This template should be used as a starting point and modified based on the specific circumstances of your deal as well as the needs of your organization. We’ve included annotations for your convenience that can be used for reference. This template does not, and is not intended to, provide legal advice. Please talk with a lawyer licensed to practice in your jurisdiction before using or relying on this template.

Carbon Removal Offtake Agreement between [Carbon Supplier] and [Buyer]

THIS CARBON REMOVAL OFFTAKE AGREEMENT (the “Agreement”) is made as of [Date] (the “Effective Date”) between [Carbon Supplier] (“Carbon Supplier”)¹¹ and [Buyer] (“Buyer”). Carbon Supplier and Buyer may be referred to herein collectively as the “Parties,” or individually as a “Party.”

WHEREAS, the removal and storage of greenhouse gasses, including carbon dioxide (“CO₂”), from the atmosphere has been recognized as a critical component of mitigating global warming;

WHEREAS, scalable and permanent carbon removal and storage technologies and projects (“CRU Projects”) can benefit from multi-year offtake agreements;

WHEREAS, Carbon Supplier has proposed to Buyer the operation of a project intended to remove greenhouse gasses from the atmosphere, as further described in Exhibit B (Project Description) (the “Project”);

WHEREAS, Carbon Supplier wishes to sell CRUs representing Environmental Attributes associated with removal and storage of greenhouse gasses, expressed in metric tons of CO₂e, generated by the Project, and Buyer wishes to purchase CRUs generated by the Project from Carbon Supplier, in accordance with the terms of this Agreement; and

WHEREAS, the Parties desire to enter into this Agreement in order to set forth their respective rights and obligations with respect to the transactions contemplated hereby.

NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

Definitions and Interpretation

Definitions. Capitalized terms not otherwise defined in this Agreement shall have the meanings assigned to them in Exhibit A (Definitions).

Interpretation. When a reference is made in this Agreement to an Article, Section or Exhibit, such reference shall be to an Article or Section of, or an Exhibit to, this Agreement, unless otherwise indicated. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.” The words “hereof,” “hereto,” “herein,” “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement. The term “or” is not exclusive. The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply “if.” Words in this Agreement describing the singular number shall be deemed to include the plural and vice versa. Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein shall mean such agreement, instrument or statute as from time to time amended, modified or supplemented, unless otherwise specifically indicated. References to a Person are also to its permitted successors and assigns. References to “days” are to calendar days unless otherwise indicated; provided, that any action otherwise required to be taken on a day that is not a Business Day shall instead be taken on the next Business Day. Unless otherwise specifically indicated, all references to “dollars” and “$” are to U.S. dollars.

Term, Conditions Precedent [, Commercial Operation]²² and Delivery

Term. This Agreement is effective as of the Effective Date and shall continue in effect until the date that the CRUs for the final Contract Year identified in Exhibit D (Quantity and Price by Year) have been Delivered to Buyer (the “Term”), unless earlier terminated pursuant to the terms hereof. The Term may be extended or renewed if both Parties agree in writing at least thirty (30) days in advance of the expiration of the then current Term to a specified time period for such extension or renewal. For clarity, unless otherwise agreed by the Parties, an extension or renewal of the Term shall not affect the volume of CRUs required to be Delivered or purchased under this Agreement pursuant to the applicable provisions hereof, including this Article 2.

Delivery.

Delivery Volumes. The Parties acknowledge that the Project may generate a number of CRUs in a given Contract Year that is greater than or less than the Annual CRU Target for such Contract Year. If, in connection with any such delivery volume change, the Parties agree to update Exhibit D (Quantity and Price by Year) in accordance with this Agreement, Exhibit D (Quantity and Price by Year) may be deemed replaced by such updated Exhibit D if Buyer consents to such replacement. Buyer’s “Proportionate Share” in a given Contract Year is equal to (i) the Contract Quantity for such Contract Year divided by (ii) the Annual CRU Target for such Contract Year as set forth on Exhibit D.

1. Delivery Surplus. In the event the Project generates a number of CRUs in a given Contract Year that is greater than the Annual CRU Target for such Contract Year whether due to expansions or modifications of the Project or any other reason (“Excess CRUs”), Buyer shall have the right, but not the obligation, to purchase its Proportionate Share of such Excess CRUs as set forth in Section 5.2. For the avoidance of doubt, Buyer shall have no obligation to acquire CRUs in excess of the annual or aggregate Contract Quantities set forth on Exhibit D (Quantity and Price by Year) for a given Contract Year or over the Term, respectively.

2. Delivery Shortfall. In the event the Project generates a number of CRUs in a given Contract Year that is less than the Annual CRU Target for such Contract Year (a “Delivery Shortfall”), Carbon Supplier shall deliver to Buyer its Proportionate Share of the CRUs produced in such Contract Year. For each Contract Year in which there is a Delivery Shortfall, Carbon Supplier shall provide a written explanation of such shortfall to Buyer Representative and, if requested by Buyer Representative, shall use reasonable efforts to remedy such shortfall (including, where feasible, by proposing revised Contract Quantities in subsequent Contract Years such that Buyer receives its Total Contract Quantity over the Term), subject to Buyer’s written approval in its sole discretion. In the event the Project generates a number of CRUs that results in a Minimum Quantity Deficit, Buyer may exercise its rights in accordance with Section 8.2. For the avoidance of doubt, Buyer shall have no obligation to purchase any CRUs after the expiration or termination of this Agreement in accordance with its terms, whether or not the Project generates sufficient CRUs to satisfy the Total Contract Quantity or Minimum Quantity.

1. Protocol. Carbon Supplier shall have provided to Buyer a protocol describing the metrics and methods of quantification and verification and other information applicable to the generation of CRUs under this Agreement (the “Protocol”). The Protocol shall: (i) provide an overview of the system-level boundaries for what emissions are included (and excluded) in the CRU calculation; (ii) provide for quantitative estimation, measurement, monitoring and verification of the CRUs generated by the Project; (iii) describe the sources, methods and instruments used to establish that such CRUs meet the requirements for a CRU under this Agreement using the highest verification standards that are feasible for the Project to achieve and publicly available at the time such Protocol is adopted; (iv) ensure that the CRUs do not result from, or cause, “double counting” of CRUs or other Environmental Attributes; (v) describe any uncertainties associated with net carbon removal and storage, estimate those uncertainties according to best practices, and adjust estimates of net removal and storage of the Project and the number of CRUs expected to be generated accordingly; (vi) if appropriate, include a storage monitoring plan and plan for addressing reversals; (vii) establish the procedures by which Carbon Supplier will mitigate or control any and all health and ecosystem safety risks associated with the Project; (viii) require that the Project complies with applicable Laws; (ix) incorporate the requirements of any applicable CRU Issuer; and (x) contain such other information as Buyer’s Representative may reasonably request. Carbon Supplier shall have (A) attached a preliminary form of the protocol to this agreement as of the Effective Date and (B) proposed, no later than sixty (60) days prior to the Target Commencement Date, a final form of Protocol as approved in writing by Buyer’s Representative. The final, agreed Protocol shall be delivered to Buyer and Exhibit F (Protocol) shall be deemed replaced by such Protocol.

2. CRU Issuer. The Project and CRUs to be generated from the Project shall have been approved by the applicable CRU issuer as eligible for registration on a public registry from a CRU issuer that (i) engages a third party verifier having relevant experience, capabilities, certifications and capacity to provide the services contemplated to be provided by such verifier under this Agreement, including any such services or functions required by the CRU Issuer to assess compliance with the Protocol, as applicable (a “Verifier”) and (ii) has been approved in writing by Buyer’s Representative (the “CRU Issuer”).

3. Engagement of Independent Expert. Carbon Supplier shall have entered into an agreement with an Independent Expert in a form reasonably acceptable to Buyer’s Representative.

4. Project Documents. Carbon Supplier shall have provided to Buyer [and, with respect to clause (iv) only, [relevant local regulators],]⁴⁴ the following documents, each in a form reasonably acceptable to Buyer’s Representative:

   1. A document that includes a detailed description of the planning of the Project and how it meets the requirements of the Protocol and any applicable CRU Issuer (the “Project Design Document”), together with written confirmation from the Verifier that the Verifier has approved such Project Design Document;
   2. A community benefits plan that includes (A) a detailed description of initiatives for community and labor engagement and environmental justice on an ongoing basis with relevant stakeholders, (B) a workforce development program, and (C) a diversity, equity, and inclusion (DE&I) policy and summary of plans to foster a welcoming and inclusive work environment for underrepresented groups (the “Community Benefits Plan”). The Community Benefits Plan shall be in the form outlined in Exhibit C (Community Benefits Plan);
   3. A document that sets forth the number of CRUs expected to be generated by the Project for each Contract Year during the Term (each, an “Annual CRU Target” and the sum of the Annual CRU Targets for all such Contract Years, the “Aggregate CRU Target”), together with written confirmation from the Independent Expert that the Annual CRU Targets are accurate and technically feasible [; and]
   4. [An ecosystem safety plan that includes (i) standard operating procedures for safe handling and spill prevention for feedstock, by-product, and waste materials; (ii) hazard analysis and relevant disaster management plans; (iii) decommissioning plan; (iv) potential ecosystem impacts list and thresholds for action; and (v) ongoing risk monitoring plan (the “Ecosystem Safety Plan”), to be deemed attached as Exhibit P (Ecosystem Safety Plan) when delivered to Buyer and accepted by Buyer’s Representative].⁵⁵

5. Compliance with Agreement. As of the Commencement Date, the representations and warranties of Carbon Supplier set forth herein shall be true and accurate in all material respects, and Carbon Supplier shall have complied in all material respects with all covenants and agreements of Carbon Supplier set forth herein.

6. Officer’s Certificate. Carbon Supplier shall have delivered to Buyer a certificate in the form attached hereto as Exhibit J (Form of Commencement Date Certification) signed by an authorized officer of Carbon Supplier certifying that all Conditions Precedent have been satisfied or waived and proposing a Commencement Date (the “Commencement Date Certification”).

7. [Achievement of Milestones. Carbon Supplier shall have completed each of the planning and development milestones related to the Project by the dates specified below: (i) [________________] ]⁶⁶

8. [Affiliate Projects.

   1. On [the Effective Date], [TopCo] shall have executed and provided to Buyer the agreement set forth in Exhibit [_] (Form of New Project ROFO Agreement), that provides a right of first offer to Buyer for the purchase of CRUs or other Environmental Attributes that are offered for sale by [TopCo] or any of its Affiliates during the Term of this Agreement (the “New Project ROFO Agreement”). Such execution by [TopCo] of the New Project ROFO Agreement shall satisfy the Condition Precedent set forth in this Section 2.4(h). The New Project ROFO Agreement, when executed by [TopCo] and Buyer, shall supersede the obligations of [TopCo] under Article 5 (Right of First Offer) of this Agreement (but not its successors or assigns who may become the Carbon Supplier under this Agreement pursuant to Section 7.11 (Transfer, Sale, and/or Assignment)), unless [TopCo] and Buyer agree otherwise. Upon execution of the New Project ROFO Agreement by Buyer, the executed New Project ROFO Agreement provided by [TopCo] shall be binding on [TopCo] and Buyer.⁷⁷

   2. On the Effective Date, [TopCo] shall have executed and provided to Buyer the agreement set forth in Exhibit N (Form of Guaranty) in favor of Buyer. Such execution by [TopCo] of such guaranty agreement shall satisfy the Condition Precedent set forth in this Section 2.4(h)(ii).]⁸⁸

Physical Settlement; Forward Contract. Each Party intends that (a) this Agreement and each transaction hereunder meets the criteria for the exclusion from the definition of “swap” set forth in 7 U.S.C. §1(a)(47)(B)(ii) and (b) the transactions contemplated under this Agreement be physically settled. Each Party further intends that (i) this Agreement and all transactions hereunder constitute a single integrated “forward contract” under the U.S. Bankruptcy Code, 11 U.S.C. §101(25); (ii) this Agreement constitutes a “master netting agreement” within the meaning of the U.S. Bankruptcy Code; and (iii) the remedies identified in this Agreement are “contractual rights” as provided for in 11 U.S.C. §556.

Price and Payment

Taxes and Fees. Carbon Supplier shall pay or cause to be paid all taxes and fees, including any sales, use or value added taxes, imposed by any Governmental Authority (“Governmental Charges”) on or with respect to the CRUs Delivered to Buyer under this Agreement, to the extent arising prior to or imposed upon the Delivery of CRUs to Buyer. Buyer shall pay to Carbon Supplier any such Governmental Charges that Carbon Supplier has a legal obligation to collect from Buyer provided that such amounts are identified in the invoices rendered to Buyer hereunder for CRUs Delivered in accordance with the payment procedures and deadlines set forth in Section 3.1 (Buyer Payment Obligations). Buyer shall pay or cause to be paid all Governmental Charges on or with respect to the CRUs Delivered to Buyer under this Agreement, to the extent arising following the Delivery of the CRUs to Buyer. In the event Carbon Supplier is required by Law to remit or pay Governmental Charges that are Buyer’s responsibility hereunder, Buyer shall promptly reimburse Carbon Supplier for such Governmental Charges. In the event Buyer is required by Law to remit or pay Governmental Charges which are Carbon Supplier’s responsibility hereunder, Buyer may deduct the amount of any such Governmental Charges from the sums due to Carbon Supplier under this Agreement. Nothing shall obligate a Party to pay or be liable for any Governmental Charges for which it is exempt under Law. Buyer may provide Carbon Supplier an exemption certificate or equivalent information acceptable to the relevant taxing authority, in which case, Carbon Supplier will not charge or collect the Governmental Charges covered by such certificate. Carbon Supplier will provide Buyer with any forms, documents, or certifications as may be reasonably required by Buyer to satisfy any information reporting or withholding tax obligations of Buyer with respect to any payments under this Agreement.

Representatives and Independent Expert

[Representatives. Carbon Supplier and Buyer will each appoint a representative (“Representative”) to coordinate implementation of this Agreement and communication between the Parties. The initial Representative of each of Carbon Supplier and Buyer is named in Section 10.2 (Notices). Each Party may rely upon the representations, statements and other communications, subject to this Agreement, of the other Party’s Representative as the statements of such Party. Each Party may change any identified Representative of such Party at any time by providing written notice to the other Party. Each Party is responsible for the actions or omissions of its Representatives in implementing this Agreement.]¹⁵¹⁵

Independent Expert. Carbon Supplier shall appoint, and Buyer’s Representative shall approve in writing, a third party expert, expected to be [an engineer]¹⁶¹⁶, having relevant experience, capabilities, certifications and capacity to provide the services contemplated to be provided by such [engineer]¹⁷¹⁷ under this Agreement (the “Independent Expert”). Notwithstanding any such prior approval, if Buyer’s Representative reasonably determines that the then-current Independent Expert is not performing its obligations under this Agreement in a satisfactory manner, Buyer’s Representative may terminate the appointment of such Independent Expert and replace such Independent Expert with a new firm that is mutually acceptable to the Parties. In the event the parties cannot agree on a replacement Independent Expert, a replacement Independent Expert will be determined in accordance with the dispute resolution procedure in Section 10.4 (Dispute Resolution). All costs, fees and expenses of the Independent Expert shall be borne and paid directly by Carbon Supplier. To the extent any such costs, fees and expenses are incurred by Buyer directly, Buyer shall be entitled to offset against payments due to be paid by Buyer to Carbon Supplier hereunder, or to reimbursement of such costs, fees and expenses from Carbon Supplier within thirty (30) days after such costs, fees or expenses are incurred. For the avoidance of doubt, in order to qualify as an Independent Expert hereunder, such Independent Expert must be completely independent from, and not have any separate commercial relationship with or be an Affiliate of, Carbon Supplier or any of its Affiliates and otherwise be reasonably acceptable to Buyer’s Representative.

Right of First Offer

Survival of ROFO Obligation; Application in Context of Assignment or Change of Control. [Carbon Supplier][TopCo]²⁰²⁰ acknowledges and agrees that in the event of an assignment of this Agreement and a transfer of all of the Project’s assets to an Affiliate of [Carbon Supplier] in accordance with Section 7.11 (Transfer, Sale, and/or Assignment), each of [Carbon Supplier][TopCo, Carbon Supplier,] and its Affiliates (including the applicable assignee) shall continue to be bound by the New Project ROFO set forth in Section 5.1. In addition, in the event that this Agreement is assigned by operation of law in connection with a transfer of the Project to a third party pursuant to a Change of Control of Carbon Supplier that is otherwise permitted by and complies with the terms of this Agreement, including Section 7.11 and Section 7.12 (Change of Control), the acquiring or surviving entity in such Change of Control shall continue to be bound by the Excess CRU ROFO set forth in Section 5.2 (but not, for clarity, as to any other projects or operations of the applicable third party).

Representations and Warranties

By Both Parties. Buyer and Carbon Supplier each represent and warrant to the other Party that as of the Effective Date:

1. Such Party is duly organized, validly existing, and duly qualified to conduct business in each jurisdiction where required; the execution, delivery and performance of this Agreement are within its power, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any applicable Law;

2. There is no action, claim, proceeding, order, writ, injunction, judgment or investigation outstanding or pending, or to the knowledge of such Party, threatened against or relating to such Party or the Project that would have a material adverse effect on this Agreement or the transactions contemplated hereby or such Party’s ability to perform its obligations under this Agreement;

3. Such Party is an “eligible commercial entity” and an “eligible contract participant” as defined in Sections 1a(17) and (18) of the Commodity Exchange Act, as amended (7 U.S.C. §1a), and such Party is a “forward contract merchant” within the meaning of the U.S. Bankruptcy Code, 11 U.S.C. §101(26); and

4. This Agreement is the legal, valid, and binding obligation of such Party, enforceable against such Party in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting the enforcement of creditors’ rights generally and subject to general equitable principles.

By Carbon Supplier. Carbon Supplier represents and warrants to Buyer that as of the Effective Date, the Commencement Date, [the COD,]²¹²¹ any date on which Carbon Supplier Delivers CRUs to Buyer, and any date on which Carbon Supplier sends an invoice to Buyer:

1. Carbon Supplier has good and marketable title to the Project and its assets free and clear of any liens or encumbrances not disclosed in writing to Buyer; Carbon Supplier has not infringed on any intellectual property rights of any other Person in connection with the Project; none of Carbon Supplier, its Affiliates or the Project is the subject of any pending or threatened action, suit or proceeding not disclosed in writing to Buyer prior to the Effective Date;

2. Carbon Supplier (i) is in compliance in all material respects with all Laws applicable to the Project and this Agreement, including all environmental Laws, if applicable, and (ii) has obtained and is in compliance in all material respects with the terms and conditions of all Governmental Approvals required for the present stage of development of the Project, including permits for operation, if applicable;

3. All information provided to Buyer and Buyer’s Representative by Carbon Supplier in connection with the Project or this Agreement is true, complete, and correct in all material respects and does not omit to state a material fact necessary in order to make such information not misleading;

4. Each CRU Delivered by Carbon Supplier to Buyer under this Agreement is valid, accurately represents the identity, volume, and CO₂e of greenhouse gasses removed by the Project, and complies in all material respects with the terms of this Agreement, including the requirements of the Protocol and any applicable CRU Issuer;

5. Upon Delivery by Carbon Supplier of CRUs to Buyer hereunder, Carbon Supplier will have transferred to Buyer all right, title, and interest in and to such CRUs, free and clear of any liens or encumbrances;

6. Carbon Supplier has not sold, transferred, or agreed to sell or transfer any CRUs, and none of Carbon Supplier or any of its suppliers or other partners has claimed or has any right to claim benefits represented by the CRUs, to be Delivered to Buyer under this Agreement to any other Person (excluding any such liens, collateral assignments or pledges permitted by this Agreement that, in each case, are released prior to or concurrently with such Delivery);

7. All insurance policies required to have been obtained by Carbon Supplier under this Agreement have been so obtained and are in full force and effect;

8. None of Carbon Supplier, its Affiliates, or any of its or their respective directors, officers, or employees or, to the knowledge of Carbon Supplier, its or their suppliers, partners, representatives or agents, is a government-sanctioned person or the subject or target of any government sanctions, has its assets located in a government-sanctioned country or derives revenues, directly or indirectly, from transactions with or investments in government-sanctioned persons or government-sanctioned countries, is under administrative, civil or criminal investigation for an alleged violation of, or has received notice from or made a voluntary disclosure to any governmental entity regarding a possible violation of, anti-corruption Laws, anti-money laundering Laws or sanctions by a governmental authority;

9. Carbon Supplier has implemented and maintains in effect policies and procedures designed to ensure compliance by it and its Affiliates, and its and their directors, officers, employees, suppliers, partners, representatives or agents, with all anti-money laundering Laws, anti-corruption Laws and applicable sanctions, and Carbon Supplier is in compliance with all such Laws and policies and procedures; and

10. Except as disclosed in writing to Buyer, neither Carbon Supplier nor any of its Affiliates has sold or agreed to sell CRUs to any other Person pursuant to a definitive offtake agreement entered into within the past twelve (12) months at a price per metric ton of CO₂e for a given Contract Year that is less than the CRU Price for the applicable Contract Year covered by this Agreement.

Covenants

[Third-Party Sales. Carbon Supplier shall not sell or agree to sell CRUs expected to be generated by the Project to any third party if such sale or agreement (i) would result in the aggregate commitments for the Project to exceed the Annual CRU Target for a given Contract Year (unless Carbon Supplier has notified Buyer of an increased Annual CRU Target and offered to Buyer its Proportionate Share of such increase pursuant to and in accordance with Article 5 (Right of First Offer)) or (ii) would otherwise constitute a breach of the terms of this Agreement, including Section 2.3 (Delivery Volumes) and Article 5.]²²²²

Compliance with Law. Carbon Supplier shall (a) comply, and shall cause the Project to comply, with all applicable Laws, (b) obtain, maintain and comply with all Governmental Approvals applicable to the Project and (c) provide to Governmental Authorities or any applicable third party any financial security required in connection with the Project.

Compliance with Payment Requirements. Carbon Supplier shall comply with Buyer’s Payment Provisions.

Insurance. From and after the Commencement Date and through the Term, Carbon Supplier shall obtain, hold and maintain insurance policies that satisfy the requirements set forth on Exhibit M (Insurance Requirements), except that (a) Carbon Supplier shall not be required to obtain such insurance to the extent it is not available on commercially reasonable terms, and (b) such insurance need not be maintained for the entire Term if a shorter period is specified in such Exhibit. Carbon Supplier shall provide prompt written notice to Buyer of any policy renewal, termination, cancellation or other material change to any required insurance coverage.

Books and Records; Access. Carbon Supplier shall maintain books and records reasonably sufficient to document compliance by Carbon Supplier with its obligations under this Agreement and applicable Laws and Governmental Approvals. Upon reasonable advance notice, Carbon Supplier shall provide to Buyer and its representatives such access to the Project and to Carbon Supplier’s books and records, properties, contracts, commitments and personnel as Buyer or such representatives may reasonably request. Without limiting the foregoing, Carbon Supplier acknowledges and agrees that Buyer and its Representative may utilize the Independent Expert, the CRU Issuer or other advisors for the purposes of evaluating Carbon Supplier’s performance under this Agreement and the information provided by Carbon Supplier hereunder, including the certifications, reports and other deliverables described herein, and agrees to extend such reasonable access to such experts and advisors. All access pursuant to this Section 7.8 shall be conducted in such a manner as not to interfere unreasonably with the normal operations of Carbon Supplier and shall be subject to Section 9.1 (Confidentiality).

Project Status Report; Other Documents.

1. From and after the Effective Date, Carbon Supplier shall, at the end of each quarter, provide a quarterly progress report to Buyer in a form reasonably acceptable to Buyer’s Representative (the “Project Status Report”). The Project Status Report shall include the following: (i) an overview of the progress of the Project, including the status and anticipated timing of development, construction, testing and operation of the Project, [and any milestones listed in [Section 2.4(g)]]²³²³; (ii) information regarding any material Governmental Approvals obtained or required for the development, construction, testing and operation of the Project; (iii) an evaluation of Carbon Supplier’s and the Project’s compliance with applicable Laws, Governmental Approvals and this Agreement; (iv) the status of any bond, insurance or other financial security required to be provided to Governmental Authorities or third parties with respect to the Project; (v) estimated month-by-month delivery schedule including anticipated Delivery Dates and corresponding amounts of CRUs to be Delivered on such dates for the next twelve (12) months; and (vi) any other information that is material to the Project or generation of CRUs or that Buyer’s Representative otherwise reasonably requests.

2. During the Term, upon Buyer’s written request and subject to Section 9.1 (Confidentiality), Carbon Supplier shall, at no cost or expense to Buyer, provide Buyer with copies of (a) all Project-related documents that have been prepared or verified by the CRU Issuer, Verifier, or Independent Expert, (b) any research findings or publications that are issued or produced in connection with the Project, and (c) to the extent reasonably required, other information related to the development, construction and operation of the Project, including financial models, Project schedules and material agreements with third parties.

3. Carbon Supplier shall not be required to provide to Buyer any information under this Section 7.9 the disclosure of which would breach a contract with a third party, provided that the nature of such information is disclosed to Buyer and the basis for the claim of confidentiality is substantiated by Carbon Supplier, and Carbon Supplier uses commercially reasonable efforts to obtain consent from the third party for disclosure of such information to Buyer. From and after the Effective Date, prior to agreeing to non-disclosure obligations to third parties of the type of information to be provided by Carbon Supplier to Buyer under this Section 7.9 or otherwise, Carbon Supplier shall use commercially reasonable efforts to include Buyer as a permitted recipient of such information.

Publicity.

1. Except for disclosures permitted or approved in accordance with this Section 7.10 (Publicity) and without limiting Article 9 (Confidentiality), neither Party shall disclose to any other Person the relationship between the Parties or the terms of this Agreement without the prior written consent of the other Party. For clarity, this Section 7.10 applies to all public disclosures, including packaging, promotional materials, advertisements and communications to third parties.

2. Either Party may, without consent from the other Party, disclose such information (i) to current or prospective lenders to or investors in such Party, and (ii) to other Persons with a need for such information for purposes of measurement, verification or reporting pursuant to the Protocol or any applicable CRU Issuer; provided that all such receiving parties agree (or are required by professional obligation) to maintain the confidentiality of such information in a manner materially consistent with the requirements of Section 9.1 (Confidentiality).

3. Buyer may, without consent from Carbon Supplier, (i) disclose the information set forth in Exhibit L (Permitted Disclosures) and (ii) disclose such other information that Buyer may reasonably require to disclose in order to substantiate claims Buyer may make regarding its carbon emissions removals or reductions.

4. For any disclosure by a Party requiring the prior written consent of the other Party pursuant to this Section 7.10, such Party shall share with the other Party a draft of any such proposed disclosure(s) referencing the Project, this Agreement or the transactions contemplated hereby no less than ten (10) days prior to publication for review, comment and approval by the other Party. Any such approval (i) may be withheld or given in a Party’s sole discretion, (ii) may be revoked at any time with respect to future disclosures and (iii) may be provided for particular text or content, which text or content may be used for multiple disclosures with prior written notice, as the case may be. Each Party agrees to review any request for approval under this Section 7.10 within ten (10) days after receipt.

5. Carbon Supplier hereby grants Buyer a worldwide, royalty-free, non-exclusive, non-transferable, non-sublicensable, limited license to use and display Carbon Supplier’s trademarks, service marks, logos, trade names, copyrighted content, graphic files, and images in connection with the public disclosures made in accordance with this Section 7.10.

6. Carbon Supplier may not use or display Buyer’s trademarks, service marks, logos, trade names, copyrighted content, graphic files, and images (the “Buyer Marks”) without Buyer’s prior written consent. If Buyer approves Carbon Supplier’s use of the Buyer Marks, Carbon Supplier agrees to comply with Buyer’s brand usage guidelines as may be amended from time to time.

Transfer, Sale, and/or Assignment.

1. Carbon Supplier shall not transfer, sell, or assign any assets of or interests in the Project, including any interest in real property on which the Project is located or any contracts or other attributes of the Project, whether by operation of law or otherwise, to any Person without providing at least thirty (30) days’ prior written notice to Buyer, except for Permitted Assignments (as defined below). In the event Carbon Supplier provides notice of any such transfer, sale, or assignment that is not a Permitted Assignment, Buyer may terminate the Agreement without penalty.

2. Carbon Supplier may (i) assign this Agreement and transfer all (but not less than all) of the assets of the Project to an Affiliate of Carbon Supplier, so long as such Affiliate assumes the obligations of Carbon Supplier under this Agreement and [Carbon Supplier][TopCo]²⁴²⁴ guarantees the obligations of such Affiliate in accordance with the form attached hereto as Exhibit N (Form of Guaranty), (ii) assign this Agreement by operation of law in connection with the transfer of the Project to a third party pursuant to a Change of Control of Carbon Supplier that is otherwise permitted by and complies with the terms of this Agreement, including Section 5.3 (Survival of ROFO Obligation; Application in Context of Assignment or Change of Control) and Section 7.12 (Change of Control), so long as such third party assumes in writing the obligations of Carbon Supplier under this Agreement, and (iii) collaterally assign this Agreement and the Project for purposes of direct or indirect financing of the development, construction, operation or maintenance of the Project or any refinancing thereof (each, a “Permitted Assignment”).

3. In connection with any financing of the Project described in Section 7.11(b), upon request by Carbon Supplier, Buyer agrees to cooperate with Carbon Supplier and its financing parties, except to the extent that such cooperation would materially and adversely affect Buyer or its interests in this Agreement; provided that Buyer shall not be required to furnish a legal opinion or execute any documents in connection with such financing, except for a consent to a collateral assignment substantially in the form attached hereto as Exhibit O (Form of Consent to Collateral Assignment). Carbon Supplier shall be responsible for any costs and expenses incurred by Buyer in connection with such financing cooperation. For the avoidance of doubt, this Section 7.11 shall not restrict (i) sales of CRUs or equity interests in Carbon Supplier that otherwise comply with this Agreement, or (ii) any lawful foreclosure by a secured creditor pursuant to a collateral assignment that complies with this Section 7.11.

Change of Control. Carbon Supplier shall provide Buyer with at least thirty (30) days’ prior written notice of any proposed Change of Control, whether to a Restricted Person or otherwise. In the event Carbon Supplier provides notice of a potential Change of Control with a Restricted Person in breach of this Section 7.12 and the Buyer does not agree to such Change of Control, Buyer may terminate the Agreement without penalty. For the avoidance of doubt, this Section 7.12 shall not apply to a collateral assignment of this Agreement or the Project, or any lawful foreclosure by a secured creditor pursuant to any such collateral assignment, in each case that complies with Section 7.11 (Transfer, Sale, and/or Assignment).

Exclusive Rights. Carbon Supplier understands and agrees that the CRUs are the exclusive representations of the Environmental Attributes associated with the reduction, removal or storage of greenhouse gasses, expressed in metric tons of CO₂e, associated with the Project, and that Carbon Supplier shall not sell or attempt to sell any CRU or related Environmental Attribute in any manner that would result in double counting of the CRUs or other Environmental Attributes associated with removal or storage of greenhouse gasses, expressed in metric tons of CO₂e, attributable to the Project. [For the avoidance of doubt, (a) soil carbon and soil organic carbon are Environmental Attributes, and (b) soil health attributes generated by the Project (e.g. pH adjustment, trace mineral application, and similar attributes) are not Environmental Attributes subject to the restrictions of this Section 7.13.]²⁵²⁵

Independent Parties. Nothing in this Agreement shall be construed to create an employer-employee, partnership, agency, joint venture, joint employer, or franchise relationship among or between any of the Parties or the Representatives, and each of the Parties shall, and shall cause their Representatives and Affiliates and its and their respective officers, directors, employees, representatives and agents to, refrain from making any representation or statement that could be construed as such.

Further Assurances; Cooperation. Subject to the terms and conditions of this Agreement, Carbon Supplier shall use reasonable efforts to execute and deliver any further documentation and do all things reasonably necessary to fulfill Carbon Supplier’s obligations under, and otherwise carry out, the provisions of this Agreement. Without limiting the foregoing, Carbon Supplier shall take all commercially reasonable actions, and execute and deliver all documents, reasonably required by any Tracking System or CRU Issuer, or otherwise requested by Buyer, to effectuate the transfer of title and the Delivery of the CRUs to Buyer and to enable Buyer to comply with the requirements of any applicable CRU Issuer, Tracking System or other regulatory or administrative obligations with respect to the CRUs.

[Transfer of Mitigation Outcomes. The CRUs under this Agreement are intended for use by Buyer for voluntary purposes. Buyer agrees not to use or report the CRUs acquired from the Carbon Supplier under this Agreement in a way that results in any signatory to the Paris Agreement or any other nation or other intergovernmental organization (e.g. CORSIA), excluding the country of origin of Carbon Supplier, to report or otherwise claim the right to such CRUs or the underlying removal for purposes of its Nationally Determined Contributions (as defined in the Paris Agreement) or comparable national or international climate targets, (the “Restricted Sovereign Use”).

It is the Parties’ common expectation, and the Parties agree to promote and support, that the CRU Issuer will include a mechanism that ensures that no double-counting of CRUs or the underlying physical removals as between nations can occur.

If either Party becomes aware of any claim, event, or development that purports to challenge or threaten the validity of the Restricted Sovereign Use, such Party will provide prompt notice of such claim, event or development to the other Party. In the event of any non-compliance with the Restricted Sovereign Use, the Parties will use all commercially reasonable efforts to cure any such non-compliance.]²⁶²⁶

[Ecosystem Safety Monitoring. Carbon Supplier shall (a) monitor breaches of ongoing safety protocols on at least a biannual basis, (b) track its performance against the Ecosystem Safety Plan and Community Benefits Plan, and (c) within sixty (60) days of the end of each calendar year, deliver to Buyer’s Representative an annual report summarizing the results of such monitoring and tracking, including a plan to mitigate any identified risks (an “Ecosystem Impact Data Report”); provided that, if requested by Buyer’s Representative in its commercially reasonable discretion, Carbon Supplier shall engage an Ecosystem Safety Reviewer to perform the foregoing services for one calendar year.]

Default, Termination and Remedies; Indemnity

Default. Each of the following events shall constitute an “Event of Default” under this Agreement:

1. Buyer’s failure to make any required payment (not subject to good faith dispute) when due under this Agreement, if such failure is not remedied within thirty (30) days after written notice thereof from Carbon Supplier (a “Payment Failure”);

2. Carbon Supplier’s failure to achieve [(i)] the Commencement Date by the Target Commencement Date (or any extension of such date that may be proposed by Carbon Supplier and approved by Buyer in its sole discretion, it being understood that a one-time extension of six (6) months or less that is proposed by Carbon Supplier and accompanied by a written explanation of the reason for the delay shall automatically be deemed approved) (a “Commencement Date Failure”)[ or (ii) the COD by the Target COD (or any extension of such date that may be proposed by Carbon Supplier and approved by Buyer in its sole discretion, it being understood that a one-time extension of six (6) months or less that is proposed by Carbon Supplier and accompanied by a written explanation of the reason for the delay shall automatically be deemed approved) (a “COD Failure”)];²⁷²⁷

3. Carbon Supplier’s failure to Deliver to Buyer at least the Minimum Quantity of CRUs (a “Minimum Quantity Deficit”);

4. Carbon Supplier’s material breach of any provision of this Agreement (other than a Commencement Date Failure[, COD Failure,]²⁸²⁸ or Minimum Quantity Deficit) (including, for the avoidance of doubt, a material breach of its obligation to operate the Project in accordance with the Protocol and to comply with applicable Laws and Governmental Approvals) (a “Carbon Supplier Breach”), which breach (if curable) is not cured within thirty (30) days after written notice thereof from Buyer;²⁹²⁹

5. Buyer’s material breach of any provision of this Agreement (other than a Payment Failure) (a “Buyer Breach”), which breach (if curable) is not cured within thirty (30) days after written notice thereof from Carbon Supplier;

6. [Buyer’s failure to comply with the Restricted Sovereign Use (an “RSU Breach”), if such RSU Breach is not cured within one hundred eighty (180) days from Carbon Supplier notifying Buyer in writing of such breach;]³⁰³⁰ or

7. Carbon Supplier becoming the subject of a federal or state law receivership, foreclosure, dissolution or bankruptcy proceeding, making a general assignment of its assets for the benefit of credits or having an administrator, conservator or similar official appointed with respect to it or a material portion of its assets (an “Insolvency Event”).

Certain Carbon Supplier Obligations After Termination. If (i) this Agreement is terminated by Buyer pursuant to Section 8.1 (Default) as a result of a Minimum Quantity Deficit, a Commencement Date Failure[, a COD Failure,]³⁴³⁴ or a Carbon Supplier Breach of Section 2.3 (Delivery Volumes), and (ii) during the eighteen (18) month period following such termination (the “Restricted Period”), Carbon Supplier proposes to sell CRUs or Environmental Attributes generated by the Project to a third party, Carbon Supplier shall first offer to sell to Buyer at least its Proportionate Share of the CRUs available for sale (up to the aggregate Contract Quantity of CRUs or Environmental Attributes not Delivered to Buyer prior to such termination) at the lower of (x) the CRU Price under this Agreement and (y) the CRU price proposed to be offered to such third party, with the CRU delivery and payment schedule to be mutually agreed upon by Buyer and Carbon Supplier.

Limitations on Liability. EXCEPT FOR EQUITABLE REMEDIES PROVIDED IN SECTION 8.7 OR AS OTHERWISE EXPRESSLY PROVIDED HEREIN (INCLUDING PURSUANT TO SECTIONS 8.3, 8.4 AND 8.5), IN NO EVENT WILL (A) ANY PARTY BE LIABLE FOR ANY INDIRECT, CONSEQUENTIAL OR SPECIAL DAMAGES (INCLUDING LOSS OF BUSINESS PROFITS) ARISING FROM OR RELATED TO THIS AGREEMENT, (B) CARBON SUPPLIER’S LIABILITY TO BUYER FOR BREACH OF THIS AGREEMENT EXCEED (I) PRIOR TO THE [COD]³⁵³⁵, [__]% OF THE TOTAL CONTRACT VALUE SET FORTH IN EXHIBIT D AND (II) FROM AND AFTER THE [COD], THE TOTAL CONTRACT VALUE SET FORTH IN EXHIBIT D, OR (C) BUYER’S LIABILITY TO CARBON SUPPLIER FOR BREACH OF THIS AGREEMENT EXCEED (X) IN THE CASE OF A PAYMENT FAILURE, THE AMOUNT OF ANY SUCH REQUIRED PAYMENT NOT YET MADE AND NOT SUBJECT TO GOOD FAITH DISPUTE OR (Y) IN THE CASE OF ANY OTHER BUYER BREACH (I) PRIOR TO THE [COD]³⁶³⁶, [$100,000] AND (II) FROM AND AFTER THE [COD], THE PORTION OF THE TOTAL CONTRACT VALUE THAT HAS NOT BEEN PAID TO CARBON SUPPLIER AS OF THE DATE OF SUCH BREACH FOR THE REMAINDER OF THE TERM. THE LIMITATIONS ON LIABILITY IN THIS SECTION 8.6 SHALL NOT APPLY (I) TO CLAIMS FOR BREACH OF CARBON SUPPLIER’S COVENANTS, (II) TO CARBON SUPPLIER’S INDEMNIFICATION OBLIGATIONS HEREUNDER OR (III) IN THE CASE OF A PARTY’S GROSS NEGLIGENCE, WILFUL MISCONDUCT OR FRAUD.

Equitable Remedies. The Parties agree that monetary damages may be an inadequate remedy for the breach of any of the covenants or agreements (in each case, other than payment obligations) contained in this Agreement. Accordingly, each Party shall be entitled to equitable and injunctive relief with respect to any such breach, including specific performance of such covenants or agreements, without the requirement to post a bond or other security. The rights set forth in this Section 8.7 shall be in addition to any other rights the non-breaching Party may have at law or in equity.

Confidentiality

Confidentiality.

1. “Confidential Information” means (i) any information, data, reports, analyses, compilations, studies, interpretations, forecasts, records and other materials, whether oral, written or in any other form, concerning Carbon Supplier, Buyer, or any of their Affiliates or Representatives, that one Party or its Representatives (the “Disclosing Party”) provides to the other Party or its Representatives (the “Receiving Party”) in connection with this Agreement and (ii) the terms of this Agreement and any discussions or negotiations between the Parties and their representatives with respect to this Agreement. Notwithstanding the foregoing, “Confidential Information” does not include information that: (A) is already known to the Receiving Party prior to disclosure by the Disclosing Party; (B) is or becomes known to the Receiving Party on a non-confidential basis from a source that, to the Receiving Party’s knowledge, is not prohibited from disclosing such information to the Receiving Party by a contractual, legal or fiduciary obligation owed to the Disclosing Party; or (C) is independently developed by the Receiving Party without reference to or reliance upon the Disclosing Party’s Confidential Information. The Receiving Party will hold in strict confidence all Confidential Information of the Disclosing Party and will not disclose any Confidential Information of the Disclosing Person to any Person other than (x) the Receiving Party’s employees, officers, directors, contractors, advisors, representatives or agents, in each case who have a need to know such information to exercise the Receiving Party’s rights or perform its obligations under this Agreement and who are subject to confidentiality obligations at least as restrictive as those contained in this Section 9.1, or (y) with the Disclosing Party’s prior written consent. In the event the Receiving Party is required to disclose any Confidential Information of the Disclosing Party by applicable Law, the Receiving Party shall provide prompt written notice thereof to the Disclosing Party (to the extent legally permitted) so that the Disclosing Party may seek a protective order or other appropriate remedy. In the event that the Disclosing Party is unable to obtain a protective order or other such remedy, the Receiving Party shall furnish only that portion of the Confidential Information of the Disclosing Party that, in the opinion of its counsel, is legally required to be disclosed, and shall exercise commercially reasonable efforts to obtain reliable assurance that confidential treatment shall be accorded such Confidential Information.

2. Notwithstanding anything herein to the contrary, information regarding the requirements of and Carbon Supplier’s performance under any Protocol or CRU Issuer shall not be considered Confidential Information hereunder.

3. A Receiving Party may use and disclose Confidential Information where required to do so in litigation, administrative, regulatory or other legal proceedings or otherwise by applicable Laws, but only after, to the extent permitted by applicable Laws, notice to the providing Party and affording the providing Party an opportunity to seek a protective order or other relief to prevent or limit disclosure of the Confidential Information. In such event, the Receiving Party shall reasonably cooperate, at the providing Party’s sole expense, in connection with the providing Party’s efforts to obtain such protective order or other relief. Further, each Party shall use all reasonable efforts to maintain the confidentiality of the Confidential Information in any litigation or administrative or regulatory proceeding or in any other instance where disclosure is required by applicable Laws, and shall promptly notify the providing Party of any attempt by a third party to obtain the Confidential Information through legal process or otherwise.

Miscellaneous

Survival. The following provisions shall survive the expiration or earlier termination of this Agreement: Article 3 (Price and Payment), Article 6 (Representations and Warranties), Section 7.2 (Compliance with Protocol Requirements; Protocol Changes), Section 7.3 (Compliance with CRU Issuer Requirements; CRU Issuer Changes), Section 7.10 (Publicity), Article 8 (Default, Termination and Remedies; Indemnity), Article 9 (Confidentiality) (for a period of five (5) years following such expiration or termination) and Article 10 (Miscellaneous). For clarity, such expiration or termination shall not relieve a Party from obligations arising prior to the effective date of such expiration or termination, including, in the case of Buyer, the obligation to pay the Contract Price for validly Delivered CRUs for which payment remains outstanding (but not for any other CRUs).

Notices. All notices, requests, claims, demands and other communications under this Agreement shall be in writing and shall be deemed given if (i) delivered in person or by electronic mail (which is confirmed) or sent by overnight courier (providing proof of delivery) to the Parties at the following addresses (or at such other address for a Party as shall be specified by like notice) and (ii) in the case of notices given by Carbon Supplier, also posted in any online data room hosted by or on behalf of Buyer or its Representative that Carbon Supplier has been invited to use:

If to Buyer:

If to Carbon Supplier:

Governing Law and Venue. This Agreement shall be interpreted, construed and governed by the Laws of the State of New York and shall be enforced in courts located in New York, New York.

Dispute Resolution. In the event of any dispute, claim or controversy arising out of or relating to this Agreement, the Representatives will meet to resolve such dispute, claim or controversy within seven (7) days after the written request of any Representative. The Parties and their respective Representatives will cooperate in good faith to resolve such dispute, claim or controversy. If any such dispute, claim or controversy cannot be resolved within thirty (30) days after the initial meeting of the Representatives, either Party may refer such dispute, claim or controversy to arbitration. Any dispute, claim or controversy arising out of or relating to this Agreement, or the breach, termination, enforcement, interpretation or validity thereof, shall be finally determined by arbitration in New York, New York before three arbitrator(s). The arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures and in accordance with the Expedited Procedures in those Rules, except that in the case of a Carbon Supplier not located in or organized under the laws applicable in North America, the applicable rules shall be the JAMS International Arbitration Rules. Judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. This Section 10.4 shall not preclude a Party from seeking provisional remedies in aid of arbitration from a court of appropriate jurisdiction.

Assignment. Neither Party shall assign, transfer, license or sublicense its rights under this Agreement (or any right granted herein) without the prior written consent of the other Party, except that (a) Buyer, upon written notice to Carbon Supplier, may assign this Agreement to (i) any Affiliate of Buyer or (ii) any other Person that (x) has a Moody’s rating of Baa3 or higher or S&P rating of BBB- or higher or (y) otherwise satisfies creditworthiness standards reasonably acceptable to Carbon Supplier, and in each case that assumes in writing the obligations of Buyer under this Agreement, and (b) Carbon Supplier, upon written notice to Buyer, may assign this Agreement solely to the extent permitted by and in accordance with Section 7.11 (Transfer, Sale, and/or Assignment) or Section 7.12 (Change of Control), as applicable.

Entire Agreement; Severability. This Agreement sets forth the entire understanding of the Parties, and supersedes any and all prior and contemporaneous agreements and understandings, relating to the subject matter hereof. Upon a determination that any term or other provision is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible to the fullest extent permitted by applicable Law to the end that the transactions contemplated hereby are fulfilled to the extent possible.

Amendments, Waivers, and Consents. [Any amendment or waiver of this Agreement must be in writing and signed by Carbon Supplier and Buyer. Any consent or approval given by Buyer or Buyer’s Representative under this Agreement must be in writing, which may be via email if delivered in accordance with Section 10.2 (Notices).]³⁷³⁷ The waiver or failure of either Party to exercise any right provided for herein will not be deemed a waiver of any further right hereunder. Except as expressly set forth herein, the rights and remedies of the Parties set forth in this Agreement are in addition to any rights or remedies the Parties may otherwise have at law or in equity.

Counterparts. This Agreement may be executed in two or more counterparts (which may be delivered electronically), each of which shall be deemed an original and all of which together shall constitute one and the same agreement.

Force Majeure. Except as expressly provided herein, neither Party shall be considered in default under this Agreement for any delay or failure to perform any of its obligations under this Agreement, to the extent that such delay or failure results from an event of Force Majeure. A Party may rely on a claim of Force Majeure to excuse its performance only to the extent that such Party: (a) provides prompt written notice (within ten (10) days) of such Force Majeure event to the other Party, giving an estimate of its expected duration and the probable impact on the performance of its obligations under this Agreement; (b) exercises all reasonable efforts to continue to perform its obligations under this Agreement and mitigate or limit any damages to the other Party; (c) expeditiously takes action to correct or cure the event or condition excusing performance so that the suspension of performance is no greater in scope and no longer in duration than necessary; and (d) provides prompt written notice (within ten (10) days) to the other Party of the cessation of the event or condition giving rise to its excuse from performance. In connection with any failure by Carbon Supplier to perform obligations hereunder for a period of one hundred eighty (180) days after the date notice of a Force Majeure event is given (or required to have been given), Buyer shall have a right to terminate this Agreement any time upon written notice to Carbon Supplier and without any further obligation to Carbon Supplier.

Costs and Expenses. Except as otherwise explicitly provided in this Agreement, all fees and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the Party incurring such fees and expenses.

Project Site Visits. During the Term, Buyer may request reasonable, periodic site visits upon advance notice to Carbon Supplier. Carbon Supplier shall accommodate any and all reasonable requests of Buyer with respect to such visits; provided that Buyer shall comply with all Carbon Supplier health and safety policies and procedures and instructions while present at the Project site and shall conduct itself in a manner that will not unreasonably interfere with or disrupt the operation of the Project or other activities of Carbon Supplier and its subcontractors.

 
Signature page follows  
 
 

IN WITNESS WHEREOF, the undersigned have caused this Agreement to be executed as of the Effective Date.

[Acknowledged and agreed solely with respect to Article 5 hereof:]³⁸³⁸

Exhibit A

Definitions

“Affiliate” means, with respect to any Person, another Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with such first Person, where “control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management policies of a person, whether through the ownership of voting securities, by contract, as trustee or executor, or otherwise.

“Aggregate CRU Target” has the meaning set forth in Section 2.4(d)(iii).

“Agreement” means this Carbon Removal Offtake Agreement, as amended or supplemented from time to time in accordance with its terms.

“Annual CRU Target” has the meaning set forth in Section 2.4(d)(iii).

“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by Law to close.

“Buyer” has the meaning set forth in the first paragraph of this Agreement.

“Buyer Breach” has the meaning set forth in Section 8.1(e).

“Buyer Indemnified Parties” has the meaning set forth in Section 8.5.

“Buyer Marks” has the meaning set forth in Section 7.10(f).

“Carbon Supplier” has the meaning set forth in the first paragraph of this Agreement.

“Carbon Supplier Breach” has the meaning set forth in Section 8.1(d).

“Change of Control” means, with respect to Carbon Supplier, (a) the sale, lease, transfer, exclusive license or other disposition, in a transaction or a series of transactions, of all or substantially all of the assets of Carbon Supplier to any other Person or group of Persons, or (b) the consummation of a transaction or a series of related transactions, the result of which is that any Person or group of Persons becomes the direct or indirect owner of fifty percent (50%) or more of the equity interests of Carbon Supplier, measured by voting power, or gains the ability to exercise operational or management control of Carbon Supplier (and which Person or group of Persons did not hold such voting power or exercise such control immediately prior to such transactions).

“CO₂” has the meaning set forth in the recitals to this Agreement.

“CO₂e” means the CO₂ equivalent impact of a greenhouse gas.

[“COD” has the meaning set forth in Section 2.6.

“COD Certification” has the meaning set forth in Section 2.6.

“COD Failure” has the meaning set forth in Section 8.1(b).]³⁹³⁹

“Commencement Date” means the date on which the Conditions Precedent have been satisfied (or, in the sole discretion of Buyer, waived, in whole or in part) in accordance with Section 2.4 and Section 2.5.

“Commencement Date Certification” has the meaning set forth in Section 2.4(f).

“Commencement Date Failure” has the meaning set forth in Section 8.1(b).

[“Commercial Operation” means the state of the Project that corresponds to the completion of construction and the beginning of the operation of the Project, such that Carbon Supplier is demonstrably able to produce and Deliver CRUs generated by the Project to Buyer pursuant to the terms of this Agreement.]⁴⁰⁴⁰

“Community Benefits Plan” has the meaning set forth in Section 2.4(d)(ii).

“Conditions Precedent” has the meaning set forth in Section 2.4.

“Confidential Information” has the meaning set forth in Section 9.1(a).

“Contract Price” has the meaning set forth in Section 3.1.

“Contract Quantity” has the meaning set forth in Section 2.2(a).

“Contract Value” means an amount equal to the Contract Price multiplied by the portion of the Contract Quantity Delivered to Buyer.

“Contract Year” means a calendar year or portion thereof in which CRUs are to be Delivered to Buyer hereunder, including any partial calendar year from the [COD]⁴¹⁴¹ to December 31 of the calendar year in which the [COD]⁴²⁴² occurs, and any partial calendar year occurring from and after January 1 of the year in which the Term expires or this Agreement is earlier terminated in accordance with its terms.

“CRU” means a unit representing the net capture, fixation, mineralization, removal and storage of one (1) metric ton of CO₂e of greenhouse gasses from the atmosphere, all of which must be (a) Permanent, (b) verified and documented pursuant to a protocol, and (c) verified and registered by any applicable project registry.

“CRU Certification” has the meaning set forth in Section 2.2(b).

“CRU Issuer” has the meaning set forth in Section 2.4(b).

“CRU Price” means the amount expressed in dollars per CRU set forth in Exhibit D (Quantity and Price by Year) under the heading “CRU Price ($ / CRU)”.

“CRU Projects” has the meaning set forth in the recitals to this Agreement.

“Deliver” or “Delivered” or “Delivery” means the transfer of CRUs from Carbon Supplier to Buyer in accordance with this Agreement (or retirement of such CRUs at Buyer’s direction as contemplated under Section 2.2(b)), together with recognition by any applicable Tracking System that such transfer or retirement has been completed.

“Delivery Date” means any day that Carbon Supplier makes a Delivery to Buyer during the period from January 1 through and including December 1 of any Contract Year; provided that Carbon Supplier shall not make more than one Delivery in any calendar month.

“Delivery Shortfall” has the meaning set forth in Section 2.3(b) of this Agreement.

“Disclosing Party” has the meaning set forth in Section 9.1(a).

[“Ecosystem Impact Data Report” has the meaning set forth in Section 7.17 of this Agreement.

“Ecosystem Safety Plan” has the meaning set forth in Section 2.4(d)(iv) of this Agreement.

“Ecosystem Safety Reviewer” means a third party review body acceptable to Buyer’s Representative having the relevant experience, capabilities, certifications, and capacity to provide the ecosystem safety monitoring services set out in Section 7.17.]⁴³⁴³

“Effective Date” has the meaning set forth in the first paragraph of this Agreement.

“Environmental Attribute” means the environmental and other attributes as may exist from time to time, including (i) any and all credits, benefits, emissions reductions, offsets, removals, storage, and allowances, howsoever entitled, attributable to the Project, and its removal and storage of emissions of CO₂ and other greenhouse gasses that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by Law, to contribute to the actual or potential threat of altering the earth’s climate by trapping heat in the atmosphere, and (ii) any reductions, credits, benefits, allowances, transferred mitigation outcomes or corresponding adjustments resulting from or related to the Project and its implementation pursuant to the laws, rules and standards of the United Nations Framework Convention on Climate Change, including the Paris Agreement and Article 6.2 and 6.4 rulebooks. Environmental Attributes include all CRUs and any and all aspects of a CRU but do not include tax credits or rebates available under applicable Law in the United States or attributes of the Project, the Project site or its operation that constitute a potential source of liability or any adverse wildlife or environmental impacts.

“Event of Default” has the meaning set forth in Section 8.1.

“Excess CRU Price” has the meaning set forth in Section 5.2(a).

“Excess CRU ROFO” has the meaning set forth in Section 5.2(a).

“Excess CRU ROFO Deadline” has the meaning set forth in Section 5.2(b)(ii).

“Excess CRUs” has the meaning set forth in Section 2.3(a).

[“Financial Closing” means the execution and effectiveness of one or more definitive agreements that provide the debt and/or equity financing necessary to construct and complete the entire Project.]⁴⁴⁴⁴

“Force Majeure” means an event or circumstance that materially adversely affects the ability of a Party to perform its obligations under this Agreement, which event or circumstance (a) was not reasonably anticipated or foreseeable, (b) is not attributable to fault or negligence on the part of that Party, (c) is caused by factors beyond that Party’s reasonable control, and (d) for which, despite the exercise of due diligence and all commercially reasonable precautions and measures to prevent, avoid, mitigate or overcome such event or circumstance, the affected Party has been unable to prevent, avoid, mitigate or overcome such event or circumstance. Force Majeure does not include (i) changing economic, market or industry conditions, (ii) the failure to enter into or perform commercial agreements with third parties (including the failure to obtain financing) or (iii) the failure to obtain Governmental Approvals. Force Majeure shall include, to the extent that such event or condition also satisfies clauses (a) through (d) above, action of a Governmental Authority (including a change in applicable Law but excluding a failure to obtain any Governmental Approval required for the Project) that prevents or prohibits Carbon Supplier from operating the Project, selling or producing CRUs or otherwise performing its obligations hereunder.

“Governmental Approvals” means any permits, consistency determinations, certifications, licenses, approvals, consents, registrations, privileges, franchises, memberships, certificates, entitlements, grants, leases and other authorizations issued by Governmental Authorities.

“Governmental Authority” means any international, federal, regional, state, provincial, local, municipal, governmental, administrative, judicial, or government-owned body, commission, authority, tribunal, court, agency or entity making decisions with the force of Law.

“Governmental Charges” has the meaning set forth in Section 3.3.

“Independent Expert” has the meaning set forth in Section 4.2.

“Insolvency Event” has the meaning set forth in [Section 8.1(g)].

“Law” means all legally binding statutes, laws, ordinances, rules, regulations, orders, judgments, decrees, injunctions and writs of any Governmental Authority that apply to the Project, CRUs or any one or both of the Parties, or the terms hereof, including common law principles. For the avoidance of doubt, Laws includes the Foreign Corrupt Practices Act of 1977, as amended, along with any similar or analogous law.

“Maximum Verification and Registry Cost” has the meaning set forth in Section 3.1(b).

“Minimum Quantity” means a number of CRUs equal to [[_____ percent (__%)] of the Total Contract Quantity, achieved in one or more Contract Years within the first two (2) calendar years of the Term] [(a) [_____], with respect to [the first Contract Year], (b) [_____], with respect to [the second Contract Year], and (c) [_____], with respect to [the third Contract Year]].⁴⁵⁴⁵

“Minimum Quantity Deficit” has the meaning set forth in Section 8.1(c).

“New CRUs” has the meaning set forth in Section 5.2(a).

“New CRU Price” has the meaning set forth in Section 5.2(a).

“New Project” has the meaning set forth in Section 5.1(a).

“New Project Agreement” has the meaning set forth in Section 5.1(b)(ii).

“New Project CRUs” has the meaning set forth in Section 5.1(a).

“New Project CRU Price” has the meaning set forth in Section 5.1(a).

“New Project ROFO” has the meaning set forth in Section 5.1(a).

[“New Project ROFO Agreement” has the meaning set forth in Section 2.4(h).]⁴⁶⁴⁶

“New Project ROFO Deadline” has the meaning set forth in Section 5.1(b)(ii).

“Paris Agreement” means the international treaty on climate change adopted at the United Nations Framework Convention on Climate Change in 2015 and entered into in 2016.

“Party” and “Parties” have the meaning set forth in the recitals to this Agreement.

“Payment Failure” has the meaning set forth in Section 8.1(a).

“Payment Provisions” means Buyer’s payment requirements set forth in Exhibit I (Payment Provisions).

“Permanent” means removal from the atmosphere and storage for at least 1,000 years.

“Permitted Assignment” has the meaning set forth in Section 7.11(b).

“Person” means any natural person or any entity or organization legally recognized as a separate entity, such as a limited liability company, partnership, corporation or non-profit organization.

“Project” has the meaning set forth in the recitals to this Agreement.

“Project Design Document” has the meaning set forth in Section 2.4(d)(i).

“Project Status Report” has the meaning set forth in Section 7.9(a).

“Proportionate Share” has the meaning set forth in Section 2.3.

“Proposed Project Agreement” has the meaning set forth in Section 5.1(b).

“Protocol” has the meaning set forth in Section 2.4(a).

“Protocol Change Request” has the meaning set forth in Section 7.3(a).

“Receiving Party” has the meaning set forth in Section 9.1(a).

“Representative” has the meaning set forth in Section 4.1.

“Restricted Period” has the meaning set forth in Section 8.4.

“Restricted Person” means a Person that does not have, or has not retained a Person with, reasonable experience in the operation and maintenance of relevant facilities or is (a) a competitor of Buyer, (b) engaged as its primary business in oil and gas exploration, production, transportation, storage, refining, marketing or investing, (c) on (or affiliated with any Person on) the Office of Foreign Assets Control Sanctions List, or (d) held liable (or for which its senior executives are held liable) criminally or for fraud under any applicable Law.

[“Restricted Sovereign Use” has the meaning set forth in Section 7.16 of this Agreement.]⁴⁷⁴⁷

“ROFO Acceptance Notice” has the meaning set forth in Section 5.1(b)(ii).

“ROFO Notice” has the meaning set forth in Section 5.1(b).

“ROFO Share” has the meaning set forth in Section 5.1(a) or Section 5.2(a), as appropriate.

[“RSU Breach” has the meaning set forth in Section 8.1(f).]⁴⁸⁴⁸

[“Target COD” has the meaning set forth in Section 2.6.]⁴⁹⁴⁹

“Target Commencement Date” has the meaning set forth in Section 2.4.

“Term” has the meaning set forth in Section 2.1.

“Total Contract Quantity” means the sum of the Contract Quantity for each Contract Year of the Term, as set forth in Exhibit D (Quantity and Price by Year).

“Tracking System” means the tracking system used by the CRU Issuer, if any.

“Verification and Registry Costs” has the meaning set forth in Section 3.1(b).

“Verifier” has the meaning set forth in Section 2.4(b).

Exhibit C

Template for Community Benefits Plan

This template is intended to provide helpful information to assist applicants in developing a community benefits plan for carbon dioxide removal offtake agreements. The plan should be no more than 5 pages long.

The rationale for developing a community benefits plan (CBP) for each relevant deployment site is threefold: 1) normative: engaging communities and designing projects that maximize societal benefits is the right thing to do; 2) instrumental: a failure to appropriately engage communities and design responsible projects can result in backlash and delayed/terminated efforts; and 3) substantive: communities often have insights into the kinds of research questions that are relevant that can escape the narrow view of experts, so early engagement can improve project design and outcomes.⁵⁰⁵⁰

Our expectation is not that a CBP is complete at commencement of the contract, but that a) meaningful progress has been made already, and the applicant has demonstrated both a commitment to delivering benefits to communities and a commitment to be responsive to community input; and b) the applicant has a plan to finalize a robust CBP as a deliverable for each relevant deployment site ideally before deployment.

Our template is very aligned with the US Department of Energy’s requirements for CBPs, as we expect these to be table stakes for the CDR industry. This means focusing on four pillars: 1) community and labor engagement; 2) workforce development; 3) diversity, equity, access, and inclusion (DEIA); and 4) environmental justice.

There is no universal formula for developing good CBPs that would apply to all CDR projects, but this template is meant to ensure that applicants are addressing relevant issues and have established effective processes.

1. Community and labor engagement plan: This section should describe plans (not ad hoc efforts) to engage with stakeholders and/or groups in the communities most impacted by the deployment of your approach. This could include host communities, labor unions representing workers, trades needed for construction and operations, community-based organizations, local residents and businesses, local governments, etc. There is no “right” way to develop an engagement plan, but some ideas include: identify impacted stakeholders; identify goals for engagement; choose methods for engagement and prepare a timeline; identify who is responsible for overseeing engagement (e.g., which staff person, organization, etc.).

   Please make sure that your plan describes:

   1. 1. How stakeholders will be identified
      2. What methods will be used to engage stakeholders
      3. Plans to communicate / give access on project impacts to interested parties
      4. What methods will be used to incorporate community feedback and improve engagement
      5. Any timelines for negotiating workforce and/or community agreements

   2. Background: A brief description of previous efforts to engage communities, labor, and other stakeholder groups with a focus on those most impacted by the project

   3. Community assessment: A brief summary of the relevant current and historical social, cultural, economic, labor, and environmental landscape of the project.

   4. Initial stakeholder analysis: A brief summary of specific stakeholder groups relevant to the project.

   5. Engagement methods and timelines: Describe the methods and timelines for engaging with stakeholders that fit with the proposed project. This could be one chart, but should include milestones (e.g., “by month 3, host a listening session with at least 10 community-based groups).

   6. Two-way engagement statement: Make clear that there are areas where engagement can impact project decisions or characteristics (e.g., “we will use input from listening session 1 to inform the location of proposed deployment A”).

   7. Workforce and community agreements: Describe any plans to negotiate workforce and community agreements. If there are opportunities for co-ownership or community stake, include that here.

2. Workforce development plan: This section should describe plans for quality job creation, inclusive recruitment and hiring, workplace safety, and investment in worker training.

   1. Background: Describe previous efforts to provide good pay and benefits to workers, support the rights of workers to have a free and fair chance to join a union, etc.
   2. Job quantity: Please describe the number and type of jobs you anticipate will be created by this proposed offtake.
   3. Quality jobs: Describe plans to attract, train, and retain a skilled and diverse workforce.
   4. Workforce development: Describe plans to invest in workforce education, training, etc. This requires understanding local labor force and project needs.
   5. Worker rights: Describe steps to support the rights of workers, including to join a union, ensure project success, and address health and safety. Include discussion of any project labor agreements or community workforce agreements.
   6. Timeline and milestones: Describe methods and timelines for ensuring workforce development.

3. Diversity, equity, inclusion plan: Describe plans to foster a welcoming and inclusive environment and support participation from groups underrepresented in relevant fields.

   1. Background: Describe efforts relevant to DEIA, including efforts related to suppliers, partners, etc.

   2. Strategies, milestones, timeline: Describe targeted outcomes and implementation strategies.

4. Environmental justice plan: Describe any plans to address energy and environmental justice. Environmental justice addresses how benefits and harms are distributed among groups (distributive justice) and whether there is meaningful involvement in decision-making (procedural justice). For definitions of disadvantaged communities, particularly in the US, see the White House Council on Environmental Quality’s Climate and Economic Justice Screening Tool. This section can draw heavily on the information/characterization in the earlier sections.

   1. Assessment: Describe all relevant impacted communities associated with the project, including which–if any–are disadvantaged. Characterize existing burdens faced (e.g., use the EPA’s EJSCREEN tool, or state-level screening tools; engage with communities to understand existing burdens). Assess benefits and where they flow (e.g., decreased environmental exposure; increased access to capital; increased jobs/job training; etc.) Assess negative impacts (ecological, aesthetic, cultural, economic, etc.). Be sure to assess how negative impacts interact with existing cumulative burdens.

   2. Implementation strategy: Develop a strategy that includes steps to implement energy and environmental justice efforts, advance positive outcomes, and minimize harms. This should include milestones and timelines.

Exhibit F

Protocol

[Preliminary protocol to be attached at signing.]

Exhibit G

Form of ROFO Notice

Re: