AMENDED AND RESTATED ETHANOL PURCHASE AND SALE AGREEMENT by and between FRONT RANGE ENERGY, LLC and KINERGY MARKETING, LLC Dated as of August 9, 2006
AMENDED
AND RESTATED
by
and between
FRONT
RANGE ENERGY, LLC
and
KINERGY
MARKETING, LLC
Dated
as of August 9, 2006
TABLE
OF CONTENTS
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ARTICLE
I DEFINITIONS; INTERPRETATION
|
1
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1.1
|
Definitions
|
1
|
|
1.2
|
Interpretation
|
4
|
|
ARTICLE
II MARKETING ACTIVITIES
|
5
|
|
|
2.1
|
Marketing
and Purchase of Ethanol
|
5
|
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2.2
|
Direct
Purchases
|
6
|
|
2.3
|
Bilateral
Transactions
|
6
|
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2.4
|
Storage
|
8
|
|
2.5
|
Obligations
of the Project Company
|
8
|
|
2.6
|
Title;
Delivery Point; Nominations; Measurement
|
9
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ARTICLE
III PAYMENTS
|
9
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|
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3.1
|
Fees
and Payments
|
9
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3.2
|
Overdue
Payments; Indemnity Payments
|
10
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3.3
|
Billing
Dispute
|
10
|
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3.4
|
Audit
|
10
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ARTICLE
IV TERM; TERMINATION
|
11
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4.1
|
Term.
|
11
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4.2
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Termination
by Kinergy
|
11
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|
4.3
|
Termination
by the Project Company
|
11
|
|
4.4
|
Change
of Control
|
12
|
|
4.5
|
Effect
of Termination
|
12
|
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ARTICLE
V LIMITATIONS ON LIABILITY
|
13
|
|
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5.1
|
Maximum
Liability of Kinergy
|
13
|
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5.2
|
No
Consequential or Punitive Damages
|
13
|
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ARTICLE
VI INDEMNIFICATION
|
13
|
|
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6.1
|
The
Project Company’s Indemnity
|
13
|
|
6.2
|
Kinergy’s
Indemnity
|
14
|
|
ARTICLE
VII REPRESENTATIONS AND WARRANTIES
|
14
|
|
|
7.1
|
Kinergy’s
Representations and Warranties
|
14
|
|
7.2
|
The
Project Company’s Representations and Warranties
|
15
|
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ARTICLE
VIII FORCE MAJEURE
|
16
|
|
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8.1
|
Definition
|
16
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8.2
|
Effect
|
16
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8.3
|
Limitations
|
16
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ARTICLE
IX DISPUTE RESOLUTION
|
17
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|
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9.1
|
Attempts
to Settle
|
17
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|
9.2
|
Resolution
by Expert
|
17
|
|
9.3
|
Arbitration
|
17
|
|
9.4
|
Consequential
and Punitive Damages
|
18
|
|
9.5
|
Finality
and Enforcement of Decision
|
18
|
|
9.6
|
Costs
|
18
|
|
9.7
|
Continuing
Performance Obligations
|
18
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ARTICLE
X CONFIDENTIALITY
|
18
|
|
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ARTICLE
XI ASSIGNMENT AND TRANSFER
|
19
|
|
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ARTICLE
XII FURTHER ASSURANCES; REQUESTS OF FINANCING PARTIES
|
19
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|
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12.1
|
Further
Assurances
|
19
|
|
12.2
|
Requests
of Financing Parties
|
19
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ARTICLE
XIII MISCELLANEOUS
|
19
|
|
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13.1
|
Amended
Agreement; Entire Agreement
|
19
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13.2
|
Counterparts
|
19
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13.3
|
Survival
|
20
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|
13.4
|
Severability
|
20
|
|
13.5
|
Governing
Law
|
20
|
|
13.6
|
Binding
Effect
|
20
|
|
13.7
|
Notices
|
20
|
|
13.8
|
Amendment
|
22
|
|
13.9
|
No
Implied Waiver
|
22
|
AMENDED
AND RESTATED
This
AMENDED AND RESTATED ETHANOL PURCHASE AND SALE AGREEMENT (“Amended
Agreement”)
is
entered into by and between FRONT
RANGE ENERGY, LLC,
a
Colorado limited liability company (the “Project
Company”),
and
KINERGY MARKETING, LLC, an Oregon limited liability company (“Kinergy”),
as of
this 9th day of August, 2006. The Project Company and Kinergy are each
individually referred to herein as a “Party”,
and
collectively are referred to herein as the “Parties”.
RECITALS
A. The
Project Company has completed the development of an approximately 40 million
gallon-per-year denatured fuel ethanol production facility in Windsor, Colorado
(the “Facility”).
B. On
July
31, the Parties entered into that certain Ethanol Marketing Agreement (the
“Agreement”)
pursuant to which Kinergy agreed to provide denatured fuel ethanol marketing
services for the Facility.
C. Subsequent
to the signing of the Agreement, and prior to the date on which the Facility
commenced operations, the Parties agreed upon certain modifications to their
business arrangements as represented by the Agreement, and agreed to amend
the
Agreement to conform to their new arrangements.
B. Kinergy
desires purchase and sell ethanol in accordance with and subject to the terms
and conditions of this Amended Agreement and has done so since prior to the
time
that the Facility commenced operations.
AGREEMENT
NOW,
THEREFORE, in
consideration of the agreements and covenants hereinafter set forth, and
intending to be legally bound, the Parties hereto covenant and agree as
follows:
ARTICLE
I
DEFINITIONS;
INTERPRETATION
1.1
Definitions.
The
following terms shall have the meanings set forth below when used in this
Amended Agreement:
1
“Account”
has
the
meaning given to such term in Section
2.1(d).
“Act
of
Insolvency”
means,
with respect to any Person, any of the following: (a) commencement by such
Person of a voluntary proceeding under any jurisdiction’s bankruptcy, insolvency
or reorganization law; (b) the filing of an involuntary proceeding against
such
Person under any jurisdiction’s bankruptcy, insolvency or reorganization law
which is not vacated within 60 days after such filing; (c) the admission by
such
Person of the material allegations of any petition filed against it in any
proceeding under any jurisdiction’s bankruptcy, insolvency or reorganization
law; (d) the adjudication of such Person as bankrupt or insolvent or the winding
up or dissolution of such Person; (e) the making by such Person of a general
assignment for the benefit of its creditors (assignments for a solvent financing
excluded); (f)
such
Person fails or admits in writing its inability to pay its debts generally
as
they become due; (g) the appointment of a receiver or an administrator for
all
or a substantial portion of such Person’s assets, which receiver or
administrator, if appointed without the consent of such Person, is not
discharged within 60 days after its appointment; or (h) the occurrence of any
event analogous to any of the foregoing with respect to such Person occurring
in
any jurisdiction.
“Affiliate”
means,
with respect to any Person, any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such Person.
For purposes of this definition, “control”, when used with respect to any
Person, means the power to direct or cause the direction of the management
and
policies of such Person, directly or indirectly, whether through the ownership
or voting securities, by contract or otherwise.
“Agreement”
has
the
meaning given to such term in the preamble
hereto.
“Amended
Agreement”
has
the
meaning given to such term in the preamble
hereto.
“Bilateral
Transaction”
means,
with respect to each sale of Ethanol produced at the Facility by Project
Company, a transaction entered into by Kinergy with one or more Third Parties
consisting of one or more forward sales of Ethanol.
“Business
Day”
means
any day other than a Saturday, Sunday or a day on which commercial banks in
Denver, Colorado are required or authorized to be closed.
“Commercial
Operations Date”
means
the date of “Substantial Completion” under and as defined in the Construction
Agreement.
“Construction
Agreement”
means
the Design-Build
Agreement, dated March 24th
2005, by
and between Project Company and
Contractor, including all amendments thereto and all other agreements by and
between Project Company and Contractor for the engineering, procurement and
construction of the Facility.
“Contractor”
means
ICM, a Kansas LLC.
“Direct
Purchase”
has
the
meaning given to such term in Section
2.1(b).
2
“Dispute”
means
a
dispute, controversy or claim.
“Ethanol”
means
denatured fuel ethanol produced by the Facility satisfying the American Society
for Testing and Materials (ASTM) D4806 specifications for denatured fuel
ethanol.
“Expert”
means
an expert having sufficient technical expertise to address the matter subject
to
a Dispute.
“Facility”
has
the
meaning given to such term in the recitals
hereto.
“Financing
Documents”
means
any and all loan agreements, credit agreements, reimbursement agreements, notes,
indentures, bonds, security agreements, pledge agreements, mortgages, guarantee
documents, intercreditor agreements, subscription agreements, equity
contribution agreements and other agreements and instruments relating to the
financing (or refinancing) of the development, engineering, design,
construction, operation, ownership and maintenance of the Facility.
“Financing
Parties”
means
the banks, lenders, noteholders and/or other financial institutions (or an
agent
or trustee thereof) party to the Financing Documents.
“Force
Majeure Event”
has
the
meaning set forth in Section
8.1.
“Good
Industry Practice”
means
any of the practices, methods and acts engaged in or approved by a significant
portion of the ethanol production or marketing (as the case may be) industry
during the relevant time period, or any of the practices, methods and acts
which, in the exercise of reasonable judgment in light of the facts known at
the
time the decision was made, could have been expected to accomplish the desired
result at a reasonable cost consistent with good business practices,
reliability, safety and expedition. Good Industry Practice is not limited to
a
single, optimum practice, method or act to the exclusion of others, but rather
is intended to include acceptable practices, methods or acts generally accepted
in the region.
“Governmental
Authority”
means
any United States federal, state, municipal, local, territorial, or other
governmental department, commission, board, bureau, agency, regulatory
authority, instrumentality, judicial or administrative body.
“Incentive
Fee”
means,
for each Payment Period and with respect to Kinergy, the product of (a) 1.0%
multiplied
by
(b) the
difference between (i) the aggregate amount of the Purchase Price associated
with all Bilateral Transactions for such Payment Period minus (ii)
the
aggregate amount of Transaction Costs associated with all Bilateral Transactions
for such Payment Period.
“Kinergy”
has
the
meaning given to such term in the preamble
hereto.
“Kinergy
Indemnified Person”
has
the
meaning given to such term in Section
6.2.
3
“Law”
means
any law, statute, act, legislation, ▇▇▇▇, enactment, policy, treaty,
international agreement, ordinance, judgment, injunction, award, decree, rule,
regulation, interpretation, determination, requirement, writ or order of any
Governmental Authority.
“Liabilities”
has
the
meaning given to such term in Section
6.1.
“Material
Bilateral Transaction”
means
any Bilateral Transaction having a term in excess of one-year or pursuant to
which the aggregate gross payments reasonably anticipated to be made by the
applicable Third Party to Kinergy thereunder exceed $10,000,000 per
calendar year.
“Monthly
Date”
means
the last Business Day of each calendar month.
“Party”
or
“Parties”
has
the
meaning given to such term in the preamble
hereto.
“Payment
Period”
has
the
meaning given to such term in Section
3.1(a).
“PEI”
has
the
meaning given to such term in the recitals
hereto.
“Permits”
means
all permits, authorizations, registrations, consents, approvals, waivers,
exceptions, variances, orders, judgments, written interpretations, decrees,
licenses, exemptions, publications, filings, notices to and declarations of
or
with, or required by, any Governmental Authority, or required by any Law, and
shall include all environmental and operating permits and licenses that are
required for the full use, occupancy, zoning and operation of the
Facility.
“Person”
means
and includes natural persons, corporations, limited liability companies, limited
partnerships, general partnerships, joint stock companies, joint ventures,
associations, companies, trusts, banks, trust companies and other organizations,
whether or not legal entities, Governmental Authorities and any other
entity.
“Prime
Rate”
means
the rate per annum listed as the “Prime Rate” in the “Money Rates” section of
The Wall Street Journal from time to time.
“Project
Company”
has
the
meaning given to such term in the preamble
hereto.
“Project
Company Indemnified Person”
has
the
meaning given to such term in Section
6.1.
“Purchase
Price”
means,
subject to Section 3.1(a), the aggregate amount of gross payments received
(or
deemed received) by Kinergy during such Payment Period from the applicable
Third
Parties in respect of such Bilateral Transactions.
“Third
Party”
means
any Person (other than PEI or a subsidiary thereof) that enters into a Bilateral
Transaction with Kinergy.
4
“Transaction
Costs”
means,
for each Payment Period and with respect to Kinergy, all reasonable,
out-of-pocket and documented costs and expenses (other than taxes on net income,
business taxes paid by Kinergy, or tax on the sale of Ethanol (such sales taxes
to be paid directly by the Project Company), but including all other taxes
and
governmental charges and assessments) incurred by or on behalf of Kinergy in
connection with all Bilateral Transactions pursuant to this Amended Agreement
during such Payment Period, including truck, rail and terminal costs for the
transportation and storage of the applicable Ethanol to the applicable Third
Party and reasonable, documented out-of-pocket expenses incurred in connection
with the negotiation and documentation of the applicable sales agreement between
Kinergy and the applicable Third Parties.
1.2
Interpretation
The
following interpretations and rules of construction shall apply to this Amended
Agreement:
(a)
titles
and headings are for convenience only and will not be deemed part of this
Amended Agreement for purposes of interpretation;
(b)
unless
otherwise stated, references in this Amended Agreement to “Sections” or
“Articles” refer, respectively, to Sections or Articles of this Amended
Agreement;
(c)
“including”
means “including, but not limited to”, and “include” or “includes” means
“include, without limitation” or “includes, without limitation”;
(d)
“hereunder”,
“herein”, “hereto” and “hereof”, when used in this Amended Agreement, refer to
this Amended Agreement as a whole and not to a particular Section or clause
of
this Amended Agreement;
(e)
in
the
case of defined terms, the singular includes the plural and vice
versa;
(f)
unless
otherwise indicated, all accounting terms not specifically defined shall be
construed in accordance with generally accepted accounting practices in the
United States;
(g)
unless
otherwise indicated, each reference to a particular Law is a reference to such
Law as it may be amended, modified, extended, restated or supplemented from
time
to time, as well as to any successor Law thereto;
(h)
unless
otherwise indicated, references to agreements shall be deemed to include all
subsequent amendments, supplements and other modifications thereto;
and
(i)
unless
otherwise indicated, each reference to any Person shall include such Person’s
successors and permitted assigns.
5
ARTICLE
II
PURCHASE
TRANSACTIONS AND MARKETING ACTIVITIES
2.1
Marketing
and Purchase of Ethanol
(a)
Subject
to the terms hereof, the Project Company hereby grants Kinergy the exclusive
right to market and sell, or to purchase for Kinergy’s own account, all of the
Project Company’s Ethanol (which, as of the date hereof, is estimated to be
approximately 35 million gallons-per-year). The Project Company hereby grants
Kinergy the power and authority necessary to perform its obligations and
exercise its rights hereunder.
(b)
All
purchases and sales of Ethanol pursuant to this Amended Agreement shall take
place in one of the two following ways:
(i)
Direct
purchases for the account of Kinergy, in accordance with Section
2.2
(each, a
“Direct Purchase”); and
(ii)
Sales
to
Third Parties pursuant to a Bilateral Transactions, in accordance with
Section
2.3
(each, a
“Bilateral Purchase”).
(c)
The
Parties shall confirm in writing in advance of every purchase and sale of
Ethanol pursuant to this Amended Agreement whether such purchase and sale shall
be treated as a Direct Purchase or a Bilateral Purchase. Each of the Parties
agrees that Kinergy shall not request that the Project Company deliver Ethanol
to Kinergy (or
any
Third Party designated by Kinergy)
unless,
as of the scheduled date of delivery, Kinergy has entered into a Direct Purchase
or a Bilateral Transaction with respect to such Ethanol.
2.2
Direct
Purchases
Kinergy
may from time to time offer to purchase Ethanol from Project Company for its
own
account. An offer for a Direct Purchase shall include the quantity that Kinergy
proposes to purchase, the price at which Kinergy proposes to purchase, the
proposed timing of delivery, and such other terms as Kinergy desires to include.
If the offer is in connection with an arbitrage opportunity, the offer shall
so
state and shall also include a description of the specific arbitrage
opportunity, including a statement of the anticipated arbitrage profit. If
Project Company accepts Kinergy’s offer, then the purchase and sale of Ethanol
pursuant to such offer shall be deemed a Direct Purchase under this Amended
Agreement. Kinergy shall assume the market risk associated with all Direct
Purchases, and shall be entitled to retain all profits on the resale of Ethanol
purchased from Project Company pursuant to Direct Purchases. Notwithstanding
the
foregoing, with respect to specific identified arbitrage opportunities, Kinergy
shall be entitled to retain fifty percent (50%) of the identified arbitrage
profit and shall remit fifty percent (50%) of the arbitrage profit to Project
Company, unless the parties agree in writing to a different arrangement.
6
2.3
Bilateral
Transactions
(a)
Kinergy
shall use its reasonable commercial efforts to solicit, negotiate and enter
into, and Kinergy shall perform, Bilateral Transactions with Third Parties,
and
such Bilateral Transactions shall be served by the Facility. Other than as
set
forth in Sections
2.3(d)
and
2.6
below,
Kinergy shall have absolute discretion in the solicitation, negotiation,
administration (including the collection of payments) and execution of Bilateral
Transactions. Project Company shall operate the Facility as required to allow
Kinergy to perform such Bilateral Transactions.
(b)
In
the
event of a breach or default by a Third Party under any Bilateral Transaction,
Kinergy shall (i) promptly notify the Project Company of any such breach and
default and provide the Project Company from time to time with reasonably
detailed information in respect of the same (including copies of all written
communications in respect thereof) and (ii) at the Project Company’s sole cost
and expense and at the direction of the Project Company, use reasonable
commercial efforts to exercise all rights and remedies available to it
(including the commencement of litigation) with respect to such breach or
default.
(c)
Kinergy
shall perform its obligations hereunder and under Bilateral Transactions in
accordance with this Amended Agreement, applicable Laws, applicable Permits
and
Good Industry Practice and with the intent to maximize the proceeds generated
from Bilateral Transactions.
(d)
Notwithstanding
anything to the contrary herein, Kinergy shall (i) not enter into any Bilateral
Transaction with any Third Party that is the subject of an Act of Insolvency,
(ii) not enter into any Bilateral Transaction that permits the applicable Third
Party to pay for the Ethanol purchased under such Bilateral Transaction on
a
date which is more than 30 days after the Monthly Date in which such Ethanol
is
delivered to such Third Party, (iii) not enter into any Material Bilateral
Transaction without the prior consent of the Project Company, (iv)
not
enter into any Bilateral Transactions which provide for the provision of Ethanol
in excess of the amount of Ethanol available from the Facility (after giving
effect to the Project Company’s or Kinergy’s existing contractual obligations
and the scheduling provisions set forth in Section
2.6(b)
below),
(v) not enter into any Bilateral Transaction which does not excuse Kinergy
from
performing its obligations thereunder as a result of a Force Majeure Event
(vi)
not enter into any Bilateral Transaction during such time as the Facility cannot
provide Ethanol due to a mechanical breakdown (including forced outage of the
Facility), (vii) enter into Bilateral Transactions in its name (and not the
name
of the Project Company) and (viii) require that each Third Party make all
payments under the applicable Bilateral Transaction to a segregated bank-account
in the name of Kinergy (the “Account”)
and
Kinergy shall cause the proceeds of all such Bilateral Transactions received
by
it to be deposited into the Account.
7
(e)
Transaction
Reports
(i)
Within
thirty days after each Monthly Date occurring after the Commercial Operations
Date, Kinergy shall deliver to the Project Company a written summary of the
Bilateral Transactions which were entered into or performed, in whole or in
part, during the month ending on such Monthly Date. Such summary shall specify,
among other things, (i) the amount of Ethanol sold by Kinergy under Bilateral
Transactions during such month, (ii) the Third Parties which entered into such
Bilateral Transactions and the amount of Ethanol purchased thereby, and (iii)
whether and to the extent any such Third Parties or Kinergy breached its
obligations under any such Bilateral Transactions.
(ii)
In
addition, Kinergy shall provide to the Project Company on a monthly basis a
customary bank account statement with respect to the Account (which statement
shall reflect, among other things, (i) deposits into and withdrawals from the
Account during the applicable monthly period and (ii) the balance of funds
in
the Account).
(f)
Back-to-Back
Transactions.
Each
Bilateral Transaction undertaken by Kinergy shall immediately and automatically,
without necessity of further documentation or any action whatsoever by any
of
the Parties, create and cause to be undertaken according to the terms of this
Amended Agreement an equivalent transaction in terms of the obligation to
deliver Ethanol, the quantity of Ethanol sold and the timing for the delivery
of
such Ethanol by the Project Company with Kinergy (as if Kinergy were the Third
Party).
2.4
Storage
Kinergy
acknowledges that the Project Company has only limited storage capacity and
Kinergy agrees that it shall take any Ethanol requested by Kinergy pursuant
to
the operating protocol established pursuant to Section
2.6(b)
within
seven days of the time that the Project Company has made such Ethanol available
to Kinergy. In the event that stored Ethanol exceeds storage capacity more
than
two times in any 60-day period or for longer than 24 hours at any given time,
the Project Company shall have the right, in addition to any other claims
available to the Project Company under applicable Laws, to terminate for cause
this Amended Agreement. A default under this Section shall be communicated
to
Kinergy’s designated representative by facsimile or email.
2.5
Obligations
of the Project Company
(a)
The
Project Company shall provide Kinergy with all information reasonably requested
by Kinergy, and the Project Company shall assist Kinergy as reasonably requested
in the solicitation, negotiation and performance of Direct Purchases and
Bilateral Transactions.
8
(b)
Notwithstanding
anything to the contrary herein, the Project Company shall not be responsible
for the delivery of any Ethanol to Kinergy during any periods of scheduled
Facility maintenance (unless and to the extent the applicable Ethanol is
available to be delivered to Kinergy from the Project Company’s storage
facilities); provided,
that
(i) Kinergy shall have received at least ten Business Days prior notice of
such
scheduled maintenance, (ii) such maintenance shall have been scheduled in
accordance with the operating protocol referred to in Section
2.6(b)
below
and (iii) Kinergy has not, prior to the receipt of any such notice, entered
into
binding Direct Purchases or Bilateral Transactions which require Project Company
supply Ethanol to Kinergy or Third Parties during such scheduled maintenance
periods.
(c) If
on any
day, the Project Company is unable to perform its obligations to deliver Ethanol
under this Amended Agreement due to a mechanical breakdown (including a forced
outage of the Facility) that is not a Force Majeure Event and such mechanical
breakdown has continued for more than five consecutive days, the Project Company
shall, at its option and provided that the Project Company provides Kinergy
with
prompt notice of its intent to exercise such option, procure replacement
denatured fuel ethanol to be delivered to Kinergy or the Third Party, as
applicable. In such event, if and only if the Parties reach agreement as to
an
alternative delivery point, the Project Company shall deliver to Kinergy
replacement denatured fuel ethanol in a quantity sufficient to meet the contract
quantity of such Bilateral Transaction at such alternate point (and the Project
Company shall be responsible for all transportation costs associated therewith).
In all other instances, the Project Company shall be responsible for any damages
incurred by Kinergy in connection with Project Company’s failure to perform
under the applicable Direct Purchase, or Kinergy’s failure to perform under the
applicable Bilateral Transaction, as a result of such mechanical breakdown
(it
being acknowledged and agreed that Kinergy shall use commercially reasonable
efforts to mitigate the effects of any such mechanical breakdown and the Project
Company’s resulting inability to deliver Ethanol including the identification
and procurement (at the Project Company’s cost) of potential replacement
denatured fuel ethanol).
2.6
Title;
Delivery Point; Nominations; Measurement
(a)
The
Project Company shall deliver Ethanol to Kinergy at the inlet flange of the
applicable receiving truck that will remove such Ethanol from the Facility.
Title to, risk of loss with respect to and the obligation to transport such
Ethanol shall pass from the Project Company to Kinergy at such delivery point.
The Parties acknowledge that the quality and quantity of Ethanol may degrade
or
shrink after such Ethanol is delivered by the Project Company to Kinergy at
such
delivery point, and the Parties acknowledge that the risk of such degradation
or
shrinkage and all other risk of loss shall be borne by Kinergy.
9
(b)
Prior
to
the Commercial Operations Date, Kinergy and the Project Company shall agree
on
an operating protocol with respect to the mechanics, timing and process for
(i)
determining how much Ethanol is available to be sold on any particular day,
(ii)
Kinergy to communicate to the Project Company its Ethanol requirements on a
monthly, weekly and daily basis, (iii) determining the quantity of Ethanol
to be
stored by the Project Company in its storage facilities, (iv) identifying
Persons to transport the Ethanol to Third Parties and (v) implementing the
Ethanol sales contemplated by this Amended Agreement. By mutual agreement,
such
operating protocol shall be updated from time to time thereafter.
(c)
On
or
before the date that is fifteen days prior to the end of a calendar month,
the
Project Company shall provide Kinergy with a forecast of its projected monthly
Ethanol production for the following month.
(d)
The
Project Company agrees to collect samples of each shipment of Ethanol it
delivers to Kinergy hereunder. The Project Company shall label each sample
to
include the customer order number and any other information reasonably necessary
to identify such Ethanol and the applicable shipment. Kinergy shall have the
right, upon reasonable notice and at reasonable times and at its expense, to
test such samples to confirm that the Ethanol delivered to it hereunder meets
the requirements of this Amended Agreement. The Parties agree that the amount
of
Ethanol delivered hereunder (whether measured as net gallons, net liters or
otherwise) shall be corrected to and correspondingly adjusted by a reference
temperature of 60 degrees Fahrenheit or 15.56 degrees Celsius.
(e)
As
further described in Sections
2.3,
and
2.6
and
except as otherwise provided herein, the Project Company shall provide Ethanol
to Kinergy free and clear of all liens and encumbrances.
ARTICLE
III
PAYMENTS
3.1
Fees
and Payments
(a)
On
the
fifth Business Day and the twentieth Business Day of each calendar month (the
period of time between such dates being referred to herein as a “Payment
Period”),
Kinergy shall pay to the Project Company an amount equal to (a) the Purchase
Price for such Payment Period minus (b)
the
aggregate amount of Transaction Costs for such Payment Period minus
(c) the
aggregate amount of the Incentive Fee for such Payment Period (it being
acknowledged that Kinergy shall retain for its own account the amount of such
Transaction Costs and Incentive Fee). In connection with each such payment,
Kinergy shall deliver to the Project Company a statement detailing its
calculations of the applicable Purchase Price, the applicable Transaction Costs
and the applicable Incentive Fee. During
the first 90 days of production at FRE, Kinergy will pay FRE each Friday for
the
previous week’s shipments of ethanol.
10
(b)
On
the
fifth Business Day and the twentieth Business Day of each calendar month,
Kinergy shall pay to the Project Company the aggregate purchase price in respect
of Direct Purchases of Ethanol that shipped during the Payment Period, plus
any
arbitrage profit owing to the Project Company on account of specific identified
arbitrage opportunities during such period. In connection with each such
payment, Kinergy shall deliver to the Project Company a statement detailing
its
calculations of the applicable purchase price and arbitrage profit.
3.2
Overdue
Payments; Indemnity Payments
(a)
If
any
Party shall fail to make any payment when due hereunder, such overdue payment
shall accrue interest at the Prime Rate plus
5% from
the date originally due until the date paid.
(b)
Any
indemnification payments received by Kinergy from a Third Party in respect
of a
Bilateral Transaction (net of Kinergy’s expenses related to the matter for which
such indemnification payments were received) shall be paid to the Project
Company on or before the next payment date as determined in accordance with
Section 3.1(a).
3.3
Billing
Dispute
If
the
Project Company or Kinergy, in good faith, disputes the amount of any payment
received by it or to be paid by it or set-off pursuant to Section
3.1
above,
the disputing Party shall immediately notify the other Party of the basis for
the dispute. The Parties will then meet and use their best efforts to resolve
any such dispute. If any amount is ultimately determined to be due to or
permitted to be set-off by the Project Company or Kinergy (as the case may
be),
to the extent not previously paid or set-off, (a) Kinergy shall pay such amount
to the Project Company within five Business Days of such determination or (b)
Kinergy may then set-off such amount (as the case may be).
3.4
Audit
Notwithstanding
the payment of any amount pursuant to this Article III,
the
Project Company shall remain entitled (upon reasonable prior notice, at
reasonable times and at Kinergy’s corporate offices) to conduct a subsequent
audit and review of (a) all Bilateral Transactions and related records to verify
the amount of gross payments, Incentive Fees, Transaction Costs and damage
payments and (b) the determination and calculation of the Purchase Price, in
each case for a period of two years from and after the end of the applicable
Payment Period. If, pursuant to such audit and review, it is determined that
any
amount previously paid by Kinergy to the Project Company did not constitute
all
of the amounts which should have been paid to the Project Company, the Project
Company shall advise Kinergy indicating such amount and reason the amount should
have been paid to the Project Company and, subject to the next two sentences,
Kinergy shall pay such amount to the Project Company within five Business Days
of such request along with interest accrued at the Prime Rate plus
5% from
the date originally due until the date paid. If there is not agreement of any
item so noted, the Parties will then meet and use their best efforts to resolve
the dispute. If Parties are not able to resolve issues raised by such an audit
and review, any disputed items will be resolved in accordance with the
provisions of Article
IX.
11
ARTICLE
IV
TERM;
TERMINATION
4.1
Term.
This
Amended Agreement shall be effective on the date hereof and, unless earlier
terminated in accordance with its terms, shall continue in effect until June
9,
2009; provided,
that the
term of this Amended Agreement shall automatically renew and be extended for
additional one-year periods thereafter unless a Party elects to terminate this
Amended Agreement in a writing delivered to the other Party at least 60-days
prior to the end of the original or renewal term.
4.2
Termination
by
Kinergy
Kinergy
may terminate this Amended Agreement by written notice to the Project Company,
upon the occurrence of any of the following events, provided,
that no
such notice shall be required for a termination pursuant to clause (c) of this
Section
4.2:
(a)
the
failure by the Project Company to make any payment, deposit or transfer required
hereunder within 30 Business Days after the date such payment, deposit or
transfer is required to be made;
(b)
the
failure of any statement, representation or warranty made by the Project Company
in this Amended Agreement to have been correct in any material respect when
made
if such failure could reasonably be expected to have a material adverse effect
on the Project Company’s ability to perform its obligations under this Amended
Agreement;
(c)
the
occurrence of an Act of Insolvency with respect to the Project
Company;
or
(d)
the
failure of the Project Company to perform any of its material obligations under
this Amended Agreement and such failure continues for 30 days after receipt
of
written notice from Kinergy of such failure; provided,
that
such 30-day period shall be extended for up to an aggregate of 90 days so long
as the Project Company is diligently attempting to cure such failure.
4.3
Termination
by the Project Company
The
Project Company may terminate this Amended Agreement by written notice to
Kinergy, upon the occurrence of any of the following events, provided,
that no
such notice shall be required for a termination pursuant to clause (c) of this
Section
4.3:
(a)
the
failure by Kinergy to make any payment, deposit or transfer required hereunder
within fifteen Business Days after the date such payment, deposit or transfer
is
required to be made;
12
(b)
the
failure of any statement, representation or warranty made by Kinergy in this
Amended Agreement to have been correct in any material respect when made if
such
failure could reasonably be expected to have a material adverse effect on
Kinergy’s ability to perform its obligations under this Amended
Agreement;
(c)
the
occurrence of an Act of Insolvency with respect to Kinergy;
(d)
the
failure of Kinergy to perform any of its material obligations under this Amended
Agreement and such failure continues for 30 days after receipt of written notice
from the Project Company of such failure; provided,
that
such 30-day period shall be extended for up to an aggregate of 90 days so long
as Kinergy is diligently attempting to cure such failure; or
(e)
the
occurrence of any termination event under Section
2.4.
4.4
Change
of Control
(a)
Either
Party shall have the option to terminate this Amended Agreement for convenience
upon thirty days written notice to the other Party from and after the occurrence
of any transfer, assignment, sale or other disposition (exclusive of any
transfers, assignments, sales or other dispositions in connection with a
foreclosure or exercise of remedies by the Financing Parties, which shall be
governed exclusively by clause (b) below) of (i) all or substantially all of
the
assets comprising the Facility
or (ii)
more than a majority of the membership interests of the Project Company or
Kinergy to any Person which is not an Affiliate of PEI.
Any
termination pursuant to this Section 4.4(a) shall be effective 30 days after
written notice is provided by the terminating Party to the other
Party.
(b)
If
as a
result of a foreclosure on or similar exercise of remedies in respect of the
Project Company or the Facility the collateral agent under the Financing
Documents (or its designee or transferee) becomes a party to this Amended
Agreement or directly or indirectly controls all or substantially all of the
assets of, or a majority of the membership interests in, the Project Company,
the Project Company shall have the right to terminate this Amended Agreement
for
convenience upon thirty days written notice to Kinergy.
4.5
Effect
of Termination
No
termination under this Article
IV
shall
release any of the Parties from any obligations arising hereunder prior to
such
termination, including obligations under any Bilateral Transaction (or such
Bilateral Transaction’s corresponding back-to-back transaction arising under
Section
2.3(f))
that is
not fully performed as of the date of such termination. The exercise of the
right of a Party to terminate this Amended Agreement, as provided herein, does
not preclude such Party from exercising other remedies that are provided herein
or are available at law or in equity; provided,
however,
that no
Party shall have a right to terminate, revoke or treat this Amended Agreement
as
repudiated other than in accordance with the other provisions of this Amended
Agreement; and provided,
further,
that
the Parties’ respective rights upon termination shall be subject to the
liability limitations of Article
V.
Except
as otherwise set forth in this Amended Agreement, remedies are cumulative,
and
the exercise of, or the failure to exercise, one or more remedies by a Party
shall not, to the extent provided by Law, limit or preclude the exercise of,
or
constitute a waiver of, other remedies by such Party.
13
ARTICLE
V
LIMITATIONS
ON LIABILITY
5.1
Maximum
Liability of Kinergy
The
total
aggregate liability of Kinergy to the Project Company under this Amended
Agreement during the term of this Amended Agreement shall not exceed the
aggregate amount of Incentive Fees received by Kinergy. The liability of Kinergy
to the Project Company under this Amended Agreement during any calendar year
shall not exceed the aggregate amount of Incentive Fees received by Kinergy
during such year. Notwithstanding the foregoing, such limitations on liability
shall not apply with respect to any net loss, damage or liability resulting
from
or arising out of the gross negligence or willful misconduct of
Kinergy.
5.2
No
Consequential or Punitive Damages
In
no
event shall either Party be liable to any other Party by way of indemnity or
by
reason of any breach of contract or of statutory duty or by reason of tort
(including negligence or strict liability) or otherwise for any loss of profits,
loss of revenue, loss of use, loss of production, loss of contracts or for
any
incidental, indirect, special or consequential or punitive damages of any other
kind or nature whatsoever that may be suffered by such other Party, including
any losses for which such other Party has insurance to the extent proceeds
of
insurance have been recovered for such losses.
ARTICLE
VI
INDEMNIFICATION
6.1
The
Project Company’s Indemnity
The
Project Company shall defend, indemnify and hold harmless Kinergy and its
Affiliates (and each officer, director, employee, shareholder, partner, member
or agent of Kinergy and its Affiliates) (each, a “Project
Company Indemnified Person”)
from
and against any and all third party claims, actions, damages, expenses
(including reasonable and documented attorneys’ fees and expenses), losses,
settlements or liabilities (collectively, “Liabilities”)
incurred or asserted against any Project Company Indemnified Person (a) as
a
result of any failure on the part of the Project Company to perform the Project
Company’s obligations under this Amended Agreement (including with respect to
any back-to-back transaction under Section 2.3(f)), or (b) arising out of or
in
any way connected with the grossly negligent acts or omissions of the Project
Company or its Affiliates (other than Kinergy).
14
6.2
Kinergy’s
Indemnity
Kinergy
shall defend, indemnify and hold harmless the Project Company and its Affiliates
(and each officer, director, employee, shareholder, partner, member or agent
of
the Project Company and their Affiliates) (each, a “Kinergy
Indemnified Person”)
from
and against any and all third party Liabilities incurred or asserted against
any
Kinergy Indemnified Person (a) as a result of any failure on the part of Kinergy
to perform its obligations under this Amended Agreement (including with respect
to any Bilateral Transaction), or (b) arising out of or in any way connected
with the grossly negligent acts or omissions of Kinergy or its Affiliates (other
than the Project Company).
ARTICLE
VII
REPRESENTATIONS
AND WARRANTIES
7.1
Kinergy’s
Representations and Warranties
Kinergy
represents and warrants to the Project Company, as of the date hereof, as
follows:
(a)
Due
Formation.
Kinergy
(i) is a limited liability company duly formed and validly existing under the
laws of the State of Oregon, (ii) has the requisite power and authority to
own
its properties and carry on its business as now being conducted and currently
proposed to be conducted and to execute, deliver and perform its obligations
under this Amended Agreement, and (iii) is qualified to do business in the
State
of California and in every other jurisdiction in which failure so to qualify
could be reasonably be expected to have a material adverse effect on Kinergy’s
ability to perform its obligations hereunder.
(b)
Authorization;
Enforceability.
Kinergy
has taken all action necessary to authorize it to execute, deliver and perform
its obligations under this Amended Agreement. This Amended Agreement constitutes
a legal, valid and binding obligation of Kinergy enforceable in accordance
with
its terms, subject to bankruptcy, reorganization, moratorium or other similar
laws affecting the enforcement of the rights of creditors generally and subject
to general principles of equity.
(c)
No
Conflict.
The
execution, delivery and performance by Kinergy of this Amended Agreement does
not and will not (i) violate any Law applicable to Kinergy, (ii) result in
any
breach of Kinergy’s constituent documents or (iii) conflict with, violate or
result in a breach of or constitute a default under any agreement or instrument
to which Kinergy or any of its properties or assets is bound or result in the
imposition or creation of any lien or security interest in or with respect
to
any of Kinergy’s property or assets, other than in each case any such
violations, conflicts, breaches or impositions which could not be reasonably
be
expected to have a material adverse effect on Kinergy’s ability to perform its
obligations hereunder.
15
(d)
No
Authorization.
No
authorization or approval or other action by, and no notice to or filing with,
any Governmental Authority (other than those which have been obtained) is
required for the due execution, delivery and performance by Kinergy of this
Amended Agreement, other than any such authorizations, approvals or actions
the
failure of which to obtain could not be reasonably be expected to have a
material adverse effect on Kinergy’s ability to perform its obligations
hereunder.
(e)
Litigation.
Kinergy
is not a party to any legal, administrative, arbitration or other proceeding,
and, to Kinergy’s knowledge, no such proceeding is threatened, which could be
reasonably be expected to have a material adverse effect on Kinergy’s ability to
perform its obligations hereunder.
7.2
The
Project Company’s Representations and Warranties
The
Project Company represents and warrants to Kinergy, as of the date hereof,
as
follows:
(a)
Due
Formation.
The
Project Company (i) is a limited liability company duly formed and validly
existing under the laws of the State of Delaware, (ii) has the requisite power
and authority to own its properties and carry on its business as now being
conducted and currently proposed to be conducted and to execute, deliver and
perform its obligations under this Amended Agreement, and (iii) is qualified
to
do business in the State of California and in every other jurisdiction in which
failure so to qualify could be reasonably be expected to have a material adverse
effect on the Project Company’s ability to perform its obligations
hereunder.
(b)
Authorization;
Enforceability.
The
Project Company has taken all action necessary to authorize it to execute,
deliver and perform its obligations under this Amended Agreement. This Amended
Agreement constitutes a legal, valid and binding obligation of the Project
Company enforceable in accordance with its terms, subject to bankruptcy,
reorganization, moratorium or other similar laws affecting the enforcement
of
the rights of creditors generally and subject to general principles of
equity.
(c)
No
Conflict.
The
execution, delivery and performance by the Project Company of this Amended
Agreement does not and will not (i) violate any Law applicable to the Project
Company, (ii) result in any breach of the Project Company’s constituent
documents or (iii) conflict with, violate or result in a breach of or constitute
a default under any agreement or instrument to which the Project Company or
any
of its properties or assets is bound or result in the imposition or creation
of
any lien or security interest in or with respect to any of the Project Company’s
property or assets, other than in each case any such violations, conflicts,
breaches or impositions which could not be reasonably be expected to have a
material adverse effect on the Project Company’s ability to perform its
obligations hereunder.
16
(d)
No
Authorization.
No
authorization or approval or other action by, and no notice to or filing with,
any Governmental Authority (other than those which have been obtained) is
required for the due execution, delivery and performance by the Project Company
of this Amended Agreement, other than any such authorizations, approvals or
actions the failure of which to obtain could not be reasonably be expected
to
have a material adverse effect on the Project Company’s ability to perform its
obligations hereunder.
(e)
Litigation.
The
Project Company is not a party to any legal, administrative, arbitration or
other proceeding, and, to the Project Company’s knowledge, no such proceeding is
threatened, which could be reasonably be expected to have a material adverse
effect on the Project Company’s ability to perform its obligations hereunder.
ARTICLE
VIII
FORCE
MAJEURE
8.1
Definition
As
used
herein, “Force
Majeure Event”
means
any cause(s) which render(s) a Party wholly or partly unable to perform its
obligations under this Amended Agreement (other than obligations to make
payments when due), and which are neither reasonably within the control of
such
Party nor the result of the fault or negligence of such Party, and which occur
despite all reasonable attempts to avoid, mitigate or remedy, and shall include
acts of God, war, riots, civil insurrections, cyclones, hurricanes, floods,
fires, explosions, earthquakes, lightning, storms, chemical contamination,
epidemics or plagues, acts or campaigns of terrorism or sabotage, blockades,
embargoes, accidents or interruptions to transportation, trade restrictions,
acts of any Governmental Authority after the date of this Amended Agreement,
strikes and other labor difficulties, and other events or circumstances beyond
the reasonable control of such Party. Mechanical breakdown (including a forced
outage of the Facility) that continues for more than five consecutive days
shall
be deemed not to be “Force Majeure Event” unless such mechanical breakdown
resulted from or was caused by a separate “Force Majeure Event.”
8.2
Effect
A
Party
claiming relief as a result of a Force Majeure Event shall give the other
Parties written notice within five Business Days of becoming aware of the
occurrence of the Force Majeure Event, or as soon thereafter as practicable,
describing the particulars of the Force Majeure Event, and will use reasonable
efforts to remedy its inability to perform as soon as possible. If the Force
Majeure Event (including the effects thereof) continues for fifteen consecutive
days, the affected Party shall report to the other Parties the status of its
efforts to resume performance and the estimated date thereof. If the Force
Majeure Event (including the effects thereof) continues for 180 consecutive
days, the affected Party may terminate this Amended Agreement for convenience.
If the affected Party was not able to resume performance prior to or at the
time
of the report to the other Parties of the onset of the Force Majeure Event,
then
it will report in writing to the other Parties when it is again able to perform.
If a Party fails to give timely notice, the excuse for its non-performance
shall
not begin until notice is given.
17
8.3
Limitations
Any
obligation(s) of a Party (other than an obligation to make payments when due)
may be temporarily suspended during any period such Party is unable to perform
such obligation(s) by reason of the occurrence of a Force Majeure Event, but
only to the extent of such inability to perform, provided,
that:
(a)
the
suspension of performance is of no greater scope and of no longer duration
than
is reasonably required by the Force Majeure Event; and
(b)
the
Party
claiming the occurrence of the Force Majeure Event bears the burden of
proof.
ARTICLE
IX
DISPUTE
RESOLUTION
9.1
Attempts
to Settle
In
the
event that a Dispute among the Parties arises under, out of or in relation
to,
this Amended Agreement, the Parties shall attempt in good faith to settle such
Dispute by mutual discussions within fifteen Business Days after the date that
an aggrieved Party gives written notice of the Dispute to the other Parties.
In
the event that a Dispute is not resolved by discussion in accordance with the
preceding sentence within the time period set forth therein, the Parties shall
refer the Dispute to their respective senior officers for further consideration
and attempted resolution within fifteen Business Days after the Dispute has
been
referred to such individuals (or such longer period as the Parties may
agree).
9.2
Resolution
by Expert
If
the
Parties shall have failed to resolve the Dispute within fifteen Business Days
after the date that the Parties referred the Dispute to their senior officers,
then, provided the Parties shall so agree, the Dispute may be submitted for
resolution by an Expert, such Expert to be appointed by the mutual agreement
of
the Parties. Proceedings before an Expert shall be held in Fresno, California
(or any other location agreed to by the Parties). The Expert shall apply to
such
proceedings the substantive law of the State of California in effect at the
time
of such proceedings. The decision of the Expert shall be final and binding
upon
the Parties. In the event that (a) the Parties cannot agree on the appointment
of an Expert within ten Business Days after the date that the Parties agreed
to
submit the Dispute for resolution by the Expert or (b) the Expert fails to
resolve such Dispute within 60 days after the Parties have submitted such
Dispute to the Expert, then any Party may file a demand for arbitration in
writing in accordance with Section
9.3.
18
9.3
Arbitration
Any
Dispute that has not been resolved following the procedures set forth in
Section
9.1
or
9.2
shall be
settled by binding arbitration in Fresno, California (or any other location
agreed to by the Parties) before a panel of three arbitrators. Such arbitration
shall be conducted in accordance with the Commercial Arbitration Rules of the
American Arbitration Association as in effect on the date of execution of this
Amended Agreement. Such arbitration shall be governed by the laws of the State
of California. If arbitration proceedings have been initiated pursuant to this
Section
9.3
and
raise issues of fact or law which, in whole or in part, are substantially the
same as issues of fact or law already pending in arbitration proceedings
involving the applicable Parties, such issues shall be consolidated with the
issues in the ongoing proceedings. THE PARTIES HEREBY AGREE THAT THE PROCEDURES
SET FORTH IN THIS ARTICLE
IX
SHALL BE
THE EXCLUSIVE DISPUTE RESOLUTION PROCEDURES APPLICABLE TO ANY DISPUTE,
CONTROVERSY OR CLAIM UNDER THIS AMENDED AGREEMENT AND, EXCEPT AS SET FORTH
IN
SECTION
9.5,
THE
PARTIES HEREBY WAIVE ALL RIGHTS TO A COURT TRIAL OR TRIAL BY JURY WITH RESPECT
TO ANY DISPUTE, CONTROVERSY OR CLAIM UNDER THIS AMENDED AGREEMENT.
9.4
Consequential
and Punitive Damages
Awards
of
Experts and arbitral panels shall be subject to the provisions of Article
V.
9.5
Finality
and Enforcement of Decision
Any
decision or award of an Expert or a majority of an arbitral panel, as
applicable, shall be final and binding upon the Parties. Each of the Parties
agrees that the arbitral award may be enforced against it or its assets wherever
they may be found and that a judgment upon the arbitral award may be entered
in
any court having jurisdiction thereof. The Parties hereby waive any right to
appeal or to review the decision or award of an Expert or an arbitral panel
by
any court or tribunal and also waive any objections to the enforcement of such
decision or award.
9.6
Costs
The
costs
of submitting a Dispute to an Expert shall be shared equally among the Parties
involved in the Dispute, unless the arbitral panel or the Expert determines
otherwise. The costs of arbitration shall be paid in accordance with the
decision of the arbitral panel pursuant to the Commercial Arbitration Rules
of
the American Arbitration Association as in effect on the date of execution
of
this Amended Agreement.
9.7
Continuing
Performance Obligations
While
a
Dispute is pending, each Party shall continue to perform its obligations under
this Amended Agreement, unless such Party is otherwise entitled to suspend
its
performance hereunder or terminate this Amended Agreement in accordance with
the
terms hereof.
19
ARTICLE
X
CONFIDENTIALITY
Each
Party and its Affiliates shall treat as confidential the data and information
in
their possession regarding the Facility, the other Parties or any Affiliate
of
any other Party, unless: (a) the applicable other Party agrees in writing to
the
release of such data or information; (b) such data or information becomes
publicly available other than through the wrongful actions of the disclosing
Party or the disclosing Party’s Affiliate; (c) such data or information was in
the possession of the receiving Party or the receiving Party’s Affiliate prior
to receipt thereof from the disclosing Party with no corresponding
confidentiality obligation; or (d) such data or information is required by
Law
to be disclosed. Notwithstanding the generality of the foregoing, any Party
may
disclose data and information to (i) the officers, directors, managers,
partners, members, employees and Affiliates of such Party, (ii) any successors
in interest and permitted assigns of such Party, (iii) any actual or potential
Financing Parties or actual or potential lenders to PEI or any subsidiary
thereof, and (iv) any potential equity investors in PEI or any subsidiary
thereof; provided,
that
any Person who receives confidential data and information pursuant to an
exception contained in clauses (ii) - (iv) of this Article agrees to similar
confidentiality provisions.
ARTICLE
XI
ASSIGNMENT
AND TRANSFER
No
Party
shall assign this Amended Agreement or any of its rights or obligations
hereunder without first obtaining the prior written consent of (a) in the case
of the Project Company, Kinergy, or (b) in the case of Kinergy, the Project
Company, provided,
that
any Party shall be entitled to assign its rights hereunder (as collateral
security or otherwise) for financing purposes (including a collateral assignment
to any Financing Parties) without the consent of any other Party.
ARTICLE
XII
FURTHER
ASSURANCES; REQUESTS OF FINANCING PARTIES
12.1
Further
Assurances
Each
Party shall from time to time execute and deliver all such further documents
and
instruments as any other Party may reasonably require to effectively carry
out
or better evidence or perfect the full intent and meaning of this Amended
Agreement.
12.2
Requests
of Financing Parties
Kinergy
shall use its reasonable efforts to execute, acknowledge and deliver any and
all
further documents and instruments, and to take any other actions, which may
be
necessary to satisfy the reasonable requests of any Financing Party or
prospective Financing Party in connection with the financing of the Facility,
including delivering to an agent or trustee for the Financing Parties a
customary consent to the assignment by the Project Company of its rights under
this Amended Agreement to the Financing Parties.
20
ARTICLE
XIII
MISCELLANEOUS
13.1
Amended
Agreement; Entire Agreement
This
Amended Agreement amends and restates in its entirety the Ethanol Marketing
Agreement between the Parties dated August 31, 2005. This Amended Agreement
contains the entire agreement between the Parties with respect to the subject
matter hereof and supersedes all prior agreements, negotiations and
understandings among the Parties with respect to such subject matter. Nothing
in
this Amended Agreement shall be construed as creating a partnership or joint
venture between the Parties.
13.2
Counterparts
This
Amended Agreement may be executed in any number of counterparts and each such
counterpart shall be deemed to be an original instrument, but all such
counterparts together shall constitute one and the same agreement.
13.3
Survival
Cancellation,
expiration or earlier termination of this Amended Agreement shall not relieve
the Parties of obligations that by their nature should survive such
cancellation, expiration or termination, including remedies, limitations on
liability, promises of indemnity and payment, and confidentiality. Without
limiting the generality of the foregoing, the following provisions of this
Amended Agreement shall survive: Articles
III,
V,
VI,
IX
and
X.
13.4
Severability
In
the
event any one or more of the provisions contained in this Amended Agreement
should be held invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein shall
not in any way be affected or impaired thereby. The Parties shall endeavor
in
good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions, the economic and practical effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.
13.5
Governing
Law
This
Amended Agreement shall be governed by and construed in accordance with the
internal laws of the State of California, as applied to contracts made and
performed within the State of California, without regard to its conflicts of
law
principles.
13.6
Binding
Effect
This
Amended Agreement shall be binding upon and shall inure to the benefit of the
Parties hereto and their respective successors and permitted assigns. This
Amended Agreement is not made for the benefit of any Person or entity not a
party hereto, and nothing in this Amended Agreement shall be construed as giving
any Person or entity, other than the Parties and their respective successors
and
permitted assigns, any right, remedy or claim under or in respect of this
Amended Agreement or any provision hereof.
21
13.7
Notices
All
notices or other communications which are required or permitted hereunder shall
be in writing and shall be deemed sufficiently given (a) upon delivery, if
delivered personally, (b) the day the notice is received, if it is delivered
by
overnight courier or certified or registered mail, postage prepaid, or (c)
upon
the effective receipt of electronic transmission, facsimile, telex or telegram
(with effective receipt being deemed to occur upon the sender’s receipt of
confirmation of successful transmission of such notice or communication), to
the
addresses set forth below or such other address as the addressee may have
specified in a notice duly given to sender as provided herein:
|
If
to Kinergy:
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||
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Kinergy
Marketing, LLC
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||
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▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
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▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Attention:
|
▇▇.
▇▇▇▇ ▇▇▇▇▇▇▇
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Telephone:
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(▇▇▇)
▇▇▇-▇▇▇▇
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Facsimile: |
(▇▇▇)
▇▇▇-▇▇▇▇
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With
a copy to:
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| Pacific Ethanol, Inc. | ||
| ▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ | ||
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▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ | |
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Attention:
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General Counsel | |
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Telephone:
|
(▇▇▇)
▇▇▇-▇▇▇▇
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Facsimile: |
(▇▇▇)
▇▇▇-▇▇▇▇
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If
to the Project Company:
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Front
Range Energy, LLC
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▇▇
▇▇▇ ▇▇▇
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▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
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Attn: ▇▇▇ ▇▇▇▇▇▇▇ Sr. | |
22
13.8
Amendment
No
Party
hereto shall be bound by any termination, amendment, supplement, waiver or
modification of any term hereof unless such Party shall have consented thereto
in writing.
13.9
No
Implied Waiver
No
delay
or failure on the part of any Party in exercising any rights hereunder, and
no
partial or single exercise thereof, shall constitute a waiver of such rights
or
of any other rights hereunder.
[THE
REMAINDER OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY]
23
IN
WITNESS WHEREOF, this Amended and Restated Ethanol Purchase and Sale Agreement
has been duly executed by the Parties hereto as of the date first written
above.
FRONT
RANGE ENERGY, LLC
By: /s/
▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇
▇▇▇▇▇▇
▇.
▇▇▇▇▇▇▇
Manager
KINERGY
MARKETING, LLC
By: /s/
▇▇▇▇ ▇.
▇▇▇▇▇▇
▇▇▇▇
▇.
▇▇▇▇▇▇
COO
24