November 16, 2001
ICM, Inc.
000 X. Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Re: Temporary to Permanent
Management Placement Agreement
Western Plains Energy, LLC
Campus, KS Project
Gentlemen:
This Letter of Understanding is intended to outline the principle terms
and understanding upon which ICM, Inc. (ICM) would provide Western Plains
Energy, LLC (the "Company") with plant management services through the use of a
plant manager hired and trained by ICM. The intent of this position and
arrangement is to provide the Company quality plant start up and operation.
While the general terms are set out herein, this service is anticipated to begin
during the later stages of plant construction and continue for the agreed upon
term. It is understood that after project funding is completed, a contract for
these services will be entered into between the parties.
SCOPE AND TERMS
HIRING:
For a fee of $250,000 annually, paid by the Company to ICM, ICM will
interview and hire a plant manager for the WPE ethanol plant to be built near
Campus, KS. The date of hiring is anticipated to be 6-9 months prior to plant
startup. The term of the agreement will be for two years with ICM responsible
for paying the salary and benefits of the employee during this time.
TRAINING AND RESPONSIBILITIES:
The manager will be trained by ICM and be reporting to ICM management
though also responsible to act in accordance with the business decisions of The
Board of Managers. Under the guidance of ICM, the manager shall have day-to-day
control of plant operations and be given authority and responsibility, at the
Company's expense, to take actions appropriate to accomplish the purposes of the
Company. Spending authorities will be established in the final temporary to
permanent management contract agreement between ICM and the Company.
ICM SUPPORT:
During the two-year contract agreement, the plant manager will have
access to the technical and scientific knowledge base of ICM management and
employees as support for effective plant operations. This will include, but is
not limited to support for process consulting, engineering services,
Distributive Control System assistance, monitoring and microbiology
assistance. While ICM is responsible for the plant manager's salary and
benefits, expenses such as travel, meals and lodging for ICM personnel in
support of the plant during this period will be paid for by the Company.
TERMINATION:
Termination of the plant manager during this two year period will be
only for cause at the discretion of ICM or a majority vote of The Board of
Managers of the Company with cause being defined as illegal conduct, unethical
conduct, substandard plant operating performance as compared to other plants in
the region not managed by ICM for a period of 6 months or sale, change of
control or dissolution of ICM.
TRANSITION:
Based on the manager's favorable performance, it is anticipated that
The Board of Managers of the Company will transition this employee into a full
time the Company employee as the plant manager at comparable or improved
benefits at the expiration of this two-year agreement. This decision will be
made at least 6 months prior to the expiration of the two-year employment
contract with ICM.
It is anticipated that a non-voting Advisory Seat on The Board of Managers will
be made available to ICM during the time period that the manager is an ICM
employee.
It is understood and agreed that this letter agreement between ICM and the
Company does not constitute the entire agreement, but is a reasonable overview
of the main issues to be addressed in a contract regarding ICM providing a plant
manager after financial close is achieved.
Xxxx Xxxxxx Xxxx Xxxxxxxxx
/s/ Xxxx Xxxxxx /s/ Xxxx Xxxxxxxxx
---------------------------- -------------------------------
Its: Senior Vice President Its: CEO
ICM, Inc. Western Plains Energy, LLC
000 Xxxxx Xxxxx Xxxxxx X.X. Xxx 00
Xxxxxxx, XX 00000 Xxxxx, XX 00000
