Terms and Conditions

This document is intended to define the terms of sale and payment that shall apply to all purchase orders issued by the Customer to Advanced Powder Dynamics, (“Company”). It is therefore agreed as follows:

1. Scope of Agreement

This agreement applies to all purchase orders given by Customer to Company and to all sales by Company to Customer. By submitting a purchase order to Company, Customer agrees to the terms. If there is any conflict between the terms of the Agreement and the terms of a purchase order or any other sales document, then this Agreement shall control as to such conflicting terms unless such other sales document is signed both by Customer and by Company.

2. Purchase Orders

To order Goods, Customer will issue to Company a Purchase Order in written form via e-mail or other method reasonably acceptable to Company. By issuing a Purchase Order to Company, Customer makes an offer to purchase Goods pursuant to the terms and conditions of this Agreement, and on no other terms. For the avoidance of doubt, any variations made to the terms and conditions of this Agreement by Customer in any Purchase Order are void and have no effect.

3. Cancellation of Purchase Orders

A Purchase Order is only binding on Company upon Company’s written acceptance thereof (which may be via email). Company may reject a Purchase Order or cancel a previously accepted Purchase Order, which it may do without liability or penalty, and without constituting a waiver of any of Company’s rights or remedies under this Agreement or any Purchase Order, by providing written notice to Customer, including, for example, if Company cannot source the materials that meet the Customer’s requirements. Customer shall be entitled to cancel a purchase order by giving written notice that is received by Company within three (3) business days after Company has received such purchase order and Customer will be required to take delivery of and pay for all purchase orders that Company has received, unless otherwise agreed upon by both parties. Cancellation of rush orders is not permitted.

4. Change of Purchase Orders

Changes are not permitted after three (3) business days from submission of the purchase order. Any change after receipt may extend the original completion date. Changes to signed formulation specifications require a mutually agreed change order and signed revision sheet.

5. Delays Caused by Customer Supplied Materials

In the event product shipments are delayed due to unavailable materials provided by the Customer, Company reserves the right to reschedule production. Company requires all materials to be received within three weeks of the scheduled production start date to allow ample time for product testing to be completed.

6. Delays Caused by Company Supplied Materials

In the event product shipments are delayed due to unavailable materials provided by the Company, Company reserves the right to reschedule production. Company will notify the Customer of the situation prior to the requested completion date.

7. Outgoing (Finished Good) Shipment and Delivery

Unless otherwise expressly agreed by the Parties in writing, Customer will arrange transportation for the Goods. Company may, in its sole discretion, without liability or penalty, make partial shipments of Goods to Customer. Each shipment will constitute a separate sale and Customer will pay for the Goods prior to shipping, in accordance with the payment terms specified Terms & Conditions, whether such shipment is in whole or partial fulfillment of a Purchase Order. Unless otherwise expressly agreed by the Parties in writing, Company will deliver the Goods to the delivery location set forth in the Purchase Order, using Company’s standard methods for packaging and shipping such Goods. All Goods are FOB Origin (Incoterms 2010). Title and risk of loss to Goods shipped under any Purchase Order passes to Customer upon Company’s tender of such units to the carrier at Company’s facilities. Company will hold product for no more than ten (10) days business days. Completed inventory held by Company may incur a finance charge of one and one-half percent (1.5%) per month of the purchase order.

8. Payment Terms

For campaigns: 30% deposit at order placement, remaining 70% due prior to shipment (if all materials are customer supplied). If Company is to procure materials for the Customer, 50% deposit at order placement, remaining 50% due prior to shipment. For LSDEs and R&D D5 runs 100% payment upfront. Deposit is nonrefundable. Downpayment secures production slot.

9. Late Fees, Downpayments, and Production Scheduling

APD reserves the right to charge a late fee of 1.5% per month on overdue balances. Unresolved delinquent payments may result in credit hold and removal from production schedule.

10. No set-off

Customer will not, and acknowledges that it will have no right, under this Agreement, any Purchase Order, any other agreement, document or law to, withhold, offset, recoup or debit any amounts owed (or to become due and owing) to Company or any of its affiliates, whether under this Agreement or otherwise, against any other amount owed (or to become due and owing) to it by Company or Company’s Representatives, whether relating to Company’s or its Representatives’ breach or non-performance of this Agreement, any Purchase Order, any other agreement between (a) Customer or any of its Representatives, and (b) Company or any of its Representatives, or otherwise.

11. Unique Materials

If unique and/or specific ingredients or packaging components are required to complete Customer orders, Company reserves the right to request full payment for excess inventory if not used within one (1) quarters.

12. Taxes and Customs Duties

Customer is responsible for all taxes, duties, and customs charges.

13. Storage of Customer Supplied Materials

Inbound Materials. Company agrees to store customer-supplied raw materials and packaging for a reasonable time without charge, using prudent business practices. Extended storage may incur charges. Materials utilized within one (1) month of receipt will not incur storage charges. After one (1) month, storage will be billed at $100 per month per pallet.

Post-Production. All remaining raw materials must be returned at the conclusion of the production campaign unless otherwise agreed in writing. Following production, ten (10) business days of storage are provided at no charge. After three (3) months, the Company reserves the right to scrap the remaining raw materials. The Customer will be billed for disposal. The Company’s warehouse operates under ambient temperature/humidity conditions and may be subject to significant fluctuations. The Company shall not be liable for any loss, degradation, or damage to materials or products arising from or related to temperature or humidity exposure while stored in the Company’s facility.

14. Delays Caused by Shipment Instruction Changes

Company will ship to the address on the Purchase Order. Special arrangements must be provided with the PO. Changes may result in delays.

15. Export Controls

Customer shall comply with all applicable export control and sanctions laws.

16. Deposits and Credit Limits

Company reserves the right to request deposits for large orders or new customers and may establish credit limits to manage risk.

17. Minimum Order Requirements

Company reserves the right to set minimum order quantities or charge short-run fees for low-volume orders.

18. Order Fulfillments

Order fulfillment may vary by up to ±10%. Customer agrees to pay for actual shipped quantity.

19. Specifications

If Customer does not provide specifications with the PO, Company’s standard specifications will apply.

20. Forecasting

To ensure lead times, Company requests a rolling forecast for three quarters in advance.

21. Finished Good Quality Inspections

Customer will inspect Goods received under this Agreement immediately upon receipt of such Goods and either accept or, only if any such Goods are damaged or do not conform to applicable specifications, reject such Goods. Customer will be deemed to have accepted Goods unless it provides Company with written notice of any damaged or noncompliant Goods within 15 business days following delivery to Customer of the Goods, stating with specificity all defects. If Customer timely notifies Company of any damaged or noncompliant Goods, Company will determine, in its reasonable discretion, whether the Goods are damaged or noncompliant Goods. If Company determines that such Goods are damaged or noncompliant Goods, Company will, in its solediscretion, either:

(a) replace or rework such damaged or noncompliant Goods with non-damaged or compliant Goods; or

(b) refund to Customer such amount paid by Customer to Company for such non-conforming Goods returned by Customer to Company.

Except as provided under this paragraph, Customer has no right to return Goods shipped to Company pursuant to this Agreement. The remedies set forth in this section are customer’s exclusive remedy for the delivery of nonconforming goods.

22. Intellectual Property

Company retains all rights in its manufacturing processes, methods, and know-how. No license is granted unless expressly agreed.

23. Confidentiality

Both parties agree to maintain confidentiality of all non-public information disclosed during the campaign.

24. Representations and Warranties

Each Party represents and warrants to the other Party that:

(a) it is duly organized, validly existing and in good standing under the laws of the state of its formation, and it has the full right, power and authority to enter into this Agreement and to perform its obligations hereunder;

(b) the execution, delivery and performance of this Agreement by such Party will not violate, conflict with, require consent under or result in any breach or default under any applicable law or, with or without notice or lapse of time or both, the provisions of any agreement such Party or its Representatives may have with any third Person; and

(c) this Agreement has been executed and delivered by such Party and (assuming due authorization, execution and delivery by the other Party) constitutes the legal, valid and binding obligation of such Party, enforceable against such Party in accordance with its terms.

Except as set forth in this section, neither company nor any person on company’s behalf has made or makes any express or implied representation or warranty whatsoever, either oral or written, including any warranties of merchantability, fitness for a particular purpose, title, or non-infringement, whether arising by law, course of dealing, course of performance, usage of trade or otherwise, all of which are expressly disclaimed, and customer acknowledges that it has not relied upon any representation or warranty made by company, or any other person on company’s behalf.

25. Force Majeure

Company will not be liable or responsible to Customer, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement, if such failure or delay is caused by or results from acts beyond Company’s control, including: (a) acts of nature; (b) flood, fire, earthquake or explosion; (c) war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; (d) requirements of law; (e) actions, embargoes or blockades in effect on or after the date of this Agreement; (f) action by any governmental authority (whether or not having the effect of law); (g) national or regional emergency; (h) strikes, labor stoppages or slowdowns or other industrial disturbances; (i) shortages of or delays in receiving raw materials; (j) shortage of adequate power or transportation facilities; or (k) pandemics, epidemics, public health emergencies, and any government-mandated restrictions.

26. Limitation of Liability

Disclaimer. in no event will company or its representatives be liable for consequential, indirect, incidental, special, exemplary, punitive or enhanced damages, lost profits or revenues or diminution in value, arising out of or relating to any breach of this agreement, regardless of (a) whether such damages were foreseeable, (b) whether or not customer was advised of the possibility of such damages and (c) the legal or equitable theory (contract, tort or otherwise) upon which the claim is based, and notwithstanding the failure of any agreed or other remedy of its essential purpose. Damage cap: in no event will company’s aggregate liability arising out of or related to this agreement, whether arising out of or related to breach of contract, tort (including negligence) or otherwise, exceed the total of the amounts paid to company pursuant to this agreement in the one-month period preceding the event giving rise to the claim.

Assumption of risk. Without limiting the generality of the foregoing, customer assumes all risk and liability for the results obtained by the use of any goods in the practice of any process, whether in terms of operating costs, general effectiveness, success or failure, and regardless of any oral or written statements made by company, by way of technical advice or otherwise, related to the use of the goods.

27. Insurance

Customer shall maintain insurance covering consigned materials and finished goods after title transfer.

28. Governing Law

This Agreement, including all exhibits, schedules, attachments and appendices attached hereto and thereto, and all matters arising out of or relating to this Agreement, are governed by, and construed in accordance with, the laws of the State of Arizona, United States of America, without regard to the conflict of law’s provisions thereof. The Parties agree that the United Nations Convention on Contracts for the International Sale of Goods does not apply to this Agreement.

29. Choice of Forum

Each Party irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding

of any kind whatsoever against the other Party in any way arising from or relating to this Agreement, including all exhibits, schedules, attachments and appendices attached hereto and thereto, and all contemplated transactions, including contract, equity, tort, fraud and statutory claims, in any forum other than the state and federal courts located in Gila County, Arizona. Each Party irrevocably and unconditionally submits to the exclusive jurisdiction of such courts and agrees to bring any such action, litigation or proceeding only in such courts. Each Party agrees that a final judgment in any such action, litigation or proceeding is conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

30. Miscellaneous

Entire Agreement: These Terms and applicable Quotes constitute the entire agreement.

Severability: Invalid provisions do not affect remaining terms.

Assignment: Customer may not assign without APD’s consent.

Notices: Formal notices must be in writing and delivered to the addresses specified in the Quote.