance).

(d) Indemnification . Subject to Sections 4.5 and 9.4(c)(iii) , each Member shall be severally obligated to join to the extent of their pro rata share (based on Drag-Along Proceeds and based on the Distribution thereof in accordance with the priorities established under Article IV ) in any indemnification or other obligation the Board has approved in connection with such Drag-Along Sale (other than any such obligations that relate specifically to a particular Member, such as indemnification with respect to representations and warranties given by a Member regarding such Member’s title to and ownership of securities being sold); provided, however, that, any escrow of proceeds of any such transaction shall be withheld on a pro rata basis among all Members (in proportion to the relative Drag-Along Proceeds to be received by each Member); and provided further that such indemnification or other obligation shall be capped at the total proceeds actually received by such Member in the Drag-Along Sale. Each Member shall enter into any indemnification or contribution agreement reasonably requested by the Board to ensure compliance with this Section 9.4(d) .

(e) Impact on Excluded Members . Notwithstanding anything to the contrary in this Section 9.4 , if the consideration proposed to be paid to a Member in a Drag-Along Sale includes securities with respect to which no registration statement covering the issuance of such

securities has been declared effective under the Securities Act, then each Excluded Member participating in the Drag-Along Sale may be required, at the request and election of the Board, to (i) at the cost of Company, appoint a purchaser representative (as such term is defined in Rule 501 under the Securities Act) reasonably acceptable to such Excluded Member or (ii) agree to accept cash in lieu of any securities such Excluded Member would otherwise receive in an amount equal to the fair market value of such securities, as determined by the Board in its reasonable judgment.

9.5 Redemption . On or after the earliest to occur of (i) a breach by the Company of any material provision of the Purchase Agreement or the Organizational Documents that has not been cured within thirty (30) days of the Company’s receipt of written notice thereof, or such longer period during which the Company is diligently working to cure such breach but in no event longer than forty-five (45) days following the Company’s receipt of such written notice, and that results in actual damages or loss of value to the Member(s) holding Class B Units of at least $10,000,000 in the aggregate (without regard to any limitations on the types of damages for which indemnification is available pursuant to the Purchase Agreement), and (ii) the ten (10) year anniversary of the date the last Facility owned by the Company or any Subsidiary is deemed to be placed in service (but in no event later than December 31, 2021), GS may elect, in its sole discretion, by written notice to the Company (a “ Redemption Notice ”) for the Company to redeem all, but not less than all, of the Class B Units then held by GS (a “ Redemption ”). With respect to any Redemption, the Company shall pay to GS in consideration for the Class B Units so redeemed, within one hundred eighty (180) days of the Company’s receipt of the Redemption Notice related to such Redemption, an amount equal to the Unrecovered Investment Balance as of the date of such Redemption. The redemption rights under this Section 9.5 may be transferred only to Permitted Transferees in accordance with Section 9.1 , and, for avoidance of doubt, the redemption rights provided under this Section 9.5 shall terminate and no longer be available to GS on the date that the Unrecovered Investment Balance is reduced to zero (0).

ARTICLE X

INDEMNIFICATION

10.1 Indemnification by Company .

(a) In General . Subject to the limitations and conditions of the Act and this Article X , the Company shall indemnify, defend, save and hold harmless each Person who was or is made a party or is threatened to be made a party to or is involved in, including as a witness or other participant, any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, arbitrative or investigative (hereinafter a “ Proceeding ”), or any appeal in such a Proceeding or any inquiry or investigation that could lead to such a Proceeding, by reason of the fact that such Person, or a Person of whom he, she or it is the legal representative, is or was a Manager, Officer or Member, or a member, manager, partner, shareholder, officer, employee, agent, attorney or Affiliate thereof, or is or was serving at the request of the Company as a manager, officer, partner, venturer, proprietor, trustee, employee, agent or similar position of another foreign or domestic limited liability company, corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise, against judgments, penalties (including excise and similar taxes and punitive damages), losses,

claims, liabilities, fines, damages, settlements and reasonable fees and expenses (including attorneys’ fees) and other amounts (collectively, “ Damages ”) actually incurred by such Person in connection with such Proceeding, and indemnification under this Section 10.1 shall continue as to a Person who has ceased to serve in the capacity which initially entitled such Person to indemnity hereunder. The rights granted pursuant to this Section 10.1 shall be deemed contract rights, and no amendment, modification or repeal of this Section 10.1 shall have the effect of limiting or denying any such rights with respect to actions taken, omissions, or Proceedings arising prior to any such amendment, modification or repeal. It is expressly acknowledged that the indemnification provided in this Section 10.1 could involve indemnification for negligence or strict liability, and except as otherwise specifically provided in this Article X , no Person that has complied with such Person’s obligations under Section 5.7 shall be denied indemnification hereunder for failure to comply with such Person’s duty or care or other duty to the Company or the Members imposed under the Act. Notwithstanding the foregoing, the Company’s indemnification of a Manager as to third party claims shall be only with respect to such Damages that are not otherwise compensated by insurance carried for the benefit of the Company and shall be limited to the net assets of the Company, and no Member shall have any personal liability whatsoever on account thereof.

(b) Advance Payment of Expenses . The right to indemnification conferred in this Section 10.1 shall include the right to be paid or reimbursed by the Company the reasonable expenses incurred by a Person of the type entitled to be indemnified under this Section 10.1(b) who was, is or is threatened to be made a named defendant or respondent in a Proceeding in advance of the final disposition of such Proceeding and without any determination as to the Person’s ultimate entitlement to indemnification pursuant to this Section 10.1 ; provided, however, that the payment of such expenses incurred by any such Person in advance of the final disposition of a Proceeding shall be made only upon delivery to the Company of a written affirmation by such Person of such Person’s good faith belief that such Person has met the standard of conduct necessary for indemnification under this Section 10.1 and a written undertaking, by or on behalf of such Person, to repay all amounts so advanced if it shall ultimately be determined that such indemnified Person is not entitled to be indemnified under this Section 10.1 or otherwise.

(c) Insurance . Subject to the insurance requirement in Section 5.2(e) , the Company may purchase and maintain insurance, at its expense, to protect itself and any Person who is or was serving as a Manager, Officer, employee or agent of the Company or is or was serving at the request of the Company as a manager, officer, partner, venturer, proprietor, trustee, employee, agent or similar position of another foreign or domestic limited liability company, corporation, partnership, joint venture, sole proprietorship, trust, employee benefit plan or other enterprise against any Damages, whether or not the Company would have the power to indemnify such Person against such Damages under this Section 10.1 .

(d) Report to Managers and Members . The Company shall promptly (but in any case within twenty (20) days) notify the Managers and Members of any indemnity payments made pursuant to this Section 10.1 .

(e) Future Amendments to the Act; Invalidation . Notwithstanding anything to the contrary in this Section 10.1 or elsewhere in this Agreement, no amendment to the Act after the date of this Agreement may reduce or limit in any manner the indemnification provided for or permitted by this Section 10.1 unless the reduction or limitation is mandated by the amendment to the Act for limited liability companies formed prior to the enactment of such amendment. If this Section 10.1 or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify and hold harmless the Managers and other Persons entitled to indemnification pursuant to this Section 10.1 to the full extent permitted by any applicable portion of this Section 10.1 that shall not have been invalidated and to the fullest extent permitted by applicable Law.

10.2 Indemnification by the Parties . To the maximum extent permitted by Law, and notwithstanding any other provision relating to the rights of indemnity hereunder, each party hereto shall indemnify and hold harmless (such party, the “ Indemnitor ”) each other party hereto and their respective members, managers, partners, shareholders, officers, employees, agents, attorneys and Affiliates (collectively, the “ Indemnitee ”) from and against any and all Indemnified Losses related to, arising out of or otherwise in connection with any (i) breach or violation of any representation or warranty of the Indemnifying Party contained in this Agreement, (ii) any default by such Indemnifying Party under any agreement or covenant contained herein, and (iii) any violation by such Indemnifying Party of any Law, in all cases except to the extent any such breach, violation or default directly results from the gross negligence or willful misconduct of the party otherwise entitled to be indemnified hereunder.

(a) Mitigation and Related Matters .

(i) The parties agree that in the event of any breach giving rise to an indemnification obligation under this Section 10.2 , the Indemnitee, at the sole cost and expense of the Indemnitor, shall and shall cause its Affiliates to reasonably cooperate with the Indemnitor and to take all reasonable measures, requested by such Indemnitor or otherwise, to mitigate the consequences of the related breach.

(ii) The Indemnitee shall, at the expense of the Indemnitor, use its commercially reasonable efforts to pursue recovery against third parties, under insurance policies or from collateral sources. In the event any amounts recovered from any third party or under such insurance policies or other collateral sources are not received before any claim for indemnification is paid pursuant to this Section 10.2 , then the amount of such subsequent recovery shall be applied first, to reimburse the Indemnitee for its out-of-pocket expenses (including reasonable attorney’s fees and expenses) expended in pursuing such recovery, and second, refund any payments made by the Indemnitor which would not have been so paid had such recovery been obtained prior to such payment, and third, any excess to the Indemnitee.

(iii) The Indemnitor shall be subrogated to the rights of the Indemnitee in respect of any insurance relating to the Damages to the extent of any indemnification payments made hereunder. Any liability for indemnification hereunder shall be determined without duplication of recovery by reason of the state of facts giving rise to such liability constituting a breach of more than one representation, warranty, covenant or agreement.

(b) Notice and Procedures . In the event that any Actions are instituted by a third party or any claim or demand is asserted or threatened against or sought to be collected from an Indemnitee by a third party, in each case for which the Indemnitor may have liability to any Indemnitee under this Section 10.2 (a “ Third Party Claim ”), such Indemnitee shall promptly, but in no event more than fifteen (15) days, following such Indemnitee’s receipt of a Third Party Claim, notify the Indemnitor in writing and in reasonable detail, to the extent available, of such Third Party Claim (a “ Claim Notice ”). The Indemnitor shall have thirty (30) days (or such lesser number of days as may be required by court proceeding in the event of a litigated matter) after receipt of the Claim Notice (the “ Notice Period ”) to notify the Indemnitee that it desires to defend the Indemnitee against such Third Party Claim. The Claim Notice shall (i) state that the Indemnitee has incurred, or reasonably and in good faith expects to incur, Indemnified Losses for which such Indemnitee is entitled to indemnification pursuant to this Agreement; and (ii) specify in reasonable detail, to the extent available, the nature of such Third Party Claim and an estimate of the amount of the applicable Indemnified Losses (if reasonably practicable) to which such Indemnitee reasonably and in good faith believes it may be entitled to hereunder. Thereafter, the Indemnitee shall deliver to the Indemnitor, promptly following the Indemnitee’s receipt thereof, copies of all notices and documents (including court papers and excluding all internally prepared documents or documents prepared by counsel or other representatives of Indemnitee) received by the Indemnitee relating to the Third Party Claim.

(c) Defense of Third Party Claims by Indemnitor . In the event that the Indemnitor notifies the Indemnitee within the Notice Period that it desires to defend the Indemnitee against a Third Party Claim, (i) the Indemnitor shall have the right to defend the Indemnitee by appropriate proceedings and shall have the sole power to direct and control such defense, with counsel of its choosing, at its expense, (ii) the Indemnitor shall use its commercially reasonable efforts to defend diligently such Third Party Claim, (iii) the Indemnitee, prior to the period in which the Indemnitor assumes the defense of such matter, shall take all reasonable actions to preserve any and all rights with respect to such matter, without such actions being construed as a waiver of the Indemnitee’s rights to defense and indemnification pursuant to this Agreement, and (iv) the Indemnitor shall be deemed to have agreed that it shall indemnify the Indemnitee for all Indemnified Losses resulting from such Third Party Claim pursuant to and subject to the conditions of this Section 10.2 . Once the Indemnitor has duly assumed the defense of a Third Party Claim, the Indemnitee shall have the right, but not the obligation, to participate in any such defense and to employ separate counsel of its choosing. The Indemnitee shall participate in any such defense at its expense and shall cooperate in the defense or prosecution of such Third Party Claim; provided , however , that such Indemnitee shall be entitled to participate in any such defense with separate counsel at the reasonable expense of the Indemnitor if, in the reasonable opinion of counsel to the Indemnitee, a conflict or potential conflict exists between the Indemnitee and the Indemnitor that would make such separate representation advisable; and provided , further , that the Indemnitor shall not be required to pay for more than one such counsel for all Indemnitees in connection with any Third Party Claim.

(d) Defense of Third Party Claims by Indemnitee . Notwithstanding anything in Section 10.2(c) to the contrary, if a Third Party Claim seeks relief that would result in the imposition of a consent order, injunction or decree, in any case that would materially restrict the future activity or conduct of the Indemnitee or any of its Affiliates, then the Indemnitee shall be entitled to contest and defend, and subject to Section 10.2(f) , compromise and settle such Third Party Claim in the first instance; provided that if the Indemnitee does not contest, defend, compromise or settle such Third Party Claim, the Indemnitor shall then have the right to contest and defend, and subject to Section 10.2(f) , settle or compromise such Third Party Claim. If the Indemnitee has duly assumed the defense of a Third Party Claim, the Indemnitor shall have the right, but not the obligation, to participate in any such defense and to employ separate counsel of its choosing (at the expense of the Indemnitor). If the Indemnitor (i) does not elect to defend the Indemnitee against a Third Party Claim, whether by not giving the Indemnitee timely notice of its desire to so defend or otherwise or (ii) after assuming the defense of a Third Party Claim, fails to take commercially reasonable steps necessary to defend diligently such Third Party Claim within thirty (30) days (or such lesser number of days as may be required by court proceeding in the event of a litigated matter) after receiving written notice from the Indemnitee to the effect that the Indemnitor has so failed, the Indemnitee shall have the right but not the obligation to assume such defense and shall have the sole power to direct and control such defense, with counsel of its choosing, at the expense of the Indemnitor.

(e) Cooperation . The Indemnitee and the Indemnitor shall cooperate in the conduct of the defense of a Third Party Claim, including by retaining records and information that are reasonably relevant to such Third Party Claim and providing reasonable access to each other’s relevant business records and other documents, and employees. The Indemnitee and the Indemnitor shall use commercially reasonable efforts to avoid production of confidential information (consistent with applicable Law), and to cause all communications among employees, counsel and others representing any party to a Third Party Claim to be made so as to preserve any applicable attorney-client or work-product privileges.

(f) Settlement of Third Party Claims . The Indemnitor shall not, without the prior written consent of the Indemnitee, not to be unreasonably withheld or delayed, settle, compromise or offer to settle or compromise any Third Party Claim. Whether or not the Indemnitor assumes the defense of a Third Party Claim, the Indemnitee shall not, without the prior written consent of the Indemnitor, not to be unreasonably withheld or delayed, settle, compromise or offer to settle or compromise any Third Party Claim.

(g) Direct Claims . In the event any Indemnitee has a claim against any Indemnitor that does not involve, or no longer involves, a Third Party Claim, the Indemnitee shall deliver a notice of such claim (a “ Direct Claim Notice ”) and the amount of the applicable Indemnified Losses or an estimate of the amount of the applicable Indemnified Losses (if reasonably practicable) with reasonable promptness to the Indemnitor. If the Indemnitor notifies the Indemnitee that it does not dispute the claim described in such notice or fails to notify the Indemnitee, within thirty (30) days after delivery of such notice by the Indemnitee whether the Indemnitor disputes the claim described in such notice, the Indemnified Losses in the amount specified in the Indemnitee’s notice will be conclusively deemed a liability of the Indemnitor and the Indemnitee shall be entitled to recover the amount of such Indemnified Losses from the

Indemnitor in accordance with the terms and conditions of this Section 10.2 . If the Indemnitor has timely disputed its liability with respect to such claim, the Indemnitor and the Indemnitee will proceed in good faith to negotiate a resolution of such dispute, and the Indemnitor shall not be obligated to make any payment with respect to such claim until such claim has been so resolved by the Indemnitor and the Indemnitee or has been determined in favor of the Indemnitee by a final judgment, order or decree of an arbitrator or a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected).

ARTICLE XI

MISCELLANEOUS PROVISIONS

11.1 Notices . All notices and other required communications hereunder shall be in writing, addressed as follows:

If to the Company :

Clean Coal Solutions, LLC

8100 SouthPark Drive, Unit B

Littleton, CO 80120

Attn: Mark McKinnies

Fax: (303) 734-0330

Email address: markm@adaes.com

With a copy to, which shall not constitute notice:

Hogan Lovells US LLP

One Tabor Center, Suite 1500

1200 Seventeenth Street

Denver, CO 80202

Attention: Tyler Harvey

Facsimile No.: (303) 454-2436

E-mail address: tyler.harvey@hoganlovells.com

If to NexGen :

NexGen Refined Coal, LLC

3300 South Parker Road, Suite 310

Aurora, CO 80014

Attn: Charles S. McNeil, President

Fax: (303) 751-9210

Email address: cmcneil@nexgen-group.com

With a copy to, which shall not constitute notice:

Republic Financial Corporation

3300 South Parker Road, Suite 500

Aurora, CO 80014

Attn: Legal Department

Fax: (303) 751-4777

Email address: rdietrich@republic-financial.com and lcohen@republic-financial.com

If to ADA :

ADA-ES, Inc.

8100 SouthPark Drive, Unit B

Littleton, CO 80120

Attn: Dr. Michael Durham

Fax: (303) 734-0330

Email address: miked@adaes.com

If to GS:

GSFS Investments I Corp.

200 West Street

New York, New York 10282

Attn: Michael Feldman

Fax: (212) 428-3868

Email address: Michael.Feldman@gs.com

With a copy to, which shall not constitute notice:

Vinson & Elkins L.L.P.

1001 Fannin Street, Suite 2500

Houston, Texas 77002-6760

Attn: F. B Cochran III

Fax: (713) 615-5368

Email address: fcochran@velaw.com

Notices shall be given (a) by personal delivery to the other party, (b) by facsimile or e-mail, with confirmation sent by registered or certified mail, return receipt requested, or (c) by registered or certified mail, return receipt requested. All notices shall be effective and deemed delivered (i) if by personal delivery, on the date of delivery if during business hours, otherwise the next business day, (ii) if by facsimile or e-mail, on the date the facsimile or e-mail is received if received during business hours, otherwise the next business day and (iii) if solely by mail, upon receipt by the addressee, which receipt shall be deemed to have occurred at such time as the party is provided with notice from the postal authorities that a registered or certified letter is awaiting delivery to the party. A party may change its address by notice to the other parties.

11.2 Application of Colorado Law . This Agreement and the application and interpretation hereof shall be governed exclusively by the laws of the State of Colorado, and specifically the Act, without regard to any conflict or law provisions of any jurisdiction.

11.3 No Action for Partition . No Member shall have any right to maintain any action for partition with respect to the property of the Company.

11.4 Amendment of Articles or this Agreement . Except as otherwise expressly set forth in this Agreement, the Articles or this Agreement may be amended, supplemented or restated only upon the unanimous written consent or approval, as the case may be, of the Members; provided, however, that consent or approval of the Class B Members shall not be required for minor clarification changes to the Articles or this Agreement that do not result in any adverse consequences to the Class B Members. Upon obtaining the approval of any amendment to the Articles, the Members shall cause Articles of Amendment in accordance with the Act to be prepared, and such Articles of Amendment shall be executed by a Manager or Member or Members (if so required) and shall be filed in accordance with the Act.

11.5 Binding Effect . Except as herein otherwise provided to the contrary, this Agreement shall be binding upon and inure to the benefit of the Company and the Members, their distributees, legal representatives, executors, administrators, successors and assigns.

11.6 Counterparts . This Agreement may be executed in multiple counterparts, each of which shall be deemed to be an original and shall be binding upon the Company and the Member(s) who executed the same, but all of such counterparts shall constitute the same Agreement.

11.7 Dates . If the date of any required action or notice under this Agreement falls on a Saturday, Sunday or legal holiday, the date of such required action or notice shall be extended to the next business day.

11.8 Confidentiality .

(a) As used herein, the term “ Confidential Information ” means information which is of a non-public, proprietary or confidential nature of the disclosing party or another Person providing information to the Company under an agreement pursuant to which such information is required to be kept confidential (whether such Confidential Information is marked or identified as confidential or has been or is disclosed in circumstances that would lead a reasonable person to believe such information is confidential) disclosed to the receiving Person by the disclosing Person or its officers, directors, agents or representatives, including information disclosed in any conversations and discussions between or among the parties, or any of their officers, directors, agents or representatives (including information disclosed prior to the Effective Date), including all materials, documentation, know-how, potential strategic relationships, reports and analyses, technical and economic data, studies, forecasts, trade secrets, research or business strategies or methods, business structures, monetization strategies, marketing information and strategies, procedures, business, financial or contractual information or other written or oral information regarding ADA, NexGen, GS, the Technology, the Company

or the Business. Confidential Information may be in any form whatsoever, including oral communications, writings, computer programs, logic diagrams, component specifications, drawings, diagrams or other media. All such information, howsoever disclosed, including by inspection or otherwise, shall be deemed Confidential Information unless otherwise expressly agreed in writing by the party or Person disclosing such information.

(b) Notwithstanding the provisions of Section 11.8(a) , the term “ Confidential Information ” shall not include, and no party hereto shall be under any obligation to maintain in confidence or not use, any information (or any portion thereof) disclosed to it by the another party to the extent that such information:

(i) is in the public domain at the time of disclosure; or

(ii) following disclosure, becomes generally known or publicly available through no act or omission on the part of the receiving party; or

(iii) is known, or becomes known, to the receiving party from a source other than the disclosing party or its Representatives, provided that disclosure by such source is not in breach of a confidentiality agreement with the disclosing party; or

(iv) is independently developed by the receiving party without violating any of its obligations under this Agreement and without the use of or reference to any Confidential Information of another party.

(c) If a receiving party is served with any legal process or in any civil action or criminal action is subject to any motion or order requiring the receiving party to disclose to a third-party any Confidential Information of a disclosing party, the receiving party will promptly notify the disclosing party, and unless the disclosing party timely obtains, at its own instigation and cost, an appropriate court order nullifying such process, motion, or order or restraining the receiving party from such disclosure, the receiving party may disclose such Confidential Information as and to the extent required by such legal process, motion, or order. The receiving party will promptly and fully cooperate with all efforts of the disclosing party to obtain such order.

(d) The parties hereby further agree that the Confidential Information (i) may only be used by the receiving party in connection with or in furtherance of the Business, and (ii) will be kept confidential at all times hereunder and not disclosed by the receiving party to any other Person, except that Confidential Information may be disclosed to any of the receiving party’s Affiliates, directors, officers, employees, attorneys, accountants, consultants, advisors or agents, or representatives of any of the foregoing (collectively, its “ Representatives ”), any potential Transferee of Units in accordance with this Agreement and to financing sources and customers who require access to such information in connection with the Business. Each of the parties agrees that any of its Representatives to whom Confidential Information is disclosed will be informed of the confidential or proprietary nature thereof and of the receiving party’s obligations under this Agreement, and that each party shall be responsible for any use or disclosure of Confidential Information by any of its Representatives. Confidential Information

shall not be reproduced in any form except as required to accomplish the intent of this Agreement or in furtherance of the Business. Any reproduction of any Confidential Information shall remain the property of the disclosing party and shall contain all confidential or proprietary notices or legends that appear on the original, unless otherwise authorized in writing by the disclosing party. Notwithstanding the foregoing, Confidential Information incorporated in the ordinary course into any party’s written board materials or minutes shall not be subject to the obligations set forth in this paragraph as long as such materials or minutes are held consistent with the procedures normally used by such party to safeguard proprietary information. Such Confidential Information shall continue to be subject to the other terms and conditions of this Agreement.

(e) The Parties agree that: (i) all rights to Confidential Information disclosed pursuant to this Agreement are reserved to the disclosing party; (ii) except as otherwise prohibited by this Agreement, nothing in this Section 11.8 shall diminish or restrict in any way the rights that each party has to conduct its business or to disclose its own Confidential Information to third parties; and (iii) except as specifically set forth in another Transaction Agreement, no license or conveyance or any rights, including intellectual property rights, relating to the Confidential Information is granted or implied by any party to the another party.

(f) The provisions of this Section 11.8 shall become effective as of the Effective Date, shall survive termination of this Agreement, and shall continue until such Confidential Information ceases to be Confidential Information in accordance with the provisions of Section 11.8(b) , provided, however, that in the event of a dissolution of the Company resulting in the parties ceasing to engage in the Business as members of the Company, the party who owns any such Confidential Information may use such information for any purpose whatsoever.

(g) Upon a disclosing party’s request, the receiving party shall at its option either destroy or return to the disclosing party as promptly as practicable, but in any event within thirty (30) days of such request, all Confidential Information received from the disclosing party in the possession of the receiving party or its Representatives, including all copies of such Confidential Information, all notes or other documents with respect to or reflecting such Confidential Information, and of materials derived from such Confidential Information. Upon completing the foregoing, the receiving party shall give the disclosing party a certificate confirming its compliance with this Section 11.8(g) .

(h) Each party further agrees that all files, records, documents, drawings, specifications, equipment and similar items relating to the Business and which are prepared by the Company in the course of conducting the Business, whether prepared by a Member or others, are and shall remain exclusively the property of the Company and that they shall be removed from the premises of the Company only with the express prior written consent of the Company.

(i) Prior to appointment of any Person who is not also a Member as a Manager or a Board Observer, such Person will be required to execute and deliver to the Company a confidentiality agreement covering essentially the same items as covered hereby.

(j) The receiving party of any Confidential Information acknowledges and agrees that due to the unique nature of the Confidential Information, there may be no adequate remedy at law for any breach of a receiving party’s obligations under this Section 11.8 , that any such breach or any unauthorized use or release of any Confidential Information by a receiving party may allow such receiving party or third parties to unfairly compete with the disclosing party, resulting in irreparable harm to the disclosing party, that upon any such breach or any threat thereof the disclosing party shall be entitled to appropriate equitable relief in addition to whatever remedies that the disclosing party might have at law, and the disclosing party shall be entitled to be indemnified by the receiving party from any loss or harm, including reasonable attorney’s fees, in connection with any breach or enforcement of the receiving party’s obligations under this Section 11.8 or the unauthorized use or release of any such Confidential Information.

(k) Notwithstanding anything else in this Section 11.8 , the parties hereto may disclose to any Person, without limitation of any kind, the United States federal and state income tax treatment and tax structure of the business relationship and transactions contemplated by this Agreement and the other Transaction Agreements, including tax opinions and other tax analysis provided to the parties.

11.9 Covenant Not to Compete; Business Opportunities .

(a) Each Member other than GS agrees that, unless approved in writing by all of the Members, it will not, and it will cause its Affiliates not to, compete, directly or indirectly and for their own account or otherwise, with the Business of the Company while such party is a Member and for a period of three (3) years following the date that such party is no longer a Member. For this purpose, the term “compete” shall mean the ownership, operation, management or control of, or, after the date hereof, acquisition of any financial interest in, any Person, business or enterprise that carries on a business that is substantially the same as the Business carried on by the Company. In addition, during the term of this Agreement, each Member other than GS shall present to the Company for its consideration any business or investment opportunity that is substantially the same as the ongoing Business of the Company (a “ Business Opportunity ”), regardless of whether the Member obtained knowledge of such Business Opportunity in its capacity as a Member and/or Manager or otherwise. If the Company elects not to participate in any such Business Opportunity, the Member shall be entitled to pursue such Business Opportunity free of any rights of the Company therein. The Members agree that prior to the appointment of any Person who is not also a Member as a Manager or Board Observer, such Person will be required to execute and deliver to the Company a non-competition agreement containing terms and conditions substantially the same as this Section 11.9 .

(b) Other than expressly set forth in this Section 11.9 or elsewhere in this Agreement, each Member may, independently or with its Affiliates and others, engage in or have an interest in other business ventures of any kind, and each Member and its Affiliates may make any investment in, or acquire and own all or any part of, any other business or Person, or engage in any transaction outside of the Company, and neither the Company nor any other Member or Affiliate thereof shall have any rights in or to those ventures, and such Member or its Affiliates shall not have any obligation to offer to the Company or any other Member the opportunity to make or participate in that investment or acquisition. Other than Business Opportunities with

respect to the Members other than GS, no Member or any Affiliate thereof shall have any obligation to present or offer any opportunity to the Company prior to such Member’s or Affiliate’s independent pursuit of such opportunity outside of the Company.

11.10 Limitation on Liability . Notwithstanding anything in this Agreement to the contrary or any Law, under no circumstances shall any party be liable to another party for special, consequential, exemplary or punitive damages with respect to any breach of this Agreement, other than the payment of attorneys’ fees as is specifically provided for in this Agreement.

11.11 Invalidity of Provisions . Should any provision or part of any provision of this Agreement be held to be invalid or unenforceable by a court of competent jurisdiction, such provision shall be deemed modified and amended to the extent (but only to the extent) necessary to make such provision valid and enforceable, and so amended, such provision shall be enforced. In the event such a court finds that it cannot so modify or amend any such provision, such provision shall be stricken from this Agreement and the remaining provisions of this Agreement shall remain valid and enforceable to the fullest extent possible, excluding such invalid provision.

11.12 Representations and Warranties .

(a) Each Member represents and warrants, severally and not jointly, to the other Members and the Company as follows:

(i) it is the type of legal entity specified in the first paragraph of this Agreement, duly organized and in good standing under the Laws of the jurisdiction of its organization and is qualified to do business and is in good standing in those jurisdictions where necessary to carry out the purposes of this Agreement;

(ii) the execution, delivery and performance by it of this Agreement and all transactions contemplated herein are within its entity powers and have been duly authorized by all necessary entity actions;

(iii) this Agreement constitutes a valid and binding obligation of such Member, enforceable against it in accordance with its terms, except as enforcement may be limited by Bankruptcy, insolvency, moratorium and similar Laws affecting the enforcement of creditors’ rights generally and by general principles of equity; and

(iv) the execution, delivery and performance by it of this Agreement will not conflict with, result in a breach of or constitute a default under any of the terms, conditions or provisions of (x) any applicable Law, (y) its governing documents, or (z) any agreement or arrangement to which it or any of its Affiliates is a party or which is binding upon it or any of its Affiliates or any of its or their assets.

(b) Each Member recognizes that (i) the Units have not been registered under the Securities Act or qualified under any state securities laws, and covenants not to sell, offer for

sale or otherwise Transfer all or any part of its Units in the absence of an effective registration statement covering such interest under the Securities Act and qualification under applicable state securities laws unless such sale, offer of sale, or other Transfer is exempt therefrom; (ii) the Company has no obligation to register or qualify any Member’s Units for sale or other Transfer, or to assist in establishing an exemption from registration or qualification for any proposed sale or other Transfer and may, in conjunction with any proposed sale or Transfer, require the Transferring owner to provide the Company with an opinion of counsel as to the legality of such sale or other Transfer under applicable Laws; and (iii) the restrictions on Transfer contained in this Agreement, under the Securities Act and under applicable state securities Laws may severely affect the liquidity of a Member’s investment in the Units. This Agreement and any certificates representing Units may include a legend reflecting the restrictions on Transfer set forth in Section 6.8 or elsewhere in this Agreement.

(c) Each Member further represents and warrants, severally and not jointly, to the other Members and the Company as follows:

(i) such Member has been advised (x) that a conflict of interest exists among the Members’ individual interests, (y) that this Agreement has tax consequences, and (z) that it should seek independent counsel in connection with the execution of this Agreement;

(ii) such Member has had the opportunity to seek independent counsel and independent tax advice prior to the execution of this Agreement and no Person has made any representation of any kind to it regarding the tax consequences of this Agreement; and

(iii) this Agreement and the language used in this Agreement are the product of all parties’ efforts, and each party hereby irrevocably waives the benefit of any rule of contract construction that disfavors the drafter of an agreement.

(d) The representations and warranties set forth in Section 11.12(a) , 11.12(b) and 11.12(c) above shall survive the execution and delivery of this Agreement and any documents of Transfer provided under this Agreement.

11.13 Expenses . Except as otherwise specifically provided in this Agreement and the Purchase Agreement, NexGen, ADA and GS will each pay all costs and expenses incurred by each of them on their own behalf in connection with this Agreement and the transactions contemplated hereby, including fees and expenses of their own financial consultants, accountants and counsel.

11.14 Public Announcements . No public announcement may be made by any Person with regard to the transactions contemplated by this Agreement without the prior consent of NexGen, ADA and GS, provided that any party may make such disclosure if advised by counsel that it is required to do so by applicable Law or regulation of any governmental agency or stock exchange upon which securities of such party are registered. NexGen, ADA and GS will discuss any public announcements or disclosures concerning the transactions contemplated by this Agreement with the other parties prior to making such announcements or disclosures.

11.15 Entire Agreement . This Agreement and the other Transaction Agreements, together with all respective exhibits and schedules hereto and thereto, collectively constitute the entire agreement between the parties hereto pertaining to the subject matter hereof and supersedes all representations, warranties, understandings, terms or conditions on such subjects that are not set forth specifically herein or therein, including the terms and conditions contained in the Term Sheet.

11.16 Additional Agreements with GS .

(a) The Company shall keep GS informed, on a current basis, of any events, discussions, notices, or changes with respect to any tax, criminal, or regulatory investigation or action involving the Company or any of its Subsidiaries, and shall reasonably cooperate with GS, its members, and its Affiliates in an effort to avoid or mitigate any cost or regulatory consequences to them that might arise from such investigation or action (including by reviewing written submissions in advance, attending meetings with authorities, and coordinating and providing assistance in meeting with regulators).

(b) Notwithstanding anything to the contrary contained in this Agreement, neither GS nor any of its Affiliates shall be required to *.

(c) The Company and the Members acknowledge and agrees that nothing in the Transaction Agreements shall create a fiduciary duty of GS or its Affiliates (including Goldman, Sachs & Co. and its Affiliates) to the Company or the Members. Notwithstanding anything to the contrary in the Transaction Agreements, or any actions or omissions by representatives of GS or its Affiliates (including Goldman, Sachs & Co. and its Affiliates) in whatever capacity, including as the Board Observer, it is understood that neither GS nor its Affiliates (including Goldman, Sachs & Co. and its Affiliates) is acting as a financial advisor, agent, or underwriter to the Company or any of its Subsidiaries or otherwise on behalf of the Company or any of its Subsidiaries unless retained to provide such services pursuant to a separate written agreement.

(d) The Company and the Members acknowledge that GS is in the business of venture capital investing and therefore reviews the business plans and related proprietary information of many enterprises, including enterprises that may have products or services that compete directly or indirectly with those of the Company or its Subsidiaries. Except for the obligations set forth in Section 11.9(c) , nothing in this Agreement shall preclude or in any way restrict GS from investing or participating in any particular enterprise whether or not such enterprise has products or services that compete with those of the Company or its Subsidiaries.

11.17 Operation and Distributions of Subsidiaries of the Company . The Company, ADA and NexGen hereby agree to operate each Subsidiary of the Company only in accordance with such Subsidiary’s operating agreement and articles of organization and to cause each such Subsidiary to make distributions to the Company, ADA and NexGen only in accordance with the

operating agreement of such Subsidiary. The Company, ADA and NexGen hereby acknowledge that the operating agreement of any Subsidiary of the Company may be amended or modified only in accordance with the terms thereof and only after the written consent of GS in accordance with Section 6.1(b)(viii), if applicable .

[Remainder of Page Intentionally Left Blank]

IN WITNESS WHEREOF, the undersigned have executed this Agreement to be effective as of May , 2011.


COMPANY:

Clean Coal Solutions, LLC

By:		/s/ Charles S. McNeil
Name:		Charles S. McNeil
Title:		Manager

MEMBERS:

ADA-ES, Inc.

By:		/s/ Michael D. Durham
Name:		Michael D. Durham
Title:		President & CEO

NexGen Refined Coal, LLC

By:		NexGen Refined Coal Holdings, LLC, its manager
By:		NexGen Synfuel Management, Inc., its manager

By:		/s/ Thomas A. Ostlund
Name:		Thomas A. Ostlund
Title:		President

GSFS Investments I Corp.

By:		/s/ Albert Dombrowski
Name:		Albert Dombrowski
Title:		Authorized Signatory

S IGNATURE P AGE TO

S ECOND A MENDED AND R ESTATED O PERATING A GREEMENT

INDEX OF EXHIBITS AND SCHEDULES

OPERATING AGREEMENT OF

CLEAN COAL SOLUTIONS, LLC


EXHIBIT		DESCRIPTION

A		Unit Ownership and Sharing Ratios

B		Addresses of Members

C		Chemicals and Additives

D		Technical Engineering Services


SCHEDULE		DESCRIPTION

4.5(a)		Pre-Closing Cash Calculation

4.5(b)		Calculation of Projected Distributable Value

5.1(c)		Managers

6.11(a)		Arrangements with Affiliates

EXHIBIT A

OPERATING AGREEMENT

Clean Coal Solutions, LLC

Unit Ownership and Sharing Ratios


Member	Class A Units*	Class B Units**	Sharing Ratios
ADA-ES Inc.	42 2/19	0		42 2/19	%
NexGen Refined Coal, LLC	42 2/19	0		42 2/19	%
GSFS Investments I Corp.	0	15 15/19		15 15/19	%

*	All Voting Units

**	All Non-voting Units

EXHIBIT B

OPERATING AGREEMENT

Clean Coal Solutions, LLC

Addresses


Member		Address
ADA-ES, Inc.		8100 SouthPark Way, Unit B Littleton, CO 80120

NexGen Refined Coal, LLC		3300 South Parker Road, Suite 310 Aurora, CO 80014

GSFS Investments I Corp.		200 West Street New York, New York 10282

EXHIBIT C

OPERATING AGREEMENT

Clean Coal Solutions, LLC

Chemicals and Additives

•

Mercury control halogen additive required in connection with the Chemicals Business

•

Iron mineralizer additive

•

Other chemicals or additives that may be required for coal treatment in connection with the Chemicals Business

EXHIBIT D

OPERATING AGREEMENT

Clean Coal Solutions, LLC

Technical Engineering Services

Scope of Work :

ADA will provide the Technical Engineering Services specified by the Company from time to time on a properly tendered and accepted order document, consisting of a purchase order (or similar document) in form acceptable to ADA, which has been completed to specify with particularity at least the following (i) the Chemicals and Additives, equipment and/or Technical Engineering Services requested, (ii) the quantities required, (iii) the time and place for delivery, (iv) the prices to be paid therefor, and (v) any insurance and/or delivery arrangements requested to be provided by ADA.

Prices for Technical Engineering Services :

Technical Engineering Services will be charged to the Company at ADA’s published commercial rates, which as of May 24, 2011, are as follows:

(Effective as of May 24, 2011, subject to change on prior notice)


Category	Rate ($/hour)
Executive Management	$	250
Principal	$	170
Project Manager	$	145
Senior Engineer	$	135
Engineer	$	110
Technician	$	85
Administrative Support	$	70

Materials Fee: 10% mark-up on all direct materials aside from Chemicals and Additives specified above, subcontracts, consultants, leases, and other direct costs.

SCHEDULE 4.5(a)

Pre-Closing Cash Calculation

SCHEDULE 4.5(b)

Calculation of Projected Distributable Value

SCHEDULE 5.1(c)

Managers

ADA Managers: Dr. Michael Durham, Dr. Nina Bergan French, Mark McKinnies

NexGen Managers: Charles S. McNeil, Brian C. Humphrey, W. Randall Dietrich

SCHEDULE 6.11(a)

Arrangements with Affiliates

Employees and contractors of ADA (collectively, “ ADA Personnel ”) and employees and contractors of the ultimate owners of NexGen (collectively, “ NexGen Personnel ”) have provided certain services to the Company on an ongoing basis since the Company’s inception. These services are billed to the Company on terms comparable to those that would be expected to be obtained by the Company for similar services in an arms’ length transaction with a non-Affiliate of the Company.

The services provided by ADA Personnel to the Company include current and future services for refined coal production equipment design, construction, installation and testing, ongoing research and development in respect of improvements to the CyClean technology, and services related to the “redetermination” process for the refined coal production facilities as required by the Code and the written guidance issued by the IRS in respect of Section 45 refined coal thereunder. The time spent by ADA Personnel on these services has been, and will continue to be, billed to the Company on a monthly basis, based upon the rate sheet set forth below. The services provided by NexGen Personnel to the Company include current and future services for legal, insurance, accounting, human resources, book-keeping, tax, finance, administrative and related matters. The time spent by NexGen Personnel on these services has been, and will continue to be, billed to the Company on a monthly basis, based upon the rate sheet set forth in the immediately following page:

NexGen Personnel


Name	Duties Services	Hourly Rate
*	Legal support, services and counsel	$	*
*	Legal support, services and counsel	$	*
*	Legal support, services and counsel	$	*
*	Tax reporting, services and support	$	*
*	Risk management reporting, implementation, support and related services	$	*
*	Accounting reporting, support, and related services	$	*
*	Legal services and support	$	*
*	Risk management reporting, implementation, support and related services	$	*
*	Human resources support and services	$	*
or comparable personnel or replacement of such person

ADA Personnel


Position	Hourly Rate
Executive Management	$	*
Principal	$	*
Project Manager	$	*
Senior Engineer	$	*
Engineer II	$	*
Engineer I	$	*
Technician II	$	*
Technician I	$	*
Administrative Assistant II	$	*
Administrative Assistant I	$	*

In addition to the foregoing, the Company has engaged Clean Coal Solutions Services, LLC (“ CCSS ”) to assist it in the installation and testing of new refined coal production facilities. These services are billed to the Company on terms comparable to those that would be expected to be obtained by the Company for similar services in an arms’ length transaction. As of the Effective Date, the Company has issued five (5) purchase orders to CCSS for services related to

the installation and testing of the first five anticipated refined coal production facilities. Copies of these purchase orders are included in Section 4.21 of the disclosure schedules to the Purchase Agreement and are incorporated herein by this reference. The Company expects to engage CCSS personnel to assist it in a similar capacity for any additional refined coal production facilities on substantially similar terms.

Aaron Prince, Matt Holley, and Janet McGinty are employees of ADA and have been seconded to the Company. Under the terms of their respective employment agreements with ADA, Mr. Prince receives an annual salary of $*, Mr. Holley receives an annual salary of $*, and Ms. McGinty receives an annual salary of $*. The Company reimburses ADA monthly for the costs of these salaries, plus a labor burden of *% and an overhead burden of *% on the salary and labor burden costs. The Company expects to continue this arrangement until such time as it determines, in good faith, that the services of any one or all of these individuals are no longer needed by the Company. The Company may enter into similar arrangements with ADA employees as determined by the Company, in good faith, as may be necessary to further the business interests of the Company.

Mike Allen is an employee of ADA and has been seconded to the Company. ADA bills the Company for the time Mr. Allen spends on engineering projects for the Company at the rate of $* per hour. The Company expects to continue this arrangement until such time as it determines, in good faith, that the services of this individual are no longer needed by the Company.

On May 31, 2001, it is expected that James Weed will begin working for ADA as an employee and will be seconded to the Company as a project manager. ADA will bill the Company for the time Mr. Weed will be spending as a project manager for the Company at the rate of $* per hour. The Company would expect to continue this arrangement until such time as it determines, in good faith, that the services of this individual are no longer needed by the Company.

Dr. Nina Bergan French is an independent contractor to ADA. Under the terms of her independent contractor agreement with ADA, ADA pays Dr. French $* per month. ADA then bills this amount to the Company each month as reimbursement for Dr. French’s services. Given the important role Dr. French currently plays, and is expected to continue to play, in the Company in connection with the ongoing efforts to implement CyClean in utility power plants, the Company expects to continue this arrangement with Dr. French, or may alternatively hire Dr. French as an employee of the Company. The Company also reimburses Dr. French for the cost of an administrative assistant in the amount of $* per month.

NexGen bills the Company * per month for corporate management services performed by employees of the ultimate owners of NexGen. The Company would expect to continue this arrangement until such time as it determines, in good faith, that the services of this personnel is no longer needed by the Company.

Exhibit 10.84

EXECUTION VERSION

EXCLUSIVE RIGHT TO LEASE AGREEMENT

between

GSFS INVESTMENTS I CORP

and

CLEAN COAL SOLUTIONS, LLC

dated

May 27, 2011

*	Indicates portions of the exhibit that have been omitted pursuant to a request for confidential treatment. The non-public information has been separately filed with the Securities and Exchange Commission.

TABLE OF CONTENTS


Section 1	DEFINITIONS	3
Section 2	GRANT OF EXCLUSIVE RIGHT	3
Section 3	EXCLUSIVITY	4
Section 4	CONSIDERATION	4
Section 5	TERM	4
Section 6	CERTIFICATION PROCESS	4
Section 7	DEPOSIT.	5
Section 8	LEASE AND OTHER DOCUMENTS.	7
Section 9	CLOSING.	7
Section 10	REPRESENTATIONS AND WARRANTIES.	8
Section 11	CONFIDENTIALITY.	9
Section 12	AMENDMENT, MODIFICATION AND WAIVER	10
Section 13	SEVERABILITY	10
Section 14	EXPENSES AND OBLIGATIONS	10
Section 15	LIMITATION ON LIABILITY	10
Section 16	BINDING EFFECT; THIRD PARTIES	11
Section 17	NOTICES	11
Section 18	COUNTERPARTS	12
Section 19	ENTIRE AGREEMENT	12
Section 20	GOVERNING LAW	12
Section 21	PUBLICITY	12
Section 22	FURTHER ACTS	13
Section 23	EXHIBITS	13
Section 24	SURVIVAL	13
Section 25	ASSIGNMENT; THIRD PARTIES	13
Section 26	MISCELLANEOUS.	13

EXCLUSIVE RIGHT TO LEASE AGREEMENT

This Exclusive Right to Lease Agreement (“ Agreement ”) is made effective as of May 27, 2011 (“ Effective Date ”) by and between GSFS Investments I Corp., a Delaware corporation (“ GS ”), and Clean Coal Solutions, LLC, a Colorado limited liability company (“ Owner ”).

RECITALS:

WHEREAS, Owner is the licensee of certain technology that is utilized for the purposes of producing Refined Coal from coal;

WHEREAS, Owner is in the business of building and operating refined coal facilities in order to produce Refined Coal for sale to Utilities for use in coal fired power generation plants;

WHEREAS, the parties hereto, or Affiliates thereof, have previously entered into arrangements pursuant to which GS RC leases from Affiliates of Owner two refined coal facilities and Owner’s Affiliate operates on behalf of GS RC certain aspects of such facilities on a day-to-day basis;

WHEREAS, contemporaneously with the execution of this Agreement, the parties hereto have executed the Purchase Agreement pursuant to which GS purchased certain interests in Owner;

WHEREAS, GS desires to obtain an exclusive right to lease from Owner certain refined coal facilities for the purpose producing Refined Coal for sale to Utilities; and

WHEREAS, Owner has agreed to grant such exclusive right to lease to GS under the terms and conditions of this Agreement.

NOW, THEREFORE, for and in consideration of the Right Consideration and the mutual promises set forth in this Agreement, the receipt and sufficiency of which are hereby acknowledged, the parties hereto do hereby agree as follows:

Section 1 DEFINITIONS . Capitalized terms used in this Agreement but not defined in the body of this Agreement have the meanings ascribed to them in Exhibit A . Capitalized terms defined in the body of this Agreement are listed in Exhibit A with reference to the location of the definition of such term in this Agreement.

Section 2 GRANT OF EXCLUSIVE RIGHT . Owner hereby grants to GS, for the benefit of GS and its Affiliates, an exclusive right, but not the obligation (the “ Right ”), during the Term, to lease from Owner (or an Affiliate of Owner) certain Facilities under the terms and conditions set forth in this Agreement. If the Right is exercised, the Parties (or Affiliates thereof) will enter into the Lease Documents pursuant to Section 8(a). Subject to Waiver of such Right pursuant to Section 7, GS may exercise the Right at any time prior to the expiration of the Term on the terms set forth in this Agreement. In addition, GS may terminate the Right at any time prior to exercise of the Right or expiration of the Term by giving written notice to Owner of such termination. GS may designate from time to time any Affiliate and may grant the Right to such Affiliate, together with the right to enter into any transactions contemplated herein.

Section 3 EXCLUSIVITY . Neither Owner nor any of its Affiliates shall, through and including the Term: (i) initiate contact with, solicit, encourage or respond to any inquiries, discussions or proposals by, (ii) enter into any agreements or understandings with, (iii) continue, propose or enter into any discussions or negotiations with, (iv) disclose, directly or indirectly, any information to, or (v) afford any access to, any Person in connection with any transaction or potential transaction regarding any Facility unless and until GS, in its sole discretion, waives or is deemed to have waived the Right with respect to such Facility pursuant to Section 7(b) or otherwise waives the Right in writing with respect to such Facility.

Section 4 CONSIDERATION . In partial consideration of the grant of the Right herein, the Parties (or Affiliates thereof): (i) entered into an Amendment to Agreement to Lease, dated May 11, 2011, pursuant to which a right of first refusal granted to GS RC to participate in certain transactions similar to those that are the subject of this Agreement was terminated; and (ii) consummated the transactions set forth in, and any transactions contemplated by, the Purchase Agreement (collectively, the “ Right Consideration ”).

Section 5 TERM . Owner shall, pursuant to the obligations and procedures set forth in Sections 6 and 7, lease to GS Facilities having a total throughput capacity of at least 12,000,000 Tons of Refined Coal per year, based upon each Utility’s stated anticipated use of Refined Coal to be produced by the Facility during the twelve month period immediately following the Closing related to such Facility (excluding those facilities the subject of the AEC Project Agreements), plus or minus ten per cent (10%) (the “ Target Tons ”). The term of the Right (as the same may from time to time be extended by the mutual agreement of the parties, the “Term”) will be from the Effective Date until the first date on which Owner has leased to GS Facilities representing the Target Tons pursuant to this Agreement.

Section 6 CERTIFICATION PROCESS . Owner anticipates offering to GS the Right to lease the Facilities that Owner intends to place at the sites listed on Exhibit C (which such list is provided for illustrative purposes only) together with any such other Facilities as may be required to be leased to GS in connection with the leasing to GS of the Target Tons. The parties shall comply with the following procedures and principles when considering the siting, testing, certification and placing into service of any Facility:

(a) Owner shall provide to GS, within thirty (30) days of the Effective Date, or if not then available as soon as practicable thereafter, to the extent such items are in Owner’s possession or control or otherwise available to Owner:

(i) in addition to the list set forth on Exhibit C , a list of any potential sites for each Facility;

(ii) copies of any construction, balance of plant, site use, demonstration, service or other material contracts affecting each Facility;

(iii) copies of any permits and licenses affecting each Facility or (to the extent available to Owner) the proposed site of any such Facility, including all occupancy or operating permits, permits to conduct business and permits and permit applications under Environmental Laws;

(iv) copies of any environmental site assessments and reports including groundwater, surface water, and soil sampling information in connection with any potential Facility site as well as any site investigation or remediation orders or information requests issued pursuant to any Environmental Law or with respect to the possible presence of toxic or hazardous substances on any such site;

(v) such other documents and information as are related to the foregoing as GS may reasonably request from time to time;

(b) GS shall be entitled to undertake due diligence with respect to any Facility, the potential site on which any such Facility may be placed and any Utility as GS, in its sole discretion, deems appropriate, and Owner agrees to comply with any reasonable request of GS associated therewith, and to assist GS in undertaking such diligence;

(c) subject to the accompaniment by a Representative of Owner, Owner shall permit, and shall use reasonable commercial efforts to cause each applicable Utility to permit, GS and GS’s employees, agents, contractors and consultants at any time during the Term, on the giving of reasonable prior notice, to enter upon any site or any potential site on which a Facility may be placed to make any inspections or conduct such tests on any Facility as GS may reasonably desire, so long as such inspections and tests do not damage the Facility, impair its operations, or otherwise interfere with the operations of the plant;

(d) Owner shall provide (i) written notice of any change in the date testing is expected to commence with respect to any Facility listed on Exhibit C (listed in the “Expected Demonstration Commencement Date” column) as soon as practicable, but in no event more than five (5) days, following Owner’s determination to make such change and (ii) fifteen (15) days written notice of its intent to commence testing on any other Facility placed at any site;

(e) upon commencement of testing on any Facility listed on Exhibit C or any other Facility which GS may have the Right to lease pursuant to this Agreement, GS’s employees, agents, contractors and consultants shall be entitled to observe such tests and to undertake any additional diligence with respect to such testing as GS in its sole discretion elects;

(f) any testing performed by or on behalf of Owner on any Facility shall be consistent with best industry practice and, to the extent relevant, in accordance with Section 45 of the Code and the IRS Guidance; and

(g) Owner shall provide to GS a written certification, in substantially the form of Exhibit D (the “ Certification ”), with respect to each Facility that GS has the Right to lease, within ten (10) days of the completion of all testing, once Owner believes that the Facility has passed all necessary tests and has been placed in service within the meaning of Section 45(d)(8) of the Code.

Section 7 DEPOSIT .

(a) For each Facility the subject of a Certification, within five (5) business days following the date of the delivery of the Certification to GS, if GS accepts such

Certification, GS will pay Owner a deposit in an amount equal to $* for each 1,000,000 Tons of projected annual Refined Coal production from each Facility (the “ Deposit ”). For the purposes of the calculation of the Deposit, the projected annual Refined Coal production shall be based upon the relevant Utility’s stated anticipated annual use of Refined Coal produced by the Facility for electricity generation (the “ Facility Tons ”). The acceptance of any Certification and the payment of any Deposit is not a binding obligation on GS to execute the Lease Documents or any Utility Agreements.

(b) If GS does not accept any Certification, it shall notify Owner of the same in writing within * of the delivery of the Certification. With respect to any Certification for which GS does not provide written notice to Owner within the * period specified in the immediately preceding sentence, Owner shall re-send such Certification to GS and GS shall have a further * period in which to accept or reject such Certification. If GS accepts such Certification (whether within the initial or the subsequent * period), it shall pay the Deposit in accordance with Section 7(a). GS agrees to respond to Owner by the end of the * periods referred to above, but if GS does not accept any Certification within the aforementioned time periods, or if GS notifies Owner in writing that it does not accept any Certification pursuant to the first sentence of this paragraph, the Right, solely with respect to the Facility at the site that is the subject of the Certification, shall be waived * (a “ Waiver ”).

(c) GS acknowledges and agrees that, following a Waiver with respect to any Facility, GS will have no further rights with respect to such Facility or the Tons of Refined Coal produced by such Facility, and Owner shall be entitled to offer the Right with respect to such Facility to any other Person, without restriction, as Owner deems necessary or desirable.

(d) *

(e) In addition to the circumstances identified in Section 8(d), the Deposit will be promptly refunded to GS at any time after * of the date of the payment of the Deposit if Closing with respect to such Facility has not occurred and GS notifies Owner that it requests a return of the Deposit. If a Deposit is refunded pursuant to Section 7(c), GS will be deemed to have made a Waiver with respect to the Facility to which the refunded Deposit relates, and such Facility will be subject to the provisions of Section 7(c).

(f) In the event Owner becomes obligated to refund a Deposit pursuant to this Agreement, any such refund shall be made within thirty (30) days of the end of the calendar quarter in which the request for such refund is made; provided, however, that from the date that GS notifies Owner that it wishes the Deposit to be refunded, interest on the Deposit (which shall be payable in full on the return of the Deposit) shall accrue at a rate equal to * per annum, compounded semi-annually, but in no event shall such interest exceed the maximum rate permitted by Law.

(g) Any Right Waived pursuant to this Agreement shall be waived only in respect of the applicable Facility at the site that is the subject of the Certification and shall in no way waive or impact GS’ Right to lease Facilities equal to the Target Tons.

Section 8 LEASE AND OTHER DOCUMENTS .

(a) With respect to the exercise of the Right relating to any Facility, the following agreements are referred to herein as the “ Lease Documents ”: (i) an equipment lease and an agreement to lease (in each case with Owner or an Affiliate of Owner as lessor and GS or an Affiliate of GS as lessee); (ii) an operating and maintenance agreement with respect to each leased Facility (with Owner or an Affiliate of Owner as operator and GS or an Affiliate of GS as lessee); (iii) a technology sub-license (with Owner or an Affiliate of Owner as sublicensor, GS or an Affiliate of GS as sublicensee and ADA as licensor); and (iv) guarantees from each of ADA, NexGen Refined Coal, LLC, NexGen Investments LLLP and Republic Financial Corporation, each the same in substance and form as those in the AEC Project Agreements (provided that, with respect to the guarantees given by NexGen Investments LLLP and Republic Financial Corporation, the Guaranty Cap (as defined in the AEC Project Agreements) shall apply in aggregate to the AEC Project Agreements and each new monetization transaction the subject of the Lease Documents). Once a Deposit has been paid in connection with a Facility, GS shall prepare Lease Documents based on the business terms and conditions set forth in Exhibit B and, to the extent not covered by Exhibit B , the terms set forth in the AEC Project Agreements, together with such modifications as may be appropriate to take into account differences in the location, size and nature of any Facility. GS shall provide drafts of the Lease Documents to Owner within fifteen (15) days of the payment of the Deposit.

(b) The execution of the Lease Documents is subject to GS (or its applicable Affiliate) agreeing with the applicable Utility and coal supplier to certain agreements in connection with the purchase of coal, the sale of Refined Coal, coal handling and site license/lease arrangements in respect of such Facility (the “ Utility Agreements ”).

(c) Simultaneously with the execution of the Utility Agreements, the parties (or Affiliates thereof) shall enter into the Lease Documents and the closing of any such transaction (the “ Closing ”) shall take place in accordance with Section 9.

(d) In the event that GS has reached agreement with the applicable Utility with respect to the Utility Agreements, and both GS and the applicable Utility have a binding commitment (or have agreed on the forms of agreements such that they are ready) to execute and deliver the Utility Agreements, and Owner fails to execute the Lease Documents, such failure shall amount to a breach by Owner of this Agreement, Owner shall promptly refund the Deposit and GS shall be entitled to all remedies available at law or equity, including specific performance.

Section 9 CLOSING .

9.1 At any Closing, GS will deliver, or cause its applicable Affiliate to deliver, to Owner:

(a) An original of each of the Lease Documents, duly executed by GS (or its applicable Affiliate), and with all signatures acknowledged;

(b) Any other deliverables consistent with those provided by the lessees under the AEC Project Agreements; and

(c) By wire transfer of immediately available funds to the account designated by Owner on or before the third day prior to Closing, an amount equal to the Facility Tons times $*, less the amount of any Deposit previously paid by GS with respect to the Facility included in the Closing.

9.2 At any Closing, Owner will deliver, or cause its applicable Affiliate to deliver, to GS:

(a) An original of each of the Lease Documents, duly executed by Owner (or its applicable Affiliate), and with all signatures acknowledged; and

(b) Any other deliverables consistent with those provided by the lessors under the AEC Project Agreements.

Section 10 REPRESENTATIONS AND WARRANTIES .

10.1 Each party hereto hereby represents and warrants to the other party that, as of the date of this Agreement:

(a) Such party is duly formed, validly existing and in good standing under the laws of the state of its formation, and has all requisite corporate or similar power and authority to own, lease and operate its properties and to carry on its business as being conducted on the date hereof. Such party is qualified to do business and is in good standing under the laws of the jurisdictions in which the character of the properties owned or leased by such party or the nature of the activities conducted by such party in operating its business make such qualification necessary under applicable Laws;

(b) Such party has all requisite corporate or similar power and authority to enter into the Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated hereby. The execution and delivery by such party of this Agreement, the performance by it of its obligations hereunder and the consummation by it of the transactions contemplated hereby, have been duly authorized by all necessary action on the part of such party. Upon the execution and delivery by such party of this Agreement, the Agreement will be duly executed and delivered by such party. This Agreement constitutes a valid and binding obligation of such party, enforceable against such party in accordance with its terms, subject as to enforceability to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting enforcement of creditors’ rights and remedies generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity);

(c) The execution and delivery by such party of this Agreement do not, and the performance by it of its obligations hereunder will not (i) violate, conflict with, or result in any breach of any provision of its organizational documents, (ii) violate, conflict with, or result in a violation or breach of, or constitute a default (with or without due notice or lapse of

time or both) under, or permit the termination of, or result in the acceleration of, or entitle any Person to accelerate any obligation, or result in the loss of any benefit, or give any Person the right to require any security to be repurchased or (iii) violate any applicable Law;

(d) There are no proceedings pending or, to the knowledge of such party, threatened against such party or relating to such party’s execution, delivery or performance of Agreement. Such party has not received any written claim or notification that may give rise to or notice of any such proceedings which could reasonably be expected to have a material adverse effect on such party or the transactions contemplated by this Agreement. Such party has no knowledge that there is a valid basis for any such claims or proceedings. Such party is not, to such party’s knowledge, the subject of any order, judgment, decree, injunction or stipulation of any Governmental Authority that would affect its ability to consummate the transactions contemplated by this Agreement; and

(e) No agent, broker, investment banker, or other Person engaged by such party is or will be entitled to any broker’s or finder’s fee or any other commission or similar fee payable by the other party in connection with any of the transactions contemplated by this Agreement.

Section 11 CONFIDENTIALITY .

11.1 Each party hereto shall maintain the terms of this Agreement in confidence and shall not disclose any information concerning the terms, performance or administration of this Agreement to any other Person; provided that a party may disclose such information: (i) to any of such party’s Group, (ii) to any prospective member of such party’s Group, (iii) to any actual or prospective purchaser of all or a portion of such party’s interest in a Facility, and (iv) to any Person providing or evaluating a proposal to provide financing to the recipient party or any direct or indirect owner of such party; provided in each case that the recipient party shall provide to each Person to which disclosure is made a copy of this Section 11 and direct such Person to treat such information confidentially, and the recipient party shall be liable for any breach of the terms of this Section 11 by such Persons to which it makes any such disclosure. The foregoing restrictions will not apply (A) to information that is or becomes generally available to the public otherwise than as a result of disclosure by the recipient party, (B) to information that is already in, or subsequently comes into, the recipient party’s possession, provided that the source of such information was not, to the recipient party’s knowledge, obligated to keep such information confidential, (C) to information that is required to be disclosed pursuant to Law or stock exchange rules and regulations or is otherwise subject to legal, judicial, regulatory or self-regulatory requests for information or documents or (D) subject to Section 11.2 below, to the tax structure or tax treatment of the transaction.

11.2 Each party may disclose to any and all Persons, without limitation of any kind, the tax treatment and tax structure of the transaction, provided, however, that any such information is required to be kept confidential to the extent necessary to comply with any applicable securities Laws. The tax structure and tax treatment of the transaction includes only those facts that may be relevant to understanding the purported or claimed U.S. federal and state income tax treatment or tax structure of the transaction and, to eliminate any doubt, therefore specifically does not include information that either reveals or standing alone or in the aggregate

with other information so disclosed tends of itself to reveal or allow the recipient of the information to ascertain the identity of any parties involved in any of the transactions contemplated by this Agreement or the documents to be delivered in connection herewith.

11.3 If any party is required to disclose any information required by this Section 11 to be maintained as confidential in a judicial, administrative or governmental proceeding, such party shall give the other party at least ten (10) days’ prior written notice (unless less time is permitted by the applicable proceeding) before disclosing any such information in any said proceeding and, in making such disclosure, the party required to disclose the information shall disclose only that portion thereof required to be disclosed and shall cooperate with the other party in the other party’s attempts to seek to preserve the confidentiality thereof, including if such party seeks to obtain protective orders and/or any intervention.

11.4 The parties hereto agree that irreparable damage would occur in the event that this Section 11 was breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Section 11 and to enforce specifically the terms and provisions of this Section 11.

Section 12 AMENDMENT, MODIFICATION AND WAIVER . This Agreement may not be amended or modified except by an instrument in writing signed by each of the parties hereto. Any failure of any party to comply with any obligation, covenant, agreement, or condition contained herein may be waived only if set forth in an instrument in writing signed by the party or parties to be bound thereby, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any other failure.

Section 13 SEVERABILITY . If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any rule of applicable Law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated herein are not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated herein are consummated as originally contemplated to the fullest extent possible.

Section 14 EXPENSES AND OBLIGATIONS . Except as otherwise expressly provided in this Agreement, all costs and expenses incurred by the parties in connection with this Agreement and the consummation of the transactions contemplated hereby shall be borne solely and entirely by the party which has incurred such expenses.

Section 15 LIMITATION ON LIABILITY . IN NO EVENT SHALL EITHER PARTY OR SUCH PARTY’S AFFILIATES, MEMBERS, MANAGERS, OFFICERS, EMPLOYEES OR AGENTS BE LIABLE BY REASON OF THIS AGREEMENT FOR ANY INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY OR CONSEQUENTIAL DAMAGES OR LOSS OF PROFITS, REVENUE OR GOODWILL, WHETHER IN AN ACTION IN CONTRACT, TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHER LEGAL THEORY, EVEN IF THE PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

Section 16 BINDING EFFECT; THIRD PARTIES . This Agreement shall be binding upon and, except as provided below, inure solely to the benefit of each party and its successors and permitted assigns, and nothing in this Agreement, express or implied, is intended to confer upon any other Person any rights or remedies of any nature whatsoever under or by reason of this Agreement.

Section 17 NOTICES . All notices and other communications hereunder shall be in writing and shall be deemed given if delivered personally, by a nationally recognized overnight courier, by facsimile or electronic mail, or mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to GS, to:

GSFS Investments I Corp.

c/o Goldman Sachs & Co.

200 West Street

New York, New York 10282

Attention: Michael Feldman

Fax: (212) 428-3868

Email address: mfeldman@gs.com

With a copy (which shall not constitute notice) to:

Vinson & Elkins L.L.P.

1001 Fannin Street, Suite 2500

Houston, Texas 77002-6760

Attention: F. B Cochran III

Fax: (713) 615-5368

Email address: fcochran@velaw.com

If to the Owner, to:

Clean Coal Solutions, LLC

8100 SouthPark Drive, Unit B

Littleton, CO 80120

Attn: Mark McKinnies

Fax: (303) 734-0330

Email address: markm@adaes.com

With copies (which shall not constitute notice) to:

NexGen Refined Coal, LLC

3300 South Parker Road, Suite 310

Aurora, CO 80014

Attn: Charles S. McNeil, President

Fax: (303) 751-9210

Email address: cmcneil@nexgen-group.com

and

Hogan Lovells US LLP

One Tabor Center, Suite 1500

1200 Seventeenth Street

Denver, CO 80202

Attention: Tyler Harvey

Facsimile No.: (303) 454-2436

E-mail address: tyler.harvey@hoganlovells.com

Section 18 COUNTERPARTS . This Agreement may be executed and delivered (including by facsimile or electronic mail transmission) in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart.

Section 19 ENTIRE AGREEMENT . This Agreement, and the Exhibits hereto, shall constitute the entire agreement between the parties hereto relating to the subject matter hereof. This Agreement expressly supersedes all prior agreements between the parties relating to the subject matter hereof, including the Term Sheet.

Section 20 GOVERNING LAW . THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF, INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW. THE PARTIES HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT IN THE COUNTY OF NEW YORK IN THE STATE OF NEW YORK WITH RESPECT TO ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND CONSENT TO THE SERVICE OF PROCESS IN ANY MANNER PERMITTED BY LAW. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING RELATING TO A DISPUTE AND FOR ANY COUNTERCLAIM WITH RESPECT THERETO ARISING OUT OF OR RELATING TO THIS AGREEMENT.

Section 21 PUBLICITY . Owner agrees that it will not, without the prior written consent of GS, in each instance, (a) use in advertising, publicity, or otherwise the name of GS, or any Affiliate thereof, or any partner or employee of GS, or any Affiliate thereof, nor any trade name, trademark, trade device, service mark, symbol or any abbreviation, contraction or simulation thereof owned by GS, or any Affiliate thereof, or (b) represent, directly or indirectly,

that any product or any service provided by GS has been approved or endorsed by GS, or any Affiliate thereof. No public announcement of any kind regarding the existence or terms of this Agreement shall be made without the prior written consent of the parties. For the avoidance of doubt, nothing in this 20 shall limit Owner’s obligation to disclose information pursuant to Section 11.

Section 22 FURTHER ACTS . In addition to the acts recited in this Agreement to be performed by Owner and GS, Owner and GS agree to perform or cause to be performed at the Closing or after the Closing any and all such further acts as may be reasonably necessary to consummate the transactions contemplated hereby.

Section 23 EXHIBITS . All attached Exhibits to this Agreement are incorporated herein by reference for all purposes.

Section 24 SURVIVAL . All agreements contained herein to be performed after the Closing shall survive the execution and delivery of this Agreement and any termination of this Agreement through the expiration of the Term.

Section 25 ASSIGNMENT; THIRD PARTIES . GS may not assign all or any part of this Agreement, or any of its rights with respect to any Facility, without the prior written consent of the Owner, provided that GS may assign this Agreement, or any of its rights to any Facility, to any Affiliate without such prior written consent. Each party shall immediately notify the other of any assignment of this Agreement.

Section 26 MISCELLANEOUS .

26.1 Owner acknowledges and agrees that except as may be required by applicable Law, nothing in this Agreement shall create a fiduciary duty of GS or its Affiliates to Owner or its members. Notwithstanding anything to the contrary in this Agreement, or any actions or omissions by representatives of the Owner or its Affiliates in whatever capacity, including as an observer to Owner’s board of managers, it is understood that neither GS nor its Affiliates is acting as a financial advisor, agent, or underwriter to Owner or any of its Affiliates or otherwise on behalf of Owner or any of its Affiliates unless retained to provide such services pursuant to a separate written agreement.

26.2 Owner acknowledges that GS is in the business of venture capital investing and therefore reviews the business plans and related proprietary information of many enterprises, including enterprises that may have products or services that compete directly or indirectly with those of Owner or its Affiliates. Except as provided in the Second Amended and Restated Operating Agreement of the Owner, dated as of the date hereof, nothing in this Agreement shall preclude or in any way restrict GS from investing or participating in any particular enterprise whether or not such enterprise has products or services that compete with those of GS or its Affiliates.

26.3 Owner hereby grants GS and its Affiliates permission to use GS’ name and logo in GS’ or its Affiliates’ marketing materials. GS or its Affiliates, as applicable, shall

include a trademark attribution notice giving notice of Owner’s ownership of its trademarks in the marketing materials in which Owner’s name and logo appear.

[Signature page follows]

IN WITNESS WHEREOF , the parties have executed and delivered the foregoing Agreement as of the day and year first above written.


CLEAN COAL SOLUTIONS, LLC

By:		/s/ Charles S. McNeil
Name:		Charles S. McNeil
Title:		Manager

GSFS INVESTMENTS I CORP.

By:		/s/ Albert Dombrowski
Name:		Albert Dombrowski
Title:		Authorized Signatory

S IGNATURE P AGE TO

E XCLUSIVE R IGHT TO L EASE A GREEMENT

EXCLUSIVE RIGHT TO LEASE AGREEMENT

LIST OF EXHIBITS


Exhibit A	—	Definitions

Exhibit B	—	Business Terms for Lease Documents

Exhibit C	—	Potential Leased Facilities

Exhibit D	—	Certification

EXHIBIT A

DEFINITIONS

As used in this Agreement, the following terms have the following meanings:

“ ADA ” means ADA-ES, Inc., a Colorado corporation.

“ AEC Project Agreements ” means collectively (a) the Agreement to Lease (as amended) dated June 29, 2010 among Owner, AEC-NM, LLC, AEC-TH, LLC and GS RC Investments LLC, (b) the Equipment Lease dated June 29, 2010 between AEC-NM, LLC and GS RC Investments LLC, (c) the Equipment Lease dated June 29, 2010 between AEC-TH, LLC and GS RC, (d) the Technology Sublicense Agreement dated June 29, 2010 among ADA, Owner, and GS RC, (e) the Operating and Maintenance Agreement (New Madrid) dated June 29, 2010 by and between GS RC and Clean Coal Solutions Services, LLC, (f) the Operating and Maintenance Agreement (Thomas Hill) dated June 29, 2010 between GS RC and Clean Coal Solutions Services, LLC, (g) the Chemical Additives Supply Agency Agreement (New Madrid) dated June 29, 2010 between GS RC and Clean Coal Solutions Services, LLC, (h) the Chemical Additives Supply Agency Agreement (Thomas Hill) dated June 29, 2010 between GS RC and Clean Coal Solutions Services, LLC and (i) the guarantees, each dated June 29, 2010, from each of ADA, NexGen Refined Coal, LLC, NexGen Investments LLLP and Republic Financial Corporation in favor of GS RC.

“ Affiliate ” means, with respect to any Person, any other Person controlling, controlled by or under common control with such first Person. For purposes of this definition and the Agreement, the term “control” (and correlative terms) means (a) the ownership of 50% or more of the equity interest in a Person, or (b) the power, whether by contract, equity ownership or otherwise, to direct or cause the direction of the policies or management of a Person. For the purposes of this definition, each of ADA, NexGen Refined Coal, LLC, NexGen Investments, LLLP and Republic Financial Corporation are Affiliates of Owner. For the purposes of this definition, any member of the federal income tax consolidated group of which such parent is a member are Affiliates of GS.

“ CEMS ” means continuous emissions monitoring system.

“ Closing ” has the meaning set forth in Section 8(c).

“ Code ” means the Internal Revenue Code of 1986, as amended.

“ Deposit ” has the meaning set forth in Section 7(a).

“ Environmental Laws ” means all applicable Laws and rules of common law pertaining to the protection of the environment, natural resources, workplace health and safety, the prevention of pollution or the remediation of contamination, including the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. § 9601 et seq.), the Emergency Planning and Community Right to Know Act and the Superfund Amendments and Reauthorization Act of 1986, the Solid Waste Disposal Act (42 U.S.C. § 6901 et seq.), the

A-17

Resource Conservation and Recovery Act of 1976, the Hazardous and Solid Waste Amendments Act of 1984, the Clean Air Act (42 U.S.C. § 7401 et seq.), the Clean Water Act (33 U.S.C. § 1251 et seq.), the Federal Water Pollution Control Act, the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Safe Drinking Water Act, the Occupational Safety and Health Act of 1970 (42 U.S.C. § 11001 et seq.), the Oil Pollution Act of 1990, the Hazardous Materials Transportation Act (49 U.S.C. § 1801 et seq.) the Federal Mine Safety and Health Act of 1977 (30 U.S.C. § 801 et seq.), and any similar or analogous statutes, regulations and decisional law of any Governmental Authority, as each of the foregoing may have been or are in the future amended or supplemented, in each case to the extent applicable with respect to the property or operation to which application of the term “Environmental Laws” relates.

“ Facility ” means a Refined Coal production facility owned by Owner or an Affiliate thereof.

“ Facility Tons ” has the meaning set forth in Section 7(a).

“ Governmental Authority ” means any governmental department, commission, board, bureau, agency, court or other instrumentality of any country, state, province, county, parish or municipality, jurisdiction, or other political subdivision thereof.

“ Group ” means, with respect to any party, such party and (a) the Affiliates of such party; (b) each guarantor of such party; (c) any other members, shareholders, partners or other equity owners of such party or any of its Affiliates (other than holders of publicly-traded units of such party or of any of its Affiliates, except any such holder that controls such party), and (d) the respective successors, assigns and Representatives of each Person described in the foregoing clause (a), (b) or (c), but shall in no event include the other parties’ respective Groups.

“ GS RC ” means GS RC Investments LLC, a Delaware limited liability company.

“ IRS Guidance ” means Internal Revenue Service Notice 2010-54, 2010-40 I.R.B. 403 or any superseding guidance issued supplementing the same.

“ Law ” means any applicable constitutional provision, statute, act, code, law, regulation, rule, ordinance, order, decree, ruling, proclamation, resolution, judgment, decision, declaration, or interpretative or advisory opinion or letter of a Governmental Authority having valid jurisdiction.

“ Lease Documents ” has the meaning set forth in Section 8(a).

“ Person ” means an individual, corporation, partnership, limited liability company, association, trust, unincorporated organization, or other entity.

“ Purchase Agreement ” means the Class B Unit Purchase Agreement dated as of this date by and between Owner and GS.

“ Refined Coal ” means a liquid, gaseous, or solid fuel produced from coal by the Facilities that produces, upon sale to an Unrelated Person, a Section 45 Credit.

A-18

“ Representative ” means, with respect to any Person, each manager, director, officer, employee, agent, consultant (including consulting engineers), advisor (including counsel and accountants), and other representative of such Person.

“ Right ” has the meaning set forth in Section 2.

“ Right Consideration ” has the meaning set forth in Section 4.

“ Section 45 Credit ” means the credit allowed by Section 45 of the Code for the production and sale of refined coal produced from coal.

“ Target Tons ” has the meaning set forth in Section 5.

“ Term ” has the meaning set forth in Section 5.

“ Term Sheet ” means that certain indicative term sheet, dated as of May 4, 2011, by and between the Owner and Goldman, Sachs & Co. and the side letter thereto dated May 10, 2011.

“ Ton ” means 2,000 pounds.

“ Unrelated Person ” means, with respect to any Person, any other Person that is not related to such Person within the meaning of Section 45(e)(4) of the Code.

“ Utility ” means any Person with whom GS (or any Affiliate thereof) may (or enter discussions to) contract with in order to site a Facility, purchase coal, sell Refined Coal and/or handle any arrangements in connection with the purchase, sale or supply of coal and Refined Coal.

“ Utility Agreements ” has the meaning set forth in Section 8(b).

“ Waiver ” has the meaning set forth in Section 7(b).

A-19

EXHIBIT B

BUSINESS TERMS FOR LEASE DOCUMENTS


1.	Lessor:	Affiliate of Owner.

2.	Lessee:	An Affiliate of GS.

3.	Facility:	A refined coal facility placed into service by Lessor at a site approved by Lessor and Lessee.

4	Lease Term:	Initial term of 5 years from the date of execution of the Lease Documents. Lessee has the right not to renew the equipment lease at the expiration of the initial term on the giving of notice consistent with the AEC Project Agreements. Renewal terms to be 12 months each, to be automatically renewed annually for 5 successive periods, provided that the equipment lease has not terminated (subject to the same conditions as are set forth in the AEC Project Agreements).

5.	Ongoing Payments:	Fixed payments sized and to be * of payments made under the equipment lease. Contingent payments to be sized and equal to * of payments made under the equipment lease.

6.	Prepaid Rent:	All amounts paid at Closing to Owner (including amounts previously paid in connection with the Deposit) shall constitute the Prepaid Rent (under and as defined in the AEC Project Agreements) and no further Prepaid Rent shall be payable by GS to Owner.

7.	Escrow:	The escrow mechanics (including the form of Escrow Agreement) set forth in the AEC Project Agreements shall be eliminated.

8.	Monetization Rate:	The monetization rate set forth in Exhibit C to the equipment leases in the AEC Project Agreements that are * are to be replaced with a monetization rate equal to $*.

9.	Clawbacks and Indemnities:	Indemnities and clawbacks limited to the following: a) Representations and warranties with respect to the existence of a party, its good standing, etc. at the date of Closing – indemnities limited to . b) Representations and warranties with respect to background materials, payment of taxes, compliance with Section 45 requirements – limited to .

B-20


		c) Bad boy acts – *.

10.	Parent Guarantees:	Consistent with and on the same terms as the AEC Project Agreements, each of ADA-ES, Inc., NexGen Refined Coal, LLC, NexGen Investments LLLP and Republic Financial Corporation shall provide a limited guaranty guaranteeing the obligations of the lessor; provided, however, that (i) no other Affiliate of either ADA-ES, Inc. or NexGen Refined Coal, LLC shall provide any guaranty and (ii) with respect to the limited guaranties provided by NexGen Investments LLLP and Republic Financial Corporation only, the Guaranty Cap (as defined in the existing guaranty agreements of NexGen Investments LLLP and Republic Financial Corporation in the AEC Project Agreements) shall apply in aggregate to the AEC Project Agreements and each new monetization transaction entered into by GS or any Affiliate and Owner or any Affiliate in respect of each Facility.

11.	Operating and Maintenance Agreement:	Clean Coal Solutions Services, LLC to be engaged as agent to procure and transport CyClean chemicals and as initial operator of future projects with GS under similar terms, including the right of GS to replace CCSS, as are set forth in the AEC Project Agreements.

12.	Technology Sublicense:	ADA as licensor and Owner as sublicensor shall grant to lessee a * sublicense of CyClean technology for each Facility on the same terms as are set forth in the AEC Project Agreements.

B-21

EXHIBIT C

POTENTIAL LEASED FACILITIES


Utility	Plant	Anticipated Annual Refined Coal Production (Tons)	Expected Demonstration Commencement Date
*	*	*	*
*	*	*	*
*	*	*	*
*	*	*	*
TOTAL		12,200,000

C-22

EXHIBIT D

CERTIFICATION

[CCS letterhead]

[DATE]

GSFS Investments I Corp.

c/o Goldman Sachs & Co.

200 West Street

New York, New York 10282

Re:	Certificate of Completion of Refined Coal Facility Testing

Dear Sirs:

Reference is made to that certain Exclusive Right to Lease Agreement (the “ Agreement ”), dated as of May , 2011, by and between GSFS Investments I Corp., a Delaware corporation (“ GSFS ”), and Clean Coal Solutions, LLC, a Colorado limited liability company (the “ Company ”). Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.

Pursuant to the terms of the Agreement, we hereby certify, represent and warrant as follows:

The testing of the refined coal production facility owned by the Company or one of its subsidiaries, identified by serial numbers [ ] (the “ Refined Coal Facility ”) at the [NAME OF PLANT], presently located at [ — ] and owned and operated by [UTILITY] (the “ Utility ”), pursuant to the terms of that certain Demonstration Agreement, dated as of , 201 , by and between the Utility and the Company, was completed on [ , 201 ] (the “ Testing Completion Date ”).

No grants described in Section 45(b)(3)(A)(i) of the Code have been provided by the United States, a state, or a political subdivision of a state for use in connection with all or part of the Facility within the meaning of such section.

No proceeds of any issue of a state or local government obligation described in Section 45(b)(3)(A)(ii) of the Code have or will be used to provide financing for all or part of the Facility within the meaning of such section.

No subsidized energy financing (within the meaning of Section 45(b)(3)(A)(iii) of the Code) has been or will be provided in connection with all or part of the Facility within the meaning of such section.

D-23

No other federal tax credit has been or is allowed or allowable with respect to all or part of the Facility within the meaning of Section 45(b)(3)(iv) of the Code.

10.

Attached to this certificate as Exhibit D are all capital expenditures made with respect to the Facility, (A) on or before the Testing Completion Date, and (B) after the Testing Completion Date (if any).

This certificate is executed and delivered on behalf of the Company by a duly authorized signatory of the Company as of the date first above written.


CLEAN COAL SOLUTIONS, LLC

By:
Name:
Title:

D-24

Exhibit A

To Certification

Refined Coal Production


Date		Refined Coal Production (Tons)

D-25

Exhibit B

To Certification

Certificate of Refined Coal Production

[CCS letterhead]

[DATE]

GSFS Investments I Corp.

c/o Goldman Sachs & Co.

200 West Street

New York, New York 10282

Re:	Verification of Refined Coal Production

Dear Sirs:

Reference is made to that certain Certificate of Completion of Refined Coal Facility Testing (the “ Certificate ”) dated as of , 2011, given by Clean Coal Solutions, LLC, a Colorado limited liability company (the “ Company ”) to GSFS Investments I Corp., a Delaware corporation (“ GSFS ”).

In accordance with the Certificate, we hereby verify the refined coal production on Exhibit A to the Certificate.

This Certificate is executed and delivered on behalf of the Company by a duly authorized signatory of the Company as of the date first above written.


CLEAN COAL SOLUTIONS, LLC

By:
Name:
Title:

D-26

Exhibit C

To Certification

Verification of Emissions Testing Results

This letter provides verification of the testing witnessed by [VERIFIER] for Clean Coal Solutions, LLC (“ CCS ”) as an independent engineering service regarding the coal refining facility installed at this site. The tests were conducted during the period [PERIOD] (“ Test Period ”). This verification is in accordance with IRS Notice 2010-54.

At the time of the testing the Facility was operated by Clean Coal Solutions Services, LLC, a Colorado limited liability company (“ CCSS ”) on behalf of CCS. The refined coal facility is located at [LOCATION] and owned by [UTILITY] (the “ Utility ”).

During the Test Period, CCSS operated the Facility on a daily, continuous basis for purposes of producing “refined coal” meeting the requirements of Section 45(c)(7) of the Internal Revenue Code of 1986, as amended (the “Code”), and meeting the requirements and specifications set forth in this certificate, in part, through the application of CyCleanTM, which consists of a solid additive (“ CyClean™ A ”) and a liquid additive (“ CyClean™ B ”), to coal feedstock consisting of Powder River Basin sub-bituminous coal (the “ Feedstock Coal ”).

During the operating period, CCSS was in charge of emissions testing performed in accordance with the operating process. [VERIFIER] observed the testing as an independent engineer to witness the results. CCS was responsible for establishing plant operating conditions with Feedstock Coal and Refined Coal and verifying nitrogen oxide (“ NOx ”) and mercury emission reductions achieved during the operating period as a result of burning the Refined Coal. [VERIFIER] was physically present at the site during the testing to ensure that the reported data is representative of the data observed during the tests. *.

Based upon the foregoing, the [VERIFIER] hereby certifies as follows:

The Facility produced a solid fuel from the Feedstock Coal (the “ Refined Coal ”).

The Refined Coal demonstrated a reduction of greater than 20 percent of the emissions of NOx and greater than 40 percent reduction of the emissions of mercury (collectively, the “ Emission Reductions ”) released when burning the Refined Coal (excluding any dilution caused by materials combined or added during the production process), as compared to the emissions released when burning the Feedstock Coal. Actual emission reductions for NOx were measured at approximately [ — ] percent below the baseline. Actual emissions of Hg were measured at [ — ] percent below the baseline measurements.

The Emission Reductions were determined by comparing the emissions that resulted when the Feedstock Coal and the Refined Coal were used to produce the same amounts of useful thermal energy. The CyCleanTM A and CyCleanTM B additives do not contain organic material, and therefore, the CyClean additives do not increase the thermal energy of the Feedstock Coal.

D-27

The Emission Reductions were determined in accordance with the provisions of Sections 6.01 and 6.02 of Notice 2010-54 *.

The Engineer understands and agrees that this Verification Statement of Emission Reductions Testing Method and Results for [PLANT] may be relied upon by CCS and its respective members, managers, successors, and assigns.

Under penalties of perjury, I declare that I have examined this verification statement and, to the best of my knowledge and belief, it is true, correct and complete.

Dated: [DATE]

[NOTARIZED SIGNATURE]

D-28

Exhibit D

To Certification

Capital Expenditures

D-29

Exhibit 10.85

EXECUTION VERSION

CLASS B UNIT PURCHASE AGREEMENT

between

CLEAN COAL SOLUTIONS, LLC

and

GSFS INVESTMENTS I CORP.

dated

May 27, 2011

*	Indicates portions of the exhibit that have been omitted pursuant to a request for confidential treatment. The non-public information has been separately filed with the Securities and Exchange Commission.

TABLE OF CONTENTS


Section 1.	DEFINITIONS.	5

Section 2.	AUTHORIZATION AND PURCHASE AND SALE OF CLASS B UNITS.	5

2.1	Authorization.	5
2.2	Purchase and Sale.	5

Section 3.	CLOSING.	5

Section 4.	REPRESENTATIONS AND WARRANTIES OF THE COMPANY.	6

4.1	Organization, Good Standing, and Qualification.	6
4.2	Subsidiaries of the Company.	6
4.3	Capitalization and Voting Rights.	7
4.4	Authority; Non-contravention; Governmental Authorization.	8
4.5	Valid Issuance of Securities.	9
4.6	Financial Statements.	10
4.7	Undisclosed Liabilities.	10
4.8	Accounts Receivable.	10
4.9	Conduct of Business.	11
4.10	Litigation.	11
4.11	Proprietary Assets.	11
4.12	Compliance with Legal Requirements; Governmental Authorizations.	12
4.13	No Registration Rights.	13
4.14	Assets and Liens; Facilities.	13
4.15	Real Property.	14
4.16	Benefit Plans.	14
4.17	Taxes.	15
4.18	Material Contracts.	16
4.19	Labor Agreements and Actions; Employees.	17
4.20	Environmental Matters.	18
4.21	Related Party Transactions.	19
4.22	Insurance.	19
4.23	Payments; Foreign Corrupt Practices Act; U.S. Export and Sanctions Laws.	20
4.24	No Brokers; No Finder’s Fees.	21
4.25	Investment Company.	21
4.26	Section 45 Credit.	21
4.27	Disclosure.	21

Section 5.	REPRESENTATIONS, WARRANTIES, AND CERTAIN AGREEMENTS OF THE INVESTOR.	22

5.1	Organization, Good Standing, and Qualification.	22
5.2	Authority; Non-contravention.	22
5.3	Purchase for Own Account.	22
5.4	Exempt Offering.	23


5.5	Investment Experience; Investigation.	23
5.6	Accredited Investor Status.	23
5.7	Restricted Securities.	23
5.8	Further Limitations on Disposition.	23
5.9	Legends.	24
5.10	No Brokers; No Finder’s Fees.	24

Section 6.	CONDITIONS TO THE INVESTOR’S OBLIGATIONS AT CLOSING.	25

6.1	Representations and Warranties.	25
6.2	Performance.	25
6.3	Consents and Waivers.	25
6.4	Securities Exemptions.	25
6.5	Proceedings and Documents.	25
6.6	Opinion of Company’s Counsel.	25
6.7	Restated Operating Agreement.	26
6.8	Exclusive Right to Lease.	26
6.9	Guarantees.	26
6.10	Legal Investment.	26
6.11	Due Diligence.	26

Section 7.	CONDITIONS TO THE COMPANY’S OBLIGATIONS AT CLOSING.	26

7.1	Representations and Warranties.	26
7.2	Performance.	26
7.3	Consents and Waivers.	26
7.4	Securities Exemptions.	26
7.5	Restated Operating Agreement.	27
7.6	Legal Investment.	27

Section 8.	INDEMNIFICATION; COVENANTS AND ADDITIONAL AGREEMENTS.	27

8.1	Indemnification.	27
8.2	Survival of Representations, Warranties, Covenants and Agreements.	32
8.3	Use of Proceeds.	32
8.4	Other Agreements and Covenants.	32
8.5	Tax Matters.	33

Section 9.	GENERAL PROVISIONS.	33

9.1	Disclosure Schedule.	33
9.2	Confidentiality.	33
9.3	Binding Effect; Third Parties.	34
9.4	Governing Law.	34
9.5	Counterparts.	35
9.6	Headings; Construction.	35
9.7	Notices.	35
9.8	Expenses and Obligations.	36

iii


9.9	Amendment, Modification, and Waiver.	36
9.10	Severability.	37
9.11	Entire Agreement.	37
9.12	Further Acts.	37
9.13	Delays or Omissions.	37
9.14	Assignment.	37
9.15	No Commitment for Additional Financing.	37

CLASS B UNIT PURCHASE AGREEMENT

This Class B Unit Purchase Agreement (this “ Agreement ”) is dated as of May 27, 2011 and is by and between Clean Coal Solutions, LLC, a Colorado limited liability company (the “ Company ”), and GSFS Investments I Corp., a Delaware corporation (the “ Investor ”).

RECITALS

The Company desires to sell and issue to the Investor, and the Investor desires to purchase and acquire from the Company, Class B Units of the Company, and the Company and the Investor desire to enter into the other agreements and consummate the other transactions contemplated by this Agreement, in each case on the terms and subject to the conditions of this Agreement and such other agreements.

In consideration of the foregoing recitals and the mutual promises set forth in this Agreement, the parties hereby agree as follows:

Section 1. DEFINITIONS. Capitalized terms used in this Agreement but not defined in the body of this Agreement have the meanings ascribed to them in Exhibit A . Capitalized terms defined in the body of this Agreement are listed in Exhibit A with reference to the location of the definition of such term in this Agreement.

Section 2. AUTHORIZATION AND PURCHASE AND SALE OF CLASS B UNITS.

2.1 Authorization . On or prior to the Closing, the Company shall authorize the issuance and sale, on the terms and subject to the conditions of this Agreement, of up to fifteen and fifteen-nineteenths (15 15/19) Class B Units, each having the relative rights, powers, restrictions, and liabilities set forth in the Second Amended and Restated Operating Agreement of the Company in the form attached to this Agreement as Exhibit B (the “ Restated Operating Agreement ”), which Restated Operating Agreement will, when executed and delivered by the parties thereto, replace in its entirety the Company’s Amended and Restated Operating Agreement, dated as of November 3, 2006 (as amended to date, the “ Existing Operating Agreement ”).

2.2 Purchase and Sale . On the terms and subject to the conditions of this Agreement, at the Closing, the Company shall issue, sell, and deliver to the Investor, and the Investor shall purchase from the Company, the number of Class B Units set forth next to the Investor’s name on Exhibit C under the column titled “Number of Class B Units” at a price of $3,800,000 per Class B Unit for a total purchase price equal to the amount set forth next to the Investor’s name on Exhibit C under the column titled “Total Purchase Price” (the “ Purchase Price ”) The Class B Units purchased and sold on the terms and subject to the conditions of this Agreement are collectively referred to in this Agreement as the “ Securities .”

Section 3. CLOSING. The purchase and sale of the Securities will take place at the offices of Vinson & Elkins L.L.P., 666 Fifth Avenue, 26 ^th Floor, New York, New York 10103 on the date of this Agreement at such time as agreed upon by the Company and the Investor or at

such other date, time, and place as the Company and the Investor agree upon (which date, time, and place are referred to in this Agreement as the “ Closing ” ). At the Closing, the Company shall update Exhibit A to the Restated Operating Agreement to reflect the issuance of the Securities to Investor against payment of the Purchase Price for the Securities, the Purchase Price to be paid by wire transfer of immediately available funds to an account designated by the Company.

Section 4. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

Except as set forth in the disclosure schedule (with specific reference to the subsection of this Section 4 to which the information stated in such disclosure schedule relates) delivered by the Company to the Investor on the Closing Date (the “ Disclosure Schedule ” ), the Company hereby represents and warrants to the Investor as of immediately prior to Closing as follows:

4.1 Organization, Good Standing, and Qualification .

(a) The Company has been duly formed and organized as a limited liability company, and is validly existing and in good standing, under the laws of the State of Colorado. The Company has all requisite limited liability company power and authority to use its name, to own and operate its properties and assets, and to carry on its business as currently conducted and as presently proposed to be conducted. The Company is presently registered or qualified to do business as a foreign limited liability company and is in good standing in each jurisdiction listed in Section 4.1(a) of the Disclosure Schedule. The Company is not required to be registered or qualified to do business as a foreign limited liability company in any other jurisdiction, except where the failure to be so registered or qualified would not be reasonably expected to have a Material Adverse Effect.

(b) The Company has delivered to the Investor and the Investor’s legal counsel true, correct, and complete copies of the Company’s articles of organization, as amended to date, the Existing Operating Agreement, and all minutes of all meetings of the Company’s members and managers and all committees thereof.

4.2 Subsidiaries of the Company .

(a) Section 4.2(a)(i) of the Disclosure Schedule sets forth a true, correct, and complete list of each Subsidiary of the Company. Except as set forth in Section 4.2(a)(ii) of the Disclosure Schedule, the Company is a member of and owns, free and clear of all Liens, 95% of all of the interests in or other securities of any kind of each such Subsidiary, ADA is a member of and owns 2.5% of all of the interests in or other securities of any kind of each such Subsidiary, and NexGen is a member of and owns 2.5% of all of the interests in or other securities of any kind of each such Subsidiary. With respect to each Subsidiary of the Company, (i) the Sharing Ratio (as defined in the applicable Subsidiary’s operating agreement, as amended to date) of the Company is 95%, the Sharing Ratio (as defined in the applicable Subsidiary’s operating agreement, as amended to date) of ADA is 2.5%, and the Sharing Ratio (as defined in the applicable Subsidiary’s operating agreement, as amended to date) of NexGen is 2.5%, and (ii) the initial cash contribution made by the Company to such Subsidiary was $950.00, the initial cash contribution made by ADA to such Subsidiary was $25.00, and the initial cash contribution made by NexGen to such Subsidiary was $25.00, and no other Person has made a cash contribution to such Subsidiary. All of the outstanding interests in or other securities of any kind

of each such Subsidiary are duly authorized, validly issued and fully paid. Except for the Company, ADA, and NexGen, there are no members of any Subsidiary of the Company. There are no outstanding securities or rights (including options, warrants, or similar rights) exercisable or exchangeable for or convertible into interests in or other securities of any kind of any Subsidiary of the Company. Except as set forth in Section 4.2(a)(iii) of the Disclosure Schedule, except for the interests in the Subsidiaries set forth in Section 4.2(a)(i) of the Disclosure Schedule, the Company does not own and has never owned, directly or indirectly, of record or beneficially, any capital stock of or other equity or voting interests in any Person.

(b) Each Subsidiary of the Company has been duly formed and organized as a limited liability company, and is validly existing and in good standing, under the laws of the State of Colorado. Each Subsidiary of the Company has all requisite limited liability company power and authority to use its name, to own and operate its properties and assets, and to carry on its business as currently conducted and as presently proposed to be conducted. Each Subsidiary of the Company has been duly formed as a manager-managed limited liability company under the Colorado Limited Liability Company Act, and the Company is the sole manager of each such Subsidiary. Each Subsidiary of the Company is presently registered or qualified to do business as a foreign limited liability company and is in good standing in each jurisdiction listed in Section 4.2(b) of the Disclosure Schedule. No Subsidiary of the Company is required to be registered or qualified to do business as a foreign limited liability company in any other jurisdiction, except where the failure to be so registered or qualified would not be reasonably expected to have a Material Adverse Effect.

(c) With respect to each Subsidiary of the Company, the Company has delivered to the Investor and the Investor’s legal counsel a true, correct, and complete copy of the articles of organization, as amended to date, and the operating agreement, as amended to date, of such Subsidiary.

4.3 Capitalization and Voting Rights .

(a) Interests in the Company are represented by and issued in the form of Units. Except for 50 issued and outstanding Units held of record by ADA and 50 issued and outstanding Units held of record by NexGen, there are no issued and outstanding Units. All of the issued and outstanding Units are Voting Units (as defined in the Existing Operating Agreement) and none are Non-voting Units (as defined in the Existing Operating Agreement). All of the issued and outstanding Units have been duly authorized, are validly issued and fully paid, and were issued in compliance with all applicable Legal Requirements. Except as set forth in Section 4.3(a) of the Disclosure Schedule and the issued and outstanding Units, there are no interests in or other securities of any kind of the Company, or any securities or rights (including options, warrants, or similar rights) exercisable or exchangeable for or convertible into interests in or other securities of any kind of the Company, authorized, issued, or outstanding, and there are no Contracts related to any of the foregoing. Upon the Closing, the Units outstanding immediately prior to Closing will be cancelled and exchanged for Class A Units of the Company in accordance with the Restated Operating Agreement, and the rights, powers, restrictions, and liabilities of the Units issued and outstanding following the Closing will be set forth in the Restated Operating Agreement.

(b) The Company has fully satisfied (including with respect to rights of timely notification), or obtained enforceable waivers in respect of, all preemptive or similar rights (including those set forth in the Existing Operating Agreement) directly or indirectly affecting, or exercisable in connection with, the issuance of the Securities. Except as set forth in Section 4.3(b) of the Disclosure Schedule, no interests in or securities of the Company, or interests in or securities of the Company issuable upon the exercise, exchange, or conversion of securities or rights (including options, warrants, or similar rights) of the Company, are subject to any preemptive rights, rights of first refusal, or other rights to purchase such interests or securities (whether in favor of the Company or any other Person) pursuant to any Contract or otherwise.

(c) Section 4.3(c) of the Disclosure Schedule sets forth the true, correct, and complete capitalization of the Company as of immediately following the Closing, including the number of issued and outstanding Units and the holders thereof, each Sharing Ratio (as defined in the Restated Operating Agreement), and each contribution to the Company in exchange for Units or other interests in the Company, the amount and kind of each such contribution, the date of each such contribution, and the Person from whom each such cash contribution was received.

(d) Except as set forth in Section 4.3(d) of the Disclosure Schedule, and except for the Existing Operating Agreement and the Term Sheet, the Company is not a party or subject to any Contract, and there is no Contract between any Persons, that affects or relates to the voting or giving of written consents with respect to any Unit or other interest in or security of the Company or by any manager or member of the Company.

4.4 Authority; Non-contravention; Governmental Authorization .

(a) The Company has the requisite limited liability company power and authority to execute and deliver the Transaction Agreements, to consummate the transactions contemplated thereby, and to comply with the provisions of the Transaction Agreements. The execution, delivery, and performance of the Transaction Agreements by the Company, the consummation by the Company of the transactions contemplated thereby, and the compliance by the Company with the provisions of the Transaction Agreements have been duly authorized by all necessary limited liability company action on the part of the Company and its managers and members, and no other limited liability company proceedings on the part of the Company or its managers or members are necessary to authorize the Transaction Agreements or to consummate the transactions contemplated thereby. This Agreement has been duly executed and delivered by the Company and, assuming the due authorization, execution, and delivery by the Investor, constitutes a valid and binding obligation of the Company enforceable against the Company in accordance with its terms except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and (ii) as may be limited by the effect of rules of law governing the availability of equitable remedies.

(b) The execution and delivery of the Transaction Agreements, the consummation of the transactions contemplated thereby, and the compliance by the Company with the provisions of the Transaction Agreements do not and will not conflict with, or result in

any violation or breach of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of, or result in, termination, cancelation, or acceleration of any obligation or to a loss of a benefit under, or result in the creation of any Lien in or upon any of the properties or assets of the Company or any of its Subsidiaries under, or give rise to any increased, additional, accelerated, or guaranteed rights or entitlements under, any provision of (i) the Company’s articles of organization, as amended to date, the Existing Operating Agreement, or the articles of organization, as amended to date, or the operating agreement, as amended to date, of any of the Company’s Subsidiaries, (ii) any loan or credit agreement, bond, debenture, note, mortgage, indenture, guarantee, lease, purchase order, or other Contract to which the Company or any of its Subsidiaries is a party or by which any of their respective properties or assets is subject, or (iii) any Legal Requirement or Order, in each case applicable to the Company or any of its Subsidiaries or any of their respective properties or assets, other than, in the case of clauses (ii) and (iii), any such conflicts, violations, breaches, defaults, rights, losses, Liens, or entitlements that individually or in the aggregate has not had and would not reasonably be expected to (A) have a Material Adverse Effect or affect the Investor in a material and adverse manner, (B) impair in any material respect the ability of the Company to perform its obligations under the Transaction Agreements, or (C) prevent or materially impede, interfere with, hinder, or delay the consummation of any of the transactions contemplated by the Transaction Agreements.

(c) No Governmental Authorization nor any approval, consent, ratification, waiver, or other appropriate authorization of any Person is required by or with respect to the Company or any of its Subsidiaries in connection with the execution and delivery of the Transaction Agreements, the consummation of the transactions contemplated thereby, or the compliance with the provisions of the Transaction Agreements, except for such Governmental Authorizations or such approvals, consents, ratifications, waivers, or other appropriate authorizations of such other Persons the failure of which to be obtained or made individually or in the aggregate has not had and would not reasonably be expected to (i) have a Material Adverse Effect or affect the Investor in a material and adverse manner, (ii) impair in any material respect the ability of the Company to perform its obligations under the Transaction Agreements, or (iii) prevent or materially impede, interfere with, hinder or delay the consummation of any of the transactions contemplated by the Transaction Agreements. The Company has obtained effective written waivers of any rights of first refusal, rights of first offer, or other similar rights of any Person that would be applicable to the transactions contemplated by the Transaction Agreements. The Company has delivered to the Investor and the Investor’s legal counsel true, correct, and complete copies of any filing made by the Company or any of its Subsidiaries with any Governmental Body in connection with the Transaction Agreements or the transactions contemplated thereby.

(d) Neither the Company nor any of its Subsidiaries is a party to or otherwise bound by any Contract that, as of the Closing, contains non-competition provisions that will be binding upon the Investor or its Affiliates.

4.5 Valid Issuance of Securities . The Securities, when issued and paid for as provided in this Agreement, will be duly authorized, validly issued and fully paid, and will be free of any and all Liens or restrictions on transfer (other than those created by the Transaction Agreements and applicable state or federal securities laws). Based in part on the representations

and warranties made by the Investor in Section 5 , the offer and sale of the Securities is exempt from the registration and prospectus delivery requirements of the Securities Act. The Company has not taken any action that would cause the issuance, sale, and delivery of the Securities to constitute a violation of the Securities Act or any applicable state securities laws.

4.6 Financial Statements .

(a) Section 4.6(a) of the Disclosure Schedule sets forth (i) the audited consolidated balance sheets of the Company and its Subsidiaries as of December 31, 2010 (the “ 2010 Balance Sheet ”), and the related consolidated statement of operations, consolidated statement of Members’ equity, and consolidated statement of cash flows of the Company and its Subsidiaries for the fiscal year ended on December 31, 2010 (collectively, the “ Audited Financial Statements ”), and (ii) the unaudited consolidated balance sheet of the Company and its Subsidiaries as of April 30, 2011, and the related unaudited consolidated statement of operations, consolidated statement of Members’ equity, and consolidated statement of cash flows of the Company and its Subsidiaries for the four month period then ended (collectively, the “ Unaudited Interim Financial Statements ” and, together with the Audited Financial Statements, the “ Financial Statements ”).

(b) The Financial Statements (i) are true, correct, and complete, (ii) were derived from and have been prepared in accordance with the underlying books and records of the Company and its Subsidiaries, (iii) have been prepared in accordance with generally accepted accounting principles in the United States (“ GAAP ”) consistently applied throughout the periods covered thereby, except that the Unaudited Interim Financial Statements may not contain all footnotes required by GAAP and are subject to normal year-end audit adjustments, and (iv) fairly and accurately present the assets, liabilities (including all reserves), and financial position of the Company and its Subsidiaries as of the dates thereof and the results of operations, members’ (deficit) equity, and changes in cash flows of the Company and its Subsidiaries for the periods then ended. There were no changes in the method of application of the Company’s accounting policies or changes in the method of applying the Company’s use of estimates in the preparation of the Unaudited Interim Financial Statements as compared with the Audited Financial Statements.

4.7 Undisclosed Liabilities . Except as set forth in the Audited Financial Statements, the Company and its Subsidiaries do not have any liabilities or obligations of any nature, either accrued, contingent, unasserted, or otherwise (whether or not required to be reflected on a balance sheet in accordance with GAAP), and whether due or to become due, other than liabilities or obligations incurred since the date of the Audited Financial Statements in the ordinary course of business consistent with past practice and similar in character and amount to the liabilities and obligations set forth on the Audited Financial Statements.

4.8 Accounts Receivable . All of the Company’s accounts receivable are bona fide, arose in the ordinary course of business, and are, to the Company’s Knowledge, collectible in the ordinary course of business. No Person has any Lien on any of such accounts receivable, and no request or agreement for deduction or discount has been made with respect to any of such accounts receivable. No such accounts receivable, or any accounts receivable or revenues reflected on the Financial Statements, have arisen as the result of prepaid services, goods sold on consignment, on approval, or on a sale or return basis or subject to any other repurchase, return, or prepayment arrangement.

4.9 Conduct of Business . Except as set forth in Section 4.9 of the Disclosure Schedule, since the date of the Audited Financial Statements, each of the Company and its Subsidiaries has conducted its business only in the ordinary course and only in a manner consistent with past practice and there has not been (a) any Material Adverse Effect or, to the Company’s Knowledge, any state of facts, change, development, effect, or occurrence that could reasonably be expected to result in a Material Adverse Effect, (b) any material change in financial or Tax accounting methods, principles, or practices by the Company or any of its Subsidiaries, or (c) any revaluation by the Company or any of its Subsidiaries of any of their assets. Since the date of the Audited Financial Statements, each of the Company and its Subsidiaries has continued all pricing, sales, receivables, payables, or inventory production practices in accordance with GAAP and in the ordinary course of business consistent with past practice.

4.10 Litigation . There is no Action pending or, to the Company’s Knowledge, threatened against the Company or its Subsidiaries or any of their respective activities, properties, or assets or against any of their officers, managers, or employees in connection with such officer’s, manager’s, or employee’s relationship with, or actions taken on behalf of, the Company or its Subsidiaries. Neither the Company nor its Subsidiaries is a party to or subject to the provisions of any Order of any Government Body, and there is no Action by the Company or its Subsidiaries currently pending or that the Company or its Subsidiaries intend to initiate.

4.11 Proprietary Assets .

(a) Section 4.11(a) of the Disclosure Schedule sets forth a true, correct, and complete list of all patents, patent applications, trademarks and service marks, trademark and service mark applications and registrations, trade names, copyright registrations, and licenses currently owned or used by the Company or its Subsidiaries or necessary for the conduct of their businesses as currently conducted, as well as any Contract under which the Company or its Subsidiaries has access to any intellectual property used by the Company or its Subsidiaries (the “ Proprietary Assets ”). The Company owns, or has the right to use (without additional license fees or royalties except as set forth in Section 4.11(a) of the Disclosure Schedule) under the Contracts or upon the terms described in Section 4.11(a) of the Disclosure Schedule, all of the Proprietary Assets and has used its commercially reasonable efforts to protect the Proprietary Assets. Except as set forth in Section 4.11(a) of the Disclosure Schedule, neither the Company nor any of its Subsidiaries is bound by or a party to any Contract of any kind with respect to the Intellectual Property Rights of any other Person. The business as currently conducted by the Company and its Subsidiaries does not cause the Company or its Subsidiaries to infringe or violate any of the patents, trademarks, service marks, trade names, copyrights, mask-works, licenses, trade secrets, processes, data, know-how, or other intellectual property rights (“ Intellectual Property Rights ”) of any other Person. Neither the Company nor its Subsidiaries has received any written notice that their businesses or their use of the Proprietary Assets is infringing the Intellectual Property Rights of any other Person.

(b) No manager or officer of the Company or its Subsidiaries owns any rights in any Intellectual Property Rights directly or indirectly competitive with those owned (or purported to be owned) by the Company or its Subsidiaries or derived by such Person from or in connection with the conduct of the Company’s or its Subsidiaries’ business. It is not necessary to use any inventions or works of authorship of any employees of the Company or its Subsidiaries (or persons the Company or its Subsidiaries currently intend to hire) made outside of their employment by the Company or its Subsidiaries. Except as set forth in Section 4.11(b)(i) of the Disclosure Schedule, the Company has obtained from all of the officers of the Company and its Subsidiaries and all of the developers of the Proprietary Assets that are owned by the Company or its Subsidiaries assignments to all inventions developed or conceived by such Persons during their association or within the scope of their employment, respectively, with the Company or its Subsidiaries and relating to their businesses. Except as set forth in Section 4.11(b)(ii) of the Disclosure Schedule, the Company has not granted rights to manufacture, produce, assemble, license, market, or sell its products to any other Person and is not bound by any Contract that may impair the Company’s rights to develop, manufacture, assemble, distribute, market, or sell its products.

(c) To the Company’s Knowledge, neither the Company nor any of its Subsidiaries has violated or infringed, and is currently not violating or infringing, any Intellectual Property Rights of any other Person.

4.12 Compliance with Legal Requirements; Governmental Authorizations . The Company is not in violation of or default on any provisions of its articles of organization, as amended to date, or the Existing Operating Agreement. Each of the Company and its Subsidiaries and their respective properties, assets, businesses, and operations have been and are being operated and have been and are in compliance with all Legal Requirements and Orders applicable to their properties, assets, businesses, or operations. Neither the Company nor any of its Subsidiaries has received a written notice or other written communication alleging a possible violation of any Legal Requirement or Order applicable to its properties, assets, businesses, or operations and no such written notice, communication, or allegation has been threatened in writing. Each of the Company and its Subsidiaries has in effect all Governmental Authorizations necessary for them to own, lease, or operate their respective properties and assets and to carry on their respective businesses as currently conducted, and all such Governmental Authorizations are listed in Section 4.12 of the Disclosure Schedule (the “ Scheduled Governmental Authorizations ”). Each of the Scheduled Governmental Authorizations is in full force and effect, and neither the Company nor any of its Subsidiaries has received a written notice or other written communication alleging a possible violation of, or default (with or without notice or lapse of time, or both) under, any of the Scheduled Governmental Authorizations. To the Company’s Knowledge, there is no event that would reasonably be expected to result in the revocation, cancelation, non-renewal, or adverse modification of any of the Scheduled Governmental Authorizations, and the transactions contemplated by the Transaction Agreements will not cause the revocation, cancelation, non-renewal, or adverse modification of any of the Scheduled Governmental Authorizations. The Company or one of its Subsidiaries, as applicable, is entitled to or has rights under each Scheduled Governmental Authorization. The Company has furnished to the Investor and the Investor’s legal counsel true, correct, and complete copies of each of the Scheduled Governmental Authorizations. All fees

and other payments due and owing in connection with the Scheduled Governmental Authorizations have been paid in full and in a timely manner. To the Company’s Knowledge, there are no past or present events, conditions, circumstances, activities, practices, incidents, actions, or plans that could reasonably be expected to (a) interfere with or prevent compliance or continued compliance by the Company or any of its Subsidiaries with any import/export Legal Requirements governing the Company’s or its Subsidiaries’ present and currently contemplated future operations or with any Legal Requirement, Order, notice, or demand letter issued, entered, promulgated, or approved thereunder, (b) give rise to any liability of the Company or any of its Subsidiaries under any import/export Legal Requirement governing the Company’s or its Subsidiaries’ past, present, and currently contemplated future operations, or (c) otherwise form a valid basis of any Action based on or related to the import or export of goods or services (including any basis relating to the encryption of the Company’s or its Subsidiaries’ products), and, to the Company’s Knowledge, no such events, conditions, circumstances, activities, practices, incidents, actions, or plans could reasonably be expected to arise in the future. Neither the Company nor any of its Subsidiaries is directly engaged in insurance, banking and financial services, telecommunications, public utility businesses, or any other regulated businesses.

4.13 No Registration Rights . Neither the Company nor any of its Subsidiaries is under any obligation to register under the Securities Act any securities or any securities issuable upon exercise or conversion of any securities, nor is the Company or any of its Subsidiaries obligated to register or qualify any such securities under any applicable state securities or blue-sky laws.

4.14 Assets and Liens; Facilities .

(a) The Company and its Subsidiaries own, have, and following the Closing will have, good and marketable title to, or a leasehold interest in, the assets of the Company and the Subsidiaries, which assets include all real and personal property necessary to conduct the business and operations of the Company and its Subsidiaries as presently conducted and as currently proposed to be conducted, other than assets, including without limitation all equipment and related materials, to be used in connection with Refined Coal production facilities not in place as of the date hereof. All of the personal property owned or leased by the Company or its Subsidiaries is in good and technically sound operating condition and repair, normal wear and tear excepted, is suitable for the purposes for which it is now being used, and has been maintained in a manner consistent with generally accepted industry standards. Each lease included in the assets of the Company is a valid and binding obligation of the Company and is in full force and effect, and neither the Company nor its Subsidiaries is and, to the Company’s Knowledge, no other party is, in default under any such lease. Except as set forth in Section 4.14(a) of the Disclosure Schedule, all of the Company’s assets are free and clear of all Liens.

(b) All of the equipment, machinery, and facilities that are included in the Facilities are in good operating condition and have been maintained in accordance with good operating practices, including the manufacturer’s recommendations. The equipment, machinery, and facilities that are included in the Facilities are fully functional and constitute all equipment, machinery, and facilities needed to produce Refined Coal. No warranty claim has been made by the Company or any of its Subsidiaries on the equipment, machinery, and facilities that are included in the Facilities. Except as set forth in Section 4.14(b) of the Disclosure Schedule, since the Facilities have become operational, there have been no material repairs made to the Facilities.

4.15 Real Property . Neither the Company nor any of its Subsidiaries own, and none of them have ever owned, any real property. Section 4.15 of the Disclosure Schedule sets forth a true, correct, and complete list of all parcels of real property leased, subleased, operated by, or otherwise used or occupied by the Company or its Subsidiaries (the “ Leased Real Property ”). The Company or one of its Subsidiaries has a valid leasehold interest in, or other right to occupy or use, each parcel of Leased Real Property. The Company has delivered to the Investor and the Investor’s legal counsel complete copies of all leases, guaranties, subleases, and other Contracts for the leasing, subleasing, operating, use or occupancy of the Leased Real Property. The Company and its Subsidiaries have complied with, and are in compliance with, all of their material obligations in connection with the Leased Real Property. Neither the Company nor any of its Subsidiaries have received any written termination notice or notice asserting any alleged overdue and unpaid material liability in connection with the Leased Real Property and, to the Company’s Knowledge, there are no conditions or circumstances that could reasonably be expected to result in the receipt of such notice. The Leased Real Property is in good operating condition and repair, and is available for use in and sufficient for the purposes and current demands of the business and operation of the Company and its Subsidiaries as currently conducted. To the Company’s Knowledge, except as set forth in Section 4.15 of the Disclosure Schedule, the Company will be able to renew or otherwise extend each lease, guaranty or sublease to which each parcel of Leased Real Property is subject, in each case on commercially reasonable terms.

4.16 Benefit Plans . Section 4.16 of the Disclosure Schedule lists all pension, retirement, profit sharing, stock, bonus, incentive, deferred compensation, severance, change of control, welfare, fringe benefit, or employee benefit plan, practice, or arrangement sponsored, maintained, or contributed to by the Company or its Subsidiaries, or with respect to which the Company or its Subsidiaries has any liability (direct, indirect, contingent, prospective or otherwise) as of the Closing (the “ Company Benefit Plans ”). Except as set forth on Section 4.16 of the Disclosure Schedule:

(a) all Company Benefit Plans have been maintained and operated in all material respects in accordance with all Legal Requirements applicable thereto and the terms and conditions of their governing documents;

(b) all contributions and funding due and owing respecting the Company Benefit Plans have been timely made;

(c) no Company Benefit Plan is subject to Title IV or Section 302 of ERISA or Section 412 of the Code (an “ ERISA Pension Plan ”), nor has any ERISA Pension Plan been maintained or contributed to within six years prior to Closing by the Company, any Subsidiary of the Company, or any Controlled Entity;

(d) no Company Benefit Plan is a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA (a “ Multiemployer Plan ”) or a plan that has two or more contributing sponsors at least two of whom are not under common control within the

meaning of Section 4063 of ERISA (a “ Multiple Employer Plan ”), nor has any Multiemployer Plan or Multiple Employer Plan ever been maintained or contributed to by the Company, any Subsidiary of the Company, or any Controlled Entity; and

(e) except for continuation coverage as required by Section 4980B of the Code or any similar applicable law, no Company Benefit Plan provides any life, health, medical, or other welfare benefits to former employees or beneficiaries or dependents thereof. Each Company Benefit Plan may be unilaterally amended or terminated in its entirety without liability except as to benefits accrued thereunder prior to such amendment or termination.

(f) The transactions contemplated by this Agreement will not cause the acceleration or vesting or payment of any benefits under any Company Benefit Plan and shall not otherwise accelerate or increase any liability of the Company under any Company Benefit Plan.

4.17 Taxes . Except as set forth on Section 4.17 of the Disclosure Schedule:

(a) all Tax Returns required to be filed by or with respect to the Company, its Subsidiaries, and the ownership or operation of the assets of the Company or its Subsidiaries have been duly filed and each such Tax Return is true, correct, and complete in all material respects;

(b) all Taxes owed by the Company or its Subsidiaries or for which the Company or its Subsidiaries may be liable that are or have become due have been paid in full;

(c) there are no Liens on any of the assets of the Company or its Subsidiaries that arose in connection with any failure to pay any Tax other than Liens for Taxes not yet due and payable;

(d) all Tax withholding and deposit requirements imposed on or with respect to the Company have been satisfied in full in all material respects;

(e) there is no claim pending by any Governmental Body in connection with any Tax owing by the Company, and no assessment, deficiency, or adjustment has been asserted, or to the Company’s Knowledge, proposed or threatened with respect to any Taxes or Tax Returns of or with respect to the Company or its Subsidiaries;

(f) no Tax audits, examinations or inquiries or investigations are being conducted with respect to the Company, its Subsidiaries, or any of their assets by any Governmental Body, and no written notice of any such event has been received;

(g) there are no agreements or waivers currently in effect that provide for an extension of time with respect to the filing of any Tax Return of the Company or its Subsidiaries or the assessment or collection of any Tax from the Company or its Subsidiaries;

(h) neither the Company nor any Subsidiary of the Company is a party to any Tax indemnity, allocation, or sharing arrangement;

(i) the Company has no liability for the Taxes of any Person under Treasury Regulations Section 1.1502-6 (or any corresponding provisions of state, local, or foreign Tax law), or as a transferee or successor, or by contract or otherwise;

(j) no claim has been made by any Governmental Body in a jurisdiction where the Company or a Subsidiary of the Company does not file a Tax Return that the Company (or a Subsidiary of the Company) is or may be subject to taxation in that jurisdiction;

(k) the Company is currently treated, and has been treated since formation, as a partnership for federal income tax purposes and has not made an election to be treated as an association taxable as a corporation for federal income tax purposes and each Subsidiary of the Company is currently treated, and has been treated since formation, as a partnership or disregarded entity for federal income tax purposes and has not made an election to be treated (or defaulted into classification) as an association taxable as a corporation for federal income tax purposes;

(l) no power of attorney that is currently in force has been granted with respect to any matter relating to Taxes that could affect the Company or its Subsidiaries following the Closing;

(m) all of the property of the Company and its Subsidiaries that is subject to property Tax has been properly listed and described on the property tax rolls of the appropriate taxing jurisdiction for all periods prior to the Closing and no portion of the property of the Company constitutes omitted property for property tax purposes; and

(n) neither the Company nor any of its Subsidiaries has participated in any transaction that is or is substantially similar to a “listed transaction” under Section 6011 of the Code and the Treasury Regulations thereunder, or any other transaction requiring disclosure under Treasury Regulation Section 1.6011-4.

4.18 Material Contracts .

(a) Other than Contracts existing as of the Closing between the Company or a Subsidiary of the Company, on one hand, and Investor or an Affiliate of Investor, on the other hand, Section 4.18 of the Disclosure Schedule sets forth a true, correct, and complete list of all Contracts to which the Company or any of its Subsidiaries is a party, or by which the Company or any of its Subsidiaries is bound, that are material to the business, operations, financial condition, or results of operations of the Company or any of its Subsidiaries (such Contracts listed on Section 4.18 of the Disclosure Schedule, the “ Material Contracts ”). Except as set forth in Section 4.18 of the Disclosure Schedule, the Company is not party to any Contract with Clean Coal Solutions Services, LLC.

(b) Neither the Company nor any of its Subsidiaries has breached or defaulted under, nor is there any written claim or threat that the Company or any of its Subsidiaries has breached or defaulted under, any term or condition of any Material Contract. Each Material Contract is in full force and effect and is a valid and binding agreement of and

enforceable against the Company or its Subsidiary, as applicable, and, to the Company’s Knowledge, the other parties thereto, and, to the Company’s Knowledge, no other party to any such Material Contract is in default under such Material Contract. To the Company’s Knowledge, there are no circumstances that are reasonably likely to occur that could reasonably be expected to adversely affect the Company’s or its Subsidiaries’ ability to perform their obligations under any Material Contract. The Company has delivered to the Investor and the Investor’s legal counsel true, correct, and complete copies of all Material Contracts (together with all amendments, modifications, and supplements thereto), and no Material Contract has been rescinded or terminated by the Company or the applicable Subsidiary of the Company.

(c) Each Contract between the Company or any of its Subsidiaries, on the one hand, and any Affiliate of the Company (excluding its Subsidiaries), on the other hand, was entered into in the ordinary course of business, is consistent with the past practice of the Company, and is on an arm’s-length basis.

4.19 Labor Agreements and Actions; Employees .

(a) Neither the Company nor any of its Subsidiaries is bound by or subject to (and none of their assets or properties are bound by or subject to) any written or oral, express or implied, Contract with any labor union, works council, or other employee representative, and no such organization has requested or, to the Company’s Knowledge, has sought to represent any of the employees, representatives, or agents of the Company or its Subsidiaries. There is no strike or other labor dispute involving the Company or its Subsidiaries pending or, to the Company’s Knowledge, threatened, nor to the Company’s Knowledge is there any labor organization activity involving its employees. To the Company’s Knowledge, no officer or key employee, or any group of key employees, intends to terminate his, her, or their employment with the Company or its Subsidiaries, nor does the Company or any of its Subsidiaries have a present intention to terminate the employment of any of the foregoing. The employment of each officer and employee of the Company and its Subsidiaries is terminable at the will of the Company or its Subsidiaries without cause. The Company and its Subsidiaries have materially complied with, and are in material compliance with, all applicable state and federal equal employment opportunity laws and other laws related to employment, including all Legal Requirements relating to labor and employment practices, terms and conditions of employment, employee classification, overtime pay, non-discrimination, wages and hours, employee leave, recordkeeping, payroll documents, immigration, occupational health and safety, collective bargaining, and the payment of employment-related Taxes, and to the Company’s Knowledge, no such notice, communication, or allegation has been threatened. Except as set forth on Section 4.19(a) of the Disclosure Schedule, neither the Company nor any of its Subsidiaries is a party to or bound by any currently effective employment or consultancy, severance, retention, or change-in-control Contract.

(b) Except to the extent accrued as a current liability on the Unaudited Interim Financial Statements, all wages, bonuses, and other compensation due and payable as of the Closing to employees and contractors of the Company and its Subsidiaries have been paid in full to such employees and contractors prior to or as of Closing.

(c) Neither the Company nor any of its Subsidiaries is subject to any Order with or relating to any present or former employee, employee representative, or any Governmental Body relating to claims of discrimination or other claims in respect of employment practices and policies. No Governmental Body has issued an Order with respect to the labor and employment practices (including practices relating to discrimination and wage payments) of the Company or its Subsidiaries.

4.20 Environmental Matters . Except as set forth in Section 4.20 of the Disclosure Schedule:

(a) The business of the Company and its Subsidiaries and the Leased Real Property, and the operations of the Company and its Subsidiaries with respect to the foregoing, are and have at all times been in compliance with all Environmental Laws. The Facilities have been owned and operated in compliance with all Environmental Laws, and the Facilities are capable of operating in compliance with all Environmental Laws, as such Environmental Laws exist or are in effect as of the date of the Closing, without material modification or capital investment.

(b) All Environmental Permits required under Environmental Laws in connection with the business of the Company and its Subsidiaries and the Leased Real Property, and the operations of the Company and its Subsidiaries with respect to the foregoing, have been obtained, and are currently in full force and effect, and there are no conditions under which any such existing Environmental Permit could be revoked or any pending application for any new Environmental Permit or renewal of any existing Environmental Permit could reasonably be expected to be protested or denied. The Company and its Subsidiaries have, or the applicable utility has, obtained, maintained, and complied in all material respects with the terms of all Governmental Authorizations required in connection with the ownership, operation, and maintenance of the Facilities.

(c) The business of the Company and its Subsidiaries and the Leased Real Property, and the operations of the Company and its Subsidiaries with respect to the foregoing, are not subject to any pending or, to the Company’s Knowledge, threatened Environmental Claims, nor has the Company or any of its Subsidiaries received any notice of violation, noncompliance, or enforcement that is currently pending. No Hazardous Substances exist in or on the Facilities, except as set forth in Section 4.20(c) of the Disclosure Schedule. No Hazardous Substances have been generated by, or released or discharged from, the Facilities at the Existing Sites where such release or discharge could reasonably be expected to result in a Claim or Proceeding pursuant to Environmental Laws.

(d) There has been no Release or threatened Release of Hazardous Substances at, on, under, or from any of the Leased Real Property, or in connection with the business of the Company or its Subsidiaries, in each case in violation of Environmental Laws or in a manner that would reasonably be expected to give rise to any liability under Environmental Laws, and there are no investigations, remediations, abatements, removals, or monitorings of Hazardous Substances required under any Environmental Laws with respect to the Leased Real Property or the operations of the Company or its Subsidiaries. To the Company’s Knowledge, there are no Hazardous Substances at the Existing Sites whose presence or existence is

attributable to the Company’s or its Subsidiaries’ ownership, operation or maintenance thereof that would reasonably be expected to adversely affect the continued operation of the Facilities at the Existing Sites. Any chemical additives in the Facilities as of the date hereof and any chemical additives currently used or proposed to be used by the Company or its Subsidiaries do not contain Hazardous Substances in quantities that require special Governmental Authorizations, handling, or reporting.

(e) Neither the Company nor any of its Subsidiaries has received any written notice asserting any alleged liability or obligation under any applicable Environmental Law with respect to the Release or threatened Release of any Hazardous Substances generated by the Company or its Subsidiaries at any location offsite of the Leased Real Property, and there are no conditions or circumstances that would reasonably be expected to result in the receipt of such notice. There are no existing or, to the Company’s Knowledge, threatened Proceedings, and neither the Company nor any of its Subsidiaries has received any Claim relating to violations of, or Environmental Losses under, Environmental Laws or to the presence, release, or discharge of any Hazardous Substances, in each case with respect to the Facilities or to the ownership, operation, or maintenance thereof. Neither the Company nor any of its Subsidiaries has received any notice from any Governmental Body or any other Person alleging any violation of any Environmental Laws with respect to the ownership, operation, or maintenance of the Facilities.

(f) The Company has provided to the Investor true, correct, and complete copies of all internal and external environmental audits and studies and all correspondence on substantial environmental matters, in each case in the Company’s possession or control relating to the Leased Real Property or the business of the Company.

(g) To the Company’s Knowledge, there has been no exposure of any person or property to any Hazardous Substances as a result of or in connection with the operations of the Company or its Subsidiaries that could form the basis for an Environmental Claim or any other claim for damages or compensation.

4.21 Related Party Transactions . Except as set forth in Section 4.21 of the Disclosure Schedule, within the last three years, neither the Company nor any of its Subsidiaries nor any Related Party (a) has or has had, either directly or indirectly, an interest or security (or any right to acquire any interest or security) in any Person that (i) furnishes or sells services or products that are furnished or sold or are proposed to be furnished or sold by the Company or any of its Subsidiaries, or (ii) purchases from or sells or furnishes to the Company or any of its Subsidiaries any goods or services or (b) has loaned money to or borrowed money from the Company or any of its Subsidiaries.

4.22 Insurance . Section 4.22 of the Disclosure Schedule sets forth a true, correct, and complete list and description, including annual premiums and deductibles, of all policies of fire, liability, product liability, workmen’s compensation, health, and other forms of insurance presently in effect with respect to the Company’s or its Subsidiaries’ properties, assets, operations, and businesses, true, correct, and complete copies of binders and/or policies which have been delivered to the Investor and the Investor’s legal counsel. All such policies are valid, outstanding, and enforceable policies and provide insurance coverage for the properties, assets, operations, and businesses of the Company and its Subsidiaries of the kinds, in the amounts, and

against the risks required to comply with applicable Legal Requirements. Such policies are sufficient to protect the properties, assets, operations, and businesses of the Company and its Subsidiaries against the risks of the sort normally insured by similar businesses. Neither the Company nor its Subsidiaries have been refused any insurance with respect to any property or asset or any aspect of their operations or business, and their coverage has not been limited by any insurance carrier to which they have applied for insurance or with which they have carried insurance. No written notice of cancelation or termination has been received with respect to any such policy. The activities and operations of the Company and its Subsidiaries have been conducted in a manner so as to conform to all applicable material provisions of such insurance policies.

4.23 Payments; Foreign Corrupt Practices Act; U.S. Export and Sanctions Laws . Without limiting any provision of this Agreement (including the provisions of Section 4.12 ):

(a) Neither the Company nor any of its Subsidiaries nor any manager, member, officer, agent, employee or other Person acting on behalf of the Company or any of its Subsidiaries has, in any manner related to the business of the Company or any of its Subsidiaries, directly or indirectly (i) paid or delivered or agreed to pay or deliver any fee, commission, or other sum of money or item of property, however characterized, to any Person, government official, or other party that is illegal or improper under any Legal Requirement, (ii) used any funds for any unlawful contribution, gift, entertainment, or other unlawful expense relating to political activity, (iii) made any unlawful payment or offered anything of value to any foreign or domestic government official or employee or to any foreign or domestic political parties or campaigns, (iv) violated or is in violation of any provision of the United States Foreign Corrupt Practices Act of 1977 (15 United States Code Section 78dd-1, et seq.), as amended, or any applicable Legal Requirement of similar effect, or (v) made any unlawful bribe, rebate, payoff, influence payment, kickback, or transfer of value to any other Person.

(b) The Company and each of its Subsidiaries has complied and is currently in compliance with applicable provisions of the United States export and sanctions laws, and regulations implemented thereunder, including without limitation the Arms Export Control Act (22 United States Code Section 2751 et seq.), as amended, the Export Administration Act (50 United States Code Section 2401 et seq.), as amended, the International Emergency Economic Powers Act (50 United States Code Section 17091 et seq.), as amended, and the various sanctions regulations administered by the Office of Foreign Assets Control of the Department of the Treasury of the United States, as amended. Without limiting the foregoing:

(i) Neither the Company nor any of its Subsidiaries has made any investments or performed any Contracts in, or involving a Person from, Cuba, Iran, Sudan, Syria, or Burma (Myanmar); and

(ii) With regard to any business conducted in or involving Cuba, Iran, Sudan, or Syria, neither the Company nor any of its Subsidiaries has exported any equipment to any of those countries or used any equipment in any of those countries (A) that was bought from the United States, (B) that was manufactured in the United States, or (C) that contains greater than 10% United States origin parts or components.

4.24 No Brokers; No Finder’s Fees . The Company has no Contract with any broker, finder, or similar agent with respect to the transactions contemplated by this Agreement that would obligate the Company for any finder’s or broker’s fee or commission in connection with the transactions contemplated by this Agreement.

4.25 Investment Company . Neither the Company nor any of its Subsidiaries is an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940 and the rules and regulations under the Investment Company Act of 1940 and is not deemed to be an “investment company” for purposes of Section 12(d)(1) of the Investment Company Act of 1940.

4.26 Section 45 Credit .

(a) No grants described in Section 45(b)(3)(A)(i) of the Code have been provided by the United States, a state, or a political subdivision of a state for use in connection with any project (within the meaning of Section 45 of the Code) under development or to be developed by the Company or its Subsidiaries.

(b) No proceeds of any issue of a state or local government obligation described in Section 45(b)(3)(A)(ii) of the Code have or will be used to provide financing for any project (within the meaning of Section 45 of the Code) under development or to be developed by the Company or its Subsidiaries.

(c) No subsidized energy financing (within the meaning of Section 45(b)(3)(A)(iii) of the Code) has been or will be provided in connection with any project (within the meaning of Section 45 of the Code) under development or to be developed by the Company or its Subsidiaries.

(d) No federal “energy credit” has been or is allowed or allowable with respect to all or part of any project within the meaning of Section 45 of the Code under development or to be developed by the Company or its Subsidiaries.

4.27 Disclosure . The Company has fully provided the Investor with all the information that the Investor has requested for deciding whether to purchase the Securities. Neither the Transaction Agreements nor any other statements or certificates made or delivered by the Company in connection with the Transaction Agreements contain any untrue statement of a material fact or omit a material fact necessary to make the statements in the Transaction Agreements not misleading. To the Company’s Knowledge, there is no information or fact that has or is reasonably likely to have a Material Adverse Effect that has not been disclosed to the Investor in this Agreement.

Section 5. REPRESENTATIONS, WARRANTIES, AND CERTAIN AGREEMENTS OF THE INVESTOR. The Investor hereby represents and warrants to the Company as of immediately prior to Closing, and agrees with the Company, as follows:

5.1 Organization, Good Standing, and Qualification . The Investor has been duly formed and organized as a corporation, and is validly existing and in good standing, under the laws of the State of Delaware. The Investor has all requisite corporate power and authority to use its name, to own and operate its properties and assets, and to carry on its business as currently conducted and as presently proposed to be conducted.

5.2 Authority; Non-contravention .

(a) The Investor has the requisite corporate power and authority to execute and deliver the Transaction Agreements to which it is a party, to consummate the transactions contemplated thereby, and to comply with the provisions of such Transaction Agreements. The Investor’s execution, delivery, and performance of the Transaction Agreements to which it is a party, the consummation by the Investor of the transactions contemplated thereby, and the compliance by the Investor with the provisions of such Transaction Agreements have been duly authorized by all necessary corporate action on the part of the Investor, and no other corporate proceedings on the part of the Investor are necessary to authorize such Transaction Agreements or to consummate the transactions contemplated thereby. This Agreement has been duly executed and delivered by the Investor and, assuming the due authorization, execution, and delivery by the Company, constitutes a valid and binding obligation of the Investor enforceable against the Investor in accordance with its terms except (a) as may be limited by applicable bankruptcy, insolvency, reorganization, or other laws of general application relating to or affecting the enforcement of creditors’ rights generally and (b) as may be limited by the effect of rules of law governing the availability of equitable remedies.

(b) The execution and delivery of the Transaction Agreements to which it is a party, the consummation of the transactions contemplated thereby, and the compliance by the Investor with the provisions of such Transaction Agreements do not and will not conflict with, or result in any violation or breach of (i) the Investor’s certificate of incorporation or bylaws, each as amended to date, or (ii) any Legal Requirement or Order, in each case applicable to the Investor or any of its properties or assets, other than in the case of clause (ii), any such conflicts, violations, or breaches that individually or in the aggregate has not had and would not reasonably be expected to (A) effect the Investor in a material and adverse manner, (B) impair in any material respect the ability of the Investor to perform its obligations under the Transaction Agreements to which it is a party, or (C) prevent or materially impede, interfere with, hinder, or delay the consummation of any of the transactions contemplated by the Transaction Agreements to which the Investor is a party.

5.3 Purchase for Own Account . The Investor is purchasing the Securities for investment for the Investor’s own account, not as a nominee or agent, and not with a view to the resale or distribution of such Securities in violation of any federal or state securities laws.

5.4 Exempt Offering . The Investor acknowledges that the Securities have not been registered under the Securities Act or any state or foreign securities laws and are being offered and sold pursuant to an exemption from registration contained in the Securities Act based in part upon the representations and warranties of the Investor set forth in this Section 5 .

5.5 Investment Experience; Investigation . The Investor acknowledges that acquisition of the Securities is a speculative investment which involves a substantial degree of risk of loss of the Investor’s entire investment in the Securities. The Investor has experience as an investor in securities of companies in the development stage and acknowledges that it is able to fend for itself, can bear the economic risk of its investment in the Securities, and has such knowledge and experience in financial or business matters that it is capable of evaluating the merits and risks of an investment in the Securities. Investor acknowledges that it has had adequate access to Company management, has had the opportunity to ask questions and receive answers from Company management, and has been provided will all documentation and information requested from the Company in connection with its decision to make an investment in the Securities.

5.6 Accredited Investor Status . The Investor is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act, as presently in effect.

5.7 Restricted Securities . The Investor understands that the Securities are characterized as “restricted securities” under the Securities Act inasmuch as they are being acquired from the Company in a transaction not involving a public offering and the Securities may not be sold, transferred, offered for sale, pledged, hypothecated or otherwise disposed of unless such transfer, sale, assignment or other disposition is pursuant to the terms of an effective registration statement under the Securities Act and any applicable state or foreign securities laws or sold pursuant to an exemption from registration under the Securities Act and any applicable state or foreign securities laws. The Investor is familiar with Rule 144 under the Securities Act, as presently in effect, and understands the resale limitations imposed by Rule 144 under the Securities Act and by the Securities Act. The Investor understands that the Company is under no obligation to register any of the Securities sold under this Agreement.

5.8 Further Limitations on Disposition . Without in any way limiting the representations and warranties of the Investor set forth above in this Section 5 , the Investor shall not make any disposition of all or any portion of the Securities unless and until it has complied with all requirements related to disposition of the Securities under the Restated Operating Agreement and:

(a) there is then in effect a registration statement under the Securities Act covering such proposed disposition and such disposition is made in accordance with such registration statement; or

(b) the Investor has first notified the Company of the proposed disposition and has furnished the Company with a statement of the circumstances surrounding the proposed disposition.

Notwithstanding the provisions of Section 5.8(a) and Section 5.8(b) above, no such registration statement shall be required for: (a) any transfer of any Securities in compliance with Rule 144 or Rule 144A under the Securities Act (it being agreed that the Company shall have the right to receive evidence satisfactory to it regarding compliance with such rule or any successor or analogous rule prior to the registration of any such transfer) or (b) any transfer of any Securities to an Affiliate of the Investor (including any deemed transfer by reason of a change of control of the Investor or its Affiliates) in compliance with the terms of the Restated Operating Agreement; provided, that the transferee shall, prior to giving effect to such transfer, agree in writing to be subject to the terms of this Section 5 to the same extent as if the transferee were the Investor under this Agreement.

5.9 Legends . The certificates evidencing the Securities, if any, shall bear the legends set forth below (in addition to any legend required under applicable state securities laws):

(a) “THE UNITS REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED ON , , HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER APPLICABLE STATE SECURITIES LAWS (“STATE ACTS”) AND MAY NOT BE SOLD, ASSIGNED, PLEDGED, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR STATE ACTS OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE TRANSFER OF THE UNITS REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE CONDITIONS SPECIFIED IN THE SECOND AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT, AS AMENDED, MODIFIED AND/OR RESTATED FROM TIME TO TIME, OF CLEAN COAL SOLUTIONS, LLC (THE “COMPANY”), BY AND AMONG THE COMPANY AND ITS MEMBERS (THE “LLC AGREEMENT”), A COPY OF WHICH SHALL BE FURNISHED BY THE COMPANY UPON WRITTEN REQUEST AND WITHOUT CHARGE.”

(b) Any other legends required by federal or state securities laws applicable to the Investor.

The Company shall remove the portion of the legend set forth in Section 5.9(a) relating to restrictions under the Securities Act and state securities laws from any certificate evidencing the Securities upon delivery to the Company of an opinion of counsel, reasonably satisfactory to the Company, that a registration statement under the Securities Act is at that time in effect with respect to the legended security or that such security can be freely transferred in a public sale without such a registration statement being in effect and that such transfer shall not jeopardize the exemption or exemptions from registration pursuant to which the Company issued the Securities.

5.10 No Brokers; No Finder’s Fees . The Investor has no Contract with any broker, finder, or similar agent with respect to the transactions contemplated by this Agreement that would obligate the Investor for any finder’s or broker’s fee or commission in connection with the transactions contemplated by this Agreement.

Section 6. CONDITIONS TO THE INVESTOR’S OBLIGATIONS AT CLOSING. The obligations of the Investor under this Agreement are subject to the fulfillment or waiver, on or before the Closing, of each of the following conditions, the waiver of which will not be effective against the Investor unless such waiver is given by the Investor in writing to the Company:

6.1 Representations and Warranties . Each of the representations and warranties of the Company set forth in Section 4 shall be true, correct, and complete on and as of the Closing.

6.2 Performance . The Company shall have performed and complied with all agreements, obligations, and conditions contained in this Agreement that are required to be performed or complied with by the Company on or before the Closing.

6.3 Consents and Waivers . The Company shall have obtained each Governmental Authorization and each approval, consent, ratification, waiver, or other appropriate authorization from each Person necessary or appropriate (under Contracts to which the Company or its Subsidiaries are a party or otherwise) for the consummation of the transactions contemplated by the Transaction Agreements, and the same shall be effective as of the date of the Closing.

6.4 Securities Exemptions . The offer and sale of the Securities to the Investor shall be exempt from the registration requirements of the Securities Act and the registration or qualification requirements of all other applicable state securities laws.

6.5 Proceedings and Documents . All limited liability company and other proceedings in connection with the transactions contemplated by this Agreement, and all documents incident to such proceedings, shall be reasonably satisfactory in form and substance to the Investor and its legal counsel, and the Investor shall have received all such counterparts of such documents as the Investor or its legal counsel may reasonably request. Such documents shall include the following:

(a) A copy of the Company’s articles of organization, as amended to date, and the Existing Operating Agreement, in each case certified by a manager of the Company as true, correct, and complete executed copies of such articles of organization and the Existing Operating Agreement.

(b) A copy of the resolutions adopted by the Company’s managers and members by which the Company’s managers and members approved the issuance and sale of the Securities to the Investor, the Company’s execution and delivery of the Transaction Agreements, and the other transactions contemplated by this Agreement.

6.6 Opinion of Company’s Counsel . The Investor shall have received an opinion dated the date of the Closing of Hogan Lovells US LLP, counsel to the Company, addressed to the Investor and substantially in the form attached to this Agreement as Exhibit D .

6.7 Restated Operating Agreement . The Company, the Investor, and each of the other members of the Company shall have executed and delivered the Restated Operating Agreement.

6.8 Exclusive Right to Lease . The Investor and the Company shall have executed and delivered the Exclusive Right to Lease, and the Exclusive Right to Lease shall be in full force and effect.

6.9 Guarantees . Each of ADA and NexGen shall have executed and delivered to the Investor a Guarantee, and each such Guarantee shall be in full force and effect.

6.10 Legal Investment . At the time of the Closing, the purchase and sale of the Securities shall be legally permitted by all Legal Requirements to which the Investor and the Company are subject.

6.11 Due Diligence . The Company shall have provided the Investor access to such information as the Investor reasonably requested in connection with its legal, Tax, and financial due diligence review and the Investor shall have concluded its legal, Tax, and financial due diligence review of the Company to the Investor’s complete satisfaction.

Section 7. CONDITIONS TO THE COMPANY’S OBLIGATIONS AT CLOSING. The obligations of the Company under this Agreement are subject to the fulfillment or waiver, on or before the Closing, of each of the following conditions, the waiver of which will not be effective against the Company unless such waiver is given by the Company in writing to the Investor:

7.1 Representations and Warranties . Each of the representations and warranties of the Investor set forth in Section 5 shall be true, correct, and complete on and as of the Closing (except for such representations and warranties made as of a certain date, which shall be true and correct as of such date as though made on and as of such date).

7.2 Performance . The Investor shall have performed and complied with all agreements, obligations, and conditions contained in this Agreement that are required to be performed or complied with by the Investor on or before the Closing.

7.3 Consents and Waivers . The Company shall have obtained each Governmental Authorization and each approval, consent, ratification, waiver, or other appropriate authorization from each Person necessary or appropriate (under Contracts to which the Company or its Subsidiaries are a party or otherwise) for the consummation of the transactions contemplated by the Transaction Agreements, and the same shall be effective as of the date of the Closing.

7.4 Securities Exemptions . The offer and sale of the Securities to the Investor shall be exempt from the registration requirements of the Securities Act and the registration or qualification requirements of all other applicable state securities laws.

7.5 Restated Operating Agreement . The Company, the Investor, and each of the other members of the Company shall have executed and delivered the Restated Operating Agreement.

7.6 Legal Investment . At the time of the Closing, the purchase and sale of the Securities shall be legally permitted by all Legal Requirements to which the Investor and the Company are subject.

Section 8. INDEMNIFICATION; COVENANTS AND ADDITIONAL AGREEMENTS.

8.1 Indemnification .

(a) Indemnification by the Company . Subject to the terms and conditions of this Section 8.1 , the Company shall defend and hold harmless the Investor and its Affiliates and each of their respective officers, directors, employees, agents, equity holders or the successors and assigns of the foregoing (collectively, the “Investor Indemnified Parties ” and each, an “Investor Indemnified Party ”) against and from all Losses suffered, sustained or incurred by any Investor Indemnified Party, whether in respect of Third Party Claims, claims between the parties hereto, or otherwise directly or indirectly relating to, as a result of or arising out of:

(i) any inaccuracy in or breach of any representation and warranty made by the Company in this Agreement (other than Company Statutory Representations and Warranties and Company Fundamental Representations and Warranties) or the Exclusive Right to Lease;

(ii) any inaccuracy in or breach of any Company Statutory Representations and Warranties;

(iii) any inaccuracy in or breach of any Company Fundamental Representations and Warranties; or

(iv) any breach of, or failure by, the Company to comply with any covenant or obligation under this Agreement or the Exclusive Right to Lease to be performed by the Company or its Affiliates.

(b) Indemnification by the Investor . Subject to the terms and conditions of this Section 8.1 , the Investor shall indemnify, defend and hold harmless the Company, its Affiliates and their respective officers, directors, employees, agents, equity holders or the successors and assigns of the foregoing (collectively, the “Company Indemnified Parties ” and each a “Company Indemnified Party ” ) against and from all Losses suffered, sustained or incurred by any Company Indemnified Party, whether in respect of Third Party Claims, claims between the parties hereto, or otherwise directly or indirectly relating to, as a result of or arising out of:

(i) any inaccuracy in or breach of any representation and warranty made by the Investor in this Agreement (other than Investor Fundamental Representations and Warranties) or the Exclusive Right to Lease;

(ii) any inaccuracy in or breach of any Investor Fundamental Representations and Warranties; or

(iii) any breach of, or failure by, the Investor to comply with any covenant or obligation under this Agreement or the Exclusive Right to Lease to be performed by the Investor or its Affiliates.

(i) Other than with respect to breaches of Company Fundamental Representations and Warranties, the Investor Indemnified Parties shall not be entitled to recover under Section 8.1(a) until the total amount of Losses which the Investor Indemnified Parties would recover under this Section 8.1 exceeds an aggregate amount equal to $500,000 (the “ Deductible ”), in which case the Investor Indemnified Parties shall be entitled to recover all Losses in excess of the Deductible (subject to Section 8.1(c)(iii) ). All materiality qualifications contained in the Company’s representations and warranties made in Section 4 of this Agreement or in the Exclusive Right to Lease, including the term “Material Adverse Effect”, shall be taken into account under this Section 8 solely for purposes of determining whether a breach or violation has occurred for which an indemnity obligation exists. Without limiting the generality of the foregoing, all such qualifications shall be ignored and not given effect for purposes of determining whether the Deductible threshold set forth in this Section 8.1(c)(i) has been surpassed, or the amount of any Damages resulting from any such breach or violations, after it has been determined that a breach or violation has occurred.

(ii) Other than with respect to breaches of Investor Fundamental Representations and Warranties, the Company Indemnified Parties shall not be entitled to recover under Sections 8.1(b) until the total amount of Losses which the Company Indemnified Parties would recover under this Section 8.1 exceeds an aggregate amount equal to the Deductible, in which case the Company Indemnified Parties shall be entitled to recover all Damages in excess of the Deductible (subject to Section 8.1(c)(iv) ).

(iii) The aggregate amount of indemnification that the Investor Indemnified Parties may receive to satisfy all claims under Section 8.1(a) shall be the Purchase Price. In no event shall any Investor Indemnified Party be entitled to recover any Losses pursuant to this Section 8.1 in excess of the Purchase Price.

(iv) The aggregate amount of indemnification that the Company Indemnified Parties may receive to satisfy all claims under Section 8.1(b) shall be the Purchase Price. In no event shall any Company Indemnified Party be entitled to recover any Losses pursuant to this Section 8.1 in excess of the Purchase Price.

(v) The Investor and the Company agree that in the event of any breach giving rise to an indemnification obligation under this Section 8.1 , the Indemnitee, at the sole cost and expense of the Indemnitor, shall and shall cause its Affiliates to reasonably cooperate with the Indemnitor and to take all reasonable measures, requested by such Indemnitor or otherwise, to mitigate the consequences of the related breach.

(vi) The Indemnitee shall, at the expense of the Indemnitor, use its commercially reasonable efforts to pursue recovery against third parties, under insurance policies or from collateral sources. In the event any amounts recovered from any third party or under such insurance policies or other collateral sources are not received before any claim for indemnification is paid pursuant to this Section 8.1 , then the amount of such subsequent recovery shall be applied first, to reimburse the Indemnitee for its out-of-pocket expenses (including reasonable attorney’s fees and expenses) expended in pursuing such recovery, and second, refund any payments made by the Indemnitor which would not have been so paid had such recovery been obtained prior to such payment, and third, any excess to the Indemnitee.

(vii) The Indemnitor shall be subrogated to the rights of the Indemnitee in respect of any insurance relating to the Losses to the extent of any indemnification payments made hereunder. Any liability for indemnification hereunder shall be determined without duplication of recovery by reason of the state of facts giving rise to such liability constituting a breach of more than one representation, warranty, covenant or agreement.

(d) Notice and Procedures . In the event that any Actions are instituted by a third party or any claim or demand is asserted or threatened against or sought to be collected from a Person who is seeking indemnity under any provision of this Agreement (the “ Indemnitee ”) by a third party, in each case for which the party from whom indemnity is sought (the “ Indemnitor ”) may have liability to any Indemnitee hereunder (a “ Third Party Claim ”), such Indemnitee shall promptly, but in no event more than fifteen (15) days, following such Indemnitee’s receipt of a Third Party Claim, notify the Indemnitor in writing and in reasonable detail, to the extent available, of such Third Party Claim (a “ Claim Notice ”). The Indemnitor shall have thirty (30) days (or such lesser number of days as may be required by court proceeding in the event of a litigated matter) after receipt of the Claim Notice (the “ Notice Period ”) to notify the Indemnitee that it desires to defend the Indemnitee against such Third Party Claim. The Claim Notice shall (i) state that the Indemnitee has incurred, or reasonably and in good faith expects to incur, Losses for which such Indemnitee is entitled to indemnification pursuant to this Agreement; and (ii) specify in reasonable detail, to the extent available, the nature of such Third Party Claim and an estimate of the amount of the applicable Losses (if reasonably practicable) to which such Indemnitee reasonably and in good faith believes it may be entitled to hereunder. Thereafter, the Indemnitee shall deliver to the Indemnitor, promptly following the Indemnitee’s receipt thereof, copies of all notices and documents (including court

papers and excluding all internally prepared documents or documents prepared by counsel or other representatives of Indemnitee) received by the Indemnitee relating to the Third Party Claim.

(e) Defense of Third Party Claims by Indemnitor . In the event that the Indemnitor notifies the Indemnitee within the Notice Period that it desires to defend the Indemnitee against a Third Party Claim, (i) the Indemnitor shall have the right to defend the Indemnitee by appropriate proceedings and shall have the sole power to direct and control such defense, with counsel of its choosing, at its expense, (ii) the Indemnitor shall use its commercially reasonable efforts to defend diligently such Third Party Claim, (iii) the Indemnitee, prior to the period in which the Indemnitor assumes the defense of such matter, shall take all reasonable actions to preserve any and all rights with respect to such matter, without such actions being construed as a waiver of the Indemnitee’s rights to defense and indemnification pursuant to this Agreement, and (iv) the Indemnitor shall be deemed to have agreed that it shall indemnify the Indemnitee for all Damages resulting from such Third Party Claim pursuant to and subject to the conditions of this Section 8.1 . Once the Indemnitor has duly assumed the defense of a Third Party Claim, the Indemnitee shall have the right, but not the obligation, to participate in any such defense and to employ separate counsel of its choosing. The Indemnitee shall participate in any such defense at its expense and shall cooperate in the defense or prosecution of such Third Party Claim; provided , however , that such Indemnitee shall be entitled to participate in any such defense with separate counsel at the reasonable expense of the Indemnitor if, in the reasonable opinion of counsel to the Indemnitee, a conflict or potential conflict exists between the Indemnitee and the Indemnitor that would make such separate representation advisable; and provided , further , that the Indemnitor shall not be required to pay for more than one such counsel for all Indemnitees in connection with any Third Party Claim.

(f) Defense of Third Party Claims by Indemnitee . Notwithstanding anything in Section 8.1(e) to the contrary, if a Third Party Claim seeks relief that would result in the imposition of a consent order, injunction or decree, in any case that would materially restrict the future activity or conduct of the Indemnitee or any of its Affiliates, then the Indemnitee shall be entitled to contest and defend, and subject to Section 8.1(h) , compromise and settle such Third Party Claim in the first instance; provided that if the Indemnitee does not contest, defend, compromise or settle such Third Party Claim, the Indemnitor shall then have the right to contest and defend, and subject to Section 8.1(h) , settle or compromise such Third Party Claim. If the Indemnitee has duly assumed the defense of a Third Party Claim, the Indemnitor shall have the right, but not the obligation, to participate in any such defense and to employ separate counsel of its choosing (at the expense of the Indemnitor). If the Indemnitor (i) does not elect to defend the Indemnitee against a Third Party Claim, whether by not giving the Indemnitee timely notice of its desire to so defend or otherwise or (ii) after assuming the defense of a Third Party Claim, fails to take commercially reasonable steps necessary to defend diligently such Third Party Claim within thirty (30) days (or such lesser number of days as may be required by court proceeding in the event of a litigated matter) after receiving written notice from the Indemnitee to the effect that the Indemnitor has so failed, the Indemnitee shall have the right but not the obligation to assume such defense and shall have the sole power to direct and control such defense, with counsel of its choosing, at the expense of the Indemnitor.

(g) Cooperation . The Indemnitee and the Indemnitor shall cooperate in the conduct of the defense of a Third Party Claim, including by retaining records and information that are reasonably relevant to such Third Party Claim and providing reasonable access to each other’s relevant business records and other documents, and employees. The Indemnitee and the Indemnitor shall use commercially reasonable efforts to avoid production of confidential information (consistent with applicable Law), and to cause all communications among employees, counsel and others representing any party to a Third Party Claim to be made so as to preserve any applicable attorney-client or work-product privileges.

(h) Settlement of Third Party Claims . The Indemnitor shall not, without the prior written consent of the Indemnitee, not to be unreasonably withheld or delayed, settle, compromise or offer to settle or compromise any Third Party Claim. Whether or not the Indemnitor assumes the defense of a Third Party Claim, the Indemnitee shall not, without the prior written consent of the Indemnitor, not to be unreasonably withheld or delayed, settle, compromise or offer to settle or compromise any Third Party Claim.

(i) Direct Claims . In the event any Indemnitee has a claim against any Indemnitor that does not involve, or no longer involves, a Third Party Claim, the Indemnitee shall deliver a notice of such claim (a “ Direct Claim Notice ”) and the amount of the applicable Losses or an estimate of the amount of the applicable Losses (if reasonably practicable) with reasonable promptness to the Indemnitor. If the Indemnitor notifies the Indemnitee that it does not dispute the claim described in such notice or fails to notify the Indemnitee, within thirty (30) days after delivery of such notice by the Indemnitee whether the Indemnitor disputes the claim described in such notice, the Losses in the amount specified in the Indemnitee’s notice will be conclusively deemed a liability of the Indemnitor and the Indemnitee shall be entitled to recover the amount of such Losses from the Indemnitor in accordance with the terms and conditions of this Section 8.1 . If the Indemnitor has timely disputed its liability with respect to such claim, the Indemnitor and the Indemnitee will proceed in good faith to negotiate a resolution of such dispute, and the Indemnitor shall not be obligated to make any payment with respect to such claim until such claim has been so resolved by the Indemnitor and the Indemnitee or has been determined in favor of the Indemnitee by a final judgment, order or decree of an arbitrator or a court of competent jurisdiction (which is not appealable or with respect to which the time for appeal therefrom has expired and no appeal has been perfected).

(j) Treatment of Payments . Any indemnification payments made by the Company under this Section 8.1 to the Investor, other than indemnification payments made by the Company to reimburse the Investor in respect of payments made by any Investor Indemnified Party in respect of Third Party Claims and any reasonable related costs and expenses thereto, shall reduce the Unrecovered Investment Balance in accordance with Section 4.5(d)(v) of the Restated Operating Agreement.

8.2 Survival of Representations, Warranties, Covenants and Agreements .

(a) The representations, warranties, covenants, and other agreements of the Company and the Investor set forth in or made in connection with this Agreement, and the indemnification obligations of the parties with respect thereto, shall survive the execution and delivery of this Agreement and the Closing as follows:

(i) with respect to the representations and warranties set forth in Sections 4.1 , 4.2 , 4.3 , 4.4 and 4.5 (the “ Company Fundamental Representations and Warranties ”) and in Sections 5.1 and 5.2 (the “ Investor Fundamental Representations and Warranties ”), such representations and warranties shall survive indefinitely;

(ii) with respect to the representations and warranties set forth in Sections 4. 16, 4.17 , 4.20 and 4.26 (the “ Company Statutory Representations and Warranties ”), 90 days following expiration of the relevant statute of limitations period;

(iii) with respect to all other representations and warranties contained in Sections 4 and 5 and not addressed in (i) or (ii) above, three years following the Closing;

(iv) with respect to the obligations set forth in Section 9.2 , indefinitely; and

(v) the covenants, agreements and other obligations contained in this Agreement, and the indemnification obligations of the parties with respect thereto, shall survive until performed in accordance with their terms or become no longer applicable.

(b) No Indemnitor shall be liable for any Damages with respect to the matters set forth in Section 8.1 unless a claim is timely asserted prior to the expiration of the survival period specified in this Section 8.2 ; provided , however , if a notice of a claim is timely given prior to the expiration of the survival period specified in this Section 8.2 then such indemnification obligation shall continue to survive past expiration of such survival period until such claim has been satisfied or otherwise resolved as provided in Section 8.1 .

8.3 Use of Proceeds . The Investor acknowledges that the Company intends to distribute all proceeds from the issuance and sale of the Securities to the Company’s members (as of immediately prior to the Closing) in accordance with the Restated Operating Agreement.

8.4 Other Agreements and Covenants .

(a) The Company shall not, without the prior written consent of the Investor, (i) use in advertising, publicity, or otherwise the name of the Investor, Goldman, Sachs & Co., or any or their Affiliates, or any partner or employee of any of them, nor any trade name, trademark, trade device, service mark, symbol, or any abbreviation, contraction, or simulation thereof owned by the Investor, Goldman, Sachs & Co., or any of their Affiliates, or (ii) represent, directly or indirectly, that any product or any service provided by the Company has been approved or endorsed by the Investor, Goldman, Sachs & Co., or any of their Affiliates.

(b) The Company hereby grants the Investor, Goldman, Sachs & Co., and their Affiliates permission to use the Company’s name and logo in the Investor’s, Goldman, Sachs & Co.’s, or their Affiliates’ marketing materials. The Investor, Goldman, Sachs & Co., or

their Affiliates, as applicable, shall include a trademark attribution notice giving notice of the Company’s ownership of its trademarks in the marketing materials in which the Company’s name and logo appear.

8.5 Tax Matters . The Company and its members as of the Closing Date shall be liable for, and shall indemnify, defend, and hold harmless the Investor for, any and all liability for Taxes with respect to the Company, its Subsidiaries, and the ownership or operation of their assets for any taxable period ending on or before the Closing Date and with respect to any taxable period that begins on or before and ends after the Closing Date (“ Straddle Period ”), for the portion thereof ending at the close of business on the Closing Date. In the case of any Straddle Period, liability for income Taxes relating to the Company, its Subsidiaries, or the ownership or operation of their assets shall be allocated as if all of the books and records relating to the Company, its Subsidiaries, and the ownership and operation of their assets were closed as of the close of business on the Closing Date. In the case of any Straddle Period, the amount of any Taxes other than income Taxes allocable to the portion of the Straddle Period ending on the Closing Date shall be deemed to be the amount of such Taxes for the entire period (or, in the case of such Taxes determined on an arrears basis, the amount of such Taxes for the immediately preceding period) multiplied by a fraction, the numerator of which is the number of calendar days in the applicable period ending on and including the Closing Date and the denominator of which is the number of calendar days in the entire relevant period. In the case of ad valorem property Taxes, “taxable period” means the period beginning on the assessment date for ad valorem property Taxes through the day before the next assessment date for such Taxes.

Section 9. GENERAL PROVISIONS.

9.1 Disclosure Schedule . Any information set forth in the Disclosure Schedule will be deemed to be disclosed for purposes of Section 4 only to the extent that such information is expressly identified by a specific reference to the subsection of Section 4 to which it applies.

9.2 Confidentiality .

(a) The parties shall maintain the terms of this Agreement in confidence and shall not disclose any information concerning the terms, performance, or administration of this Agreement to any other Person; provided that a party may disclose such information: (i) to any of such party’s Group, (ii) to any prospective member of such party’s Group, (iii) to any actual or prospective purchaser of all or a portion of such party’s interest in either of the Facilities or any facility leased pursuant to the Exclusive Right to Lease, and (iv) to any Person providing or evaluating a proposal to provide financing to the recipient party or any direct or indirect owner of such party; provided in each case that the recipient party shall provide to each Person to which disclosure is made a copy of this Section 9.2 and direct such Person to treat such information confidentially, and the recipient party shall be liable for any breach of the terms of this Section 9.2 by such Persons to which it makes any such disclosure. The foregoing restrictions will not apply (A) to information that is or becomes generally available to the public otherwise than as a result of disclosure by the recipient party, (B) to information that is already in, or subsequently comes into, the recipient party’s possession, provided that the source of such information was not, to the recipient party’s knowledge, obligated to keep such information

confidential, (C) to information that is required to be disclosed pursuant to Legal Requirements or stock exchange rules and regulations or is otherwise subject to legal, judicial, regulatory, or self-regulatory requests for information or documents, or (D) subject to Section 9.2(b) below, to the Tax structure or Tax treatment of the transaction.

(b) Each party may disclose to any and all Persons, without limitation of any kind, the Tax treatment and Tax structure of the transaction, provided , however , that any such information is required to be kept confidential to the extent necessary to comply with any applicable securities laws. The Tax structure and Tax treatment of the transaction includes only those facts that may be relevant to understanding the purported or claimed U.S. federal and state income Tax treatment or Tax structure of the transaction and, to eliminate any doubt, therefore specifically does not include information that either reveals or standing alone or in the aggregate with other information so disclosed tends of itself to reveal or allow the recipient of the information to ascertain the identity of any parties involved in any of the transactions contemplated by this Agreement or the documents to be delivered in connection herewith.

(c) If any party is required to disclose any information required by this Section 9.2 to be maintained as confidential in a judicial, administrative, or governmental proceeding, such party shall give the other party at least ten days’ prior written notice (unless less time is permitted by the applicable proceeding) before disclosing any such information in any said proceeding and, in making such disclosure, the party required to disclose the information shall disclose only that portion thereof required to be disclosed and shall cooperate with the other party in the other party’s attempts to seek to preserve the confidentiality thereof, including if such party seeks to obtain protective orders and/or any intervention.

(d) The parties hereto agree that irreparable damage would occur in the event that this Section 9.2 was breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Section 9.2 and to enforce specifically the terms and provisions of this Section 9.2 .

9.3 Binding Effect; Third Parties . This Agreement shall be binding upon and, except as provided below, inure solely to the benefit of each party and its successors and permitted assigns (including transferees of any Securities in accordance with applicable law, the terms of this Agreement and the terms of the Restated Operating Agreement), and nothing in this Agreement, express or implied, is intended to confer upon any other Person any rights or remedies of any nature whatsoever under or by reason of this Agreement, except as expressly provided in Section 8 or otherwise in this Agreement.

9.4 Governing Law . THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF, INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW. THE PARTIES HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT IN THE COUNTY OF NEW YORK IN THE STATE OF NEW YORK WITH RESPECT TO ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND CONSENT TO THE SERVICE OF PROCESS IN ANY MANNER PERMITTED BY LAW.

EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING RELATING TO A DISPUTE AND FOR ANY COUNTERCLAIM WITH RESPECT THERETO ARISING OUT OF OR RELATING TO THIS AGREEMENT.

9.5 Counterparts . This Agreement may be executed and delivered (including by facsimile or electronic mail transmission) in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart.

9.6 Headings; Construction . The headings and captions used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. All references in this Agreement to sections, paragraphs, exhibits, and schedules shall, unless otherwise provided, refer to sections and paragraphs of this Agreement and exhibits and schedules attached to this Agreement, all of which exhibits and schedules are incorporated in this Agreement by this reference. The words “this Agreement,” “herein,” “hereby,” “hereunder,” and “hereof” and words of similar import, refer to this Agreement as a whole and not to any particular subdivision unless expressly so limited. The words “this section,” “this subsection,” and words of similar import refer only to the sections or subsections hereof in which such words occur. The word “including” (in its various forms) means “including, without limitation.” Pronouns in masculine, feminine, or neuter genders will be construed to state and include any other gender, and words, terms, and titles (including terms defined herein) in the singular form will be construed to include the plural and vice versa, unless the context otherwise expressly requires. Unless the context otherwise requires, all defined terms contained herein will include the singular and plural and the conjunctive and disjunctive forms of such defined terms.

9.7 Notices . All notices, requests, consents, and other communications required or permitted under this Agreement must be in writing and will be deemed given if delivered personally, by a nationally recognized overnight courier, by facsimile or electronic mail, or mailed by registered or certified mail (return receipt requested) to the parties at the following addresses (or at such other address for a party as shall be specified by like notice):

If to the Investor, to :

GSFS Investments I Corp.

c/o Goldman Sachs & Co.

200 West Street

New York, New York 10282

Attention: Michael Feldman

Fax: (212) 428-3868

Email address: mfeldman@gs.com

With a copy (which shall not constitute notice) to :

Vinson & Elkins L.L.P.

1001 Fannin Street, Suite 2500

Houston, Texas 77002-6760

Attention: F. B Cochran III

Fax: (713) 615-5368

Email address: fcochran@velaw.com

If to the Company, to :

Clean Coal Solutions, LLC

8100 SouthPark Drive, Unit B

Littleton, CO 80120

Attn: Mark McKinnies

Fax: (303) 734-0330

Email address: markm@adaes.com

With copies (which shall not constitute notice) to :

NexGen Refined Coal, LLC

3300 South Parker Road, Suite 310

Aurora, CO 80014

Attn: Charles S. McNeil, President

Fax: (303) 751-9210

Email address: cmcneil@nexgen-group.com

and

Hogan Lovells US LLP

One Tabor Center, Suite 1500

1200 Seventeenth Street

Denver, CO 80202

Attention: Tyler Harvey

Facsimile No.: (303) 454-2436

E-mail address: tyler.harvey@hoganlovells.com

9.8 Expenses and Obligations . Except as otherwise expressly provided in this Agreement, all costs and expenses incurred by the parties in connection with this Agreement and the consummation of the transactions contemplated hereby shall be borne solely and entirely by the party that has incurred such costs and expenses.

9.9 Amendment, Modification, and Waiver . This Agreement may not be amended or modified except by an instrument in writing signed by each of the parties. Any failure of any party to comply with any obligation, covenant, agreement, or condition contained herein may be waived only if set forth in an instrument in writing signed by the party to be

bound thereby, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement, or condition shall not operate as a waiver of, or estoppel with respect to, any other failure.

9.10 Severability . If any term or other provision of this Agreement is invalid, illegal, or incapable of being enforced by any rule of applicable Legal Requirements, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated herein are not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated herein are consummated as originally contemplated to the fullest extent possible.

9.11 Entire Agreement . This Agreement, together with all exhibits and schedules to this Agreement, shall constitute the entire agreement between the parties hereto relating to the subject matter hereof. No modification of this Agreement or waiver of any provision hereof shall be binding unless the modification or waiver shall be in writing and signed by the parties hereto. This Agreement expressly supersedes all prior agreements between the parties relating to the subject matter hereof, including the Term Sheet.

9.12 Further Acts . In addition to the acts recited in this Agreement to be performed by the Company and the Investor, the Company and the Investor agree to perform or cause to be performed at the Closing or after the Closing any and all such further acts as may be reasonably necessary to consummate the transactions contemplated hereby.

9.13 Delays or Omissions . No delay or omission to exercise any right, power, or remedy accruing to a upon any breach or default of the other party under this Agreement shall impair any such right, power, or remedy of the party not in breach or default; nor shall it be construed to be a waiver of any such breach or default or an acquiescence in such breach or default or of any similar breach or default occurring after such breach or default; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default occurring before or after such breach or default. Any waiver, permit, consent, or approval of any kind or character on the part of any party of any breach or default under this Agreement or any waiver on the part of any party of any provisions or conditions of this Agreement must be made in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any party, shall be cumulative and not alternative.

9.14 Assignment . The Investor may not assign all or any part of this Agreement without the prior written consent of the Company, provided the Investor may assign this Agreement to any Affiliate without such prior written consent. The Company may not assign all or any part of this Agreement without the prior written consent of the Investor. The Investor shall immediately notify the Company of any assignment of this Agreement.

9.15 No Commitment for Additional Financing . The Company acknowledges and agrees that the Investor has not made any representation, warranty, covenant,

or agreement to provide or assist the Company in obtaining any financing, investment, or other assistance, other than the purchase of the Securities as set forth in Section 2.2 (but subject to the conditions set forth in Section 6 ). In addition, the Company acknowledges and agrees that an obligation, commitment, or agreement to provide or assist the Company in obtaining any financing or investment may be created only by a written agreement signed by the Investor and the Company setting forth the terms and conditions of such financing or investment and stating that the parties intend for such writing to be a binding obligation or agreement. The Investor shall have the right, in its sole and absolute discretion, to refuse or decline to participate in any other financing of or investment in the Company, and shall have no obligation to assist or cooperate with the Company in obtaining any financing, investment, or other assistance.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties to this Agreement have executed this Agreement as of the date first written above.

S IGNATURE P AGE T O

C LASS B U NIT P URCHASE A GREEMENT

CLASS B UNIT PURCHASE AGREEMENT

LIST OF EXHIBITS



Exhibit A	—	Definitions

Exhibit B	—	Restated Operating Agreement

Exhibit C	—	Investor Schedule

Exhibit D	—	Opinion of Company Counsel

Exhibit E	—	Exclusive Right to Lease Agreement

Exhibit F	—	Form of Guarantee

List of Exhibits

EXHIBIT A

DEFINITIONS

As used in this Agreement, the following terms have the following meanings:

“ 2010 Balance Sheet ” has the meaning set forth in Section 4.6(a) .

“ Action ” means any action, suit, proceeding, claim, arbitration, or investigation.

“ ADA ” means ADA-ES, Inc., a Colorado corporation.

“ AEC-NM ” means AEC-NM, LLC, a Colorado limited liability company and a Subsidiary of the Company.

“ AEC-TH ” means AEC-TH, LLC, a Colorado limited liability company and a Subsidiary of the Company.

“ Affiliate ” means, with respect to any Person, any other Person controlling, controlled by, or under common control with such Person. For purposes of this definition and this Agreement, the term “ control ” (and correlative terms) means (a) the ownership of 50% or more of the equity interest in a Person or (b) the power, whether by Contract, equity ownership, or otherwise, to direct or cause the direction of the policies or management of a Person. For the purposes of this definition, each of ADA, NexGen, NexGen Investments, LLLP, and Republic Financial Corporation are Affiliates of the Company. For the purposes of this definition, any member of the federal income tax consolidated group of which the Investor is a member is an Affiliate of the Investor.

“ Agreement ” has the meaning set forth in the preamble hereto.

“ Audited Financial Statements ” has the meaning set forth in Section 4.6(a) .

“ Claim ” means a demand, claim, complaint, cross-demand, cross-claim, counterclaim, cross-complaint, summons, notice of violation, arbitration notice, or other notice, communication, or action pursuant to which a Person (including a Governmental Body) (a) notifies another Person that the first Person has suffered or incurred Losses for which the second Person may be liable or responsible; (b) alleges that such second Person has violated a Legal Requirement or is otherwise liable or responsible for Losses arising under a Legal Requirement; (c) asserts legal, equitable, contractual, or other rights or remedies against such second Person; (d) proposes an adjustment to a Tax Return of such second Person; (e) institutes or commences a Proceeding against such second Person; (f) otherwise makes any demand or claim on such second Person; or (g) threatens to do any of the foregoing.

“ Claim Notice ” has the meaning set forth in Section 8.1(d) .

“ Class A Units ” has the meaning given to it in the Restated Operating Agreement.

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“ Class B Units ” has the meaning given to it in the Restated Operating Agreement.

“ Closing ” has the meaning set forth in Section 3 .

“ Closing Date ” means the date on which the Closing occurs.

“ Code ” means the Internal Revenue Code of 1986, as amended.

“ Company ” has the meaning set forth in the preamble hereto.

“ Company Benefit Plans ” has the meaning set forth in Section 4.16 .

“ Company Fundamental Representations and Warranties ” has the meaning set forth in Section 8.2(a)(i) .

“ Company Indemnified Party ” and “ Company Indemnified Parties ” have the meanings set forth in Section 8.1(b) .

“ Company’s Knowledge ” means, with respect to any matter in question, the knowledge that any director, manager, or officer of the Company or any of its Subsidiaries after due inquiry and investigation; provided, however, that due inquiry and investigation shall not require the Company or any of its Subsidiaries to conduct environmental sampling.

“ Company Statutory Representations and Warranties ” has the meaning set forth in Section 8.2(a)(ii) .

“ Contract ” means any written contract, commitment, agreement, instrument, arrangement, understanding, obligation, undertaking, concession, franchise, or license.

“ Controlled Entity ” means any Subsidiary of the Company or any trade or business (whether or not incorporated) that is under common control or that is treated as a single employer with the Company under Section 414(b), (c), (m), or (o) of the Code.

“ Deductible ” has the meaning set forth in Section 8.1(c)(i) .

“ Direct Claim Notice ” has the meaning set forth in Section 8.1(i) .

“ Disclosure Schedule ” has the meaning set forth in Section 4 .

“ Environmental Claim ” means any Claim asserted pursuant to any Environmental Law.

“ Environmental Laws ” means all applicable Legal Requirements and rules of common law pertaining to the protection of the environment, natural resources, workplace health and safety with respect to exposure to Hazardous Substances, the prevention of pollution, or the remediation of contamination, including the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. § 9601 et seq.), the Emergency Planning and

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Community Right to Know Act and the Superfund Amendments and Reauthorization Act of 1986, the Solid Waste Disposal Act (42 U.S.C. § 6901 et seq.), the Resource Conservation and Recovery Act of 1976, the Hazardous and Solid Waste Amendments Act of 1984, the Clean Air Act (42 U.S.C. § 7401 et seq.), the Clean Water Act (33 U.S.C. § 1251 et seq.), the Federal Water Pollution Control Act, the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Safe Drinking Water Act, the Occupational Safety and Health Act of 1970 (42 U.S.C. § 11001 et seq.), the Oil Pollution Act of 1990, the Hazardous Materials Transportation Act (49 U.S.C. § 1801 et seq.) the Federal Mine Safety and Health Act of 1977 (30 U.S.C. § 801 et seq.), and any similar or analogous statutes, regulations, and decisional law of any Governmental Body, as each of the foregoing have been amended or supplemented, in each case to the extent applicable with respect to the property or operation to which application of the term “ Environmental Laws ” relates.

“ Environmental Loss ” or “ Environmental Losses ” means losses, lost Section 45 Credits (but only to the extent such Section 45 Credits relate to Refined Coal actually produced by the Facilities), liabilities, causes of action, assessments, cleanup, removal, remediation, and restoration obligations, judgments, awards, damages, natural resource damages, contribution, costrecovery, and compensation obligations, fines, fees, penalties, and costs and expenses (including litigation costs and reasonable attorneys’ and experts’ fees and expenses).

“ Environmental Permit ” means any Governmental Authorization required under or issued pursuant to any applicable Environmental Law.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended.

“ ERISA Pension Plan ” has the meaning set forth in Section 4.16(c) .

“ Exclusive Right to Lease ” means the Exclusive Right to Lease Agreement between the Investor and the Company substantially in the form attached to this Agreement as Exhibit E .

“ Existing Operating Agreement ” has the meaning set forth in Section 2.1 .

“ Existing Sites ” means the land at the power plants known as the New Madrid Power Plant and the Thomas Hill Energy Center located near Marston, Missouri and Moberly, Missouri, respectively, where the Facilities are presently located.

“ Facilities ” means the New Madrid Refined Coal Facility and the Thomas Hill Refined Coal Facility.

“ Family Member ” means any relative or spouse of such person or any relative of such spouse, any one of whom has the same home as such person.

“ Financial Statements ” has the meaning set forth in Section 4.6(a) .

“ GAAP ” has the meaning set forth in Section 4.6(b) .

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“ Governmental Authorization ” means any approval, consent, license, permit, registration, exemption, exception, variance, waiver, or other authorization issued, granted, given, or otherwise made available by or under the authority of any Governmental Body or pursuant to any Legal Requirement.

“ Governmental Body ” means any (a) nation, state, county, city, town, village, district, or other jurisdiction of any nature, (b) federal, state, local, municipal, foreign, or other government, (c) governmental or quasi governmental authority of any nature (including any governmental agency, branch, department, official, or entity), and any other court or other tribunal, (d) multi-national organization or body, or (e) body exercising, or entitled to exercise, any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature.

“ Group ” means, with respect to any party to this Agreement, such party and (a) the Affiliates of such party; (b) each guarantor of such party; (c) any other members, shareholders, partners, or other equity owners of such party or any of its Affiliates (other than holders of publicly traded units of such party or of any of its Affiliates, except any such holder that controls such party), and (d) the respective successors, assigns, and Representatives of each Person described in the foregoing clause (a), (b), or (c), but shall in no event include the other parties’ respective Groups.

“ Guarantee ” means the Guarantee of each of ADA and NexGen in the form attached to this Agreement as Exhibit F .

“ Hazardous Substances ” means (a) any hazardous materials, hazardous wastes, hazardous substances, toxic wastes, and toxic substances as those or similar terms are defined under any Environmental Laws; (b) any asbestos or any material which contains any hydrated mineral silicate, including chrysolite, amosite, crocidolite, tremolite, anthophylite, and/or actinolite, whether friable or non-friable; (c) polychlorinated biphenyls (“ PCBs ”), or PCB-containing materials, or fluids; (d) radon; (e) any other hazardous, radioactive, toxic or noxious substance, material, pollutant, contaminant, or constituent; (f) any petroleum, petroleum hydrocarbons, petroleum products, crude oil and any fractions or derivatives thereof, and any natural gas, synthetic gas and any mixtures thereof; and (g) any substance that, whether by its nature or its use, is subject to regulation under any Environmental Laws or with respect to which any Environmental Laws or Governmental Body requires environmental investigation, monitoring, or remediation.

“ Indemnitee ” has the meaning set forth in Section 8.1(d) .

“ Indemnitor ” has the meaning set forth in Section 8.1(d) .

“ Intellectual Property Rights ” has the meaning set forth in Section 4.11(a) .

“ Investor ” has the meaning set forth in the preamble hereto.

“ Investor Fundamental Representations and Warranties ” has the meaning set forth in Section 8.2(a)(i) .

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“ Investor Indemnified Party ” and “ Investor Indemnified Parties ” have the meanings set forth in Section 8.1(a) .

“ Leased Real Property ” has the meaning set forth in Section 4.15 .

“ Legal Requirement ” means any federal, state, local, municipal, foreign, international, multi-national, or other administrative order, constitution, law, decree, rule, ordinance, principle of common law, regulation, statute, or treaty.

“ Lien ” means any mortgage, pledge, claim, lien, charge, encumbrance, or security interest of any kind or nature whatsoever, but shall not include (i) Liens for taxes arising or incurred in the ordinary course of the Company’s business not yet due or payable or the validity of which are being contested in good faith by appropriate proceedings and, in either case, for which adequate reserves are reflected on the Balance Sheet to the extent required by GAAP, (ii) purchase money liens or liens on property securing the lease of such property, or (iii) mechanics’, workmen’s, repairmen’s, warehousemen’s, processor’s, landlord’s, carrier’s, materialmen’s or other statutory Liens, each arising or incurred in the ordinary course of the Company’s business for sums not yet due and payable and that would not individually or in the aggregate be materially adverse to the affected property or the business of the Person subject to such Lien.

“ Losses ” means any losses, claims, damages, liabilities, obligations, fines, penalties, judgments, settlements, costs, expenses, and disbursements (including reasonable attorneys’ fees and expenses), but excluding any special, consequential, exemplary or punitive damages, unless such damages are paid by an Indemnitee to a third party in connection with a Third Party Claim.

“ Material Adverse Effect ” means any state of facts, change, effect, condition, development, event, or occurrence that has been, is, or could reasonably be expected to be material and adverse to the (a) condition (financial or other), (b) business, (c) results of operations, (d) assets, (e) liabilities, or (f) operations of the Company and its Subsidiaries, taken as a whole, or the ability of the Company and its Subsidiaries to consummate the transactions contemplated by this Agreement (it being understood that for purposes of analyzing whether any state of facts, change, effect, condition, development, event, or occurrence constitutes a “Material Adverse Effect” under this definition, the parties agree that (x) the Investor shall be deemed not to have any knowledge of any state of facts, change, effect, condition, development, event, or occurrence, (y) the analysis of materiality shall not be limited to a long-term perspective, and (z) each of the terms contained in (a) through (f) above are intended to be separate and distinct), provided, however, that neither of the following shall be deemed in themselves to constitute, and neither of the following shall be taken into account in determining whether there has been or will be, a Material Adverse Effect: (A) general worldwide or national economic conditions or changes thereto, and (B) changes in economic, regulatory or other conditions that effect the coal or utility industries generally.

“ Material Contracts ” has the meaning set forth in Section 4.18(a) .

“ Multiemployer Plan ” has the meaning set forth in Section 4.16(d) .

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“ Multiple Employer Plan ” has the meaning set forth in Section 4.16(d) .

“ New Madrid Refined Coal Facility ” means the Refined Coal production facility currently located at the New Madrid Power Plant near Marston, Missouri or at any successor location, and used for the production of Refined Coal. For the avoidance of doubt, the “New Madrid Refined Coal Facility” does not include any real property.

“ NexGen ” means NexGen Refined Coal, LLC, a Wyoming limited liability company.

“ Notice Period ” has the meaning set forth in Section 8.1(d) .

“ Order ” means any award, decision, decree, judgment, order, writ, ruling, stipulation, subpoena, injunction, legally binding agreement with, or verdict entered, issued, made, or rendered by, any court, administrative agency, or other Governmental Body or by an arbitrator.

“ Person ” means a natural person, corporation, partnership, limited liability company, joint venture, estate, association, trust, Governmental Body, unincorporated organization, or other entity.

“ Proceeding ” means a judicial, administrative, or arbitral proceeding (including a lawsuit or an investigation by a Governmental Body), commencing with the institution of such proceeding through the issuance, service, or delivery of the applicable Claim or other applicable event.

“ Proprietary Assets ” has the meaning set forth in Section 4.11(a) .

“ Purchase Price ” has the meaning set forth in Section 2.2 .

“ Refined Coal ” means a liquid, gaseous, or solid fuel produced from coal by the Facilities that produces, upon sale to an Unrelated Person, a Section 45 Credit.

“ Related Party ” means any member, manager, officer, consultant, or employee of the Company or any of its Subsidiaries, or any Affiliate or Family Member of any of the foregoing.

“ Release ” means any depositing, spilling, leaking, pumping, pouring, placing, emitting, discarding, abandoning, emptying, discharging, migrating, injecting, escaping, leaching, dumping, or disposing into or onto the environment.

“ Restated Operating Agreement ” has the meaning set forth in Section 2.1 .

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“ Scheduled Governmental Authorizations ” has the meaning set forth in Section 4.12 .

“ Securities ” has the meaning set forth in Section 2.2 .

“ Securities Act ” means the Securities Act of 1933, as amended.

“ Section 45 Credit ” means the credit allowed by Section 45 of the Code for the production and sale of refined coal produced from coal.

“ Straddle Period ” has the meaning set forth in Section 8.5 .

“ Subsidiary ” of any Person means any other Person (a) more than 50% of whose outstanding shares or securities representing the right to vote for the election of directors or other managing authority of such other Person are, now or hereafter, owned or controlled, directly or indirectly, by such first Person, but such other Person shall be deemed to be a Subsidiary only so long as such ownership or control exists, or (b) which does not have outstanding shares or securities with such right to vote, as may be the case in a partnership, joint venture or unincorporated association, but more than 50% of whose ownership interest representing the right to make the decisions for such other Person is, now or hereafter, owned or controlled, directly or indirectly, by such first Person, but such other Person shall be deemed to be a Subsidiary only so long as such ownership or control exists. For the avoidance of doubt, Clean Coal Solutions Services, LLC, a Colorado limited liability company, is not, and shall not be considered for any purposes of this Agreement, a Subsidiary of the Company.

“ Tax ” or “ Taxes ” means (a) any taxes, assessments, fees, unclaimed property and escheat obligations, and other governmental charges imposed by any governmental authority, including income, profits, gross receipts, net proceeds, alternative or add on minimum, ad valorem, value added, turnover, sales, use, property, personal property (tangible and intangible), environmental, stamp, leasing, lease, user, excise, duty, franchise, capital stock, transfer, registration, license, withholding, social security (or similar), unemployment, disability, payroll, employment, social contributions, fuel, excess profits, occupational, premium, windfall profit, severance, estimated, or other charge of any kind whatsoever, including any interest, penalty, or addition thereto, whether disputed or not; (b) any liability for the payment of any amounts of the type described in clause (a) of this definition as a result of being a member of an affiliated group filing a consolidated U.S. federal income Tax Return or having any liability for Taxes of any Person under Section 1.1502-6 of the United States Treasury Regulations (or any similar provision of state, local, or foreign law); and (c) any liability of for the payment of any amounts of the type described in clauses (a) or (b) of this definition as a result of the operation of law or any express or implied obligation to indemnify any other Person.

“ Tax Return ” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

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“ Term Sheet ” means that certain indicative term sheet, dated as of May 4, 2011, by and between the Company and Goldman, Sachs & Co. and the side letter thereto dated May 10, 2011.

“ Third Party Claim ” has the meaning set forth in Section 8.1(d) .

“ Thomas Hill Refined Coal Facility ” means the Refined Coal production facility currently located at the Thomas Hill Energy Center near Moberly, Missouri or at any successor location, and used for the production of Refined Coal. For the avoidance of doubt, the “Thomas Hill Refined Coal Facility ” does not include any real property.

“ Transaction Agreements ” means this Agreement, the Restated Operating Agreement, the Exclusive Right to Lease, and the Guarantees.

“ Unaudited Interim Financial Statements ” has the meaning set forth in Section 4.6(a) .

“ Units ” (i) when referencing a time prior to the Closing, has the meaning given to it in the Existing Operating Agreement, and (ii) when referencing a time following Closing, has the meaning given to it in the Restated Operating Agreement.

“ Unrelated Person ” means, with respect to any Person, any other Person that is no related to such Person within the meaning of Section 45(e)(4) of the Code.

A-48

EXHIBIT B

RESTATED OPERATING AGREEMENT

Filed as Exhibit 10.33 to this Report on Form 10-Q

EXHIBIT C

INVESTOR SCHEDULE


Investor:	Number of Class B Units	Total Purchase Price

Name: GSFS Investments I Corp. Address: 200 West Street New York, New York 10282	15 15/19	$60,000,000.00

Total	15 15/19	$60,000,000.00

EXHIBIT D

OPINION OF COMPANY COUNSEL

EXHIBIT E

EXCLUSIVE RIGHT TO LEASE AGREEMENT

Filed as Exhibit 10.84 to this Report on Form 10-Q

EXHIBIT F

FORM OF GUARANTEE

[See Attached]

LIMITED GUARANTEE

LIMITED GUARANTEE (this “ Guarantee ”), dated as of May __, 2011, by [GUARANTOR], a (the “ Guarantor ”), in favor of GSFS Investments I Corp., a Delaware corporation (the “ Guaranteed Party ”). The Guarantor and the Guaranteed Party may hereinafter be referred to individually as a “ Party ” or collectively as the “ Parties ”.

PRELIMINARY STATEMENTS

A. Guarantor is a member of Clean Coal Solutions, LLC, a Colorado limited liability company (the “ Company ”).

B. The Company and the Guarantor desire to have the Guaranteed Party enter into certain Transaction Documents (as defined below) with, among others, the Company and/or the Guarantor.

C. The Guaranteed Party is willing to enter into the Transaction Documents with the Company and/or the Guarantor on the condition, among others, that all of the Company’s indemnification obligations under Section 8.1(a) of the Class B Unit Purchase Agreement, dated as of the date hereof (the “ Purchase Agreement ”), between the Company and the Guaranteed Party are guaranteed by the Guarantor, on the terms set forth in this Guarantee.

NOW, THEREFORE, in consideration of the premises and in order to induce the Guaranteed Party to enter into the Transaction Documents, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Guarantor hereby agrees as follows:

1. Definitions .

1.1 Defined Terms . As used in this Guarantee, (i) the capitalized terms defined in the preamble, preliminary statements and other sections of this Guarantee shall have the respective meanings specified therein; (ii) capitalized terms used but not defined in this Guarantee shall have the meanings given to such terms in the Purchase Agreement; and (iii) the following terms shall have the following meanings:

“ Obligations ” shall mean solely, without duplication, all of the Company’s obligations to indemnify, defend and hold harmless the Investor Indemnified Parties (under and as defined in the Purchase Agreement) set forth in section 8.1(a) of the Purchase Agreement. The term “Obligations” shall not include any other obligation of the Company, any Affiliate or Subsidiary of the Company or any Member of the Company that may arise under any of the Transaction Documents or otherwise.

“ Transaction Documents ” shall mean the Purchase Agreement, the Second Amended and Restated Operating Agreement of the Company, dated as of the date hereof, and the Exclusive Right to Lease Agreement, dated as of the date hereof, between the Company and the Guaranteed Party.

1.2 Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be modified by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument of other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified in accordance with the provisions hereof and thereof; (b) any reference herein to any “Person” shall mean a natural person, corporation, partnership, limited liability company, joint venture, estate, association, trust, governmental body, unincorporated organization or other entity and shall be construed to include such Person’s successors and permitted assigns; and (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Guarantee in its entirety and not to any particular provision of this Guarantee. Article and section headings used herein are for convenience of reference only, are not part of this Guarantee and shall not affect the construction of, or be taken into consideration in interpreting, this Guarantee.

2. Guarantee .

2.1 Irrevocable Guarantee .

(a) The Guarantor hereby unconditionally and irrevocably guarantees, as a primary obligor and not merely as a surety, to the Guaranteed Party and its successors, permitted indorsees, permitted transferees and permitted assigns that, upon written demand of payment made by the Guaranteed Party to the Guarantor, all Obligations will be promptly paid in full, in United States dollars, when due in accordance with the terms of the Purchase Agreement (after giving effect to the rights, limitations and obligations set forth in sections 8.1(c)-(j) and 8.2 of the Purchase Agreement).

(b) If legal action is instituted to enforce the rights of the Guaranteed Party under this Guarantee, the Guarantor agrees to reimburse the Guaranteed Party on written demand for all reasonable attorney’s fees and disbursements and all other reasonable costs and expenses incurred by the Guaranteed Party in successfully enforcing its rights under this Guarantee. Notwithstanding the foregoing, the Guarantor shall have no obligation to pay any such costs or expenses if, in any action or proceeding brought by the Guaranteed Party giving rise to a demand for payment of such costs or expenses, it is finally adjudicated by a court of competent jurisdiction that the Guarantor is not liable to make payment under Section 2.1(a) with respect to the rights of the Guaranteed Party sought to be enforced in such action or proceeding.

(c) Each payment under this Guarantee shall be made in United States dollars. Notwithstanding anything in this Section 2.1 , the Guarantor’s liability to guarantee any Obligations shall not exceed the liability of the Company with respect to its Obligations under the terms of the Purchase Agreement; provided, that, notwithstanding the foregoing provisions of this paragraph (c), or any other provisions hereof to the contrary, (i) the Guarantor’s liability for the Obligations shall not be reduced by the amount of any costs and

expenses recovered or recoverable by the Guaranteed Party under Section 2.1(b) , and (ii) if the Company’s liability in respect of the Obligations is reduced due to any defense described in clauses (1) through (3) of the final paragraph of Section 2.3 hereof, the amount of such reduction shall not reduce the Guarantor’s liability for such Obligations hereunder.

2.2 No Subrogation . The Guarantor will not exercise any rights that it may acquire by way of subrogation or a right of contribution from the Company under this Guarantee, by any payment made hereunder or otherwise, until all of the Obligations owing by the Company, if any, shall have been indefeasibly paid in full. If any amount shall be paid to the Guarantor on account of such subrogation or contribution rights at any time when all of the Obligations owing by the Company shall not have been paid in full, such amount shall be held in trust for the benefit of the Guaranteed Party to whom such Obligations are payable and shall forthwith be paid to the Guaranteed Party to be credited and applied to such Obligations, whether matured or unmatured, in accordance with section 8.1 of the Purchase Agreement. If (i) the Guarantor shall make payment to the Guaranteed Party of all or any part of the Obligations and (ii) all of the Obligations shall be indefeasibly paid in full, the Guaranteed Party will, at the Guarantor’s request and expense, execute and deliver to the Guarantor appropriate documents in form and substance reasonably satisfactory to the Guaranteed Party, without recourse and without representation or warranty, necessary to evidence the transfer by subrogation to the Guarantor of an interest in the Obligations resulting from such payment by the Guarantor.

2.3 No Effect on Guarantee . The obligations of the Guarantor under this Guarantee shall not be altered, limited, impaired or otherwise affected by:

(a) any rescission of any demand for payment of any of the Obligations or any failure by the Guaranteed Party to make any such demand on the Company or any other guarantor or to collect any payments from the Company or any other guarantor or any release of the Company or any other guarantor;

(b) any renewal, extension, modification, amendment, acceleration, compromise, waiver, indulgence, rescission, discharge, surrender or release, in whole or in part, or any assignment or transfer, of the Purchase Agreement or the Obligations or any other instrument or agreement evidencing, relating to, securing or guaranteeing any of the Obligations, or the liability of any party to any of the foregoing or for any part thereof;

(c) any act or omission of the Guaranteed Party relating in any way to the Obligations or to the Company, including any failure to bring an action against any party liable on the Obligations, or any party liable on any other guarantee of the Obligations;

(d) any proceeding, voluntary or involuntary, involving bankruptcy, insolvency, receivership, reorganization, liquidation or arrangement of the Company or any other guarantor or any defense which the Company or any other guarantor may have by reason of the order, decree or decision of any court or administrative body resulting from any such proceeding; and

(e) any other act or omission that may or might in any manner or to any extent vary the risk of the Guarantor or that may or might otherwise operate as a discharge of the Guarantor as a matter of law or equity, other than (i) the indefeasible payment in full in United States dollars of all the Obligations, and (ii) as set forth in the next paragraph.

Notwithstanding the foregoing, the Guarantor shall be entitled to assert any defense which the Company may have under the Purchase Agreement to payment of any of its Obligations, other than defenses based upon (i) lack of authority, capacity, legal right or power of the Company to enter into and/or perform its Obligations, (ii) any insolvency, bankruptcy, reorganization, arrangement, composition, liquidation, dissolution or similar proceeding with respect to the Company, or (iii) the nonexistence, invalid formation, dissolution, merger or termination of the Company.

2.4 Continuing Guarantee; Termination . This Guarantee shall be construed as a continuing, absolute and unconditional guarantee of payment when due, and not of collection only, and the obligations of the Guarantor hereunder shall not be conditioned or contingent upon the pursuit by the Guaranteed Party at any time of any right or remedy against the Company or against any other Person which may be or become liable in respect of all or any part of the Obligations.

2.5 Reinstatement of Guarantee . This Guarantee shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Obligations is avoided, rescinded or must otherwise be restored or returned by the Guaranteed Party to the Company or its representative or to any other guarantor for any reason including as a result of any insolvency, bankruptcy or reorganization proceeding with respect to the Company or the Guarantor, all as though such payment had not been made.

2.6 No Consequential Damages . Notwithstanding anything in this Guarantee to the contrary, under no circumstances shall Guarantor be liable to the Guaranteed Party for special, consequential, exemplary or punitive damages with respect to any breach of this Guarantee, other than the payment of attorneys’ fees as is specifically provided for in this Guarantee.

3. Representations and Warranties of the Guarantor . The Guarantor hereby represents and warrants to the Guaranteed Party, as follows:

(a) The Guarantor is a [corporation / limited liability company], validly existing and in good standing under laws of the State of .

(b) The Guarantor has full power, authority and legal right to execute and deliver this Guarantee and to perform its obligations hereunder.

(c) The execution, delivery and performance of this Guarantee have been duly authorized by all necessary [corporate / limited liability company] action on the part of the Guarantor.

(d) This Guarantee has been duly executed and delivered by the Guarantor and constitutes the legal, valid and binding obligation of the Guarantor, enforceable against it in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency or other similar laws affecting creditors’ rights generally or by general principles of equity.

(e) All consents, authorizations, approvals and clearances (including any necessary exchange control approval) and notifications, reports and registrations requisite for its due execution, delivery and performance of this Guarantee have been obtained from or, as the case may be, filed with the relevant Governmental Bodies having jurisdiction and remain in full force and effect and all conditions thereof have been duly complied with and no other action by, and no notice to or filing with, any Governmental Body having jurisdiction is required for such execution, delivery or performance.

(f) The execution and delivery by the Guarantor of this Guarantee do not and the performance by Guarantor of its obligations hereunder will not, (i) violate or require any filing or notice under any law applicable to Guarantor (other than the filing of this Guarantee with the United States Securities and Exchange Commission under the federal securities laws applicable to U.S. public companies, if applicable), (ii) conflict with or cause a breach of any provision in the [certificate of incorporation / articles of organization], [by-laws / operating agreement] or other organizational document of Guarantor, or (iii) cause a breach of, constitute a default under, cause the acceleration of, create in any party the right to accelerate, terminate, modify or cancel, or require any authorization, consent, waiver or approval under any contract, license, instrument, decree, judgment or other arrangement to which Guarantor is a party or under which it is bound or to which any of its assets are subject (or result in the imposition of a Lien upon any such assets) except (in the case of this clause (iii)) for any that would not reasonably be expected to have a material adverse effect on Guarantor’s ability to perform its obligations under this Guarantee.

4. Election of Remedies . Each and every right, power and remedy herein given to the Guaranteed Party, or otherwise existing, shall be cumulative and not exclusive, and be in addition to all other rights, powers and remedies now or hereafter granted or otherwise existing. Each and every right, power and remedy whether specifically herein given or otherwise existing may be exercised, from time to time and as often and in such order as may be deemed expedient by the Guaranteed Party.

5. Effect of Delay or Omission to Pursue Remedy . No waiver by the Guaranteed Party of any right, power or remedy, or delay or omission by the Guaranteed Party in the exercise of any right, power or remedy which it may have shall impair any such right, power or remedy or operate as a waiver as to any other right, power or remedy then or thereafter existing. Any waiver given by the Guaranteed Party of any right, power or remedy in any one instance shall only be effective in that specific instance and only for the purpose for which given, and will not be construed as a waiver of any right, power or remedy on any future occasion.

Obligations, and any of them, shall conclusively be deemed to have been created, contracted, incurred, renewed, extended, amended or waived in reliance upon this Guarantee, and all dealings between the Guarantor and the Guaranteed Party shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guarantee. The Guarantor waives presentment, demand (other than demand delivered pursuant to Section 2.1(a) hereof), notice, and protest of all instruments included in or evidencing any of the Obligations and all other demands (other than any demand delivered pursuant to Section 2.1(a) hereof) and notices in connection with the delivery, acceptance, performance, default or enforcement of any such instrument or this Guarantee.

7. Amendment . This Guarantee may not be modified, amended, terminated or revoked, in whole or in part, except by an agreement in writing signed by the Guaranteed Party and the Guarantor. No waiver of any term, covenant or provision of this Guarantee, or consent given hereunder, shall be effective unless given in writing by the Guaranteed Party.

8. Notices . All notices and other communications under this Agreement shall be in writing and delivered (a) personally; (b) by registered or certified mail with postage prepaid, and return receipt requested; (c) by recognized overnight courier service with charges prepaid; or (d) by confirmed facsimile or electronic mail transmission, directed to the intended recipient as follows:

If to the Guarantor:

[ ]

If to the Guaranteed Party:

GSFS Investments I Corp.

c/o Goldman Sachs & Co.

200 West Street

New York, New York 10282

Attention: Michael Feldman

Fax: (212) 428-3868

Email address: mfeldman@gs.com

Either Guarantor or Guaranteed Party may change the information to which notices and other communications hereunder can be delivered by giving the other party notice in the manner herein set forth. A notice or other communication shall be deemed delivered on the earlier to occur of (i) its actual receipt; (ii) the date of signature acknowledging receipt if sent by registered or certified mail, with postage prepaid, and return receipt requested; (iii) the first business day following its deposit with a recognized overnight courier service; or (iv) the business day it is sent by confirmed facsimile or electronic mail transmission (if sent before 5:00 p.m. local time of the receiving party) or the next business day (if sent after 5:00 p.m. local time of the receiving party).

9. Successors and Assigns . This Guarantee shall be binding upon and shall inure to the benefit of the Guarantor and the Guaranteed Party and their respective successors and permitted assigns. The Guaranteed Party may assign this Guarantee without the prior written consent of the Guarantor to the extent the Guaranteed Party has assigned its interest in the payment of any of the Obligations pursuant to the terms of the Purchase Agreement. Any other assignment of this Guarantee by the Guaranteed Party without the prior written consent of the Guarantor, shall be void ab initio. The Guarantor may not assign this Guarantee without the prior written consent of the Guaranteed Party. Any assignment by the Guarantor without the prior written consent of the Guaranteed Party shall be void ab initio and shall have no effect on the Guaranteed Party’s rights against the Guarantor hereunder.

10. Governing Law; Venue and Jurisdiction; Waiver of Jury Trial . THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES, INCLUDING SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW. THE PARTIES HEREBY IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT IN THE COUNTY OF NEW YORK IN THE STATE OF NEW YORK WITH RESPECT TO ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTEE AND CONSENT TO THE SERVICE OF PROCESS IN ANY MANNER PERMITTED BY APPLICABLE LAW. EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING RELATING TO A DISPUTE AND FOR ANY COUNTERCLAIM WITH RESPECT THERETO ARISING OUT OF OR RELATING TO THIS GUARANTEE.

11. Severability . If any term or other provision of this Guarantee or of any of the instruments evidencing part or all of the Obligations is invalid, illegal, or incapable of being enforced by any rule of applicable law, or public policy, all other conditions and provisions of this Guarantee shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated herein are not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal, or incapable of being enforced, the Guarantor and Guaranteed Party shall negotiate in good faith to modify this Guarantee so as to effect the original intent of the Guarantor and Guaranteed Party as closely as possible in a mutually acceptable manner in order that the transactions contemplated herein are consummated as originally contemplated to the fullest extent possible.

[Signature page follows]

IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be executed and delivered on its behalf as of the date first written above.


[GUARANTOR]

By:
Name:
Title:

Exhibit 10.86

Execution Version

LIMITED GUARANTEE

LIMITED GUARANTEE (this “ Guarantee ”), dated as of May 27, 2011, by ADA-ES, Inc., a Colorado corporation (the “ Guarantor ”), in favor of GSFS Investments I Corp., a Delaware corporation (the “ Guaranteed Party ”). The Guarantor and the Guaranteed Party may hereinafter be referred to individually as a “ Party ” or collectively as the “ Parties ”.

PRELIMINARY STATEMENTS

A. Guarantor is a member of Clean Coal Solutions, LLC, a Colorado limited liability company (the “ Company ”).

B. The Company and the Guarantor desire to have the Guaranteed Party enter into certain Transaction Documents (as defined below) with, among others, the Company and/or the Guarantor.

1. Definitions .

2. Guarantee .

2.1 Irrevocable Guarantee .

2.3 No Effect on Guarantee . The obligations of the Guarantor under this Guarantee shall not be altered, limited, impaired or otherwise affected by:

3. Representations and Warranties of the Guarantor . The Guarantor hereby represents and warrants to the Guaranteed Party, as follows:

(a) The Guarantor is a corporation, validly existing and in good standing under laws of the State of Colorado.

(b) The Guarantor has full power, authority and legal right to execute and deliver this Guarantee and to perform its obligations hereunder.

(c) The execution, delivery and performance of this Guarantee have been duly authorized by all necessary corporate action on the part of the Guarantor.

(f) The execution and delivery by the Guarantor of this Guarantee do not and the performance by Guarantor of its obligations hereunder will not, (i) violate or require any filing or notice under any law applicable to Guarantor (other than the filing of this Guarantee with the United States Securities and Exchange Commission under the federal securities laws applicable to U.S. public companies, if applicable), (ii) conflict with or cause a breach of any provision in the certificate of incorporation, bylaws or other organizational document of Guarantor, or (iii) cause a breach of, constitute a default under, cause the acceleration of, create in any party the right to accelerate, terminate, modify or cancel, or require any authorization, consent, waiver or approval under any contract, license, instrument, decree, judgment or other arrangement to which Guarantor is a party or under which it is bound or to which any of its assets are subject (or result in the imposition of a Lien upon any such assets) except (in the case of this clause (iii)) for any that would not reasonably be expected to have a material adverse effect on Guarantor’s ability to perform its obligations under this Guarantee.

6. Guarantor’s Waivers . The Guarantor waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or proof of reliance by the Guaranteed Party upon this Guarantee or acceptance of this Guarantee; the Obligations, and any of them, shall conclusively be deemed to have been created, contracted, incurred, renewed, extended, amended or waived in reliance upon this

Guarantee, and all dealings between the Guarantor and the Guaranteed Party shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guarantee. The Guarantor waives presentment, demand (other than demand delivered pursuant to Section 2.1(a) hereof), notice, and protest of all instruments included in or evidencing any of the Obligations and all other demands (other than any demand delivered pursuant to Section 2.1(a) hereof) and notices in connection with the delivery, acceptance, performance, default or enforcement of any such instrument or this Guarantee.

If to the Guarantor:

ADA-ES, Inc.

8100 South Park Drive, Unit B

Littleton, CO 80120

Attn: Dr. Michael Durham

Fax: (303) 734-0330

Email address:

If to the Guaranteed Party:

GSFS Investments I Corp.

c/o Goldman Sachs & Co.

200 West Street

New York, New York 10282

Attention: Michael Feldman

Fax: (212) 428-3868

Email address: mfeldman@gs.com

[Signature page follows]

IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be executed and delivered on its behalf as of the date first written above.


ADA-ES, Inc.

By:		/s/ Michael D. Durham
Name:		Michael D. Durham
Title:		President & CEO

Exhibit 10.87

CONTRIBUTION AGREEMENT

This CONTRIBUTION AGREEMENT (this “ Agreement ”), dated as of May 27, 2011, between ADA-ES, Inc., a Colorado corporation (“ ADA-ES ”), and NexGen Refined Coal, LLC, a Wyoming limited liability company (“ NGRC ”, and collectively with ADA-ES, the “ Guarantors ” and each a “ Guarantor ”).

PRELIMINARY STATEMENTS

WHEREAS, ADA-ES has entered into a Limited Guarantee (the “ ADA-ES Guarantee ”), dated as of May 27, 2011, in favor of GSFS Investments I Corp., a Delaware corporation (the “ Guaranteed Party ”), in connection with indemnification obligations owed by Clean Coal Solutions, LLC, a Colorado limited liability company (“ CCS ”), to the Guaranteed Party under that certain Class B Unit Purchase Agreement (the “ Purchase Agreement ”), dated as of May 27, 2011, between the Company and the Guaranteed Party.

WHEREAS, NGRC has entered into a Limited Guarantee (the “ NGRC Guarantee ”, and collectively with the ADA-ES Guarantee, the “ Guaranties ” and each a “ Guarantee ”), dated as of May 27, 2011, in favor of the Guaranteed Party, in connection with indemnification obligations owed by the Company to the Guaranteed Party under the Purchase Agreement; and

WHEREAS, the Guarantors desire to allocate and delegate amongst themselves the obligations to the Guaranteed Party that may arise under any of the Guaranties.

NOW, THEREFORE, the Guarantors agree as follows:

SECTION 1. Defined Terms . The capitalized terms defined in the preamble and preliminary statements of this Agreement shall have the respective meanings specified therein and the following terms shall have the following meanings:

“ Contributing Guarantor ” means with respect to a Guarantor (an “ Obligated Guarantor ”) that becomes obligated under its respective Guarantee to make any payment to the Guaranteed Party, each other Guarantor.

“ Contributing Share ” means with respect to a Contributing Guarantor, a percentage, the numerator of which is one and the denominator of which is the number of Contributing Guarantors plus one.

SECTION 2. Agreement to Contribute . The Guarantors agree that if any Guarantor becomes and Obligated Guarantor, each Contributing Guarantor shall be required to contribute its Contributing Share to such payment owed to the Guaranteed Party promptly within ten (10) days following notice from the Obligated Guarantor that such contribution is due.

SECTION 3. Notices . All notices and other communications under this Agreement shall be in writing and delivered (a) personally; (b) by registered or certified mail with postage prepaid, and return receipt requested; (c) by recognized overnight courier service with charges prepaid; or (d) by confirmed facsimile or electronic mail transmission, directed to the intended recipient as follows:

If to ADA-ES :

ADA-ES, Inc.

8100 SouthPark Drive, Unit B

Littleton, CO 80120

Attn: Dr. Michael Durham

Fax: (303) 734-0330

Email address: miked@adaes.com

If to NGRC :

NexGen Refined Coal, LLC

3300 South Parker Road, Suite 310

Aurora, CO 80014

Attn: Charles S. McNeil, President

Fax: (303) 751-9210

Email address: cmcneil@nexgen-group.com

SECTION 4. Pledge of Interests in CCS . Each party hereby pledges all right, title and interest in and to their membership interests in CCS to secure all amounts that may become owing hereunder.

SECTION 5. Amendment . This Agreement may not be modified, amended, terminated or revoked, in whole or in part, except in writing signed by each of the Guarantors.

SECTION 6. Successors and Assigns . This Agreement shall be binding upon and shall inure to the benefit of each Guarantor and each of their respective successors and permitted assigns. This Agreement may only be assigned by a Guarantor in connection with an assignment by such Guarantor of its respective Guarantee.

SECTION 7. GOVERNING LAW; VENUE AND JURISDICTION; WAIVER OF JURY TRIAL . THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF COLORADO , UNITED STATES OF AMERICA, WITHOUT ANY REFERENCE TO CONFLICT OF LAWS PRINCIPLES. THE GUARANTORS HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY STATE COURT IN THE COUNTY OF ARAPAHOE, STATE OF COLORADO WITH RESPECT TO ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT AND CONSENT TO THE SERVICE OF PROCESS IN ANY MANNER PERMITTED BY LAW. EACH GUARANTOR HERETO IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY ACTION, SUIT OR PROCEEDING RELATING TO A DISPUTE AND FOR ANY COUNTERCLAIM WITH RESPECT THERETO.

[Remainder of page intentionally left blank.]

IN WITNESS WHEREOF, the Guarantors have caused this Agreement to be executed and delivered as of the date first written above.


ADA-ES, INC.

By:		/s/ Mark H. McKinnies
Name:		Mark H. McKinnies
Title:		SVP and CFO

NEXGEN REFINED COAL, LLC

By:		NexGen Refined Coal Holdings, LLC, its manager

By:		NexGen Synfuel Management, Inc., its manager

By:		/s/ Thomas A. Ostlund
Name:		Thomas A. Ostlund
Title:		President

Exhibit 31.1

Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as Amended

I, Michael D. Durham, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of ADA-ES, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 12, 2011


/s/ Michael D. Durham
Name:		Michael D. Durham

Exhibit 31.2

Pursuant to Rules 13a-14(a) and 15d-14(a) of the Securities Exchange Act of 1934, as Amended

I, Mark H. McKinnies, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of ADA-ES, Inc.;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.


Date: August 12, 2011

/s/ Mark H. McKinnies
Name:		Mark H. McKinnies

Exhibit 32.1

Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Michael D. Durham, as President and Chief Executive Officer of ADA-ES, Inc. (the “Company”), certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Michael D. Durham
Name:		Michael D. Durham
Title:		President and Chief Executive Officer

Date:		August 12, 2011

Exhibit 32.2

Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350,

as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

I, Mark H. McKinnies, as Chief Financial Officer of ADA-Es, Inc. (the “Company”), certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(2) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.


/s/ Mark H. McKinnies
Name:		Mark H. McKinnies
Title:		Chief Financial Officer

Date:		August 12, 2011