APPLICATION FOR PARTICIPATION IN A SOIL CARBON POOL

FROM CONTINUOUS CONSERVATION TILLAGE, HAY OR LONG-TERM

GRASS PLANTINGS, AND SALES CONTRACT FOR CARBON CREDITS

I, Your Name (Project Owner), hereby apply for participation in a soil carbon pool known as Sample managed by North Dakota Farmers Union to register Carbon Credits (also referred to as “Carbon Offset(s)” or “Offsets”) with the Chicago Climate Exchange (CCX) for the calendar years N/A through N/A , plus additional years preceding this period, as allowed by CCX protocols, as applicable, and hereafter referred to as the "contracted period," on property that I own or control. I hereby agree that XXX.X acres shall be in Continuous Conservation Tillage, Hay or Long-Term Grass Plantings as defined in this Agreement. I further agree that I will abide by the rules of the CCX as they pertain to Carbon Credits and to the conditions for pool participation as set forth in this Agreement.

Project Owner agrees to sell and deliver to North Dakota Farmers Union free from liens and encumbrances at 1415 12th Avenue SE, Jamestown, North Dakota 58401, the rights to the Carbon Credits created during the contracted period through the application of Continuous Conservation Tillage, Hay or Long-Term Grass Plantings to XXX.X acres as entered into the Farmers Union Carbon Credit Program database.

Carbon Credits will accrue for the enrolled land at the applicable rate for the eligible practice and Land Resource Region, as defined by the CCX.  20% of the accrued carbon credits shall be held in reserve by the Chicago Climate Exchange until December 31,  N/A.   Project Owner warrants that the Carbon Credits covered by this contract comply with all rules of the Chicago Climate Exchange. In particular, Project Owner warrants that the land from which the carbon credits covered by this contract arise shall be in Continuous Conservation Tillage, Hay or Long-Term Grass Plantings during the contracted period.

North Dakota Farmers Union (Aggregator) will manage the database of all enrollment contracts and supporting documents for the duration of the contract.  The aggregator will assemble these enrollments into large pools of similar projects, will arrange for third party verification of enrolled projects according to CCX protocols, make the appropriate adjustments to the pool accounting and reserve pools, register the verified pools of projects on the CCX registry, market the offsets, and pay project owners as each pool of offsets is sold.

In the event that the practice fails to meet these requirements, all Carbon Credits from such acreage shall be null and void and any payments for credits delivered on or prior to December 31, N/A  shall be repaid subject to interest and penalties as provided in this agreement.  Sale of credits covered by this contract shall be at the sole discretion of the North Dakota Farmers Union, however, all Carbon Credits earned and registered under this agreement shall be sold within six months of the termination of this Agreement.  Neither CCX nor North Dakota Farmers Union makes any warranty as to the marketability or market value of Carbon Credits.  North Dakota Farmers Union may sell or retain Carbon Credits in its Registry Account for the duration of the contract period.  The transfer price of the Carbon Credits covered by this contract shall be the net sales price as determined by sale through the Chicago Climate Exchange, less a 10% service fee. Carbon Offset registration and sales fees and Offset verification costs are the responsibility of the Offset project owner, and will be deducted from pool proceeds prior to payment calculations.  By signature hereto, Project Owner irrevocably conveys title to the Carbon Credits as stated above during the contracted period. Project Owner further warrants compliance with the terms and conditions contained in the Agreement for the contracted period.

TERMS AND CONDITIONS

By executing this APPLICATION FOR PARTICIPATION IN A SOIL CARBON POOL FROM Continuous Conservation Tillage, Hay or Long-Term Grass Plantings AND SALES CONTRACT for CARBON CREDITS, Project Owner understands and agrees to the following Terms and Conditions:

1. To generate Offsets, Project adheres to “Chicago Climate Exchange Offset Project Protocol – Agricultural Best Management Practices-Continuous Conservation Tillage and Conversion to Grassland Soil Carbon Sequestration Offset Projects" (“Protocol”) (last updated 09/30/2009 and available at www.chicagoclimatex.com) for the duration of this Agreement.
2. Project Owner will be held liable for repayment of all funds advanced, the loss of any reserve tons earned, and payment for all Carbon Credit registration fees, pool verification costs, aggregation costs, collection costs, interest and reasonable attorney’s fees, should the project fail to adhere to specified Protocol.
3. Project Owner shall retain full legal ownership of all greenhouse gas mitigation rights that may accrue: (a) on lands or via activities not included in the CCX-registered project; (b) in excess of the quantity of carbon credits issued by CCX to CCX-registered projects; (c) before or after the contracted period for the CCX- registered project.
4. Project Owner declares that Project Owner has ownership or operational control of the land enrolled. Where land is leased, the lessee shall sign the declaration indicating that they have operational control and the practices specified by the Protocol are not a lease condition.
5. Project Owner declares that the Carbon Credits covered under this agreement are exclusively being sold through North Dakota Farmers Union on CCX (i.e., they are not being sold through another registry, program, or through another Aggregator on CCX, or other).
6. Project Owner attests that the actions of Continuous Conservation Tillage, Hay or Long-Term Grass Plantings are not undertaken under any federal, state or local regulations or other legally binding or enforceable agreement.
7. Project Owner attests that the actions undertaken under this Agreement will not result in new or changed activities outside the Project Boundary that actually increase GHG emissions. This concept is commonly referred to as leakage.
8. Project Owner declares that they have an entity-wide annual GHG emissions profile of less than 10,000 metric tons CO2 equivalent.  Entities with an entity-wide emissions profile greater than 10,000 metric tons CO2 equivalent for the most recent calendar year may register and trade CCX Exchange Offsets only if the entity is a Member of CCX and undertakes the CCX Emission Reduction Commitment.
9. Project Owner is required to complete enrollments through NDFU's on-line database enrollment system utilizing a map-based interface.  Contact information required includes a valid and accessible e-mail address for contract communications.  The enrolled acres are valid and considered a part of the database for the entire contract period.  Contract holder understands that most contract communications will be done using e-mail.
10. Between July 1st and September 30th of each year, Project Owner is required to re-certify using the on-line system to confirm contract compliance.  Failure to annually re-certify the contract by September 30th of each year, or falsification of reports, will be considered to be non-compliance with terms of this contract, and Project Owner will be held liable for repayment of all funds advanced, the loss of any reserve tons earned, and payment for all Carbon Credit registration and sales fees, pool verification costs, aggregation costs, collection costs, interest and reasonable attorney’s fees.
11. In the event the CCX ceases to accept carbon credits for the registration, and an acceptable alternative cannot be found,  in any given year during the term of this Agreement, both Project Owner and North Dakota Farmers Union shall be relieved of any duties or obligations as provided under this Agreement for the year which is not able to be registered and all years remaining under the terms of this Agreement.
12. In the event that a transfer of operational control of contracted acreage occurs during the contracted period, a sub-contract may be created. Subcontracts are designated with an "S" following the two-letter state code in the Contract Number. All of the Terms and Conditions of the original Agreement shall apply to the sub-contract. Responsibility for obtaining a subcontract falls on the original Project Owner. In the even that a subcontract cannot be obtained within 90 days of the transfer of operational control, the acres shall be considered non-compliant, and the original Project Owner shall pay back all credits and fees (as detailed in item #10 above) that are found to be noncompliant. Carbon Credits earned and held in escrow, as well as penalties for non-compliance caused by the actions of the sub-contract holder shall remain the responsibility of the original Project Owner for the contract period prior to January 1 of the year in which the transfer occurred.
13. The commitments and obligations of the Project Owner that are created by this contract shall terminate at midnight on December 31,N/A.
14. Failure to conform to the provisions established herein may result in termination of enrollment in CCX and prohibition from all further participation in CCX.