DISTILLER’S GRAINS MARKETING AGREEMENT
THIS DISTILLER’S GRAINS MARKETING AGREEMENT (the “Agreement”), made and entered into this 3rd
day of November, 2006, by and among One Earth Energy, LLC, an Illinois limited liability company
(“One Earth Energy”), and United Bio Energy Ingredients, LLC, a Kansas limited liability company
(“UBE”).
WITNESSETH:
WHEREAS, One Earth Energy desires to sell and UBE desires to buy all the distiller’s grains
(the “Distiller’s Grains”) produced at One Earth Energy’s ethanol plant located at Xxxxxx City,
Illinois (the “Plant”);
WHEREAS, the parties desire to purchase and sell such assets, and receive and provide such
services, in accordance with the fees, price formula, payment, delivery and other terms set forth
in this Agreement.
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants and
conditions herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by both parties, it is hereby agreed:
1. COMMITMENT AND TERM. Subject to the terms of this Agreement, One Earth Energy
hereby agrees to sell, and UBE hereby agrees to purchase, all Distiller’s Grains produced at the
Plant. The initial term of this Agreement shall be for thirty-six (36) months, commencing on the
date that the Plant begins operations to produce ethanol. The parties shall execute a memorandum
setting forth the actual date of commencement of the term. This Agreement shall be automatically
renewed for successive one (1) year terms thereafter unless either party gives written notice to
the other party of its election not to renew, not later than ninety (90) days prior to the
expiration of the initial term or the then current renewal term, as the case may be.
2. PRICE AND PAYMENT.
A. PRICE. UBE will provide Comprehensive Coproducts Marketing Services to One Earth
Energy which shall include an onsite merchandiser at the Plant. For the purposes of this
Agreement, the term “F.O.B. Facility Price” shall mean the actual net sales price that UBE invoices
buyers of Distiller’s Grains. Fees begin with Plant startup and include all logistical shipment
coordination, administration of sales contracts and assumption of accounts receivable and credit
risk. Rail car lease costs will be at an additional cost to One Earth Energy dependent upon
utilization of rail for shipments of coproducts. Freight costs and insurance will be at an
additional cost to One Earth Energy.
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UBE shall pay One Earth Energy for all Distiller’s Grains removed by UBE from the Plant as
follows: for DDGS, a price equal to Ninety Seven Percent (97.0%) of the F.O.B. Facility Price
charged by UBE to its customers; for WDGS, a price equal to Ninety Six Percent (96.0%) of the
F.O.B. Facility Price charged by UBE to its customers; for WMGS, a price equal to Ninety Five
Percent (95.0%) of the F.O.B. Facility Price charged by UBE to its customers.
The percentages described above are subject to a minimum and maximum per ton, as per the
following chart example:
| Commission | Commission | |||||||||||||||
| Sales Price | Min Cap | Sales Price | Max Cap | |||||||||||||
| Coproduct | Per Ton | Per Ton | Per Ton | Per Ton | ||||||||||||
DDGS
|
$ | 41.75 | 1.25 | $ | 100.00 | 3.00 | ||||||||||
WDGS
|
$ | 18.75 | 0.75 | $ | 45.00 | 1.80 | ||||||||||
WMGS
|
$ | 20.00 | 1.00 | $ | 46.00 | 2.30 | ||||||||||
Using the example above, assuming 1,000 tons of DDGS are sold, if the Sales Price Per Ton
falls below $41.75 to $40.00, UBE’s commission will be capped at the 1.25 per ton minimum and UBE’s
commission will remain the same as if the sales price were $41.75, i.e., $1,250.00. Assuming 1,000
tons of DDGS are sold at the Sales Price Per Ton of $125.00, UBE’s commission will be capped at the
3.00 per ton maximum Sales Price Per Ton of $100.00, or $3,000.00.
B. PAYMENT. On a daily basis, Weekends and Holidays excluded, One Earth Energy shall
provide UBE with certified weight certificates for the previous day’s shipments of Distiller’s
Grains. UBE shall pay One Earth Energy the F.O.B. Plant Price defined in paragraph 2.A. above, for
all properly documented shipments. Payment for such shipments shall occur so that payment for all
shipments in each one week shipment period (Sunday through Saturday) is received on or before the
second following Friday of such one week shipment period. UBE agrees to maintain accurate sales
records and to provide such records to One Earth Energy upon request. One Earth Energy shall have
the right to audit UBE’s sales invoices at any time during normal business hours at the corporate
office of UBE.
C. SALES CONFIRMATION. Each week’s Distiller’s Grains sales shall be evidenced by a
separate sales confirmation substantially in the form of Exhibit A attached hereto (“Sales
Confirmation”). Each Sales Confirmation shall at a minimum specify the quantity and quality of the
Distiller’s Grains; the delivery date; the purchase price; any applicable discount from the
purchase price; and such other information as the Parties may agree to include. Upon receipt of
the Sales Confirmation, the Plant must execute and return the Sales Confirmation within three (3)
business day(s) to UBE. If the Plant fails to respond by execution and return of the Sales
Confirmation to UBE within three (3) business day(s) of its receipt of the same, said non-response
shall be deemed to be an acceptance of the Sales Confirmation.
D. BEST EFFORTS. UBE agrees to use its best efforts to achieve the highest resale
price of Distiller’s Grains available under prevailing market conditions as judged by UBE.
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One Earth Energy’s sole and exclusive remedy for breach of UBE’s obligations hereunder shall be to
terminate this Agreement.
E. COLLECTION. UBE shall be responsible for all customer billing and account
servicing, including, but not limited to, the collection of amounts owed UBE by its customers,
shall bear all costs associated with such billing and collection activities, and shall assume all
losses due to failure of its customers to pay their account.
F. FUTURE SALES BY UBE. UBE shall not contract for the sale of Distiller’s Grains, to
its customers, more than one hundred eighty (180) days in advance, unless One Earth Energy
explicitly approves the price and terms of any such contract and provides notice of such approval
to UBE. UBE will advise One Earth Energy weekly and update One Earth Energy monthly on all
outstanding contractual obligations, and the terms thereof.
3. FEES AND EXPENSES. Unless otherwise specifically provided for herein, and to the
extent not already included in the price of the Distiller’s Grains, One Earth Energy shall be
responsible for any and all fees and reasonable and normal expenses, including but not limited to
fees assessed by any State or other regulatory agency, incurred or assessed on any Distiller’s
Grains, whether for licensing, dues, branding, packaging, inspecting, or otherwise. One Earth
Energy shall, as a result of its responsibility for such expenses, retain all rights to any name,
branding, and packaging of the Distiller’s Grains upon termination of this Agreement.
4. DELIVERY AND TITLE.
A. PLACE. The place of delivery for all Distiller’s Grains purchased by UBE pursuant
to this Agreement shall be F.O.B. Plant. UBE and its agents shall be given access to the Plant in
a manner and at all times reasonably necessary and convenient for UBE and One Earth Energy to make
delivery as provided herein. UBE shall schedule the loading and shipping of all Distiller’s Grains
purchased hereunder. All labor and equipment necessary to load or unload trucks and rail cars
shall be supplied by One Earth Energy without charge to UBE. The parties agree to handle the
Distiller’s Grains in a good and workmanlike manner in accordance with the other’s reasonable
requirements and in accordance with normal industry practice. One Earth Energy shall maintain the
truck loading and rail car loading facilities in safe operating condition in accordance with normal
industry standards.
B. STORAGE. One Earth Energy shall provide storage space for not less than ten (10)
full days production of Distiller’s Grains, based on normal operating capacity.
C. REMOVAL. UBE warrants and agrees to use its best efforts to remove Distiller’s
Grains before the aforementioned storage limits are exceeded or, if later, three (3) days after
notice from One Earth Energy that the Plant’s operations are adversely affected by such storage.
One Earth Energy shall be responsible at all times for the quantity, quality and condition of any
Distiller’s Grains in storage at the Plant.
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D. LOADING AND UNLOADING SCHEDULE. UBE shall give to One Earth Energy a schedule of
quantities of Distiller’s Grains to be removed by truck or rail with sufficient advance notice
reasonably to allow One Earth Energy to provide the required services. One Earth Energy shall
provide the labor, equipment and facilities necessary to meet UBE’s loading schedule and One Earth
Energy shall be responsible for UBE’s actual costs or damages resulting from One Earth Energy’s
failure to do so. UBE shall order and supply trucks or railcars as scheduled for truck or rail
shipments. All freight charges shall be the responsibility of UBE and shall be billed directly to
UBE.
E. PRODUCTION SCHEDULE.
1. UBE shall provide loading orders as necessary to permit One Earth Energy to maintain its
usual production schedule, provided, however, that UBE shall not be responsible for failure to
schedule removal of Distiller’s Grains unless One Earth Energy shall have provided to UBE
production schedules as follows: At least five (5) days prior to the beginning of each calendar
month during the term hereof, One Earth Energy shall provide to UBE a tentative schedule for
production in the next calendar month. On Wednesday of each week during the term of this
Agreement, One Earth Energy shall provide to UBE a schedule for actual production for the following
production week (Monday through Sunday). One Earth Energy shall inform UBE daily of inventory and
production status by 8:30 a.m. CDT.
2. NOTICE. For purposes of this paragraph, notification will be sufficient if made by
facsimile as follows:
If to UBE for Distiller’s Grain, to the attention of Xxxxx Xxxx, Facsimile number
000-000-0000, Email address: xxxxx.xxxx@xxxxxxxxxxx.xxx; and
If to One Earth Energy, to the attention of , Facsimile
number
, Email address:
; or
To such other representatives of UBE and One Earth Energy as they may designate to
the other in writing.
F. TITLE. Title and risk of loss shall pass to UBE at the point in time when loading
the Distiller’s Grains into trucks or rail cars has been completed and delivery to UBE of the xxxx
of lading for each such shipment.
5. QUANTITY AND WEIGHTS.
A. PRODUCTION AMOUNT. It is understood that total production amount of Distiller’s
Grains shall be determined by One Earth Energy’s production schedule and that no
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warranty or representation has been made by One Earth Energy as to the exact quantities or timing
of Distiller’s Grains to be produced pursuant to this Agreement.
B. ESTIMATE. The estimated production of Distiller’s Grains at the Plant by One Earth
Energy, to be sold to UBE, is approximately twenty six thousand (26,000) tons of Distiller’s Grains
per month on a dry matter basis, and One Earth Energy shall use its best efforts to produce such
amount of Distiller’s Grains.
C. METERS AND SCALES. The quantity of Distiller’s Grains delivered to UBE from the
Plant shall be established by meter or weight certificates, obtained from meters or scales which
are certified as of the time of loading and which comply with all applicable laws, rules and
regulations. The outbound meter or weight certificates shall be determinative of the quantity of
the Distiller’s Grains for which UBE is obligated to pay pursuant to paragraph 2 above.
6. QUALITY.
A. STANDARDS. One Earth Energy understands that UBE intends to sell the Distiller’s
Grains purchased from One Earth Energy as a primary animal feed ingredient and that the same are
subject to minimum quality standards for such use and each shall be of merchantable quality. One
Earth Energy warrants that the Distiller’s Grains produced by the Plant and delivered to UBE shall
be acceptable under current industry standards in the feed trade industry and that at the time of
delivery, the Distiller’s Grains shall conform to the minimum quality standards outlined in
Exhibit B attached hereto, as may be amended from time to time.
B. COMPLIANCE. One Earth Energy represents and warrants that at the time of loading,
the Distiller’s Grains 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 said Act. Payment of invoices does not waive UBE’s rights if the Distiller’s Grains
do not comply with terms or specifications of this Agreement. Unless otherwise agreed between the
parties to this Agreement, and in addition to other remedies permitted by law, UBE may, without
obligation to pay, reject either before or after delivery, any of the Distiller’s Grains, which,
when inspected or used are found by UBE to fail in a material way to conform to this Agreement.
Should any of the Distiller’s Grains be seized or condemned by any federal or state department or
agency for any reason, except noncompliance by UBE with applicable federal or state requirements,
such seizure or condemnation shall operate as a rejection by UBE of the Distiller’s Grains seized
or condemned and UBE shall not be obligated to offer any defense in connection with the seizure or
condemnation. However, UBE agrees to cooperate with One Earth Energy in connection with the
defense of any quality or other product claims, or any claims involving governmental seizure or
condemnation. When rejection occurs before or after delivery, at its option, UBE may:
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(1) Dispose of the rejected Distiller’s Grains after first offering One Earth Energy a
reasonable opportunity of examining and taking possession thereof, if the condition of the
Distiller’s Grains reasonably appears to UBE to permit such delay in making disposition;
(2) Dispose of the rejected Distiller’s Grains in any manner directed by One Earth Energy
which UBE can accomplish without violation of applicable laws, rules, regulations or property
rights;
(3) If any of the Distiller’s Grains are seized or condemned by any federal or state
department or agency or if UBE has no available means of disposal of rejected Distiller’s Grains
and One Earth Energy fails to direct UBE to dispose of the same as provided herein, UBE’s
obligations with respect to said seized, condemned or rejected Distiller’s Grains shall be deemed
fulfilled. Title and risk of loss shall pass to One Earth Energy promptly upon such seizure or
condemnation or rejection by UBE.
(4) One Earth Energy shall reimburse UBE for all costs reasonably incurred by UBE in storing,
transporting, returning and disposing of the rejected Distiller’s Grains. UBE shall have no
obligation to pay One Earth Energy for rejected Distiller’s Grains and may deduct reasonable costs
and expenses to be reimbursed by One Earth Energy from amounts otherwise owed by UBE to One Earth
Energy.
C. NON-STANDARD PRODUCTS. If One Earth Energy produces Distiller’s Grains which
comply with the warranties in this paragraph, but which do not meet applicable industry standards,
UBE agrees to purchase such Distiller’s Grains for resale but makes no representation or warranty
as to the price at which such Distiller’s Grains can be sold. If the Distiller’s Grains deviate so
severely from industry standards as to be unmarketable in UBE’s reasonable judgment, then it shall
be disposed of in the manner provided for rejected Distiller’s Grains in this paragraph.
D. PRODUCT TESTING. If One Earth Energy knows or reasonably suspects that any
Distiller’s Grains produced by the Plant are adulterated or misbranded, or, are outside of minimum
quality standards set forth in Exhibit B, One Earth Energy shall promptly so notify UBE
so that such Distiller’s Grains can be tested before entering interstate commerce. If UBE knows or
reasonably suspects that any Distiller’s Grains produced by the Plant are adulterated or
misbranded, or, are outside of minimum quality standards set forth in Exhibit B, then UBE
may obtain independent laboratory tests of the affected Distiller’s Grains. If such Distiller’s
Grains are tested and found to comply with all warranties made by One Earth Energy herein, then UBE
shall pay all testing costs and if the Distiller’s Grains are found not to comply with such
warranties, One Earth Energy shall pay all testing costs.
E. CHANGES IN STANDARDS. The quality standards in Exhibit B are subject to
change as may be mutually agreed in writing by and between the parties, provided, however, that
such changes shall be in conformance with generally acceptable industry standards.
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7. RETENTION OF SAMPLES.
A. SAMPLING. One Earth Energy will take an origin sample of the Distiller’s Grains
from each truck before each shipment leaves the Plant, using industry standard sampling
methodology. One Earth Energy will label these samples to indicate the date of shipment that the
truck or pickup number involved. One Earth Energy shall also retain the samples and labeling
information for no less than ninety (90) days for dry Distiller’s Grains and for no less than
fourteen (14) days for wet Distiller’s Grains and modified wet Distiller’s Grains.
B. ANALYSIS. For the first year of operation of ethanol production at the Plant, One
Earth Energy shall, on a weekly basis, furnish UBE with a composite analysis on all Distiller’s
Grains produced at the Plant. It is understood that said analysis is a composite and may or may
not be indicative of the current analysis.
8. INSURANCE.
A. POLICIES. One Earth Energy warrants to UBE that all One Earth Energy’s employees
shall be covered as required by law by worker’s compensation and unemployment compensation
insurance, and such worker’s compensation insurance shall provide a waiver of subrogation on behalf
of UBE.
B. COVERAGES. During the term of this Agreement, One Earth Energy shall purchase and
maintain insurance upon the Plant in such amounts as it may reasonably determine. UBE shall be
named as an additional insured on all such policies. All such policies shall contain
provisions to the effect that in the event of payment of any loss or damage the insurers will have
no rights of recovery against any of the insureds or additional insureds thereunder. One Earth
Energy waives all rights against UBE and its employees and agents for all losses and damages caused
by, arising out of or resulting from any of the perils or causes of loss covered by such policies
and any other property insurance applicable to the Plant.
C. UBE VEHICLES. UBE agrees to carry such insurance on its vehicles and personnel
operating on One Earth Energy’s property as UBE reasonably deems appropriate. The parties
acknowledge that UBE may elect to self insure its vehicles. Upon request, UBE shall provide a
certificate of insurance to One Earth Energy to establish the coverage maintained by UBE.
D. CONSEQUENTIAL DAMAGES. EACH PARTY TO THIS AGREEMENT UNDERSTANDS THAT NO OTHER
PARTY MAKES ANY GUARANTEE, EXPRESS OR IMPLIED, TO ANY OTHER OF PROFIT, OR OF ANY PARTICULAR
ECONOMIC RESULTS FROM TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. IN NO EVENT SHALL ANY PARTY BE
LIABLE FOR SPECIAL, COLLATERAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES FOR ANY ACT OR OMISSION COMING
WITHIN THE SCOPE OF THIS AGREEMENT, OR FOR BREACH OF
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ANY OF THE PROVISIONS OF THIS AGREEMENT, EVEN IF IT HAS BEEN ADVISED OF THE POSSIBILITY OF
SUCH DAMAGES, SUCH EXCLUDED DAMAGES INCLUDE, BUT ARE NOT LIMITED TO, LOSS OF GOOD WILL, LOSS OF
PROFITS, LOSS OF USE, AND INTERRUPTION OF BUSINESS.
E. OTHER CLAIMS. Except as provided in paragraph 8.D above, nothing herein shall be
construed as a waiver by either party against the other party of claims, causes of action or other
rights which either party may have or hereafter acquire against the other party for damage or
injury to its agents, employees, invitees, property, equipment or inventory, or third party claims
against the other party for damage or injury to other persons or the property of others.
9. REPRESENTATIONS AND WARRANTIES.
A. Each party represents and warrants that it is an entity in good standing under the laws
that it is organized and has all the requisite power and authority to carry on its business as it
has been and to own, lease, and operate the properties and assets used in connection therewith.
B. In addition to the representations and warranties herein regarding the quality of
Distiller’s Grains, One Earth Energy represents and warrants that the Distiller’s Grains delivered
to UBE shall be free and clear of liens and encumbrances.
C. Each individual executing this Agreement in a representative capacity, by his or her
execution hereof, represents and warrants that such person is fully authorized to do so on behalf
of the respective party hereto, and that no further action or consent on the part of the party for
whom such signatory is acting is required for the effectiveness and enforceability of this
Agreement against such party, following such execution.
10. TERMINATION FOR CAUSE. Either party may terminate this Agreement without
liability for cause by providing thirty (30) days prior written notice to the other party. For
purposes of this paragraph, “cause” shall include, but not be limited to, the happening of an event
of default discussed in paragraph 11 below, or any other material breach of any provision of this
Agreement, or material violation of any applicable law, regulation or ruling.
11. EVENTS OF DEFAULT. The occurrence of any of the following shall be an event of
default under this Agreement: (1) failure of either party to make payment to the other when due,
if such nonpayment has not been cured within five (5) days of written notice thereof; (2) default
by either party in the performance of any material covenant, condition or agreement imposed upon
that party by this Agreement, if such nonperformance has not been cured within five (5) days of
written notice thereof; (3) if either party shall become insolvent, or make a general assignment
for the benefit of creditors or to an agent authorized to liquidate any substantial amount of its
assets, or be adjudicated bankrupt, or file a petition in bankruptcy and such petition is not
dismissed within ninety (90) days following the date of filing, or apply to a
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court for the appointment of a receiver for any of its assets or properties with or without
consent, and such receiver shall not be discharged within sixty (60) days following appointment.
12. REMEDIES. Upon the happening of an event of default under paragraph 11, the
parties hereto shall have all remedies available under applicable law with respect to an event of
default by the other party, including but not limited to the recovery of attorneys’ fees and other
costs and expenses. Without limiting the foregoing, the parties shall have the following remedies
whether in addition to or as one of the remedies otherwise available to them: (1) to declare all
amounts owed immediately due and payable; and (2) to terminate this Agreement in accordance with
the provisions of paragraph 10. Notwithstanding any other provision of this Agreement, UBE may
offset against amounts otherwise owed to One Earth Energy the price of any Distiller’s Grain which
fail to conform to any requirements of this Agreement.
13. OPEN CONTRACTS. Upon the termination of this Agreement, for whatever reason, One
Earth Energy shall assume and be responsible for delivering any remaining quantities of Distiller’s
Grains required to be delivered by UBE to its customers pursuant to UBE’s contracts with the same,
provided such contracts are to be delivered by UBE from the Plant. Prior to the termination of
this Agreement, UBE shall provide One Earth Energy with a listing of all such contracts and the
quantities of Distiller’s Grains to be delivered pursuant to the same to assist One Earth Energy in
completing deliveries under these open contracts. One Earth Energy agrees to assist UBE in the
collection of amounts owed to UBE from those customers receiving deliveries of Distiller’s Grains
from UBE prior to the termination of this Agreement.
14. FORCE MAJEURE. Neither One Earth Energy nor UBE will be liable to the other for
any failure or delay in the performance of any obligation under this Agreement due to events beyond
its reasonable control, including, but not limited to, fire, storm, flood, earthquake, explosion,
act of the public enemy or terrorism, riots, civil disorders, sabotage, strikes, lockouts, labor
disputes, labor shortages, war, stoppages or slowdowns initiated by labor, transportation
embargoes, failure or shortage of materials, acts of God, or acts or regulations or priorities of
the federal, state or local government or branches or agencies thereof.
15. INDEMNIFICATION.
A. BY ONE EARTH ENERGY. Except as otherwise provided in this Agreement, One Earth
Energy shall indemnify, defend and hold UBE and its officers, directors, employees and agents
harmless, from any and all losses, liabilities, damages, expenses (including reasonable attorneys’
fees), costs, claims, demands, that UBE or its officers, directors, employees or agents may suffer,
sustain or become subject to, or as a result of (i) any material breach of warranty, covenant or
agreement of One Earth Energy contained herein or (ii) One Earth Energy’s gross negligence or
willful misconduct.
B. BY UBE. Except as otherwise provided in this Agreement, UBE shall indemnify,
defend and hold One Earth Energy and its officer, directors, employees and agents harmless, from
any and all losses, liabilities, damages, expenses (including reasonable attorneys’
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fees), costs, claims, demands, that One Earth Energy or its officers, directors, employees or
agents may suffer, sustain or become subject to, or as a result of (i) any material breach of
warranty, covenant or agreement of UBE contained herein or (ii) UBE’s gross negligence or willful
misconduct.
16. RELATIONSHIP OF PARTIES. This Agreement creates no relationship other than those
of seller and buyer between the parties hereto. Specifically, there is no agency, partnership,
joint venture or other joint or mutual enterprise or undertaking created hereby. Nothing contained
in this Agreement authorizes one party to act for or on behalf of the other and neither party is
entitled to commissions from the other.
17. TRADE RULES. As may be applicable, all purchases and sales of Distiller’s Grains
made hereunder shall be governed by the Feed Trade Rules of the National Grain and Feed Association
unless otherwise specified. Said Trade Rules, shall to the extent applicable, be a part of this
Agreement as if fully set forth herein. Notwithstanding the foregoing, the Arbitration Rules of
the National Grain and Feed Association shall not be applicable to this Agreement.
18. CONFIDENTIALITY. The parties acknowledge that they will have access to certain
confidential information of the other party and that such information constitutes valuable, special
and unique property to such party. The parties agree that they will not at any time, during or for
a period of five (5) years after the termination of this Agreement, in any fashion, form or manner,
either directly or indirectly, divulge, disclose or communicate to any person, firm or corporation
in any manner whatsoever any such information. For purposes of this Agreement, the term
“confidential information” shall mean all information, documentation or financial data used by or
belonging to or relating to either party which is disclosed or made available to the other party,
its agents, employees or advisors, including but not limited to the prices charged for services
hereunder or any other information concerning the other party’s business, manner of operation,
plans, processes or other data of any kind.
19. DISPUTE RESOLUTION. The parties shall attempt to settle amicably any dispute or
difference of any kind whatsoever, arising out of or in connection with the validity or invalidity,
construction, execution, meaning, operation or effect or breach of this Agreement. If the parties
do not promptly do so, either party may, by written notice to the other party, call for private
mediation of the issue before a mediator to be agreed upon by the parties. The parties agree to
conclude such private mediation within thirty (30) days of the filing by a party of a request for
such mediation. In the event of a dispute between the parties that is not resolved by such
mediation, either party may, by written notice to the other party, call for private binding
non-appealable arbitration of the issue before a single arbitrator agreed upon by the parties. In
the event a single arbitrator cannot be agreed upon, each party shall appoint a third party
arbitrator from a list provided by the American Arbitration Association (AAA) (not a principal of a
party) and the two arbitrators thus selected by the parties shall select a third arbitrator. The
arbitrators shall meet as expeditiously as possible to resolve the dispute, and a majority decision
of the arbitrators shall be controlling. While each party is free to select an arbitrator of its
own
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choosing from the list provided by the AAA, either party by written notice to the other may require
that all arbitrators chosen have sufficient expertise in the subject matter of the arbitration that
they would qualify as “expert witnesses” in a judicial proceeding.
The arbitrators so chosen shall conduct the arbitration in accordance with the Rules of the
AAA as applicable in the State of Kansas. Such arbitration shall take place at a mutually agreed
upon location. The arbitrators shall be governed, in their determinations hereunder, by the
intention of the parties as evidenced by the terms of this Agreement. The decision of the
arbitrator shall be rendered in writing and shall be final and binding upon the parties and shall
be non-appealable. Judgment upon the award rendered may be entered by either party and enforced in
any court having competent jurisdiction. The parties shall share the procedural costs of the
mediation and arbitration equally. Each party shall pay its own attorney’s fees and costs incurred
by it relating to the mediation and arbitration. Notwithstanding the foregoing sentences, the
parties hereby authorize the arbitrators to award costs and fees to the prevailing party as the
arbitrators deem appropriate.
Pending resolution of such dispute or difference and without prejudice to their rights, the
parties shall continue to respect all their obligations and to perform all their duties under this
Agreement; provided, however, the parties shall not be obligated to perform their obligations after
this Agreement has been terminated by any party pursuant to paragraph 10, or if such termination is
the dispute being arbitrated.
After signing this Agreement, each party understands that it will not be able to bring a
lawsuit concerning any dispute that may arise that is covered by this arbitration provision (other
than to enforce the arbitration decision).
20. MISCELLANEOUS.
A. This Agreement, together with any attachments or other information which is expressly
incorporated herein and made an integral part of this Agreement, is the complete understanding of
the parties to this Agreement with respect to the subject matter of this Agreement, and no other
representations or agreements shall be binding upon the parties, or shall be effective to
interpret, change or restrict the provisions of this Agreement.
B. No course of prior dealings between the parties and no usage of trade, except where
expressly incorporated by reference, shall be relevant or admissible to supplement, explain, or
vary any of the terms of this Agreement.
C. Acceptance of, or acquiescence in, a course of performance rendered under this or any prior
agreement shall not be relevant or admissible to determine the meaning of this Agreement even
though the accepting or acquiescing party has knowledge of the nature or the performance and an
opportunity to make objection.
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D. UBE has a company policy in effect with regard to all telephonic and electronic
communications, whether said communications are outgoing or incoming. Some UBE business telephones
and other electronic communication systems are customized with centralized recording devices for
purposes of improving customer service, improving techniques, eliminating errors and general
quality control. Communication systems used primarily to negotiate the sale or purchase of
commodities or to discuss commodity futures transactions are recorded and other communications may
be recorded.
E. This Agreement may be executed in multiple counterparts, all of which shall constitute but
one and the same instrument. Facsimile signatures shall be deemed as originals as between the
parties.
F. This Agreement can only be modified by a writing signed by all of the parties or their duly
authorized agents.
G. The paragraph headings herein are for reference purposes only and shall not in any way
affect the meaning or interpretation of this Agreement.
H. This Agreement shall be construed and performed in accordance with the laws of the State of
Kansas.
I. The respective rights, obligations and liabilities of the parties under this Agreement are
not assignable or delegable without the prior written consent of the other party, which shall not
be unreasonably withheld.
J. Time shall be of the essence in the performance of this Agreement.
K. This Agreement shall be binding upon, and shall inure to the benefit of the parties hereto
and their respective successors and assigns.
21. NOTICE AND AUTHORIZATIONS. Upon execution of this agreement, One Earth Energy
will provide UBE a Letter of Authorization in the format of Exhibit C attached, indicating
One Earth Energy’s designated contacts for implementing the normal day-to-day businesses practices
established under this agreement. For all other notices or unless a different method of notice is
provided herein, notice shall be deemed to have been given to the party to whom it is addressed
forty-eight (48) hours after it is deposited in certified U. S. mail, postage prepaid, return
receipt requested, addressed as follows:
12
| ONE EARTH ENERGY: | One Earth Energy, LLC | |||||||
| Attn: | ||||||||
| UBE: | United Bio Energy Ingredients, LLC | |||||||
| Attn: Xxxxx Xxxx | ||||||||
| 0000 Xxxxx Xxxxx Xxxx | ||||||||
| Xxxxxxx, Xxxxxx 00000 | ||||||||
Either party may change the address for notices hereunder by giving notice of such change to
the other party in the manner above provided.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed the day and year
first above written.
| ONE EARTH ENERGY, LLC |
||||
| /s/ Xxxxxx Xxxxx | ||||
| By: | ||||
| Title: | President | |||
| United Bio Energy Ingredients, LLC |
||||
| /s/ Xxxxx Xxxx | ||||
| By: Xxxxx Xxxx | ||||
| Title: | Sr. Vice President | |||
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EXHIBIT A
DISTILLER’S GRAINS SALES CONFIRMATION
Date: <DATE>
| CONTRCT | CON | CONTRACT | CONTRACT | DELIVERY | DUE | CONTRACT | FREIGHT | FOB | SCHED | REMAI | SCHED | REMAIN | ||||||||||||||||||||||||||||||||||||||||
| NUMBER | CM | LOC | NAME DESCR | DATE | DATE | DATE | PRICE | PRICE | PRICE | LOADS | LOADS | QTY | QTY | |||||||||||||||||||||||||||||||||||||||
0001760 |
21 | IA1 | CUSTOMER A | 10/7/2005 | 1/1/2006 | 1/31/2006 | 75 | 0 | 75 | 1 | 1 | 25 | 25 | |||||||||||||||||||||||||||||||||||||||
0001760 |
21 | IA1 | CUSTOMER A | 10/7/2005 | 2/1/2006 | 2/28/2006 | 75 | 0 | 75 | 1 | 1 | 25 | 25 | |||||||||||||||||||||||||||||||||||||||
0001760 |
21 | IA1 | CUSTOMER A | 10/7/2005 | 3/1/2006 | 3/31/2006 | 75 | 0 | 75 | 1 | 1 | 25 | 25 | |||||||||||||||||||||||||||||||||||||||
0001574 |
21 | IA1 | CUSTOMER B | 3/16/2005 | 5/1/2005 | 5/31/2005 | 73 | 0 | 73 | 2 | 2 | 50 | 50 | |||||||||||||||||||||||||||||||||||||||
0001575 |
21 | IA1 | CUSTOMER B | 3/16/2005 | 6/1/2005 | 6/30/2005 | 73 | 0 | 73 | 2 | 2 | 50 | 50 | |||||||||||||||||||||||||||||||||||||||
0001576 |
21 | IA1 | CUSTOMER B | 3/16/2005 | 7/1/2005 | 7/31/2005 | 73 | 0 | 73 | 2 | 2 | 50 | 50 | |||||||||||||||||||||||||||||||||||||||
0001577 |
21 | IA1 | CUSTOMER B | 3/16/2005 | 8/1/2005 | 8/31/2005 | 73 | 0 | 73 | 2 | 2 | 50 | 50 | |||||||||||||||||||||||||||||||||||||||
This Distiller’s Grains Sales Confirmation Must Be Executed and Returned to United Bio Energy Ingredients, LLC
On or Before <3 Business Days After <DATE>>. Failure to Execute and Return this Distiller’s Grains Sales
Confirmation to United Bio Energy Ingredients, LLC by <3 Business Days After <DATE>> is Deemed Acceptance
Of This Distiller’s Grains Sales Confirmation.
Accepted By:
Date:
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EXHIBIT B
| Product | Component | Minimum | Maximum | |||||||||
DDGS |
Protein | 27 | % | — | ||||||||
| Fat | 9 | % | — | |||||||||
| Fiber | — | 15 | % | |||||||||
| Ash | — | 5 | % | |||||||||
| Product | Component | Minimum | Maximum | |||||||||
WDGS |
Protein | 10.05 | % | — | ||||||||
| Fat | 3 | % | — | |||||||||
| Fiber | — | 5 | % | |||||||||
| Ash | — | 2.5 | % | |||||||||
| Product | Component | Minimum | Maximum | |||||||||
Modified WDGS |
Protein | 15 | % | — | ||||||||
| Fat | 4.5 | % | — | |||||||||
| Fiber | — | 9 | % | |||||||||
| Ash | — | 4 | % | |||||||||
Minimum quality standards for all Distiller’s Grains shall also be deemed to be “cool and Sweet”,
and with Aflatoxin levels less than 20 ppb maximum.
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EXHIBIT C
LETTER OF AUTHORIZATION
United Bio Energy Ingredients, LLC (“UBE”)
0000 X. Xxxxx Xxxx
Xxxxxxx, XX 00000
0000 X. Xxxxx Xxxx
Xxxxxxx, XX 00000
To Whom It May Concern:
Each of the following individuals is authorized, without limiting the generality of such
authorization, to give oral and written instructions to UBE or its affiliates on behalf of the
Client for purchases, sales, delivery of property, or all other transactions relating to the
conduct of said account or accounts or commodity contracts to the fullest extent and generally to
do and take all actions necessary or desirable in connection with any such account. The authorized
individuals are (must name at least one person):
We further verify that we shall notify UBE in writing whenever the above named individual(s) are no
longer authorized to give oral or written instructions to UBE on behalf of the Client, and we shall
notify UBE of any newly-authorized staff members whenever applicable.
Dated this day of , 2006
| ONE EARTH ENERGY, LLC |
||||
| By: | ||||
| (Authorized Signatory) | ||||
| Title: | ||||
| (President or Secretary) | ||||
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