<SEC-DOCUMENT>0001144204-13-060168.txt : 20131112
<SEC-HEADER>0001144204-13-060168.hdr.sgml : 20131111
<ACCEPTANCE-DATETIME>20131112063836
ACCESSION NUMBER:		0001144204-13-060168
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20131111
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20131112
DATE AS OF CHANGE:		20131112

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CLEARSIGN COMBUSTION CORP
		CENTRAL INDEX KEY:			0001434524
		STANDARD INDUSTRIAL CLASSIFICATION:	INDUSTRIAL INSTRUMENTS FOR MEASUREMENT, DISPLAY, AND CONTROL [3823]
		IRS NUMBER:				000000000
		STATE OF INCORPORATION:			WA

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-35521
		FILM NUMBER:		131206826

	BUSINESS ADDRESS:	
		STREET 1:		12870 INTERURBAN AVENUE SOUTH
		CITY:			SEATTLE
		STATE:			WA
		ZIP:			98168
		BUSINESS PHONE:		(206) 673-4848

	MAIL ADDRESS:	
		STREET 1:		12870 INTERURBAN AVENUE SOUTH
		CITY:			SEATTLE
		STATE:			WA
		ZIP:			98168
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>v360162_8k.htm
<DESCRIPTION>FORM 8-K
<TEXT>
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<P STYLE="margin: 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>SECURITIES
AND EXCHANGE COMMISSION </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>WASHINGTON,
D.C. 20549</B></FONT></P>

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<!-- Field: Rule-Page --><DIV ALIGN="CENTER" STYLE="margin-top: 3pt; margin-bottom: 3pt"><DIV STYLE="font-size: 1pt; border-top: Black 1pt solid; width: 25%"><FONT STYLE="color: Black">&nbsp;</FONT></DIV></DIV><!-- Field: /Rule-Page -->

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black"><B>&nbsp;&nbsp;</B></FONT></P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>FORM
8-K </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>CURRENT
REPORT </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>Pursuant
to Section 13 or 15(d) of the </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>Securities
Exchange Act of 1934 </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>Date
of report (Date of earliest event reported): November 11, 2013</B></FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black">&nbsp;&nbsp;</FONT></P>

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<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black"><B>CLEARSIGN
COMBUSTION CORPORATION</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black"><B>(Exact name
of registrant as specified in Charter) </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black"><B>&nbsp;&nbsp;</B></FONT></P>

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<tr>
    <TD STYLE="vertical-align: top; width: 32%; text-align: center"><FONT STYLE="font-size: 10pt; color: Black"><B>Washington</B></FONT></td>
    <TD STYLE="vertical-align: bottom; width: 2%"><FONT STYLE="color: Black">&nbsp;</FONT></td>
    <TD STYLE="vertical-align: top; width: 32%; text-align: center"><FONT STYLE="font-size: 10pt; color: Black"><B>001-35521</B></FONT></td>
    <TD STYLE="vertical-align: bottom; width: 2%"><FONT STYLE="color: Black">&nbsp;</FONT></td>
    <TD STYLE="vertical-align: top; width: 32%; text-align: center"><FONT STYLE="font-size: 10pt; color: Black"><B>26-2056298</B></FONT></td></tr>
<tr>
    <TD STYLE="vertical-align: top"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black"><B>(State
        or other jurisdiction of</B></FONT></P>
        <P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black"><B>incorporation
        or organization)</B></FONT></P></td>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="color: Black">&nbsp;</FONT></td>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 10pt; color: Black"><B>(Commission File No.)</B></FONT></td>
    <TD STYLE="vertical-align: bottom"><FONT STYLE="color: Black">&nbsp;</FONT></td>
    <TD STYLE="vertical-align: top; text-align: center"><FONT STYLE="font-size: 10pt; color: Black"><B>(IRS Employee Identification
    No.)</B></FONT></td></tr>
</table>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: Black">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>12870
Interurban Avenue South</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>Seattle,
Washington 98168</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>(Address
of Principal Executive Offices) </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: center; margin-bottom: 0pt"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>206-673-4848</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; text-align: center"><FONT STYLE="color: Black"><B>(Issuer
Telephone number) </B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: Black">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">Check the appropriate box below
if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the Registrant under any of the following
provisions (see General Instruction A.2 below).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings; color: Black">&#168;</FONT><FONT STYLE="color: Black">
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings; color: Black">&#168;</FONT><FONT STYLE="color: Black">
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR240.14a-12)</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings; color: Black">&#168;</FONT><FONT STYLE="color: Black">
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)).</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="font-family: Wingdings; color: Black">&#168;</FONT><FONT STYLE="color: Black">
Pre-commencement communications pursuant to Rule 13e-(c) under the Exchange Act (17 CFR 240.13(e)-4(c))</FONT></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black"><B>Item 2.02&#9;Results of Operations
and Financial Condition.</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0 0pt 63pt; text-indent: -63pt"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: Black">On November
11, 2013, ClearSign Combustion Corporation issued a press release announcing the results for the quarter ended September 30, 2013
and the timing for its conference call to discuss earnings results for the quarter. The press release is included as Exhibit 99.1
to this Current Report on Form 8-K and is incorporated by reference in its entirety into this Item 2.02.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black"><B>Item 9.01&#9;Financial Statements
and Exhibits</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 0.5in"><FONT STYLE="color: Black">Exhibit 99.1&#9;Press
release dated November 11, 2013</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: bold 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">SIGNATURE</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-indent: 1in"><FONT STYLE="color: Black">Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report to be signed on its behalf
by the undersigned hereunto duly authorized.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">Dated: November 12, 2013</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

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<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD COLSPAN="2" STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black">CLEARSIGN COMBUSTION CORPORATION</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0; width: 50%"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0; text-indent: 0; width: 1%"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="padding: 0; text-indent: 0; width: 49%"><FONT STYLE="color: Black">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black">By:&nbsp;&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="padding: 0; text-indent: 0; border-bottom: Black 1pt solid"><FONT STYLE="font-size: 10pt; color: Black">/s/
    James N. Harmon</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black">James N. Harmon</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="padding: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD NOWRAP STYLE="padding: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black">Chief Financial Officer</FONT></TD></TR>
</TABLE>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: center"><FONT STYLE="color: Black"><B>EXHIBIT INDEX</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black">&nbsp;</FONT></P>

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    <TD STYLE="width: 10%; padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black"><B>Exhibit
    No.</B></FONT></TD>
    <TD STYLE="width: 2%; padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="width: 88%; padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black"><B>Description</B></FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
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    <TD STYLE="padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black">99.1</FONT></TD>
    <TD STYLE="padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="color: Black">&nbsp;</FONT></TD>
    <TD STYLE="padding-right: 0; padding-left: 0; padding-top: 0; text-indent: 0"><FONT STYLE="font-size: 10pt; color: Black">Press
    release dated November 11, 2013</FONT></TD></TR>
</TABLE>


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<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>v360162_ex99-1.htm
<DESCRIPTION>EXHIBIT 99.1
<TEXT>
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<P STYLE="margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; text-align: right"><FONT STYLE="color: Black">Exhibit 99.1</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #002E62; background-color: white"><FONT STYLE="font-weight: normal; color: Black">ClearSign
Combustion Corporation Announces Third Quarter 2013 Results</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; color: #002E62; background-color: white"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">Nov
11, 2013</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">SEATTLE,&nbsp;Nov.
11, 2013&nbsp;/PRNewswire/ --&nbsp;ClearSign Combustion Corporation (Nasdaq: CLIR), an emerging leader in combustion and emissions
control technology for industrial, commercial and utility markets, today announced its results for the quarter ended&nbsp;September
30, 2013. The Company incurred losses of&nbsp;$1,362,000&nbsp;and$4,125,000&nbsp;for the three months and nine months ended&nbsp;September
30, 2013, respectively, as compared to losses f&nbsp;$1,132,000&nbsp;and&nbsp;$3,017,000&nbsp;for the same periods in 2012. &nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">ClearSign
recorded its first revenue in the three months ended&nbsp;September 30, 2013totaling&nbsp;$50,000. This resulted from a portion
of the initial phase of a solid fuel burner co-development project, sponsored by a major waste-to-energy company</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0">Research and development costs totaled $470,000 and $1,466,000
for the three months and nine months ended September 30, 2013, respectively, as compared to $331,000 and $887,000 for the same
periods in 2012, reflecting increased personnel levels and research activities in 2013. General and administrative costs increased
to $911,000 and $2,685,000 for the three months and nine months ended September 30, 2013, respectively, as compared to $811,000
and $2,145,000 for the same periods in 2012, reflecting increased marketing costs and the expense of operating as a public company
following the Company's initial public offering in April 2012 at $4.00 per share raising net proceeds of $11,640,000.</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">Working
capital at&nbsp;September 30, 2013&nbsp;totaled&nbsp;$3,303,000, including cash and cash equivalents of&nbsp;$3,989,000. Management
expects these funds to be sufficient to fund activities at least through&nbsp;April 2014.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&ldquo;The
third quarter has been tremendously productive, and I'm excited to report that not only has ClearSign achieved several major commercialization
milestones ahead of schedule, but the results we are reporting have exceeded even our best-case expectations and are attracting
significant attention from prospective partners and customers. We have now demonstrated NOx emissions -- in the burner alone --
at levels that compete with state of the art NOx control systems costing hundreds of thousands of dollars. Moreover the Duplex
burner features a dramatically lower ongoing cost of ownership as compared to these costly &ldquo;post-combustion&rdquo; systems.
Some of the world's leading companies are paying close attention to these results as we push forward aggressively toward commercialization
of what is a potentially a market-disrupting technology,&rdquo; said ClearSign CEO,&nbsp;Rick Rutkowski.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">According
to Rutkowski, Filtration+Separation magazine estimates in its&nbsp;April 2013&nbsp;issue that the market for NOx control technology
will be&nbsp;$11 billion&nbsp;in 2014 of which non-utility [commercial and industrial boiler applications] will comprise over&nbsp;$2
billion&nbsp;annually. Reporting in the American Society of Mechanical Engineers, the McIlvaine Company projects double-digit
growth in this market, placing NOx control at #4 on its list of the top ten most promising growth markets in energy, air and water.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">Rutkowski
continued, &ldquo;Several highlights from this quarter include:</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white; color: #0D1E4C"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font-family: Wingdings; color: Black">&sect;</FONT></TD><TD><FONT STYLE="color: Black">&ldquo;This
                                                                                                            morning&rsquo;s announcement
                                                                                                            that we have now demonstrated
                                                                                                            that ClearSign's Duplex
                                                                                                            burner architecture
                                                                                                            may support the long-sought
                                                                                                            industry goal of achieving
                                                                                                            near-zero emissions
                                                                                                            of both NOx and CO,
                                                                                                            while offering the
                                                                                                            most compelling combination
                                                                                                            of performance and
                                                                                                            ownership costs of
                                                                                                            any technology on
                                                                                                            the market today.
                                                                                                            ClearSign's Duplex
                                                                                                            burner architecture
                                                                                                            achieves NOx levels
                                                                                                            -- using only a standard
                                                                                                            burner -- that today
                                                                                                            require systems costing
                                                                                                            an average of&nbsp;$600,000&nbsp;for
                                                                                                            the 36,000 large industrial
                                                                                                            boilers in the US
                                                                                                            alone.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white; color: #0D1E4C"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font-family: Wingdings; color: Black">&sect;</FONT></TD><TD><FONT STYLE="color: Black">&ldquo;This
                                                                                                            amounts to an unparalleled
                                                                                                            90% reduction in NOx
                                                                                                            emissions -- from
                                                                                                            50 PPM to 5 PPM --
                                                                                                            eliminating the need
                                                                                                            for expensive SCR
                                                                                                            and FGR technologies.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white; color: #0D1E4C"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font-family: Wingdings; color: Black">&sect;</FONT></TD><TD><FONT STYLE="color: Black">&ldquo;This
                                                                                                            quarter, we also demonstrated
                                                                                                            the ability to shape
                                                                                                            the flame in a solid-fuel
                                                                                                            combustion system,
                                                                                                            creating more even
                                                                                                            heat distribution
                                                                                                            and reducing peak
                                                                                                            temperatures -- a
                                                                                                            technique we believe
                                                                                                            may significantly
                                                                                                            increase system capacity,
                                                                                                            leading to greater
                                                                                                            profitability for
                                                                                                            operators of solid
                                                                                                            fuel combustion systems
                                                                                                            such as municipal
                                                                                                            solid waste. More
                                                                                                            even heat distribution
                                                                                                            will also reduce maintenance,
                                                                                                            particularly costly
                                                                                                            unscheduled maintenance.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white; color: #0D1E4C"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font-family: Wingdings; color: Black">&sect;</FONT></TD><TD><FONT STYLE="color: Black">&ldquo;ClearSign
                                                                                                            met its aggressive
                                                                                                            2013 goal of dropping
                                                                                                            NOx to 2 PPM in a
                                                                                                            vertically-fired configuration
                                                                                                            similar to burners
                                                                                                            found in the petrochemical
                                                                                                            and refining facilities.
                                                                                                            As a result, we revised
                                                                                                            our already aggressive
                                                                                                            goal to achieve 1
                                                                                                            PPM or lower by the
                                                                                                            end of the year.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white; color: #0D1E4C"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font-family: Wingdings; color: Black">&sect;</FONT></TD><TD><FONT STYLE="color: Black">&ldquo;This
                                                                                                            major accomplishment
                                                                                                            was announced at a
                                                                                                            live web conference
                                                                                                            which included a roundtable
                                                                                                            of industry experts,
                                                                                                            including current
                                                                                                            and former managers
                                                                                                            and leading researchers
                                                                                                            at Marathon Petroleum
                                                                                                            Corporation, Chevron
                                                                                                            Corporation, The Energy
                                                                                                            Solutions Center and
                                                                                                            the&nbsp;University
                                                                                                            of California, Berkeley.</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt; background-color: white; color: #0D1E4C"><TR STYLE="vertical-align: top">
<TD STYLE="width: 12pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font-family: Wingdings; color: Black">&sect;</FONT></TD><TD><FONT STYLE="color: Black">&ldquo;ClearSign's
                                                                                                            thought leadership
                                                                                                            and visibility within
                                                                                                            the combustion and
                                                                                                            emissions control
                                                                                                            industries is also
                                                                                                            increasing. ClearSign
                                                                                                            CTO,&nbsp;Joe Colannino,
                                                                                                            spoke at two prestigious
                                                                                                            conferences, including
                                                                                                            the American Flame
                                                                                                            Research Council's
                                                                                                            2013 Industrial Combustion
                                                                                                            Symposium in&nbsp;Honolulu&nbsp;and
                                                                                                            the Air Quality IX
                                                                                                            conference inWashington,
                                                                                                            DC, both generating
                                                                                                            strong interest.</FONT></TD></TR></TABLE>

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<TD STYLE="width: 12pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font-family: Wingdings; color: Black">&sect;</FONT></TD><TD><FONT STYLE="color: Black">&quot;Media
                                                                                                            interest in ClearSign
                                                                                                            resulted in several
                                                                                                            articles including&nbsp;MIT
                                                                                                            Technology Review,&nbsp;Popular
                                                                                                            Science,&nbsp;Discovery
                                                                                                            News&nbsp;and&nbsp;EE
                                                                                                            Times. This&nbsp;exposure
                                                                                                            has resulted in a
                                                                                                            dramatic increase
                                                                                                            in traffic to ClearSign's
                                                                                                            website, with views
                                                                                                            of our &ldquo;Future
                                                                                                            of Fire&rdquo; video
                                                                                                            spiking dramatically
                                                                                                            with over 1,000 views
                                                                                                            daily. This has resulted
                                                                                                            in increased media
                                                                                                            attention and further
                                                                                                            enquiries from major
                                                                                                            media.</FONT></TD></TR></TABLE>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&ldquo;Our
goal for the remainder of the year remains to enter into collaborative agreements with leading suppliers and end-users in the
three target segments that we have previously identified: Refinery and petrochemical process heaters, packaged boilers, and industrial
solid fuel combustors. We continue to identify additional applications including a variety of process heater types and the potential
application of our technology to improve gasification processes. We are also setting the stage for collaborative arrangements
in&nbsp;Asia, and are targeting the first half of 2014 for partnering in this strategically important, and very large market.&rdquo;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">The
Company announced that it intends to scale the package boiler configuration over the next several quarters from its current 1.1
MMBtu/h, first to 2 MMBtu/h and then to 3.4 MMBtu/h, which is the average burner size found in over 110,000 US-based units in
the commercial market segment. The Company then expects to scale the novel burner design to achieve thermal output of over 10
MMBtu/h, positioning it for entry into the industrial and large commercial boiler market segment, in which there are more than
36,000 large units. For up-fired refinery burner applications, the company will scale first to 5 MMBtu/h and then to 10 MMBtu/h.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">A
conference call discussing the release of the Company's results for the quarter ended September 30, 2013&nbsp;is scheduled for
today,&nbsp;Monday, November 11, 2013&nbsp;at&nbsp;4:30 PM Eastern Time. To listen to the conference call, you should dial 1-800-860-2442
(international: +1-412-858-4600) five to ten minutes before the scheduled start time and request to be connected to the ClearSign
Combustion Corporation conference call. Click here&nbsp;to listen to the call online. If you wish to listen to a replay of the
conference call, you may dial 1-877-344-7529 (international: +1-412-317-0088) and enter conference ID 10036795. The replay will
be available for 7 days after the conference call.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black"><B>&nbsp;</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black"><B>About
ClearSign Combustion Corporation</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white"><FONT STYLE="color: Black">ClearSign
Combustion Corporation designs and develops technologies that aim to improve key performance characteristics of combustion systems
including energy efficiency, emissions control, and fuel flexibility and overall cost effectiveness.&nbsp; Our primary technologies
include our Electrodynamic Combustion Control&trade; (ECC&trade;) and Duplex&trade; platform technologies that improve control
of flame shape and heat transfer and optimizes the complex chemical reactions that occur during combustion in order to minimize
harmful emissions. For more information about the Company, please visitwww.clearsign.com</FONT></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"></P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black"><B>Cautionary
note on forward-looking statements</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">This
press release includes forward-looking information and statements within the meaning of the Private Securities Litigation<B>&nbsp;</B>Reform
Act of 1995 and the provisions of Section&nbsp;27A of the Securities Act of 1933, as<B>&nbsp;</B>amended, and Section&nbsp;21E
of the Securities Exchange Act of 1934, as amended. Except for historical information contained in this release, statements in
this release may constitute forward-looking statements regarding our assumptions, projections, expectations, targets, intentions
or beliefs about future events that are based on management's belief, as well as assumptions made by, and information currently
available to, management. While we believe that our expectations are based upon reasonable assumptions, there can be no assurances
that our goals and strategy will be realized. Numerous factors, including risks and uncertainties, may affect our actual results
and may cause results to differ materially from those expressed in forward-looking statements made by us or on our behalf. Some
of these factors include the acceptance of existing and future products, the impact of competitive products and pricing, general
business and economic conditions, and other factors detailed in our Annual Report on Form 10-K and other periodic reports filed
with the SEC. We specifically disclaim any obligation to update or revise any forward-looking statement whether as a result of
new information, future developments or otherwise.</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>


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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>ClearSign Combustion Corporation</B></FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>(a Development Stage Company)</B></FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>Statements of Operations</B></FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>(Unaudited)</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"></P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font: bold 10pt Times New Roman, Times, Serif; color: Black; text-align: center; border-bottom: Black 1pt solid">For the Three Months Ended <BR>September 30,</TD><TD STYLE="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif; color: Black">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="6" STYLE="font: bold 10pt Times New Roman, Times, Serif; color: Black; text-align: center; border-bottom: Black 1pt solid">For the Nine Months Ended <BR>September 30,</TD><TD STYLE="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif; color: Black">&nbsp;</TD><TD STYLE="font: bold 10pt Times New Roman, Times, Serif; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font: bold 10pt Times New Roman, Times, Serif; color: Black; text-align: center; padding-bottom: 1pt">For the Period from <BR>Inception <BR>(January 23, 2008) <BR>to </TD><TD STYLE="padding-bottom: 1pt; font: bold 10pt Times New Roman, Times, Serif; color: Black">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2013</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2012</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2013</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2012</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="text-align: center; border-bottom: Black 1pt solid"><B>September 30, 2013</B></TD><TD STYLE="padding-bottom: 1pt">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="width: 30%; font-size: 10pt; color: Black">Co-development revenue</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; color: Black; text-align: right">50,000</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; color: Black; text-align: right">-</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; color: Black; text-align: right">50,000</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; color: Black; text-align: right">-</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="width: 15%; font-size: 10pt; color: Black; text-align: right">50,000</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">Cost of co-development revenue</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">34,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">34,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">34,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 9.95pt">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0.125in">Gross profit</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">16,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">16,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">-</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">16,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">Operating expenses:</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0.125in">Research and development</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">470,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">331,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">1,466,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">887,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">3,174,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt">General and administrative</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">911,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">811,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">2,685,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">2,145,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">9,681,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 9.95pt">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0.125in">Total operating expenses</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">1,381,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">1,142,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">4,151,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">3,032,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">12,855,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 9.95pt">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">Loss from operations</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">(1,365,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">(1,142,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">(4,135,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">(3,032,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">(12,839,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt">Other income (expense)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">3,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">10,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">10,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">15,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">35,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 6pt">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 2.5pt">Net Loss</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(1,362,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(1,132,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(4,125,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(3,017,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(12,804,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 6pt">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">Net Loss per share</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(0.15</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(0.13</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(0.47</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(0.42</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">(2.89</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 6pt">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">Weighted average number of shares outstanding</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">8,801,402</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">8,752,015</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">8,790,801</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">7,209,133</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">4,432,985</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>ClearSign Combustion Corporation</B></FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>(a Development Stage Company)</B></FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>Balance Sheets</B></FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; margin-bottom: 0pt"><FONT STYLE="font-size: 10pt; color: Black"><B>(Unaudited)</B></FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT> <FONT STYLE="color: Black">&nbsp;</FONT></P>



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<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="border-collapse: collapse; width: 100%; font: 10pt Times New Roman, Times, Serif">
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center">September 30,</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center">December 31,</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2013</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; font-weight: bold; padding-bottom: 1pt">&nbsp;</TD>
    <TD COLSPAN="2" STYLE="font-size: 10pt; color: Black; font-weight: bold; text-align: center; border-bottom: Black 1pt solid">2012</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; font-weight: bold">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; font-weight: bold; text-decoration: underline; padding-left: 0">ASSETS</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0">Current Assets:</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="width: 72%; font-size: 10pt; color: Black; text-align: left; padding-left: 0.125in">Cash and cash equivalents</TD><TD STYLE="width: 2%; font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; color: Black; text-align: right">3,989,000</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="width: 2%; font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="width: 10%; font-size: 10pt; color: Black; text-align: right">8,027,000</TD><TD STYLE="width: 1%; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0.125in">Prepaid expenses</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">225,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">60,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0.25in">Total current assets</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">4,214,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">8,087,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0">Fixed assets, net</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">416,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">400,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0">Patents and other intangible assets</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">1,216,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">618,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0">Other assets</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">10,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">10,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 2.5pt; padding-left: 0.25in">Total Assets</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">5,856,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">9,115,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font: bold 10pt Times New Roman, Times, Serif; color: Black; text-align: left; padding-left: 0"><P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0"><FONT STYLE="color: Black"><B>&nbsp;</B></FONT></P><P STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0pt; text-align: left; margin-bottom: 0pt"><FONT STYLE="color: Black"><B><U>LIABILITIES AND STOCKHOLDERS' EQUITY</U></B></FONT></P></TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0">Current Liabilities:</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0.125in">Accounts payable</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">205,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">276,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0.125in">Accrued compensation</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">706,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">168,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0.25in">Total current liabilities</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">911,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">444,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0">Deferred rent</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">33,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">35,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total liabilities</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">944,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">479,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0">Stockholders' Equity:</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0.25in; text-indent: -0.125in">Common stock, 8,810,674 and 8,752,015 shares&nbsp;issued and outstanding at September 30, 2013 and December 31, 2012, respectively</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">1,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">1,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-left: 0.125in">Additional paid-in capital</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">17,715,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">17,314,000</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0.125in">Deficit accumulated in the development stage</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">(12,804,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">)</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">(8,679,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">)</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 1pt; padding-left: 0.25in">Total stockholders' equity</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">4,912,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 1pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="border-bottom: Black 1pt solid; font-size: 10pt; color: Black; text-align: right">8,636,000</TD><TD STYLE="padding-bottom: 1pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: White">
    <TD STYLE="font-size: 10pt; color: Black; padding-left: 0">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black">&nbsp;</TD>
    <TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: right">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
<TR STYLE="vertical-align: bottom; background-color: rgb(204,255,204)">
    <TD STYLE="font-size: 10pt; color: Black; text-align: left; padding-bottom: 2.5pt; padding-left: 0">Total Liabilities and Stockholders' Equity</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">5,856,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD><TD STYLE="font-size: 10pt; color: Black; padding-bottom: 2.5pt">&nbsp;</TD>
    <TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: left">$</TD><TD STYLE="border-bottom: Black 2.5pt double; font-size: 10pt; color: Black; text-align: right">9,115,000</TD><TD STYLE="padding-bottom: 2.5pt; font-size: 10pt; color: Black; text-align: left">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">SOURCE
ClearSign Combustion Corporation</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">&nbsp;</FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0pt 0; background-color: white; color: #373737"><FONT STYLE="color: Black">For
further information: Media Contact: Bronwyn Wallace, Hill+Knowlton Strategies, (713) 752-1929, bronwyn.wallace@hkstrategies.com,
or Investor Relations: (206) 538-2732, investors@clearsign.com</FONT></P>

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