Exhibit 10.1
*PORTIONS OF THIS AGREEMENT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR
CONFIDENTIAL TREATMENT WHICH HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION.
AGREEMENT
THIS AGREEMENT (this "Agreement") is made and entered into as October 13,
2006 by and between Southwest Iowa Renewable Energy, LLC, an Iowa limited
liability company ("Producer") and Bunge North America, Inc., a New York
corporation ("Bunge") (each of Producer and Bunge, a "Party" and collectively,
the "Parties").
A. Producer intends to construct and own an ethanol plant located near
Council Bluffs, Iowa (the "Facility").
B. As of the date of this Agreement, Bunge has subscribed to become a
Member of Producer pursuant to the Amended and Restated Operating Agreement of
Producer dated June 2, 2006 ("Operating Agreement").
X. Xxxxx owns and operates grain facilities in Council Bluffs, Iowa, from
which it currently conducts grain merchandising business (the "CB Elevator").
X. Xxxxx holds an equity interest in AGRI-Xxxxx, LLC, an Iowa limited
liability company ("A-B"). A-B and Producer are parties to a Grain Feedstock
Agency Agreement ("Agency Agreement") under which A-B is acting as Producer's
agent in procuring corn for the Facility meeting the specifications described in
the Agency Agreement ("Corn").
X. Xxxxx and Producer desire to set forth certain agreements regarding the
use of the CB Elevator.
NOW, THEREFORE, the Parties agree as follows:
1. CB Elevator.
1.1 Sale to City. Bunge shall use commercially reasonable efforts from and
after the date of this Agreement to sell the CB Elevator to the City of Council
Bluffs (the "City") upon such terms and at such price as Bunge deems acceptable
in its sole discretion. Producer agrees to publicly support Bunge's efforts to
sell the CB Elevator to the City and to not take any actions or release any
statements inconsistent with such efforts.
1.2 Sale or Lease to Third Party. If Bunge is unsuccessful in selling the
CB Elevator to the City, Bunge may elect at any time during the term of this
Agreement to sell or lease the CB Elevator to a third party; provided, that
Producer shall have a right of first refusal to purchase or lease the CB
Elevator at the same price and on the same terms as Bunge proposes for the sale
or lease of the CB Elevator to a third party. Producer shall have a period of 30
days after written notice from Bunge to Producer describing the terms and price
for the sale or lease to a third party ("Sale Notice") to exercise its right of
first refusal to purchase or lease the CB Elevator by delivering written notice
of exercise to Bunge ("Exercise Notice"). If Producer does not deliver an
Exercise Notice within such 30-day period after the Sale Notice (or Producer
provides written notice of election not to exercise its right of first refusal),
Bunge shall be free to sell the CB
Elevator to the proposed third party upon the terms and at the price stated in
the Sale Notice. If Bunge has not sold or leased the CB Elevator within 60 days
after Producer's failure to deliver an Exercise Notice (or 60 days after
Producer's notice not to exercise its right), the CB Elevator may not be sold
without again complying with this Section 1.2. If Producer delivers an Exercise
Notice to Bunge, Producer shall complete its purchase or lease of the CB
Elevator within 60 days after the Exercise Notice upon the terms contained in
the Sale Notice. Unless Bunge sells or leases the CB Elevator in accordance with
Sections 1.1 or 1.2, Bunge and Producer may, at Producer's sole discretion,
negotiate terms mutually agreeable to the parties for Producer to lease the CB
Elevator for standby storage of Corn.
2. Restrictions in Facility Service Area.
2.1 Restriction on Corn Activities. After the Restriction Date, none of
Bunge or any Affiliate of Bunge ("Bunge Entity") will *.
* OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT WHICH HAS BEEN FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
2.2 Restriction on Ethanol Investments. No Bunge Entity will invest (either
directly or indirectly) in an ethanol production facility within the Facility
Service Area; provided, that this restriction does not prohibit the acquisition
by a Bunge Entity of a business or entity which has invested in an ethanol
production facility to the extent that such investment constitutes a de minimis
portion of the value or activities of such business or entity.
2.3 Definitions. For purposes of this Agreement: (a) the term "Affiliate"
means a Person that directly, or indirectly through one or more intermediaries,
controls or is controlled by, or is under common control with, the party
specified, with "control" or "controlled" meaning the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities or
voting interests, by contract or otherwise; (b) the term "Person" shall mean any
individual, general partnership, limited partnership, limited liability company,
joint venture, trust, business trust, cooperative, association or other entity
of whatever nature; and (c) the term "Restriction Date" shall mean the date that
the Facility first becomes ready for delivery of Corn to the Facility; provided,
that Producer will notify Bunge at least thirty (30) days in advance of such
date. For purposes of this Agreement, A-B shall not be deemed an Affiliate of
Bunge.
3. Term and Termination. The initial term of this Agreement will begin upon
the execution of this Agreement by both Parties and will terminate: (a) upon
agreement in writing by both parties; and/or (b) immediately upon termination of
the Agency Agreement (unless due to a breach by A-B of its duties under the
Agency Agreement). Notwithstanding the foregoing, the provisions of Section 2
will continue in full force and effect for so long as the provisions of Section
1.5 of the Agency Agreement are in effect.
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4. Representation. Each Party represents and warrants to the other Party
that the execution, delivery and performance of this Agreement by it does not,
and will not, violate or constitute a breach of or default under any indenture,
contract or other instrument to which it, its Affiliates or its assets are bound
or to which its business is subject.
5. Governing Law; Disputes.
5.1 Governing Law. This Agreement shall be governed by the laws of the
state of Iowa, without regard to principles of conflicts of laws.
5.2 Notice of Dispute. If any dispute shall arise under or in connection
with this Agreement, the Parties hereto agree to follow the procedures set forth
in this Section 5 in an effort to resolve the dispute prior to the commencement
of any formal proceedings; provided, however, that either Party may institute
judicial proceedings seeking equitable relief or remedies without following the
procedures set forth herein. The Parties shall attempt in good faith to resolve
any dispute arising out of or relating to this Agreement, the breach,
termination, or validity hereof, or the transactions contemplated herein
promptly by negotiation between representatives who have authority to settle the
controversy. Any Party may give the other Party written notice that a dispute
exists (a "Notice of Dispute") setting forth a statement of such Party's
position. Within twenty (20) business days of the delivery of the Notice of
Dispute, representatives of the Parties shall meet at a mutually acceptable time
and place, and thereafter as long as they both reasonably deem necessary, to
exchange relevant information and attempt to resolve the dispute. If the matter
has not been resolved within thirty (30) days of the disputing party's
delivering its Notice of Dispute, the dispute shall be referred to the Board of
Managers of Producer and the chief executive officer of Bunge who shall within
twenty (20) additional days meet to attempt in good faith to resolve the
dispute.
5.3 Mediation. If the matter still has not been resolved within sixty (60)
days of the delivery of the Notice of Dispute, then any Party may seek to
resolve the dispute through mediation administered by the Commercial Mediation
Rules of the American Arbitration Association. If the Parties fail to resolve
the dispute within twenty-one (21) days after starting mediation, then either
Party may initiate appropriate proceedings to obtain a judicial resolution of
the dispute.
5.4 Negotiations; Jurisdictional Matters. If a representative of any Party
intends to be accompanied at a meeting by an attorney, the other negotiator
shall be given at least three (3) business days' notice of such intention and
may also be accompanied by an attorney. All negotiations pursuant to this clause
are confidential and shall be treated as compromise and settlement negotiations
for purposes of the Federal Rules of Evidence and similar state rules of
evidence. Any proceeding initiated by either Party hereto shall be commenced and
prosecuted in the United States District Courts for the Eastern District of
Missouri or the Western District of Iowa or the state courts in St. Louis
County, Missouri or Des Moines, Iowa, and any courts to which an appeal may be
taken, and each Party hereby consents to and submits to the personal
jurisdiction of each of such courts.
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5.5 Waiver of Jury Trial. EACH PARTY IRREVOCABLY WAIVES ANY AND ALL RIGHTS
TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
6. Notices. All notices required or permitted under this Agreement will be
in writing and will be deemed given and made: (i) if by personal delivery, on
the date of such delivery, (ii) if by facsimile, on the date sent (as evidenced
by confirmation of transmission by the transmitting equipment), (iii) if by
nationally recognized overnight courier, on the next business day following
deposit, and (iv) if by certified mail, return receipt requested, postage
prepaid, on the third business day following such mailing; in each case
addressed to the address or facsimile number shown below for such Party, or such
other address or facsimile number as such Party may give to the other Party by
notice:
If to Bunge:
Xxxxx North America, Inc.
00000 Xxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: Senior Vice President - Bunge Grain
Facsimile: (000) 000-0000
with copies to:
Xxxxx North America, Inc.
00000 Xxxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attn: General Counsel
Facsimile: (000) 000-0000
If to Producer:
Southwest Iowa Renewable Energy, LLC
000 X. Xxx 0, XX Xxx 000
Xxxxxxx, XX 00000-0000
Attn: General Manager
with copies to:
Xxxxx X. Xxxxxxx
Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
0000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxx, XX 00000
Facsimile: (000) 000-0000
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7. Entire Agreement; No Third Party Beneficiaries. This Agreement
constitutes the entire agreement between the Parties with respect to the subject
matter hereof and supersedes all prior agreements and understandings, both
written and oral, between the Parties with respect to the subject matter hereof.
This Agreement does not, and is not intended to, confer any rights or remedies
upon any person other than the Parties (or their Affiliates, successors,
assignees or subcontractors to the extent set forth herein).
8. Amendments; Waiver. The Parties may amend this Agreement only by a
written agreement of the Parties. No provision of this Agreement may be waived,
except as expressly provided herein or pursuant to a writing signed by the Party
against whom the waiver is sought to be enforced. No failure or delay in
exercising any right or remedy or requiring the satisfaction of any condition
under this Agreement, and no "course of dealing" between the Parties, operates
as a waiver or estoppel of any right, remedy or condition. A waiver made in
writing on one occasion is effective only in that instance and only for the
purpose that it is given and is not to be construed as a waiver on any future
occasion or against any other person.
9. Severability. If a court or arbitrator with proper jurisdiction
determines that any provision of this Agreement is illegal, invalid, or
unenforceable, the remaining provisions of this Agreement remain in full force.
The Parties will negotiate in good faith to replace such illegal, invalid, or
unenforceable provision with a legal, valid, and enforceable provision that
carries out the Parties' intentions to the greatest lawful extent under this
Agreement.
10. Interpretation. Each Party has been represented by counsel during the
negotiation of this Agreement and agrees that any ambiguity in this Agreement
will not be construed against one of the Parties.
11. Counterparts. This Agreement may be executed by the Parties by
facsimile and in separate counterparts, each of which when so executed will be
deemed to be an original and all of which together will constitute one and the
same agreement.
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed the
day and year first above written.
BUNGE NORTH AMERICA, INC. SOUTHWEST IOWA RENEWABLE
ENERGY, LLC
By: /s/ Xxxxxx Xxxxx By: /s/ Xxxxx X. Xxxxx
-------------------------------- --------------------------------------
Name: Xxxxxx Xxxxx Name: Xxxxx X. Xxxxx
Title: Vice President Title: Chairman
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