Document:

Promissory Note and Account Pledge Agreement

 Exhibit 10.48 
 PROMISSORY NOTE 
 References in the boxes above are for Lender’s use only and do not limit the applicability of this document
to any particular loan or item. Any item above containing ‘ I I - has been omitted due to text length limitations. 
  

							
	Borrower:	  	ADA-ES, INC.	  	tender:	  	COLORADO BUSINESS BANK
		  	8100 SOUTHPARK WY UNIT 82	  		  	NORTHEAST
		  	LITTLETON, CO 80120	  		  	4695 QUEBEC ST.
		  		  		  	DENVER, CO 80216

  

			
	Principal Amount: 84,000,000.00	  	Date of Note: August 15, 2008

 PROMISE TO PAY. ADA-ES, INC. 1”Borrower’) promises to pay to COLORADO BUSINESS BANK
(‘Lender”), or order, in lawful money of the United States of America, on demand, the principal amount of Four Million & 001100 Dollars ($4,000,000.00) or so much as may be outstanding, together with Interest on the unpaid
outstanding principal balance of each advance. Interest shall be calculated from the date of each advance until repayment of each advance. 
 PAYMENT.
Borrower will pay this loan in full immediately upon Lender’s demand. Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid Interest; then to principal; and then to any unpaid collection
costs. Borrower will pay Lender at Lender’s address shown above or at such other place as Lender may designate in writing. 
 VARIABLE INTEREST RATE.
The interest rate on this Note Is subject to change from time to time based on changes In an index which is the WALL STREET JOURNAL PRIME RATE (the ‘Index’). Lender will tell Borrower the current Index rate upon Borrower’s request.
The interest rate change will not occur more often than each DAY. Borrower understands that Lender may make loans based on other rates as well. The Index currently is 5.000% per annum. The interest rate to be applied to the unpaid principal
balance of this Note will be calculated as described in the ‘INTEREST CALCULATION METHOD” paragraph using a rate equal to the Index, resulting in an initial rate of 5.000% per annum based on a year of 360 days. NOTICE: Under no
circumstances will the Interest rate on this Note be more than the maximum rate allowed by applicable law. 
 INTEREST CALCULATION METHOD. Interest on this
Note is computed on a 365/360 basis: that is. by applying the ratio of the Interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance 1s outstanding. AR
interest payable under this Note Is computed using this method. 
 INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the
interest rate on this Note shall be increased by adding a 5.000 percentage point margin (“Default Rate Margin’). The Default Rate Margin shall also apply to each succeeding interest rate change that would have applied had there been no
default. However, in no event will the interest rate exceed the maximum Interest rate limitations under applicable law. 
 LENDER’S RIGHTS. Upon
Lender’s demand, Lender may declare the entire unpaid principal balance under this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount. 
 ATTORNEYS’ FEES; EXPENSES. Lender may hire or pay someone else to help collect this Note If Borrower does not pay. Borrower will pay Lender the reasonable costs of such collection. This includes, subject to any
limits under applicable law, Lender’s attorneys’ fees and Lender’s legal expenses, whether or not there is a lawsuit, including without limitation attorneys’ fees and legal expenses for bankruptcy proceedings (including efforts
to modify or vacate any automatic stay or Injunction), and appeals. If not prohibited by applicable law, Borrower also will pay any court costs, in addition to all other sums provided by law. 
 JURY WAIVER. Lender and Borrower hereby waive the right to any jury trial in any action. proceeding, or counterclaim brought by either Lander or Borrower against the
other. 
 GOVERNING LAW. This Note will be governed by federal law applicable to Lander and, to the extent not preempted by federal law, the laws of the
State of Colorado without regard to Its conflicts of law provisions. This Note has been accepted by Lender in the State of Colorado. 
 DISHONORED ITEM FEE.
Borrower will pay a fee to Lender of $25.00 If Borrower makes a payment on Borrower’s loan and the check or preauthorized charge with which Borrower pays is later dishonored. 
 RIGHT OF SETOFF, To the extant permitted by applicable law, Lender reserves a right of setoff in all Borrower’s accounts with Lender (whether checking, savings, or some other account). This Includes all accounts
Borrower holds jointly with someone else and all accounts Borrower may open In the future. However, this does not Include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law. Borrower authorizes Lender, to
the extent permitted by applicable law, to charge OF setoff all sums owing on the indebtedness against any and all such accounts, 
 LINE OF CREDIT. This
Note evidences a straight line of credit. Once the total amount of principal has been advanced, Borrower Is not entitled to further loan advances. Advances under this Note, as well as directions for payment from Borrower’s accounts, may be
requested orally or In writing by Borrower or by an authorized person. Lender may, but need not, require that all oral requests be confirmed In writing. Borrower agrees to be liable for all sums either: (A) advanced in accordance with the
instructions of an authorized person or (B) credited to any of Borrower’s accounts with Lender. The unpaid principal balance owing on this Note at any time may be evidenced by endorsements on this Note or by Lender’s internal records,
including daily computer print-outs. 
 ADDITIONAL PROVISION. THIS PROMISSORY NOTE IS MADE IN CONJUNCTION WITH LETTER OF CREDIT NO. 
 1436, OR AS MAY BE 
 AMENDED, EXTENDED OR RENEWED. 
 SUCCESSOR INTERESTS. The terms of this Note shall be binding upon Borrower, and upon Borrower’s heirs, personal representatives, successors and assigns, and shall
inure to the benefit of Lender and its successors and assigns. 
 NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES. Please notify
us If we report any Inaccurate information about your account(s) to a consumer reporting agency. Your written notice describing the specific ineccurecy(ies) should be sent to us at the following address: COLORADO BUSINESS BANK ATTN: LOAN OPERATIONS
821 17TH STREET DENVER, CO 80202. 
 GENERAL PROVISIONS. If any part of this Note cannot be enforced, this fact will not affect the rest of the Note. Lender
may delay or forgo enforcing any of its rights or remedies under this Note without losing them. Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, and
notice of dishonor. Upon any change in the terms of this Note, and unless otherwise expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shall be released from liability. All such
parties agree that Lender may renew or extend (repeatedly and for any length of time) this loan or release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender’s security Interest in the collateral; and take
any other action deemed necessary by Lender without the consent of or notice to anyone. All such parties also agree that Lender may modify this loan without the consent of or notice to anyone other than the party with whom the modification is made.
The obligations under this Note are joint and several. 

					
	Loan No: 582956	 	 PROMISSORY NOTE
 (Continued)
	 	

 PRIOR TO SIGNING THIS NOTE, BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE
INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE NOTE. 
 BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE. 

 

			
	BORROWER:
	
	ADA-ES, INC.
		
	By:	 	/s/ Mark H. McKinnies
		 	MARK H. McKINNIES, Chief Financial Officer of ADA-ES, INC.

 CHANGE IN TERMS AGREEMENT 
  

																
	 Principal
	  	Loan Date	  	Maturity	  	Loan No	  	call i con	  	Account	  	Officer	  	Initials
	$	6,600.000.00	  	08-22-2008	  		  	582956	  		  		  	106	  	

 Any item above containing “•’ •” has been omitted due to text length
limitations. 
  

							
	Borrower:	  	ADA-ES, INC.	  	Lender:	  	COLORADO BUSINESS BANK
		  	8100 SOUTHPARK WY., UNIT B2	  		  	NORTHEAST
		  	LITTLETON, CO 80120	  		  	4695 QUEBEC ST.
		  		  		  	DENVER, CO 80216

  

			
	Principal Amount: $6,600,000.00	 	Date of Agreement: August 22, 2008

 $4,000,000.00 WITH AN ORIGINAL MATURITY DATE OF PURE DEMAND AND INCLUDING ANY AND ALL SUBSEQUENT EXTENSIONS OR
MODIFICATIONS THEREFROM. 
 DESCRIPTION OF CHANGE IN TERMS. THE MATURITY DATE WILL REMAIN PURE DEMAND. THE PURPOSE OF THIS CHANGE IN TERMS IS TO HEREBY
INCREASE THE PRINCIPAL AMOUNT FROM $4,000,000.00 TO $6,600,000.00. ALL OTHER TERMS AND CONDITIONS WILL REMAIN THE SAME. 
 PROMISE TO PAY. ADA-ES, INC.
(“Borrower”) promises to pay to COLORADO BUSINESS BANK (“Lender”), or order. In lawful money of the United States of America, on demand, the principal amount of Six Million Six Hundred Thousand & 00/100 Dollars
1$6,600,000.00) or so much as may be outstanding, together with interest on the unpaid outstanding principal balance of each advance. Interest shall be calculated from the date of each advance until repayment of each advance. 
 PAYMENT. Borrower will pay this loan in full immediately upon Lender’s demand. Unless otherwise agreed or required by applicable law, payments will be applied first
to any accrued unpaid interest; then to principal; and then to any unpaid collection costs. Borrower will pay Lender at Lender’s address shown above or at such other place as Lender may designate in writing. 
 VARIABLE INTEREST RATE. The interest rate on this loan is subject to change from time to time based on changes in an index which is the WALL STREET JOURNAL PRIME RATE
(the “Index”). Lender will tell Borrower the current Index rate upon Borrower’s request. The interest rate change will not occur more often than each DAY. Borrower understands that Lender may make loans based on other rates as well.
The Index currently is 5.000% per annum. The interest rate to be applied to the unpaid principal balance of this loan will be calculated as described in the “INTEREST CALCULATION METHOD” paragraph using a rate equal to the Index,
resulting in an initial rate of 5.000% per annum based on a year of 360 days. NOTICE: Under no circumstances will the interest rate on this loan be more than the maximum rate allowed by applicable law. 
 INTEREST CALCULATION METHOD. Interest on this loan is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days,
multiplied by the outstanding principal balance, multiplied by the actual number of days the principal balance is outstanding. All Interest payable under this loan is computed using this method. 
 INTEREST AFTER DEFAULT. Upon default, including failure to pay upon final maturity, the interest rate on this loan shall be increased by adding a 5.000 percentage point
margin (“Default Rate Margin”). The Default Rate Margin shall also apply to each succeeding interest rate change that would have applied had there been no default. However, in no event will the interest rate exceed the maximum interest
rate limitations under applicable law. 
 LENDER’S RIGHTS. Upon Lender’s demand, Lender may declare the entire unpaid principal balance under this
Agreement and all accrued unpaid interest immediately due, and then Borrower will pay that amount. 
 ATTORNEYS’ FEES; EXPENSES. Lender may hire or pay
someone else to help collect this Agreement if Borrower does not pay. Borrower will pay Lender the reasonable costs of such collection. This includes, subject to any limits under applicable law, Lender’s attorneys’ fees and Lender’s
legal expenses, whether or not there is a lawsuit, including without limitation attorneys’ fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), and appeals. If not
prohibited by applicable law, Borrower also will pay any court costs, in addition to all other sums provided by law. 
 JURY WAIVER. Lender and Borrower
hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Borrower against the other. 
 GOVERNING LAW.
This Agreement will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the State of Colorado without regard to its conflicts of law provisions. This Agreement has been accepted by Lender in
the State of Colorado. 
 DISHONORED ITEM FEE. Borrower will pay a fee to Lender of $25.00 if Borrower makes a payment on Borrower’s loan and the check
or preauthorized charge with which Borrower pays is later dishonored. 
 RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right
of setoff in all Borrower’s accounts with Lender (whether checking, savings, or some other account). This includes all accounts Borrower holds jointly with someone else and all accounts Borrower may open in the future. However, this does not
include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law. Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the debt against any and all such
accounts. 
 LINE OF CREDIT. This Agreement evidences a straight line of credit. Once the total amount of principal has been advanced, Borrower is not
entitled to further loan advances. Advances under this Agreement, as well as directions for payment from Borrower’s accounts, may be requested orally or in writing by Borrower or by an authorized person. Lender may, but need not, require that
all oral requests be confirmed in writing. Borrower agrees to be liable for all sums either: (A) advanced in accordance with the instructions of an authorized person or (B) credited to any of Borrower’s accounts with Lender. The
unpaid principal balance owing on this Agreement at any time may be evidenced by endorsements on this Agreement or by Lender’s internal records, including daily computer print-outs. 
 CONTINUING VALIDITY. Except as expressly changed by this Agreement, the terms of the original obligation or obligations, including all agreements evidenced or securing the obligation(s), remain unchanged and in full
force and effect. Consent by Lender to this Agreement does not waive Lender’s right to strict performance of the obligation(s) as changed, nor obligate Lender to make any future change in terms. Nothing in this Agreement will constitute a
satisfaction of the obligation(s). It is the intention of Lender to retain as liable parties all makers and endorsers of the original obligationls), including accommodation parties, unless a party is expressly released by Lender in writing. Any
maker or endorser, including accommodation makers, will not be released by virtue of this Agreement. If any person who signed the original obligation does not sign this Agreement below, then all persons signing below acknowledge that this Agreement
is given conditionally, based on the representation to Lender that the non-signing party consents to the changes and provisions of this Agreement or otherwise will not be released by it. This waiver applies not only to any initial extension,
modification or release, but also to all such subsequent actions. 
 ADDITIONAL PROVISION. THIS CHANGE IN TERMS AGREEMENT IS MADE IN CONJUNCTION WITH LETTER
OF CREDIT NO. 1436, OR AS MAY BE AMENDED, EXTENDED OR RENEWED. 
 SUCCESSORS AND ASSIGNS. Subject to any limitations stated in this Agreement on transfer of
Borrower’s interest, this Agreement shall be binding upon and inure to the benefit of the parties, their successors and assigns. If ownership of the Collateral becomes vested in a person other than Borrower, Lender, without notice to Borrower,
may deal with Borrower’s successors with reference to this Agreement and the Indebtedness by way of forbearance or extension without releasing Borrower from the obligations of this Agreement or liability under the Indebtedness. 

 NOTIFY US OF INACCURATE INFORMATION WE REPORT TO CONSUMER REPORTING AGENCIES. Please notify us if we report any
inaccurate information about your accountlsi to a consumer reporting agency. Your written notice describing the specific inaccuracy(ies) should be sent to us at the following address: COLORADO BUSINESS BANK ATTN: LOAN OPERATIONS 821 17TH STREET
DENVER, CO 80202. 
 MISCELLANEOUS PROVISIONS. If any part of this Agreement cannot be enforced, this fact will not affect the rest of the Agreement. Lender
may delay or forgo enforcing any of its rights or remedies under this Agreement without losing them. Borrower and any other person who signs, guarantees or endorses this Agreement, to the extent allowed by law, waive presentment, demand for payment,
and notice of dishonor. Upon any change in the terms of this Agreement, and unless otherwise expressly stated in writing, no party who signs this Agreement, whether as maker, guarantor, accommodation maker or endorser, shall be released from
liability. All such parties agree that Lender may renew or extend 
  

					
	Loan No: 582956	 	 CHANGE IN TERMS AGREEMENT
 (Continued)
	 	

 parties also agree that Lender may modify this loan without the consent of or notice to anyone other than the
party with whom the modification is made. The obligations under this Agreement are joint and several. 
 PRIOR TO SIGNING THIS AGREEMENT, BORROWER READ AND
UNDERSTOOD ALL THE PROVISIONS OF THIS AGREEMENT, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS. BORROWER AGREES TO THE TERMS OF THE AGREEMENT. 
  

			
	BORROWER:
	
	ADA-ES, INC.
		
	By:	 	/s/ Richard Schlager
		 	RICHARD SCHLAGER, Vice President of ADA-ES, INC.

 ASSIGNMENT OF DEPOSIT ACCOUNT 
 References in the boxes above are for Lender’s use only and do not limit the applicability of this document to any particular loan or Item.  
 Any item above containing “ • •” has been omitted due to text length limitations. 
  

							
	Borrower:	  	ADA-ES, INC.	  	Lender:	  	COLORADO BUSINESS BANK
		  	8100 SOUTHPARK WY., UNIT B2	  		  	NORTHEAST
		  	LITTLETON, CO 80120	  		  	4695 QUEBEC ST.
		  		  		  	DENVER, CO 80216
				
	Grantor;	  	ADA ENVIRONMENTAL SOLUTIONS LLC	  		  	
		  	 8100 SOUTHPARK WY., UNIT 82
 LITTLETON, CO
80120
	  		  	

 THIS ASSIGNMENT OF DEPOSIT ACCOUNT dated August 15, 2008, Is tried* and executed among ADA ENVIRONMENTAL
SOLUTIONS LLC (“Grantor”); ADA-ES, INC. (“Borrower”); and COLORADO BUSINESS BANK (“Lender”). 
 ASSIGNMENT. For valuable
consideration, Grantor assigns and grants to Lender a security Interest in the Collateral, including without limitation the deposit accounts described below, to secure the Indebtedness and agrees that Lender shall have the rights stated in this
Agreement with respect to the Collateral, in addition to all other rights which tender may have by law. 
 COLLATERAL DESCRIPTION. The word
‘Collateral’ means the following described deposit account [‘Account”): 
 COLORADO BUSINESS BANK MONEY MARKET ACCOUNT NO. 7100701 with
Lender with an approximate balance of $4,086,595.49 
 together with (A) all interest, whether now accrued or hereafter accruing; (B) all
additional deposits hereafter made to the Account; (C) any and all proceeds from the Account; and (D) all renewals, replacements and substitutions for any of the foregoing. 
 In addition, the word “Collateral’ includes all of Grantor’s property (however owned if owned by more that one person or entity), In Lender’s possession (or in the possession of a third party
subject to Lander’s control), whether existing now or later and whether tangible or intangible In character, including without limitation each and all of the following: 
 (A) All property to which Lender acquires title or documents of title. 
 ID) AB property assigned to Lender. 
 IC) All promissory notes, bills of exchange, stock certificates, bonds,
savings passbooks, time certlficates of deposit, Insurance policies, and all other Instruments and evidences of an obligation. 
 (D) All
records relating to any of the property described In this Collateral section, whether in the form of writing, microfilm, microfiche, or electronic media. 
 BORROWER’S WAIVERS AND RESPONSIBILITIES. Except as otherwise required under this Agreement or by applicable law, 
 (A) Borrower agrees that
Lender need not tell Borrower about any action or inaction Lender takes in connection with this Agreement; (B) Borrower assumes the responsibility for being and keeping Informed about the Collateral; and (C) Borrower waives any defenses
that may arise because of any action or inaction of Lender, Including without limitation any failure of Lender to realize upon the Collateral or any delay by Lender In realizing upon the Collateral; and Borrower agrees to remain liable under the
Note no matter what action Lender lakes or fails to take under this Agreement. 
 GRANTOR’S REPRESENTATIONS AND WARRANTIES. Grantor warrants that:
(A) this Agreement is executed at Borrower’s request and not at the request of Lender; (B) Grantor has the full right, power and authority to enter into this Agreement and to pledge the Collateral to Lender; (C) Grantor has
established adequate means of obtaining from Borrower on a continuing basis Information about Borrower’s financial condition; and (D) Lender has made no representation to Grantor about Borrower or Borrower’s creditworthiness.

 GRANTOR’S WAIVERS. Grantor waives all requirements of presentment, protest, demand, and notice of dishonor or non-payment to Borrower or Grantor, or
any other party to the Indebtedness or the Collateral. Lender may do any of the following with respect to any obligation of any Borrower, without first obtaining the consent of Grantor: (A) grant any extension of time for any payment,
(B) grant any renewal, (C) permit any modification of payment terms or other terms, or ID) exchange or release any Collateral or other security. No such act or failure to act shall affect Lender’s rights against Grantor or the
Collateral. 
 RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff In all Grantor’s accounts with Lender
(whether checking, savings, or some other account). This includes all accounts Grantor holds jointly with someone else and all accounts Grantor may open in the future. However, this does not include any IRA or Keogh accounts, or any trust accounts
for which setoff would be prohibited by law. Grantor authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the Indebtedness against any and all such accounts. 
 GRANTOR’S REPRESENTATIONS AND WARRANTIES WITH RESPECT TO THE COLLATERAL. With respect to the Collateral, Grantor represents and promises to Lender that: 

Ownership. Grantor is the lawful owner of the Collateral free and clear of all loans, lions, encumbrances, and claims except as disclosed to and
accepted by Lender in writing. 
 Right to Grant Security Interest. Grantor has the full right, power, and authority to enter into this
Agreement and to assign the Collateral to Lender. 
 No Prior Assignment, Grantor has not previously granted a security interest in the
Collateral to any other creditor. 
 No Further Transfer. Grantor shell not sell, assign, encumber, or otherwise dispose of any of
Grantor’s rights in the Collateral except as provided in this Agreement. 
 No Defaults. There are no defaults relating to the
Collateral, and there are no offsets or counterclaims to the same. Grantor will strictly and promptly do everything required of Grantor under the terms, conditions, promises, and agreements contained in or relating to the Collateral. 
 Proceeds, Any and all replacement or renewal certificates, instruments, or other benefits or proceeds related to the Collateral that are received by
Grantor shall be held by Grantor in trust for Lender and Immediately shall be delivered by Grantor to Lender to be held as part of the Collateral. 
 Validity; Binding Effect. This Agreement is binding upon Grantor and Grantor’s successors and assigns and Is legally enforceable in accordance with Its terms. 
 Financing Statements. Grantor authorizes Lender to file a UCC financing statement, or alternatively, a copy of this Agreement to perfect Lender’s
security interest. At Lender’s request, Grantor additionally agrees to sign all other documents that are necessary to perfect, protect, and continue Lender’s security Interest in the Property. Grantor will pay all filing fees, title
transfer 

 
fees, and other fees and costs involved unless prohibited by law or unless Lender is required by low to pay such fees and costs. Grantor irrevocably appoints
Lender to execute documents necessary to transfer title if there is a default. Lender may file a copy of this Agreement as a financing statement. If Grantor changes Grantor’s name or address, or the name or address of any person granting a
security Interest under this Agreement changes, Grantor will promptly notify the Lander of such change. 
 LENDER’S RIGHTS AND OBLIGATIONS WITH RESPECT
TO THE COLLATERAL, While this Agreement is in effect, Lender may retain the rights to possession of the Collateral, together with any and all evidence of the Collateral, such as certificates or passbooks. This Agreement win remain in effect until
(a) there no longer is any Indebtedness owing to Lender; (bl all other obligations secured by this Agreement have been fulfilled; and Ic) Grantor, In writing, has requested from Lender a release of this Agreement. 
 LENDER’S EXPENDITURES. N any action or proceeding is commenced that would materially affect Lender’s interest in the Collateral or if Grantor fails to comply
with any provision of this Agreement or any Related Documents, including but not limited to Grantor’s failure to discharge or pay when due any amounts Grantor is required to discharge or pay under this Agreement or any Related Documents, Lender
on Grantor’s behalf may (but shall not be obligated to) take any action that Lender deems appropriate, 

 
including but not limited to discharging or 
  

					
	Loan No: 582956	  	 ASSIGNMENT OF DEPOSIT ACCOUNT
 (Continued)
	  	

 paying all taxes, liens, security Interests, encumbrances and other claims, at any time levied or placed on the
Collateral and paying all costs for Insuring, maintaining and preserving the Collateral. All such expenditures incurred or paid by Lender for such purposes will then bear interest at the rate charged under the Note from the date incurred or paid by
Lender to the date of repayment by Grantor. All such expenses will become a part of the Indebtedness and, at Lender’s option, will IA) be payable on demand; (8) be added to the balance of the Note and be apportioned among and be payable
with any Installment payments to become due during either (1) the term of any applicable Insurance policy; or (2) the remaining term of the Note; or (C) be treated as a balloon payment which will be due and payable at the Note’s
maturity. The Agreement also will secure payment of these amounts, Such right shell be in addition to all other rights and remedies to which Lender may be entitled upon Default. 
 LIMITATIONS ON OBLIGATIONS OF LENDER. Lender shall use ordinary reasonable care in the physical preservation and custody of any certificate or passbook for the Collateral but shall have no other obligation to protect
the Collateral or its value. In particular, but without limitation, Lender shall have no responsibility (A) for the collection or protection of any income on the Collateral; (B) for the preservation of rights against issuers of the
Collateral or against third persons; (CI for ascertaining any maturities, conversions, exchanges, offers, tenders, or similar matters relating to the Collateral; nor (D) for Informing the Grantor about any of the above, whether or not Lender
has or is deemed to have knowledge of such matters. 
 DEFAULT. Default will occur if payment In full is not made immediately when due. 
 RIGHTS AND REMEDIES ON DEFAULT. Upon Default, or at any time thereafter. Lender may exercise any one or more of the following rights and remedies, In addition to any
rights or remedies that may be available at law, in equity, or otherwise; 
 Accelerate Indebtedness. Lender may declare all Indebtedness of
Borrower to Lender immediately due and payable, without notice of any kind to Borrower or Grantor. 
 Application of Account Proceeds. Lender
may take directly all funds in the Account and apply them to the Indebtedness. If the Account is subject to an early withdrawal penalty, that penalty shall be deducted from the Account before its application to the Indebtedness, whether the Account
is with Lender or some other institution. Any excess funds remaining after application of the Account proceeds to the Indebtedness will be paid to Borrower or Grantor as the Interests of Borrower or Grantor may appear. Borrower agrees, to the extent
permitted by law, to pay any deficiency after application of the proceeds of the Account to the Indebtedness. Lender also shall have all the rights of a secured party under the Colorado Uniform Commercial Code, even If the Account Is not otherwise
subject to such Code concerning security Interests, and the parties to this Agreement agree that the provisions of the Code giving rights to a secured party shall nonetheless be a part of this Agreement. 
 Transfer Title. Lender may effect transfer of title upon sale of all or part of the Collateral. For this purpose, Grantor irrevocably appoints Lender as
Grantor’s attorney-in-fact to execute endorsements, assignments and Instruments in the name of Grantor and each of them (if more than one) as shag be necessary or reasonable. 
 Other Rights and Remedies. Lender shell have and may exercise soy or all of the rights and remedies of a secured creditor under the provisions of the
Colorado Uniform Commercial Code, at law, in equity, or otherwise. 
 Deficiency Judgment, If permitted by applicable law, Lender may obtain a
judgment for any deficiency remaining In the Indebtedness due to Lender after application of all amounts received from the exercise of the rights provided in this section, 
 Election of Remedies. Except as may be prohibited by applicable law, all of Lender’s rights and remedies, whether evidenced by this Agreement or by any other writing, shall be cumulative and may be exercised
singularly or concurrently. Election by Lender to pursue any remedy shell not exclude pursuit of any other remedy, and an election to make expenditures or to take action to perform an obligation of Grantor under this Agreement, after Grantor’s
failure to perform, shall not affect Lander’s right to declare a default and exercise its remedies. 
 Cumulative Remedies. All of
Lender’s rights and remedies, whether evidenced by this Agreement or by any other writing, shall be cumulative and may be exercised singularly or concurrently. Election by Lander to pursue any remedy shall not exclude pursuit of any other
remedy, and an election to make expenditures or to take action to perform an obligation of Grantor under this Agreement, after Grantor’s failure to perform, shall not affect Lender’s right to declare a default and to exercise its remedies.

 MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Agreement: 
 Amendments, This Agreement, together with any Related Documents, constitutes the entire understanding and agreement of the parties as to the matters set
forth in this Agreement. No alteration of or amendment to this Agreement shall be effective unless given In writing and signed by the party or parties sought to be charged or bound by the alteration or amendment. 
 Attorneys’ Fees; Expenses. Grantor agrees to pay upon demand all of Lender’s reasonable costs and expenses, including Lender’s
attorneys’ fees and Lender’s legal expenses, Incurred in connection with the enforcement of this Agreement. Lender may hire or pay someone else to help enforce this Agreement, and Grantor shall pay the reasonable costs and expenses of such
enforcement. Costs and expenses Include Lender’s attorneys’ fees and legal expenses whether or not there Is a lawsuit, including attorneys’ fees and legal expenses for bankruptcy proceedings (including efforts to modify or vacate any
automatic stay or injunction), appeals, and any anticipated post-judgment collection services. Grantor also shall pay all court costs and such additional lees as may be directed by the court. 
 Caption Headings. Caption headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the provisions of
this Agreement. 
 Governing Law. This Agreement will be governed by federal law applicable to Lander and, to the extent not preempted by
federal law, the laws of the State of Colorado without regard to Its conflicts of law provisions. This Agreement has been accepted by Lender in the State of Colorado. 
 Joint and Several Liability. All obligations of Borrower and Grantor under this Agreement shall be joint and several, and all references to Grantor shall mean each and every Grantor, and all references to Borrower
shall mean each and every Borrower. This means that each Borrower and Grantor signing below is responsible for all obligations in this Agreement. Where any one or more of the parties Is s corporation, partnership, limited liability company or
similar entity, It Is not necessary for Lender to Inquire Into the powers of any of the officers, directors, partners, members, or other agents acting or purporting to act on the entity’s behalf, and any obligations made or created in reliance
upon the professed exercise of such powers shall be guaranteed under this Agreement. 
 No Waiver by Lander. Lender shall not be deemed to
have waived any rights under this Agreement unless such waiver Is given in writing and signed by Lender, No delay or omission on the part of Lender in exercising any right shall operate as a waiver of such right or any other right. A waiver by
Lender of a provision of this Agreement shall not prejudice or constitute a waiver of Lender’s right otherwise to demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by Lender, nor any course
of dealing between Lender and Grantor, shall constitute a waiver of any of Lender’s rights or of any of Grantor’s obligations as to any future transactions. Whenever the consent of Lender is required under this Agreement, the granting of
such consent by Lender in any instance shall not constitute continuing consent to subsequent Instances where such consent is required and in all cases such consent may be granted or withhold in the sole discretion of Lender. 

 Notices. Any notice required to be given under this Agreement shall be given In writing, and shall be
effective when actually delivered, when actually received by telefacsimile (unless otherwise required by law), when deposited with a nationally recognized overnight courier, or, if mailed, when deposited in the United States mail, as first class,
certified or registered mail postage prepaid, directed to the addresses shown near the beginning of this Agreement. Any party may change Its address for notices under this Agreement by giving formal written notice to the other parties, specifying
that the purpose of the notice is to change the party’s address. For notice purposes, Grantor agrees to keep Lander informed at all times of Grantor’s current address. Unless otherwise provided or required by law, if there is more than one
Grantor, any notice given by Lender to any Grantor is deemed to be notice given to all Grantors. 
 Power of Attorney. Grantor hereby appoints
Lender as its true and lawful attorney-in-fact, Irrevocably, with full power of substitution to do the following: (1) to demand, collect, receive, receipt for, sue and recover all sums of money or other property which may now or hereafter
become due, owing or payable from the Collateral; (2) to execute, sign and endorse any and all claims, Instruments, receipts, checks, drafts or warrants issued in payment for the Collateral; (3) to settle or compromise any end all claims
arising under the Collateral, and In the place and stead of Grantor, to execute and deliver its release and settlement for the claim; and (4) to file any claim or claims or to take any action or institute or take pert in any proceedings, either
In its own name or In the name of Grantor, or otherwise, which in the discretion of Lender may seem to be necessary or advisable. This power is given as security for the Indebtedness, and the authority hereby conferred is and shall be irrevocable
and shall remain In full force and effect until renounced by Lender. 
 Severability. If a court of competent jurisdiction finds any provision
of this Agreement to be illegal, invalid, or unenforceable as to any circumstance, that finding shall not make the offending provision illegal, invalid, or unenforceable as to any other circumstance. If feasible, the offending provision shall be
considered modified so that it becomes legal, valid and enforceable. If the offending provision cannot be so modified, it shall be considered deleted from this Agreement. Unless otherwise required by law, the illegality, invalidity, or
unenforceability of any provision of this Agreement shall not affect the legality, validity or enforceability of any other provision of this Agreement. 

					
	Loan No: 582956	  	 ASSIGNMENT OF DEPOSIT ACCOUNT
 (Continued)
	  	

 Successors and Assigns. Subject to any limitations stated In this Agreement on transfer of
Grantor’s Interest, this Agreement shall be binding upon and Inure to the benefit of the parties, their successors and assigns. If ownership of the Collateral becomes vested in a person other than Grantor, Lender, without notice to Grantor, may
deal with Grantor’s successors with reference to this Agreement and the Indebtedness by way of forbearance or extension without releasing Grantor from the obligations of this Agreement or liability under the Indebtedness. 
 Survival of Representations and Warranties. All representations, warranties, and agreements made by Grantor in this Agreement shall survive the execution
and delivery of this Agreement, shell be continuing in nature, and shall remain in full force and effect until such time as Borrower’s Indebtedness shall be paid in lull. 
 Time Is of the Essence. Time is of the essence in the performance of this Agreement, 
 Waive Jury. All parties to this Agreement hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by any party against
any other party. 
 DEFINITIONS. The following capitalized words and terms shall have the following meanings when used In this Agreement. Unless specifically
stated to the contrary, all references to dollar amounts shall mean amounts in lawful money of the United States of America. Words and terms used in the singular shall Include the plural, and the plural shall include the singular, as the context may
require. Words and terms not otherwise defined in this Agreement shall have the meanings attributed to such terms in the Uniform Commercial Code: 
 Account. The word “Account” means the deposit account described in the “Collateral Description’ section. 
 Agreement. The word ‘Agreement” means this Assignment of Deposit Account, as this Assignment of Deposit Account may be amended or modified from time to time, together with all exhibits and schedules attached to this Assignment of
Deposit Account from time to time. 
 Borrower. The word ‘Borrower’ means ADA-ES, INC. and includes all co-signers and co-makers
signing the Note and all their successors and assigns. 
 Collateral. The word “Collateral’ means all of Grantor’s right, title
and Interest in and to all the Collateral as described In the Collateral Description section of this Agreement. 
 Default. The word
“Default” means the Default set forth In this Agreement in the section tided “Default”. Grantor. The word “Grantor” means ADA ENVIRONMENTAL SOLUTIONS LLC. 
 Indebtedness. The word “Indebtedness” means the indebtedness evidenced by the Note or Related Documents, including all principal and Interest
together with all other indebtedness and costs and expenses for which Borrower is responsible under this Agreement or under any of the Related Documents. 
 Lender. The word “Lender” means COLORADO BUSINESS BANK, its successors and assigns. 
 Note. The
word ‘Note’ means the Note executed by ADA-ES, INC. In the principal amount of $4,000,000.00 dated August 15, 2008, together with all renewals of, extensions of, modifications of, refinancings of, consolidations of, and substitutions
for the note or credit agreement. 
 Property. The word ‘Property” means all of Grantor’s right, title and interest in end to
all the Property as described in the ‘Collateral Description’ section of this Agreement. 
 Related Documents, The words
‘Related Documents” mean all promissory notes, credit agreements, loan agreements, environmental agreements, guaranties, security agreements, mortgages, deeds of trust, security deeds, collateral mortgages, and all other instruments,
agreements and documents, whether now or hereafter existing, executed in connection with the Indebtedness, 
 BORROWER AND GRANTOR HAVE READ AND UNDERSTOOD
ALL THE PROVISIONS OF THIS ASSIGNMENT OF DEPOSIT ACCOUNT AND AGREE TO ITS TERMS. THIS AGREEMENT IS DATED AUGUST 15, 2008. 
  

			
	Grantor
	
	ADA Environmental Solutions LLC
		
	By:	 	/s/ Mark H. McKinnies
		 	MARK H. McKINNIES, Manager of ADA Environmental Solutions, LLC

  

			
	Borrower
	
	ADA-ES, Inc.
		
	By:	 	/s/ Mark H. McKinnies
		 	MARK H. McKINNIES, Chief Financial Officer of ADA-ES, INC.

 Colorado Business Bank 
  

					
		  		  	 4695 Quebec Street
 Denver, CO 80216
 CoBizBank.com

	BENEFICIARY:	  	BE&K CONSTRUCTION COMPANY, LLC	  	
		  	2000 INTERNATIONAL PARK DRIVE BIRMINGHAM, ALABAMA 35243	  	

 IRREVOCABLE STANDBY LETTER OF CREDIT NUMBER 1436  
 We Colorado Business Bank hereby establish in favor of BE&K CONSTRUCTION COMPANY, LLC the (“Beneficiary”) at the request of and for the account of RED
RIVER ENVIRONMENTAL PRODUCTS, LLC c/o ADA ENVIRONMENTAL SOLUTIONS LLC (the “Client”) our Irrevocable Standby Letter of Credit No. 1436 (“Letter of Credit”) in the amount of (US$4,000,000 (four million dollars and no
cents) (the “Stated Amount”) in reference to that certain Letter Agreement, by and between Client and Beneficiary, dated August 15, 2008 (the “Agreement’) effective immediately. This Letter of Credit shall automatically
expire at the earlier of the close of business at 3:00 p.m. Mountain Time on February 28, 2009 (or such later date to which this Letter of Credit may be extended in accordance with the provisions allowing for such extension set forth below),
upon which time this Letter of Credit shall be cancelled. 
 The Letter of Credit shall be deemed automatically extended without amendment for additional
periods of one (1) year each from the present or any future expiration date, unless at least sixty (60) days prior to any such expiration date we shall notify Beneficiary, by registered mail or overnight courier at the address below, that
we elect not to consider this Letter of Credit extended for any such additional one (1) year period. This Letter of Credit shall have a full and final maturity date of August 15, 2009. 
 Partial drawings are allowed, not to exceed in aggregate the amount of the Letter of Credit. The Stated Amount shall be immediately and permanently reduced by the amount
of each drawing hereunder. 
 821 17th Street, Loan Operations Department 3`d Floor, Denver, CO 80202 mentioning thereon our Letter of Credit No.1436
accompanied by the following documentation: 
 A written notice, stating explicitly: 
 “The undersigned hereby certifies that (a) I am a duly authorized officer of BE&K Construction Company, LLC, the Beneficiary under this
Letter of Credit, (b) the amount of the draft accompanying this certificate is due, owing and undisputed pursuant to the Letter Agreement and (c) such amount has not been paid under the terms and conditions of the Letter Agreement.”

 accompanied by: 
 (x) a Draw Certificate
executed by an authorized person in the form of Attachment A hereto (the “Draw Certificate”), appropriately completed and purportedly signed by Beneficiary’s authorized officer and 
 (y) a draft in the form of Attachment B hereto (the “Draft”), appropriately completed and purportedly signed by Beneficiary’s
authorized officer. 

 All drafts drawn hereunder must be accompanied by this Letter of Credit. Drawings by facsimile are permitted. We hereby
undertake to honor upon presentation drafts drawn and presented to us in compliance with the terms of this Letter of Credit, without offset. All fees associated with this credit are to Client’s account. 
 We hereby agree to honor a drawing hereunder made in compliance with this Letter of Credit by transferring in immediately available funds the amount
specified in the draft delivered to us in connection with such drawing to such account at such bank in the United States as Beneficiary may specify in its Draw Certificate at the opening of business on the second Business Day next succeeding the
date of presentation of the Draw Certificate. In clarification, we agree to honor the Draw Certificate upon receipt thereof, without regard to the truth or falsity of the assertions made therein. 
 If a demand for payment made by Beneficiary hereunder does not, in any instance, conform to the terms and conditions of this Letter of Credit, we shall
give Beneficiary prompt notice that the demand for payment was not effected in accordance with the terms and conditions of this Letter of Credit, stating the reasons therefor and that we will upon Beneficiary’s instructions hold any documents
at Beneficiary’s disposal or return the same to Beneficiary. Upon being notified that the demand for payment was not affected in conformity with this Letter of Credit, Beneficiary may attempt to correct any such non- conforming demand.

 EXCEPT AS EXPRESSLY STATED HEREIN, THIS UNDERTAKING IS NOT SUBJECT TO ANY AGREEMENT, REQUIREMENT OR QUALIFICATION. THE OBLIGATION OF
COLORADO BUSINESS BANK UNDER THIS CREDIT IS THE INDIVIDUAL OBLIGATION OF COLORADO BUSINESS BANK AND IS IN NO WAY CONTINGENT UPON REIMBURSEMENT WITH RESPECT THERETO, OR UPON THE ABILITY OF COLORADO BUSINESS BANK TO PERFECT ANY LIEN, SECURITY INTEREST
OR ANY OTHER REIMBURSEMENT. 
 All communications to Beneficiary in respect of this Letter of Credit shall be in writing and shall be
delivered to the address below (or such other address as may from time to time be designated by Beneficiary in a written notice to us, conspicuously stating, and confirming, similar notice to Client). 
 BE&K Construction Company, LLC 
 2000
International Park Drive 
 Birmingham, Alabama 35243 
 We shall not authorize any transfer of this Letter of Credit. 
 This Letter of Credit is subject to the
Uniform Customs and Practice for Documentary Credits (2007 Revision), International Chamber of Commerce, Publication No. 600 (“UCP”). As to matters not covered by the UCP, this Letter of Credit shall be governed by and construed in
accordance with the law of the State of Colorado. In the event of any conflict between a provision of the UCP or such law and a provision in this Letter of Credit, such provision of this Letter of Credit shall govern. 
  

			
	Colorado Business Bank:
		
	By:	 	/s/ Lisa Meireis
		 	Lisa Meireis
		 	Vice President

 ATTACHMENT A 
 FORM OF DRAW CERTIFICATE 
 The undersigned hereby certifies to Colorado Business Bank (the “Issuer”), with
reference to Irrevocable Letter of Credit No. 1436 (the “Letter of Credit”) issued by Issuer in favor of the undersigned (“Beneficiary”) (capitalized terms used herein and not defined herein shall have the respective
meanings set forth in the Letter of Credit), as follows: 
  

	(1)	The undersigned is the of Beneficiary and is duly authorized by Beneficiary to execute and deliver this Certificate on behalf of Beneficiary. 

  

	and	

  

	(2)	Beneficiary hereby makes. demand against the Letter of Credit by Beneficiary’s presentation of the draft accompanying this Certificate, for payment of
(U.S.$             ), such amount, when aggregated together with any amount not drawn down, is not in excess of
1__________________________($                         )](as in effect of the date hereof). 

 and 
  

	(3)	Beneficiary is entitled to draw the amount set forth in paragraph 2 hereof because the conditions for a drawing pursuant to the Agreement have been met. 

  

	(4)	Issuer is hereby directed to make payment of the requested drawing to: (insert wire instructions) 

  

			
	Beneficiary Name and Address.
		
	By:	 	 
	Title:	 	 
	Date:	 	 

 ATTACHMENT B 
 DRAWING UNDER IRREVOCABLE LETTER OF CREDIT NO. 1436 
 Date: 
 On:         [The second Business Day immediately succeeding the date of presentation] 
 PAY TO:         BE&K Construction Company, LLC 
 U.S. 
 FOR VALUE RECEIVED AND CHARGE TO THE ACCOUNT OF LETTER OF CREDIT NO. 1436. 
  

			
	BE&K Construction Company, LLC
		
	By:	 	 
	Title:	 	
	Date:Carbon Supply Agreement

 Exhibit 10.49 
 September 3, 2008 
 CARBON SUPPLY AGREEMENT 
 BETWEEN 
 RED RIVER ENVIRONMENTAL
PRODUCTS, LLC 
 SELLER 
 AND 
 LUMINANT GENERATION COMPANY LLC 
 BUYER 
 Dated as of September 3, 2008 
 * indicates portions of the exhibit that have been omitted pursuant to a request for confidential information. The non-public information has been filed with the
Commission. 

 September 3, 2008 
 TABLE OF CONTENTS 
  

					
	 	 	 	  	Page
	SECTION 1.	 	DEFINED TERMS	  	1
			
	SECTION 2.	 	CONTRACT TERM	  	5
		
	 2.1      Effective Date
	  	5
		
	 2.2      Starting Delivery Date
	  	5
		
	 2.3      Term
	  	5
		
	 2.4      Term Extensions
	  	5
			
	SECTION 3.	 	OUTLINE OF THE OBLIGATIONS OF THE PARTIES	  	
		
	 3.1      Purpose
	  	6
		
	 3.2      Obligations of Seller or Seller’s Affiliate(s)
	  	6
		
	 3.3      Obligations of Buyer
	  	6
			
	SECTION 4.	 	CARBON QUANTITIES AND DELIVERY SCHEDULES	  	7
		
	 4.1      Quantity Obligations
	  	7
		
	 4.2      Nominations
	  	8
		
	 4.3      Poundage Variations
	  	8
		
	 4.4      Additional Pounds
	  	8
			
	SECTION 5.	 	PRODUCT WARRANTY AND PERFORMANCE GUARANTY	  	8
		
	 5.1      Warranty
  
 5.2      Performance Benchmark

	  	8
	  	9
			
	SECTION 6.	 	SOURCE OF CARBON	  	9
		
	 6.1      Source of Carbon
	  	9
			
	SECTION 7.	 	DELIVERY OF CARBON	  	10

  

 Page i 

 September 3, 2008 
  

					
	 7.1      Delivery Terms
	  	10
		
	 7.2      Title and Risk of Loss
	  	10
			
	SECTION 8.	 	TRANSPORTATION OBLIGATIONS	  	10
		
	 8.1      Transport
	  	10
			
	SECTION 9.	 	PRICE OF CARBON	  	11
		
	 9.1      Contract Price
	  	11
		
	 9.2      Calculation of Base Price
	  	11
		
	    9.2.1     Base Price	  	11
		
	    9.2.2     * Adjustment	  	11
		
	    9.2.3     Notice of Calculations	  	12
		
	 9.3      Taxes, Fees and Royalties
	  	12
		
	 9.4      Annual Reconciliation of Carbon Purchase Quantity
	  	12
		
	 9.5      Rounding
	  	12
		
	 9.6      End of Term Reconciliation of Carbon Purchased Versus Carbon Purchase
Commitment
	  	12
		
	 9.7      *
	  	13
			
	SECTION 10.	 	INVOICING AND PAYMENT	  	13
		
	 10.1    Invoicing Procedures
	  	13
		
	 10.2    Payment Procedures
	  	13
		
	 10.3    Disputed Invoices
	  	13
			
	SECTION 11.	 	COMPLIANCE WITH LAWS	  	13
		
	 11.1    Construction
	  	13
		
	 11.2    Severability
	  	14
			
	SECTION 12.	 	WEIGHING, SAMPLING, AND ANALYSIS	  	14
		
	 12.1    Procedures
	  	14
		
	 12.2    Duties to Sample Carbon
	  	14

  

 Page ii 

 September 3, 2008 
  

					
	 12.3    Duties of Seller to Weigh Carbon.
	  	14
		
	    12.3.1    Duty to Weigh; Use of Weighing Data	  	14
		
	    12.3.2    Inspection and Certification of Scales	  	14
		
	    12.3.3    Seller’s Certification of Scales and Weights; Correction of Errors	  	15
		
	 12.4    Failure of Weighing, Sampling or Analytical Procedures.
	  	15
		
	     12.4.1    SubstituteProcedures
	  	15
		
	     12.4.2    Inaccurateor Unreliable Sample or Final Analysis
	  	15
		
	 12.5    Rights of Buyer and Seller in Weighing, Sampling and Analysis.
	  	15
		
	     12.5.1    Resultsof Sampling and Analysis Binding
	  	15
		
	     12.5.2    IndependentAnalysis of Samples
	  	15
		
	     12.5.3    RefereeAnalysis
	  	16
		
	     12.5.4    Observationof Sampling and Analysis
	  	16
			
	SECTION 13.	 	RECORDS AND AUDITS	  	16
		
	 13.1    Record Review.
	  	16
		
	    13.1.1    Records of Seller	  	16
		
	    13.1.2    Records of Buyer	  	16
		
	    13.1.3    Overpayment or Underpayment	  	16
		
	 13.2    Timing of Record Review
	  	16
			
	SECTION 14.	 	FORCE MAJEURE	  	17
		
	 14.1    Definition of Force Majeure
	  	17
		
	 14.2    Effect of Force Majeure
	  	17
			
	SECTION 15.	 	EVENTS OF DEFAULT; REMEDIES	  	17
		
	 15.1    Event of Default
	  	17
		
	    15.1.1    Payment Default	  	17
		
	    15.1.2    Failure to Meet Milestone Schedules.	  	18

  

 Page iii 

 September 3, 2008 
  

					
	    15.1.3    Failure to Perform Material Provisions	  	18
		
	    15.1.4    Continued Failure to Supply	  	18
		
	 15.2    Remedies for Default and Event(s) of Default
	  	18
		
	 15.3    Extension of Cure Periods.
	  	20
		
	 15.5    Waiver of Breach
	  	21
		
	 15.6    Seller’s Right to Suspend Deliveries
	  	21
		
	 15.7    Limitation of Liabilities
	  	21
		
	 15.8    Intellectual Property
	  	22
			
	SECTION 16.	  	CHOICE OF LAW	  	22
		
	 16.1    Choice of Law
	  	22
			
	SECTION 17.	  	ASSIGNMENTS AND COOPERATION WITH FINANCING	  	22
		
	 17.1    Assignment Not Allowed
	  	22
		
	 17.2    Assignment to Affiliate
	  	22
		
	 17.3    Assignment for Financing
	  	23
		
	 17.4    Successors and Assigns
	  	23
		
	 17.5    Cooperation with Financing
	  	23
			
	SECTION 18.	  	CONFIDENTIALITY	  	23
			
	SECTION 19.	  	NOTICES	  	24
		
	 19.1    General Notices
	  	24
		
	 19.2    Effectiveness
	  	25
		
	 19.3    Changes in Persons and Addresses
	  	25
			
	SECTION 20.	  	WAIVERS	  	25
			
	SECTION 21.	  	HEADINGS AND SECTION NUMBERS - CONSTRUCTION	  	25
		
	 21.1    Headings Not to Affect Construction
	  	25

  

 Page iv 

 September 3, 2008 
  

					
	 21.2    References to Section Numbers
	  	25
			
	SECTION 22.	  	AMENDMENTS	  	25
			
	SECTION 23.	  	COMPLETE AGREEMENT	  	26
			
	SECTION 24.	  	COUNTERPARTS	  	26
			
	SECTION 25.	  	SECURITY	  	
			
	SECTION 26.	  	INDEMNITY	  	

  

			
	EXHIBIT 1	  	Carbon Specifications
	EXHIBIT 1A	  	Manufactured Carbon Sampling and Testing Protocols
	EXHIBIT 1B	  	Processed Carbon Sampling and Testing Protocols
	EXHIBIT 2	  	Carbon Purchase Commitment
	EXHIBIT 2A	  	Call Option Commitment
	EXHIBIT 3	  	Base Price
	EXHIBIT 4	  	Milestones
	EXHIBIT 5	  	Cost Methodology for Delivery of Carbon by Seller to Buyer’s Facility
	EXHIBIT 6	  	Form of Parent Guarantee
	EXHIBIT 7A1	  	Form of Seller’s $1 Million Letter of Credit
	EXHIBIT 7A2	  	Form of Seller’s $10 Million Letter of Credit
	EXHIBIT 7B	  	Form of Buyer’s Letter of Credit
	EXHIBIT 8	  	List of Buyer’s Facilities
	EXHIBIT 9	  	Early Termination Schedule

  

 Page v 

 CARBON SUPPLY AGREEMENT 
 This CARBON SUPPLY AGREEMENT (this “Agreement”) is made and entered into as of the 3rd day of September, 2008, by and between Red
River Environmental Products, LLC, a Delaware limited liability company (“Seller”), and Luminant Generation Company LLC, a Texas limited liability company (“Buyer”). Together, Seller and Buyer are
“Parties” to this Agreement and either Seller or Buyer individually is a “Party” to this Agreement. 
 RECITALS 
 WHEREAS, Seller is developing an activated carbon manufacturing facility in Coushatta, Louisiana which is
targeted to commence operations in the first quarter of 2010; 
 WHEREAS, Seller desires to fulfill its obligations under this Agreement
(i) by manufacturing Carbon at its Louisiana facility or an Alternative Source and (ii) by selling such Carbon to Buyer in accordance with the terms, and subject to the conditions, of this Agreement; and 
 WHEREAS, Buyer desires to purchase from Seller, and Seller desires to sell to Buyer, Carbon in the amounts and upon the terms and conditions set forth in
this Agreement. 
 AGREEMENT 
 NOW THEREFORE, in consideration of the mutual covenants and obligations stated in this Agreement, the receipt and sufficiency of which the Parties acknowledge, Seller and Buyer hereby agree as follows: 
 SECTION 1. DEFINED TERMS 
 The words and phrases
listed in Section 1 shall have the meanings ascribed to them in Section 1 wherever they appear in this Agreement as defined terms, which shall be indicated by initial capital letters in each word. Capitalized words and phrases contained in
this Agreement that are not listed in Section 1 of this Agreement shall be defined in the particular Section(s) in which they are used. 
 “Actual Carbon Purchase” shall have the meaning given in Section 9.6. 
 “Additional Pounds” shall have the
meaning given in Section 4.4. 
 “Adjustment Index” shall mean the index described in Section 9.2.2. 
 “Affiliate” with respect to any specified Person shall mean any other Person or entity with control over or subject to control by, or under direct or
indirect common control with, such specified Person. For purposes of this definition, “control” when used with respect to a specific Person (including the Parties) means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by contract, or otherwise. Notwithstanding the foregoing, in no event shall either Party be deemed an Affiliate of the other Party for the purposes of this Agreement.

  

 1 

 “Agreement” shall mean this Carbon Supply Agreement and all modifications and supplements hereto
implemented in accordance with this Agreement. 
 “Alternate Source(s)” shall have the meaning set forth in Section 6.1 and shall be a
source or sources from which Seller will provide Carbon other than Carbon produced by Seller at Seller’s Facility. 
 “Annual Delivered
Amount” shall have the meaning given in Section 9.4. 
 “Annual Maximum” shall have the meaning given in Section 4.2.

 “Annual Minimum” shall have the meaning given in Section 4.2. 
 “Annual Nomination” refers to the total number of pounds of Carbon that Buyer instructs Seller to deliver during each Contract Year, in accordance with Section 4.2 of this Agreement. 

“Annual Shortfall” shall have the meaning given in Section 9.4. 
 “Applicable Laws” shall mean any laws, statutes, ordinances, regulations, rules, notice requirements, court decisions, agency guidelines, permits, principles of law and orders of any Governmental
Authority which are applicable to Buyer or Seller, whichever the case may be. 
 “ASTM” shall have the meaning given in Section 12.2.

 “Base Price” shall have the meaning given in Section 9.2.1. 
 “Business Day” shall mean any Day other than a Legal Holiday. 
 “Buyer” shall have the
meaning set forth in the Preamble to this Agreement and includes Buyer’s successors and permitted assigns under this Agreement. 
 “Buyer
Group” shall mean Buyer, its officers, directors, employees, and agents, and each of its Affiliates and each of their respective officers, directors, employees and agents. 
 “Buyer’s Facility” shall mean any one or more of the power generation facilities listed in Exhibit 8. 
 “Buyer’s Letter of Credit” shall have the meaning given in Section 25.3. 
 “Buyer’s Letter of Credit
Amount” shall have the meaning given in Section 25.3. 
 “Carbon” shall mean the powdered activated carbon supplied by Seller
to Buyer hereunder, which conforms to the Specifications. 
 “Carbon Purchase Commitment” shall have the meaning given in Section 4.1.

  

 2 

 “Claims” shall have the meaning given in Section 26.1. 
 “Contract Price” shall have the meaning given in Section 9.1. 
 “Contract Year” shall mean (i) the period beginning on the Day on which Buyer first takes Carbon pursuant to this Agreement and ending on December 31 of such calendar year for the first Contract Year, and
(ii) for each other calendar year during the Term, the annual period beginning on January 1 and ending on December 31 of such calendar year except that if this Agreement is terminated in accordance with the terms hereof in the middle
of the year, the last Contract Year ends on the effective date of termination. 
 “Cover Standard for Buyer” shall have the meaning given in
Section 15.2.1.1. 
 “Cover Standard for Seller” shall have the meaning given in Section 15.2.1.2. 
 “CPI-U” shall have the meaning given in Section 9.2.2. 
 “Credit Agreement” shall mean the agreement between Seller and the entity or entities which provide necessary debt funding to Seller for the development and construction of Seller’s Facility. 
 “Day” shall mean calendar day unless the context in which the term “day” is used clearly indicates that a Business Day is indicated. The word
day shall have such meaning whether or not the initial letter is capitalized. 
 “Deficit Payment” shall have the meaning given in
Section 9.6. 
 “Early Supply” shall mean those volumes designated as “Early Supply Volumes” on Exhibit 2. 
 “Early Supply Milestone” shall mean the Milestone designated as “Delivery of Carbon to Buyer from any Source” in Exhibit 4. 
 “Effective Date” shall have the meaning given in Section 2.1. 
 “EPA” shall have the meaning given in Section 5.2. 
 “Event of Default” shall have the meaning given in
Section 15.1. 
 “Extension Period” shall have the meaning given in Section 2.4. 
 “Final Analysis” shall have the meaning given in Section 12.2. 
 “Final LC Expiration Date” shall have the meaning given in Section 25.2. 
 “Financial
Close” shall mean when each of the conditions precedent to closing listed in the Credit Agreement have been satisfied or waived in accordance with the terms thereof and the initial funding thereunder has occurred. 
 “Financial Close Milestone” shall mean the Milestone designated as “Financial Close” in Exhibit 4. 
  

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 “Financing” shall have the meaning given in Section 17.5. 
 “Financing Participant” shall have the meaning given in Section 17.5. 
 “First Year” shall have the meaning given in Section 4.2. 
 “Force Majeure” shall
have the meaning given in Section 14.1. 
 “Force Majeure Period” shall have the meaning given in Section 14.2. 
 “Governmental Authority” shall mean any nation or government (including, without limitation, the government of the United States), any state, county,
municipal or other political subdivision thereof and any Person lawfully exercising legislative, judicial, regulatory or administrative functions of or pertaining to the government. 
 “Legal Holiday” shall mean Saturday, Sunday or any Day on which banking institutions in New York, New York are authorized by law, regulation or executive order to remain closed. 
 “Milestone” shall mean the events identified as “Milestones” in Exhibit 4. 
 “Notice” shall mean a notice given in accordance with and complying with the requirements of Section 19. 
 “Party” shall mean either Buyer or Seller and “Parties” shall mean both Buyer and Seller. 
 “Person”
shall mean any individual, limited liability company, partnership, corporation, association, business trust, or other entity or Governmental Authority. 
 “Point of Delivery” shall mean Buyer’s Facility. 
 “Poundage Variations” shall have the meaning given in
Section 4.3. 
 “Purchase Deficit” shall have the meaning given in Section 9.6. 
 “Purchased Carbon” shall have the meaning given in Section 9.6. 
 “Reduction Notice” shall have the meaning given in Section 4.1. 
 “Referee Analysis”
shall have the meaning given in Section 12.5.3. 
 “Seller” shall have the meaning set forth in the Preamble to this Agreement and
includes Seller’s successors and permitted assigns under this Agreement. 
 “Seller Analysis” shall have the meaning given in
Section 12.2. 
  

 4 

 “Seller Group” shall mean Seller, its officers, directors, employees, and agents, and each of its
Affiliates and each of their respective officers, directors, employees and agents. 
 “Seller’s Facility” shall mean the first
production line at Seller’s carbon production facility located in Coushatta, Louisiana. 
 “Seller’s Letter of Credit” shall have
the meaning given in Section 25.2. 
 “Seller’s Letter of Credit Amount” shall have the meaning given in Section 25.2.

 “Specifications” shall have the meaning given in Section 5.1. 
 “Starting Delivery Date” shall have the meaning given in Section 2.2. 
 “Term” shall
have the meaning given in Section 2.3. 
 “Threshold Event” shall mean that point in time when Seller has entered into contracts for
the sale of carbon from Seller’s Facility, each contract with a term greater than one year, and which, in the aggregate, are for volumes equal to or in excess of 400 million pounds of carbon during the Term of this Agreement. 

“Threshold Notice” shall have the meaning given in Section 4.1. 
 “Threshold Overage” shall have the meaning given in Section 4.1. 
 SECTION 2. CONTRACT TERM 

 2.1 Effective Date. The “Effective Date” shall be the date of this Agreement as first set forth in this Agreement.

 2.2 Starting Delivery Date. At least sixty (60) days before the date on which Carbon deliveries will commence under this Agreement (the
“Starting Delivery Date”), which date shall be a Business Day, Buyer shall provide Notice to Seller of such Starting Delivery Date. The Starting Delivery Date shall be no earlier than February 15, 2009 and deliveries for
the calendar year 2009 shall not exceed * in the aggregate. In any event, the Starting Delivery Date shall not be later than April 30, 2009. 
 2.3
Term. The “Term” of this Agreement shall begin on the Effective Date and shall continue thereafter to and including December 31, 2014. Notwithstanding the foregoing, Buyer shall have the right, but not the
obligation, to terminate this Agreement on or after the date on which Buyer has purchased the entire Carbon Purchase Commitment. In such event, Buyer shall have no further liability to Seller hereunder. 
 2.4 Term Extensions. The initial Term shall be extended for one successive three year period (the “Extension Period”) if the Parties, in
each Party’s sole discretion, mutually agree on Carbon pricing and/or price escalation methodology for the Extension Period, on or before sixty (60) days prior to the end of the initial Term. 
  

 5 

 SECTION 3. OUTLINE OF THE OBLIGATIONS OF THE PARTIES 
 3.1 Purpose. The purpose of this Section 3 is to state in brief form a summary of the obligations of the Parties under this Agreement. Notwithstanding this Section 3, Buyer and Seller expressly intend
that all the promises, covenants and other obligations contained in any portion of this Agreement shall be performed as fully and faithfully as the obligations stated in this Section 3. 
 3.2 Obligations of Seller or Seller’s Affiliate(s). Subject to the terms and conditions of this Agreement, Seller or Seller’s Affiliate(s) shall perform
the following obligations: 
 3.2.1 Achieve the Milestones by the applicable dates set forth in Exhibit 4. 
 3.2.2 Sell Carbon to Buyer pursuant to the pricing methodology set forth in Section 9 from either Seller’s Facility or an Alternate
Source of the quality specified in Exhibit 1 and in the quantities specified in Exhibit 2 in accordance with the schedules established pursuant to this Agreement as those quantities may be adjusted as set forth herein. 
 3.2.3 Cause such Carbon to be delivered to Buyer at Buyer’s Facility in accordance with Section 8. 
 3.2.4 Issue monthly invoices for Carbon as specified by this Agreement. 
 3.2.5 Maintain adequate books and records with respect to its obligations and performance under this Agreement. 
 3.2.6 Seller may perform its obligations hereunder directly or cause such obligations to be performed by any of its Affiliates, contractors or
other designees; provided that Seller shall at all times remain responsible to Buyer for the full and timely performance of its obligations hereunder. 
 3.3 Obligations of Buyer. Subject to the terms and conditions of this Agreement, Buyer shall perform the following obligations: 
 3.3.1 Except to the extent Seller does not deliver Carbon due to Seller’s breach or a Force Majeure event preventing Seller’s performance, purchase the Carbon Purchase Commitment as described in Section 4 and as set
forth in Exhibit 2 and accept delivery of, or pay for if not accepted, such Carbon in accordance with the schedules established pursuant to this Agreement. 
 3.3.2 Pay the applicable Contract Price for Carbon delivered and accepted in accordance with this Agreement and any other amounts owed by it hereunder as and when due in accordance with this Agreement.

 SECTION 4. CARBON QUANTITIES AND DELIVERY SCHEDULES 
 4.1 Quantity Obligations. Buyer shall take from Seller and pay for, or pay for, if not taken, the minimum quantities specified in Exhibit 2, as such minimum quantities may be amended as herein set forth (the “Carbon
Purchase Commitment”), except to the extent Seller does not deliver Carbon due to Seller’s breach or a Force Majeure event preventing Seller’s performance. In such event, 

  

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Buyer’s Carbon Purchase Commitment shall be reduced on a pound for pound basis to account for such event; provided, however, that if such event
leads to termination of this Agreement in accordance with its terms, the Carbon Purchase Commitment will terminate upon such termination. Subject to the Carbon Purchase Commitment and terms and conditions of this Agreement, during each Contract
Year, Seller shall tender and sell to Buyer at the Point of Delivery, and Buyer shall purchase from Seller, the total quantity of Carbon specified in Buyer’s Annual Nomination pursuant to Section 4.2, as such Annual Nomination may be
revised from time to time in accordance with Section 4.3 and other applicable provisions of this Agreement; provided, further, that Buyer’s Annual Nomination shall at all times be consistent with achieving Buyer’s full Carbon
Purchase Commitment during the term of this Agreement, except to the extent that Buyer is not obligated to purchase such full Carbon Purchase Commitment as set forth above. Further, to the extent Seller does not use commercially reasonable efforts
to sell Carbon that Buyer fails to accept as contemplated by the definition of “Cover Standard for Seller”, Buyer’s Carbon Purchase Commitment shall be reduced by the amount of Carbon Seller would have been able to sell had it used
such commercially reasonable efforts as contemplated by such definition. 
 Buyer shall have the one time right to increase the Carbon
Purchase Commitment that is set forth on Exhibit 2 by notifying Seller in writing on or before January 1, 2009 of its election to increase such commitment by any amount up to, but not in excess of, the annual amounts set forth on Exhibit 2A. If
Buyer does not so elect on or before January 1, 2009 to increase such commitment, the Carbon Purchase Commitment shall remain as set forth on Exhibit 2. However, if Buyer elects to increase its commitment as provided in this paragraph, the
Carbon Purchase Commitment set forth on Exhibit 2 shall be revised in accordance with Buyer’s election and the new Carbon Purchase Commitment shall be as so revised. 
 Notwithstanding the foregoing, if the Threshold Event occurs, Seller shall, within thirty (30) Days after such event, notify Buyer in writing that the Threshold Event has occurred (the “Threshold
Notice”) and specifying the amount by which the sales volume has exceeded * (the “Threshold Overage”). Within sixty (60) Days after Buyer’s receipt of the Threshold Notice, Buyer shall have the option
during such period, but not the obligation, to notify Seller in writing that it has elected to reduce its Carbon Purchase Commitment (the “Reduction Notice”). Such option must be exercised during such notice period and such
option may only be exercised once. The Reduction Notice shall include the amount by which Buyer elects to reduce its Carbon Purchase Commitment; provided, however, that such reduction shall not exceed in the aggregate *; provided, further,
however, that if Buyer advises that it wishes to reduce its Carbon Purchase Commitment in an amount up to the * and such requested amount exceeds the Threshold Overage, the Carbon Purchase Commitment shall only be reduced in the amount of the
Threshold Overage unless and until *. In the case where the Threshold Overage is insufficient to allow reduction of the Carbon Purchase Commitment in the full amount requested by Buyer in the Reduction Notice, Buyer’s Carbon Purchase Commitment
shall be subsequently reduced if *. The Carbon Purchase Commitment shall be reduced as set forth above, and the amount as reduced shall become the new Carbon Purchase Commitment for all sales beginning on the first of the month following
Seller’s receipt of the Reduction Notice. The Annual Minimum set forth in Section 4.2 shall also be reduced proportionately. Prior to the occurrence of the Threshold Event, Seller shall notify Buyer within thirty (30) Days after each
contract for the sale of carbon which contributes to achieving the Threshold Event. 
  

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 4.2 Nominations. At least sixty (60) Days prior to the Starting Delivery Date, the Parties shall mutually
agree on a start-up schedule and the amount of Carbon to be delivered on a monthly basis through the remainder of the Contract Year in which deliveries start (the “First Year”). On or before November 1 of each succeeding
Contract Year, Buyer shall nominate the pounds of Carbon to be delivered in the following Contract Year, broken down into monthly amounts. Each such Annual Nomination shall be no less than *% of the pounds set forth on Exhibit 2 for such Contract
Year (the “Annual Minimum”) and no greater than *% of the pounds set forth on Exhibit 2 for such Contract Year (the “Annual Maximum”). The Annual Minimum and the Annual Maximum shall be reduced and
prorated on a monthly basis for Contract Years that are less than twelve months. Buyer may revise the Annual Nomination within the foregoing limits, and in accordance with the notification requirements for Poundage Variations specified in
Section 4.3. The term “Annual Nomination” as used in this Agreement shall reflect the actual nomination amount in effect from time to time. Notwithstanding the foregoing, if upon the execution of this Agreement or upon
the exercise of Buyer’s right to increase the Carbon Purchase Commitment as provided in Section 4.1, the Carbon Purchase Commitment is *. 
 4.3
Poundage Variations. Buyer may, at its sole discretion and for any reason, increase or decrease any monthly quantity to reflect its revised expectation of its Carbon needs upon at least thirty (30) Days prior Notice to Seller
(“Poundage Variations”); provided that such an increase or decrease shall not cause the Annual Nomination to be greater than the Annual Maximum or less than the Annual Minimum; and provided, further that on a *
basis Buyer will accept no less than fifteen *% of its Annual Nomination. The Parties acknowledge that Buyer shall have the right to reduce the monthly quantity to as low as zero if necessary to accommodate a Force Majeure event. 
 4.4 Additional Pounds. In the event that Buyer desires and/or needs to purchase Carbon in excess of the Annual Maximum for any Contract Year, Seller shall, in
good faith, determine whether such additional pounds (the “Additional Pounds”) can be supplied by Seller. If the Additional Pounds are not available for supply to Buyer, then Seller shall promptly (and, in any event, within
ten (10) Days) provide Notice thereof to Buyer. 
 SECTION 5. PRODUCT WARRANTY AND PERFORMANCE GUARANTY 
 5.1 Warranty. Seller warrants and represents that the Carbon delivered to Buyer shall be free of any liens or encumbrances. Seller further warrants that all Carbon
sold and delivered to Buyer under this Agreement shall conform strictly to the “Product Specifications” set forth in Exhibit 1 (“Specification(s)”) and have the “Typical Properties” set forth in Exhibit 1
pursuant to industry standards. Carbon shall be tested in accordance with the testing protocols set forth in Exhibits 1A and 1B. As set forth in such protocols, it is the Parties’ intent to test Carbon for acceptance prior to shipment to avoid
unnecessary transportation of substandard Carbon and avoid possible intermingling of substandard Carbon with acceptable Carbon. Buyer shall have the right to request, and Seller shall provide if so requested, a pre-shipment sample of any Carbon
scheduled for delivery. Buyer shall either (i) release such Carbon for delivery, or (ii) reject such Carbon, within twenty-four (24) hours of the time Seller tenders the Carbon shipment for such pre-shipment sample. If Buyer does not
accept or reject such Carbon within such twenty-four (24) hour period, such Carbon shall be 

  

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deemed accepted. For all deliveries that are made without the requirement for a pre-shipment sample, the certificate of analysis required under
Section 12.5.1 will be deemed to represent the actual product quality. The Parties acknowledge that there is no practical way to remove the Carbon from Buyer’s silo so any Carbon delivered to the silo must be used by Buyer. Buyer shall
have the right to test any lots within the thirty (30) Day sample retention period specified in Section 12.5.2 and if Buyer’s analysis is outside of the Specifications, the procedures outlined in 12.5.3 will be used to determine the
final product quality. If the Referee Analysis contemplated by Section 12.5.3 shows that the Carbon does not meet the Specifications and the result to Buyer is additional Carbon usage, Seller will provide at no cost the additional pounds
required to meet the standard performance curve, provided that Buyer can provide accurate verification of the additional carbon usage. 
 5.2
Performance Benchmark. Given the limited or non-existent activated carbon injection performance data available for individual units of Seller’s Facility, a period of three months as mutually selected by the Parties will be set aside to
establish benchmark performance curves for each unit. The Parties acknowledge that the goal during these test periods is to establish a performance curve for controlling total vapor-phase mercury emissions by conducting short-term parametric tests
at different injection rates. The test results will then be used to determine the carbon quantities needed to meet the chosen mercury removal rates. Performance data will be measured using U.S. Environmental Protection Agency
(“EPA”) certifiable mercury continuous emissions monitoring systems that meet certification requirements outlined in EPA’s now vacated Clean Air Mercury Rule at pre-activated carbon injection and post particulate
collection device extraction locations. Mercury measurement and reporting for the tests described in this Section 5.2 will be monitored by Seller but paid for by Buyer. 
 5.3 REMEDY; DISCLAIMER OF IMPLIED WARRANTIES. THE WARRANTY AND REMEDY FOR SUCH WARRANTY AS SET FORTH IN SECTION 5.1 ABOVE IS IN LIEU OF ALL OTHER WARRANTIES AND REMEDIES, REPRESENTATIONS OR CONDITIONS OF ANY
KIND OR NATURE, EXPRESS OR IMPLIED, IN FACT OR IN LAW, WITH RESPECT TO THE CARBON SUPPLIED HEREUNDER, INCLUDING, WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, ANY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. 
 SECTION 6. SOURCE OF CARBON 
 6.1 Source of Carbon. Commencing
on the date identified on Exhibit 4 as the date for “Delivery of Carbon to Buyer from Seller’s Facility”, the Carbon delivered pursuant to this Agreement shall be manufactured by Seller at Seller’s Facility; provided,
however, that Seller shall be permitted to provide Carbon from any alternate sources developed by Seller in accordance with the terms of this Agreement (the “Alternate Sources”) for periods when: 
 a. Seller’s Facility is under construction, or 
 b. events of Force Majeure or other events cause a temporary outage or temporary significant production reduction at the Seller’s
Facility, or 
  

 9 

 c. short term business conditions otherwise necessitate supply from Alternate Sources to
meet Seller’s contractual schedule and quantity commitments in the reasonable judgment of Seller. 
 During its development of Alternate
Sources, Seller shall provide Buyer with regular updates on Seller’s development efforts with Alternate Sources and Seller shall further provide Alternate Sources information and site access reasonably requested by Buyer for the purpose of
Buyer confirming the Alternate Sources’ viability to provide carbon in accordance with the Specifications and in quantities represented by Seller. When and if Alternate Sources are to be used, Seller shall provide written notice to Buyer.
Seller shall be obligated to make all commercially reasonable efforts to minimize the period(s) when Alternate Sources are used. Seller will provide Carbon from Alternate Sources for Early Supply commencing on or before the date set forth for the
Early Supply Milestone in Exhibit 4. If Seller elects to deliver Carbon from Alternate Sources, Seller shall pay directly or reimburse Buyer for all reasonable transportation costs incurred to transport such Carbon to Buyer’s Facility to the
extent such costs exceed the costs Buyer would have incurred if such Carbon had been transported from Seller’s Facility. 
 SECTION 7. DELIVERY OF
CARBON 
 7.1 Delivery Terms. Seller shall deliver the Carbon to Buyer’s Facility FOB Destination Prepaid and Added. Buyer is responsible for
costs of insurance and freight in addition to the Base Price, with Seller to be the loss payee for such insurance. Seller shall arrange for loading of Carbon at Seller’s Facility. 
 7.2 Title and Risk of Loss. Title and risk of loss and damage to Carbon shall pass to Buyer at the Point of Delivery. Seller warrants that it will pass to Buyer full title to such Carbon free and clear of all
liens and encumbrances. Seller assumes no liability for the Carbon after title and risk of loss pass to Buyer, except as otherwise specifically provided in this Agreement. Title and risk of loss and damage to Carbon Buyer rightfully rejects in
accordance with Section 5 shall remain with Seller. 
 SECTION 8. TRANSPORTATION OBLIGATIONS 
 8.1 Transport. Seller shall arrange for the transport of Carbon supplied by Seller hereunder to the Point of Delivery. Transportation arranged by Seller shall be
of sufficient capacity to accommodate the transport of the Annual Nominations made (and adjusted) pursuant to Section 4 of this Agreement. Buyer shall pay all of the documented costs (including insurance and freight) for such shipment to the
Point of Delivery in accordance with the cost methodology set forth in Exhibit 5, which costs shall be directly billed to Buyer by the shipping companies to the extent possible. Seller shall at all times comply with Buyer’s reasonable requests
regarding selection and management of shipping and shall provide Buyer access to all of Seller’s documents and records regarding shipment costs and expenses. Seller’s delivery agent shall be responsible for the unloading of Carbon at
Buyer’s Facility. Seller shall use or cause to be used transport equipment that is in good condition, clean, and ready to load. 
  

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 If at any time during the term of this Agreement Buyer elects to arrange for the transportation of Carbon from
Seller’s Facility to the Point of Delivery, Buyer shall provide Seller with not less than thirty (30) Days written notice prior to the date on which Buyer elects to assume responsibility for transportation. Notwithstanding the foregoing,
if at any time Buyer fails to provide transportation in accordance with the delivery schedule set forth herein and such failure adversely impacts Seller’s operations, then Seller shall have the right to arrange for transportation as set forth
in the preceding paragraph and Buyer shall pay all such documented costs. 
 SECTION 9. PRICE OF CARBON 
 9.1 Contract Price. The “Contract Price” for any calendar month after the Starting Delivery Date is an amount equal to (without
duplication) (i) the Base Price (determined as provided in Section 9.2), multiplied by (ii) the number of pounds of Carbon delivered during such month. 
 9.2 Calculation of Base Price. 
 9.2.1 Base Price. The “Base Price” for Carbon
delivered by Seller to Buyer at the Point of Delivery in accordance with this Agreement shall be that price per pound set forth on Exhibit 3. The Base Price does not include the cost of freight and insurance, which is Buyer’s responsibility
pursuant to Sections 7.1 and 8.1. The Base Price set forth in Exhibit 3 shall be subject to escalation in accordance with Section 9.2.2 and billings shall be reconciled annually in accordance with Section 9.4. 
 9.2.2 * Adjustment. Commencing on January 1, 2011, the Base Price in Exhibit 3 shall be adjusted, and adjusted annually thereafter, as of the first day of
each calendar year by increasing the Base Price by a percentage equal to each positive percentage point of change, or proportionately for fractional parts of a positive percentage point of change, *. The * used to determine the percentage change to
be effective on January 1, 2011 shall be the * published for January 2010. For example, the Base Price in effect for deliveries in 2010 shall be adjusted for deliveries beginning on January 1, 2011 by a percentage equal to each positive
percentage point of change, or proportionately for fractional parts of a percentage point of change, to reflect the positive cumulative changes in the * between January 1, 2010 and January 1, 2011. The Base Price, as adjusted, shall be the
new Base Price for the period January 1, 2011 to December 31, 2011. Similarly, effective January 1, 2012, the new Base Price shall be adjusted again for each positive percentage point of change, or proportionately for fractional parts
of a percentage point of change, to reflect cumulative positive changes in the * between January 1, 2011 and January 1, 2012. The Base Price shall continue to be adjusted annually on January 1 of each year for the remainder of the
Term of this Agreement. Notwithstanding the foregoing, the percentage of annual positive adjustment in the Base Price shall not exceed * percent (*%) in any year during the term of this Agreement. 
 Exhibit 3 to this Agreement contains an example of the calculations pursuant to this Section 9.2.2. 
 9.2.3 Notice of Calculations. Seller shall calculate the * adjustment to the Base Price pursuant to Section 9.2.2 for each Contract Year and provide Notice to Buyer of the new Base Price to be applicable
for such Contract Year prior to January 30 of such year. Seller’s Notice shall provide sufficient detail regarding how such calculations were made. 
  

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 9.3 Taxes, Fees and Royalties. All taxes, fees and royalties are included in the Base Price other than any
applicable state sales tax, which shall be to Buyer’s account. In the event that subsequent to the execution of this Agreement, a Governmental Authority makes a change in tax law that materially impacts the cost of producing and supplying
Carbon, such as, without limitation, issuance of a new carbon tax, Seller shall so advise Buyer and provide substantiation of the cost impact as reasonably requested by Buyer. Seller and Buyer shall thereafter negotiate in good faith an equitable
adjustment in the Base Price to account for such cost impact. 
 9.4 Annual Reconciliation of Carbon Purchase Quantity. Within thirty (30) Days
after the end of each Contract Year, Seller shall total all deliveries of Carbon to Buyer and determine the annual quantity of Carbon actually delivered (the “Annual Delivered Amount”). If the Annual Delivered Amount is less
than the Annual Minimum, as such amount may be adjusted in accordance with this Agreement, then Buyer shall pay to Seller the amount calculated by taking the difference between the Annual Minimum and the Annual Delivered Amount (the
“Annual Shortfall”) and multiplying such amount by the Base Price(s) in effect for the Contract Year. If the first Contract Year after commencement of deliveries is not a full calendar year, the determination of the Annual
Minimum shall be appropriately prorated to reflect the actual period of deliveries (e.g., if deliveries commence on July 1, then the Annual Minimum would be one-half the Annual Minimum specified in 4.2). 
 9.5 Rounding. Unless otherwise specifically provided by this Agreement, the values used to perform the calculations prescribed by this Agreement shall be rounded
to three (3) decimal places. For invoicing purposes, the dollar amounts of charges and credits shall be rounded to the nearest cent. For purposes of adjusting values in accordance with this Section 9, the Adjustment Index shall be rounded
to the nearest hundredth of an index point. The annual percentage changes for the Adjustment Index shall be rounded to the nearest hundredth of a percentage point. The Base Price adjusted pursuant to Section 9 shall be rounded to two
(2) decimal places. 
 9.6 End of Term Reconciliation of Carbon Purchased Versus Carbon Purchase Commitment. Within thirty (30) Days after
the end of the Term of this Agreement, Seller shall determine the actual quantity of carbon delivered to Buyer (the “Actual Carbon Purchase”) plus the quantity, if any, of Annual Shortfalls paid for by Buyer pursuant to 9.4
above for failure to meet Annual Minimums (collectively the Actual Carbon Purchase plus the quantity of all paid for Annual Shortfalls total the “Purchased Carbon”) and shall reconcile the Purchased Carbon against the
quantity of the Carbon Purchase Commitment as such commitment may be adjusted as herein provided. Seller shall provide such determination to Buyer in writing within thirty (30) Days after the end of the Term. If the Purchased Carbon quantity is
less than the Carbon Purchase Commitment (a “Purchase Deficit”), Buyer shall pay to Seller an amount equal to the Base Price times the Purchase Deficit ( the “Deficit Payment”). Such payment shall be
Seller’s sole and exclusive remedy for Buyer’s failure to meet its Carbon Purchase Commitment, and Seller’s consequent loss of revenues. In the event that the Purchased Carbon exceeds the Carbon Purchase Commitment, the Parties shall
have no further obligations to each other hereunder. To the extent that Seller has production capacity available at the end of the Term of this Agreement and Buyer has a 

  

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Purchase Deficit and/or has paid for Carbon that it has not taken, Buyer shall have the right, but not the obligation, to extend this Agreement by a period
of twelve (12) months in order to take delivery of the amount of the Purchase Deficit and any Carbon paid for, but not taken; provided that Buyer provides Notice of such extension to Seller and makes the Deficit Payment within thirty
(30) Days after the date when Seller notifies Buyer of the Purchase Deficit. 
 9.7 *. *, if Seller has executed or hereafter executes a carbon
supply agreement for the sale of carbon from Seller’s Facility with a third party that is substantially equivalent in contract term and volumes to this Agreement and has a lower price per pound for carbon than as set forth in this Agreement
(each, a “Third Party Agreement”), Buyer may elect to accept the price contained in the Third Party Agreement; provided, however, that in the event Buyer elects to accept the price contained in the Third Party
Agreement, Sections 4, 9, 15 and 25 of this Agreement shall also be revised to be substantially equivalent to terms of the Third Party Agreement. * . 
 SECTION 10. INVOICING AND PAYMENT 
 10.1 Invoicing Procedures. Seller shall invoice Buyer monthly for deliveries under this Agreement.
On or before the tenth (10th) Day of each month of a Contract Year, Seller shall send Buyer an invoice for all Carbon delivered to and accepted by Buyer during the preceding month priced in accordance with Article 9 and the Final Analysis as
provided in Section 12 . 
 10.2 Payment Procedures. Buyer shall pay undisputed invoices by wire transfer within thirty (30) Days after the
receipt of each monthly invoice. If Seller does not receive timely payment of undisputed amounts, then interest shall be charged at the prime rate in effect on that date (as set by the Chase Manhattan Bank of New York on ninety (90) Day
commercial loans as of the date payment is due) plus one and one-half percent (1.5%), but in no event in excess of the highest rate allowed by Applicable Law. 
 10.3 Disputed Invoices. Buyer shall pay all invoices issued by Seller in accordance with this Section 10, except those portions of any invoice that Buyer formally disputes in a Notice to Seller, which Notice Buyer shall submit
to Seller within fifteen (15) Days after receiving the invoice. Buyer shall pay all undisputed portions of each disputed invoice. The Parties shall make every reasonable effort to settle invoice disputes promptly through good faith
negotiations. Payment of disputed amounts shall be made within ten (10) Days following the date of settlement. Thereafter, such amounts shall accrue interest at the late payment rate established pursuant to Section 10.2. Notwithstanding
the foregoing, Buyer’s reasonable dispute of an invoice shall not constitute an Event of Default, nor constitute cause for Seller to delay or suspend performance under this Agreement. 
 SECTION 11. COMPLIANCE WITH LAWS 
 11.1 Construction. In
performing this Agreement Buyer and Seller shall not knowingly violate any Applicable Laws; provided, however, that no such violation shall constitute an Event of Default by a Party unless it results in a material non-performance of the
Party’s other performance obligations under this Agreement. Buyer and Seller shall interpret and construe this Agreement to achieve lawful results. 
  

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 11.2 Severability. If any portion of this Agreement becomes or is determined by a Governmental Authority with
jurisdiction to be illegal, Buyer and Seller shall modify that portion to correct the illegality. The illegality of any portion of this Agreement shall not affect the validity or the enforceability of the remainder of this Agreement. 
 SECTION 12. WEIGHING, SAMPLING, AND ANALYSIS 
 12.1 Procedures.
Weighing, sampling, and analysis of the Carbon tendered for delivery shall be carried out in accordance with the provisions of this Section 12. 
 12.2 Duties to Sample Carbon. Seller shall collect samples at Seller’s Facility in accordance with the testing protocols set forth in Exhibits 1A and 1B. The sampling shall be conducted at Seller’s Facility and in a
statistically reliable method that is in compliance with procedures approved by the American Society for Testing and Materials (“ASTM”). Seller shall, subject to the protocols set forth in Exhibits 1A and 1B, perform or cause
to be performed an analysis of each lot or batch of Carbon produced by Seller to determine the characteristics of the Carbon (each, a “Seller Analysis”). The methods and procedures to be used in the sampling process and
laboratory analysis shall be in compliance with those approved by the ASTM, or such other methods and procedures mutually agreed to in writing by the Parties. Unless Buyer requests a Referee Analysis pursuant to Section 12.5.3, the results of
each Seller Analysis shall be deemed the final analysis and be binding as the analysis for determining whether the carbon meets the Specifications (the “Final Analysis”). If Buyer requests a Referee Analysis pursuant to
Section 12.5.3, the results of such Referee Analysis shall be the Final Analysis. The foregoing notwithstanding, Buyer shall have the right at any time to conduct sampling and analysis of Carbon delivered to Buyer and if such testing reveals a
discrepancy with the results obtained by Seller, the Parties shall confer and resolve any issues as set forth in Section 12.5.3. 
 12.3 Duties of
Seller to Weigh Carbon. 
 12.3.1 Duty to Weigh; Use of Weighing Data. Seller shall weigh or cause to be weighed all Carbon at Seller’s
Facility by using truck scales to obtain the inbound unloaded weight of such trucks delivering Carbon and then using the same truck scales to obtain the outbound unloaded weight of such trucks delivering Carbon. A representative of Buyer may be
present at each weighing. The weight of Carbon thus determined shall be accepted as the pounds of Carbon to be used in determining the quantity of Carbon for which invoices are to be rendered and payments made in accordance with Section 10.

 12.3.2 Inspection and Certification of Scales. Seller will have an independent scale inspector inspect, test, calibrate and certify the facility
truck scales annually at its cost. A representative of Buyer may be present at the annual inspection, test and calibration. Buyer has the right at its cost to have an independent testing agency test the accuracy of Seller’s scales at reasonable
intervals more frequently than annually, but not to exceed monthly unless the scales are found repeatedly to be out of calibration, in which case the scales may be tested as repeatedly requested by Buyer. 
 12.3.3 Seller’s Certification of Scales and Weights; Correction of Errors. Seller shall certify the scale readings and the weights indicated thereon shall be
used for all pounds of Carbon under this Agreement. If as a result of any inspection by an independent scale 

  

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inspector as provided for in Section 12.3.2, the scales are found to be in error in excess of normal scale tolerance, which is understood to
be +/-0.5%, the scales shall be corrected and the pounds of Carbon for the period since the last scale inspection shall be adjusted either up or down, as the case may be, for 50% of any correction made to the scales and an appropriate credit or
debit line item shall be included in the next regularly scheduled invoice. 
 12.4 Failure of Weighing, Sampling or Analytical Procedures. 

12.4.1 Substitute Procedures. In the event Seller is unable for any reason to perform the Analyses or Seller is unable to perform the weighing required by this
Agreement, the Parties shall act in good faith to agree on reasonable substitute procedures to be followed by Buyer. In the event the scales become inoperative, the weight of Carbon delivered during such period shall be determined by giving the
methods of determination controlling effect in the following order: (i) the weight determined by Buyer by scales at Buyer’s Facility if Buyer weighs such shipments; (ii) the weight determined by government scales if such shipments are
weighed during shipment; and (iii) the weight of the average unit deliveries during the preceding sixty (60) Day period multiplied by the number of units delivered but not actually weighed. 
 12.4.2 Inaccurate or Unreliable Sample or Seller Analysis. In the event that the sampling of Carbon by Seller or the Seller Analysis with respect to one or more
truckloads was inaccurate or unreliable for any reason, Buyer’s analysis shall be used (subject to Section 12.5), if any, or if such analysis is not available, Seller shall certify the average of the Seller Analyses for the preceding and
succeeding truckloads which are reliable and accurate and use this average in lieu of the data for any unit delivered determined to be unreliable or inaccurate. 
 12.5 Rights of Buyer and Seller in Weighing, Sampling and Analysis. 
 12.5.1 Results of Sampling and Analysis Binding. Subject to
this Section 12, the reports of sampling made by Seller and the Seller Analysis shall be binding on the Parties for all purposes under this Agreement and the performances of the Parties under this Agreement shall be based on such reports and
the Seller Analysis. Seller shall provide a certificate of analysis with respect to the Seller Analysis for each shipment. 
 12.5.2 Independent Analysis
of Samples. Each representative unit sample collected for a Seller Analysis shall be divided into three parts, and two of these parts shall be stored in suitable containers at the testing facility for a period of at least thirty (30) Days.
During such period Buyer may request the sample from any (or all) lot(s) and submit them for internal or independent analysis. Seller shall deliver to Buyer with each monthly invoice one part of such sample for purposes of independently evaluating
the performance or verifying the Seller Analysis. 
 12.5.3 Referee Analysis. If Buyer’s analysis of a sample it has received pursuant to
Section 12.5.2 or a sample it takes at Buyer’s Facility differ from the Seller Analysis that Seller performs pursuant to Section 12.2 by more than the ASTM standard for reproducibility and does not meet the Specifications, Buyer or
Seller shall have the right to have the quality of the lot or batch of Carbon in question determined by an independent laboratory chosen jointly by Buyer and Seller (a “Referee Analysis”). The party 

  

 15 

 
exercising such right shall exercise it, if at all, within thirty (30) Days after it receives the part sample referenced in Section 12.5.2. The
cost of the Referee Analysis shall be borne equally by each Party. Notwithstanding Section 12.5.1 and Section 12.2, such Referee Analysis shall be deemed the Final Analysis. 
 12.5.4 Observation of Sampling and Analysis. Each Party shall have the right to have a representative present at any and all weighing, sampling, and analysis procedures. Buyer or Seller and their
representatives shall also have the right to test, inspect, and examine the performance of any equipment employed in these procedures at all reasonable times. 
 SECTION 13. RECORDS AND AUDITS 
 13.1 Record Review. 
 13.1.1 Records of Seller. Seller shall maintain books, records, documents and other evidence of all matters relating to its performance under this Agreement in accordance with generally accepted accounting
practices. Seller shall submit to Buyer, upon Buyer’s written request, information in sufficient detail to support and document any invoices. Seller shall also allow Buyer access to Seller’s books, records, and documents (i) to the
extent necessary to verify if the Threshold Event has occurred and when such event occurred and (ii) to the extent reasonably necessary to determine that Seller has performed its obligations under this Agreement in accordance with the terms
hereof. 
 13.1.2 Records of Buyer. Buyer shall maintain books and records of all matters relating to its performance under this Agreement in
accordance with generally accepted accounting practices. If Buyer makes a warranty claim against Seller or a claim that the Carbon does not meet the Specifications, Buyer shall submit to Seller, upon Seller’s written request, information
reasonably related to Buyer’s warranty claim or claim that the Carbon does not meet the Specifications. 
 13.1.3 Overpayment or Underpayment.
Should a record review performed by Buyer or Seller reveal an overpayment or underpayment, then the amount of the overpayment or underpayment shall promptly be paid to the Party to whom it is owed by the other Party with interest at the late payment
rate specified by Section 10.2. 
 13.2 Timing of Record Review. Any invoices which are not contested by either Party within two (2) years
from the date of receipt by Buyer shall be deemed to be correct and final and shall not thereafter be subject to record review. 
 SECTION 14. FORCE
MAJEURE 
 14.1 Definition of Force Majeure. “Force Majeure” shall mean an event or condition that prevents or delays the
performance by a Party of its obligations under this Agreement to the extent beyond the reasonable control, and without the fault or negligence, of the Party claiming relief, and which by the reasonable exercise of due diligence such claiming Party
is unable to prevent or overcome. Force Majeure includes, but is not limited to, acts of God, fires, floods, explosions, electrical storms, windstorms, extremes of temperature, earthquakes, enactment of new Applicable Law or changes in Applicable
Law, landslides, cave-ins, war, riot, terrorism, accident, embargoes, acts of the public enemy or sabotage, boycotts, terrorism, wars, and riots. In no event shall an Event of Force Majeure excuse or delay the payment of any amount owed by one Party
to the other Party under this Agreement. 
  

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 14.2 Effect of Force Majeure. If Force Majeure prevents either Party from performing any of its obligations under
this Agreement, and if such Party gives to the other Party Notice of the Force Majeure (which Notice (i) shall identify the event of Force Majeure and, to the extent known, the expected length of time during which the event of Force Majeure
will be in effect and the plan of the Party experiencing the Force Majeure to correct or remove it and (ii) be delivered promptly, but in no event later than ten (10) Days after the start of the Force Majeure event), then the obligations
of the Party giving such Notice are excused to the extent made necessary by the Force Majeure and during its continuance, which time period shall be called the “Force Majeure Period.” However, an event of Force Majeure shall
excuse the obligations of the notifying Party only to the extent that the Party takes all commercially reasonable actions necessary to overcome the Force Majeure with all reasonable dispatch. Only the Party suffering an event of Force Majeure may
claim Force Majeure relief; provided however, that the other Party shall be excused during the Force Majeure Period from its obligations which depend upon the performance of the obligations excused by the Force Majeure. An attempt by the
Party suffering an event of Force Majeure to perform its obligations notwithstanding the Force Majeure shall not constitute a waiver of the right to claim Force Majeure if such attempt proves unsuccessful. The Party affected by Force Majeure shall
not be required to submit to unreasonable conditions or restrictions imposed by any Governmental Authority or acts of others such as strikes, lockouts or other industrial disturbances. In the event, and to the extent, a Force Majeure prevents Buyer
from accepting Carbon, Buyer’s obligation to accept Carbon hereunder shall be postponed during the Force Majeure Period but Buyer shall remain liable for the full amount of the Carbon Purchase Commitment hereunder; provided that the Term
in which to complete the Carbon Purchase Commitment shall be extended for a duration equal to the duration of the Force Majeure Period. 
 SECTION 15.
EVENTS OF DEFAULT; REMEDIES 
 15.1 Event of Default. An event of default (an “Event of Default”) under this Agreement
shall be deemed to exist upon the occurrence of any one or more of the following events: 
 15.1.1 Payment Default. Failure by either Party to pay or
cause to be paid any undisputed amount that is due and payable under this Agreement and such failure continues for a period of ten (10) Days after Notice of such nonpayment is delivered to the defaulting Party. 
 15.1.2 Failure to Meet Milestone Schedules. 
 15.1.2.1 Failure by Seller to achieve the Financial Close Milestone on or before the applicable date set forth in Exhibit 4. 
 15.1.2.2 Failure by Seller to achieve the Early Supply Milestone on or before the applicable date set forth in Exhibit 4. 
  

 17 

 15.1.2.3 Failure by Seller to achieve any Milestone set forth in Exhibit 4
on or before the applicable date set forth in Exhibit 4, other than the Financial Close Milestone and the Early Supply Milestone. 
 15.1.3 Failure to
Perform Material Provisions. Failure by either Party to perform fully any material provision of this Agreement other than as described in Sections 15.1.1, 15.1.2 and 15.1.4 and (a) such failure continues for a period of thirty
(30) Days after Notice of such non-performance is delivered to the non-performing Party or (b) if such failure is not reasonably susceptible to cure within such thirty (30) Day period and the non-performing Party shall commence within
such thirty (30) Day period and shall thereafter continuously proceed with all due diligence to cure such failure, such failure is not cured within such longer period (not to exceed ninety (90) Days) as shall be necessary for such
Party to cure the same with all due diligence. 
 15.1.4 Continued Failure to Supply. Notwithstanding the provisions of Section 15.2.1, it shall
be an Event of Default if Seller fails to deliver Carbon at the rate reflected by the Annual Minimum and either (a) Buyer is required to rely on the cover remedy set forth in Section 15.2.1.1 for a cumulative nine-month period during the
term of this Agreement or (b) the security posted by Seller pursuant to Section 25.2 is exhausted. 
 15.2 Remedies for Default and Event(s) of
Default. 
 15.2.0 Early Termination. In the event this Agreement is terminated due to an Event of Default of Seller occurring on
or prior to January 30, 2009, then Buyer’s damages shall be limited to the applicable amounts set forth in Exhibit 9. 
 15.2.1
Cover. 
 15.2.1.1 Buyer’s Cover Remedy. After January 30, 2009, in the event of a breach of the obligation by Seller to deliver Carbon
for any month, and except for Buyer’s right to terminate pursuant to *, Buyer’s sole and exclusive remedy for Seller’s failure to deliver Carbon shall be recovery of the following: (i) payment by Seller to Buyer of an amount
equal to the positive difference, if any, between the purchase price paid by Buyer utilizing the Cover Standard for Buyer and the Base Price, as adjusted in accordance with Section 9.2.2 and as further adjusted for * multiplied by the lesser of
(x) the amount of Carbon that Seller failed to deliver and (y) the amount of Carbon actually purchased by Buyer utilizing the Cover Standard for Buyer; or (ii) in the event that Buyer has utilized the Cover Standard for Buyer to
replace the Carbon, and no such replacement is available, or, if available, is not available in sufficient quantities to replace all of the Carbon that Seller failed to deliver, then, in addition to the amount payable pursuant to subparagraph (i),
if any, Seller shall pay to Buyer $* per pound of Carbon multiplied by the amount of Carbon that Seller failed to deliver and which Buyer was unable to buy utilizing the Cover Standard for Buyer. 
 The amounts described in clauses (i) and (ii) above shall be payable within * after presentation of Buyer’s invoice, which shall set forth the basis upon
which such amount was calculated. Notwithstanding the foregoing, the maximum liability of Seller under this Section 15.2.1.1 shall not exceed the limitation of liability set forth in Section 15.7. 
  

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 15.2.1.2 Seller’s Cover Remedy. After January 1, 2009, in the event of a breach of the
obligation by Buyer to take delivery of Carbon for any month, and except for Seller’s right to terminate as provided herein and Seller’s rights set forth in *, Seller’s sole and exclusive remedy for Buyer’s failure to accept
delivery of Carbon shall be recovery of the following: (i) payment by Buyer to Seller of an amount equal to the positive difference, if any, between the sales price received by Seller utilizing the Cover Standard for Seller and the Base Price,
as adjusted in accordance with Section 9.2.2 and as further adjusted for * multiplied by the amount of Carbon actually sold by Seller utilized the Cover Standard for Seller; or (ii) in the event that Seller has utilized the Cover Standard
for Seller to sell the Carbon, and no such sale is available, or if available, was not available in sufficient quantities to replace all of the Carbon that Buyer failed to accept, then in addition to the amount payable pursuant to subparagraph (i),
if any, Buyer shall pay to Seller the Base Price per pound of Carbon multiplied by the amount of Carbon that Buyer failed to accept and which Seller was unable to sell utilizing the Cover Standard for Seller. The amounts described in clauses
(i) and (ii) above shall be payable within * after presentation of Seller’s invoice, which shall set forth the basis upon which such amount was calculated. * Notwithstanding the foregoing, the maximum liability of Buyer under this
Section 15.2.1.2 shall not exceed the limitation of liability set forth in Section 15.7. 
 “Cover Standard for Buyer” as
referred to in Section 15.2.1.1, shall mean that if there is an unexcused failure by Seller to deliver any quantity of Carbon pursuant to this Agreement, then Buyer shall use commercially reasonable efforts to obtain carbon at a price
reasonable for the delivery area, as applicable, consistent with the amount of notice provided by Seller, the immediacy of Buyer’s Carbon consumption needs, the quantities involved and the anticipated length of failure by Seller. 
 “Cover Standard for Seller” as referred to in Section 15.2.1.2, shall mean that if there is an unexcused failure by Buyer to accept any
quantity of Carbon pursuant to this Agreement, then Seller shall use commercially reasonable efforts to sell Carbon intended for Buyer’s use at a price reasonable for the delivery area, as applicable, consistent with the amount of notice
provided by Buyer, the quantities involved and the anticipated length of failure by Buyer; provided, however, that only quantities of carbon resold by Seller solely for purposes of effecting cover pursuant to Section 15.2.1.2 shall be
included in the amount referenced in Section 15.2.1.2 and any quantities of carbon otherwise sold, or to be sold, by Seller to third parties notwithstanding Seller’s attempt to cover shall not be included in such amount. 
 15.2.2 Termination Rights. Upon the occurrence and during the continuation of the events specified below, the Parties shall have the respective
right to terminate as specified below: 
 15.2.2.1 upon thirty (30) Days advance Notice by Buyer to Seller, if the Event of
Default is an Event of Default under Section 15.1.2.1 (Financial Close Default), unless the Event of Default is cured within such thirty (30) Day period; provided, however, that in the event that Seller reasonably concludes that
Financial Close cannot be achieved by January 30, 2009 despite Seller’s best efforts, Seller shall have the right to terminate this Agreement by advance Notice to Buyer sent no later than December 31, 2008 and in such event Seller
shall pay the agreed liquidated damages set forth in Exhibit 9; 
  

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 15.2.2.2 upon five (5) Days advance Notice following the expiration of the applicable cure
period set forth in Exhibit 4 by Buyer to Seller, if the Event of Default is an Event of Default under Section 15.1.2.2 (Early Supply Default), unless the Event of Default is cured within the applicable cure period set forth in Exhibit 4;
provided, however, that (a) such termination shall only be a partial termination for the Early Supply quantities and shall not be a termination for any quantities other than such Early Supply quantities and (b) other than such
termination, Buyer’s sole and exclusive remedy for such Event of Default shall be the cover remedy set forth in Section 15.2.1.1 for such non-supply of the Early Supply quantities; 
 15.2.2.3 upon five (5) Days advance Notice following the expiration of the applicable cure period set forth in Exhibit 4 by Buyer to Seller,
if the Event of Default is an Event of Default under Section 15.1.2.3 (Other Milestone Default), unless the Event of Default is cured within the applicable cure period set forth in Exhibit 4; 
 15.2.2.4 upon ten (10) Days advance Notice by the non-defaulting Party to the defaulting Party, if the Event of Default is an Event of
Default under Section 15.1.1 (Payment Default), unless the Event of Default is cured within such ten (10) Day period; 
 15.2.2.5 upon fifteen (15) Days advance Notice by Buyer to Seller, if the Event of Default is an Event of Default under Section 15.1.4 (Continued Failure to Supply), unless the Event of Default is cured within such fifteen
(15) Day period; 
 15.2.2.6 upon thirty (30) Days advance Notice by either Party to the other when a Force Majeure is not
corrected or removed within one (1) year. 
 15.3 Extension of Cure Periods. Seller shall have the right, but not the obligation, to extend the
cure periods set forth in Sections 15.2.2.2 (Early Supply Default) and 15.2.2.3 (Other Milestone Default) for up to one hundred eighty (180) Days, if, in addition to the Seller’s Letter of Credit in the amount set forth in
Section 25.2, Seller shall increase the amount of such Seller’s Letter of Credit (or in lieu thereof provide an additional letter of credit) to secure Seller performance hereunder for the additional delay to reflect Buyer’s reasonable
anticipated cost of cover caused by such delay. If the actual amount of such anticipated cost of cover cannot be determined to a reasonable certainty, the parties agree that such amount shall be assumed to be $* per Day for each Day of delay for
Early Supply delays and $* per Day for each Day of delays in deliveries scheduled to begin in the first quarter of 2010. 
 15.4 Specific Performance.
Each of the Parties shall have the right to bring actions for specific performance of the obligation of Buyer to take and pay for Carbon and the obligation of Seller to sell and deliver Carbon provided, however, that: (a) Buyer may
require specific performance of Seller’s Carbon delivery obligation only to the extent that Buyer is unable to obtain sufficient quantities of Carbon to cover quantities Seller committed to deliver as set forth in clause (ii) of
Section 15.2.1.1 and Buyer chooses not to accept the specified liquidated damage amount set forth in such clause; and *. 
  

 20 

 15.5 Waiver of Breach. Either Party may waive a breach by the other Party, provided that any such waiver
shall be deemed to extend only to the particular breach waived and shall not limit or otherwise affect any rights that Buyer or Seller may have with respect to any other or future breach. 
 15.6 Seller’s Right to Suspend Deliveries. If at any time during the continuation of an Event of Default under Section 15.1.1 (Payment Default) on the
part of Buyer has occurred and is continuing, then until the date such Event of Default is cured Seller may suspend deliveries of Carbon hereunder upon two (2) Business Days’ prior Notice to Buyer. If such Event of Default continues after
such two (2) Business Day period, Seller’s suspension will become effective. If the suspension continues for more than ten (10) Days, then, notwithstanding the subsequent remedy of such Event of Default, Seller shall not be required
to resume deliveries of Carbon hereunder for a reasonable period of time taking into account alternative supply arrangements and operational considerations that Seller may have undertaken as a result of such Buyer non-performance; provided,
however, that in no event shall Seller take longer than thirty (30) Days following the date such Event of Default is cured to resume deliveries. 
 15.7 Limitation of Liabilities. Except as specifically provided in this Agreement, neither Party shall be liable to the other Party for any punitive, special, incidental or consequential damages based upon breach of any warranty or
of contract, negligence or any other theory of legal liability arising under or out of this Agreement. Except for each Party’s right to terminate as herein provided, or in the alternative, its right to demand specific performance pursuant to
Section 15.4, the Parties acknowledge that (a) the damages incurred by Buyer under this Agreement for Seller’s failure to deliver Carbon hereunder shall be limited to Seller’s cover obligation as set forth in
Section 15.2.1.1 and (b) the damages incurred by Seller under this Agreement for Buyer’s failure to accept delivery of Carbon hereunder shall be limited to Buyer’s cover obligation as set forth in Section 15.2.1.2. In any
event, neither Party’s liability hereunder for any nonperformance or breach of contract shall exceed an amount equal to the Carbon Purchase Commitment multiplied by the Base Price per pound of Carbon; provided, however, that if this
Agreement is terminated for any reason in accordance with the terms hereof prior to the commencement of Carbon deliveries from Seller’s Facility, neither Party’s liability hereunder shall exceed in the aggregate $10,000,000.
Notwithstanding anything to the contrary herein, (a) each Party’s damages in connection with any termination of this Agreement prior to January 30, 2009 shall be limited to the applicable amounts set forth in Exhibit 9, and
(b) in the case of an Event of Default under Section 15.1.2.2 (Early Supply Default), Buyer shall only be permitted to terminate this Agreement with respect to Early Supply quantities and such termination shall not apply to any other
portion of the Carbon Purchase Commitment. 
 15.8 * Seller shall, at Buyer’s expense and request, execute or cause the execution of any mutually
agreeable documentation reasonably requested by Buyer in order to effectuate the foregoing. 
 SECTION 16. CHOICE OF LAW 
 16.1 Choice of Law. THIS AGREEMENT IS GOVERNED BY AND SHALL BE CONSTRUED IN ACCORDANCE WITH LAWS OF THE STATE OF TEXAS WITHOUT GIVING EFFECT TO ANY CHOICE OR
CONFLICT OF LAW PROVISION OR 

  

 21 

 
RULE (WHETHER OF THE STATE OF TEXAS OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF
TEXAS. THE PARTIES MUTUALLY CONSENT TO THE EXCLUSIVE JURISDICTION OF THE FEDERAL AND STATE COURTS IN DALLAS COUNTY, TEXAS AND AGREE THAT ANY ACTION, SUIT OR PROCEEDING CONCERNING, RELATED TO OR ARISING OUT OF THIS AGREEMENT AND THE NEGOTIATION OF
THIS AGREEMENT WILL BE BROUGHT ONLY IN A FEDERAL OR STATE COURT IN DALLAS COUNTY, TEXAS AND THE PARTIES AGREE THAT THEY WILL NOT RAISE ANY DEFENSE OR OBJECTION OR FILE ANY MOTION BASED ON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE, INCONVENIENCE
OF THE FORUM OR THE LIKE IN ANY CASE FILED IN A FEDERAL OR STATE COURT IN DALLAS COUNTY, TEXAS. THE PARTIES MUTUALLY AGREE THAT THIS AGREEMENT IS A “MAJOR TRANSACTION” WITHIN THE MEANING OF THE TEXAS CIVIL PRACTICE AND REMEDIES CODE §
15.020 AND AS SUCH AGREE THAT ANY ACTION OR SUIT ARISING FROM THIS AGREEMENT SHALL BE BROUGHT IN DALLAS COUNTY, TEXAS, AND VENUE SHALL BE IN DALLAS COUNTY, DALLAS, TEXAS. 
 The Parties acknowledge and agree that all implied rights relating to financial assurances arising from Section 2-609 of the Uniform Commercial Code (as contained in the Texas Business and Commerce Code) or
applicable case law applying similar doctrines are hereby waived. 
 SECTION 17. ASSIGNMENTS AND COOPERATION WITH FINANCING 
 17.1 Assignment Not Allowed. Except as provided in this Section 17, neither Buyer nor Seller shall assign any rights or obligations under this Agreement
unless the other Party consents thereto in writing, which consent shall not be unreasonably withheld, conditioned, or delayed. 
 17.2 Assignment to
Affiliate. Either Party, without the consent of the other Party, may assign rights or delegate obligations under this Agreement, in whole or in part, upon thirty (30) Days’ prior Notice to the other Party, to an Affiliate who assumes
the obligations delegated under this Agreement. A Party that assigns rights or delegates obligations to an Affiliate shall do so in writing, and shall provide a copy of such writing to the other Party. In all circumstances, the Party who initiates
an assignment or delegation shall remain liable to the other Party for its Affiliate’s full performance of the assigning Party’s obligations under this Agreement. 
 17.3 Assignment for Financing. Seller may, without consent of Buyer, assign this Agreement as security in connection with any Financing. 
 17.4 Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective, authorized successors and assigns. 
 17.5 Cooperation with Financing. Seller contemplates obtaining debt financing for all or part of the cost of Seller’s Facility consisting of one or more
construction or permanent loans to be secured by all or a portion of Seller’s Facility and its rights under this Agreement and certain equity contributions from the shareholders of Seller (together, the “Financing”). In
the event Seller applies for 

  

 22 

 
or obtains any Financing or any refinancing thereof, Buyer shall promptly execute or consent to a consent and agreement in form and substance reasonably
satisfactory to Buyer and Seller, including any additional terms or provisions reasonably requested by any participant in the Financing (a “Financing Participant”) that do not impose additional liability or cost on Buyer or
diminish its rights hereunder, and other similar documents, including but not limited to any amendments to this Agreement, reasonably required by any Financing Participant in connection with such Financing or refinancing thereof. 
 SECTION 18. CONFIDENTIALITY 
 Each Party shall
maintain as confidential all provisions of this Agreement that pertain to the quality, pricing and escalation of the pricing of Carbon, and all business records relating to the negotiation of this Agreement and the Parties’ performance of their
respective obligations hereunder. Notwithstanding the foregoing, each Party may disclose such information to its employees who have a need to know and to its board of directors or other internal governing body, Affiliates, independent auditors,
bankers, brokers, consultants, Financing Participants and advisors, provided that such persons agree with such Party (and such Party remains obligated to the other Party for any breach thereof by such persons) to the same confidentiality
obligations contained in this Agreement. Except as otherwise expressly provided in this Section 18, neither Buyer nor Seller shall make public the existence of this Agreement, the term of this Agreement, or the pounds of Carbon covered by this
Agreement without the prior written consent of the other party, such consent not to be unreasonably withheld, conditioned, or delayed. Buyer and Seller acknowledge specifically that this provision shall not prohibit the disclosure of confidential
information: 
  

	(i)	to an independent firm of Certified Public Accountants for the purpose of auditing and verifying price calculations under or pursuant to this Agreement; 

  

	(ii)	to consultants and contractors performing work related to this Agreement who agree in writing to protect the confidentiality of such information as and to the extent provided in
this Agreement; and 

  

	(iii)	as required by applicable SEC rules and regulations. 

 In
the foregoing situations, the Party disclosing information shall comply with any specific confidentiality requirement(s) imposed by this Agreement, shall notify the other Party as soon as practicable prior to disclosure, and shall otherwise take
reasonable measures to limit the disclosure of confidential information in a manner consistent with Applicable Law. Such measures shall include, as appropriate and permitted by Applicable Law, filing documents under seal, redacting specific pricing
information from disclosed documents, and disclosing documents subject to court-approved protective orders. 
 If the Party receiving information hereunder
or any of its representatives are requested or required to disclose any information pursuant to a subpoena, court order, civil investigative demand or similar judicial process or other oral or written request issued by a court of competent
jurisdiction or by an international, national, state or local governmental or regulatory body, the receiving party 

  

 23 

 
will provide the disclosing party with prompt written notice of any such request or requirement so that the disclosing party or any of its representatives
may seek an appropriate protective order or other appropriate remedy or waive compliance. If such order or other remedy is not obtained, or the disclosing party waives compliance with the provisions of this Agreement, the receiving party or its
representatives, as the case may be, will disclose only that portion of the information which it is advised by counsel it is legally required to so disclose and will exercise reasonable efforts to obtain reliable assurance that confidential
treatment will be accorded the information so disclosed. 
 SECTION 19. NOTICES 
 19.1 General Notices. Except as otherwise specifically provided by this Agreement, any notice provided for pursuant to this Agreement or given or made in connection with this Agreement shall be in writing and
shall be deemed properly and sufficiently given or made if delivered in person with receipt acknowledged in writing by the recipient, or sent by registered or certified mail return receipt requested, to the respective Parties at the addresses
specified below: 
 If to Seller, addressed to: 
 ADA-ES, Inc. 
 8100 SouthPark Way, Unit B 
 Littleton, Colorado 80120-4525 
 Attention: Jean Bustard, COO 
 With a copy to: 
 Fox Rothschild LLP 
 997 Lenox Drive, Building 3 
 Lawrenceville, New Jersey 08648 
 Attention: Jonathan Lagarenne, Esq. 
 If to Buyer, addressed to: 
 Luminant Generation Company LLC 
 500 North Akard Street 
 Dallas, Texas 75201 
 Attention: General Counsel 
 With a copy to: 
 Luminant Generation Company LLC 
 500 North Akard Street 
 Dallas, Texas 75201 
 Attention: Director Strategic Sourcing 
  

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 19.2 Effectiveness. No notice is effective unless it is given or made in compliance with Section 19.1.
Notices given or made in compliance with Section 19.1 are effective as of the time of delivery to or receipt by the Party to whom the notice is addressed. 
 19.3 Changes in Persons and Addresses. The persons or address of any Party to which notice shall be given pursuant to this Agreement may be changed at any time pursuant to this Section 19.3 by giving notice to the other Party.

 SECTION 20. WAIVERS 
 The failure of either Party to
require strict performance of any provision of this Agreement by the other Party, or the forbearance to exercise any right or remedy under this Agreement, shall not be construed as a waiver by such Party of the right to require strict performance of
any such provision or the relinquishment by such Party of any such right or remedy it might have with respect to any subsequent breach of such provisions. All waivers shall be signed in writing, designated a waiver, and signed by the waiving Party,
and shall recite the rights waived. 
 SECTION 21. HEADINGS AND SECTION NUMBERS—CONSTRUCTION 
 21.1 Headings Not to Affect Construction. The headings of the sections of this Agreement are inserted for convenience only and shall have no effect on the
construction, interpretation, or meaning of this Agreement. 
 21.2 References to Section Numbers. All references in this Agreement to a section of
this Agreement will be interpreted to refer to the entire section, including subsections. For example, a reference to Section 1, Defined Terms, refers not only to the introductory text on Section 1, but also to all of the subsections of
Section 1. 
 SECTION 22. AMENDMENTS 
 Any and all
amendments, supplements, and modifications to this Agreement shall be effective only if in writing and signed by the Parties. 
 SECTION 23. COMPLETE
AGREEMENT 
 This Agreement is the complete and total expression of all agreements, contracts, covenants, and other promises between Seller and Buyer
related to the sale of Carbon to Buyer. 
 SECTION 24. COUNTERPARTS 
 Buyer and Seller may execute this Agreement in two or more counterparts, each of which shall constitute an original document and all of which taken together shall constitute a single Agreement. 
  

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 SECTION 25. SECURITY 
 25.1 Seller Guarantee. Prior to or concurrently with the execution and delivery of this Agreement, Seller shall procure a parent company guarantee from ADA-ES, Inc. guaranteeing Seller’s performance hereunder in a form as
specified in Exhibit 6 hereto. This parent guarantee (a) shall be replaced by a $1 million letter of credit in the form set forth in Exhibit 7A1 to cover the early termination liquidated damages set forth in Exhibit 9 no later than
January 15, 2009 and (b) shall expire upon Financial Close and the posting of the Seller’s Letter of Credit as set forth below in Section 25.2. 
 25.2 Seller’s Letter of Credit. 
 Within five (5) business days after Financial Close, Seller shall deliver to Buyer, as collateral
for the full performance by Seller of all of its obligations under this Agreement and for all losses and damages Buyer may suffer as a result of any default by Seller under this Agreement, a standby, unconditional, irrevocable, transferable letter
of credit (the “Seller’s Letter of Credit”) in the form of Exhibit 7A2 hereto and containing the terms required therein, in the face amount of Ten Million Dollars ($10,000,000.00) (the “Seller’s Letter of
Credit Amount”), naming Buyer as beneficiary, issued (or confirmed) by a financial institution rated at least A3 by Moody’s Investor Services, Inc. and at least A- by Standard and Poor’s Ratings Group, Inc., permitting
multiple and partial draws thereon. Seller shall cause the Seller’s Letter of Credit to be continuously maintained in effect (whether through replacement, renewal or extension) in the Seller’s Letter of Credit Amount as reduced for
drawings through the Term of this Agreement. If the Seller’s Letter of Credit held by Buyer expires during the Term of this Agreement (whether by reason of a stated expiration date or a notice of termination or non-renewal given by the issuing
bank), Seller shall deliver a new Seller’s Letter of Credit or certificate of renewal or extension to Buyer not later than thirty (30) Days prior to the expiration date of the Seller’s Letter of Credit then held by Buyer. Any renewal
or replacement Seller’s Letter of Credit shall comply with all of the provisions of this Section 25.2, shall be irrevocable and transferable and shall remain in effect (or be automatically renewable) through December 31, 2014 (the
“Final LC Expiration Date”) upon the same terms as the expiring Seller’s Letter of Credit or such other terms as may be acceptable to Buyer in its sole discretion. 
 Buyer shall have the right to draw upon the Seller’s Letter of Credit, in whole or in part, at any time and from time to time in accordance with the terms thereof.

 Buyer shall have the right to draw upon the Seller’s Letter of Credit, in whole or in part, at any time and from time to time if the Seller’s
Letter of Credit held by Buyer expires earlier than the Final LC Expiration Date (whether by reason of a stated expiration date or a notice of termination or non-renewal given by the issuing bank), and Seller fails to deliver to Buyer, at least
thirty (30) Days prior to the expiration date of the Seller’s Letter of Credit then held by Buyer, a renewal or substitute Seller’s Letter of Credit that is in effect and that complies with the provisions of this Section 25.2.

 No condition or term of this Agreement shall be deemed to render the Seller’s Letter of Credit conditional to justify the issuer of the Seller’s
Letter of Credit in failing to honor a drawing upon the Seller’s Letter of Credit in a timely manner. Seller hereby acknowledges and agrees that Buyer is entering into this Agreement in material reliance upon the ability of Buyer to draw upon
the Seller’s Letter of Credit upon the occurrence of any Event of Default by Seller under this Agreement or upon the occurrence of any of the other events described above in this Section 25.2. 
  

 26 

 25.3 Buyer’s Letter of Credit 
 Concurrently with Seller’s delivery of a letter of credit in accordance with Section 25.2 above, Buyer shall deliver to Seller, as collateral for the full performance by Buyer of all of its obligations under
this Agreement and for all losses and damages Seller may suffer as a result of any default by Buyer under this Agreement, a standby, unconditional, irrevocable, transferable letter of credit (the “Buyer’s Letter of
Credit”) in the form of Exhibit 7B hereto and containing the terms required therein, in the face amount of Ten Million Dollars ($10,000,000.00) (the “Buyer’s Letter of Credit Amount”), naming Seller as
beneficiary, issued (or confirmed) by a financial institution rated at least A3 by Moody’s Investor Services, Inc. and at least A- by Standard and Poor Ratings Group, Inc., permitting multiple and partial draws thereon. Buyer shall cause the
Buyer’s Letter of Credit to be continuously maintained in effect (whether through replacement, renewal or extension) in the Buyer’s Letter of Credit Amount as reduced for drawings through the Term of this Agreement. If the Buyer’s
Letter of Credit held by Seller expires during the Term of this Agreement (whether by reason of a stated expiration date or a notice of termination or non-renewal given by the issuing bank), Buyer shall deliver a new Buyer’s Letter of Credit or
certificate of renewal or extension to Seller not later than thirty (30) Days prior to the expiration date of the Buyer’s Letter of Credit then held by Seller. Any renewal or replacement letter of credit shall comply with all of the
provisions of this Section 25.3, shall be irrevocable, and transferable and shall remain in effect (or be automatically renewable) through the Final LC Expiration Date upon the same terms as the expiring Letter of Credit or such other terms as
may be acceptable to Seller in its sole discretion. 
 Seller shall have the right to draw upon the Buyer’s Letter of Credit, in whole or in part, at
any time and from time to time as set forth in accordance with the terms thereof. 
 Seller shall have the right to draw upon the Buyer’s Letter of
Credit, in whole or in part, at any time and from time to time if the Buyer’s Letter of Credit held by Seller expires earlier than the Final LC Expiration Date (whether by reason of a stated expiration date or a notice of termination or
non-renewal given by the issuing bank), and Buyer fails to deliver to Seller, at least thirty (30) Days prior to the expiration date of the Buyer’s Letter of Credit then held by Seller, a renewal or substitute Buyer’s Letter of Credit
that is in effect and that complies with the provisions of this Section 25.3. 
 No condition or term of this Agreement shall be deemed to render the
Buyer’s Letter of Credit conditional to justify the issuer of the Buyer’s Letter of Credit in failing to honor a drawing upon such Letter of Credit in a timely manner. Buyer hereby acknowledges and agrees that Seller is entering into this
Agreement in material reliance upon the ability of Seller to draw upon the Buyer’s Letter of Credit upon the occurrence of any Event of Default by Buyer under this Agreement or upon the occurrence of any of the other events described above in
this Section 25.3. 
  

 27 

 SECTION 26. INDEMNITY 
 Subject to limitations of liability provided in this Agreement and to the extent associated remedies are specified, the Parties agree to the following: 
 26.1 Buyer agrees to and will defend, protect, indemnify and hold harmless Seller Group from and against all claims, losses, expenses, damages, demands, judgments, causes of action, suits, and liability in tort, contract, or any
other basis and of every kind and character whatsoever (hereinafter in this and the following paragraphs collectively referred to as “Claims”), arising out of or incident to, directly or indirectly, this Agreement to the
extent such Claims are caused by, or attributable to, the negligence, or other fault of any nature, of any member of Buyer Group. 
 26.2 Seller
agrees to and will defend, protect, indemnify and hold harmless Buyer Group from and against all Claims arising out of or incident to, directly or indirectly, this Agreement, to the extent such Claims are caused by, or attributable to the
negligence, or other fault of any nature, of any member of Seller Group. 
 26.3 Seller represents and warrants that it is the owner or licensee of
all proprietary information and technology used in the manufacture of Carbon, specifically including all trade secret and confidential information related to the production of Carbon. Seller further represents and warrants that its rights in the
proprietary information and technology used in the manufacture the Carbon, specifically including all trade secret and confidential information related to the production of the Carbon, are not violative of the rights of any third party, specifically
including Norit Americas, Inc. Seller agrees to indemnify, defend and hold harmless Buyer Group against any and all claims and to pay any damages awarded based on allegations which, if true, would constitute a breach of the foregoing representations
and warranties. *. 
 26.4 To the extent necessary to permit either party to enforce any term, clause or condition of this Agreement, each party
agrees that with respect to any Claims brought against either party, each party will and does hereby waive as to the other any defense it may have by virtue of the workers’ compensation laws of any state. 
 [Remainder of page intentionally left blank.] 
  

 28 

 IN WITNESS WHEREOF, the Parties have duly executed this Agreement in their respective corporate
names as of the 3rd day of September, 2008. 
  

			
	SELLER
	
	Red River Environmental Products, LLC
		
	 By:
	 	 /s/ C. Jean Bustard

	 Name:
	 	 C. Jean Bustard

	 Title:
	 	 Chief Operating Officer

	
	BUYER
	
	Luminant Generation Company LLC
		
	 By:
	 	 /s/ Charles R. Enze

	 Name:
	 	 Charles R. Enze

	 Title:
	 	 CEO, Generation Construction

  

 29 

 EXHIBIT 1 
 Carbon Specifications 
 Specifications and Typical Properties 
  

			
	Product Name	  	Power PAC PREMIUM
	 Description
	  	Bromine-enhanced powdered activated carbon
	Product Specifications	  	
	 Moisture
	  	*
	 Size
	  	*
	Typical Properties	  	
	 Tap Density
	  	*
	 Surface Area
	  	*
	 Iodine Number
	  	*
	 Percent Active Chemical
	  	*
	 Ignition Temperature
	  	*

  

	*	

  

 1 

 EXHIBIT 1A 
 Manufactured Carbon 
 Sampling and Testing Protocols 
  

	*	

  

 2 

 EXHIBIT 1B 
 Processed Carbon 
 Sampling and Testing Protocols 
  

	*	

  

 3 

 EXHIBIT 2 
 Carbon Purchase Commitment 
  

			
	Commitment:	  	*
	Volume commitment	  	

			
	Date:	  	*

  

			
	Annual Commitment:	  	Projected usage schedule to be determined and assigned in the format below:

 Schedule Ranges: 
  

																	
	 	 	 	  	2009	  	2010	  	2011	  	2012	  	2013	  	2014	  	Total
	 Low Demand Projection Scenario
 (Based on *)
	 		  	*	  	*	  	*	  	*	  	*	  	*	  	*
	 Low Demand Scenario Incorporating
 -*% Annual Minimum Tolerance
 (See Note 4)
	 		  	*	  	*	  	*	  	*	  	*	  	*	  	
	 High Demand Projection Scenario
 (Based on *)
	 		  	*	  	*	  	*	  	*	  	*	  	*	  	*
	 High Demand Scenario Incorporating
 +*% Annual Maximum Tolerance
 (See Note 5)
	 		  	*	  	*	  	*	  	*	  	*	  	*	  	

 Early Supply Ranges: 
  

									
	 	 	 	  	2009	  	1Q 2010	  	Total
	 Low Demand Projection Scenario
 (Based on *)
	 		  	*	  	*	  	*
	 Low Demand Scenario Incorporating
 -*% Annual Minimum Tolerance
 (See Note 4)
	 		  	*	  	*	  	*
	 High Demand Projection Scenario
 (Based on *)
	 		  	*	  	*	  	*
	 High Demand Scenario Incorporating
 +*% Annual Maximum Tolerance
 (See Note 5)
	 		  	*	  	*	  	*

  

 4 

 Notes: 
  

	1)	Units of measure for above projection ranges are pounds. 

  

	2)	Ranges provided above are for informational purposes only, and establish the annual parameters for projected commitment levels to be provided on or before*.

  

	3)	Pursuant to Section 4 of the Agreement, Buyer shall provide Annual Nomination to Seller sixty (60) days prior to each Contract Year. 

  

	4)	In accordance with Section 4 of the Agreement, *% tolerance calculation applied to low demand scenario to reflect lowest possible demand parameter for specified Contract Year.
If realized, Buyer would increase Annual Nominations in subsequent years consistent with achieving minimum commitment of * pounds. 

  

	5)	In accordance with Section 4 of the Agreement, *% tolerance calculation applied to high demand scenario to reflect highest possible demand parameter for specified Contract
Year. If realized, Buyer would decrease Annual Nominations in subsequent years consistent with achieving maximum commitment of * pounds. 

  

	6)	Buyer and Seller agree to establish cap on 2009 delivery requirement not to exceed * pounds. If 2009 cap is realized, maximum commitment over term of the contract would be equitably
reduced to * pounds. 

  

 5 

 EXHIBIT 2A 
 Call Option Commitment 
  

											
	 Contract Year
	  	2010	  	2011	  	2012	  	2013	  	2014
	 Maximum Increase Amount
	  	*	  	*	  	*	  	*	  	*

  

 6 

 EXHIBIT 3 
 Base Price 
  

	*	

  

 7 

 EXHIBIT 4 
 Milestones 
  

							
	 Milestone
	  	Milestone Date	  	Actual Date(1)	  	Cure
Period
(in Days)
	*	  	*	  	*	  	*
	*	  	*	  	*	  	*
	*	  	*	  	*	  	*
	*	  	*	  	*	  	*
	*	  	*	  	*	  	*
	*	  	*	  	*	  	*
	*	  	*	  		  	*
	*	  	*	  		  	*
	*	  	*	  	*	  	*
	*	  	*	  		  	*
	*	  	*	  		  	*
	*	  	*	  		  	*
	*	  	*	  		  	*
	*	  	*	  		  	*
	*	  	*	  		  	*
	*	  	*	  		  	*
	*	  	*	  		  	*

  

	(1)	* 

  

 8 

 EXHIBIT 5 
 Cost Methodology for Delivery of Carbon to Buyer’s Facility 
  

			
	 Delivery: 
	  	Carbon shipped from Seller’s Facility or otherwise from Coushatta, Louisiana will be shipped with freight prepaid and added.

  

			
	Source Location:	  	If Carbon is sourced from a location other than Seller’s Facility or otherwise in Coushatta, Louisiana, freight will be calculated at the lesser of (1) actual freight charges and
(2) freight charges as if such Carbon were delivered from Seller’s Facility or otherwise in Coushatta, Louisiana.

  

 9 

 EXHIBIT 6 
 Form of Parent Guarantee 
 PARENT COMPANY GUARANTEE 
 This Guarantee given and delivered by ADA-ES, Inc., with a principal address of 8100 SouthPark Way, Littleton, CO 80120, herein called “Guarantor,” to Luminant
Generation Company LLC, herein called “Buyer,” with respect to Carbon Supply Agreement, dated as of September 3, 2008 (herein called “Supply Agreement”), between Buyer and Red River Environmental Products, LLC (herein called
“Affiliate”) for the supply of powdered activated Carbon (as defined in the Supply Agreement). 
 WITNESSETH 
 That in order to induce Buyer to enter into the Supply Agreement with Affiliate, an affiliated company of Guarantor, and in consideration of Buyer entering into the
Supply Agreement with Affiliate, the Guarantor has determined that executing this Guarantee is in its interest and to its financial benefit and it is hereby agreed as follows: 
  

	1.	Guarantor, for itself, its successors and permitted assigns, hereby irrevocably and unconditionally guarantees, jointly and severally, to Buyer, its successors and permitted
assigns, as primary obligor and not as surety, the full and faithful performance by Affiliate, its successors and assigns of each and every one of the terms, provisions, conditions, obligations and agreements on the part of Affiliate to be made,
carried out, performed or observed as provided in the Supply Agreement. 

  

	2.	If at any time default is made by Affiliate in the performance of any of the terms, provisions, conditions, obligations and agreements or in any other matter or thing pertaining to
the Supply Agreement or in the payment of any sums payable pursuant thereto which are to be made, carried out, performed, paid or observed by Affiliate, Guarantor will well and truly perform, or cause to be so performed, such terms, provisions,
conditions, obligations and agreements and such other matter or thing pertaining to the Supply Agreement including the payment on demand of any sums payable pursuant thereto. Except as provided in and subject to the terms of this Guarantee, any
monies which are payable by Affiliate pursuant to the Supply Agreement which may not be recoverable from Affiliate shall nevertheless be recoverable by Buyer from Guarantor as if Guarantor were principal debtor. All payments by Guarantor hereunder
shall be made in full, without set-off or counterclaim and free and clear of any deductions or withholdings in immediately available, freely transferable, cleared funds to the account of Buyer as notified to Guarantor by Buyer.

  

 10 

	3.	Guarantor’s aggregate obligations under this Guarantee shall be limited to $1 million. 

  

	4.	Guarantor agrees that its obligations hereunder shall not be discharged nor shall they be affected by reason of: (i) any legal limitations, disabilities, incapacities or want
of powers on the part of Affiliate to enter into the Supply Agreement; or (ii) the invalidity or unenforceability of the obligations of Affiliate under the Supply Agreement arising from or related to the liquidation, winding up or dissolution
of Affiliate; or (iii) the appointment of or acts of a receiver or liquidator on behalf of Affiliate (including, without limitation, the ability of any liquidator of Affiliate to disclaim obligations of Affiliate arising under the Supply
Agreement). 

  

	5.	Guarantor covenants and agrees with Buyer, its successors and permitted assigns that (i) waiver by Buyer of any of the terms, provisions, conditions, obligations and agreements
of the Supply Agreement, (ii) any modification or changes to the Supply Agreement, (iii) the giving of any consent to an assignment or the making of any assignment of the Supply Agreement and (iv) the granting of extensions of time to
Affiliate, its successors and permitted assigns may all or any of them be made and done without notice to Guarantor and without in any way affecting, changing or releasing Guarantor from its obligations given under this Guarantee, and such changes
or extensions of time may be granted, such waiver and consents may be given and such modifications and assignments may be made without notice to or the consent of Guarantor and without impairing the obligations of the Guarantee hereby given.

  

	6.	Buyer may enforce this Guarantee without first making demand on, or taking any proceeding against, Affiliate or resorting to any other security, guarantee or other means of payment
and no action (or inaction) by Buyer in respect of any such security, guarantee or other means of payment shall prejudice or affect Buyer’s rights under this Guarantee. The Guarantor irrevocably waives acceptance hereof, presentment, demand,
protest and, to the fullest extent permitted by law, any notice not provided for herein. 

  

	7.	Subject to the terms of this Guarantee, the Guarantor shall have all of the contractual protections, limitations, exclusions and rights which Affiliate has under the Supply
Agreement. 

  

	8.	If a demand, in accordance with this Guarantee, is made upon the Guarantor and the Guarantor duly and properly performs the obligations of Affiliate then, to that extent only,
Affiliate shall be released from such obligations by the Buyer. 

  

	9.	This Guarantee shall expire upon final fulfillment by Affiliate of all its obligations under the Supply Agreement. 

  

	10.	On notice to the Guarantor, this Guarantee may be assigned by Buyer to any legal entity or entities to whom Buyer’s rights and/or obligations under the Supply Agreement are
assigned. 

  

 11 

	11.	Guarantor represents and warrants that: 

 (a) It is a
corporation, partnership or limited liability company duly and properly incorporated or organized, as the case may be, validly existing and (to the extent such concept applies to such entity) in good standing under the laws of its jurisdiction of
incorporation or organization and has all requisite authority to conduct its business in each jurisdiction in which its business is conducted. 
 (b) It has the power and authority and legal right to execute and deliver this Guarantee and to perform its obligations hereunder. The execution and delivery by it of this Guarantee and the performance of its obligations hereunder have been
duly authorized by proper corporate proceedings, and this Guarantee constitutes a legal, valid and binding obligation of Guarantor enforceable against it in accordance with its terms. 
 (c) Neither the execution and delivery by it of this Guarantee, nor the consummation of the transactions herein contemplated, nor compliance with the
provisions hereof will violate (i) any law, rule, regulation, order, writ, judgment, injunction, decree or award binding on it or any of its subsidiaries or (ii) its articles or certificate of incorporation, partnership agreement,
certificate of partnership, articles or certificate of organization, by-laws, or operating or other management agreement, as the case may be, or (iii) the provisions of any indenture, instrument or agreement to which it or any of its
subsidiaries is a party or is subject, or by which it is bound, or conflict with or constitute a default thereunder. No order, consent, adjudication, approval, license, authorization, or validation of, or filing, recording or registration with, or
exemption by, or other action in respect of any governmental or public body or authority, or any subdivision thereof, which has not been obtained by it or any of its subsidiaries, is required to be obtained by it or any of its subsidiaries in
connection with the execution and delivery of this Guarantee or the performance by it of its obligations hereunder or the legality, validity, binding effect or enforceability of this Guarantee. 
  

	12.	 This Guarantee is governed by, and shall be construed in accordance with, the laws of the state of Texas without reference to the conflict of laws rules thereof.
This Guarantee is intended to be fully enforceable in accordance with its terms and constitutes a guarantee of Affiliate’s obligations and liabilities arising out of or in connection with the Supply Agreement. In the event that any issue,
matter or dispute arises under the Supply Agreement which is resolved under the Supply Agreement, including any issue, matter or dispute which is resolved in accordance with the dispute resolution provisions under the Supply Agreement, 

  

 12 

	 	 
such issue, matter or dispute shall be deemed to have been conclusively determined for the purpose of this Guarantee and neither party to this Guarantee will
thereafter take any steps to argue that such issue, matter or dispute should be resolved under this Guarantee in any different manner from the resolution under the Supply Agreement and the parties waive any right to do so.

  

	13.	TO THE EXTENT PERMITTED BY LAW, THE PARTIES HERETO AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS GUARANTEE, SHALL BE TRIED AND LITIGATED ONLY IN THE COURTS
LOCATED IN THE COUNTY OF DALLAS, STATE OF TEXAS. THE PARTIES, TO THE EXTENT THEY MAY LEGALLY DO SO, WAIVE ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY PROCEEDING IS BROUGHT IN
ACCORDANCE WITH THIS ARTICLE AND STIPULATE THAT THE COURTS LOCATED IN THE COUNTY OF DALLAS, STATE OF TEXAS SHALL HAVE IN PERSONAM JURISDICTION AND VENUE OVER SUCH PARTY FOR THE PURPOSE OF LITIGATING ANY SUCH DISPUTE, CONTROVERSY, OR PROCEEDING
ARISING OUT OF OR OTHERWISE RELATED TO THIS GUARANTEE. THE PARTIES EACH HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING
OUT OF OR RELATING TO THIS GUARANTEE. EACH PARTY AGREES THAT IT WILL NOT FILE ANY MOTION OR ASSERT ANY DEFENSE IN ANY SUCH PROCEEDING THAT IS INCONSISTENT WITH THE FOREGOING AGREEMENTS, WAIVERS, CONSENTS OR STIPULATIONS. AS OF THE EFFECTIVE DATE OF
THIS GUARANTEE. 

 [SIGNATURE PAGE TO FOLLOW] 
  

 13 

 IN WITNESS WHEREOF, Guarantor has executed this Guarantee this 9th day of September, 2008. 
  

			
	Signed:	 	 /s/ C. Jean Bustard

	Name:	 	C. Jean Bustard
	Title:	 	Chief Operating Officer

  

 14 

 EXHIBIT 7A1 
 Form of Seller’s $1 Million Letter of Credit 
 DATE:
                                        

  

			
	 IRREVOCABLE STANDBY
 LETTER OF
CREDIT
	 	OUR NO.
		
		 	APPLICANT
		
	 BENEFICIARY
  
 Luminant Generation Company LLC
	 	 AMOUNT
  
 U.S. $1,000,000
  
 EXPIRY

 
 June 15, 2009

 GENTLEMEN: 
 BY ORDER
OF OUR
CLIENT,                                        
                         FOR THE ACCOUNT OF
                                         
   , WE HEREBY ESTABLISH OUR IRREVOCABLE LETTER OF CREDIT
NO.                                        
     IN YOUR FAVOR FOR DRAWINGS NOT TO EXCEED THE AGGREGATE SUM OF ONE MILLION DOLLARS ($1,000,000), EFFECTIVE IMMEDIATELY. THIS LETTER OF CREDIT IS ISSUED, PRESENTABLE AND PAYABLE AT THE OFFICE OF OUR
SERVICER,                                       
                                         
                                         
                   , AND EXPIRES WITH THEIR CLOSE OF BUSINESS ON
                                         
                           . 
  

 15 

 FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO YOU AGAINST YOUR SIGHT DRAFT(S), DRAWN ON US, MENTIONING THEREON OUR
LETTER OF CREDIT NO.                                      AND
ACCOMPANIED BY THE FOLLOWING: 
 A WRITTEN STATEMENT PURPORTEDLY SIGNED BY AN AUTHORIZED REPRESENTATIVE OR OFFICER OF THE BENEFICIARY READING AS FOLLOWS:

 “WE HEREBY CERTIFY THAT RED RIVER ENVIRONMENTAL PRODUCTS, LLC (“SELLER”) IS IN BREACH OF SECTION
             OF THE CARBON SUPPLY AGREEMENT DATED AS OF
                             BETWEEN SELLER AND THE BENEFICIARY (THE “SUPPLY AGREEMENT”) AND
HAS FAILED TO CURE SUCH BREACH AND THE BENEFICIARY IS ENTITLED TO DRAW ON THIS STANDBY LETTER OF CREDIT NO.
                             UNDER THE PROVISIONS OF SECTION
             OF THE SUPPLY AGREEMENT.” 
 THE AMOUNT, WHICH MAY BE DRAWN BY YOU UNDER
THIS LETTER OF CREDIT, SHALL BE AUTOMATICALLY REDUCED BY THE AMOUNT OF ANY DRAWINGS PAID THROUGH THE ISSUING BANK REFERENCING THIS LETTER OF CREDIT NO.
                            . 
 WE HEREBY ENGAGE WITH YOU THAT ALL DRAFTS DRAWN UNDER AND IN STRICT COMPLIANCE WITH THE TERMS OF THIS CREDIT WILL BE DULY HONORED IF DRAWN AND PRESENTED FOR PAYMENT ON OR BEFORE THE EXPIRY DATE OF THIS CREDIT. WE
SHALL EFFECT PAYMENT THREE BUSINESS DAYS AFTER RECEIPT OF DOCUMENTS IN STRICT CONFORMITY WITH THE TERMS OF THIS LETTER OF CREDIT. AS USED IN THIS LETTER OF CREDIT, THE TERM “BUSINESS DAY” MEANS ANY DAY OF THE YEAR IN WHICH BANKS LOCATED IN
NEW YORK CITY ARE NOT AUTHORIZED OR REQUIRED BY LAW OR EXECUTIVE ORDER TO CLOSE. 
 THIS LETTER OF CREDIT IS SUBJECTED TO AND GOVERNED BY LAWS OF THE STATE
OF NEW YORK AND THE 2007 REVISION OF THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS OF THE INTERNATIONAL CHAMBER OF COMMERCE (PUBLICATION NO. 600). IN THE EVENT OF ANY CONFLICT, THE LAWS OF THE STATE OF NEW YORK WILL CONTROL. 

 

 16 

 SHOULD YOU HAVE OCCASION TO COMMUNICATE WITH US REGARDING THIS CREDIT, KINDLY DIRECT YOUR COMMUNICATIONS TO THE ATTENTION
OF OUR LETTER OF CREDIT DEPARTMENT                             , MAKING SPECIFIC REFERENCE TO OUR
LETTER OF CREDIT NO.                             . 
  

 17 

 EXHIBIT 7A2 
 Form of Seller’s $10 Million Letter of Credit 
 DATE:
                                        

  

			
	 IRREVOCABLE STANDBY
 LETTER OF
CREDIT
	 	OUR NO.
		
		 	APPLICANT
		
	 BENEFICIARY
  
 Luminant Generation Company LLC
	 	 AMOUNT
  
 U.S. $10,000,000
  
 EXPIRY
  
 _______________________________

 GENTLEMEN: 
 BY ORDER
OF OUR
CLIENT,                                        
                             FOR THE ACCOUNT OF
                                         
   , WE HEREBY ESTABLISH OUR IRREVOCABLE LETTER OF CREDIT
NO.                                        
     IN YOUR FAVOR FOR DRAWINGS NOT TO EXCEED THE AGGREGATE SUM OF TEN MILLION DOLLARS ($10,000,000), EFFECTIVE IMMEDIATELY. THIS LETTER OF CREDIT IS ISSUED, PRESENTABLE AND PAYABLE AT THE OFFICE OF OUR
SERVICER,                                       
                                         
                                         
                   , AND EXPIRES WITH THEIR CLOSE OF BUSINESS ON
                                         
                           . 
  

 18 

 FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO YOU AGAINST YOUR SIGHT DRAFT(S), DRAWN ON US, MENTIONING THEREON OUR
LETTER OF CREDIT NO.                                      AND
ACCOMPANIED BY THE FOLLOWING: 
 A WRITTEN STATEMENT PURPORTEDLY SIGNED BY AN AUTHORIZED REPRESENTATIVE OR OFFICER OF THE BENEFICIARY READING AS FOLLOWS:

 “WE HEREBY CERTIFY ... 
  

	 	(I)	“(A) RED RIVER ENVIRONMENTAL PRODUCTS, LLC (“SELLER”) HAS CONTRACTUAL OBLIGATIONS TO THE BENEFICIARY WHICH EXTEND BEYOND THE EXPIRATION DATE OF THIS STANDBY LETTER OF
CREDIT, AND (B) SELLER HAS NOT PROVIDED A SUBSTITUTE STANDBY LETTER OF CREDIT PRIOR TO THIRTY (30) DAYS BEFORE THE EXPIRATION DATE OF THIS STANDBY LETTER OF CREDIT, AND (C) THE BENEFICIARY IS THEREFORE DRAWING UPON THIS STANDBY LETTER
OF CREDIT AND WILL HOLD THE PROCEEDS AS SECURITY UNTIL APPLICATION AGAINST AMOUNTS WHICH BECOME DUE TO THE BENEFICIARY UNDER THE CARBON SUPPLY AGREEMENT DATED AS OF
                             BETWEEN SELLER AND THE BENEFICIARY OR A SUBSTITUTE STANDBY LETTER OF
CREDIT IS PROVIDED.”, OR 

  

	 	(II)	“RED RIVER ENVIRONMENTAL PRODUCTS, LLC (“SELLER”) IS IN BREACH OF ITS COVER OBLIGATIONS SET FORTH IN SECTION 15 OF THE CARBON SUPPLY AGREEMENT DATED AS OF
                         BETWEEN SELLER AND THE BENEFICIARY (THE “SUPPLY AGREEMENT”), 

 

	 	(III))	AND BUYER IS ENTITLED TO DRAW ON THIS STANDBY LETTER OF CREDIT NO.
                         UNDER THE PROVISIONS OF SECTION
             OF THE SUPPLY AGREEMENT.” 

 THE AMOUNT, WHICH MAY BE
DRAWN BY YOU UNDER THIS LETTER OF CREDIT, SHALL BE AUTOMATICALLY REDUCED BY THE AMOUNT OF ANY DRAWINGS PAID THROUGH THE ISSUING BANK REFERENCING THIS LETTER OF CREDIT NO.
                        . 
  

 19 

 PARTIAL DRAWINGS ARE PERMITTED HEREUNDER. 
 WE HEREBY ENGAGE WITH YOU THAT ALL DRAFTS DRAWN UNDER AND IN STRICT COMPLIANCE WITH THE TERMS OF THIS CREDIT WILL BE DULY HONORED IF DRAWN AND PRESENTED FOR PAYMENT ON OR BEFORE THE EXPIRY DATE OF THIS CREDIT. WE
SHALL EFFECT PAYMENT THREE BUSINESS DAYS AFTER RECEIPT OF DOCUMENTS IN STRICT CONFORMITY WITH THE TERMS OF THIS LETTER OF CREDIT. AS USED IN THIS LETTER OF CREDIT, THE TERM “BUSINESS DAY” MEANS ANY DAY OF THE YEAR IN WHICH BANKS LOCATED IN
NEW YORK CITY ARE NOT AUTHORIZED OR REQUIRED BY LAW OR EXECUTIVE ORDER TO CLOSE. 
 THIS LETTER OF CREDIT IS SUBJECTED TO AND GOVERNED BY LAWS OF THE STATE
OF NEW YORK AND THE 2007 REVISION OF THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS OF THE INTERNATIONAL CHAMBER OF COMMERCE (PUBLICATION NO. 600). IN THE EVENT OF ANY CONFLICT, THE LAWS OF THE STATE OF NEW YORK WILL CONTROL. 

SHOULD YOU HAVE OCCASION TO COMMUNICATE WITH US REGARDING THIS CREDIT, KINDLY DIRECT YOUR COMMUNICATIONS TO THE ATTENTION OF OUR LETTER OF CREDIT DEPARTMENT
                            , MAKING SPECIFIC REFERENCE TO OUR LETTER OF CREDIT NO.
                            . 
  

 20 

 EXHIBIT 7B 
 Form of Buyer’s Letter of Credit 
 DATE:                                      
   
  

			
	 IRREVOCABLE STANDBY
 LETTER OF
CREDIT
	 	OUR NO.
		
		 	APPLICANT
		
	 BENEFICIARY
  
 Red River Environmental Products, LLC
	 	 AMOUNT
  
 U.S. $10,000,000
  
 EXPIRY
  
 _______________________________

 GENTLEMEN: 
 BY ORDER
OF OUR CLIENT,
                                         
                            FOR THE ACCOUNT OF
                                         
   , WE HEREBY ESTABLISH OUR IRREVOCABLE LETTER OF CREDIT
NO.                                        
     IN YOUR FAVOR FOR DRAWINGS NOT TO EXCEED THE AGGREGATE SUM OF TEN MILLION DOLLARS ($10,000,000), EFFECTIVE IMMEDIATELY. THIS LETTER OF CREDIT IS ISSUED, PRESENTABLE AND PAYABLE AT THE OFFICE OF OUR SERVICER,
                                         
                                         
                                         
                 , AND EXPIRES WITH THEIR CLOSE OF BUSINESS ON
                                         
                           . 
  

 21 

 FUNDS UNDER THIS LETTER OF CREDIT ARE AVAILABLE TO YOU AGAINST YOUR SIGHT DRAFT(S), DRAWN ON US, MENTIONING THEREON OUR
LETTER OF CREDIT NO.                             AND ACCOMPANIED BY THE FOLLOWING: 
 A WRITTEN STATEMENT PURPORTEDLY SIGNED BY AN AUTHORIZED REPRESENTATIVE OR OFFICER OF THE BENEFICIARY READING AS FOLLOWS: 
 “WE HEREBY CERTIFY ... 
  

	 	(I)	“(A) LUMINANT GENERATION COMPANY LLC (“BUYER”) HAS CONTRACTUAL OBLIGATIONS TO THE BENEFICIARY WHICH EXTEND BEYOND THE EXPIRATION DATE OF THIS STANDBY LETTER OF
CREDIT, AND (B) BUYER HAS NOT PROVIDED A SUBSTITUTE STANDBY LETTER OF CREDIT PRIOR TO THIRTY (30) DAYS BEFORE THE EXPIRATION DATE OF THIS STANDBY LETTER OF CREDIT, AND (C) THE BENEFICIARY IS THEREFORE DRAWING UPON THIS STANDBY LETTER
OF CREDIT AND WILL HOLD THE PROCEEDS AS SECURITY UNTIL APPLICATION AGAINST AMOUNTS WHICH BECOME DUE TO THE BENEFICIARY UNDER THE CARBON SUPPLY AGREEMENT DATED AS OF
                         BETWEEN THE BENEFICIARY AND BUYER OR A SUBSTITUTE STANDBY LETTER OF CREDIT IS PROVIDED.”,
OR 

  

	 	(II)	“LUMINANT GENERATION COMPANY LLC (“BUYER”) IS IN BREACH OF ITS COVER OBLIGATIONS SET FORTH IN SECTION 15 OF THE CARBON SUPPLY AGREEMENT DATED AS OF
                         BETWEEN THE BENEFICIARY AND BUYER (THE “SUPPLY AGREEMENT”), AND THE BENEFICIARY IS
ENTITLED TO DRAW ON THIS STANDBY LETTER OF CREDIT NO.                          UNDER THE PROVISIONS OF SECTION
             OF THE SUPPLY AGREEMENT.” 

 THE AMOUNT, WHICH MAY BE
DRAWN BY YOU UNDER THIS LETTER OF CREDIT, SHALL BE AUTOMATICALLY REDUCED BY THE AMOUNT OF ANY DRAWINGS PAID THROUGH THE ISSUING BANK REFERENCING THIS LETTER OF CREDIT
NO.                        . 
 PARTIAL DRAWINGS ARE PERMITTED HEREUNDER. 
  

 22 

 WE HEREBY ENGAGE WITH YOU THAT ALL DRAFTS DRAWN UNDER AND IN STRICT COMPLIANCE WITH THE TERMS OF THIS CREDIT WILL BE DULY
HONORED IF DRAWN AND PRESENTED FOR PAYMENT ON OR BEFORE THE EXPIRY DATE OF THIS CREDIT. WE SHALL EFFECT PAYMENT THREE BUSINESS DAYS AFTER RECEIPT OF DOCUMENTS IN STRICT CONFORMITY WITH THE TERMS OF THIS LETTER OF CREDIT. AS USED IN THIS LETTER OF
CREDIT, THE TERM “BUSINESS DAY” MEANS ANY DAY OF THE YEAR IN WHICH BANKS LOCATED IN NEW YORK CITY ARE NOT AUTHORIZED OR REQUIRED BY LAW OR EXECUTIVE ORDER TO CLOSE. 
 THIS LETTER OF CREDIT IS SUBJECTED TO AND GOVERNED BY LAWS OF THE STATE OF NEW YORK AND THE 2007 REVISION OF THE UNIFORM CUSTOMS AND PRACTICE FOR DOCUMENTARY CREDITS OF THE INTERNATIONAL CHAMBER OF COMMERCE
(PUBLICATION NO. 600). IN THE EVENT OF ANY CONFLICT, THE LAWS OF THE STATE OF NEW YORK WILL CONTROL. 
 SHOULD YOU HAVE OCCASION TO COMMUNICATE WITH US
REGARDING THIS CREDIT, KINDLY DIRECT YOUR COMMUNICATIONS TO THE ATTENTION OF OUR LETTER OF CREDIT DEPARTMENT
                            , MAKING SPECIFIC REFERENCE TO OUR LETTER OF CREDIT
NO.                            . 
  

 23 

 EXHIBIT 8 
 List of Buyer’s Facilities 
  

					
	 Site Name
	  	 Mailing Address
	  	 Physical Address

	Big Brown SES	  	PO Box 948, Fairfield, TX 75840	  	TXU Generation, 11 Mi NE of Fairfield, Fairfield, TX 75840 (FM 488 to FM 2570)
			
	Martin Lake SES	  	8850 FM 2658 North, Tatum, TX 75691	  	 TXU Generation, Off Hwy 43 & FM 2658, Dirgin
 (Tatum), TX 75691

			
	Monticello SES	  	PO Box 1266, Mt Pleasant, TX 75456-1266	  	TXU Generation, 9 Mi SW of Mt Pleasant off FM 127, Mount Pleasant, TX 75455
			
	Sandow SES	  	PO Box 1111, Rockdale, TX 76567	  	TXU Generation TXU Power, Rockdale, TX 76567 (from Rockdale, Hwy 77 West, left on Hwy 1786 to plant)
			
	Oak Grove	  	PO Box 558, Franklin, TX 77856	  	8127 Oak Grove Road, Franklin, TX 77856, 13 miles North of Franklin off FM 979

  

 24 

 EXHIBIT 9 
 Early Termination Schedule 
  

				
	 Termination
	  	Maximum Damage Amount
	 On or prior to September 30, 2008
	  	$	*
	 After September 30, 2008 but on or prior to January 30, 2009
	  	$	1,000,000
	 After January 30, 2009 but on or prior to commencement of delivery of Carbon from Seller’s Facility in accordance with this
Agreement
	  	$	10,000,000

  

 1

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