Common use of Compressed Air Clause in Contracts

Compressed Air. (a) The Mill Owner shall supply all of Ingevity’s requirements of compressed air for the Carbon Plant in accordance with the Services Specifications, as available from the Mill and consistent with the practice prior to the Effective Date. (b) For compressed air supplied by the Mill pursuant to Section 3.4(a), Ingevity shall pay to the Mill Owner on a monthly basis an amount determined by multiplying Ingevity’s metered usage of compressed air supplied by the Mill Owner by an industry average cost per 1,000 cubic feet of compressed air, as determined annually by the Operating Council. As of the Effective Date, the agreed upon industry average cost of compressed air is $0.25/1,000 cubic feet. Notwithstanding the foregoing, if in the future the Mill Owner separately tracks its Operating Costs to generate compressed air for the Mill and the Carbon Plant, the monthly amount payable by Ingevity for compressed air supplied by the Mill Owner pursuant to Section 3.4(a) shall be calculated by multiplying such Operating Costs for the month by a fraction, the numerator of which is the metered number of cubic feet of compressed air used by the Carbon Plant during the month and the denominator of which is the total number of cubic feet of compressed air used by the Carbon Plant and the Mill during the month.