1. Applicability. (a) These terms and conditions of sale (these “Terms”) are the only terms which govern the sale of the goods (“Goods”) by American Peat Technology, LLC, a Minnesota limited liability company (“Seller”) to the purchasing party (“Buyer”) identified in Seller’s order acknowledgment (“Acknowledgment”). Notwithstanding anything herein to the contrary, if a written contract signed by both parties is in existence governing the sale of the Goods covered hereby, the terms and conditions of said contract shall prevail to the extent they are inconsistent with these Terms. (b) The Acknowledgment and these Terms (collectively, the “Agreement”) comprise the entire agreement between the parties, and supersede all prior or contemporaneous understandings, agreements, negotiations, representations and warranties, and communications, both written and oral. These Terms prevail over any of Buyer’s general terms and conditions of purchase regardless of whether or when Buyer has submitted its purchase order or such terms. Fulfillment of Buyer’s order does not constitute acceptance of any of Buyer’s terms and conditions and does not serve to modify or amend these Terms.

2. Tender. (a) The goods will be tendered within a reasonable time after the receipt of Buyer’s purchase order, subject to availability of finished Goods. Seller shall not be liable for any delays, loss or damage in transit. (b) Unless otherwise agreed in writing by the parties, Seller shall tender the Goods to Buyer or its specified carrier at Seller’s Aitkin County, Minnesota facility (the “Tender Point”) using Seller’s standard methods for packaging and shipping such Goods. Buyer shall take delivery of the Goods within five (5) business days after Seller’s written notice that the Goods have been tendered at the Tender Point. (c) Seller may, in its sole discretion, without liability or penalty, make partial shipments of Goods to Buyer. Each shipment will constitute a separate sale, and Buyer shall pay for the units shipped whether such shipment is in whole or partial fulfillment of Buyer’s purchase order. (d) If for any reason Buyer fails to accept tender of any of the Goods on the date fixed pursuant to Seller’s notice that the Goods have been tendered at the Tender Point, or if Seller is unable to tender the Goods at the Tender Point on such date because Buyer has not provided appropriate instructions, documents, licenses or authorizations: (i) risk of loss to the Goods shall pass to Buyer; (ii) the Goods shall be deemed to have been tendered; and (iii) Seller, at its option, may store the Goods at Seller’s then-prevailing storage rates or ship the Goods to a third-party storage facility with shipping and storage at Buyer’s sole cost and expense. If Seller elects to store Buyer’s Goods for any period, Buyer assumes all risk of loss, Seller shall not be deemed to be a bailee of Buyer’s Goods and Buyer shall be liable for all related costs and expenses (including, without limitation, storage and insurance).

3. Non-Delivery. (a) The quantity of any installment of Goods as recorded by Seller on dispatch from Seller’s place of business is conclusive evidence of the quantity received by Buyer unless Buyer can provide conclusive evidence proving the contrary. (b) The Seller shall not be liable for any non-delivery of Goods.

4. Quantity. Seller may tender to Buyer a quantity of Goods of up to ten percent (10%) more or less than the quantity set forth in the Acknowledgment, and Buyer shall not be entitled to object to or reject the Goods or any portion of them by reason of the surplus or shortfall and shall pay for such Goods the price set forth in the Acknowledgment adjusted pro rata.

5. Shipping Terms. Tender of orders for fulfillment in the United States shall be made FOB Seller’s Aitkin County, Minnesota facility. Tender of orders for fulfillment outside of the United States shall be made EXW (Incoterms) Seller’s Aitkin County, Minnesota facility.

6. Title and Risk of Loss. Title and risk of loss passes to Buyer upon tender of the Goods at the Tender Point. As collateral security for the payment of the purchase price of the Goods, Buyer hereby grants to Seller a lien on and purchase money security interest in and to all of the right, title and interest of Buyer in, to and under the Goods, wherever located, and whether now existing or hereafter arising or acquired from time to time, and in all accessions thereto and replacements or modifications thereof, as well as all proceeds (including insurance proceeds) of the foregoing.

7. Amendment and Modification. These Terms may only be amended or modified in a writing which specifically states that it amends these Terms and is signed by an authorized representative of each party.

8. Inspection and Rejection of Nonconforming Goods. (a) Buyer shall inspect the Goods within ten (10) days of actual receipt, not to exceed thirty (30) days after tender at the Tender Point (“Inspection Period”). Buyer will be deemed to have accepted the Goods unless it notifies Seller in writing of any Nonconforming Goods during the Inspection Period and furnishes such written evidence or other documentation as reasonably required by Seller. “Nonconforming Goods” means only the following: (i) product shipped is different than identified in Seller’s Acknowledgment; or (ii) product’s label or packaging incorrectly identifies its contents. (b) If Buyer timely notifies Seller of any Nonconforming Goods, Seller shall, in its sole discretion, (i) replace such Nonconforming Goods with conforming Goods, or (ii) credit or refund the Price for such Nonconforming Goods, together with any reasonable shipping and handling expenses incurred by Buyer in connection therewith. Buyer shall ship, at its expense and risk of loss, the Nonconforming Goods to Seller’s Aitkin County, Minnesota facility. If Seller exercises its option to replace Nonconforming Goods, Seller shall, ship to Buyer, at Seller’s expense and risk of loss, the replacement Goods to the place of delivery in the continental United States specified by Buyer. (c) Buyer acknowledges and agrees that the remedies set forth in Section 8(b) are Buyer’s sole and exclusive remedies for Nonconforming Goods. Except as provided under Section 8(b), all sales of Goods to Buyer are made on a one-way basis and Buyer has no right to return Goods purchased under the Agreement to Seller.

9. Price. (a) Unless specified otherwise in the Acknowledgment, Buyer shall purchase the Goods from Seller at the prices set forth in Seller’s published price list in force as of the date that Seller accepts Buyer’s purchase order (the “Prices”). (b) All Prices are exclusive of all sales, use and excise taxes, and any other similar taxes, duties and charges of any kind imposed by any Governmental Authority on any amounts payable by Buyer. Buyer shall be responsible for all such charges, costs and taxes; provided, that, Buyer shall not be responsible for any taxes imposed on, or with respect to, Seller’s income, revenues, gross

receipts, personnel or real or personal property or other assets.

10. Payment Terms. (a) Unless specified otherwise in the Acknowledgment, Buyer shall pay all invoiced amounts due to Seller within thirty (30) days after the date of Seller’s invoice. Buyer shall make all payments hereunder in US dollars. (b) Buyer shall pay interest on all late payments at the lower of the rate of 1.5% per month or the highest rate permissible under applicable law, calculated daily and compounded monthly. Buyer shall reimburse Seller for all costs incurred in collecting any late payments, including, without limitation, attorneys’ fees. In addition to all other remedies available under these Terms or at law (which Seller does not waive by the exercise of any rights hereunder), Seller shall be entitled to suspend the sale, tender or delivery of any Goods if Buyer fails to pay any amounts when due hereunder. (c) Buyer shall not withhold payment of any amounts due and payable by reason of any set-off of any claim or dispute with Seller, whether relating to Seller’s breach, bankruptcy or otherwise. (d) Seller may, in its sole and absolute discretion, impose different payments terms, including requiring advance deposits and COD terms, if Buyer defaults on any payment terms on any order with Seller. Seller may suspend shipment if Buyer is in default on any orders.

11. Limited Warranty. (a) Seller warrants solely to Buyer that for a period six (6) months after the date of shipment of the Goods (“Warranty Period”), the Goods will conform in all material respects to Seller’s published specifications for such Goods in effect as of the date of shipment (the “Limited Product Warranty”). (b) EXCEPT FOR THE LIMITED PRODUCT WARRANTY, SELLER MAKES NO WARRANTY WHATSOEVER WITH RESPECT TO THE GOODS, AND HEREBY DISCLAIMS ANY IMPLIED WARRANTIES, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE; IN ALL CASES WHETHER EXPRESS OR IMPLIED BY LAW, COURSE OF DEALING, COURSE OF PERFORMANCE, USAGE OF TRADE OR OTHERWISE. (c) SELLER MAKES NO OTHER REPRESENTATIONS OR WARRANTIES AND HEREBY DISCLAIMS ANY IMPLIED WARRANTIES, INCLUDING THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE; IN ALL CASES WHETHER EXPRESS OR IMPLIED BY LAW, COURSE OF DEALING, COURSE OF PERFORMANCE, USAGE OF TRADE OR OTHERWISE. (c) The Seller shall not be liable for a breach of the Limited Product Warranty unless: (i) Buyer gives written notice of the defect, reasonably described, to Seller within the Warranty Period and no later than thirty (30) days of the time when Buyer discovers or ought to have discovered the defect; (ii) Seller is given a reasonable opportunity after receiving the notice to examine such Goods and Buyer (if requested to do so by Seller) returns such Goods to Seller’s Aitkin County facility at Seller’s cost for the examination to take place there; and (iii) Seller reasonably verifies Buyer’s claim that the Goods are defective. (d) The Seller shall not be liable for a breach of the Limited Product Warranty if: (i) Buyer makes any further use of such Goods after giving such notice; or (ii) Buyer alters such Goods. (e) Subject to Section 11(c) and Section 11(d) above, with respect to any such Goods during the Warranty Period, Seller shall, in its sole discretion, either: (i) repair or replace such Goods (or the defective part) or (ii) credit or refund the price of such Goods at the pro rata contract rate provided that, if Seller so requests, Buyer shall, at Seller’s expense, return such Goods to Seller. (f) THE REMEDIES SET FORTH IN SECTION 11(e) SHALL BE BUYER’S SOLE AND EXCLUSIVE REMEDY AND SELLER’S ENTIRE LIABILITY FOR ANY BREACH OF THE LIMITED PRODUCT WARRANTY AND ARE GIVEN IN LIEU OF ALL OTHER REMEDIES.

12. Assumption of Risk and Information. (a) Buyer assumes all risk of use and resale of the Goods and Seller’s only liability to Buyer shall be as set forth in the Limited Product Warranty and the exclusive remedies Section 11(e). Without limiting the foregoing, Buyer assumes all responsibility to determine the suitability and performance of the Goods for Buyer’s and its customers’ end uses, and the impact that Buyer’s and its customers’ use of the Goods may have on the health and safety of third parties or the public. (b) Seller has no duty to provide Buyer with additional technical, product or other information regarding the Goods or their sourcing or manufacturing or to assist Buyer in securing or maintaining third party or government contracts. To the extent Seller provides such additional information to Buyer, Buyer assumes all risk with respect to such information and assumes the duty and obligation to verify the accuracy of such information. (c) Buyer acknowledges all additional information, advice or guidance provided by Seller is provided “AS-IS” with all faults and Buyer assumes the responsibility to verify such advice and guidance to its satisfaction.

13. Limitation of Liability. (a) IN NO EVENT SHALL SELLER BE LIABLE TO BUYER OR ANY THIRD PARTY FOR ANY LOSS OF USE, REVENUE OR PROFIT OR LOSS OF DATA OR DIMINUTION IN VALUE, OR FOR ANY CONSEQUENTIAL, INDIRECT, INCIDENTAL, SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES WHETHER ARISING OUT OF BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE AND WHETHER OR NOT SELLER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND NOTWITHSTANDING THE FAILURE OF ANY AGREED OR OTHER REMEDY OF ITS ESSENTIAL PURPOSE. (b) IN NO EVENT SHALL SELLER’S AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THE AGREEMENT, WHETHER ARISING OUT OF OR RELATED TO BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, EXCEED THE TOTAL OF THE AMOUNTS PAID TO SELLER FOR THE GOODS SOLD UNDER THE AGREEMENT.

14. Compliance with Law. Buyer shall comply with all applicable laws, regulations and ordinances. Buyer shall maintain in effect all licenses, permissions, authorizations, consents and permits that it needs to carry out its obligations under the Agreement. Buyer shall comply with all export and import laws of all countries involved in the sale of the Goods under the Agreement or any resale of the Goods by Buyer. Buyer assumes all responsibility for shipments of Goods requiring any government import clearance. Seller may terminate the Agreement if any governmental authority imposes antidumping or countervailing duties or any other penalties on Goods.

15. Termination. In addition to any remedies that may be provided under these Terms, Seller may terminate the Agreement with immediate effect upon written notice to Buyer, if Buyer: (i) fails to pay any amount when due under the Agreement; (ii) has not otherwise performed or complied with any of these Terms, in whole or in part; or (iii) becomes insolvent, files a petition for bankruptcy or commences or has commenced against it proceedings relating to

bankruptcy, receivership, reorganization or assignment for the benefit of creditors.

16. Waiver. No waiver by Seller of any of the provisions of the Agreement is effective unless explicitly set forth in writing and signed by Seller. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from the Agreement operates, or may be construed, as a waiver thereof. No single or partial exercise of any right, remedy, power or privilege hereunder precludes any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

17. Force Majeure. Seller shall not be liable or responsible to Buyer, nor be deemed to have defaulted under or breached the Agreement, for any failure or delay in fulfilling or performing any term of the Agreement, when and to the extent such failure or delay is caused by or results from acts beyond Seller’s reasonable control, including, without limitation, the following force majeure events (“Force Majeure Events”): acts of God; flood, fire, earthquake, fires, extreme drought, extreme cold, adverse weather condition preventing harvesting or mining of peat, epidemics, or explosion; war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; government order, law, or actions; embargoes or blockades in effect on or after the date of the Agreement; national or regional emergency; strikes, labor stoppages or slowdowns, or other industrial disturbances; or shortage of adequate power or transportation facilities. Seller may allocate available products and Goods during a Force Majeure Event in its reasonable discretion.

18. Assignment. Buyer shall not assign any of its rights or delegate any of its obligations under the Agreement without the prior written consent of Seller. Any purported assignment or delegation in violation of this Section is null and void. No assignment or delegation relieves Buyer of any of its obligations under the Agreement.

19. Relationship of the Parties. The relationship between the parties is that of buyer and seller. The Agreement does not create any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever.

20. No Third-Party Beneficiaries. There are no third party beneficiaries to the Agreement.

21. Governing Law; Language. All matters arising out of or relating to the Agreement is governed by and construed in accordance with the internal laws of the State of Minnesota without giving effect to any choice or conflict of law provision or rule that would cause the application of the laws of any other jurisdiction. The Convention for the International Sale of Goods shall not apply to the Agreement. The Agreement is drafted and prepared in the English language. Translations to any other language are for convenience only and to the extent such translations differ with the English version, the English version shall control.

22. Submission to Jurisdiction. If buyer is domiciled in the United States of America, any legal suit, action or proceeding arising out of or relating to the Agreement shall be instituted in the federal courts of the United States of America in the District of Minnesota or the courts of the State of Minnesota, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding.

23. International Arbitration. If Buyer is not domiciled in the United States of America, any controversy or claim arising out of or relating to the Agreement, or the breach thereof, shall be determined by binding arbitration administered by the International Centre for Dispute Resolution in accordance with its International Arbitration Rules. Judgment on the award may be entered in any court of tribunal have jurisdiction over Buyer or Seller or their assets. Such arbitration shall be conducted in the English Language in Minneapolis, Minnesota.

24. Notices. All notices, request, consents, claims, demands, waivers and other communications hereunder (each, a “Notice”) shall be in writing and addressed to the parties at the addresses set forth on the face of the Acknowledgment or to such other address that may be designated by the receiving party in writing. All Notices shall be delivered by personal delivery, nationally recognized overnight courier (with all fees pre-paid) or certified or registered mail (in each case, return receipt requested, postage prepaid).

25. Severability. If any term or provision of the Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of the Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction.

4862-9642-9995, v.3

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