Exhibit 10-19
Page 1 of 4
EXCLUSIVE GRAIN SUPPLY AGREEMENT
AGREEMENT made this ___ day of June, 1995, by and between
Farmland Industries, Inc., a Kansas corporation having its
principal offices at 0000 X. Xxx Xxxxxxxxxx, Xxxxxx Xxxx,
Xxxxxxxx ("Farmland") and High Plains Corporation, 000 X. Xxxxx
Xx., Xxx 000, Xxxxxxx, Xxxxxx 00000 ("High Plains").
WHEREAS, Farmland is a seller of grain in the States of Kansas
and Nebraska; and
WHEREAS, High Plains is a purchaser of grain for use at its
Colwich, Kansas and York, Nebraska plants; and
WHEREAS, both Farmland and High Plains desire to enter into an
exclusive supply agreement for the sale of grain by Farmland to
High Plains for use at the Colwich, Kansas and York, Nebraska,
plants.
NOW, THEREFORE, in consideration of the mutual agreements and
other good and valuable consideration hereinafter set forth, the
parties agree as follows:
1. SALE OF PRODUCTS. This Agreement applies to all grain
purchased by High Plains for use at its Colwich, Kansas and
York, Nebraska, plants (the "Grain"). High Plains agrees to buy
all of its requirements of Grain from Farmland for the term of
this Agreement. Farmland agrees to sell, subject to
availability, such Grain to High Plains for the term of this
Agreement. Farmland and High Plains agree that such purchases
will be at terms, conditions and price as agreed upon quarterly
or as otherwise necessary depending on High Plains' demand
during the term of this Agreement. At each quarter, Farmland, at
a minimum, will price Grain at 90 days supply for High Plains'
consideration and, at High Plains' option, will price an
additional 120 days supply. Farmland agrees to provide to High
Plains up to five million bushels warehouse receipts at tariff
storage rates.
2. FORECAST INFORMATION. Farmland agrees to provide High Plains
with quarterly feedgrain analyses and other forecast information
available from third-parties to assist High Plains in its
purchase decisions. However, regardless of any price or purchase
recommendations or forecasts provided by Farmland, High Plains
remains solely responsible for its purchasing decisions and any
gains or losses resulting from those decisions. FARMLAND
PROVIDES NO WARRANTY AS TO ANY PRIClNG INFORMATION, FORECASTS OR
PURCHASE RECOMMENDATIONS.
3. PRICE. Farmland agrees to sell to High Plains at a fixed
price, F.O.B. Colwich, Kansas or York, Nebraska. Farmland will
absorb the costs of all xxxxxx, commissions, freight,
transportation, and inventory carry charges prior to delivery.
4. PAYMENT. Payment for purchases under this Agreement are due
weekly. Farmland agrees to accept a demand letter of credit in
lieu of cash for a period of 30 days.
5. TERM. This Agreement shall commence on July 1, 1995 and
continue for one year. After the first year, the Agreement shall
automatically renew for one-year terms. However, either party
may terminate this Agreement at any time upon giving the other
party thirty (30) days notice of termination in writing. This
Agreement may be terminated immediately by Farmland if (i) High
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Plains' financial responsibility becomes impaired, (ii) it makes
an assignment or arrangement for benefit of creditors or (iii)
it files a petition in bankruptcy or has such petition filed
against it.
Upon expiration, termination, or cancellation of this Agreement,
neither party shall have any rights or obligations or liability
to the other party with respect to this Agreement except for (a)
the obligation to make full payment of any outstanding monetary
obligations owed to the other party which monetary obligation
was incurred prior to the date of such expiration, termination
or cancellation, and (b) obligations under any Grain contract
which existed prior to such expiration, termination or
cancellation of this Agreement.
6. EMPLOYEES Each party shall be solely responsible for the acts
and inactions of its employees acting within the course and
scope of their employment by such party and each party shall be
solely responsible for the salary, wages and payroll taxes for
its employees and shall maintain Workers' Compensation Insurance
on its employees as required by applicable state law. The
parties shall have no joint employees as a result of this
Agreement and neither party shall incur any responsibility or
liability whatsoever with respect to, or for the acts or
inactions of, the employees of the other party as a result of
this Agreement.
7. INDEMNIFICATION. Farmland shall indemnify and hold High
Plains, and its affiliates, subsidiaries, parents, directors,
officers, employees and agents harmless from and against any and
all claims, losses, awards, judgments, settlements, fines,
penalties, liabilities, damages, costs or expenses (including
attorneys' fees) alleged or incurred on account of any injury or
death of persons or damages to property or any other claim to
the extent caused by or arising out of the negligent acts or
omissions of Farmland, its officers, agents or employees, or any
breach by Farmland, its officers, agents or employees, of any of
the terms of this Agreement, or any representations by Farmland
which are not authorized pursuant to this Agreement or pursuant
to specific instructions given to Farmland by High Plains.
High Plains shall indemnify and hold Farmland, and its
affiliates, subsidiaries, parents, directors, officers,
employees and agents harmless from and against any and all
claims, losses, awards, judgments, settlements, fines,
penalties, liabilities, damages, costs or expenses (including
attorneys' fees) alleged or incurred on account of any injury or
death of persons or damages to property or any other claim to
the extent caused by or arising out of the negligent acts or
omissions of High Plains, its officers, agents or employees, or
any breach by High Plains, its officers, agents, or employees,
of any of the terms of this Agreement, or any representations by
High Plains which are not authorized pursuant to this Agreement
or pursuant to specific instructions given to High Plains by
Farmland.
8. FORCE MAJEURE. Neither party shall be liable for failure to
perform or for delay in performing this Agreement, other than
for all existing debt, where such failure or delay is occasioned
by (a) fire, explosion, breakdown of plant, failure of
machinery, strike, lock-out, labor dispute, casualty or
accident, or lack or failure in whole or in part of
transportation facilities, (b) storm, flood or drought, (c) lack
or failure in whole or in part of the sources of supply (other
than Grain), labor, or power or other utilities, (d) acts of God
or of the public enemy, war, riots, police action, or civil
commotion, (e) any law, regulation, ordinance, demand, judgment,
injunction, arbitral award, or other requirement or regulation
of any government or government agency or instrumentality or (f)
any other act whatsoever, whether similar or dissimilar to those
above-enumerated, beyond the reasonable control of the party
suffering such event of force majeure. The party asserting that
an event of force majeure has occurred shall send the other
party notice thereof
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by cable, telecopy or telex no later than three (3) days after
the beginning of such claimed event setting forth a description
of the event of force majeure, an estimate of its effect upon
the party's ability to perform its obligations under this
Agreement and the duration thereof. The notice shall be
supplemented by such other information or documentation as the
party receiving the notice may reasonably request. As soon as
possible after the cessation of any event of force majeure, the
party which asserted such event shall give the other party
written notice of such cessation. Whenever possible, each party
shall give the other party notice of any threatened or impending
event of force majeure.
9. ALTERNATE DISPUTE RESOLUTION. This contract is subject to the
National Grain and Feed Association Grain Trade Rules and
Arbitration Rules. Any controversy arising out of, or relating
to, the Agreement between the parties or any modification or
extension thereof, including any claim for damages or
rescission, or both, shall be settled by arbitration in
accordance with those rules unless the parties should agree
otherwise in writing. The parties further agree that arbitration
proceedings must be instituted within one year after the
occurrence of the claimed breach, and that the failure to
institute arbitration proceedings within such time period shall
constitute an absolute bar to the institution of any proceedings
and a waiver of all claims. All fees for such arbitration will
be divided equally between the parties except that each party
shall pay its own attorney's fees and the costs associated with
producing documents and other information.
10. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the substantive laws of the State
of Missouri without giving affect to the choice of law rules
thereof. The parties consent to the jurisdiction of the Courts
of the State of Missouri and of the United States District Court
for the Western District of Missouri for all purposes in
connection with the above arbitration.
11. NOTICES. All notices, consents and other communications
under this Agreement shall be in writing and shall be deemed to
have been duly given when delivered in person or deposited in
the United States mail (registered or certified), postage
prepaid or deposited with a reputable overnight delivery
service, with delivery charges prepaid, in each case addressed
or transmitted to the appropriate address as follows (or as
otherwise designated by a party as to itself by notice to the
other party given in accordance with this section):
If to Farmland: Farmland Industries, Inc.
00000 X. Xxxxxxxxx Xxxxx Xxxx.
Xxxxxx Xxxx, Xxxxxxxx 00000
Attn: Vice President Grain
If to High Plains: High Plains Corporation
000 X. Xxxxx Xx.
Xxx 000
Xxxxxxx, Xxxxxx 00000
Attn: _______________________
12. INSURANCE. The parties shall maintain the following
insurance at all times while this Agreement is in effect:
a. Statutory Worker's Compensation and Employer's Liability
Insurance in compliance with the laws of the states
where the work is being performed.
Exhibit 10-19
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b. Comprehensive General Liability Insurance as follows:
i. Bodily injury liability in an amount of not less than
$1,000,000 for injuries, including death, in any one
occurrence.
ii. Property damage liability in an amount of not less
than $1,000,000 covering damage to or destruction
of property in any one occurrence.
iii.Automotive public liability insurance in an amount of
not less than $1,000,000 for bodily injuries, including death, in
any one occurrence, and in an amount of not
less than $1,000,000 covering damage to property
in any one occurrence.
The foregoing liability insurance coverage shall include
coverage for contractual liability under this Agreement. The
insurance requirements set forth herein are minimum coverage
requirements and are not to be construed in any way as a
limitation on liability under this Agreement.
13. WARRANTIES. EXCEPT AS SET FORTH ABOVE, FARMLAND BY THIS
AGREEMENT MAKES NO WARRANTIES, EXPRESS OR IMPLIED BY OPERATION
OF LAW OR OTHERWISE, INCLUDING BUT NOT LIMITED TO ANY WARRANTY
OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
14. ASSIGNMENT. This Agreement shall not be assigned by either
party without the written consent of the other party, and any
attempted assignment without such consent shall be ineffective.
15. ENTIRE AGREEMENT. This Agreement contains the entire
agreement between the parties and supersedes all previous
agreements either oral or written, between the parties hereto,
and no modifications hereof shall be valid unless made in
writing and signed by the parties hereto.
IN WITNESS WHEREOF, the parties hereto have set their hands and
seals the day and year above written.
THIS CONTRACT CONTAINS A BINDING ARBlTRATION PROVISION WHICH MAY
BE ENFORCED BY THE PARTIES.
HIGH PLAINS CORPORATION
By: Xxxxxxx X. Xxxxxx
Title: President, C.E.O.
FARMLAND INDUSTRIES, INC.
By: Xxxxx Xxxxx
Title: Director Grain Division
