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Our boiler burner technology, which has been proven to achieve ground-breaking low air pollutant emissions, has been deployed in the US and is currently undergoing commercialization in China.
−Removed: Due to the “zero tolerance” SARS-COV-2 virus (“coronavirus” or “COVID-19”) regulations enacted by Chinese authorities during 2022, our commercialization efforts in China were significantly delayed.
−Removed: We believe that combustion equipment utilizing ClearSign Core technology is more effective and cost-efficient than current industry-standard air pollution control technologies, and can reduce NOx down to the levels required by new stringent emission regulations.
+Added: We believe that combustion equipment utilizing ClearSign Core technology is more effective and cost-efficient than current industry-standard air pollution control technologies, and can reduce nitrogen oxide (NOx) emissions down to the levels required by new stringent emission regulations.
NOx is a regulated greenhouse gas pollutant comprised of nitrogen oxide and nitrogen dioxide.
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The flame sensing products are applicable to all installed burners that use a pilot for ignition, including in markets and regions beyond those where reducing emissions is a high priority.
−Removed: Like our burner technology, our burner sensing
−Removed: technology is being developed to provide convenient replacement and retrofit solutions for existing equipment as well as for inclusion in newly built equipment.
+Added: Like our burner technology, our burner sensing technology is being developed to provide convenient replacement and retrofit solutions for existing equipment as well as for inclusion in newly built equipment.
The secondary potential market for our sensing technology is outside of the typical combustion industry and includes transportation industries.
−Removed: While use of this fundamental technology in applications intended for transportation markets is proven, the development and refinement of specific products, obtaining the certifications required for commercial deployment and establishing an efficient manufacturing source and channels to market will take some time, and we cannot assure that these goals will be achieved.
+Added: While use of this fundamental technology in applications intended for transportation markets is proven, the
+Added: development and refinement of specific products, obtaining the certifications required for commercial deployment and establishing an efficient manufacturing source and channels to market will take some time, and we cannot assure that these goals will be achieved.
We believe that the opportunities for application of our sensing technology in the transportation market are global and of great value, but it will also take longer to commercialize products targeted for this market for the reasons stated above.
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In December of 2020, the San Joaquin Valley region of California revised its regulations to require significant reductions in target NOx emissions from boilers, steam generators and process heaters.
−Removed: The greater Los Angeles area also revised its regulations in November of 2021.
−Removed: Under these revised regulations, it substantially reduced target emissions for process heaters, boilers and other similar equipment in accordance with a new and comprehensive Best Available Retrofit Control Technology (BARCT) analysis, which we believe will result in an increased demand for our services and products.
+Added: And, in November of 2021, the greater Los Angeles area also revised its regulations.
+Added: These revised regulations substantially reduced target emissions for process heaters, boilers and other similar equipment pursuant to a new and comprehensive Best Available Retrofit Control Technology (BARCT) analysis, which we believe will result in an increased demand for our services and products.
+Added: On February 2, 2024, the South Coast Air Quality Management District of California (SCAQMD) as part of its periodic public participation process to enhance existing Best Available Control Technologies (BACT) determinations, assessed the process burner performance of our ClearSign Core ™ burner technology in certain currently operating customer installations.
+Added: As a result of this assessment, SCAQMD approved new BACT performance guidelines for both single and multi-burner configurations.
+Added: BACT guidelines are periodically updated by SCAQMD to reflect advancements in technology and to ensure affected equipment utilize the most efficient technologies.
+Added: While the establishment of a new BACT benchmark does not specifically endorse ClearSign or our products, it does establish a limit in the industry that favors our products.
+Added: According to SCAQMD, BACT is the most stringent
+Added: emission limitation or control technique for a class and category of equipment that is “Achieved in Practice,” or “Contained in a State Implementation Plan” (SIP), or “Technologically Feasible.”
In addition, new regulations are starting to be adopted with respect to the NOx emissions of enclosed ground flares, which historically have not been viewed as a source of NOx emissions or subject to the same level of regulation.
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Boiler Technology
−Removed: ClearSign Core Plug & Play Burners
−Removed: Our ClearSign Core Plug & Play burners provide a simplified, pre-engineered and standardized direct burner replacement for traditional refinery process heaters.
+Added: ClearSign Core Process Burner Technology
+Added: Our ClearSign Core burners provide a simplified, pre-engineered and standardized direct burner replacement for traditional refinery process heaters.
We believe that this product minimizes the customized engineering associated with retrofits and lends itself to mass production.
The product was designed to enable quick and easy installation in single burner or multi-burner heaters or furnaces.
−Removed: We believe that the simplicity of the actions required to retrofit refinery process heaters with the ClearSign Core Plug & Play, and the potential ability to install the ClearSign Core Plug & Play will potentially contribute to demand for our ClearSign Core Plug & Play burners.
+Added: We believe that the simplicity of the actions required to retrofit refinery process heaters with the ClearSign Core technology, and the potential ability to install these burners will potentially contribute to demand for our ClearSign Core process burners.
ClearSign Core Boiler Burner Technology
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Unlike the traditional technology, called “flame rods”, the ClearSign Eye sensing electrodes do not need to make contact with the flame.
−Removed: We are continuing to pursue “first adopter” installation opportunities for this patent pending sensing technology.
+Added: We are continuing to pursue “first adopter” installation opportunities for this patented sensing technology.
We have multiple options open to us as channels to market, one of which includes manufacturing the sensors ourselves as an OEM and selling them to customers either directly or indirectly through intermediaries, and another being licensing.
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Development of Our Technology
−Removed: To date, we have deployed our ClearSign Core technology through retrofits and replacements of existing burners and complete replacement units in the case of our Plug & Play and boiler burner products.
+Added: To date, we have deployed our ClearSign Core technology through retrofits and replacements of existing burners and complete replacement units in the case of our process burner and boiler burner products.
Retrofits often involve engineering around an existing burner architecture that can complicate the ClearSign Core burner installation, whereas replacements are more straightforward and more amenable to being sold and installed by third parties, enabling more expansive channels to market.
−Removed: This is especially the case after the introduction of our Plug & Play technology in February 2017 and the simplified control and operation of this technology enabled by the inclusion of a new start up and flame initiation system in April 2019.
Because of this, we have focused the development of our technology to provide designs that can be included into our prospective customers’ equipment as self-contained modules or assemblies rather than projects involving the re-engineering of existing burner systems.
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The industries using our technology take a conservative approach to adopting new technology and place significant reliance on references from existing customers when selecting new equipment.
−Removed: A major focus of our current business development activities is to make early sales and build our reference list in both the process burner and boiler industries.
+Added: A major focus of our current business development activities is to make early sales and build our reference list in both the process burner and boiler burner industries.
We also seek to provide comprehensive technical support to our sales efforts as well as demonstrate our technology and products in operation.
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As noted above, retrofits often involve engineering around an existing burner architecture that can complicate the installation.
−Removed: This was the case with the old “Duplex” technology, which we no longer promote although we continue servicing installed units.
−Removed: Our replacement
−Removed: products have become more attractive since the 2017 introduction of our Plug & Play technology and the 2019 introduction of our start up and flame initiation system, which simplifies the control and operation of our products.
By developing our ClearSign Core technology into a replacement product, we have been able to standardize our designs and simplify supply-chain demands.
−Removed: In addition, by removing the need to individually engineer every application, we have enabled collaboration with other commercial equipment suppliers with the intent to incorporate our ClearSign Core technology into their standard product lines.
+Added: In addition, we have enabled collaboration with other commercial equipment suppliers with the intent to incorporate our ClearSign Core technology into their standard product lines.
We believe that this further development of our products has greatly increased our ability to collaborate with partners to extend our potential market reach and the resources we make available to our prospective customers.
Process Heaters in the Oil Refining, Petrochemical and Gas Processing Industries
−Removed: To date, we have retrofitted five process heaters with our new ClearSign Core burners for refineries and fuel distributors some of which are owned by global supermajor companies and Fortune 500 companies.
−Removed: Sites include three locations in California and one in Europe.
−Removed: The ClearSign Core “Plug & Play” design provides a more simplified, pre-engineered and standardized direct burner replacement for traditional refinery process heaters that we believe can be mass produced and reduce the need for the customized engineering associated with typical retrofits.
−Removed: The ClearSign Core “Plug & Play” design (including the boiler burner version) is our most developed burner product.
+Added: To date, we have retrofitted six process heaters with our new ClearSign Core process burners for refineries and fuel distributors, some of which are owned by global supermajor companies and Fortune 500 companies.
+Added: Sites include four locations in California and one in Europe.
+Added: The ClearSign Core design provides a more simplified, pre-engineered and standardized direct burner replacement for traditional refinery process heaters that we believe can be mass produced and reduce the need for the customized engineering associated with typical retrofits.
+Added: The ClearSign Core design (including the boiler burner version) is our most developed burner product.
It operates essentially in the same way as a standard burner, including fitting into a heater and integrating with existing control systems.
We believe that this product is suitable for licensing as well as potential manufacturing arrangements with OEMs that have established manufacturing and distribution capabilities.
−Removed: At this time, we have a collaboration agreement in place with Zeeco Inc., which is one of the world’s largest combustion equipment manufacturers (“Zeeco”).
−Removed: The selling and marketing of our process burners pursuant to this agreement, however, is contingent on the successful completion of a comprehensive product performance and validation test.
+Added: At this time, we have a collaboration agreement in place with Zeeco Inc., one of the world’s largest combustion equipment manufacturers (“Zeeco”).
+Added: The selling and marketing of our process burners pursuant to this agreement, however, is contingent upon terms still under negotiation.
In 2021, we received our first international purchase order for a ClearSign Core refining process heater from a global supermajor refining company.
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In addition, we fulfilled a multi-burner order for a Fortune 500 infrastructure company that continues to consistently meet all performance requirements including compliance with the California site’s air quality permit.
−Removed: We also received a purchase order in 2022 from a California refinery for our ClearSign Core “Plug & Play” burners.
−Removed: To date, this purchase order is the largest received by ClearSign with the total order quantity amounting to twenty ClearSign Core “Plug & Play” burners.
−Removed: As we seek to expand the markets into which we can sell our products, we plan to continue extending the range of ClearSign Core Plug & Play products to enable the replacement of other burner shapes and configurations, as well as for use in alternate process applications.
+Added: The process burner installed at this site was used by SCAQMD to set new BACT guidelines (see discussion above under the “Our Industry” section).
+Added: We also received a purchase order in 2022 from a California refinery for our ClearSign Core process burners.
+Added: To date, this purchase order is the largest received by ClearSign with the total order quantity amounting to twenty burners.
+Added: Due to project delays, which were outside of our control, the process burner for this order has not yet been shipped to the jobsite.
+Added: On May 18, 2023, we received an order for thirteen process burners from an existing California refinery customer.
+Added: The order covered retrofitting two heaters, one of which we satisfied the contractual obligations for during the fourth quarter of 2023.
+Added: The process burners installed in this heater passed the customer’s NOx emissions permit level, which was validated by a third-party inspector.
+Added: We expect to satisfy the contractual obligations for the second heater during 2024.
+Added: In 2023, we received a purchase order from a heater manufacturer to install a modified ClearSign Core boiler burner into a horizontally fired process heater.
+Added: The end customer was a chemical company located in Texas.
+Added: We believe this project was a significant achievement to us, specifically for its ability to demonstrate a new product offering;
+Added: Moreover, we believe this order may be the first step towards more stringent changes to the Texas air emissions regulations, which we expect will turn into additional demand for our technology.
+Added: As we seek to expand the markets into which we can sell our products, we plan to continue extending the range of ClearSign Core process burners to enable the replacement of other burner shapes and configurations, as well as for use in alternate process applications.
+Added: Hydrogen Process Burners
+Added: We are currently in the research and development phase to design a one-hundred percent 100% hydrogen capable ClearSign Core process burner.
+Added: The goal of this project is to develop an ultra-low NOx hydrogen burner, which we believe will enable the adoption of hydrogen fuel for industrial heating, leading to reductions in the industrial emissions of both carbon dioxide and nitrogen oxides.
+Added: Current burners and previous efforts to decarbonize industrial combustion processes through the utilization of hydrogen fuel are inhibited by the lack of industrial hydrogen burners capable of burning pure hydrogen while controlling emissions of NOx emissions to the most stringent levels required in the industry.
+Added: We have received a series of grants from the Department of Energy (DOE) to fund the development of this technology.
+Added: In total, the two DOE awards approximate $1.9 million with a target end date occurring in 2025.
+Added: Refer to the financial statement “Note 11 – Government Assistance” for further details about these monies.
Industrial Commercial Boilers
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Our “Core” boiler burner technology has been developed to enable it to be used in a series of consistently designed sizes ranging from small fire tube boilers up to large industrial water tube boilers.
−Removed: For fire tube products, we have developed our own patent protected burner replacement product that is similar in concept to our ClearSign Core Plug & Play device for process heaters.
+Added: For fire tube products, we have developed our own patent protected burner replacement product that is similar in concept to our ClearSign Core burners for process heaters.
These boiler burners have achieved performance levels meeting the most stringent new California NOx regulations, in a typical commercial fire tube boiler produced by one of the industry’s largest suppliers in the U.S.
For instance, through our collaboration agreement in place with California Boiler to sell, deliver, install and service fire tube boiler burners in the U.S., we were able access larger sizes of fire tube boilers in order to verify the function of a range of fire tube boiler burners.
+Added: In 2023, we received two purchase orders for our ClearSign Core boiler burner technology.
+Added: Both boiler burner purchase orders were sold as a package with our partner California Boiler into the San Joaquin Valley Air Pollution Control District of California.
+Added: The NOx emission permits for these boilers vary, with one boiler noted at 5ppm and the other at 2.5ppm.
+Added: Third-party source testing has validated the 5ppm emission order, but due to customer on-site construction delays, the other order has yet to be installed.
Additionally, we demonstrated the operation of our small fire tube burner for Chinese officials, who subsequently certified it for sale in China.
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Ltd and one of China's top 500 enterprises.
−Removed: If further testing and certification is successful in China, our goal will be to sell the boiler burner technology into the very large Chinese
−Removed: market through our collaborative partnership.
−Removed: Water tube boilers are larger and more varied in their designs and verification projects are ongoing.
−Removed: We anticipate making continued progress during 2023 both demonstrating and commercializing such equipment, although our progress may continue to be delayed by the effects of the COVID-19.
−Removed: Water tube boiler burners are particularly important in China because of the extensive network of government-run heating districts that provide heat in the northern regions of China.
+Added: If further testing and certification is successful in China, our goal will be to sell the boiler burner technology into the very large Chinese market through our collaborative partnership.
+Added: We anticipate making continued progress during 2024 both demonstrating and commercializing such equipment.
Wellhead Enclosed Flares
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California, for example, has already added new low NOx emissions regulations for flares.
−Removed: We have adapted the ClearSign Core technology to suit this application.
+Added: We have adapted ClearSign Core technology to suit this application.
Our collaboration agreement with the field engineering and servicing company California Boiler includes flare sales and installation.
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We believe our new standardized boiler burner range of products is also well suited to this application.
+Added: Sensing Products
+Added: We are currently seeking first adopters to install our flame sensors for field demonstration.
+Added: Although we have not yet completed the product launch of our sensing products and subsequent commercialization, we have obtained clear and consistent customer feedback guiding its first application.
+Added: The target market for this technology is potentially every burner with a pilot on which flame sensors are deployed, providing a global and very high-volume opportunity.
+Added: This market is not limited by emissions mandates or the type or manufacturer of the burners.
+Added: The product has value for retrofit applications, where it is applied to existing burners, and for new burners, where it can be installed in burners by OEMs.
+Added: We are assessing the possibility of manufacturing the sensing products ourselves as well as partnering with one or more established OEM suppliers.
+Added: Demonstration units have been manufactured and we currently have the ability to manufacture the sensor ourselves for the foreseeable future.
+Added: We are also exploring alternative paths to monetize the technology, including opportunities to license our technology.
+Added: The fundamental technology for the sensors envisioned for transport applications is the same as for the flame sensors, but the application and form of the final product will be very different.
+Added: We have received notable interest in this product from a major global customer giving us the confidence that there is a potential market for this technology, which is therefore worthy of future investment.
+Added: This sensor product is in the very early stages of development and would be deployed in a highly regulated environment requiring a thorough product development process.
+Added: The interest we have received to date, however, suggests that this could potentially be a significant future business opportunity for ClearSign.
Our Target Markets
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Accordingly, we prioritize our activities in target market segments geographically based on the needs of the local industries and the current and anticipated future requirements imposed by local environmental regulation.
−Removed: Details regarding the localized effect of environmental regulation in the United States are described in the section of this report titled “Our Industry.” In general, our immediate regional opportunities are in the West and Gulf Coasts of the United States and the regions of Northern China with high populations and cooler environments.
−Removed: In these areas of China, district heating is a large source of fossil fuel consumption, and reducing atmospheric pollution is a high priority of both the national and local governments.
+Added: Details regarding the localized effect of environmental regulation in the United States are described in the section of this report titled “Our Industry.” In general, our immediate regional opportunities are in the West and Gulf Coasts of the United States and China.
Competition, Barriers to Entry and Go to Market Strategy
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These suppliers possess resources that are substantially greater than ours.
−Removed: Worldwide, suppliers of burners and air pollution control equipment include but are not limited to companies such as Callidus, Eclipse and Maxon
−Removed: (all three are subsidiaries of Honeywell), John Zink Hamworthy Combustion (a subsidiary of Koch Industries and including Coen), General Electric, Haldor Topsøe, Hitachi, Linde, Zeeco, Fives Group, Cleaver Brooks, Power Flame (a subsidiary of Aztec Inc.), and others.
+Added: Worldwide, suppliers of burners and air pollution control equipment include but are not limited to companies such as Callidus, Eclipse and Maxon (all three are subsidiaries of Honeywell), John Zink Hamworthy Combustion (a subsidiary of Koch Industries and including Coen), General Electric, Haldor Topsøe, Hitachi, Linde, Zeeco, Fives Group, Cleaver Brooks, Power Flame (a subsidiary of Aztec Inc.), and others.
These companies provide systems that include low and ultra-low NOx burners, selective and non-selective catalytic reduction systems, and other pollution control technologies.
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As announced in June 2019, we already have an agreement in place with Zeeco, who is one of the world’s largest burner manufacturers, to globally manufacture ClearSign Core process burners.
−Removed: The selling and marketing of our process burners pursuant to this agreement, however, is contingent on the successful completion of a comprehensive product performance and validation test.
−Removed: In addition, we have a collaborative agreement with California Boiler to sell and produce both fire tube boiler burner and flare products.
+Added: The selling and marketing of our process burners pursuant to this agreement, however, is contingent upon terms still under negotiation.
+Added: In addition, we have a collaborative agreement with California Boiler to sell and
+Added: produce both fire tube boiler burner and flare products.
We are also pursuing various licensing types of arrangements for other market verticals and ClearSign Core applications.
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As a result, we expect that products containing ClearSign Core technology will sell at prices based on the value they offer rather than pursuant to standard competitive pricing that our competitors are forced to use in these mature markets.
−Removed: Sensing Products.
−Removed: We are currently seeking first adopters to install our flame sensors for field demonstration.
−Removed: Although we have not yet completed the product launch of our sensing products and subsequent commercialization, we have obtained clear and consistent customer feedback guiding its first application.
−Removed: The target market for this technology is potentially every burner with a pilot on which flame sensors are deployed, providing a global and very high-volume opportunity.
−Removed: This market is not limited by emissions mandates or the type or manufacturer of the burners.
−Removed: The product has value for retrofit applications, where it is applied to existing burners, and for new burners, where it can be installed in burners by OEMs.
−Removed: We are assessing the possibility of manufacturing the sensing products ourselves as well as partnering with one or more established OEM suppliers.
−Removed: Demonstration units have been manufactured and we currently have the ability to manufacture the sensor ourselves for the foreseeable future.
−Removed: We are also exploring alternative paths to monetize the technology, including opportunities to license our technology.
−Removed: The fundamental technology for the sensors envisioned for transport applications is the same as for the flame sensors, but the application and form of the final product will be very different.
−Removed: We have received notable interest in this product from a major global customer giving us the confidence that there is a potential market for this technology, which is therefore worthy of future investment.
−Removed: This sensor product is in the very early stages of development and would be deployed in a highly regulated environment requiring a thorough product development process.
−Removed: The interest we have received to date, however, suggests that this could potentially be a significant future business opportunity for ClearSign.
Suppliers and Subcontractors
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however, we intend to pass along production cost increases to customers to the extent we deem appropriate.
−Removed: We expect that delays, interruptions or non-optimal scheduling of production related to interruptions in raw materials supplies would result in an increase to our costs.
−Removed: We can give no assurance that the COVID-19 pandemic, global supply-chain constraints or geopolitical conflicts will not adversely affect our ability or our subcontractors’ ability to procure raw materials and components necessary to build our products.
+Added: We expect that delays, interruptions or non-optimal scheduling of production related to interruptions in raw materials supplies would result in an increase to our production costs.
+Added: We can give no assurance that global supply-chain constraints or geopolitical conflicts will not adversely affect our ability or our subcontractors’ ability to procure raw materials and components necessary to build our products.
Research and Development Program
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This later phase of development is influenced by customer feedback, product and component standardization, design for manufacture and inventory management simplification, both with respect to the manufacture of and lifetime support for our products.
−Removed: Our technology and products for flame sensing applications have been proven at bench scale in our laboratory and at full scale in “first article” form.
−Removed: This product is currently in the commercialization phase.
−Removed: As discussed above, we also have another form of our sensing technology that we believe can indicate the potential flammability of a hydrocarbon gas and air mixture, which can have great and varied application in other industries such as transport.
−Removed: This product is in an earlier form and is currently undergoing validation and optimization of its intended role in this very different application.
+Added: We will continue to assess research and development opportunities to develop new product offerings where appropriate based on customer feedback and market trends.
+Added: We are currently continuing to develop our flame sensing and hydrogen burner technology, which is discussed in detail under the “ClearSign Core Technology Product Applications” section above in addition to the expansion of our burner technologies into adjacent customer applications and market verticals.
Intellectual Property Protection
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Further, we may modify a patent application in the future as we develop additional information.
−Removed: As a result, we may create additional patent applications from an existing application, consolidate existing patent applications, abandon applications, or otherwise modify applications based upon our judgment in order to protect our intellectual property in a reasonably cost-efficient manner.
+Added: As a result, we may create additional patent applications from an
+Added: existing application, consolidate existing patent applications, abandon applications, or otherwise modify applications based upon our judgment in order to protect our intellectual property in a reasonably cost-efficient manner.
Government Regulation
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We were incorporated in the State of Washington on January 23, 2008.
+Added: Effective June 14, 2023, we changed our domicile from the State of Washington to the State of Delaware by means of a plan of conversion.
The address of our corporate headquarters is 8023
−Removed: East 63rd Place, Suite 101, Tulsa, OK and our telephone number is (918) 236-6461.
+Added: East 63rd Place, Suite 101, Tulsa, Oklahoma 74133 and our telephone number is (918) 236-6461.
Our website can be accessed at www.clearsign.com.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.