MEM l?il? UM 0F UNDERSTANDENEI 'l?his emorand um ot? Understanding dated and effective September 2017i is between the VIRGENHA OFFICE, a Division ofthc West Virginia Department of Commerce, located at State Capitol Complex, Building 3, Suite 600: Charleston. WV 25305 and RUXUL USA lac. with headquarters loeated at 4504 C?ayce Rd, Byhalia, MS 386M WVDO and. Roxul are eaeh a ?Party? and are collectively the ?Parties." RECETALS Rosa] is considering numerous locations in the Eastern United States on which to develop construct, equip. and operate a new manufacturing facility to support its North American operations (the WHEREAS: Roxul has identi?ed the Jefferson Orchards site in in Ransom, West Virginia, as its preferred site to loeate and develop the Facility (the ?West Virginia Site?). A copy of a map depicting the West Virginia Site is attached to this MOU as Exhibit l; WHEREAS, 1&0qu has represented to the. WVDO that a ?nal investment decision to construct and operate the Facility at the West Virginia Site will require a commitment to expend approximately 3315050001)th (USD), and employ approximately 140 lull-lime equivalent employees (?Final investment Decision?); WHEREAS, the state of West Virginia has identi?ed Certain economic development assistance it will make available to Roxul if Roxul makes and fully implements the Final investment Decisions all suhjeet to the terms and conditions described in this MO and WHEREAS. the Parties desire to execute this MOU to clarify their respective representations, requirements, and commitments to Meditate the Final investment Decision by Roxul. NOW in consideration oi" the mutual promises contained herein, the investment by Rosul, and the economic assistance provided by the WVDQ the Parties hereby agree as follows: 1. Commitment of the Pa rtics. The will provide, or lacilita'te the provision oi", the economic development assistance described in this MOU to Roxnl, and Roxul will satisl?}r the Project 'l'ln?esholds described in this MOU. 2.. Project Thresholds. or before the Full Operation l'Date, as hereinafter delined, Ros ul will: Memorandum of Understanding Roxul USA, Inc. September 7, 2017 a. Employ approximately 140, and in no event less than 120, full-time equivalent employees at the Facility who cant an average annual salary or wage of $46,000 excluding paid bene?ts not subject, to West Virginia income taxes (the ?Employment Threshold?); Document that Roxul has caused the expenditure of approximately $150,000,000 (USD) or more to expand, construct, equip, and operate the Facility. 3. De?nitions. a. ?Full?time equivalent employee? means a direct employee who receives paid bene?ts and works at least 140 hours per month; or, for part-time work, an employee who receives paid bene?ts and works at least 20 hours per week for at least six consecutive or non-consecutive months per year. The term ?full-time equivalent employee? does not mean independent contractors who work for Roxul at the West Virginia Site. b. ?Independent contractor? means any natural person or business entity that provides goods or services to another person or entity in accordance with terms speci?ed in a contract or other agreement and who is subject to the control of any other party to such contracts or agreements only as to results. An independent contractor is independently licensed to do business in West Virginia, has an independent proprietary interest in its business operations, has an independent opportunity for pro?t or loss because of the provision of goods or services pursuant to such contracts or agreement, independently invests in the facilities by which its goods or services are provided, directs and controls the details of work and operations performed, regarding hours of work, and the order, sequence and manner in which work is completed for the provision of goods and services in ful?llment of such contracts or agreement, or supplies the tools, equipment and materials used to ful?ll the requirements of such contracts or agreements. Independent contractor does not include any natural person or entity that has any employees in common with any other party to such contracts or agreements. For purposes of this provision, the status of any person or entity as an ?employee? shall be determined in accordance with United States Internal Revenue Code section 3121, such that the person or entity does not have common ownership, common control, common operation or common management with any other party to such contracts or agreements. For purposes of this provision, "common ownership, common control, common operation or common management" means that two or more business entities are owned, controlled, operated or managed by the same person or group of persons. 2ofll Memorandum of Understanding Roxul USA, Inc. September 7, 2017 4. Ownership includes, but is not limited to ownership as determined, in accordance with the attribution and stock ownership rules of Internal Revenue Code section 267 or Internal Revenue Code section 318 or both, as applicable, and the rules and regulations pertinent thereto. Applicability of any Internal Revenue Service requirement or rule regarding the issuance or receipt of an Internal Revenue Service Form 1099 with relation to any payment or transaction consummated under any such contract or agreement is not determinative of independent contractor status for purposes of this provision. Construction Date and Full Operation Date. Roxul anticipates that it will adhere to the following schedule for commencement of construction activities and operations at the West Virginia Site: 5. Construction of the Facility will begin within 90 days of receipt of acceptable Prevention of Signi?cant Deterioration air permit from the West Virginia Department of Environmental Protection (WVDEP), or the following May 13:, whichever is later. Full Operation of the Facility will occur five years from the issuance of the certi?cate of occupancy or June 15?, 2024, whichever is sooner (the ?Full Operation Date?). Performance?Based li?orgivable Loan. The State of West Virginia will issue a forgivable loan to Roxul in the principal amount of $2,200,000.00 (USD), The forgiveness of the loan will be subject to Roxul meeting or exceeding the Employment Threshold set forth in paragraph 2 a of this MOU (the ?Forgivable Loan?). The Forgivable Loan will be subject the following general terms: The WVDO will facilitate the Forgivable Loan in coordination with the West Virginia Economic Development Authority, the local economic development authority, and/or the West Virginia Infrastructure and Jobs Development Council (the ?Lending Authority?). WVDO and Roxul will mutually agree on a draw schedule. No draw will be available until receipt of an acceptable PSD air permit. The full-amount of the loan may be drawn upon receipt ofthc PSD air permit and, the earlier of, construction or 90 days ofreceipt of PSD air permit. 3 of 11 Memorandum of Understanding Roxut USA, Inc. September 2017 Roxul may cause the proceeds of the Forgivable Loan to be used to purchase or lease land, building, or equipment, or any combination thereof, to complete the Facility (the ?Facility Assets?). d. Roxul will grant the Lending Authority at least a second priority security interest in and lien upon the Facility Assets or such portion thereof necessary as collateral to secure the Forgivable Loan. 6. Roxul will not be obligated to make any payment on the Forgivable Loan prior to the Full Operation Date. f. If Roxul meets or exceeds the Employment Threshold at or before the Full Operation Date, the Lending Authority will forgive the Forgivable Loan in its entirety at that time. g. If Roxul fails to meet or exceed the Employment Threshold at or before the Full Operational Date, Roxu] will repay the Forgivable Loan to the Lending Authority on a pro rata basis (the ?Prorated Repayment?). The Prorated Repayment is equal to the proportion that new Full Time Equivalent jobs at the Facility failing to meet the Employment Threshold bears to the Forgivable Loan. For example, if Roxul directly employs only 100 new employees at the Facility on the Full Operation Date, the calculation would be: (1 2,000,000 $333,333.33 (Prorated Repayment) 6. Sewer Service. The WVDO, or a related state agency, will provide suf?cient funding to the City of Ranson, West Virginia to provide adequate sewer service to the property line of the West Virginia Site, at no cost to Roxui. A copy of the letter to the City of Ranson demonstrating this commitment and the MOU between the State of West Virginia and City of Ransom are attached in this MOU as Exhibit 2. Roxul will provide notice to the City of Ranson and the State of West Virginia as to the progress of the PSD air permit by September 9.017. 7. Water Service. he WVDO, a related state agency, and/or the Jefferson County Economic Development Authority will provide sufficient funding to Jefferson Utilities Corporation (?Jefferson Utilities?) to provide adequate water service to the property line of the West Virginia Site, at no cost to Roxul. A cepy of the letter to the Jefferson Utilities demonstrating this commitment and the MOU between the State of West Virginia and Jefferson Utilities are attached in this MOU as Exhibit 3. Roxul will provide notice to the Jefferson Utilities and the State of West Virginia as to the progress of the PSD air permit by September 20W. 401C211 Memorandum of Understanding Roxu! USA, Inc. September 7, 2017 8. Extension of Additional Utilities. The WVDO is aware of commitments on behalf of certain utility providers, including First Energy (electric transmission service), Mountaineer Gas (natural gas service), and Frontier Communications (telecommunications service) to extend additional utilities reasonably necessary to service the West Virginia Site. The WVDO will work with Roxul and these providers, as necessary and if appropriate, to ensure that these additional utilities are extended to the West Virginia Site. A copy of letters from these utility providers demonstrating their commitment to extend these utilities to the West Virginia Site is attached to this MOU as Exhibit 4. 9. PILOT Agreement. The WVDO will support the Jefferson County Economic Development. Authority, the West Virginia Economic Development Authority, and/or any other community entity, including the Jefferson County Commission, Jefferson County School Board, or the Jefferson County Assessor, as necessary and if appropriate, to facilitate the Payment in Lieu of Tax Agreement acceptable to ROXUI and Jefferson County, West Virginia. A copy of the PILOT Agreement attached to this MOU as Exhibit 5. 10. Ingress and Egress. The West Virginia Department of Transportation, Division of Highways will administer the design, construction, and necessary funding to address reasonable access modi?cations along the State Highway System to provide ingress and egress to the West Virginia Site. A copy of the letter to Secretary Thrasher specifying this commitment: is attached to this MOU as Exhibit 6. 11. Workforce Training. The Governor?s Guaranteed Wort; Force Program offers training grants up to $2,000 per employee for eligible companies that create a minimum of 0 new jobs within a l2-1uonth period. If Roxul makes the Final Investment Decision, the WVDO will provide Roxul with a $2,000 workforce training grant under the GGWP for each new employee it hires and employs at the West Virginia Site during the first three consecutive years the Facility is operational at the West Virginia Site. These flexible training grants may be used by Roxul to offset the cost of employee recruitment, pre~e1nployment assessment, workplace development, structured 011~tlre?job training and development, expenses for traveling tor'from training, trainer salaries, cost of trainers, training materials and/or workplace education. Roxui would qualify for $240,000 in any one year based on 120 jobs and could qualify for more than $240,000 based on any additional employment over 120 employees under the GGWP. For purposes of this paragraph, the term ?year? means the state of West Virginia?s ?scal year which begins on July 1 and ends on June 30. 12. Tax Benefits. Based on the mutual covenants, promises, and agreements described in this MOU, Roxul will qualify for various tax credits, entitlements, exemptions, and assistance Sofll Memorandum of Understanding Roxul USA, Inc. September 7, 2017 under West Virginia law (including, statutory sales tax exemptions for the purchase of tangible personal property and services directly used in manufacturing, which shall extend to purchases of building materials and process equipment by Roxul?s suppliers and contractors and other parties purchasing on behalfofRoxul in furtherance of the construction of the Facility at the West Virginia Site). The direct. use in manufacturing exemption shall also be available to Roxul for purchases of tangible personal property and services directly used in manufacturing, including, but not limited to, purchases of raw materials and process equipment directly used in manufacturing. The WVDO will work with Roxul to facilitate the Company?s understanding and access to these benefits and incentives. A copy ofthe West Virginia Tax Departments forms TSD 10 and TSD 300 explaining tax credits and exemptions is attached to this MOU as Exhibit l3. 5 for 10. Provided ROXUL can meet all statutory conditions of WV Code ll?GF- 1 et. seq, the WVDO Shall cooperatively work with ROXUL to help ROXUL access all the bene?ts associated with this statutory incentive. 14. Contingencies. The Final investment Decision is made expressly contingent upon the occurrence of the following conditions precedent (?Project Contingencies?), the failure of any of which will entitle Roxul to unilaterally terminate this MOU without any penalty or obligation: a. Site Acquisition: Roxul shall close on the West Virginia Site no later than January 15, 2018 (?Site Closing?) and upon terms and conditions acceptable to Roxul, including, but not limited to, Roxul being able to obtain acceptablerepresentations, Warranties, covenants, indemnities, and title for the West Virginia Site and contingent upon the completion of the subdivision and rezoning of the parcel by the seller; b. Zoningand Land Use: Roxul, or designated third party, shall obtain and secure all lot changes, zoning changes, deed restrictions, permits, including PSD air permits, and/or any other land use approvals necessary to use and operate the Facility at the West Virginia Site in accordance with its intended plans; 0. Voluntary Remediation Program: The West Virginia Site shall be eligible to participate in the West Virginia Voluntary Remediation Program (the ?Remediation Program?) and obtain or receive a Certificate of Completion under the Remediation Program from the WVDEP that provides Roxu] acceptable immunity from liability as determined by Roxul in its sole discretion; ?otll Memorandum of Understanding Roxul USA, Inc. September 7, 2017 d. Board Approval. Roxul shall obtain and secure necessary approval from its Board of Directors to make the Final Investment Decision to construct and operate the Facility at the West Virginia Site within 180 days of fully executing this e. Third Party_Commitments. Roxul shall negotiate independent agreements and/or memorandums of understanding with the city of Ranson and the County of Jefferson acceptable to Roxul prior to the Site Closing. 15. Binding Commitment. The obligations and covenants set forth in this MOU are intended to be binding subject to the occurrence of the conditions that Roxul expends approximately $150,000,00000 (USD) to acquire, construct, equip, and operate the Facility at the West Virginia Site, and (ii) Einploys approximately 140, and in no event less than 120, fullutime equivalent employees at the Facility and administers a payroll of at least $6,700,000, inclusive of bene?ts per year for a minimum of three (3) years (which may or may not be consecutive years), with the ?rst year of meeting such threshold being within ?ve (5) years of the start of production at the Facility as that term is de?ned in the Facility?s PSD air permit. 16. Irrevoeable. This MOU, until accepted and executed by Roxul, shall constitute an offer by the WVDO, which shall remain open for a period of ninety (90) days from the effective date hereof. Upon acceptance and execution by the Roxnl, this MOU shall become a legally enforceable contract. 17. Access to Data. Upon request, Roxul will provide the WVDO with access to certain data necessary to reasonably verify the level of investment and economic impact of the Facility. Such data shall include without limitation, as applicable, relevant West Virginia business tax information; total capital investment in real property, personal property, materials, equipment, and/ or machinery; total capital lease costs or costs to lease a new building; total construction costs; levels of direct employment of new or saved employees or non-qualifying employees; average salaries or wages; base salaries or wages; total construction employment of full?time equivalent employees and related salary or wage data; and any-indirect employment data related to or associated with the Facility. 18. Notice. All notices which are permitted or required in this MOU shall be in writing and deemed valid and received if delivered personally; by registered or certi?ed mail, return receipt requested; or by special canier (such as Federal Express or UPS), with signature required, to the WVDO or Roxul as follows, unless otherwise agreed by the Parties in a signed writing: 7ofll Memorandum of Understanding Roxul USA, Inc. September 7, 2017 To WVDO: West Virginia Development Of?ce Attn: Director of Business and Industrial Development 1900 Kanavvha Blvd. East Capitol Complex, Building 3, Suite 600 Charleston, WV 25305 To Roxul: Roxul USA, inc. Attn: Ken Cammarato Vice President, General Counsel Roxul USA Inc. 4594 Cayce Rd. Byhalia, MS 38611 19. Further Assurances. Each of the Parties hereto shall, from time to time at the request of the other party, without any additional consideration, ?n'nish the other Party such further information or assurances, execute and deliver such additional documents, instruments and conveyances, and take such other actions and do such other things, as may be reasonably necessary in the opinion of counsel to the requesting party to carry out the provisions of this MOU. 20. Confidentiality. The Parties will maintain all documentations and communications provided to the other Party related to this project to construct the Facility and/or verifying the economic impact of the Facility at the West Virginia Site, as con?dential, subject to the laws of the state of West Virginia, as applicable. The Parties will mark, or otherwise indicate in writing to the other Party, any documents or communications deemed con?dential or prOprietary, Authority. The WVDO represents and warrants that the WVDO is the proper agency or instinincntality of the State of West Virginia to commit the economic development assistance set foith herein, and that the Director of WVDO is vested with the full legal authority and is duly authorized to execute this MOU on behalf of the WVDO and the State ot?West Virginia. 22. Amendments or Modifications. This MOU may only be amended or modi?ed by a signed writing executed by authorized representatives of the Parties. 23. Severability. If any provision of this MOU shall for any reason he held illegal, invalid or unenforceable, then the other provisions of this MOU shall not be rendered invalid or 801?11 Memorandum of Understanding Roxul USA, inc. September 7, 2017 otherwise affected thereby, and shall continue in full force and effect to the maximum extent permitted by applicable law. 24. Subcontracting. Neither Party may assign or subcontract any of its obligations or duties under this MOU, without the prior written consent of the other Party, which consent shall be in the sole determination of the Party with the right to consent. 25. Assignment. No party shall have the right to assign this Agreement or any portion hereof, or any of its respective rights or obligations hereunder, without the prior written consent of the other party; provided however, that Roxul shall be permitted to assign this Agreement or any portion hereof, or any of its rights or obligations hereunder, to any affiliate of Roxul without the prior consent of the WVDO, however, Roxul will still remain ultimately responsible and liable for the performance of any such assignee?s obligations hereunder. 26. Force Majeure. Neither Party shall be responsible for any delay or failure in performance of any part of this MOU if such delay or failure is caused by ?re, flood, explosion, war, act of terror, embargo, national economic crisis, government requirement, civil or military authority, act of God, or other similar causes beyond its control and without the fault or negligence of the delayed or non?performing Party. The affected Party will notify the other Party in writing within ten (10) days after the beginning of any such Force Majeure event. Notwithstanding, if a Party?s performance is delayed fora period exceedin thirty (3 0) days from the date the other Party receives notice under this paragraph, the non?affected party may, without any liability to the other Party, terminate this provided, however, that Roxul will repay the Forgivablc Loan described in paragraph 5, or such portion thereof that fairly and equitably re?ects the difference between the draw on the Forgivable Loan and Roxul?s actual investment in the Facility, if Roxul terminates the MOU pursuant to a Force Maj cure event covered by this provision. Further, if Roxul provides notice of a Force Majeure event which results in a delay of the performance of its obligations set forth in paragraph 5, Roxul?s performance obligations shall be extended by the period of the Force Majeure delay up to an extension of one (1) year. 27. Available Workforce. The State acknowledges that the workforce available to Roxul in the State, County, and surrounding vicinity is a critical reason for Roxul?s decision to locate at the West Virginia Site. Should Roxul be able to demonstrate that its ability to recruit a competitive workforce has been adversely impacted by the WVDO providing more advantageous terms, conditions, or economic incentives than those provided to the Company within five (5) years from the execution of this MOU, then the WVDO agrees to work in good faith with Roxul to determine if same, or similar, terms, conditions, or economic incentives may also be available to Company; provided, however, that this clause is not intended to interfere with the ability to enhance economic Opportunities on behalfof the state of West Virginia; provided, that 90t11 . Memorandum of Understanding Roxul USA, Inc. September 7, 2017 the WVDO shall have the ability, in its sole discretion, to determine whether the disclosure of such terms, conditions, or economic incentives is possible and/or appropriate or permitted under West Virginia law or the terms of an applicable non?disclosure agreement, if any; and provided, further, that the WVDO shall be under no obligation to advise Rox ul of any development prospects and/or projects that may be engaged with the WVDO to investigate investment opportunities in West Virginia. 28. Ombudsman. The dedicated point?of?contact for the Parties to ensure that the obligations set forth in this MOU are implemented, documented, and achieved are as follows: a. WVDO: Todd Hooker, Deputy Director gov (3 04) 5 58?2234 b. Roxul: Ken Cammarato, Vice President, General Counsel ken.cammaratoQDroxul.com (662) 851?4734 If Todd Hooker is unable to serve in this position, Roxul will have the right to participate in a mutually agreed upon selection of who replaces Todd Hooker as Ombudsman to Roxul. 29. Press Releases. Neither party shall issue any press releases or make public ainiouncements relating to this Agreement without the other party?s prior written approval, which approval shall not be unreasonably withheld, conditioned or delayed; provided, however, that nothing in this Section shall impair either party?s compliance with law or regulation generally or with any requirements of the Securities and Exchange Commission or of any national securities exchange or other stock market on which such party?s securities are traded. 30. Future Expansion. If at any time Roxnl anticipates a substantial expansion of its operations in the State of West Virginia beyond the scope currently planned for the Facility, and has met or exceeded the Project Thresholds described above, the State will review such expansion plans with the intent to provide additional economic development incentives to Roxul but shall not have an obligation to provide any incentives to Roxnl with respect to such expansion. Governing Law. This MOU shall be governed by the laws of the State of West Virginia. 10 of 11 Memorandum of Understanding Rmtul USA, inc. September 7, 2017 The Parties Sign: ROWE Haw. r" 47% A Trent (J 5i Me- ITS: Presin'ient Dam: 11 of Wes?? Virginia Deve?opmem? Office . .V BY: A NAME: Kristopher 1--lnpkins ITS: Executive Director Date: