CONTRIBUTION AGREEMENT THIS AGREEMENT dated ... - ccemc

CONTRIBUTION AGREEMENTTHIS AGREEMENT dated the day of , 2013BETWEEN:WHEREAS:CLIMATE CHANGE AND EMISSIONS MANAGEMENT (CCEMC) CORPORATIONof Edmonton, Alberta(“CCEMC”)-and-[name of Recipient](the “Recipient”)Of the First PartOf the Second PartA. The Recipient has proposed to CCEMC the Project described in this Agreement;B. CCEMC is offering the Recipient a financial contribution for the Project; andC. The Recipient wishes to accept the financial contribution under the terms and conditionsset out in this Agreement.NOW THEREFORE, in consideration of the mutual promises and payments madeherein, the receipt and sufficiency of which is hereby acknowledged, the Parties agree asfollows:1. INTERPRETATION1.1 DefinitionsUnless otherwise defined herein, the following terms shall have the following meanings:(a)(b)(c)“Agreement” means this agreement together with all schedules and attachmentsand all amendments made in writing between the Parties;“Background Technology” means any Intellectual Property in respect of theProject that pre-dates the Term;“Benefit to Alberta” means the reduction of emissions of greenhouse gases andimproving the ability to adapt to climate change in Alberta, together withincremental Canadian economic activity and improved quality of life in Alberta;

- 3 -(u)“Intellectual Property” includes all materials, inventions, designs, specifications,patterns, models, prototypes, devices, formulae, methods, processes, data,compilations of information, reports, drawings, plans, photographs, musicalworks, computer software and programming patents or patent applications;(v) “Invoiced Amounts” has the meaning set forth in section 1 of Schedule B;(w)“Major Change” means a Change that includes(i)(ii)(iii)(iv)changing the model or vendor of equipment to be purchased for theProject,altering the timing of sub-tasks without changing the timing of the WorkPlan,variations of up to 15 percent in the spending profile that do not require achange to the Payment Schedule or the Project Financing Schedule, orreallocating funds from one budget item to another (for example,spending more on equipment costs and less on labour costs);(x)“Non-Confidential Final Report” has the meaning set forth in section 13 ofSchedule A;(y) “Notice” has the meaning set forth in section 15.1;(z)(aa)“Party” means either CCEMC or the Recipient and “Parties” means both ofthem;“Payment Schedule” means the schedule of payments of the Contribution asdescribed in Schedule B;(bb) “Performance Targets” has the meaning set forth in section 10 of Schedule A;(cc) ”Progress Report” has the meaning set forth in section 9 of Schedule A;(dd)(ee)(ff)(gg)(hh)“Project” means the project described in Schedule A including any changesmade in accordance with sections 3.2 and 3.3;“Project Completion Date” means the completion date of the Project asdescribed in Schedule A;“Project Costs” means those costs described in Schedule A and must includeall Eligible Expenses;“Project Financing Schedule” means the project financing schedule set forth insection 6 of Schedule A;“Project Plan” means the project plan of the Project as more specifically setforth in Schedule A;Davis: 8418076.17

- 4 -(ii)(jj)(kk)“Project Scope” means the scope of the Project as more specifically set forth inSchedule A;“Project Start Date” means the date set forth in Schedule A as the earliest dateon which the Recipient can begin incurring Project Costs;“Project Technology” means the Intellectual Property relating to the Projectcreated in the course of the Project, but excludes the Background Technologyand the Non-Confidential Final Report;(ll) “Recipient Liaison” means the person set forth in Schedule D;(mm) “Remedy Notice” has the meaning set forth in section 10.2;(nn) “Reporting Period” has the meaning set forth in section 1 of Schedule B;(oo)(pp)“Reports” means the interim and final reports described in Schedule A, but forcertainty does not include the Non-Confidential Final Report or the VerificationReport;“Senior Officials”, in the case of CCEMC means the Managing Director ofCCEMC or such other person as CCEMC may appoint from time to time, and inthe case of the Recipient means the Recipient Liaison or such other person asthe Recipient may appoint from time to time;(qq) “Steering Committee” has the meaning set forth in section 5.1;(rr) “Technology Transfer Plan” has the meaning set forth in section 8.3;(ss)(tt)“Term” means the period during which the Project shall be conducted from theProject Start Date to and including the Project Completion Date and includes anyextension agreed to by CCEMC in accordance with section ;“Total Project Value” has the meaning set forth in section 4 of Schedule “A”;(uu) “Verification” has the meaning set forth at section 18 of Schedule A;(vv) “Verification Report” has the meaning set forth in Schedule A;(ww)“Very Major Change” means a Change that includes(i)(ii)a complete shift in the direction or outputs of the Project, andabandoning one of the major lines of enquiry; and(xx)“Work Plan” means the work plan of the Project described at section 7 ofSchedule A.1.2 In this Agreement, unless the context requires otherwise:(a)words importing a gender include all genders;Davis: 8418076.17

- 5 -(b)(c)(d)(e)(f)words importing the singular include the plural and vice versa;include or including means include or including without limitation;any references to dollars or currency are to Canadian dollars ($CAD);any technical or industry specific words or phrases not otherwise defined hereinshall have the meaning ascribed to such terms in the industry in which they arenormally applied or used; andany references to legislation or regulations include any amendments thereto orsuccessor legislation or regulations.1.3 The following schedules are incorporated in and form a part of this Agreement.Schedule A - Project Scope, Budget, Project Plan and ReportsSchedule B - Payment ScheduleSchedule C - CCEMC Conflict of Interest PolicySchedule D - CCEMC Project Advisor and Recipient Liaison1.4 In the event of any inconsistency or conflict between the Schedules and the body of thisAgreement, the body of this Agreement shall govern.1.5 This Agreement, including the Schedules hereto, constitutes the entire agreementbetween CCEMC and the Recipient with respect to the Project and the Contribution, andsupersedes all previous agreements, negotiations and understandings. There are noagreements, representations, warranties, terms, conditions or commitments except asexpressed in this Agreement.1.6 No amendment made to this Agreement is valid unless it is incorporated into theAgreement in writing and the amendment is signed by the Parties hereto.1.7 The Recipient may not assign this Agreement, in whole or in part, without the writtenconsent of CCEMC, which consent shall not be unreasonably withheld. For certainty,any assignment carried out without the consent of CCEMC shall render the Agreementnull and void.2. THE CONTRIBUTION2.1 CCEMC shall provide the Recipient with a non-repayable contribution (the“Contribution”) not exceeding $ in accordance with the Payment Schedule and theProject Financing Schedule.2.2 The maximum Contribution payable shall not exceed one-third (1/3) of the Total ProjectValue.2.3 If the Total Project Value decreases then the Contribution payable by CCEMC shall beadjusted in accordance with such decrease.2.4 Subject to section 2.1, CCEMC shall pay the Contribution to the Recipient in theamounts and at the times specified in Schedule B.Davis: 8418076.17

- 6 -2.5 The obligation of CCEMC to pay the Contribution is conditional on CCEMC, actingreasonably, being and remaining satisfied that:(a)(b)(c)(d)the Recipient has received legally binding commitments or funds from thirdparties for the Project as set out in Schedule A;the Recipient is in compliance with all of its obligations under this Agreement;the Project is proceeding, continues to conform to the Work Plan and thetasks/milestones set out in section 5 of Schedule A are being completed and metand shall be completed by the Project Completion Date; andthird party commitments or funds provided by third parties for funding sufficientto carry out and complete the Project have remained in place.For greater certainty, CCEMC shall not be obligated to pay any instalments if CCEMC,in its sole discretion, believes that the Recipient or any of its officers, directors,shareholders, agents, affiliates, subsidiaries, contractors or associates are conductingtheir business and affairs in a manner that is contrary to the spirit and intent ofCCEMC’s mandate, or the terms and conditions of this Agreement.2.6 The Recipient shall use the Contribution Proceeds solely for Eligible Expenses, incurredfor the purposes of carrying out the Project as set out in Schedule A. Any portion of theContribution Proceeds expended by the Recipient other than for Eligible Expenses isimmediately repayable to CCEMC.2.7 Immediately upon receiving the Contribution Proceeds, the Recipient shall identify in itsrecords the Contribution Proceeds as being committed exclusively to the Project. Anyportion of the Contribution Proceeds that are not immediately expended by the Recipientshall be deposited into a separate interest bearing account maintained by the Recipientexclusively for the Project. Interest earned on the Contribution Proceeds must be readilyidentifiable. The Contribution Proceeds shall be held and managed by the Recipient in arisk free manner. For greater certainty, CCEMC shall not pay any interest on theContribution.2.8 The Recipient acknowledges that the Contribution shall not be sufficient to cover theentire cost of the Project and the Recipient shall be solely responsible for raising fundsfrom other sources to complete the Project.2.9 The maximum amount that CCEMC shall pay the Recipient under this Agreement is theamount of the Contribution.3. THE PROJECT3.1 The Recipient shall carry out the Project as set out in Schedule A and comply with allrequirements contained therein.3.2 The Recipient shall only make Changes to the Project in accordance with the following:(a)the Recipient must request and make a recommendation with reasons for suchChange to the Steering Committee; orDavis: 8418076.17

- 8 -5. STEERING COMMITTEE5.1 A steering committee (the “Steering Committee”) shall be established for the Project,consisting of representatives appointed by each of the Parties. CCEMC shall appointCCEMC’s representatives on the Steering Committee (the “CCEMC Project Advisor”).5.2 The Steering Committee shall(a)(b)(c)(d)(e)(f)meet with such frequency as may be required for the effective operation of theProject,monitor the progress of the Project,review the Recipient’s invoices that accompany the Reports,provide guidance about the Project regarding technical and financial matters asneeded,provide strategic direction, andmake recommendations on the Budget.5.3 Any decisions during meetings of the Steering Committee shall be made on aconsensus basis.5.4 At the beginning of each year of the Project, the Recipient shall appoint a representativeas Steering Committee chairperson (“Committee Chairperson”) from among theRecipient’s representatives with the consent of CCEMC, which consent shall not beunreasonably withheld.5.5 The Committee Chairperson shall(a)(b)(c)prepare the meeting agenda,organize and conduct the meeting, andprepare a written record of the meeting.5.6 The Committee Chairperson shall provide Notice of Steering Committee meetings to allSteering Committee members which Notice shall contain(a)(b)the date, time and location of the meeting, andan agenda.6. RECIPIENT’S REPRESENTATIONS, COVENANTS AND WARRANTIES6.1 The Recipient represents, covenants and warrants that:(a)it shall, at all times, comply with CCEMC’s “Conflict of Interest Policy”, a copy ofwhich is attached hereto as Schedule C;Davis: 8418076.17

- 9 -(b)(c)(d)(e)(f)(g)(h)(i)(j)(k)(l)(m)(n)any invoice that it presents to CCEMC for expenses incurred in completing theProject is for Eligible Expenses;it shall carry out the Project in a diligent and professional manner;it has or shall obtain the necessary financial resources to complete the Project;it has made full, true and plain disclosure to CCEMC of all facts relating to theProject that are material to this Agreement;it has, or shall obtain, all necessary licenses, permits, approvals andauthorizations, including any licenses, permits, approvals and authorizationsrequired under law, including Environmental Laws, to proceed with the Projectand to perform its obligations under this Agreement;any environmental issues or concerns relating to the Project which are known orought to be known to the Recipient have been disclosed to CCEMC, and theRecipient shall inform CCEMC of any environmental issues or concernsregarding the Project which arise during the Term;the execution by the Recipient of this Agreement and the carrying out of thisAgreement and the Project by the Recipient have been duly and validlyauthorized by the Recipient in accordance with applicable law, and thisAgreement shall constitute a binding legal obligation of the Recipient;there is presently no action, suit or proceeding being brought or pending orthreatened against or affecting the Recipient which could result in theexpropriation of any property of the Recipient or which could affect itsoperations, properties or financial condition or its ability to complete the Project;it has not entered into any agreements with other funders or sponsors in relationto the Project which conflict with the obligations of the Recipient under thisAgreement or is prejudicial to the rights of CCEMC under this Agreement;it is in compliance with all laws, orders and authorizations which relate to oraffect it and is not subject to any order of any court or other tribunal affecting itsoperations;it shall ensure that the individuals named in the Project Plan and who areemployees or contractors of the Recipient shall be assigned to or otherwiseenabled to perform their respective roles in the Project;it shall not alter the scope of the Project without prior written consent of CCEMCand in accordance with sections 3.2 and 3.3;any person who has been lobbying on behalf of the Recipient to obtain theContribution and who is required to be registered pursuant to the Lobbyists ActSA 2007, c.L-20.5 was registered pursuant to such Act at the time the lobbyingoccurred;Davis: 8418076.17

- 10 -(o)(p)(q)(r)(s)it shall not pledge any part of the Contribution as security for any loan or debt ofany kind except as expressly authorized by CCEMC in writing;if directed by CCEMC, it shall forthwith repay to CCEMC any overpayments orunexpended balances of the Contribution Proceeds, and such amounts shallconstitute a debt due to CCEMC;it shall to the satisfaction of CCEMC, acting reasonably, ensure that all ProjectCosts are incurred in a manner that is transparent, competitive and consistentwith value for money principles;it shall upload all Project information into the climate change informationmanagement system (CCIMS) within thirty (30) days after the execution of thisAgreement and on an ongoing, regular basis during the Term of this Agreement;andit shall advise CCEMC of all applications or proposals for offset credits with theGovernment of Alberta offset system in respect of the Project.7. RECORDS, REPORTING AND MONITORING7.1 During the Term and for a period of five (5) years thereafter, the Recipient shall maintainor cause to be maintained full, accurate and complete records of the activitiesconducted in furtherance of, and the results achieved through the conduct of, theProject, including full, accurate and complete records and books of account relating tothe receipt and expenditure of the Contribution and other funds received and expendedfor the purposes of the Project. Any records required to be maintained pursuant to thisAgreement are subject to the protection and access provisions of the Freedom ofInformation and Protection of Privacy Act RSA 2000 c.F-25.7.2 The Recipient shall, if requested by CCEMC, upon 30 days’ Notice, permit anyauthorized representatives of CCEMC, or auditors engaged by CCEMC, to examine theRecipients books, accounts and other records related to the Project and theContribution, and to make copies thereof. The Recipient shall provide the authorizedagents with such assistance as may be reasonably required during such an inspection.This right of inspection is limited to the purpose of ascertaining whether this Agreementhas been complied with, and CCEMC shall not have any general right to obtain custodyor copies of records in the custody of the Recipient.7.3 The Recipient shall, upon receiving Notice, permit authorized representatives of theCCEMC, to attend at the premises of the Recipient or at the place where the Project isbeing carried out, for the purpose of examining the premises and progress of theProject in order to assess whether the Recipient is in compliance with the terms of thisAgreement. The Recipient shall provide the CCEMC's authorized representatives withsuch assistance as may be reasonably required during such a site visit.7.4 The cost of any special audit, examination or report shall be payable by CCEMC, unlessthe audit, examination or report reveals non performance, non observance or breachesof this Agreement or indicates that the records and books of account were inadequate topermit a determination of how the Contribution Proceeds were used by the Recipient orDavis: 8418076.17

- 11 -what results were achieved through the conduct of the Project, in which case the costshall be borne by the Recipient.8. INTELLECTUAL PROPERTY, INNOVATION AND KNOWLEDGE TRANSFER8.1 The Recipient acknowledges the importance to CCEMC of Intellectual Property createdthrough or as a result of the Project being used to the benefit of Alberta and Albertans,including being used to reduce emissions of greenhouse gases and to improve theability to adapt to climate change in Alberta. Ownership of any Intellectual Propertydeveloped through the Project shall follow the practices of the Recipient andagreements to which the Recipient is a party.8.2 CCEMC shall keep all Reports confidential for a period of two (2) years from the ProjectCompletion date (“Confidentiality Period”), except to the extent that(a)(b)any information in the Reports becomes publically available through no fault ofCCEMC, orthe Parties agree otherwise.8.3 If the Recipient provides evidence to CCEMC that the Recipient is undertaking to protectand commercialize the Project Technology and provides a written technology transferplan (the “Technology Transfer Plan”) to CCEMC which is satisfactory to CCEMC in itssole discretion, CCEMC may, extend the Confidentiality Period to allow the Recipient toobtain patents and licences with respect to the Project Technology. If CCEMCdetermines that the proposed Technology Transfer Plan is unacceptable or for any otherreason and that it is not in the best interests of CCEMC to extend the ConfidentialityPeriod, CCEMC may choose not to do so. CCEMC may revoke any extension of theConfidentiality Period if the Recipient fails to follow the Technology Transfer Plan anddoes not correct that failure within 60 days after receiving CCEMC’s Notice of suchfailure.8.4 The Technology Transfer Plan shall contain reasonable commercial terms that are likelyto increase the probability of the Project Technology being licensed and commercializedfor use in the Province of Alberta and in accordance with the principle of Benefit toAlberta. Opportunities to commercialize Intellectual Property created through theProject shall, where feasible, be presented firstly to appropriate Alberta businesses ororganizations with suitable expertise and prior to the implementation of any TechnologyTransfer Plan consideration shall be given to the following factors:(a)(b)(c)(d)(e)(f)an existing company in Alberta with receptor capacity to commercialize;an expansion of an existing company in Alberta;the formation of a new company in Alberta;joint ventures or strategic alliances with a company in Alberta;co-manufacturing involving a company in Alberta;cross-licensing or co-development with a company in Alberta;Davis: 8418076.17

- 12 -(g)(h)establishment of a new subsidiary in Alberta; anddevelopment or production in Alberta by a foreign company.If the Recipient chooses to pursue commercialization opportunities through a foreigncompany, it must first provide CCEMC with the rationale and circumstance for suchdecision before the decision is finalized.8.5 The Recipient hereby grants CCEMC a non-exclusive, world-wide, royalty-free, nontransferable,perpetual, irrevocable, fully paid-up licence to make, use, copy, modify,display, telecommunicate, sublicense and otherwise exploit the Project Technology andReports, which shall become effective(a)(b)immediately for purposes related to research and analysis, orat the expiry of the Confidentiality Period for any other purpose if the Recipienthas not provided CCEMC with a Technology Transfer Plan that is satisfactory toCCEMC, or has not followed a Technology Transfer Plan that is satisfactory toCCEMC.8.6 At any time following the Confidentiality Period, CCEMC may publish the Reports on itspublic website, and may, from time to time, make a general public notice that suchreport has become available.8.7 The Recipient hereby grants CCEMC a non-exclusive, world-wide, royalty-free, nontransferable,perpetual, irrevocable, fully paid-up licence to make, use, copy, modify,display, telecommunicate, sublicense and otherwise exploit the Non-Confidential FinalReport, which licence shall become effective upon CCEMC’s receipt of same. At anytime following the Project Completion Date, CCEMC may publish the Non-ConfidentialFinal Report on its public website, and may, from time to time, make a general publicnotice that such report has become available.8.8 CCEMC shall make no representations or warranties regarding use of the research, theProject, the Non-Confidential Final Report or Reports by any person and provide adisclaimer, disclaiming any liability for such use.9. LIABILITIES, INDEMNITY AND INSURANCE9.1 CCEMC, its officers, directors, members, employees, contractors, affiliates, subsidiaries,partners or agents shall have no responsibility and shall not be liable whatsoever to theRecipient for any direct, indirect or consequential loss, injury or damage suffered by theRecipient as a result of the establishment or operation of the Project.9.2 The Recipient shall be liable for and indemnify and hold harmless CCEMC, its officersand directors, employees, agents, contractors and their respective officers, directorsand employees from and against any and all liabilities, claims, demands, actions andcosts (including legal costs on a solicitor-client basis) whatsoever that may arise directlyor indirectly out of any act or omission of the Recipient or its officers, directors,shareholders, employees, contractors, affiliates, subsidiaries, partners or agents inrespect of this Agreement. This indemnity and hold harmless provision shall survivethis Agreement.Davis: 8418076.17

- 13 -9.3 The Recipient shall abide by all Environmental Laws with respect to the Project andindemnify and hold harmless CCEMC, its officers and directors, employees, agents,contractors and their respective officers, directors and employees from any and allliabilities, claims, demands, actions and costs (including legal costs on a solicitor-clientbasis) whatsoever that may arise directly or indirectly out of any act or omission of theRecipient or its officers, directors, shareholders, employees, contractors, affiliates,subsidiaries, partners or agents in respect of any breach of any Environmental Laws bythe Recipient, including any reclamation or remediation costs associated with theProject. This indemnity and hold harmless provision shall survive this Agreement.9.4 The Recipient shall, at its own expenses and without limiting its liabilities herein, insureits operations:(a)(b)under a contract of General Liability Insurance in accordance with the insurancelegislation of its jurisdiction, in an amount not less than ten million dollars($10,000,000) inclusive per occurrence, insuring against bodily injury, personalinjury and property damage, including loss or use thereof, which insurance shallinclude products liability; andan all risk replacement cost policy for property that the Recipient owns or has aninsurable interest in which is used in any way in connection with the Project.CCEMC may require evidence of the required insurance in a form satisfactory toCCEMC at any time. All required insurance shall be endorsed to provide CCEMC withthirty (30) days’ Notice of cancellation or material change restricting coverage.10. NON-PERFORMANCE10.1 Each of the following events constitutes an event of default under this Agreement(“Event of Default”):(a)if, in CCEMC’s sole discretion, the Recipient(i)(ii)fails to proceed with the Project, oris not carrying out the Project;(b)(c)(d)except for Minor Changes, the Recipient alters the Project without the consent ofCCEMC;the Recipient uses any part of the Contribution Proceeds other than for theProject; orthe Recipient otherwise breaches any of its obligations pursuant to thisAgreement.10.2 Upon the occurrence of an Event of Default CCEMC may give Notice (the “RemedyNotice”) to the Recipient referring to such Event of Default and requiring the Recipientto remedy the breach within such time as CCEMC may, in its sole discretion, determine.Davis: 8418076.17

- 14 -10.3 If the Recipient fails to commence to remedy the breach within the time specified in theRemedy Notice or the Recipient fails to diligently pursue such remedy to completion,CCEMC may do any one or more of the following:(a)(b)(c)(d)terminate this Agreement immediately;demand repayment of all or any portion of the Contribution;refer any matter or dispute involving interpretation or application of any provisionof this Agreement to be resolved in accordance with section 12; orpursue any remedy available to CCEMC in law or equity.11. TERMINATION11.1 CCEMC may terminate this Agreement without cause by providing ninety (90) days’Notice to the Recipient, in which case this Agreement shall be terminated as of the dategiven in such Notice.11.2 On termination of this Agreement, CCEMC may require the Recipient to do one or moreof the following and, depending on the requirement, the Recipient shall immediately,(a)(b)(c)(d)make no further commitments for expenditures and make no furtherdisbursements from the Contribution Proceeds except with CCEMC’s priorwritten consent,transfer to CCEMC any or all Contribution Proceeds,provide an accounting of the Contribution Proceeds with an audit report settingout details of revenues and expenditures from the Contribution Proceeds fromthe date of last audited financial statements to the date of termination includingthe balance of the Contribution Proceeds remaining, andprovide any of the Reports for the portion of the Project completed up to the dateof termination.12. DISPUTE RESOLUTION12.1 In the event of any dispute regarding the interpretation or application of any provision ofthis Agreement, the Parties shall refer the matter for joint discussion by Senior Officialsof the Recipient and CCEMC. If the Senior Officials cannot resolve a dispute, theParties shall participate in mediation with a mutually acceptable mediator. Mediationshall proceed on the following basis:(a)(b)if the Parties cannot agree on a mediator, they shall ask the President orExecutive Director of the Alberta Arbitration and Mediation Society to assist inthe selection process;the Parties shall share the cost of the mediator equally and bear their own costsincurred with respect to the mediation;Davis: 8418076.17

- 15 -(c)(d)no evidence of anything said or of any admission or communication made in thecourse of the mediation shall be admissible in any legal proceeding, except withthe consent of both Parties; andany resolution reached shall be based on the full participation of and anagreement made between the Parties.13. COMMUNICATIONS13.1 The Recipient shall acknowledge the support of CCEMC in all of the Recipient’spublications, promotions or advertising that relate to the Project in the following ways:(a)(b)(c)(d)(e)in all published articles, presentations, posters, websites, signage or otherpresentation of the Project, CCEMC shall be acknowledged and the CCEMClogo must be used in conjunction with this acknowledgment;the use of CCEMC’s full name - Climate Change and Emissions Management(CCEMC) Corporation is preferred;verbal acknowledgment must be made of CCEMC support for all opportunitieswhere the Project is profiled, including lectures, tours, lab visits and mediainterviews;all media interest or inquiries to profile the Project to the media must be directedto CCEMC communications personnel and the Recipient must inform CCEMCcommunications personnel if the Project results or research shall be published ina major journal such that it might result in a press release from such journal; andone copy of all the documents, materials or presentations referred to insubsection 13.1(a) above, must be sent to CCEMC for CCEMC’s records on theProject.13.2 The Recipient shall obtain CCEMC’s written approval to publish any articles,presentations, posters, websites, signage or other presentation of the Project, whichapproval shall not be unreasonably withheld.13.3 The Recipient shall not make any public announcement or issue any press releaseregarding the entering into of this Agreement or the making of the Contribution, exceptin consultation with and approval of CCEMC as to the contents of the announcement orpress release, which approval shall not be unreasonably withheld.13.4 In the event of a significant discovery, breakthrough or achievement in relation to theProject that may merit consideration for public announcement, the Recipient shall:(a)(b)notify CCEMC in a timely manner of the discovery, breakthrough orachievement, with reasonable details;consult with CCEMC regarding the desirability of and content of a publicannouncement or press release; andDavis: 8418076.17

- 16 -(c)refrain from making any public announcement or press release except with theapproval of CCEMC as to the contents of the announcement or press release ,which approval shall not be unreasonably withheld.14. CONFIDENTIAL INFORMATION14.1 The Recipient shall not disclose any third party confidential information or document ormake use of any intellectual property rights subject-matter that it becomes aware of ortakes possession of from a third party during the implementation of the Project, withouthaving obtained written authorization from the third party releasing it from the obligationof confidentiality, and the Recipient shall ensure that all of its employees,representatives, delegates, agents, consultants or subcontractors act accordingly. Uponrequest of CCEMC, the Recipient shall provide CCEMC with a copy of the authorizationobtained.14.2 The Recipient shall not disclose any confidential information or document nor make useof any intellectual property rights subject-matter that it becomes aware of or takespossession of during the implementation of the Project regarding CCEMC or providedby CCEMC, without first having obtained written permission from CCEMC, and theRecipient shall ensure that all of its employees, representatives, delegates, agents,consultants or subcontractors act accordingly.15. NOTICES15.1 Any notices, approvals, consents and other communication under this Agreement shallbe in writing (each such communication being a form of “Notice”) to the followingrespective addresses:(a)if to CCEMC:Climate Change and Emissions Management (CCEMC) CorporationPO Box 3197Sherwood Park, Alberta T8H 2T2Fax: 780.416.0812Email: info@ccemc.ca(b)if to the Recipient:[Address]Attention:Phone:Fax:Email:(c)and a copy of any Notice under this Agreement shall be sent to:(i)Davis LLP1201 Scotia 2 TowerDavis: 8418076.17

- 17 -10060 Jasper AvenueEdmonton, AB T5J 4E5Attention:Robert A. Seidel, Q.C.Fax: 780.702.4363Email: rseidel@davis.caEither Party may change its address information by giving Notice to the other Party.Any Notice is deemed to have been received on the day of delivery, if hand-delivered,when the other Party acknowledges receipt, if sent by registered mail and one businessday following transmission, if sent by facsimile or email.15.2 CCEMC designates and authorizes the CCEMC Project Advisor as having authority tocommunicate to the Recipient on behalf of CCEMC any direction, notice, consent orother communication under this Agreement. The Recipient designates and authorizesthe Recipient Liaison as having authority to communicate to CCEMC on behalf of theRecipient any direction, notice, consent or other communication under this Agreement.In the absence of any further designation or limitation communicated by either party tothe other, each Party may assume that CCEMC or the Recipient has duly authorizedany such communication from any of the above individuals, as the case may be.16. MISCELLANEOUS16.1 This Agreement is an agreement for the Contribution only. It does not create apartnership, agency, joint venture or employer/employee relationship between theParties and the Recipient shall not represent itself as such, including in any agreementwith a third party.16.2 The Recipient shall not, without the prior written consent of CCEMC, cause or suffer toexist any sale, transfer, assignment, or pledge of interest which would result in(a)(b)(c)a change in majority ownership or control of the Recipient,the disposition of all or substantially all of the assets of the Recipient, orthe amalgamation or merger of the Recipient with any third party.16.3 The Recipient declares and guarantees that no offer, gift or payment, consideration orbenefit of any kind, which constitutes an illegal or corrupt practice, has been or shall bemade to anyone by the Recipient, either directly or indirectly, as an inducement orreward for the award or execution of the Agreement. Any such practice is grounds forterminating the Agreement or taking any other corrective action as required.16.4 The Recipient shall declare in writing to CCEMC if the Recipient or any of theRecipient’s officers, employees or subcontractors included in the Project(a)were convicted during a period of three years prior to the submission of theProject proposal, by a court of law in Canada or in any other jurisdiction for anoffence involving bribery or corruption, orDavis: 8418076.17

- 18 -(b)are under sanction for an offence inducing bribery or corruption, imposed by agovernment, a governmental organization or a development organizationproviding development assistance.16.5 The Parties may, from time to time, to do all such acts and provide such furtherassurances and instruments as may reasonably be required in order to carry out theprovisions of this Agreement according to their spirit and intent.16.6 This Agreement shall enure to the benefit of and be binding upon the Parties and theirrespective heirs, executors, administrators, successors and assigns.16.7 If any provision of this Agreement is found to be invalid at law by a court of competentjurisdiction, then such provision shall be deemed to be severed from this Agreement andthe remainder of this Agreement shall not be affected and shall remain in full force to theextent permitted by law.16.8 Time is of the essence in this Agreement.16.9 This Agreement may be signed by originals or by facsimile or portable document format(PDF) and executed in any number of counterparts, and each executed counterpartshall be considered to be an original. All executed counterparts taken together shallconstitute one agreement.16.10 This Agreement shall be governed by the laws of the Province of Alberta and theFederal laws of Canada applicable therein and the Alberta courts shall have jurisdictionwith regard to all matters arising under or in connection with them.CLIMATE CHANGE AND EMISSIONSMANAGEMENT (CCEMC) CORPORATIONPer:__________________________________Authorized Signatory[RECIPIENT]Per:__________________________________Authorized SignatoryDavis: 8418076.17

SCHEDULE APROJECT SCOPE, BUDGET, PROJECT PLAN, AND REPORTSPROJECT SCOPE1. Project NameandDescription2. Project StartDate3. ProjectCompletionDate4. Total ProjectValue (i.e. totalcosts)BUDGET5. Budget bytask/ milestone• Budget must include project costs by tasks and milestones,including time frame to complete each task/milestone and eachsuch cost shall be an Eligible Expense.• A template for budget by task/milestone is set out as Schedule A,section 5 at the end of this Schedule.PROJECT PLAN6. ProjectFinancingSchedule7. Work Plan REPORTS8. ReportsFormatAll reports must contain the information and be in a format specified byor acceptable to CCEMC, as may be made available by CCEMC onCCEMC’s website, or as otherwise provided to the Recipient prior to oron the commencement of the Term.Davis: 8418076.17

9. ProgressReportsDuring the Term, and in accordance with the Work Plan and ProjectFinancing Schedule, the Recipient shall upload into the CCEMCInformation Management System:• electronic technical progress reports providing information onthe progress of the Project and Project Technology and ofany new technology developed in the course of carrying outthe Project; and• financial reports accounting for all Project revenues andexpenditures, together with all interest earned frominvestments of the Contribution Proceeds.Progress Reports should outline the activities and achievements for theperiod in which they apply and foreshadow the following period.10. PerformanceReportsThe Recipient shall provide the following reports detailing actual Projectresults and estimated expenditures with respect to the performancecriteria and approved Budget for the respective fiscal year of the Term:• an annual performance report detailing actual results for eachfiscal year with respect to the Project’s targets specified in theProject’s Work Plan (“Performance Targets”) and any otherperformance criteria included in the Project’s Full ProjectProposal document. The annual performance report is due by of each fiscal year of the Term; and• a mid-year performance report updating progress as it relates tothe Performance Targets and any other performance criteriaincluded in the Project’s Full Project Proposal document for thefirst half of the fiscal year of the Term. The mid-yearperformance report is due by of each fiscal year of the Term.11. Final FinancialReport12. FinalOutcomesReportThe Recipient shall provide a Final Financial report, accounting for allProject revenues and expenditures.The Recipient shall provide a final technical report that reports on theoutcomes of the Project (“Final Outcomes Report”). The FinalOutcomes Report must also include a concise summary of what theProject has achieved and provide conclusions and recommendations forfurther fields of research inquiry together with the status of performanceof the Project in terms of process, output, outcomes and impactmeasures. The Final Outcomes Report must delineate all ProjectTechnology developed in the course of the Project. The Final OutcomesReport must be in sufficient detail to permit readers to use or adapt theresults for research and analysis purposes and to understand how theconclusions were arrived at.Davis: 8418076.17

13. Final Reportand Non-ConfidentialFinal ReportThe Final Outcomes Report and the Final Financial Report collectivelymake up the final report (“Final Report”), submitted by the Recipient toCCEMC in accordance with this Schedule A and the terms of thisAgreement.On or before the Project Completion Date, the Final Report shall besubmitted in one bound copy, two unbound copies, and one electronicversion. CCEMC may make copies of the Final Report for its internaluse and for use by CCEMC.The Recipient should also be prepared to address the Final Report in apresentation to CCEMC.The Final Report shall be satisfactory to CCEMC in its sole discretion,acting reasonably.The Recipient shall provide a non-confidential final report ("Non-Confidential Final Report") that reports on the outcomes of the Project.The Non-Confidential Final Report shall be based upon the FinalOutcomes Report contemplated above and shall have confidentialinformation of the Recipient, which may be contained in the Final Reportremoved. The Non-Confidential Final Report is intended to be a publicdocument detailing the Project outcomes and any GHG emissionreductions.The Recipient shall deliver the Non-Confidential Final Report within thirty(30) days of the Project Completion Date.14. Changes to theProject Plan15. Use of FinalReport andNon-ConfidentialFinal ReportThe Recipient shall communicate to CCEMC, as soon as possible,proposed significant changes in the project direction, project scope,costs, types of expenditures or third party funding, including any neededextensions to secure funds, through a detailed report and obtainCCEMC’s written consent prior to proceeding. The report outliningchanges to the Work Plan or Project Financing Schedule is additional toother reporting requirements outlined in this Schedule.The Recipient a) grants CCEMC an irrevocable, royalty and fee free,world wide, non-exclusive right to use the Final Report and the Non-Confidential Final Report for publication or for any other purpose, and b)shall provide waivers of moral rights in form and substance satisfactoryto CCEMC of the authors of the Final Report and Non-Confidential FinalReport in favour of CCEMC and the CCEMC’s assignees and licensees.16. Other Reports During the Term and for a period of five years thereafter, the Recipientmust provide such additional follow-up information as CCEMC mayreasonably request for the purpose of evaluating the Project outcomesor benefits.Davis: 8418076.17

17. Disclaimer All reports must include the following disclaimer on the cover of thereport or at the commencement of the report:CCEMC makes no warranty, express or implied, nor assumesany legal liability or responsibility for the accuracy, completeness,or usefulness of any information contained in this publication, northat use thereof does not infringe on privately owned rights. Theviews and opinions of the author expressed herein do notnecessarily reflect those of CCEMC. The directors, officers,employees, agents and consultants of CCEMC are exempted,excluded and absolved from all liability for damage or injury,howsoever caused, to any person in connection with or arisingout of the use by that person for any purpose of this publicationor its contents.18. Verification The Recipient shall be required to provide a third party verification reportof GHG emission reductions (the “Verification”) one (1) year followingCCEMC’s receipt of an acceptable Final Report. The Verification Reportshall be satisfactory to CCEMC in the exercise of its sole discretion.This section does not apply to Projects that do not have any GHGemission reductions.The cost for the Verification Report shall be borne by the Recipient.The Recipient may be required to provide ongoing verification of GHGemission reductions after the Term.19. OffsetReportingThe Recipient shall be required to provide a report on all applications orproposals for offset credits under the Alberta offset system.Schedule A, section 5 - Budget by task/milestoneMilestone Activity StartDate1 –Progressreport – xx%complete2 – Annualreport – xx%complete345TotalEnd DateProponent Funds($ in000s)CCEMCFunds($ in000s)TotalFunds ($in 000s)Davis: 8418076.17

SCHEDULE BPAYMENT SCHEDULEPayment Schedule - Subject to and in accordance with the Agreement, including receipt of thereports required by Schedule A, the Contribution of up to $ shall be paid upon receipt ofinvoices and according to the Project Financing Schedule:1. Following the completion of each milestone/task as described in table of Schedule A,(each a “Reporting Period”), the Recipient shall provide CCEMC with a ProgressReport which includes an outline of all Eligible Expenses and ineligible expensesincurred during the Reporting Period from the last Reporting Period, together with aninvoice for Eligible Expenses (“Invoiced Amounts”). The Progress Reports must alsooutline all funds received by the Recipient from third parties with respect to the Project.2. Following each Reporting Period, CCEMC shall reimburse the Recipient for InvoicedAmounts up to the maximum percentage of Contribution set out in section 2.1 of theAgreement, and to a maximum of $.3. Progress Reports must accompany each invoice and be certified by the Recipient priorto release of Contribution funds by CCEMC.4. Each invoiced amount shall be subject to a minimum of twenty (20%) percent hold backwhich amount shall be released to the Recipient by CCEMC following CCEMC’sacceptance of each Verification Report.5. CCEMC may require the Recipient to provide it with evidence of Eligible Expensestogether with each Progress Report, including receipts, evidence of payment or invoicespaid by the Recipient.Davis: 8418076.17

SCHEDULE CCONFLICT OF INTEREST POLICYCONFLICT OF INTEREST POLICYCLIMATE CHANGE AND EMISSIONS MANAGEMENT (CCEMC) CORPORATIONDATE OF APPROVAL: SEPTEMBER 28, 2010A. BACKGROUNDThe Climate Change and Emissions Management (CCEMC) Corporation (“CCEMC”) has theauthority and obligation to impose conflict of interest guidelines and policies on its directors andofficers.Pursuant to its Bylaws, the affairs of CCEMC are managed and directed by the directors ofCCEMC. The directors of CCEMC, by virtue of their position of control over the affairs ofCCEMC, stand in a fiduciary relationship to CCEMC. Consequently, the directors of CCEMCmust have regard to the requirements of the law governing fiduciary relationships whereconflicts of interest arise.The directors of CCEMC are mindful that their actions shall be subject to public scrutiny.CCEMC has been delegated the performance of the Minister’s duties and functions and theexercise of the Minister’s powers under the Climate Change and Emissions Management FundAdministration Regulation (the “Regulation”) made pursuant to the Climate Change andEmissions Management Act (the “Act”). The directors of CCEMC discharge these powers,duties, and functions in a manner which is consistent with the Regulation and Act and whichfurthers the public interest.CCEMC has adopted a set of guidelines which shall assist the directors of CCEMC to dischargetheir duties in accordance with their responsibilities. The guidelines are attached to and formpart of this policy statement.B. COMMON LAW REQUIREMENTS1. The common law imposes upon fiduciaries the duty to act in utmost good faith towardstheir beneficiaries. Fiduciaries must act toward their beneficiaries with a heightenedsense of loyalty and fidelity. Fiduciaries must act in a manner consistent with the bestinterests of their beneficiaries in all matters related to the undertaking of trust andconfidence. Fiduciaries must scrupulously avoid placing themselves in a position ofconflict of interest.2. The general rule regarding conflicts of interests is that no one who has duties of afiduciary nature to perform is allowed to enter into engagements in which he has or canhave a personal interest conflicting with the interests of those whom he is bound toprotect. Even where the fiduciary acts in good faith, the foregoing restriction applies. Afiduciary cannot place his own interests ahead of those of his beneficiary, even insituations where the beneficiary benefits from the arrangement. A fiduciary cannotbenefit personally from any opportunity which comes to his awareness by way of hisfiduciary position. A fiduciary must not use any aspect of the beneficiary’s property forDavis: 8418076.17

personal gain. More specifically, a fiduciary must not use for personal benefit abeneficiary’s assets, goods, information or opportunities.3. Fiduciaries must not use their position to benefit persons closely associated with them.Where a benefit is conferred upon a person with whom the fiduciary is closelyassociated, the fiduciary benefits indirectly. Regard must be had to all of thesurrounding circumstances to determine whether a person is associated with a fiduciary.Persons sharing business relations or a family relationship shall in most instances becharacterized as associates of the fiduciary. In some instances, close personalrelationships shall also give rise to an association between the fiduciary and the person.The key issue in determining whether a fiduciary is associated with another person iswhether the fiduciary’s ability to represent the interests of the beneficiary is or appearsto be compromised as a result of the fiduciary’s relationship with the third party.C. APPLICATION OF FIDUCIARY PRINCIPLES TO CCEMC DIRECTORS1. The directors of CCEMC stand in a fiduciary relationship with CCEMC. The directorsmust not use their position to gain benefit personally, whether such benefit accrues tothem directly or indirectly. Prior to their appointment, all directors should be screenedfor potential conflicts of interest.2. Directors must not use their position to benefit persons related to them or with whomthey are closely associated, such as business partners.3. These types of transactions are exceptional and are not anticipated to arise with anyfrequency. Where they do arise, the affected Director must declare a conflict, fullydisclose his interest in the transaction, and refrain from voting upon the matter.Whether the transaction shall be approved shall be a matter for the Board to determine.4. Directors are encouraged not to make frequent use of the exceptions provided above.The general rule that CCEMC does not enter into transactions with directors or withrelated persons must be observed with minimal exceptions in order to ensure publicconfidence in CCEMC and its undertakings remains high.D. GENERAL FIDUCIARY RESPONSIBILITIES OF DIRECTORS1. The Board has been structured so as to ensure that the Board is composed of a diverseselection of individuals. Each individual director is expected to bring to the Board a setof viewpoints and experiences which may not be experienced by his fellow directors.This diversity of viewpoints and experience at the Board adds strength and depth toBoard decisions.2. Directors must appreciate that while their appointment to the Board or to a committeemay be as a result of a particular organization, as directors their loyalties are first andonly to CCEMC.3. Directors will be required to make decisions based on what they perceive to be the bestinterests of CCEMC. Although it is intended that directors will draw upon theirexperiences and views gained through their association with other organizations, it is notintended that directors serve as representatives of those associations on CCEMC.Davis: 8418076.17

4. Directors may find themselves in a position of conflict as a result of their associationswith organizations having dealings with CCEMC. A conflict may arise where anorganization seeks to enter into a transaction with CCEMC. Where a conflict arises, theaffected Director or committee member must declare the conflict, fully disclose anypersonal interest he or she may have in the transaction, and refrain from voting upon thematter. Whether the transaction will be approved will be a matter for the Board or thecommittee to determine.5. It would be inconsistent with their duties of loyalty and fidelity to CCEMC for a Director toparticipate in a decision relating to a matter in which they have a conflict of interest.Their participation in any decisions related to a matter in which they have a conflict couldinvalidate the decision and could result in embarrassment to both CCEMC and theaffected organization. If the conflict is significant, public confidence in CCEMC couldsuffer.E. CONFLICT OF INTEREST GUIDELINES1. Definitions(a)In these Guidelines,(i)“Associated” means a relationship, transaction or connection such thatthe relationship, transaction or connection:A. has the potential to affect or give the appearance of affecting theability of the Director or Committee Member to act impartially onbehalf of CCEMC; orB. between CCEMC and the person would, or would be seen to,confer a direct or indirect benefit upon the Director or CommitteeMember;(ii)(iii)(iv)(v)(vi)(vii)(viii)“Benefit” means a direct or indirect pecuniary or non-pecuniaryadvantage and includes the avoidance of a detriment, but does notinclude the prestige associated with the position of Director or CommitteeMember nor participation in activities or programs of CCEMC in which thepublic has an opportunity to participate;“Board” means the Board of directors of CCEMC;“Bylaws” means the Bylaws of the CCEMC;“CCEMC” means the Climate Change and Emissions Management(CCEMC) Corporation;“Chair” means the Chair of the Board;“Committee” means a Board Committee or Sub-Committee of CCEMC;“Committee Member” means a member of a Committee;Davis: 8418076.17

(ix)(x)(xi)(xii)(xiii)“Director” means a member of the Board of CCEMC;“Member Organization” means any organization that becomes amember of the CCEMC in accordance with the Bylaws;“Policy” means this Conflict of Interest Policy;“Related Person” means a person who is Associated with a Director orCommittee Member; and“Transaction” means an arrangement, other than a gift, under which,A. CCEMC and another person agree to exchange value or services;B. CCEMC confers a benefit on another person; orC. CCEMC receives a benefit from another person.2. Statement of Principles(a)(b)(c)(d)(e)(f)(g)(h)These Conflict of Interest Guidelines apply to all Directors and CommitteeMembers.Directors and Committee Members are required to disclose to the Chair or hisdesignate, any situation involving that Director or Committee Member which is aconflict of interest or apparent conflict of interest. The Chair is required todisclose to the other Board members or Committee Members any situationinvolving the Chair which is a conflict of interest or apparent conflict of interest.Directors and Committee Members, upon appointment, and on an annual basisthereafter, will complete a Declaration of Interest form as set out in Appendix “A”to enable the Corporation to understand potential conflicts and to manage themappropriately.In respect to conflicts that have been identified by Directors and CommitteeMembers, data information, analyses, reports including without limitation boardmaterials and information will not be provided to the Directors or CommitteeMembers who have identified a conflict of interest.Directors and Committee Members are expected in all regards to conduct theirduties with impartiality shall at all times act in accordance with and displayutmost good faith towards the CCEMC.Directors and Committee Members shall at all times act in accordance with anddisplay a heightened sense of loyalty and fidelity to CCEMC.Directors and Committee Members shall not use for personal gain any ofCCEMC’s assets, goods, information or opportunities.Directors and Committee Members shall not disclose any information which isconfidential to CCEMC during or after their tenure as Directors or CommitteeMembers except as may be authorized by CCEMC or required by law.Davis: 8418076.17

3. Prohibited and Permitted TransactionsExcept in accordance with this policy,(a)(b)CCEMC shall not enter into Transactions with a Director or a Related Personwhere the Director, Committee Member or Related Person may directly orindirectly benefit from the Transaction.CCEMC may enter into a Transaction with a Director, Committee Member orRelated Person if,(i)the affected Director or Committee Member:A. declares a conflict of interest in respect of the proposedTransaction; andB. discloses to the Board or Committee the full nature and extent ofhis interest in the proposed transaction and, to the extent that heis able, the interest of any Related Person in the proposedTransaction; and(ii)it is established to the satisfaction of the Board or Committee that:A. the proposed Transaction is fair and reasonable to CCEMC; andB. the proposed Transaction would meet or exceed communityexpectations about the conduct of CCEMC; and(iii)the Board or Committee approves the proposed Transaction.(c)(d)(e)(f)(g)When authorizing a Transaction under this Conflict of Interest Guidelines, theBoard may impose any conditions it deems necessary in the circumstances toprotect CCEMC or to safeguard public confidence in CCEMC’s undertakings.For the purposes of this Conflict of Interest Guidelines, the affected Director orCommittee Member shall not participate in any decisions relating to the proposedTransaction.For the purposes of this Conflict of Interest Guidelines, the affected Director orCommittee Members shall not be counted as part of the quorum making anydecisions relating to the proposed Transaction.Where the Board approves a Transaction under these Conflict of InterestGuidelines, an entry shall be made into the minutes of the meeting confirmingthe approval of the Transaction by the Board or Committee.The Board may review any decision made by a Committee to approve aTransaction under these Conflict of Interest Guidelines.Davis: 8418076.17

Appendix “A”Declaration of InterestI, (print name) ____________________________ hereby declare my own interest in oroffice in the following company/companies:Type of InterestCompany NameAttach additional pages if requiredI, (print name) ____________________________ hereby declare my immediate familymembers’ interest in or office in the following company/companies:Type of InterestCompany NameAttach additional pages if required____________________________Signature of Declarant____________________________Signature of Chair or his designate______________________________________Date______________________________________DateDavis: 8418076.17

SCHEDULE DCCEMC PROJECT ADVISOR AND RECIPIENT LIAISONCCEMCProject AdvisorRecipient LiaisonDavis: 8418076.17