| þ | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. |
| o | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. |
| Indiana | 20-2327916 | |
| (State or other jurisdiction of | (I.R.S. Employer Identification No.) | |
| incorporation or organization) |
| Large accelerated filer o | Accelerated filer o | Non-accelerated filer þ | Smaller reporting company o | |||
| (Do not check if a smaller reporting company) |
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2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
Item 1.
Table of Contents
Three Months Ended
Three Months Ended
March 31, 2010
March 31, 2009
(Unaudited)
(Unaudited)
$
54,805,570
$
47,664,537
46,194,728
48,309,527
8,610,842
(644,990
)
165,872
221,265
792,211
794,341
958,083
1,015,606
7,652,759
(1,660,596
)
—
917
683
—
(1,199,081
)
(775,993
)
2,250
540
(1,196,148
)
(774,536
)
$
6,456,611
$
(2,435,132
)
14,606
14,606
$
442.05
$
(166.72
)
Table of Contents
Six Months Ended
Six Months Ended
March 31, 2010
March 31, 2009
(Unaudited)
(Unaudited)
$
118,355,441
$
71,686,402
96,793,063
74,737,350
21,562,378
(3,050,948
)
382,276
365,013
1,479,660
1,246,966
1,861,936
1,611,979
19,700,442
(4,662,927
)
—
917
1,389
—
(2,505,414
)
(1,475,447
)
47,019
11,518
(2,457,006
)
(1,463,012
)
$
17,243,436
$
(6,125,939
)
14,606
14,606
$
1,180.57
$
(419.41
)
Table of Contents
Six Months Ended
Six Months Ended
March 31, 2010
March 31, 2009
(Unaudited)
(Unaudited)
$
17,243,436
$
(6,125,939
)
4,229,434
3,960,729
(2,255,170
)
(625,181
)
(266,583
)
—
(8,832,265
)
(11,529,505
)
693,617
(20,866
)
(453,745
)
(7,248,809
)
(233,362
)
(1,038,823
)
315,913
(159,557
)
1,618,000
564,925
240,207
950,522
2,202,670
3,233,087
237,676
—
(277,506
)
58,993
14,462,322
(17,980,424
)
(73,851
)
(365,076
)
(528,525
)
(12,481,871
)
(237,676
)
—
(840,052
)
(12,846,947
)
—
16,612
(876,360
)
—
—
6,210,000
—
(24,098
)
(3,831
)
(3,517
)
—
24,181,058
(14,216,452
)
—
(15,096,643
)
30,380,055
(1,474,373
)
(447,316
)
7,265,125
461,535
$
5,790,752
$
14,219
$
2,700,504
$
1,489,123
$
351,700
$
889,011
—
6,000
262,441
(3,293,373
)
—
750,000
—
17,243
Table of Contents
Table of Contents
Notes to Condensed Unaudited Financial Statements
March 31,2010
September 30, 2009
(Unaudited)
$
1,460,692
$
1,806,167
1,375,038
1,348,451
2,526,466
2,021,267
882,851
615,417
$
6,245,047
$
5,791,302
Table of Contents
Notes to Condensed Unaudited Financial Statements
Table of Contents
Notes to Condensed Unaudited Financial Statements
Instrument
Balance Sheet Location
Assets
Liabilities
Derivative Instruments — Current
$
—
$
1,142,702
Derivative Instruments — Long Term
—
2,726,406
Derivative Instruments — Current
772,182
—
Amount of (Loss)
Reclassified from
Accumulated OCI into
Derivative in Cash
Amount of (Loss) Recognized in
interest expense on
Flow Hedging
OCI on Derivative - Three-months
Derivative - Three-months
Relationship
ended March 31
ended March 31
Interest rate swap
$
(737,695
)
$
(479,534
)
Interest rate swap
$
(68,073
)
$
—
Derivatives not
Designated as
Location of Gain recognized in
Amount of Gain recognized
Hedging Instruments
Statement of Operations
in Income on Derivatives
Cost of Goods Sold
$
3,164,794
Amount of (Loss)
Reclassified from
Accumulated OCI into
Derivative in Cash
Amount of (Loss) Recognized in
interest expense on
Flow Hedging
OCI on Derivative - Six-months
Derivative - Six-months
Relationship
ended March 31
ended March 31
Interest rate swap
$
(710,553
)
$
(972,993
)
Interest rate swap
$
(3,293,373
)
$
—
Table of Contents
Notes to Condensed Unaudited Financial Statements
Derivatives not
Designated as
Location of Gain recognized in
Amount of Gain recognized
Hedging Instruments
Statement of Operations
in Income on Derivatives
Cost of Goods Sold
$
2,255,170
•
•
•
•
•
•
•
Fair Value Measurement Using
Carrying Amount
Fair Value
Level 1
Level 2
Level 3
$
3,869,108
$
3,869,108
$
—
$
3,869,108
$
—
$
772,182
$
772,182
$
772,182
$
—
$
—
Table of Contents
Notes to Condensed Unaudited Financial Statements
Table of Contents
Notes to Condensed Unaudited Financial Statements
$
39,435,848
27,822,917
3,330,000
20,812
70,609,577
8,168,253
$
62,441,324
$
8,168,253
8,692,613
9,230,339
9,809,216
34,709,156
$
70,609,577
Table of Contents
Notes to Condensed Unaudited Financial Statements
Capital
Operating
Total
$
8,184
$
1,084,800
$
1,092,984
8,928
1,084,800
1,093,728
5,208
1,078,280
1,083,488
—
622,714
622,714
22,320
3,870,594
3,892,914
(1,508
)
—
(1,508
)
$
20,812
$
3,870,594
$
3,891,406
Table of Contents
Notes to Condensed Unaudited Financial Statements
2010
2009
$
(3,610,947
)
$
(4,978,498
)
(258,161
)
(68,073
)
$
(3,869,108
)
$
(5,046,571
)
2010
2009
$
(4,131,549
)
$
(1,753,198
)
262,441
(3,293,373
)
$
(3,869,108
)
$
(5,046,571
)
2010
2009
$
6,456,611
$
(2,435,132
)
(258,161
)
(68,073
)
$
6,198,450
$
(2,503,205
)
Table of Contents
Notes to Condensed Unaudited Financial Statements
2010
2009
$
17,243,436
$
(6,125,939
)
262,441
(3,293,373
)
$
17,505,877
$
(9,419,312
)
Table of Contents
Item 2.
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
Table of Contents
•
•
•
•
Table of Contents
Three Months Ended
Three Months Ended
Statement of Operations
March 31, 2010 (Unaudited)
March 31, 2009 (Unaudited)
Data
Amount
Percent
Amount
Percent
$
54,805,570
100.00
%
$
47,664,537
100.00
%
$
46,194,728
84.29
%
$
48,309,527
101.35
%
$
8,610,842
15.71
%
$
(644,990
)
(1.35
)%
$
958,083
1.75
%
$
1,015,606
2.13
%
$
7,652,759
13.96
%
$
(1,660,596
)
(3.48
)%
$
(1,196,148
)
(2.18
%)
$
(774,536
)
(1.63
)%
$
6,456,611
11.78
%
$
(2,435,132
)
(5.11
)%
Table of Contents
Three Months Ended
Three Months Ended
March 31, 2010
March 31, 2009
Revenue Source
Amount
% of Revenues
Amount
% of Revenues
$
45,694,615
83.38
%
$
39,928,725
83.77
%
8,684,689
15.85
%
7,484,085
15.70
%
31,903
0.06
%
33,818
0.07
%
394,360
0.72
%
217,909
0.46
%
$
54,805,570
100.00
%
$
47,664,537
100.00
%
Three Months ended
Three Months ended
March 31, 2010
March 31, 2009
27,886,134
24,810,575
83,776
74,507
$
1.64
$
1.61
$
99.15
$
100.90
10,011,076
8,381,110
819,705
753,062
$
3.74
$
4.08
$
5.93
$
5.40
$
0.055
$
0.068
$
0.041
$
0.029
$
0.029
$
0.029
$
0.017
$
0.019
Table of Contents
Table of Contents
Table of Contents
Six Months Ended
Six Months Ended
Statement of Operations
March 31, 2010 (Unaudited)
March 31, 2009 (Unaudited)
Data
Amount
Percent
Amount
Percent
$
118,355,441
100.00
%
$
71,686,402
100.00
%
$
96,793,063
81.78
%
$
74,737,350
104.26
%
$
21,562,378
18.22
%
$
(3,050,948
)
(4.26
)%
$
1,861,936
1.57
%
$
1,611,979
2.25
%
$
19,700,442
16.65
%
$
(4,662,927
)
(6.51
)%
$
(2,457,006
)
(2.08
)%
$
(1,463,012
)
(2.04
)%
$
17,243,436
14.57
%
$
(6,125,939
)
(8.55
)%
Table of Contents
Six Months Ended
Six Months Ended
March 31, 2010
March 31, 2009
Revenue Source
Amount
% of Revenues
Amount
% of Revenues
$
100,668,434
85.06
$
59,283,890
82.70
$
16,361,378
13.82
$
12,063,374
16.83
$
68,912
0.06
$
75,769
0.10
$
1,256,717
1.06
$
263,369
0.37
$
118,355,441
100.00
$
71,686,402
100.00
Six Months ended
Six Months ended
March 31, 2010
March 31, 2009
56,137,281
38,162,230
166,481
114,838
$
1.79
$
1.55
$
98.69
$
105.71
20,270,512
14,477,456
1,653,182
1,241,239
$
3.82
$
4.09
$
5.27
$
6.05
$
0.059
$
0.074
$
0.043
$
0.036
$
0.030
$
0.030
$
0.018
$
0.028
Table of Contents
Table of Contents
March 31, 2010
September 30, 2009
$
30,015,777
$
22,049,914
$
16,485,848
$
13,036,275
$
83,224,514
$
66,594,997
2010
2009
$
14,462,322
(17,980,424
)
$
(840,052
)
(12,846,947
)
$
(15,096,643
)
30,380,055
$
(1,474,373
)
(447,316
)
$
5,790,752
14,219
Table of Contents
Table of Contents
Table of Contents
Table of Contents
Item 3.
Table of Contents
Outstanding Variable Rate
Interest Rate at
Adverse 10% change in
Annual Adverse change to
Debt at March 31, 2010
March 31, 2010
Interest Rates
Income
5.0%
0.5%
$165,000
Table of Contents
Estimated Volume
Hypothetical
Requirements for the next 12
Adverse Change in
Approximate
months (net of forward and
Price as of
Adverse Change to
futures contracts)
Unit of Measure
1/31/2010
Income
2,700,000
MMBTU
10
%
$
1,209,000
107,000,000
Gallons
10
%
$
16,478,000
34,900,000
Bushels
10
%
$
12,040,500
Item 4T.
Table of Contents
33
34
Item 1.
Item 1A.
Item 2.
Item 3.
Item 4.
Item 5.
Table of Contents
Directors Elected to Serve until 2013
For
Withheld/Abstain
4,156
989
5,082
63
Item 6.
Exhibit
No.
Description
Method
of
Filing
10.1
*
10.2
*
10.3
*
31.1
*
31.2
*
32.1
*
32.2
*
(*)
CARDINAL ETHANOL, LLC
Date: May 14, 2010
/s/ Jeff Painter
Jeff Painter
Chief Executive Officer and President (Principal
Executive Officer)
Date: May 14, 2010
/s/ William Dartt
William Dartt
Chief Financial Officer
(Principal Financial and Accounting Officer)
| 1. |
Unless otherwise defined herein, the capitalized terms used herein shall have the
meaning ascribed to them in the Agreement.
|
| 2. |
A new Paragraph 11 is hereby added to the Agreement which shall state as follows:
|
| 3. |
Except as specifically amended hereby, Buyer and Seller hereby ratify the terms and
conditions of the Agreement as if restated herein.
|
| 4. |
This Amendment and the Agreement, as amended, represent the entire understanding
between the parties in relation to the subject matter hereof, and supersede any and all
previous agreements, arrangements or discussions between the parties (whether written or
oral) in respect to the subject matter hereof.
|
| SELLER: | BUYER: | |||||||||
|
|
||||||||||
| ICM, Inc. | Cardinal Ethanol, LLC | |||||||||
|
|
||||||||||
|
By:
|
/s/ Dave VanderGriend
|
By: |
/s/ Jeffrey L. Painter
|
|||||||
Page 2 of 2
| 1. |
Definitions:
|
| (a) |
Cardinal Ethanol Plant
— The ethanol production
facility and related operations constructed on the premises of Cardinal
Ethanol in Union City, Indiana which will produce as a by-product quantities of
CO
2
Gas.
|
| (b) |
CO
2
Gas
— means the raw carbon dioxide gas
produced as a byproduct of the Cardinal Ethanol Plant and provided to the EPCO
Plant for production of Liquid CO
2
.
|
| (c) |
Contract Year
— Shall mean each twelve (12) month period during the term hereof
beginning on the first day of the first month after the EPCO Plant begins producing Liquid
CO
2
.
|
| (d) |
EPCO Plant
— The carbon dioxide liquefaction plant to
be constructed by EPCO on the leased premises and any future expansion of the
CO2 plant.
|
| (e) |
Flow Rate
— The rate of flow of CO
2
Gas from
the Cardinal Ethanol Plant to the Matchpoint.
|
| (f) |
Liquid CO
2
— means the finished purified,
liquefied product produced by EPCO from the CO
2
Gas supplied by
Cardinal Ethanol.
|
| (g) |
Matchpoint
— The flange or other point on the necessary
services and process facility conduits into and out of the EPCO Plant site and
shown on Attachment 1 of
Exhibit B
. The Matchpoint shall be located in
a mutually agreed upon location as near as practical to the boundary of the
leased premises.
|
| (h) |
Shipped Tons
— means those short tons of Liquid
CO
2
shipped out of the EPCO Plant by
weight. Shipped Tons shall be determined by certified truck or rail scales
located on the EPCO Plant site and EPCO’s bills of lading which will be
provided to Cardinal Ethanol on a daily basis and, upon request by Cardinal
Ethanol, in a monthly cumulative report.
|
| (i) |
Specifications
— means the minimum (or maximum as the
case may be) acceptable specifications for the make up and contents of the
CO
2
Gas as set forth on
Exhibit A
hereto.
|
| 2. |
Term
:
|
| (a) |
The initial term of this Agreement shall be for ten (10) years
effective on the startup date of the EPCO Plant which date shall be no later
than June 1, 2010 unless otherwise agreed by the Parties. This Agreement shall
automatically renew for two (2) additional five (5) year periods thereafter
unless either Party terminates the Agreement by providing at least six (6)
months written notice prior to termination of the initial term or termination
of any renewal period thereafter.
|
| (b) |
Notwithstanding
Subsection (a)
hereof, it is the
intention of the Parties that the term of this Agreement shall not exceed the
term of the Lease Agreement (defined below); accordingly, upon termination of
the Lease Agreement, this Agreement shall also terminate, unless otherwise
agreed in writing by the Parties. The Lease Agreement is the Non-exclusive
CO
2
Facility Site Lease Agreement attached hereto and made a part
hereof and is identified as
Exhibit B
.
|
| 3. |
Quantity and Price
:
|
| (a) |
Cardinal Ethanol will supply to EPCO at the Matchpoint (at 5
p.s.i.g.) CO
2
Gas at a consistent Flow Rate sufficient for EPCO to
produce 6.25 tons of Liquid CO
2
per hour as measured pursuant to
Section 5 on a consistent basis 350 days per year or approximately 150 tons of
Liquid CO2 per day. Cardinal Ethanol is allowed 15 days each Contract Year for
scheduled or unscheduled maintenance and repairs to the Cardinal Ethanol Plant
“downtime”. A day of downtime will be counted for every day in which the
Cardinal Ethanol Plant is not operational for at least twelve hours or is
providing CO2 Gas which does not meet Specifications for at least twelve hours.
For Cardinal Ethanol’s downtime over the 15 days allowed, if the downtime
continues for more than three (3) consecutive days, beginning with the
4
th
consecutive day, EPCO will be provided a credit against the
quantity purchased under Section 5 which shall be the greater of: a) 130 tons
per day for each day of downtime; or b) the number of tons determined by
dividing the total actual extra expense incurred by EPCO as a direct result of
such downtime (the “Actual Expense”) by the applicable price per ton in Section
3(b) (the “CO2 Credit”). EPCO shall provide complete written documentation of
such actual extra expense to Cardinal Ethanol on a monthly basis to
substantiate any claimed CO2 Credit under this section. The Parties agree
that the calculation of the Actual Expense shall be consistent with the sample
calculation attached hereto as Exhibit C. EPCO’s take or pay obligation shall
also be abated as described in and in accordance with the calculation provided
in Section 4.
|
2
| (b) |
The price of CO
2
Gas shall be $5.00 per ton as
measured each month according to Section 5(a). In the event EPCO expands the
EPCO Plant, the CO2 price shall be increased $1.00/ton for every 100 tons/day
of additional capacity added. The new price will be effective and applied to
all tons supplied, not just the incremental capacity added.
|
| (c) |
EPCO shall meet all applicable legal requirements concerning
the release of CO
2
Gas in its possession that are in force during
the term and, whether a legal requirement or not, EPCO shall use commercially
reasonable efforts to prevent venting of CO
2
Gas and to maximize
recovery of condensation.
|
| (d) |
EPCO shall have the option during the initial term of this
Agreement or any extension thereof, to expand the EPCO Plant. In the event
EPCO expands the EPCO Plant, the Parties will mutually agree upon any increase
in the quantity of CO2 Gas to be supplied at that time taking in to account the
total volume of CO2 Gas needed on a daily basis by EPCO and the total supply of
CO2 Gas available from Cardinal Ethanol. Cardinal Ethanol will use its best
efforts to supply the additional volume mutually agreed upon. Pricing and
measurement for any additional tons agreed upon shall be the same as stated in
section 3 (b) and section 5 (a).
|
| 4. |
Take or Pay Minimum
:
|
| (a) |
During the term of this agreement EPCO agrees to pay Cardinal
Ethanol for a minimum of 40,000 tons each Contract Year of the Agreement or
approximately $200,000 annually (the “take or pay obligation”). This minimum
quantity is based on a consistent flow of CO2 Gas from the ethanol source. The
take or pay obligation will be “trued” up or determined on an annual basis.
Within 15 days of the end of the applicable Contract Year, the parties shall
determine any shortfall in the take or pay obligation. If there is a
shortfall, EPCO shall pay the difference in the total amount paid during the
year and its take or pay obligation within 30 days of the end of the applicable
Contract Year. In the event EPCO expands the EPCO Plant, the take or pay
amount shall be increased by 70% of the additional CO2 plant capacity added.
The take or pay amount shall also be at the new CO2 price as determined by
Section 3 (b) above.
|
| (b) |
EPCO’s obligation to take or pay shall abate beginning on the
fourth consecutive day that EPCO is ready and able to “take” CO
2
Gas, but is unable to do so because (i) there exists a force majeure
event affecting Cardinal Ethanol; (ii) there is a day of downtime as described
in Section 3(a) over the 15 days allowed; (iii) the Flow Rate that can be
provided by Cardinal Ethanol to EPCO falls below an amount sufficient for EPCO
to produce the applicable take or pay quantity on a tons of Liquid CO2 per hour
basis as set forth in 3(a); (iv) there has been a cessation of ethanol
production at the Cardinal Ethanol Plant; or (v) there exists a force majeure
event affecting EPCO. For purposes of this
Section 4(b)
, occurrences
of any of the conditions set forth in items (i)-(v) hereof existing for periods
of more than 12 hours in one day shall abate the take or pay obligation for the
entire day that such condition existed. For purposes of this section EPCO’s
take or pay obligation will be based on 114 tons/day (40,000 tons divided by
350 days). The take or pay obligation will be determined by multiplying the
number of daily occurrences of the events in (4b i-v) times 114 tons/day and
subtracting that result from 40,000 tons and multiplying by the applicable
price per ton in Section 3(b). Notwithstanding the foregoing, EPCO shall be
entitled to an abatement of the take or pay obligation only to the extent that
the Shipped Tons for the applicable Contract Year are less than 40,000.
|
| 5. |
Measurement/Quality
:
|
| (a) |
Subject to section 4(a) above, the quantity of
CO
2
Gas purchased by EPCO from Cardinal Ethanol shall be
measured by the number of Shipped Tons, as determined on truck and/or rail
scales located at the EPCO Plant. Cardinal Ethanol shall have the right to
audit EPCO’s truck and rail scales at its expense. The Parties recognize
there is no value of the
CO2 sent to EPCO unless it is sold to customers.
|
3
| (b) |
EPCO will furnish certified bills of lading or other
suitable records of daily production to
Cardinal Ethanol on a daily
basis which shall provide notes relative to the quality and quantity of
CO
2
Gas and, upon request of Cardinal Ethanol, in a monthly
cumulative report. Such records may omit the customer names and addresses
but shall establish the number of Shipped Tons.
|
| (c) |
EPCO agrees to monitor the CO
2
Gas quality
at its own expense to determine if the CO
2
Gas meets
Specifications and agrees to promptly inform Cardinal Ethanol if it does
not.
|
| (d) |
Cardinal Ethanol represents and warrants that the
CO
2
Gas provided shall meet the Specifications set forth on
Exhibit A
. If there is a dispute as to whether the CO2 Gas meets
Specifications, EPCO will have an independent testing lab test the gas for
conformance and their decision will be binding on both parties. If the
test results find that the CO2 Gas is non-conforming, Cardinal Ethanol will
be responsible for the independent testing lab charges. The independent
lab shall be chosen by agreement of both Parties.
|
| (e) |
EXCEPT AS SPECIFICALLY PROVIDED IN THIS AGREEMENT,
CARDINAL ETHANOL MAKES NO WARRANTIES OR REPRESENTATIONS, EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION, ANY WARRANTIES OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE.
|
| 6. |
Payment and Terms
:
|
| 7. |
Utilities
|
| 8. |
Force Majeure
:
|
| (a) |
Neither Party shall be liable for failure to perform or for
delay in performing this Agreement where such failure or delay is occasioned by
events constituting force majeure, and the Parties shall use all reasonable
efforts to minimize the duration of any event of force majeure. For purposes
of this Agreement “force majeure” shall include the following: (i) fire,
explosion, strike, lock-out, labor dispute, casualty, accident or mechanical
failure(s); (ii) lack or failure in whole or in part of transportation
facilities; (c) storm, flood or drought; (iii) acts of God or of the public
enemy, war, riots, police action, or civil commotion; (iv) any law, regulation,
ordinance, demand, judgment, injunction, arbitral award, or other requirement
or regulation of any federal, Indiana, or local government or government
agency; and (v) any other act whatsoever, whether similar or
dissimilar to those above enumerated, beyond the reasonable control of the
party suffering such event of force majeure.
|
4
| (b) |
The Party asserting that an event of force majeure has occurred
shall send or deliver to the other Party prompt written notice thereof setting
forth a description of the event of force majeure, an estimate of its effect
upon the Party’s ability to perform its obligations under this Agreement and
the duration thereof. The notice shall be supplemented by such other
information or documentation as the Party receiving the notice may reasonably
request. As soon as possible after the cessation of any event of force
majeure, the Party which asserted such event shall give the other Party written
notice of such cessation. Whenever possible, each Party shall give the other
Party notice of any threatened or impending event of force majeure, and the
Parties shall use all reasonable efforts to minimize the duration of any event
of force majeure. If either Party has a force majeure event which lasts for
more than ninety (90) days, either Party shall have the option to terminate
this Agreement.
|
| (c) |
It is agreed that if either the Cardinal Ethanol Plant or the
EPCO Plant is destroyed by a force majeure event, the affected Party shall not
be required to rebuild its facility and this Agreement will be terminated
without penalty.
|
| 9. |
Delivery of Product/Utilities
.
|
| (a) |
The CO
2
Gas piping and water supply/return piping from the Cardinal Ethanol
Plant to the match point will be installed by EPCO. EPCO will split out the costs associated
with the installation on Cardinal Ethanol’s side of the match point. Cardinal Ethanol has the
option to have this work done by EPCO, or to have its own contractors do the work. If
Cardinal Ethanol’s contractors perform the work, the CO2 credit below will not be applicable.
If EPCO performs the work on Cardinal Ethanol’s side of the matchpoint, the cost shall be
reimbursed to EPCO via a CO2 credit of $2/ton until the total capital cost is recouped.
After installation, Cardinal Ethanol will be responsible for maintaining the CO2 and water
lines on its side of the match point. EPCO will be responsible for the operation and
maintenance of the CO2 and water piping on its side of the match point. EPCO will also own
and operate the blower supplying the EPCO Plant.
|
| (b) |
Title to and risk of loss of CO
2
Gas shall pass from
Cardinal Ethanol to EPCO at the Matchpoint, but the quantity of CO
2
Gas sold and purchased hereunder shall nonetheless be measured in accordance
with
Section 5a
hereof.
|
| (c) |
Each Party will be responsible for any clean-up which is
necessary due to a spill or leak from that portion of the pipeline which it is
required to maintain. Notwithstanding the foregoing, if one Party is solely
responsible for physical damage to the portion of the pipeline located on the
other’s premises, the former shall be liable for damages caused to the pipeline
and for other directly related damages, such as, but not limited to, clean-up
expenses, and shall take prompt, appropriate, corrective action.
|
| 10. |
Damages/Indemnification/Warranties
.
|
| (a) |
EPCO shall indemnify, defend and hold harmless Cardinal Ethanol
from and against any and all claims, loss, costs, expenses, damages, liability
(including attorneys’ fees and expenses) arising from EPCO’s violation of any
law, rule or regulation (including but not limited to any environmental law,
rule or regulation) as well as any use of the leased premises, or from the
conduct of EPCO’s business (including, but not limited to, any product
liability claims arising therefrom) or from any activity, work or things done,
permitted or suffered by EPCO in or about the leased premises, or arising from
any negligence of EPCO, or any of EPCO’s customers, invitees, contractors,
occupants, or employees, and from and against all loss, damage, liability,
costs, attorneys’ fees, costs
|
5
| (b) |
Cardinal Ethanol shall be responsible, hold harmless, indemnify
and defend EPCO for property damage or personal injury liability caused by the
negligence or willful misconduct of Cardinal Ethanol at the Cardinal Ethanol
Plant, provided, however, that Cardinal Ethanol shall have no obligation under
this Section 10(b) for property damage or personal injury arising directly or
indirectly from the willful misconduct or negligent acts of EPCO, or its
agents, employees or contractors.
|
| (c) |
EPCO warrants and agrees to comply with any and all Indiana and
federal laws including licensing requirements. EPCO will undertake, at its
sole cost and expense, all actions which may be necessary or required to
comply, with all federal, Indiana, and local laws, rules and regulations
related to the use, condition, or occupancy of the EPCO Plant site or the
construction of improvements thereon.
|
| 11. |
Confidentiality and Non-Competition
:
|
| (a) |
The Parties hereby acknowledge that in the course of engaging
in the sale and purchase of CO
2
Gas contemplated by this Agreement,
each will have access to Confidential Information which includes but is not
limited to each other’s business operations, the identity of customers, the
quantity of Liquid CO
2
used by such customers, shipping records,
pricing, customer lists, production methods, technical and non-technical data,
formulae, patterns, compilations, programs, devices, methods, techniques,
drawings, processes, financial data, information regarding actual and potential
customers of each Party and actual and potential suppliers of each Party. The
Parties agree that all such Confidential Information shall be kept secret and
confidential. Notwithstanding the foregoing, the confidentiality obligations of
the receiving Party shall not extend to information that:
|
| A. |
is, as of the time of its disclosure, or
thereafter becomes part of the public domain through a source other
than receiving Party;
|
| B. |
was known by the receiving Party as of the time
of its disclosure;
|
| C. |
is independently developed by the receiving
Party;
|
| D. |
is subsequently learned from a third party not
under a confidentiality obligation; or
|
| E. |
is required to be disclosed pursuant to court
order or government authority, whereupon the receiving Party shall
provide advance notice to the disclosing Party prior to such
disclosure.
|
| (b) |
The Parties further acknowledge that violation of the provisions of this
Section shall constitute irreparable injury and shall entitle the non-violating
Party to temporary preliminary and/or permanent injunctive relief, in addition
to any other remedy at law or in equity.
|
6
| (c) |
During the term of this Agreement, Cardinal Ethanol will not
market, sell, provide, or attempt to market, sell, or provide raw CO
2
Gas or liquefied CO
2
Gas from Cardinal Ethanol’s ethanol
facility in ( Union City), ( Indiana) to any other end user or party except as
provided herein. In the event Cardinal Ethanol expands its ethanol facility,
thereby making additional quantities of raw CO2 gas available, EPCO shall have
the right of first refusal on any and all additional quantities of raw gas.
EPCO shall not be obligated to take or pay for any such additional quantities
of raw gas unless taken. If additional quantities are offered and not taken by
EPCO, Cardinal Ethanol may sell such additional quantities of raw gas to
another end user or party.
|
| 12. |
Insurance
: EPCO shall furnish Cardinal Ethanol certificates of
insurance with thirty (30) days notice of cancellation and/or change in coverage clause
as evidence of the following coverages with respect to the EPCO Plant:
|
| (a) |
Worker’s Compensation as prescribed by law and Employer’s
Liability Insurance with a limit of not less than $1,000,000 per person and
$1,000,000 per accident;
|
| (b) |
Comprehensive Public Liability and Automobile Liability,
including broad form contractual liability provision to cover any liability
assumed by EPCO under this Agreement, with a combined single limit of
$5,000,000 Property Damage and Bodily Injury.
|
| 13. |
Assignment
: Subject to the terms and conditions set forth herein, no
assignment by the Parties of all or part of its rights and obligations shall be made
without the consent of the non-assigning Party, which consent shall not be unreasonably
withheld. Notwithstanding the foregoing, in the event Cardinal Ethanol sells the
Cardinal Ethanol Plant, EPCO may, at its sole option, terminate this Agreement without
any penalty.
|
| 14. |
Termination:
Either Party may, at its option, terminate this Agreement
in the event of an uncured material breach of this Agreement by the other party. Such
termination may be effected only through written notice to the breaching Party, which
notice shall specify the breach on which termination is based. Following receipt of
such notice, the breaching Party shall have ninety (90) days to cure such breach.
Provided however, that in the event of a failure to pay amounts payable by EPCO under
this Agreement, EPCO shall have twenty (20) days following receipt of written notice to
cure said breach. The Agreement shall terminate, on notice given by the non-breaching
party, in the event such cure is not affected by the end of the applicable period, or
longer period as determined by the non-breaching party.
|
| 15. |
Entire Agreement
: This Agreement and the Lease Agreement contain the
entire agreement between the Parties with respect to the subject matter herein, and
there are no oral promises, representations, or other warranties affecting them. No
amendment or modifications of any of the terms and provisions of this Agreement shall
be binding upon either Cardinal Ethanol or EPCO unless the same be expressed in writing
and signed by both Parties.
|
7
| 16. |
Miscellaneous
:
|
| (a) |
Headings are for reference only, and do not affect the meaning
of any paragraph.
|
| (b) |
Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
|
| (c) |
The failure of either Party to require strict compliance with
any of the terms and conditions of this Agreement in any one situation shall
not constitute a waiver of any of the terms and conditions of this Agreement.
|
| (d) |
EPCO acknowledges that Cardinal Ethanol is a tobacco free
workplace. The smoking, chewing, or dipping of any tobacco product is strictly
prohibited on the premise. It is also the policy of Cardinal Ethanol to
maintain a drug free workforce and workplace. The use, possession,
manufacture, distribution, dispensation, sale or purchase of an illegal drug or
beverage alcohol by any employee at any time is prohibited. EPCO also
acknowledges that Cardinal Ethanol bans firearms and any other weapons on its
property. EPCO agrees that EPCO and its employees will comply with these and
all other policies of Cardinal Ethanol. EPCO also agrees that all employees of
Cardinal Ethanol and EPCO will use the parking lot east of the Cardinal Ethanol
administration building for vehicle transportation to and from work.
|
| 17. |
Notices
: Notices and other communications between the Parties hereto
shall be in writing (by mail, telex, telecopy or telegraph unless a particular mode is
specified herein), postage or transmission costs prepaid, and shall be addressed to the
Parties hereto the addresses set forth below:
|
8
| 18. |
Governing Law, Forum and Jurisdiction.
The validity, construction and
enforcement of this Agreement shall be determined in accordance with the laws of
(Indiana), without reference to its conflicts of laws principles, and any action
arising under this Agreement shall be brought exclusively in (Indiana). Both parties
consent to the personal jurisdiction of the Indiana courts located in (Indiana) and
federal courts located in (Indiana).
|
| 19. |
Contingency. Not applicable.
|
9
| Attest: | EPCO CARBON DIOXIDE PRODUCTS, INC. | |||||||
|
|
||||||||
|
/s/ Denise Wiesemann
|
BY: |
/
s/ Darrell Craft 3-8-10
|
||||||
|
|
||||||||
| Attest: | CARDINAL ETHANOL, LLC | |||||||
|
|
||||||||
|
/s/ Tom Chalfant
|
BY: |
/s/ Jeffrey Painter 3-10-10
|
||||||
10
| Description | Specification | |
|
CO2
|
99.0% (mol) | |
|
O2
|
6,000 PPM | |
|
N2
|
24,000 PPM | |
|
Ethanol
|
200 PPM maximum | |
|
Acetaldehyde
|
50 PPM maximum | |
|
Dimethyl Sulfide
|
1 PPM maximum | |
|
Other Hydrocarbons
|
20 PPM maximum | |
|
SO2
|
10 PPM maximum | |
|
COS
|
10 PPM maximum | |
|
H2S
|
10 PPM maximum | |
|
Total Sulfur
|
40 PPM maximum | |
|
Tenperature
|
100 degrees F at the Matchpoint at 5 p.s.i.g. |
|
Signed:
Date: |
/s/ Darrel Craft
|
|
Signed:
Date: |
/s/ Jeffrey Painter
|
|
Signed:
Date: |
/s/ Darrel Craft
|
|
Signed:
Date: |
/s/ Jeffrey Painter
|
Extra Expense Calculation
Normal
Applicable
Extra
Product Costs
$/Ton
Actual
Diff
Tons/$
Expense
Comment
5.00
5.70
10.70
187.88
8.18
260.00
$
2,126.00
See detail below on $18.88
1,857
2,500
$
707.30
$1.10 = EPCO Variable trasnp. Cost.
(Diesel, Driver Pay, Var. Maint.)
$
2,833.30
$
5.00
567
Ton
$/Ton
Amount
60
40.00
2,400.00
140
7.20
1,008.00
See detail Below
60
25.00
1,500.00
260
18.88
4,908.00
4.00
3.20
7.20
Date:
/s/ Darrel Craft
Date:
/s/ Jeffrey Painter
| a. |
Twenty-five percent (25%) of the Contract Sum or four hundred thirty-six
thousand five hundred dollars ($436,500.00) shall be due upon execution of this
Agreement.
|
| b. |
Contractor shall provide an invoice to Owner not later than the Thirtieth (30)
day of each month. The invoice shall indicate the percentage of completion of the
construction of the Bin as of the end of the period covered by the invoice. Owner shall
have fifteen (15) business days to pay the percentage of the Contract Sum equal to the
percentage of completion of construction of the Bin since the previous invoice.
|
| c. |
The entire Contract Sum shall be paid in full no later than thirty (30) days
after the Completion of Construction.
|
| d. |
The Owner may adjust or reject an invoice or nullify a previously approved
invoice, in whole or in part, as may reasonably be necessary to protect the Owner from
loss or damage based upon the following:
|
| i. |
Contractor’s failure to construct the Bin as
required by this Agreement and the Specifications;
|
| ii. |
loss or damage arising out of or relating to
this Agreement and caused by the Contractor to the Owner, or others to
whom the Owner may be liable;
|
| iii. |
the Contractor’s failure to pay the
Architect/Engineer or Subcontractors for labor, materials, equipment or
supplies properly furnished in connection with the construction of the
Bin, provided that the Owner is making payments to the Contractor in
accordance with the terms of this Agreement;
|
| iv. |
defective work not corrected in a timely
fashion; and
|
| v. |
reasonable evidence demonstrating that the
unpaid balance of the Contract Sum is insufficient to fund the cost to
complete the construction of the Bin.
|
| a. |
If the Completion of Construction does not take place on or before October 1,
2010, Contractor shall pay to the Owner five thousand dollars ($5,000).
|
| b. |
If the Completion of Construction does not take place on or before October 8,
2010, Contractor shall pay to the Owner ten thousand dollars ($10,000).
|
| c. |
If the Completion of Construction does not take place on or before October 15,
2010, Contractor shall pay to the Owner fifteen thousand dollars ($15,000).
|
| d. |
If the Completion of Construction does not take place on or before October 22,
2010, Contractor shall pay to the Owner twenty-five thousand dollars ($25,000).
|
| e. |
If the Completion of Construction does not take place on or before October 29,
2010, Contractor shall pay to the Owner forty thousand dollars ($40,000).
|
| f. |
If the Completion of Construction does not take place on or before November 5,
2010, Contractor shall pay to the Owner fifty-five thousand dollars ($55,000).
|
| g. |
If the Completion of Construction does not take place on or before November 12,
2010, Contractor shall pay to the Owner sixty thousand dollars ($60,000).
|
| h. |
If the Completion of Construction is after November 12, 2010, Contractor shall
pay to the Owner seventy-five thousand dollars ($75,000).
|
| a. |
Suspension by the Owner for Convenience.
|
| i. |
The Owner may order the Contractor, in writing, to
suspend, delay or interrupt all or any part of the construction of the Bin
without cause for such period of time as the Owner may determine to be
appropriate for its convenience.
|
| ii. |
Adjustments caused by suspension, delay or interruption
shall be made for increases in the Contract Sum and/or the date of
completion. No adjustment shall be made if the Contractor is or otherwise
would have been responsible for the suspension, delay or interruption of
the construction of the Bin, or if another provision of this Agreement is
applied to render an equitable adjustment.
|
| b. |
Owner’s Right to Perform Contractor’s Obligations and Termination by the Owner
for Cause.
|
| i. |
If the Contractor persistently fails to perform any of
its obligations under this Agreement, the Owner may, after five (5) days’
written notice, during which period the Contractor fails to perform such
obligation, undertake to perform such obligations. The Contract Sum shall
be reduced by the cost to the Owner of performing such obligations.
|
| ii. |
Upon five (5) days’ written notice to the Contractor
and the Contractor’s surety, if any, the Owner may terminate this Agreement
for any of the following reasons:
|
| 1. |
if the Contractor utilizes
improper materials and/or inadequately skilled workers;
|
| 2. |
if the Contractor does not make
proper payment to laborers, material suppliers or contractors
provided that the Owner is making payments to the Contractor in
accordance with the terms of this Agreement;
|
| 3. |
if the Contractor fails to abide
by the orders, regulations, rules, ordinances or laws of
governmental authorities having jurisdiction; or
|
| 4. |
if the Contractor otherwise
materially breaches this Agreement.
|
| iii. |
If the Contractor fails to cure or commence and
continue to cure within the five (5) days, the Owner, without prejudice to
any other right or remedy, may take possession of the worksite and complete
the construction of the Bin utilizing any reasonable means. In this event,
the Contractor shall not have a right to further payment until the
Completion of Construction.
|
| iv. |
If the Contractor files a petition under the Bankruptcy
Code, this Agreement shall terminate if the Contractor or the Contractor’s
trustee rejects the Agreement or, if there has been a default, the
Contractor is unable to give adequate assurance that the Contractor will
perform as required by this Agreement or otherwise is unable to comply with
the requirements for assuming this Agreement under the applicable
provisions of the Bankruptcy Code.
|
| c. |
Termination by Owner Without Cause. If the Owner terminates this Agreement other
than as set forth in Section 12(b) herein, the Owner shall pay the Contractor for all
completed construction work on the Bin and for all proven loss, cost or expense in
connection with the construction of the Bin and the Contractor shall have no other
remedy, including but not limited to incidental or consequential damages, against the
Owner.
|
| Cardinal Ethanol, LLC | LAH Development, LLC | |||||||||
|
|
||||||||||
|
By:
|
/s/ Jeffrey L. Painter
|
By: |
/s/ Sy Hart
|
|||||||
|
|
5/11/2010 | |||||||||
| • |
Nu Way to supply design drawings
|
||
| • |
Finish design will be approved by owner (Cardinal Ethanol, LLC) prior to start of
project
|
| • |
Excavate for bin footer and walls (dirt left on property)
|
||
| • |
13′ x 2′5″ footer
|
||
| • |
10′ high x 18″ wide exterior wall
|
||
| • |
8′ x 8′ access tunnel
|
||
| • |
Quad “F” aeration floor
|
||
| • |
Stone and compaction
|
||
| • |
Required concrete and rebar
|
| • |
90′ — 10″ Eave height; 119′ — 10″ peak height
|
||
| • |
730,245 bushel capacity
|
||
| • |
25,000 LB. peak load roof
|
||
| • |
2 ring commercial walk in door
|
||
| • |
Inside and outside ladder system
|
||
| • |
Roof stairs
|
||
| • |
10′ peak walk around
|
||
| • |
16′ center discharge with electric gate
|
||
| • |
(10) 12″ intermediate manual gates
|
||
| • |
1/10 CFM/BU Quad “F” aeration monorail flush floor system
|
||
| • |
(4) 30 hp. 3 ph 230/460 V centrifugal fans
|
||
| • |
(45) grill vents
|
||
| • |
(10) 24″ exhausters, 2 hp, 3 ph explosion proof fans
|
||
| • |
(24) temperature cable supports
|
||
| • |
10K BPH series 2 bin sweep (Zero Entry, One Pass sweep)
|
| • |
6′ wide x 125′ handrail truss catwalk w24″ grip strut walkway on one side
|
| • |
(1) 4 legged support tower
|
| • |
(1) 2 legged support tower tied to bin
|
| • |
Support structure at bin top
|
| • |
40,000 BPH GSI En-Masse conveyor
|
| • |
(2) 50 hp, 3 ph TEFC Motors
|
| • |
Duel TA9415 Dodge Reducers
|
| • |
3/16″ AR Bolt on bottom
|
| • |
10 ga. AR side liner
|
| • |
Lined head discharge
|
| • |
Slack chain detection with limit switch
|
| • |
End relief door with limit switch
|
| • |
Transition from new conveyor to new bin
|
| • |
Agri dry spreader system as per request
|
| • |
10,000 BPH GSI En-Masse Conveyor
|
| • |
30hp, 3 ph TEFC motor
|
||
| • |
3/16″ AR bolt on bottom
|
||
| • |
10 ga. AR side liner
|
||
| • |
Lined head discharge
|
||
| • |
Slack chain detection with limit switch
|
||
| • |
End relief door with limit switch
|
| • |
(11) Inlet transitions
|
||
| • |
Lined transition from new conveyor to the existing conveyor
|
| • |
(24) Detection cables with hardware
|
||
| • |
PCI interface with software
|
||
| • |
Control wire
|
||
| • |
Remote Multiplexer
|
||
| • |
Point to point wireless radio
|
||
| • |
Thermocouple lead wires
|
||
| • |
Operation Manual
|
|
PROJECT COST
|
$ | 1,490,000 |
| • |
40,000 GSI Enclosed Belt conveyor
|
| • |
90 ft. c/c
|
||
| • |
40 hp drive system
|
||
| • |
5 deg. Incline
|
||
| • |
1/2″ UHMW bottom liner
|
||
| • |
Plug switch
|
||
| • |
Shaft monitor
|
|
DEDUCT
|
$ | 30,000 |
| • |
Extending the existing bottom unload drag
|
||
| • |
Revising the tunnel height to 6′ — 6″
|
| • |
Extending existing top fill drag with new platform (10′ long with 12′x12′ platform)
Support system from new tower and ladder access to new top catwalk
|
| • |
Two (2) 4 legged support towers
|
| • |
Price increases of equipment.
|
| • |
Motion detection equipment, rub sensors and other applicable safety equipment as
required
|
| • |
Bin Bob level indicator and high level indicator included in pricing.
|
|
Revised Price
|
$ | 1,561,000 |
| • |
Furnish all material, equipment, labor, evaluation/study, etc. that is necessary to
complete the project.
|
|
Electrical Cost
|
$ | 185,000 |
|
Total revised complete project cost
|
$ | 1,746,000 |
| 1. |
I have reviewed this quarterly report on Form 10-Q of Cardinal Ethanol, LLC;
|
| 2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period
covered by this report;
|
| 3. |
Based on my knowledge, the financial statements, and other financial information included in
this report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this
report;
|
| 4. |
The registrant’s other certifying officers and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and have:
|
| a) |
Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly during the period in
which this report is being prepared;
|
| b) |
Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles;
|
| c) |
Evaluated the effectiveness of the registrant’s disclosure controls and
procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this report
based on such evaluation; and
|
| d) |
Disclosed in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent fiscal quarter
(the registrant’s fourth fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
|
| 5. |
The registrant’s other certifying officers and I have disclosed, based on our most recent
evaluation of internal control over financial reporting, to the registrant’s auditors and the
audit committee of the registrant’s board of directors (or persons performing the equivalent
functions):
|
| a) |
All significant deficiencies and material weaknesses in the design or operation
of internal control over financial reporting which are reasonably likely to adversely
affect the registrant’s ability to record, process, summarize and report financial
information; and
|
| b) |
Any fraud, whether or not material, that involves management or other employees
who have a significant role in the registrant’s internal control over financial
reporting.
|
| Date: May 14, 2010 | /s/ Jeff Painter | |||
|
Jeff Painter, Chief Executive
Officer
(President and Principal Executive Officer) |
||||
| 1. |
I have reviewed this quarterly report on Form 10-Q of Cardinal Ethanol, LLC;
|
| 2. |
Based on my knowledge, this report does not contain any untrue statement of a material fact
or omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the period
covered by this report;
|
| 3. |
Based on my knowledge, the financial statements, and other financial information included in
this report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this
report;
|
| 4. |
The registrant’s other certifying officers and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and
15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules
13a-15(f) and 15d-15(f)) for the registrant and have:
|
| a) |
Designed such disclosure controls and procedures, or caused such disclosure
controls and procedures to be designed under our supervision, to ensure that material
information relating to the registrant, including its consolidated subsidiaries, is
made known to us by others within those entities, particularly during the period in
which this report is being prepared;
|
| b) |
Designed such internal control over financial reporting, or caused such
internal control over financial reporting to be designed under our supervision, to
provide reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with generally
accepted accounting principles;
|
| c) |
Evaluated the effectiveness of the registrant’s disclosure controls and
procedures and presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures, as of the end of the period covered by this report
based on such evaluation; and
|
| d) |
Disclosed in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent fiscal quarter
(the registrant’s fourth fiscal quarter in the case of an annual report) that has
materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
|
| 5. |
The registrant’s other certifying officers and I have disclosed, based on our most recent
evaluation of internal control over financial reporting, to the registrant’s auditors and the
audit committee of the registrant’s board of directors (or persons performing the equivalent
functions):
|
| a) |
All significant deficiencies and material weaknesses in the design or operation
of internal control over financial reporting which are reasonably likely to adversely
affect the registrant’s ability to record, process, summarize and report financial
information; and
|
| b) |
Any fraud, whether or not material, that involves management or other employees
who have a significant role in the registrant’s internal control over financial
reporting.
|
| Date: May 14, 2010 | /s/ William Dartt | |||
| William Dartt, Chief Financial Officer | ||||
| (Principal Financial Officer) | ||||
| 1. |
The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended; and
|
| 2. |
The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
|
| /s/ Jeff Painter | ||||
| Jeff Painter, President | ||||
|
and Principal Executive Officer
Dated: May 14, 2010 |
||||
| 1. |
The Report fully complies with the requirements of Section 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended; and
|
| 2. |
The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
|
| /s/ William Dartt | ||||
| William Dartt, | ||||
|
Chief Financial Officer
(Principal Financial Officer) Dated: May 14, 2010 |
||||