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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended October 31, 2013.
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Or
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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for the transition period from to .
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Minnesota
(State or other jurisdiction of
incorporation or organization)
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41-2002393
(IRS Employer
Identification No.)
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Securities registered pursuant to Section 12(b) of
the Act:
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Securities registered pursuant to Section 12(g) of
the Act:
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None
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Class A Units
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Large Accelerated Filer
o
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Accelerated Filer
o
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Non-Accelerated Filer
ý
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Smaller Reporting Company
o
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*
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Refer to the Form 10-K for the fiscal year ended October 31, 2013 and filed with the Securities and Exchange Commission on January 29, 2014.
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(a)
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Financial Statements
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Page
Reference
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Audited Financial Statements
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*
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*
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*
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*
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*
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*
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Refer to the Form 10-K for the fiscal year ended October 31, 2013 and filed with the Securities and Exchange Commission on January 29, 2014.
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(b)
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Exhibits
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HERON LAKE BIOENERGY, LLC
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Date:
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April 23, 2014
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/s/ Steve Christensen
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Steve Christensen
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Chief Executive Officer
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Date:
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April 23, 2014
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/s/ Stacie Schuler
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Stacie Schuler
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Chief Financial Officer
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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3.1
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First Amended and Restated Articles of Organization of Heron Lake BioEnergy, LLC, as amended effective August 30, 2011
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Exhibit 3.1 to Current Report on Form 8-K dated September 2, 2011.
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3.2
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Member Control Agreement of Heron Lake BioEnergy, LLC, as amended through August 30, 2011
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Exhibit 3.2 to Current Report on Form 8-K dated September 2, 2011.
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4.1
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Form of Class A Unit Certificate
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Exhibit 4.1 of the Company's Registration Statement on Form 10 (File No. 000-51825) filed on August 22, 2008 (the "2008 Registration Statement").
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4.2
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Unit Transfer Policy adopted November 5, 2008
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Exhibit 4.1 of the Company's Current Report on Form 8-K dated November 5, 2008.
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4.3
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Indenture dated as of September 18, 2013, by and between Heron Lake BioEnergy, LLC and U.S. Bank National Association
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Exhibit 4.1 of the Company's Current Report on Form 8-K dated September 8, 2013.
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10.1
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Fourth Amended and Restated Loan Agreement dated October 1, 2007 by and between AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC
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Exhibit 10.1 of the Company's 2008 Registration Statement.
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10.2
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Third Supplement dated October 1, 2007 to Fourth Amended and Restated Loan Agreement by and between AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC
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Exhibit 10.2 of the Company's 2008 Registration Statement.
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10.3
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Fourth Supplement dated October 1, 2007 to Fourth Amended and Restated Loan Agreement by and between AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC
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Exhibit 10.3 of the Company's 2008 Registration Statement.
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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10.4
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Term Note dated October 1, 2007 in principal amount of $59,583,000 by Heron Lake BioEnergy, LLC to AgStar Financial Services, PCA as lender
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Exhibit 10.4 of the Company's 2008 Registration Statement.
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10.5
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Term Revolving Note dated October 1, 2007 in principal amount of $5,000,000 by Heron Lake BioEnergy, LLC to AgStar Financial Services, PCA as lender
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Exhibit 10.5 of the Company's 2008 Registration Statement.
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10.6
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Personal Guaranty dated October 1, 2007 by Roland Fagen, guarantor, in favor of AgStar Financial Services, PCA
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Exhibit 10.6 of the Company's 2008 Registration Statement.
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10.7
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Fourth Amended and Restated Guaranty dated October 1, 2007 by Lakefield Farmers Elevator, LLC in favor of AgStar Financial Services, PCA
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Exhibit 10.7 of the Company's 2008 Registration Statement.
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10.8
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Fifth Supplement dated November 19, 2007 to Fourth Amended and Restated Loan Agreement by and between AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC
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Exhibit 10.8 of the Company's 2008 Registration Statement.
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10.9
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Revolving Line of Credit Note dated November 19, 2007 in principal amount of $7,500,000 by Heron Lake BioEnergy, LLC to AgStar Financial Services, PCA as lender
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Exhibit 10.9 of the Company's 2008 Registration Statement.
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10.10
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Industrial Water Supply Development and Distribution Agreement dated October 27, 2003 among Heron Lake BioEnergy, LLC (f/k/a Generation II Ethanol, LLC), City of Heron Lake, Jackson County, and Minnesota Soybean Processors
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Exhibit 10.10 of the Company's 2008 Registration Statement.
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10.11
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Industrial Water Supply Treatment Agreement dated May 23, 2006 among Heron Lake BioEnergy, LLC, City of Heron Lake and County of Jackson
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Exhibit 10.11 of the Company's 2008 Registration Statement.
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10.12
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Standard Form of Agreement between Owner and Designer—Lump Sum dated September 28, 2005 by and between Fagen, Inc. and Heron Lake BioEnergy, LLC†
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Exhibit 10.12 of Amendment No. 4 to the Company's 2008 Registration Statement.
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10.13
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Distiller's Grain Marketing Agreement dated October 5, 2005 by and between Heron Lake BioEnergy, LLC and Commodity Specialist Company as assigned to CHS Inc. as of August 17, 2007
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Exhibit 10.13 of the Company's 2008 Registration Statement.
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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10.14
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Ethanol Fuel Marketing Agreement dated August 7, 2006 by and between RPGM, Inc. and Heron Lake BioEnergy, LLC
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Exhibit 10.14 of the Company's 2008 Registration Statement.
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10.15
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Letter Agreement re: Environmental Compliance Support dated March 12, 2007 by and between Fagen Engineering, LLC Heron Lake BioEnergy, LLC
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Exhibit 10. 15 of the Company's 2008 Registration Statement.
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10.16
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Coal Loading, Transport, and Delivery Agreement effective as of April 1, 2007 by and between Tersteeg Transport Inc. and Heron Lake BioEnergy, LLC
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Exhibit 10.16 of the Company's 2008 Registration Statement.
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10.17
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Coal Transloading Agreement dated June 1, 2007 by and between Southern Minnesota Beet Sugar Cooperative and Heron Lake BioEnergy, LLC†
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Exhibit 10.17 of the Company's 2008 Registration Statement.
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10.18
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Master Coal Purchase and Sale Agreement dated June 1, 2007 by and between Northern Coal Transport Company and Heron Lake BioEnergy, LLC, including confirmation letter dated July 13, 2007†
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Exhibit 10.18 of the Company's 2008 Registration Statement.
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10.19
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Loan Agreement dated December 28, 2007 by and between Federated Rural Electric Association and Heron Lake BioEnergy, LLC
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Exhibit 10.19 of the Company's 2008 Registration Statement.
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10.20
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Secured Promissory Note issued December 28, 2007 by Heron Lake BioEnergy, LLC as borrower to Federated Rural Electric Association as lender in principal amount of $600,000
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Exhibit 10.20 of the Company's 2008 Registration Statement.
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10.21
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Security Agreement dated December 28, 2007 by Heron Lake BioEnergy, LLC in favor of Federated Rural Electric Association
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Exhibit 10.21 of the Company's 2008 Registration Statement.
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10.22
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Electric Service Agreement dated October 17, 2007 by and between Interstate Power and Light Company and Heron Lake BioEnergy, LLC
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Exhibit 10.22 of the Company's 2008 Registration Statement.
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10.23
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Shared Savings Contract dated November 16, 2007 by and between Interstate Power and Light Company and Heron Lake BioEnergy, LLC
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Exhibit 10.23 of the Company's 2008 Registration Statement.
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10.24
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Escrow Agreement dated November 16, 2007 by and between Heron Lake BioEnergy, LLC, Farmers State Bank of Hartland for the benefit of Interstate Power and Light Company
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Exhibit 10.24 of the Company's 2008 Registration Statement.
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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10.25
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Employment Agreement dated February 1, 2008 by and between Heron Lake BioEnergy, LLC and Robert J. Ferguson*
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Exhibit 10.25 of the Company's 2008 Registration Statement.
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10.26
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Compliance Agreement effective January 23, 2007 by and between Heron Lake BioEnergy, LLC and the Minnesota Pollution Control Agency
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Exhibit 10.28 to Amendment No. 1 to the Company's 2008 Registration Statement.
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10.27
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Letter Agreement dated November 25, 2008 by and between Heron Lake BioEnergy, LLC, CFO Systems, LLC and Brett L. Frevert relating to the services of Brett L. Frevert*
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Exhibit 10.1 to Current Report on Form 8-K dated November 26, 2008.
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10.28
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Ethanol Purchase and Marketing Agreement dated September 2, 2009 by and between Heron Lake BioEnergy, LLC and C&N Ethanol Marketing Corporation
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Exhibit 10.1 to Current Report on Form 8-K dated September 2, 2009.
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10.29
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Amendment No. 4 to Fifth Supplement dated December 8, 2009 by and between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.32 to Annual Report on Form 10-K for the year ended October 31, 2009.
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10.30
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Amendment No. 5 to Fifth Supplement to the Master Loan Agreement dated March 25, 2010 by and between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.1 to Current Report on Form 8-K dated March 25, 2010
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10.31
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Amendment No. 6 to Fifth Supplement to the Master Loan Agreement dated May 27, 2010 by and between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.2 to Current Report on Form 8-K dated March 25, 2010
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10.32
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Amended and Restated Fifth Supplement dated as of July 2, 2010 to the Master Loan Agreement by and between AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC
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Exhibit 10.1 to Current Report on Form 8-K dated July 2, 2010
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10.33
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Second Amended and Restated Revolving Line of Credit Note dated July 2, 2010 in the maximum principal amount of $6,750,000 by Heron Lake BioEnergy, LLC as borrower to AgStar Financial Services, PCA as lender
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Exhibit 10.2 to Current Report on Form 8-K dated July 2, 2010
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10.34
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Forbearance Agreement dated July 2, 2010 by and between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.3 to Current Report on Form 8-K dated July 2, 2010
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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10.35
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Mutual Release and Settlement Agreement dated July 2, 2010 among Heron Lake BioEnergy, LLC, Fagen, Inc. and ICM, Inc.†
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Exhibit 10.1 to Current Report on Form 8-K dated July 2, 2010
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10.36
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Subscription Agreement dated July 2, 2010 by Heron Lake BioEnergy, LLC and Project Viking, L.L.C.
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Exhibit 10.1 to Current Report on Form 8-K dated July 2, 2010
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10.37
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First Amendment to Fifth Supplement to the Master Loan Agreement dated as of December 30, 2010 by and between AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC
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Exhibit 10.1 to Current Report on Form 8-K dated December 30, 2010
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10.38
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Third Amended and Restated Revolving Line of Credit Note dated December 30, 2010 in the maximum principal amount of $6,750,000 by Heron Lake BioEnergy, LLC as borrower to AgStar Financial Services, PCA as lender
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Exhibit 10.2 to Current Report on Form 8-K dated December 30, 2010
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10.39
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First Amendment to Forbearance Agreement dated December 30, 2010 by and between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.3 to Current Report on Form 8-K dated December 30, 2010
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10.40
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Fifth Amended and Restated Master Loan Agreement dated to be effective as of September 1, 2011 between AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC†
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Exhibit 10.40 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.41
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Amended and Restated Term Note dated September 1, 2011 in principal amount of $40,000,000 by Heron Lake BioEnergy, LLC to AgStar Financial Services, PCA as lender
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Exhibit 10.41 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.42
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Amended and Restated Term Revolving Note dated September 1, 2011 in principal amount of $8,008,689 by Heron Lake BioEnergy, LLC to AgStar Financial Services, PCA as lender
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Exhibit 10.42 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.43
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Fourth Amended and Restated Mortgage, Security Agreement and Assignment of Rents and Leases dated September 1, 2011 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.43 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.44
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Fifth Amended and Restated Guaranty dated September 1, 2011 by Lakefield Farmers Elevator, LLC in favor of AgStar Financial Services, PCA
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Exhibit 10.44 to Annual Report on Form 10-K for the year ended October 31, 2011.
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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10.45
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Amended and Restated Guaranty dated September 1, 2011 by HLBE Pipeline Company, LLC in favor of AgStar Financial Services, PCA
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Exhibit 10.45 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.46
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Collateral Assignment dated September 1, 2011 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.46 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.47
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Collateral Assignment dated September 1, 2011 between Lakefield Farmers Elevator, LLC and AgStar Financial Services, PCA
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Exhibit 10.47 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.48
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Corn Supply Agreement dated effective as of September 1, 2011 between Heron Lake BioEnergy, LLC and Gavilon, LLC†
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Exhibit 10.48 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.49
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Ethanol and Distiller's Grains Marketing Agreement dated effective as of September 1, 2011 between Heron Lake BioEnergy, LLC and Gavilon, LLC†
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Exhibit 10.49 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.50
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Master Netting, Setoff, Credit and Security Agreement dated effective as of September 1, 2011 between Heron Lake BioEnergy, LLC and Gavilon, LLC†
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Exhibit 10.50 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.51
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Corn Storage Agreement dated effective as of September 1, 2011 between Lakefield Farmers Elevator, LLC, Heron Lake BioEnergy, LLC and Gavilon, LLC
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Exhibit 10.51 to Annual Report on Form 10-K for the year ended October 31, 2011.
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10.52
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Amended and Restated Forbearance Agreement dated January 22, 2013 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.52 to Annual Report of Form 10-K for the year ended October 31, 2012.
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10.53
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Second Amended and Restated Forbearance Agreement dated February 12, 2013 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.1 to Current Report on Form 8-K dated February 12, 2013.
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10.54
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Asset Purchase Agreement dated January 3, 2013, by Heron Lake BioEnergy, LLC, as the sole member and owner of all of the outstanding membership interests of Lakefield Farmers Elevator, LLC, the Seller, and FCA Co-op, the Buyer
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Exhibit 2.1 to Annual Report of Form 10-K for the year ended October 31, 2012.
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10.55
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Asset Purchase Agreement dated January 22, 2013, by and between Heron Lake BioEnergy, LLC and Guardian Energy Heron Lake, LLC
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Exhibit 2.2 to Annual Report of Form 10-K for the year ended October 31, 2012.
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10.56
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Third Amended and Restated Forbearance Agreement dated March 29, 2013 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA †
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Exhibit 10.1 to Current Report on Form 8-K dated March 29, 2013.
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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10.57
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Fourth Amended and Restated Forbearance Agreement dated April 12, 2013 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA †
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Exhibit 10.1 to Current Report on Form 8-K dated April 12, 2013.
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10.58
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Fifth Amended and Restated Forbearance Agreement dated May 10, 2013 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA †
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Exhibit 10.1 to Current Report on Form 8-K dated May 10, 2013.
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10.59
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Sixth Amended and Restated Master Loan Agreement dated to be effective as of May 17, 2013 by and among AgStar Financial Services, PCA and Heron Lake BioEnergy, LLC
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Exhibit 10.1 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.60
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Second Amended and Restated Term Note dated May 17, 2013 in principal amount of $17,404,344 by Heron Lake BioEnergy, LLC to AgStar Financial Services, PCA as lender
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Exhibit 10.2 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.61
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Second Amended and Restated Term Revolving Note dated May 17, 2013 in principal amount of $20,500,000 by Heron Lake BioEnergy, LLC to AgStar Financial Services, PCA as lender
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Exhibit 10.3 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.62
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Sixth Amended and Restated Mortgage, Security Agreement and Assignment of Rents and Leases dated May 17, 2013 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.4 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.63
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Sixth Amended and Restated Guaranty dated May 17, 2013 by Lakefield Farmers Elevator, LLC in favor of AgStar Financial Services, PCA
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Exhibit 10.5 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.64
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Second Amended and Restated Guaranty dated May 17, 2013 by HLBE Pipeline Company, LLC in favor of AgStar Financial Services, PCA
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Exhibit 10.6 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.65
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Form of Subscription Agreement and Subordinated Loan Agreement dated May 17, 2013, by and among Heron Lake BioEnergy, LLC and initial subscribers of the 7.25% Subordinated Secured Notes due 2018
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Exhibit 10.7 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.66
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Form of Interim Subordinated Note dated May 17, 2013 by Heron Lake BioEnergy, LLC to initial subscribers of the 7.25% Subordinated Secured Notes due 2018
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Exhibit 10.8 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.67
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Subordination Agreement dated effective as of May 17, 2013 by and among AgStar Financial Services, PCA and David J. and Krista R. Woestehoff, Schmitz Grain, Inc., Doug Schmitz, Michael Kunerth and Dawn Kunerth, Robert J. and Jean M. Ferguson, and Project Viking, L.L.C.
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Exhibit 10.9 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.68
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Subordinated Security Agreement dated May 17, 2013 by and between Heron Lake BioEnergy, LLC and the Collateral Agent for the benefit of David J. and Krista R. Woestehoff, Schmitz Grain, Inc., Doug Schmitz, Michael Kunerth and Dawn Kunerth, Robert J. and Jean M. Ferguson, and Project Viking, L.L.C.
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Exhibit 10.10 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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10.69
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Subordinated Mortgage dated May 17, 2013 between Heron Lake BioEnergy, LLC to David J. and Krista R. Woestehoff, Schmitz Grain, Inc., Doug Schmitz by Michael Kunerth and Dawn Kunerth, Robert J. and Jean M. Ferguson, and Project Viking, L.L.C.
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Exhibit 10.11 to Quarterly Report on Form 10-Q for the quarter ended April 30, 2013.
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10.70
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Letter Agreement between CFO Systems, LLC and Heron Lake BioEnergy, LLC effective July 8, 2013*
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Exhibit 10.1 to Current Report on Form 8-K dated July 5, 2013.
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10.71
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Amendment No. 1 to Sixth Amended and Restated Master Loan Agreement dated effective as of July 31, 2013 between Heron Lake BioEnergy, LLC and AgStar Financial Services, PCA
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Exhibit 10.1 to Current Report on Form 8-K dated August 27, 2013.
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10.72
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Assignment and Amendment Agreement dated July 2, 2013 by and among Heron Lake BioEnergy, LLC, Gavilon, LLC and Gavilon Global Ag Holdings, LLC †
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Exhibit 10.1 to Quarterly Report on Form 10-Q for the quarter ended July 31, 2013.
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10.73
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Subscription Agreement Including Investment Representations, dated July 31, 2013, by and between Heron Lake BioEnergy, LLC and Project Viking, L.L.C.
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Exhibit 10.2 to Quarterly Report on Form 10-Q for the quarter ended July 31, 2013.
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10.74
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Subscription Supplement Agreement dated July 31, 2013, by and among Heron Lake BioEnergy, LLC, Granite Falls Energy, LLC and Project Viking, L.L.C.
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Exhibit 10.3 to Quarterly Report on Form 10-Q for the quarter ended July 31, 2013.
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10.75
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Management Services Agreement effective as of July 31, 2013 between Granite Falls Energy, LLC and Heron Lake BioEnergy, LLC*
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Exhibit 10.4 to Quarterly Report on Form 10-Q for the quarter ended July 31, 2013.
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10.76
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Corn Oil Marketing Agreement dated September 4, 2013 by and among Heron Lake BioEnergy, LLC and RPMG, Inc. †
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Attached hereto.
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10.77
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Ethanol Marketing Agreement dated September 17, 2013 by and among Heron Lake BioEnergy, LLC and Eco-Energy, LLC †
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Exhibit 10.77 to Annual Report on Form 10-K for the Year ended October 31, 2013.
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10.78
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Distiller's Grain Off-Take Agreement dated September 24, 2013 by and among Heron Lake Bio-Energy, LLC and Gavilon Ingredients, LLC †
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Attached hereto.
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21.1
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Subsidiaries of the Registrant
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Exhibit 21.1 to Annual Report on Form 10-K for the year ended October 31, 2011.
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31.1
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Certification of Chief Executive Officer (principal executive officer) pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act.
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Attached hereto.
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31.2
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Certifications of Chief Financial Officer (principal financial officer) pursuant to Rules 13a-14(a) and 15d-14(a) of the Exchange Act.
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Attached hereto.
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Exhibit
Number
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Exhibit Title
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Incorporated by Reference To:
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32
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Certification pursuant to 18 U.S.C. § 1350.
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Exhibit 32 to Annual Report on Form 10-K for the Year ended October 31, 2013.
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101.1
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The following materials from Heron Lake BioEnergy, LLC's Annual Report on Form 10-K for the fiscal year ended October 31, 2013, formatted in XBRL (Extensible Business Reporting Language): (i) the Consolidated Balance Sheets as of October 31, 2013 and October 31, 2012, (ii) the Consolidated Statements of Operations for the fiscal years ended October 31, 2013, 2012, and 2011, (iii) the Consolidated Statements of Changes in Members' Equity, (iv) the Consolidated Statements of Cash Flows for the fiscal years ended October 31, 2013, 2012, and 2011, and (v) the Notes to Consolidated Financial Statements.
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A.
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RPMG markets corn oil (as hereinafter defined).
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B.
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Producer produces or shall produce corn oil at Producer’s ethanol production facility located or to be located at Heron Lake, Minnesota (the “
Ethanol Facility
”).
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C.
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The Parties desire that RPMG shall market corn oil produced at the Ethanol Facility.
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1.
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Marketing of Corn Oil.
Producer shall sell to RPMG, and RPMG shall purchase and market, all of Producer’s production, of corn oil produced at the Ethanol Facility, including any expansion or increase in capacity at the Ethanol Facility. RPMG shall be the exclusive marketer of corn oil and Producer shall not, either itself or through any affiliate or any third party, market any corn oil during the term of this Agreement. RPMG shall provide management resources to market and sell corn oil, including the management of logistics and collection.
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2.
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Payments to Producer; Commissions; Audit Rights
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(a)
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Payments to Producer
. Subject to the other terms of this Agreement, RPMG shall make payments for Producer’s corn oil in accordance with the terms set forth in
Exhibit A
. RPMG shall use commercially reasonable efforts to make such payments to Producer on an average net ten (10) days.
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(b)
|
RPMG Commission
. Producer shall pay RPMG commissions as follows: [***] for each pound of corn oil sold to third party end purchasers (each, an “
End Customer
”). Parties shall from time to time, but no more than once per year, or upon the reasonable request of RPMG, negotiate in good faith adjustments to the foregoing commissions to reflect prevailing commissions being paid to marketers of corn oil produced by third parties in the United States.
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(c)
|
Accessorial Charges
. As set forth on
Exhibit A
, RPMG shall be responsible for payment of Accessorial Charges (as defined in
Exhibit A
) to third parties; provided, however, that Producer agrees (1) to promptly reimburse RPMG for such Accessorial Charges upon submission to Producer of an invoice itemizing such Accessorial Charges, and (ii) that RPMG
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(d)
|
Late Payments
. Overdue amounts not disputed in good faith payable to either Party shall be subject to late payment fees equal to interest accrued on such amounts at the maximum rate permitted by applicable law.
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(e)
|
No Warranty as to Prices
. RPMG shall market Producer’s corn oil using commercially reasonable efforts and the same standards it uses to market the corn oil production of third parties for whom RPMG provides corn oil marketing services. RPMG shall endeavor to (i) maximize the corn oil price and minimize freight and other costs relevant to corn oil sales and (ii) achieve the best available return to Producer, subject to relevant market conditions. PRODUCER ACKNOWLEDGES THAT RPMG MAKES NO REPRESENTATIONS, GUARANTEES OR WARRANTIES OF ANY NATURE WHATSOEVER AS TO THE PRICES AT WHICH IT SHALL BE ABLE TO SELL PRODUCER’S CORN OIL TO END CUSTOMERS.
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(f)
|
Waiver of Certain Claims
. Producer acknowledges (i) that RPMG shall use its reasonable judgment in making decisions related to the quantity and price of corn oil marketed under this Agreement, in light of varying freight and other costs, and (ii) that RPMG may sell and market corn oil of third parties into the same markets where RPMG sells Producer’s corn oil. Producer waives any claim of conflict of interest against RPMG or for failure by RPMG to maximize the economic benefits of this Agreement for Producer in light of the foregoing.
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(g)
|
Audit Rights
. Within ninety (90) days following the end of RPMG’s fiscal year end, Producer shall give written notice to RPMG of its desire to conduct an audit of its corn oil payments to Producer for the preceding fiscal year of RPMG and RPMG shall provide reasonable access to all financial information necessary to complete such audit. The audit shall be conducted by an accounting firm agreeable to both Parties and shall be completed within forty-five (45) days after the completion of RPMG’s annual audit, but no later than one hundred and fifty (150) days following RPMG’s fiscal year end. The cost of the audit shall be the responsibility of Producer unless the auditor determines that RPMG underpaid Producer by more than three percent (3%) for the period audited, in which case RPMG shall pay the cost of the audit. If the auditor determines that RPMG underpaid Producer, RPMG shall promptly pay such underpayment to Producer and if the auditor determines that RPMG overpaid Producer, Producer shall promptly pay the overpayment to RPMG. The determination of the auditor shall be final and binding on both Parties. If Producer fails to exercise its right to audit as provided in this Section 2(g) for any year, it shall be deemed to have waived any rights to dispute payments made to Producer for that year.
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3.
|
Scheduled Production
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|
(a)
|
Notices of Scheduled Production
. Beginning on the Effective Date, and on the 1st and 15th of each month thereafter, Producer shall provide to RPMG a rolling best estimate of production and inventory by corn oil product for that month and each of the following twelve (12) months. Beginning on the Effective Date and each Wednesday thereafter, Producer shall provide to RPMG a best estimate of production and inventory by corn oil product for that day and the next seven days.
|
|
(b)
|
Additional Production Notices
. Producer shall notify RPMG of anticipated production downtime or disruption in corn oil availability at least one (1) month in advance of such outage. Producer shall timely inform RPMG of daily inventories, plant shutdowns, daily production projections, and any other information (i) to facilitate RPMG’s performance of the Agreement or (ii) that may have a material adverse effect on RPMG’s ability to perform the Agreement.
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(c)
|
RPMG Entitled to Rely on Producer Estimates and Notices
. RPMG, in marketing and selling Producer’s corn oil, is entitled to rely upon the production estimates and other notices provided by Producer, including without limitation those described in Sections 3(a) or (b). Producer’s failure to provide accurate information to facilitate RPMG’s performance of the Agreement may negatively impact RPMG’s ability to market and sell corn oil at prevailing prices. Producer’s failure to provide accurate information to facilitate RPMG’s performance of the Agreement may be deemed by RPMG, in its sole but reasonable discretion, a material breach of the Agreement by Producer.
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(e)
|
Sale Commitments
. From time to time during the term of this Agreement and in (e) order to maximize the sales price of corn oil, RPMG may enter sales contracts or other agreements with End Customers for future delivery of corn oil. In the event Producer fails to produce corn oil in accordance with the information provided to RPMG under Sections 3(a) or (b) above for reasons other than Force Majeure (as defined in Section 10 herein), and as a result RPMG is required to purchase corn oil from third parties to meet previous corn oil sale commitments that are based upon such information, RPMG may charge Producer the amount (if any) that the price of such replacement corn oil exceeded the price that RPMG would have paid to Producer for the applicable corn oil under this Agreement.
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4.
|
Logistics and Transportation
|
|
(a)
|
No Liens, Title and Risk of Loss
. Producer warrants that corn oil delivered to RPMG hereunder shall be free and clear of all liens and encumbrances of any nature whatsoever other than liens in favor of RPMG. Title to and risk of loss of each load of corn oil shall pass to RPMG at the time such load passes across the scale into rail cars or trucks at the Ethanol Facility (the “
Title Transfer Point
”). Until such time, Producer shall be deemed to be in control of and in possession of the corn oil.
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(b)
|
Loading
. RPMG shall schedule the loading and shipping of all outbound corn oil purchased hereunder, but all labor and equipment necessary to load trucks and rail cars and other associated costs shall be supplied and borne by Producer without charge to RPMG. Producer shall handle the corn oil in a good and workmanlike manner in accordance with RPMG’s written requirements and normal industry practice. Producer shall maintain the truck and rail loading facilities in safe operating condition in accordance with normal industry standards and shall visually inspect all trucks and rail cars to assure (i) cleanliness so as to avoid contamination, and (ii) that such trucks and railcars are in a condition suitable for transporting the corn oil. RPMG and RPMG’s agents shall have adequate access to the Ethanol Facility to load Producer’s corn oil on an industry standard basis that allows RPMG to economically market Producer’s corn oil. RPMG’s employees shall follow all reasonable safety rules and procedures promulgated by Producer and provided to RPMG reasonably in advance and in writing. Producer shall supply product description tags, certificates of analysis, bills of lading and/or material safety data sheets that are applicable to all shipments.
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(c)
|
Transportation and Certain Transportation Costs
. RPMG shall perform certain logistics functions for Producer, including the arranging of rail and truck freight, inventory management, contract management, bills of lading, and scheduling pick-up appointments. RPMG shall determine the method of transporting corn oil to End Customers. Notwithstanding any provision to the contrary herein, Producer shall be solely responsible for any damage to any trucks, railcars, equipment, or vessels caused by acts or omissions of Producer and its consignees. All truck freight charges and rail tariff rate charges shall be billed directly to RPMG and, as set forth in
Exhibit A
, be recouped by RPMG from the proceeds of RPMG’s sales of corn oil to End Customers. Notwithstanding the foregoing, rail cars required to transport the corn oil will be leased directly by Producer. If requested in writing by Producer, RPMG will make lease payments for such rail cars on behalf of Producer, and in such event RPMG shall recoup lease payments from the proceeds of RPMG’s sales of corn oil to End Customers.
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(d)
|
Weight
. The quantity of corn oil delivered to RPMG at the. Ethanol Facility shall be established by weight certificates obtained from Producer’s scales or from such other scales as the Parties shall mutually agree, which are certified as of the time of weighing and which comply with all applicable laws, rules and regulations. Producer shall provide RPMG with a fax/emailed copy of the outbound weight certificates on a daily basis and, except as otherwise expressly agreed upon, such outbound weight certificates shall be determinative of the quantity of corn oil for which RPMG is obligated to pay Producer pursuant to this Agreement.
|
|
(e)
|
Corn oil Storage at Ethanol Facility
. The estimated storage capacity of the Ethanol Facility, is as follows:
|
|
5.
|
Specifications; Quality.
|
|
(a)
|
Corn oil Specifications
. Producer covenants that it shall produce corn oil that, upon delivery to RPMG at the Ethanol Facility, meets the respective specifications (“
Specifications
”) set forth in
Exhibit B
and such other specifications that may be, from time-to-time, promulgated by the industry for corn oil. RPMG shall have the right to test each shipment of corn oil to ascertain that the Specifications are being met. If the corn oil provided by Producer to RPMG is shown, by independent testing or analysis of a representative sample or samples taken consistent with industry standards, to not meet the Specifications through no fault of RPMG or any third party engaged by RPMG, then RPMG may, in its sole discretion, (i) reject such corn oil and require Producer to promptly replace such non-conforming corn oil with corn oil that complies with the Specifications, or (ii) accept such corn oil for marketing and, if necessary, adjust the price to reflect the inferior quality, as provided in
Exhibit A
. Payment and acceptance of delivery by RPMG shall not waive RPMG’s rights if corn oil does not comply with the terms of this Agreement, including the Specifications.
|
|
(b)
|
Trade Rules
. This Agreement shall be governed by the then-current Feed Trade Rules of the National Grain and Feed Association (the “
Trade Rules
”), unless otherwise specified. In the event the Trade Rules and the terms and conditions of this Agreement conflict, this Agreement shall control.
|
|
(c)
|
Compliance With FDA and Other Standards
. Producer warrants that, unless caused by the negligence or intentional misconduct of RPMG or a third party engaged by RPMG, corn oil provided by Producer to RPMG (1) shall not be “adulterated” or “misbranded” within the meaning of the Federal Food, Drug and Cosmetic Act (the “
Act
”), (ii) may lawfully be introduced into interstate commerce under the Act, and (iii) shall comply with all state and federal laws, rules and regulations (including without limitation the Trade Rules) including those governing quality, naming and labeling of bulk product. If Producer knows or reasonably suspects that any corn oil produced at the Ethanol Facility is adulterated or misbranded, or otherwise not in compliance with the terms of the Agreement, Producer shall immediately so notify RPMG in writing.
|
|
(d)
|
Regulatory Seizure
. Should any corn oil provided by Producer to RPMG hereunder be seized or condemned by any federal or state department or agency as a result of its failure to conform to any applicable law, rule or regulation prior to delivery to an End Customer, such seizure or condemnation shall operate as a rejection by RPMG of the goods seized or condemned and RPMG shall not be obligated to offer any defense in connection with such seizure or condemnation. When such rejection occurs, RPMG shall deliver written notice to Producer within a reasonable time of the rejection and identify the deficiency that resulted in such rejection. In addition to other obligations under this Agreement or at law, Producer shall reimburse RPMG for all out-of-pocket costs reasonably incurred by RPMG in storing, transporting, returning and disposing of the rejected goods in accordance with this Agreement.
|
|
(e)
|
Sampling
. Producer shall take one representative origin sample (pint size) from each lot of the corn oil before it leaves the Ethanol Facility (each, a “
Sample
”). RPMG shall be entitled to witness the taking of Sample. Producer shall label Sample to indicate the applicable corn oil lot numbers, date of shipment, and the truck or railcar number. Producer shall send half of Sample to RPMG promptly upon RPMG’s request. Producer may request that RPMG test results be provided to it at any time after the tests are completed. Producer shall retain corn oil Sample for no less than three (3) months or any longer period required by law. If RPMG knows or reasonably suspects that any corn oil produced by Producer at the Ethanol Facility is not in compliance with the terms of this Agreement, then RPMG may obtain independent laboratory tests of such corn oil, and, if such corn oil is found not to be in compliance with the terms of this Agreement, Producer shall, in addition to its other obligations hereunder, pay all such testing costs.
|
|
6.
|
Term and Termination
|
|
(a)
|
Term
. The initial term of this Agreement shall commence on the date hereof and continue for 12 months from the Effective Date. Thereafter, this Agreement shall remain in effect until terminated by either party at its unqualified option by providing the other party hereto not less than 90 days written notice of its election to terminate this agreement. Either party may terminate this Agreement if the other party breaches this Agreement and fails to cure the breach within 30 days after receipt of notice of such breach or if the other party be
|
|
(b)
|
Producer Termination Right
. Producer may immediately terminate this Agreement upon written notice to RPMG if RPMG fails on three (3) separate occasions within any 12-month period to purchase corn oil or to market corn oil under circumstances where such breach or failure is not excused by this Agreement.
|
|
(c)
|
RPMG Termination Right
. RPMG may immediately terminate this Agreement upon written notice to Producer, if, for reasons other than a Force Majeure (as defined in Section 10 herein) event, during any consecutive three (3) months, Producer’s actual production or inventory of any corn oil product at the Ethanol Facility varies by twenty percent (20%) or more from the monthly production and inventory estimates provided by Producer to RPMG pursuant to Section 3(b) hereunder.
|
|
(d)
|
Termination for Insolvency
. Either Party may immediately terminate the Agreement upon written notice to the other Party if the other Party files a voluntary petition in bankruptcy, has filed against it an involuntary petition in bankruptcy, makes an assignment for the benefit of creditors, has a trustee or receiver appointed for any or all of its assets, is insolvent or fails or is generally unable to pay its debts when due, in each case where such petition, appointment or insolvency is not dismissed, discharged or remedied, as applicable, within thirty (30) days.
|
|
7.
|
Indemnification; Limitation on Liability
|
|
(a)
|
Producer’s Indemnification Obligation
. Producer shall indemnify, defend and hold harmless RPMG and its shareholders, directors, officers, employees, agents and representatives, from and against any and all Damage (as defined in Section 7(c) herein) to the extent arising out of (i) any fraud, negligence or willful misconduct of Producer or any of its directors/governors, officers, employees, agents, representatives or contractors or (ii) any breach of this Agreement by Producer. RPMG shall promptly notify Producer of any suit, proceeding, action or claim for which Producer may have liability pursuant to this Section 7(a).
|
|
(b)
|
RPMG’s Indemnification Obligation
. RPMG shall indemnify, defend and hold harmless Producer and its shareholders/members, directors/governors, officers, employees, agents and representatives from and against any and all Damages to the extent arising out of (i) any fraud, negligence or willful misconduct of RPMG or any of its directors, officers, employees, agents, representatives or contractors or (ii) any breach of this Agreement by RPMG. Producer shall promptly notify RPMG of any suit, proceeding, action or claim for which Producer may have liability pursuant to this Section 7(b).
|
|
(c)
|
Definition of Damages
. As used in this Agreement, the capitalized term “Damages” means any and all losses, costs, damages, expenses, obligations, injuries, liabilities, insurance deductibles and excesses, claims, proceedings, actions, causes of action, demands, deficiencies, lawsuits, judgments or awards, fines, penalties and interest, including reasonable attorneys’ fees, but excluding any indirect, incidental, special, exemplary, consequential or punitive damages.
|
|
(d)
|
Limitation on Liability
. NEITHER PARTY MAKES ANY GUARANTEE, WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, WITH RESPECT TO ANY PROFIT, OR OF ANY PARTICULAR ECONOMIC RESULTS FROM TRANSACTIONS HEREUNDER. EXCEPTING FOR A BREACH OF ITS NONDISCLOSURE OBLIGATIONS OR PERFORMANCE OF ITS INDEMNIFICATION OBLIGATIONS HEREUNDER, RPMG’S AGGREGATE LIABILITY TO PRODUCER SHALL IN NO EVENT EXCEED THE AMOUNT PAID BY PRODUCER TO RPMG UNDER THIS AGREEMENT.
|
|
8.
|
Insurance.
During the term of this Agreement, each party shall maintain insurance coverage that is standard for a company of its type and size that is engaged in the production and/or selling of corn oil. At a minimum, each party’s insurance coverage shall include: (i) comprehensive general product and public liability insurance, with liability limits of at least $5 million in the aggregate; (ii) property and casualty insurance adequately insuring its facilities and its other assets against theft, damage and destruction on a replacement cost basis; and (iii) workers’ compensation insurance to the extent required by law. RPMG, or Producer, as the case may be, shall be added as a loss payee under the comprehensive general product and public liability insurance policy and the property and casualty insurance policy. In relation to insurance requirements on the corn oil leased railcars, (a) the Producer will be responsible for the liability insurance on the corn oil leased railcars in the form and amount as required by the railcar lessor’s contract, or at a minimum in the amounts required by this Article 8 and (b) RPMG will carry property/physical damage insurance for the corn oil railcars for loss or destruction, but will not be responsible for the insurance deductible, maintenances (scheduled or otherwise), including normal wear and tear related to such corn oil railcars. The Producer will be listed as a Loss Payee on RPMG’s Rolling Stock Policy in relation to the corn oil leased railcars. A party shall not change its insurance coverage during the term of this Agreement, except to increase it or enhance it, without the prior written consent of the other Party which consent shall not be unreasonably withheld.
|
|
9.
|
Confidentiality
|
|
(a)
|
Confidential Information
. As used in this Agreement, the capitalized term “Confidential Information” means (i) the terms and conditions of this Agreement and (ii) any information disclosed by one Party to the other, including, without limitation, trade secrets, strategies, marketing and/or development plans, End Customer lists and other End Customer information, prospective End Customer lists and other prospective End Customer information, vendor lists and other vendor information, pricing information, financial information, production or inventory information, and/or other information with respect to the operation of its business and assets, in whatever form or medium provided.
|
|
(b)
|
Nondisclosure
. Each Party shall maintain all Confidential Information of the other in trust and confidence and shall not without the prior written consent of the other Party:
|
|
(i)
|
disclose, disseminate or publish Confidential Information to any person or entity without the prior written consent of the disclosing Party, except to employees of the receiving Party who have a need to know, who have been informed of the receiving Party’s obligations hereunder, and who have agreed not to disclose Confidential Information or to use Confidential Information except as permitted herein, or
|
|
(ii)
|
use Confidential Information for any purpose other than the performance of its obligations under the Agreement.
|
|
(c)
|
Standard of Care
. The receiving Party shall protect the Confidential Information of the disclosing Party from inadvertent disclosure with the same level of care (but in no event less than reasonable care) with which the receiving Party protects its own Confidential Information from inadvertent disclosure.
|
|
(d)
|
Exceptions
. The receiving Party shall have no obligation under this Agreement to maintain in confidence any information which it can prove:
|
|
(i)
|
is in the public domain at the time of disclosure or subsequently becomes part of the public domain through no act or failure to act on the part of the receiving Party or persons or entities to whom the receiving Party has disclosed such information;
|
|
(ii)
|
is in the possession of the receiving Party prior to the time of disclosure by the disclosing Party and is not subject to any duty of confidentiality;
|
|
(iii)
|
the receiving Party obtains from any third party not under any obligation to keep such information confidential; or
|
|
(iv)
|
the receiving Party is compelled to disclose or deliver in response to a law, regulation, or governmental or court order (to the least extent necessary to comply with such order), provided that the receiving Party notifies the disclosing Party promptly after receiving such order to give the disclosing Party sufficient time to contest such order and/or to seek a protective order.
|
|
(e)
|
Ownership of Confidential Information
. All Confidential Information shall remain the exclusive property of the disclosing Party.
|
|
(f)
|
Injunctive Relief for Breach
. The receiving Party acknowledges that monetary damages may not be a sufficient remedy for unauthorized disclosure or use of Confidential Information, and that the disclosing Party may be entitled, in addition to all other rights or remedies in law and equity, to obtain injunctive or other equitable relief, without the necessity of posting bond in connection therewith.
|
|
10.
|
Force Majeure
.
In the event either Party is unable by Force Majeure (as defined below) to carry out its obligations under this Agreement, it is agreed that on such Party’s giving notice in writing, or by telephone and confirmed in writing, to the other Party as soon as possible after the commencement of such Force Majeure event, the obligations of the Party giving such notice, so far as and to the extent they are affected by such Force Majeure, shall be suspended from the commencement of such Force Majeure and during the remaining period of such Force Majeure, but for no longer period, and such Force Majeure shall so far as possible be remedied with all reasonable dispatch; provided, however, the obligation to make payments then accrued hereunder prior to the occurrence of such Force Majeure shall not be suspended and Producer shall remain obligated for any loss or expense to the extent otherwise provided in this Agreement. The capitalized term “Force Majeure” as used in this Agreement shall mean events beyond the reasonable control and without the fault of the Party claiming Force Majeure, including acts of God, war, riots, insurrections, laws,
|
|
11.
|
Dispute Resolution
.
In the event a dispute arises under this Agreement that cannot be resolved by those with direct responsibility for the matter in dispute, such dispute shall be resolved by way of the following process:
|
|
(a)
|
Senior management from Producer and from RPMG shall meet to discuss the basis for the dispute and shall use their best efforts to reach a reasonable resolution to the dispute.
|
|
(b)
|
If negotiations pursuant to Section 11(a) are unsuccessful, the matter shall promptly be submitted by either Party to arbitration in accordance with NGFA® ARBITRATION OF DISPUTES: The parties to this contract agree that the sole remedy for resolution of any and all disagreements or disputes arising under or related to this contract shall be through arbitration proceedings before the National Grain and Feed Association (NGFA) pursuant to the NGFA® Arbitration Rules. The decision and award determined through such arbitration shall be final and binding upon the Buyer and Seller. Judgment upon the arbitration award may be entered and enforced in any court having jurisdiction thereof. (Copies of the NGFA® Arbitration Rules are available from the National Grain and Feed Association, 1250 Eye Street, N.W., Suite 1003, Washington, D.C. 20005; Telephone: 202-289-0873; Website: http://www.ngfa.org). If the Parties reach agreement pertaining to any dispute pursuant to the procedures set forth in this Section 11, such agreement shall be reduced to writing, signed by authorized representatives of each Party, and shall be final and binding upon the Parties.
|
|
12.
|
Miscellaneous.
|
|
(a)
|
Successors and Assigns; Assignment
. All of the terms, covenants, and conditions of this Agreement shall be binding upon, and inure to the benefit of and be enforceable by the Parties and their respective successors, heirs, executors and permitted assigns. No Party may assign its rights, duties or obligations under this Agreement to any other person or entity without the prior written consent of the other Party, such consent not to be unreasonably withheld or delayed; notwithstanding the foregoing, a Party may, without the consent of the other Party, assign its rights and obligations under this Agreement to (i) its parent, a subsidiary, or affiliate under common control with the Party or (ii) a third party acquiring all or substantially all of the assets or business of such Party.
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|
(b)
|
Notices
. Any notice or other communication required or permitted hereunder shall be in writing and shall be considered delivered in all respects when delivered by hand, mailed by first class mail postage prepaid, or sent by facsimile with delivery confirmed, addressed as follows:
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|
(c)
|
Applicable Law
. This Agreement shall be governed in all respects by the laws of the State of Minnesota, except with respect to its choice of law provisions.
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(d)
|
Severability
. In the event that any provision of this Agreement becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, either in whole or in part, this Agreement shall continue in full force and effect without said provision.
|
|
(e)
|
No Third Party Beneficiaries
. No provision of this Agreement is intended, or shall be construed, to be for the benefit of any third party, including, without limitation, the Designee.
|
|
(f)
|
Entire Agreement Amendment
. This Agreement constitutes The entire understanding and agreement between the Parties with respect to the subject matter hereof, and supersedes all prior and contemporaneous understandings and/or agreements, written or oral, regarding the subject matter of this Agreement. No amendment or modification to this Agreement shall be binding unless in writing and signed by a duly authorized officer of both Parties.
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(g)
|
Counterparts
. This Agreement may be executed in counterparts, including facsimile or .pdf counterparts, each of which shall be deemed an original but together shall constitute but one and the same instrument.
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(h)
|
Waiver
. The failure of either Party at any time to require performance of any provision of the Agreement or to exercise any right provided for in the Agreement shall not be deemed a waiver of such provision or right unless made in writing and executed by the Party waiving such performance or right. No waiver by either Party of any breach of any provision of the Agreement or of any right provided for in the Agreement shall be construed as a waiver of any continuing or succeeding breach of such provision or right or a waiver of the provision or right itself.
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(i)
|
Independent Contractors
. The Parties to this Agreement are independent contractors. There is no relationship of partnership, joint venture, employment, franchise, or agency between the Parties, and no Party shall make any representation to the contrary.
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(j)
|
Additional Rules of Interpretation
.
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(i)
|
The words “include,” “includes” and “including” as used in this Agreement shall be deemed to be followed by the phrase “without limitation” and shall not be construed to mean that the examples given are an exclusive list of the topics covered.
|
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(ii)
|
The headings as to contents of particular sections of this Agreement are inserted for convenience and shall not be construed as part of the Agreement or as a limitation on the scope of any terms or provisions of this Agreement.
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(k)
|
Survival
. The following provisions of this Agreement shall survive its termination: (i) to the extent of outstanding payment obligations, Sections 2(a), 2(b), 2(c), and 2(d) and (ii) Sections 2(e), 2(f), 7, 9, 11, and 12.
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|
Component
|
Maximum %
|
|
Moisture; wt%
|
[***]
|
|
Impurities; wt%
|
[***]
|
|
Unsaponafiables; wt%
|
[***]
|
|
FFA; wt%
|
[***]
|
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1.1
|
Term.
This Agreement shall become effective on November 1, 2013 and shall remain in effect for six months. Thereafter, this Agreement shall continue until terminated by either Party upon no less than sixty (60) days prior written notice, provided that such termination shall have no effect with respect to any Confirmed Orders entered into prior to the effectiveness of such termination.
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2.1
|
Delivery
. During the Term, Producer shall sell and make available for delivery to Gavilon, and Gavilon shall purchase and take delivery of all distiller’s grains produced at the Facility. Such distiller’s grains shall meet the applicable specifications set forth herein (“
Product
”).
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2.2
|
Price; Payment Terms
.
The price for Product sold hereunder (the “Price”) shall be based on market-price bids from Gavilon’s customers, less (a) Logistics Costs and (b) the applicable Service Fee. Gavilon agrees to use commercially reasonable efforts to achieve the highest Price available under prevailing market conditions. Payments on all undisputed amounts shall be made within ten (10) business days from Gavilon’s receipt of the information set forth in Section 2.4. Payments shall be made via wire to a bank account specified by the Producer.
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|
2.3
|
Logistics Costs; Fees; Net Price
. For purposes of this Agreement, “Logistics Costs” means the costs, without markup, for providing services related to or connected with either (i) transporting, storing, transloading, and otherwise handling (including demurrage, and shrinkage costs unless caused by the acts or omissions of Gavilon) Product after delivery to Gavilon, or (ii) the delivery of Transport Vessels to the Delivery Point (as defined in Section 5.5) for loading. The applicable Service Fee for Gavilon purchase shall be as follows:
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|
2.3.1
|
With respect to dried distillers grains, [***].
|
|
2.3.2
|
With respect to wet distillers grains, [***] of wet distillers grains sold
|
|
2.4
|
Billing Information
.
For each shipment of Product to Gavilon, Producer shall furnish the following in reasonable detail: (i) an invoice giving the actual quantity and date of shipment of the Product, (ii) the applicable weight certificate(s) described in Section 3.2.
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|
2.5
|
Payment Verification
.
Any payment made pursuant to this Section will not preclude a Party from subsequently verifying payments of the other Party as permitted in Section 14.3 of this Agreement. Each party shall use commercially reasonable efforts to resolve any disputed payment amounts within 72 hours of the time notice of such dispute was received by the non-disputing party.
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|
2.6
|
Taxes
.
Producer shall pay or cause to be paid all valid levies, assessments, duties, rates and taxes (together “
Taxes
”) on Product delivered hereunder that arise prior to, or as a result of, the sale and delivery of Product at the Delivery Point. Gavilon shall pay or cause to be paid all Taxes, including fuel or excise Taxes, on Product that arise after the sale (other than third-party sales) and delivery of Product to Gavilon at the Delivery Point.
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|
3.1
|
Delivery
.
Delivery and receipt of Product purchased hereunder shall take place at the applicable Delivery Point (as defined in Section 5.5) in accordance with the corresponding Confirmed Order. The Parties shall establish a mutually agreed Delivery Schedule as defined and described in
Exhibit “A”
.
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|
3.2
|
Quantities
.
The quantity of Product delivered to Gavilon shall be established by outbound weight certificates, as evidenced by the weight documentation provided by Producer. The certificates shall be obtained daily from either scales or other metering devices which are certified as of the time of weighing and which comply with all applicable laws, rules and regulations. Gavilon shall have the right to test such scales or devices at any time provided that such testing shall not cause any unreasonable disruption to Producer’s operations at the Facility.
|
|
3.3
|
Standards
.
Producer understands that Gavilon intends to sell the Product as a primary animal feed ingredient and that such Product are subject to minimum quality standards for such use. Producer agrees and warrants that the Product shall be accepted in the feed trade under current industry standards, shall fully comply with any applicable state and federal laws governing quality of product, and shall be free and clear of liens and encumbrances.
|
|
3.4
|
Specifications
.
Producer warrants that unless otherwise mutually agreed in writing all Product sold hereunder shall, at the time of delivery to Gavilon, conform to the minimum quality requirements set forth in this Section 3.4. The values quoted below are on an “as
|
|
Dried Distillers Grains
|
||||||||||
|
|
Crude Protein
|
Crude Fat
|
Crude Fiber
|
Moisture
|
|
|||||
|
|
Min
|
Max
|
Min
|
Max
|
Min
|
Max
|
Min
|
Max
|
|
|
|
|
25
|
|
7.0
|
|
|
15
|
|
12.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wet Distillers Grains
|
||||||||||
|
|
Crude Protein
|
Crude Fat
|
Crude Fiber
|
Moisture
|
|
|
||||
|
|
Min
|
Max
|
Min
|
Max
|
Min
|
Max
|
Min
|
Max
|
|
|
|
|
11
|
|
4.0
|
|
|
5.5
|
|
60
|
|
|
|
3.5
|
No Adulteration or Misbranding
. Producer warrants that at the time of loading, the Product will not be adulterated or misbranded within the meaning of the Federal Food, Drug and Cosmetic Act and that each shipment may lawfully be introduced into interstate commerce under such Act. Payment of invoices does not waive Gavilon’s rights if the Product do not comply with terms or specifications of this Agreement.
|
|
3.6
|
Product Certification.
Weekly samples from Product will be sent to an outside laboratory for testing by Producer to ensure the Product conform to the specifications in Section 3.4. The results of such test will be forwarded from Producer to Gavilon upon receipt at the Facility.
|
|
3.7
|
Samples
.
Producer agrees to maintain a representative daily aggregate sample for a period of three (3) months. Producer will retain these samples and shall provide Gavilon access to such samples promptly upon request.
|
|
3.8
|
Nonconforming Product
.
If within five (5) days after arrival at customer Product are found to be out of specification by Gavilon or by an independent laboratory using industry approved analysis and sampling methods (“
Nonconforming Product
”), such condition will be promptly communicated to Producer. Gavilon will provide a copy of the certified laboratory report(s) evidencing the Nonconforming Product along with available chain of custody documentation. Producer may, within the succeeding five (5) days of receipt of such notice, take steps to refute or verify such nonconformance, including by obtaining an independent certified lab test and by observing conditions at the customer’s site that may impact test results including chain of custody of sample. All disputes regarding nonconforming product shall be settled pursuant to NGFA rules. Upon verification of such nonconformance, Producer will then direct Gavilon to either (i) sell the Nonconforming Product at a discounted
|
|
3.9
|
Quality Control Procedures.
Upon Producer’s receipt of the applicable truck or railcar, as (the “Transport Vessel”) and prior to product loading in each such Transport Vessel, Producer will visually inspect for equipment integrity, safety, and potential contamination. Producer shall notify Gavilon immediately in the event any Transport Vessel does not meet the minimum requirements. In the event a Transport Vessel provided by Gavilon is unsuitable for loading due to any of the aforementioned reasons, Gavilon shall arrange for a substitute Transport Vessel to arrive for loading within twenty-four (24) hours of Producer’s notification to Gavilon, or such longer period of time as may be agreed between Producer and Gavilon acting in a commercially-reasonable manner.
|
|
4.1
|
Third-Party Sales.
Section 2.1 notwithstanding, should Producer receive offers to purchase Product (i) in which delivery would occur more than fifteen (15) days forward, and (ii) at prices that would be more favorable to Producer than the gross price (exclusive of Service Fee) offered by Gavilon (but on terms that are otherwise customary and comparable to those set forth herein), Producer shall give Gavilon written notice of the delivery terms, quantity and sales price available to Producer as well as the third party offering those more favorable terms. If Gavilon does not match the third-party terms within one (1) business day of receipt of such notice, Producer may then sell Product to such third party in the quantities and prices as notified to Gavilon. In such event, at Producer’s written request, Gavilon shall generally assist Producer with the logistics relating to third-party sales. To the extent Producer requests Gavilon to assist with logistics of third-party sales, Producer shall pay Gavilon a service fee equal to [***]. No third-party sales shall affect any Confirmed Orders (as defined in
Exhibit “A”
) previously established between the Parties unless agreed upon in writing by both Parties.
|
|
4.2
|
Purchase Shortfall
.
If Gavilon fails to purchase and take delivery of any quantities of Product specified in Confirmed Orders, and Producer after using commercially reasonable efforts to mitigate any damage, has produced and must sell such Product to a substitute purchaser at a price lower than the applicable Price, Gavilon shall pay Producer the amount by which the applicable Price exceeds the actual sales price per ton, multiplied by the number of tons sold to the substitute purchaser. If Producer exercises commercially reasonable efforts and is still unable to sell any such Product to a substitute purchaser, then Gavilon
|
|
4.3
|
Delivery Shortfall
.
If Producer fails to make available for purchase the quantity of Product specified in Confirmed Orders, and Gavilon, using commercially reasonable efforts to mitigate any damage, is unable to obtain a substitute supply of Product at a price equal to or less than the Price, Producer shall pay Gavilon the amount by which the Price is less than the price paid by Gavilon for substitute supply, multiplied by the delivery shortfall (Confirmed Order quantity less the amount actually delivered by Producer); plus any additional costs solely and directly incurred by Gavilon to identify a substitute purchaser. Such payment shall be remitted within five (5) business days following the invoice date and receipt of supporting documentation. The remedy specified in this Section 4.3 shall be Gavilon’s sole and exclusive remedy in the event that Producer fails to supply the quantity of Product specified in the Confirmed Order.
|
|
5.1
|
Logistics Responsibilities
.
Gavilon shall be responsible for the management of logistics which arise prior to the Transport Vessel reaching the Delivery Point, and which arise after the Product is completely loaded onto the Transport Vessel (“
Delivery
”). This responsibility will include the management of Producer’s railcar fleet as further described in Section 5.6. Producer shall be responsible for all logistics that arise once the Transport Vessel has reached the Delivery Point up through Delivery. Gavilon will be responsible for monitoring logistics while the Transport Vessel is at destination to ensure efficient offloading. Gavilon will secure and maintain all licenses, documents and contracts necessary to transport Product following Delivery.
|
|
5.2
|
Hours of Operation.
Producer shall use commercially reasonable efforts to keep the Facility open for truck delivery between the hours of 7:00 am to 5:00 pm Monday through Friday (“
Normal Operating Hours
”). Gavilon may from time to time request that the Facility be accessible during other times or days. Producer will attempt to accommodate these requests provided Gavilon pays for any associated overtime costs incurred by Producer. Producer will promptly notify Gavilon in advance of scheduled events where truck delivery will not be possible. In instances where an unscheduled event makes truck delivery impossible, Producer will immediately notify Gavilon so that Gavilon may contact the applicable carriers.
|
|
5.3
|
Producer’s Demurrage Obligations
.
Producer’s responsibility for Demurrage if actual Demurrage compensation is sought, for trucks will begin to accrue after the second (2nd) hour waiting to load at the Facility provided the truck arrived during Normal Operating Hours. For purposes of this Agreement, the term “
Demurrage
” includes all costs, damages, penalties and charges resulting from any delay in loading and/or unloading of DDG shipments, whether due to mechanical failure or other event outside the course of normal
|
|
5.4
|
Notification of Problems with Delivery
. Producer shall inform Gavilon of any problem regarding any shipment of Product, without delay, by fax, telephone, or email, after Producer becomes aware of any such problem. This may include an event that could result in an unscheduled Facility shutdown, or the possible event that one or more Product orders are not available from Producer in the quantity originally set out in the Confirmed Order. Gavilon shall inform Producer of any problems in delivering Transport Vessels in accordance with the Delivery Schedule.
|
|
5.5
|
Delivery Point.
For purposes of this Agreement, the term “
Delivery Point
” means, with respect to Transport Vessels, the location at the Facility where the Transport Vessel is received for loading, as follows: the Delivery Point for railcar shipments is the railroads’ “constructively placed” designation; and the Delivery Point for trucks is the arrival of the truck at the Facility within the loading hours specified in this Agreement. “Delivery Point” means, with respect to Product, the location at the Facility where the loading of Product is completed on railcars or trucks, as follows: the Delivery Point for railcar shipments is the railroads’ “constructively placed” designation and the Delivery Point for truck shipments is the departure of the loaded truck from the Facility.
|
|
5.6
|
Railcars.
Producer will provide at its cost and expense all railcars required for Gavilon to deliver the Product sold hereunder. Consequently, railcar lease costs will not be included in Logistics Costs. In the event Producer experiences a shortage of railcars, Gavilon will sublease, on a monthly basis, such railcars as it may have available upon request by Producer. The monthly sublease charges will be based on market value (values proposed by Gavilon and accepted by Producer) lease costs and will be deducted from amounts otherwise payable by Gavilon to Producer.
|
|
6.1
|
Title; Risk of Loss
. Title to and risk of loss in Product purchased hereunder shall pass from Producer to Gavilon upon Delivery. Until such time, Producer shall be deemed to be in control of and in possession of and shall have title to and risk of loss in the Product.
|
|
6.2
|
Responsibility for Product
.
Gavilon shall have no responsibility or liability with respect to any Product until Delivery thereof pursuant to this Agreement. Without prejudice to Gavilon’s right to reject Nonconforming Product as set forth in Section 3 and without affecting Producer’s liability for the Delivery of Nonconforming Product, Producer shall have no responsibility or liability with respect to Product after its Delivery.
|
|
7.1
|
Producer represents and warrants that entry into this Agreement with Gavilon will not cause and/or result in a breach of any agreement in existence between Producer and any other party and that Producer is fully able to perform the terms of this Agreement and doing so will not result in or cause a breach of any obligation and/or duty that Producer has to any other Party.
|
|
8.1
|
Events of Default
.
The occurrence of any of the following shall be an “
Event of Default
” under this Agreement:
|
|
8.1.1
|
Breach by either Party in the performance of any material covenant or agreement set forth in this Agreement (subject to Section 8.1.3) and such breach continues uncured for more than thirty (30) days following written notice thereof from the non-defaulting Party; or
|
|
8.1.2
|
If either Party becomes insolvent or generally fails to pay its debts as they come due, or makes a general assignment for the benefit of creditors or to an agent authorized to liquidate any substantial amount of its assets, or is adjudicated bankrupt or has a receiver or custodian appointed with respect to a substantial part of its property, or files a petition in bankruptcy, or applies to a court for the appointment of a receiver for any of its assets or properties; or
|
|
8.1.3
|
If either Party fails to make payment hereunder within five (5) business days following receipt of written notice from the non-defaulting Party; or
|
|
8.1.4
|
The making of a materially incorrect or misleading representation or warranty under this Agreement; or
|
|
8.2
|
Remedies; Termination.
Upon an Event of Default, the non-defaulting Party shall notify the other Party thereof and shall have available all remedies set forth in this Agreement. Without limiting the foregoing, if an Event of Default occurs and is not waived, the non-defaulting Party may immediately terminate or suspend performance under this Agreement by promptly thereafter delivering written notice thereof to the other Party. The defaulting Party shall be responsible for any other costs and expenses (including, without limitation, reasonable attorneys’ fees and disbursements) incurred by the non-defaulting Party in connection with an Event of Default.
|
|
8.3
|
Right to Close Out Transactions.
Upon an Event of Default, the non-defaulting Party shall (in addition to any other rights or remedies available to it, whether at law or in equity, by contract or otherwise) have the right, upon twenty four (24) hours notice to the defaulting Party to liquidate and terminate any or all transactions then outstanding between the Parties (except to the extent that in the good faith opinion of the non-defaulting Party certain of such transactions may not be closed out and liquidated under applicable law) at any time and from time to time. No such notice shall be required with respect to termination pursuant to Section 8.2. The non-defaulting Party shall then calculate, in a commercially reasonable manner, a Settlement Amount (as defined below) for each transaction as of the time of its termination or as soon thereafter as is reasonably practicable and shall net such Settlement Amounts in the manner provided for below.
|
|
9.1
|
Nondisclosure of Confidential Information
.
Each Party acknowledges that, by reason of this Agreement it and its principals, employees, advisors, lenders, and affiliates may receive confidential or proprietary information belonging to the other Party. In no event will the terms and conditions of this Agreement be disclosed except to the extent required by applicable law or as agreed upon in writing by both Parties. The confidentiality obligations hereunder shall survive any expiration or termination of this Agreement. Notwithstanding the foregoing, confidential information may be delivered to third parties for the sole purpose of calculating a published pricing index.
|
|
9.2
|
Announcements
. Any public statements, press releases, and similar announcements concerning the negotiation or consummation of the transactions contemplated hereby, including such statements made by any representative of the Parties, shall be jointly planned and coordinated by the Parties. Neither Party shall issue any such statement without the prior review (for which the reviewing Party shall have a minimum of five (5) business days) and consent of the other Party, which consent shall not be unreasonably withheld or delayed. In no event will the terms and conditions of this Agreement be disclosed except to the extent required by applicable law.
|
|
10.1
|
Limitation of Liability
.
Without limiting any express remedies set forth in this Agreement, and except for any acts of willful misconduct or fraud, or damages arising from third-party product liability and product warranty claims, neither Producer nor Gavilon will be liable
|
|
10.2
|
Indemnification
.
Each Party (the “
Indemnitor
”) shall release, defend, indemnify and hold harmless the other party, its affiliates, its contractors, and their respective members, partners, directors, officers, shareholders, managers, employees, agents and representatives from and against any and all losses, damages, fines, liens, levies, penalties, claims, demands, causes of action, suits, legal or administrative proceedings, orders, governmental actions and judgments of every kind and character, and any and all costs and expenses (including, without limitation, reasonable attorneys’ fees, reasonable expert witness fees, and court costs) related thereto (collectively, “
Claims
”) which arise out of, result from or relate in any way, directly or indirectly, to (a) a breach of this Agreement by the Indemnitor, or (b) the acts or omissions hereunder of the Indemnitor or its affiliates, contractors, and their respective members, partners, directors, officers, shareholders, managers, employees, agents and representatives.
|
|
10.3
|
Insurance.
Each Party shall, during the Term, provide the insurance coverages as set forth in
Exhibit “B”
.
|
|
11.1
|
Force Majeure
.
In the event either Party hereto is rendered unable by reason of Force Majeure, to carry out its obligations under this Agreement, such Party shall promptly give written notice and reasonably complete particulars of such Force Majeure to the other Party stating the obligation(s) the performance of which are, or are expected to be, delayed or prevented. Notwithstanding anything herein to the contrary, the obligations of the notifying Party shall be suspended during and to the extent affected by Force Majeure and such event shall, so far as possible, be remedied with all reasonable dispatch.
|
|
11.2
|
Definition of Force Majeure
. The term “
Force Majeure
” shall mean any act, event or circumstance not reasonably within the control of the Party claiming suspension and which, by the exercise of due diligence, such Party is unable to prevent or overcome. Such term shall include, but not be limited to: (i) acts of God, (ii) strikes, lockouts or other industrial acts of the public enemy, (iii) wars, blockades, insurrections, riots, epidemics, acts of terrorism, (iv) transportation shortages, (v) landslides, lightning, earthquakes, fires, storms, floods, washouts, (vi) civil disturbances, and (vii) explosions. The term “Force Majeure” shall specifically include those events affecting any of Gavilon’s transporters of Product as well as regulatory changes which make the production and sale of Product unfeasible, but shall otherwise exclude any economic or commercial changes involving the production of Product.
|
|
12.1
|
Monitoring of DDG Positions
. Gavilon will monitor DDG sales made hereunder and may, from time to time, make suggestions concerning Producer’s risk management program and the position of its DDG sales for future physical delivery.
|
|
12.2
|
Marketing Conditions
. On an as needed basis, but not less frequently than weekly, Gavilon will review with Producer market conditions relating to Product, and forward marketing strategies in an attempt to assist Producer in maximizing its revenue on DDG sales. It is understood by Producer that all risk management services must be tied to a valid written purchase contract requiring physical delivery of Product to Gavilon.
|
|
12.3
|
No Liability
. Producer recognizes that Gavilon’s monitoring of DDG positions, periodic suggestions, review of market conditions and risk management services are informational and optional, and that the final decisions considering sales and risk management strategies, and the implementation of such strategies, will be made by, and is the sole responsibility of, Producer. Gavilon is not responsible for any Producer losses or entitled to any Producer gains resulting from risk management information supplied by Gavilon.
|
|
14.1
|
Assignment
.
Neither Party may assign any of its rights or obligations under this Agreement without the prior written consent of the other Party, not to be unreasonably withheld. A change in fifty percent (50%) or more in the ownership of a Party shall be construed to be an assignment for purposes of this Section. The above notwithstanding, either Party may, without the need for consent from the other Party: (i) transfer, sell, pledge, encumber or assign this Agreement, including the revenues or proceeds hereof, in connection with any financing arrangements; (ii) transfer or assign this Agreement to an affiliate as long as the affiliate is at least as creditworthy as the other Party; or (iii) transfer or assign this Agreement to an entity succeeding to all or substantially all of the assets of the other Party by way of merger, reorganization or otherwise. No assignment permitted hereunder shall in any way relieve the assigning Party from liability for full performance hereunder.
|
|
14.2
|
Records.
Each Party will establish and maintain true and accurate books, records and accounts relating to their own transactions under this Agreement with respect to all Prices charged, payments made, and quantities of Product delivered hereunder. These books, records and accounts will be preserved by the applicable Party for a period of at least one (1) year after the expiration of the term of this Agreement, but in no event longer than seven (7) years from the date of creation.
|
|
14.3
|
Audit Rights.
Upon five (5) business days notice and during normal business hours each Party has the right to audit such books, records and accounts of the other Party to the extent necessary in order to verify the accuracy of any statement, charge, computation or demand made under or pursuant to any provision of this Agreement. If any material error is discovered in any statement rendered hereunder, such error will be adjusted within seven (7) days from the date of discovery, but no adjustment will be made for errors discovered more than two years after delivery and receipt of such statements. Any error or discrepancy detected which has led to an overpayment or an underpayment between the Parties shall be corrected by an appropriate balancing payment to the underpaid Party or by a refund by the overpaid Party.
|
|
14.4
|
Inurement
.
This Agreement will inure to the benefit of and be binding upon the respective successors and permitted assigns of the Parties.
|
|
14.5
|
Entire Agreement
.
This Agreement and the Exhibits attached hereto constitute the entire agreement between the Parties with respect to the subject matter contained herein and any and all previous agreements, written or oral, express or implied, between the Parties or on their behalf relating to the matters contained herein are hereby terminated and canceled. In the event of a conflict between the terms of this Agreement and any Confirmed Orders, this Agreement shall govern.
|
|
14.6
|
Amendments
.
There will be no modification of the term and provisions hereof except by the mutual agreement in writing signed by the Parties.
|
|
14.7
|
Financial Information.
If requested by a Party hereto, the other Party shall deliver within one hundred twenty (120) days following the end of each fiscal year, a copy of its audited consolidated financial statements for such fiscal year certified by independent certified public accountants. In all cases the statements shall be for the most recent accounting period and prepared in accordance with generally accepted accounting principles, consistently applied; provided, however, should any such statements not be available timely due to a delay in preparation or certification, such delay shall not be considered a default so long as the Party providing the statements diligently pursues the preparation, certification and delivery of the statements. Notwithstanding the foregoing, Gavilon shall not be obligated to provide such financial information until Producer signs a nondisclosure agreement, in a form acceptable to Gavilon, pertaining to such information.
|
|
14.8
|
Trade Rules; Governing Law; Venue
.
All purchases and sales made hereunder shall be governed by the Feed Trade Rules of the National Grain and Feed Association (“
NGFA
”). In the event of a conflict between the terms set forth in this Agreement and the NGFA Rules the terms set forth herein shall control. The Agreement will otherwise be interpreted, construed and enforced in accordance with the procedural, substantive and other laws of the State of Nebraska without giving effect to principles and provisions thereof relating to conflict or choice of law even though one or more of the Parties is now or may do business in or become a resident of a different state. All disputes arising out of this Agreement shall be submitted to binding arbitration in accordance with the NGFA Rules. EACH PARTY HEREIN WAIVES ITS RESPECTIVE RIGHT TO ANY JURY TRIAL WITH RESPECT TO ANY LITIGATION ARISING UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY CONFIRMED ORDER.
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14.9
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Cumulative Remedies
.
Unless otherwise specifically provided in this Agreement, the rights, powers, and remedies of each of the Parties provided in this Agreement are cumulative and the exercise of any right, power or remedy under this Agreement does not affect any other right, power or remedy that may be available to either Party under this Agreement or otherwise at law or in equity.
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14.10
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No Partnership
.
This Agreement shall not create or be construed to create in any respect a partnership or any agency or joint venture relationship between the Parties.
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14.11
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Costs To Be Borne by Each Party
.
Producer and Gavilon shall pay its own costs and expenses incurred in the negotiation, preparation and execution of this Agreement and of all documents referred to in it.
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14.12
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Counterparts
.
This Agreement may be executed in any number of counterparts with the same effect as if Producer and Gavilon had signed the same document and all counterparts will be construed together and constituted as one and the same instrument.
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14.13
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Severability
.
Any provision of this Agreement, which is or becomes prohibited or unenforceable in any jurisdiction shall not invalidate or impair the remaining provisions of this Agreement, and the remaining terms of this Agreement shall continue in full force and effect.
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14.14
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Forward Contract/Forward Contract Merchants.
The Parties agree that each of them is a forward contract merchant as set forth in 11 U.S.C. §101 (25). The Parties also agree that this Agreement is a forward contract as defined in 11 U.S.C. §101 (25). The payments and transfers described herein shall constitute “
Settlement Payments
” or margin as set forth in 11 U.S.C. §§ 101 (51A) and (38).
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14.15
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Headings; Construction
.
The article and section headings used herein are for convenience of reference only and shall not affect the construction or interpretation of this Agreement. Unless the context of this Agreement otherwise requires, (i) words using the singular or plural number shall also include the plural or singular number, respectively; and (ii) the terms “hereof,” “herein,” “hereby,” “hereto,” and derivative or similar words shall refer to this entire Agreement. The Agreement is the product of negotiation by and among the Parties hereto. The Agreement shall be interpreted and constructed neutrally as to all Parties, without any Party deemed to be the drafter of the Agreement. Any word, phrase or expression that is not defined in this Agreement and that has a generally accepted meaning in the custom and usage in the renewable fuels industry shall have that meaning in this Agreement.
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14.16
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Waiver
. No delay or omission in the exercise of any right, power, or remedy hereunder shall impair such right, power, or remedy or be construed to be a waiver of any default or acquiescence therein.
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1.
|
I have reviewed this Amendment No. 1 to the annual report on Form 10-K of Heron Lake BioEnergy, LLC;
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2.
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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;
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Date:
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April 23, 2014
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/s/ Steve Christensen
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Steve Christensen
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Chief Executive Officer
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(principal executive officer)
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1.
|
I have reviewed this Amendment No. 1 to the annual report on Form 10-K of Heron Lake BioEnergy, LLC;
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2.
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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;
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Date:
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April 23, 2014
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/s/ Stacie Schuler
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Stacie Schuler
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Chief Financial Officer
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(principal financial officer and principal accounting officer)
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