Master Coal Purchase and Sale Agreement between Minn-Dak Farmers Cooperative and Rio Tinto Energy America Inc.
Exhibit 10(l)
Master Coal Purchase and Sale Agreement
between
Minn-Dak Farmers Cooperative
and
Rio Tinto Energy America Inc.
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Master Coal Purchase and Sale Agreement Index
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Article 1. |
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General Terms and Definitions |
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Article 2. |
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Term |
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Article 3. |
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Quantity |
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Article 4. |
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Delivery and Transportation |
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Article 5. |
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Title and Risk of Loss; Equipment Damage |
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Article 6. |
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Coal Quality Specifications |
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Article 7. |
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Sampling and Analysis |
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Article 8. |
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Weighing |
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Article 9. |
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Price and Price Adjustments |
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Article 10. |
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Invoices, Payments, Netting, Set off, and Credit Ratings |
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Article 11. |
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Force Majeure |
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Article 12. |
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Records, Audits, Access |
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Article 13. |
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Default, Remedies, and Termination |
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Article 14. |
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Notices |
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Article 15. |
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Cooperation |
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Article 16. |
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Warranty, Limitation on Liability, Duty to Mitigate & Indemnification |
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Article 17. |
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Limitation on Waiver |
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Article 18. |
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Confidentiality |
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Article 19. |
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Entirety, Amendments |
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Article 20. |
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Successors and Assigns |
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Article 21. |
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Governing Laws |
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Article 22. |
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Interpretation |
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Article 23. |
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Resale to Local College |
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Article 24. |
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Survival |
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MASTER COAL PURCHASE AND SALE AGREEMENT
This MASTER COAL PURCHASE AND SALE AGREEMENT (“Agreement”) is entered into and is effective as of the 31st day of July 2006, between Rio Tinto Energy America Inc. (“RTEA”), a Delaware corporation, and Minn-Dak Farmers Cooperative (“Minn-Dak”), a North Dakota cooperative. Both RTEA and Minn-Dak may be individually referred to herein as a “Party” or collectively as “Parties”.
RECITALS
WHEREAS, each Party is engaged in the sale and/or purchase of Powder River Basin (“PRB”) Coal or other Coal. The Parties believe it will be mutually beneficial to set the terms and conditions under which such Coal sales and purchases may be made between them.
IN CONSIDERATION of the mutual covenants and promises set forth hereafter, the Parties to this Agreement, intending to legally bind themselves, agree now as follows:
ARTICLE 1. GENERAL TERMS AND DEFINITIONS
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1.01 |
The terms of this Agreement shall govern all purchases and sales of Coal between the Parties (hereinafter “Transactions”) or options thereon during the term of this Agreement unless the Parties expressly indicate otherwise. All amendments, modifications, revisions and changes to this Agreement or any related Transaction or option must be in writing and signed by both Parties. If the Parties enter into an option concerning the purchase and/or sale of Coal, the terms and conditions of this Agreement and the Confirmation Letter shall govern the Transaction once the option has been exercised. |
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1.02 |
For individual Transactions, the Parties shall enter into a written Confirmation Letter (hereinafter “Confirmation”) that sets forth and defines the following: the Buyer, the Seller, the price, price adjustments, quantity, term, quality specifications, mine(s), and any other Transaction-specific provisions mutually agreed upon by the Parties. All Confirmations shall be in writing, signed by both Parties. The Parties intend the provisions of each individual Confirmation and the provisions of this Agreement be construed as one single integrated agreement and that without a written Confirmation the Parties would not otherwise enter into a Transaction. Any inconsistency or conflict between provisions of the individual Confirmation and provisions of this Agreement shall be resolved in favor of any provisions of the Confirmation. |
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1.03 |
Each of the following terms when used in this Agreement will have the meaning given to it in this section: |
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a) |
“Actual Btu” means the monthly ton-weighted average as-received calorific value (stated in Btu/lb.). |
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b) |
“Buyer” means the Party to a Transaction who is obligated to purchase and receive Coal, or causes Coal to be received. |
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c) |
“Claim” means all claims or actions threatened or filed that directly or indirectly relate to the subject matter of this Agreement, including but not limited to indemnity, the resulting losses, damages, expenses, reasonable attorneys’ fees and costs. |
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d) |
“Coal” means any and all Coal to be sold by Seller and purchased by Buyer pursuant to the terms and conditions of this Agreement. |
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e) |
“Electronic” means faxes, telegraphs, emails, and all other forms of electronic data transfer. |
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f) |
“Standard Btu” means the standard calorific value as set forth in a Confirmation (stated in Btu/lb.) and is the basis for a price adjustment as described in Section 9.03. |
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g) |
“Seller” means the Party to a Transaction who is obligated to sell and deliver Coal or causes Coal to be delivered. |
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h) |
“Ton” means 2,000 pounds avoirdupois. |
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i) |
“Loading Provisions” means the terms and conditions of Buyer’s contracts or excerpts thereof that Seller has reviewed and approved. The Loading Provisions are further described in Section 4.04 and attached as Exhibit A. |
ARTICLE 2. TERM
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2.01 |
This Agreement shall begin on the date first set forth above and shall continue in effect until terminated by either Party upon sixty (60) days written notice to the other Party, which right of termination shall be each Party’s absolute right to exercise. Termination of this Agreement under this Article shall not affect either Party’s rights and obligations with respect to any Transactions that have been agreed to in writing in a Confirmation prior to termination. |
ARTICLE 3. QUANTITY
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3.01 |
Buyershall be obligated to purchase and pay for, and Seller shall be obligated to sell and tender for delivery, the amount of Coal agreed to in a Confirmation, except as may be limited by Article 11 of this Agreement. |
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3.02 |
Unless otherwise limited in the Confirmation, Buyer has the right to ship or use the Coal delivered under this Agreement at any of Buyer’s locations or for any such purpose Buyer designates. |
ARTICLE 4. DELIVERY AND TRANSPORTATION
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4.01 |
For each Transaction, Seller agrees to tender to Buyer and Buyer agrees to accept from Seller the quantity of Coal as provided in the relevant Confirmation. Seller shall tender the Coal to Buyer in accordance with reasonable monthly delivery schedules to be submitted by |
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Buyer in accordance with the Agreement and the Confirmation. Schedules shall be based on a ratable monthly basis unless otherwise agreed to by both Parties. In addition, Buyer shall provide Seller with monthly schedules at least sixty (60) days prior to the beginning of each applicable month. If the Seller objects to a schedule submitted by Buyer, Seller shall notify Buyer of its objections within fifteen (15) days of Seller’s receipt of such schedule and the Parties shall work together in good faith to agree on a reasonable and mutually acceptable schedule. The mine(s) used to source the Coal supplied under this Agreement shall be any mine set forth in the Confirmation. |
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4.02 |
Buyer shall supply the appropriate unit train railcars. Said railcars shall be of a size compatible with the loading requirements set forth in this Agreement. Unit train sizes will normally vary from 105 to 135 railcars per train; however, depending on railcar availability, shorter or longer trains may occasionally be operated by mutual agreement. |
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4.03 |
Unless excused by Article 11 of this Agreement, if Buyer fails over a quarterly basis to schedule the appropriate unit trains for delivery of an amount of Coal scheduled under a Transaction, Seller shall have the right at Seller’s sole option to reduce the annual quantities of that Transaction by the deficit from the scheduled amount. This right shall be in addition to any other rights available to Seller hereunder. |
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4.04 |
Seller shall cause Coal to be loaded and delivered at the loading facilities into railcars supplied by Buyer. Seller agrees to comply with the weighing and railcar Loading Provisions. Said Loading Provisions are subject to Seller’s ability to load the required net tonnages in Buyer’s railcar without significant risk of spillage or exceeding railcar limits and shall be in general compliance with industry standards for the applicable coal region. Seller shall have at least 48 hours notice of any changes to the Loading Provisions. If the changes to the Loading Provisions are inconsistent with Seller’s commitments as otherwise set forth in this Agreement and Seller’s then current operating practice, Seller shall not be liable for |
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noncompliance with such changes unless expressly accepted by Seller. Should the obligations as set forth in this Article 4 not be met, and as a result, Buyer incurs costs under its transportation agreement with the rail carrier as a direct result of Seller’s not meeting its obligation hereunder and such failure is not the fault of either Buyer or the railroad, then Seller shall reimburse Buyer for any such costs as set forth in Exhibit A. |
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4.05 |
The scheduled Coal shall be F.O.B. loaded in Buyer-provided railcars at the delivery point located at each individual mine (“Delivery Point”). Buyer’s railcars and unit train shall be compatible with Seller’s trackage, storage and loading facilities, and shall be ready to load upon arrival at the individual mine. Seller shall load each railcar at Seller’s expense and shall complete the loading of all railcars in each unit train within four hours after the first empty railcar is actually placed by the railroad under the Seller’s loading chute. Unless excused by Article 11 or due to actions of Buyer or Buyers rail carrier, Seller shall be responsible for demurrage or other charges invoiced to Buyer by Buyer’s rail carrier resulting directly from Seller’s failure to load Buyer’s trains as provided above. |
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4.06 |
Seller is required to load each railcar to the gross weight(s) designated in the Confirmation; however, under no circumstances will the gross weight exceed the maximum limit established by the rail carrier(s) for the railcar type and for the designated train routes. Should Seller load any railcar on Buyer’s behalf outside of these specified limits, the Seller assumes any and all reasonable costs which may be charged by the rail carrier(s) and paid by Buyer as a direct result of such underloading or overloading of these railcars. |
ARTICLE 5. TITLE AND RISK OF LOSS; EQUIPMENT DAMAGE
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5.01 |
Title to the Coal and all risk of loss shall pass to Buyer upon completion of loading all railcars in each unit train at the Delivery Point. |
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5.02 |
Seller shall be responsible for, and shall indemnify Buyer for, any and all direct reasonable costs resulting from damage to: (i) Buyer’s equipment if such equipment is damaged while on Seller’s property except to the extent such damage is caused by the negligence or recklessness of Buyer or its contracted rail carrier; and (ii) Buyer’s equipment, including mobile railcars and stationary equipment at Buyer’s electric generating station, if said equipment is damaged as a result of non-Coal material having been interspersed with the tendered Coal prior to leaving Seller’s mine property. |
ARTICLE 6. COAL QUALITY SPECIFICATIONS
If the Parties set forth coal quality specifications in a Confirmation, the following Sections 6.01 – 6.03 shall apply with respect to those specifications.
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6.01 |
At the Delivery Point, all tendered Coal shall be raw, substantially free of magnetic material and other foreign material impurities, and crushed to a maximum size as set forth in the Confirmation as determined in accordance with applicable American Society of Testing and Materials (ASTM) standards. |
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6.02 |
If there are three (3) Non-Conforming Shipments as defined in Section 6.04, whether rejected or not, under a Transaction in any three (3) month period or, if two (2) out of four (4) consecutive shipments under a Transaction are Non-Conforming Shipments, Buyer may upon notice confirmed in writing and sent to Seller, suspend future shipments except those shipments already loaded into railcars. Seller shall, within sixty (60) days, provide Buyer with reasonable assurances that subsequent deliveries of Coal shall meet or exceed the specifications set forth in the Confirmation. If Seller fails to provide such assurances within that sixty (60) day period, Buyer shall have the right to terminate the Transaction without further obligation hereunder on the part of either party. Termination shall be the sole remedy of Buyer under this Section. Buyer’s waiver of this right for any one train shall not constitute a |
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waiver for subsequent trains. If Seller provides such assurances to Buyer’s reasonable satisfaction, deliveries hereunder shall resume and any tonnage deficiencies resulting from suspension may be made up at Buyer’s sole option subject to a mutually agreeable schedule. Buyer shall not unreasonably withhold its acceptance of Seller’s assurances, or delay the resumption of shipment. |
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6.03 |
The Parties recognize during the performance of a Transaction, legislative, regulatory bodies or the courts may adopt environmental laws, rules, and regulations that will make it impossible or commercially impracticable for Buyer to utilize or to remarket Coal purchased under this Agreement. If, as a result of the adoption of such laws, rules, and regulations or changes in the interpretation or enforcement thereof, Buyer, in good faith, decides it will be impossible or commercially impracticable for Buyer to utilize or to remarket such Coal, Buyer shall promptly notify Seller in writing. After receiving such notification, Buyer and Seller shall promptly consider whether corrective actions can be taken in the mining and preparation of the Coal, in the operation of Buyer’s generating station, or in Seller’s substituting different source Coal. If in the Parties’ reasonable judgment such actions will, make it impossible and commercially impracticable for Buyer to utilize or to remarket tendered Coal without violating any applicable law, regulation, policy, or order, Buyer shall have the right, upon sixty (60) days notice to Seller, to terminate the Transaction without further obligation on the part of either party. Termination shall be the sole remedy of Buyer and Seller under this section. |
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If Rejection Limits are specified in the Confirmation, this Section 6.04 shall apply. |
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6.04 |
If any Shipment of Coal triggers any of the Rejection Limits specified in the Confirmation for a Transaction (a “Non-Conforming Shipment”), Buyer shall have the option, within twenty-four (24) hours of Buyer’s receipt of the quality analysis of the Coal, of either (i) rejecting such Non-Conforming Shipment prior to unloading the Coal, or, (ii) accepting the Non-Conforming Shipment and in addition to any quality adjustments outlined in the Confirmation, reducing the |
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price of Coal for such trainload by $0.50 per ton. If Buyer fails to timely exercise its rejection rights under this Section as to a Shipment, Buyer shall be deemed to have waived such rights to reject with respect to that Shipment only. Buyer’s failure to timely exercise such notice does not constitute a waiver of its right to any penalty adjustment provided for herein or in the relevant Confirmation. If Buyer timely rejects the Non-Conforming Shipment, Seller shall be responsible for promptly transporting the rejected Coal to an alternative destination determined by Seller and, if applicable, promptly unloading such Coal. Seller shall reimburse Buyer for all reasonable costs and expenses associated with the transportation, storage, handling and removal of the Non-Conforming Shipment. Buyer shall cooperate with Seller in minimizing Seller’s cost of redirecting the rejected Coal. Seller shall replace the rejected coal within a reasonable period of time. |
ARTICLE 7. SAMPLING AND ANALYSIS
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7.01 |
Seller shall cause, at its expense, the Coal in each unit train to be sampled and analyzed at the individual mine in accordance with applicable ASTM standards. Buyer shall have the right, at its own risk and expense, to have a representative present at any and all times to observe sampling and analysis procedures. All samples shall be divided into three (3) parts and put in suitable airtight containers. One part shall be furnished to Buyer or its designee for its analysis, one part shall be retained for analysis by Seller or its designee (which analysis shall be the basis for payment), and the third part shall be retained by Seller or its designee in one of the aforesaid containers properly sealed and labeled for a period thirty (30) days after the date of sample collection. Buyer’s samples are to be clearly labeled as to mine, date of sampling, date of preparation, and other identification as to shipment (such as train identification number) and are to be sent within forty-eight (48) hours of train loading to the address listed below unless a different address is provided by Buyer in the Confirmation or otherwise in writing. Seller shall cause the following data, subject to future adjustment, to be provided to Buyer by a mutually agreed upon method of electronic data transmission within |
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forty-eight (48) hours of train loading: tonnage (gross, net, and tare average for each railcar and the unit train in total), and the average calorific value, % moisture, % ash, % sulfur, and % Na2O in ash (if set forth in the Confirmation), (the “Short Proximate Analysis”). Any additional analysis requested by Buyer that exceeds the information provided in the Short Proximate Analysis shall be at Buyer’s expense. |
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Mailing address for sample splits: |
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Minn-Dak Farmers Cooperative |
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Attn: Xxx Xxxxxx |
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0000 Xxx Xxxxx Xxxx |
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Xxxxxxxx, XX 00000-0000 |
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7.02 |
In the event a dispute arises between Buyer and Seller within thirty (30) days of Seller’s analysis due to a difference between Buyer and Seller’s short proximate analyses of a sample that exceeds the ASTM interlab repeatability limits, an independent testing laboratory, mutually agreeable to Buyer and Seller, will be retained to analyze the third part of such sample. The Party whose calorific value analysis is closest to the independent analysis shall prevail and such Party’s calorific value analysis shall govern for the trainload in question. In such case, the cost of the analysis made by such independent testing laboratory will be borne by the Party whose calorific value analysis is furthest from the independent analysis and therefore, not used. In the event both Parties’ calorific value analyses differ from the independent testing laboratory’s result by the same amount, the independent testing laboratory’s result shall govern for the trainload in question and the Parties shall share equally the cost of the independent testing. |
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ARTICLE 8. WEIGHING |
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8.01 |
Certified commercial scales at Seller’s train loading facility at each individual mine will determine weights. Scales shall be calibrated and tested as customary in industry practice with copies of calibration and testing reports provided to Buyer upon request. If Seller’s scales are not available to determine the valid net weight of all of the railcars in a unit train |
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but valid weights are obtained for thirty (30) or more railcars in such train, the arithmetic average of all of the valid net weights of the thirty or more railcars in such train shall be used as the net weight for each railcar in such train for which a valid net weight was not determined by Seller’s scales. If Seller’s scales are inoperative or fail to determine the valid net weight of at least thirty (30) railcars in a unit train, the weighted arithmetic average of the net railcar weights of the previous ten (10) unit trainloads of Coal shipped to Buyer shall be used as the net weight for each of the unweighed railcars in such train. The calculation of the weighted arithmetic average net weight for the previous ten (10) unit trainloads shall exclude all bad-order railcars, which were not loaded, and any trainload of Coal for which the net weights were estimated on thirty (30) or more railcars. The Buyer shall be notified electronically immediately after the above instance occurs. |
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ARTICLE 9. PRICE AND PRICE ADJUSTMENTS |
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9.01 |
For all Coal delivered under this Agreement, Buyer shall pay Seller the base price as set forth in the Confirmation. |
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9.02 |
Seller shall be solely responsible for all assessments, fees, costs, expenses, and taxes relating to the mining, production, sale, use, loading and tender of Coal to Buyer or in any way accruing or levied prior to transfer of title to the Coal to Buyer and including, without limitation, severance taxes, royalties, ad valorem, black lung fees, reclamation fees and other costs, charges and liabilities. The base price includes reimbursement to Seller of all environmental, land restoration and regulatory costs, including without limitation any reclamation costs required under applicable federal, state or local law as of the date of the Transaction. Buyer shall be responsible for any sales and/or use tax unless Buyer provides Seller an appropriate exemption certificate or similar document. The base price shall be subject to adjustments for changes in existing laws and regulations (including changes in levies and rates), or new laws or regulations, or changes in interpretations thereof enacted |
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and in force during the term of sale set forth in the Confirmation that change Seller’s costs of producing Coal for delivery pursuant to any Confirmation. Notwithstanding the above, no price adjustment will occur under this Section until the cumulative effect of all such changes equals or exceeds $0.05 per ton for any calendar year under a Transaction. Seller shall use commercially reasonable best efforts to inform Buyer of any such change as soon as Seller becomes aware of such change and its effect on the base price of Coal hereunder. |
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9.03 |
The base price may also include an adjustment based upon the calorific value, sulfur content or other qualities of the Coal as the Parties may mutually agree upon and as set forth in the Confirmation. |
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ARTICLE 10. INVOICES, PAYMENTS, NETTING, SET OFF, AND CREDIT RATINGS |
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10.01 |
Based on Seller’s weights, Seller will invoice Buyer twice a month for all Coal delivered. Invoices for quality adjustment, as provided in a Transaction, shall be issued monthly, based on Seller’s analyses. Seller shall clearly indicate Buyer’s applicable purchase order number on all invoices. Each invoice shall state for each trainload of Coal: the quantity of Coal delivered, the Actual Btu and SO2, % Na2O in ash (if set forth in the Confirmation) and the invoice price and any other required quality adjustment. Invoices shall be mailed or electronically transmitted, as applicable, to: |
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Invoices to Minn-Dak: |
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Minn-Dak Farmers Cooperative |
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Invoices to RTEA: |
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Rio Tinto Energy America Inc. |
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Checks to RTEA: |
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Rio Tinto Energy America Inc. |
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ACH/Wires to RTEA: |
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Rio Tinto Energy America Inc. |
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Payment Detail: |
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To ensure proper allocation of payments to appropriate invoice, e-mail invoice numbers and amounts to: Xxxxxx.Xxxxx@Xxxxxxxx.xxx or information may be faxed to (000) 000-0000. |
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10.02 |
For all invoices, payment will be made within 5 business days of receipt of that invoice. Amounts shall be paid via check or electronic means (i.e., ACH or Federal Reserve wire transfer of funds). The wire transfer of funds shall be sent to Seller’s bank as indicated on the invoice. |
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10.03 |
In the event Buyer in good faith disputes part or all of an invoice, notice of the disputed portion, with reasons for dispute, must be given prior to the due date of the invoice and the undisputed portion shall be paid by the due date. If the disputed portion is determined to have been properly due and payable, interest on that portion in dispute and which has not been paid shall accrue from the date that portion was due and payable. If a disputed portion is paid and is later determined not to have been properly due and payable, interest will similarly be refunded from the date payment had been received. Interest shall be paid at one (1) percentage point over the then current U.S. prime rate as listed in the Money Rates section of The Wall Street Journal. All invoices will be final and not subject to further adjustments or correction unless objection to the accuracy thereof is made prior to the lapse of one (1) year after the termination of the applicable Transaction. |
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10.04 |
If each Party or Party’s affiliate is required to pay an amount to the other Party in the same invoice period, then such amounts with respect to each Party may be aggregated and the Parties may discharge their obligations to pay through netting; in which case, the Party owing the greater aggregate amount shall pay to the other Party the difference between the amounts owed. |
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10.05 |
Each Party reserves to itself all rights, setoffs, counterclaims, and other remedies and defenses to the extent not expressly denied or waived herein which such Party has or may be entitled to arising from or out of this Agreement. All outstanding Transactions and the obligations to make payment in connection under this Agreement may be offset against each other, set off, or recouped therefrom. |
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10.06 |
If a Party fails to pay amounts under this Agreement within 5 business days after receipt of invoice, unless such amount is the subject of a dispute as provided above, or is excused by Article 11, in addition to the rights and remedies otherwise provided in this Agreement, the aggrieved Party shall have the right to suspend performance under any or all Transactions under this Agreement. If such failure to pay continues for an additional 5 business days, the aggrieved Party shall have the right to terminate this Agreement and all Transactions and shall be entitled to all other rights under this Agreement. |
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10.07 |
Should the creditworthiness or either Party’s ability to perform become unsatisfactory to the other Party, or if situations develop where either Party could reasonably conclude that a credit downgrade or protection under bankruptcy code is imminent, then the failing Party will provide satisfactory security or assurances. |
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10.08 |
Should Buyer’s creditworthiness, financial responsibility, or performance viability become unsatisfactory to the Seller at any time in Seller’s reasonably exercised discretion with regard to any Transaction pursuant to this Agreement, the Seller may request in writing that |
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the Buyer provide, reasonable assurance acceptable to Seller in the form of either (a) the posting of a Letter of Credit, (b) Cash, (c) a cash prepayment, (d) the posting of other acceptable collateral or security by the Buyer, (e) a guarantee agreement executed by a creditworthy entity; (f) compressed payment terms or (g) some other mutually agreeable method of satisfying the Seller (collectively, “Performance Assurance”). If the Seller’s request for Performance Assurance is made on a Business Day, Buyer shall have two (2) Business Days to provide such Performance Assurance. |
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ARTICLE 11. FORCE MAJEURE |
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11.01 |
The term “Force Majeure” as used herein shall mean an act or event that is not reasonably within the control and is without the fault of the party claiming Force Majeure including without limitation, acts of God; acts of the public enemy; insurrections; terrorism; riots; labor disputes; boycotts; fires; explosions; floods; breakdowns of or damage to major components or equipment of Buyer’s generating station, Seller’s mine, or transmission systems, or railcar transportation system; embargoes; acts of judicial or military authorities; acts of governmental authorities; inability to obtain necessary permits, licenses, and governmental approvals after applying for same with reasonable diligence; or other causes which prevent the producing, processing, and/or loading of Coal by Seller, or the receiving, accepting, unloading and/or utilizing of Coal by Buyer. Force Majeure includes the failure of a Party’s contractor(s) to furnish labor, services, Coal, materials or equipment in accordance with its contractual obligations (but solely to the extent such failure is itself due to Force Majeure). |
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11.02 |
If, because of Force Majeure, either Party fails to perform any of its obligations under this Agreement (other than the obligation of a Party to pay money), and if such Party shall promptly give to the other Party written notice of such Force Majeure, then the obligation of the Party giving such notice shall be suspended to the extent made necessary by such Force Majeure and during its continuance; provided, the Party giving such notice shall use good |
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faith efforts to eliminate such Force Majeure, insofar as reasonably possible, with a minimum of delay. Should the situation of Force Majeure exceed sixty (60) consecutive days, the Party not affected by the Force Majeure event may, at its option, terminate the Transaction in whole or in part and neither Party shall have any further obligation to the other Party; however, each Party shall be obligated to make any payments which had become due and payable prior to such termination. Any deficiencies in deliveries of Coal caused by an event of Force Majeure shall not be made up, except by mutual consent. The affected Party shall provide suitable proof to the other Party to substantiate any claim made under this Article 11. |
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11.03 |
Both Parties agree significant capital expenditures and settlement of strikes and lockouts shall be entirely within the discretion of the Party having the difficulty. The above requirement that any Force Majeure shall be remedied with all reasonable dispatch shall not require significant capital expenditure or settlement of strikes and lockouts by acceding to the demands of the opposing Party when such course is inadvisable in the discretion of the Party having difficulty. |
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11.04 |
The loss of Buyer’s markets or Buyer’s inability to economically use or resell Coal purchased hereunder, the loss of Seller’s supply or Seller’s ability to sell Coal to a market at a more advantageous price, the change in the market price of Coal or price of power, or regulatory or contractual disallowance of the pass-through of the costs of Coal or other related costs shall not constitute events of Force Majeure. |
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ARTICLE 12. RECORDS, AUDITS, ACCESS |
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12.01 |
Seller shall maintain books and records relating to the supply of Coal under this Agreement and the applicable Transaction for a period of not less than two (2) years after the end of each calendar year for all Coal tendered during such calendar year. |
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12.02 |
Upon reasonable notice and during normal business hours, Buyer and/or Buyer’s independent auditors shall have the right to inspect Seller’s books and records relating to all provisions of this Agreement which include Coal quality, quantity shipped, and price adjustments or as may be necessary to satisfy inquiries from governmental or regulatory agencies, but only to the extent necessary to verify the accuracy of any statement, charges or computations made pursuant to this Agreement and/or a Transaction. Seller shall make a reasonable effort to facilitate Buyer’s inspection of such records in Seller’s possession. Buyer and its auditors, to the extent permitted by law or regulation, shall treat all such information as confidential. |
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ARTICLE 13. DEFAULT, REMEDIES, AND TERMINATION |
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13.01 |
The remedies set forth in this Section 13.01 shall cover the non-defaulting Party’s remedies for the defaulting Party’s failure to perform prior to any termination for default that may occur. |
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a) |
As an alternative to the damages provision below, if the Parties mutually agree in writing, the non-performing Party may schedule deliveries or receipts, as the case may be, pursuant to such terms as the Parties agree in order to discharge some or all of the obligation to pay damages. In the absence of such agreement, the damages provision of this Article shall apply. |
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b) |
Unless excused by Force Majeure, if Seller fails to deliver the quantity of Coal in accordance with the applicable Confirmation and this Agreement, Seller shall pay to Buyer an amount for each ton of Coal of such deficiency equal to (i) the lowest reasonable market price on an equivalent per mmBtu SO2 adjusted basis at which Buyer is able, or (ii) at the time of Seller’s breach, would be able to purchase or otherwise receive comparable supplies of Coal of comparable quality minus the base price agreed to for the specific Transaction; except that if such difference is negative, |
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then neither Party shall have any obligation to make any deficiency payment to the other. |
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c) |
Unless excused by Force Majeure, if Buyer fails to accept delivery of the quantity of Coal in accordance with the applicable Confirmation and this Agreement, Buyer shall pay to Seller an amount for each ton of Coal of such deficiency equal to (i) the base price agreed to for the specific Transaction minus the highest reasonable market price on an equivalent per mmBtu SO2 adjusted basis at which Seller is able, or (ii) would be able, to sell or otherwise dispose of the Coal at the time of Buyer’s breach; except that if such difference is negative, then neither Party shall have any obligation to make any deficiency payment to the other. |
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d) |
Buyer and Seller shall be subject to commercially reasonable good faith obligation to mitigate any damages hereunder. |
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13.02 |
The occurrence of any of the following shall constitute an “Event of Default”: |
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a) |
Failure by either Party to pay any amounts due. |
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b) |
Either Party materially breaches any contractual obligation under this Agreement. |
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c) |
Either Party (i) makes any general assignment or any general arrangement for the benefit of creditors, (ii) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy or similar law for the protection of creditors or has such a petition involuntarily filed against it and such petition is not withdrawn or dismissed within thirty (30) days after such filing, (iii) otherwise becomes bankrupt or insolvent (however evidenced), or (iv) is unable to pay its debts as they fall due. |
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13.03 |
In addition to the non-defaulting Party’s remedies under this Article, in the Event of Default with respect to a specific Transaction, the non-defaulting Party shall have the same rights with respect to such specific Transaction as it has under this Agreement in addition to the right to exercise all other rights and remedies available under applicable law. |
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ARTICLE 14. NOTICES |
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14.01 |
Except as expressly provided otherwise, any notice, election or other correspondence required or permitted hereunder shall become effective upon receipt and, except invoices and payments, shall be deemed to have been properly given or delivered when made in writing and delivered personally to the Party to whom directed, or when sent by United States certified mail with all necessary postage prepaid and a return receipt requested, or by a nationally recognized overnight delivery service with charges fully prepaid and addressed to the Party at the below-specified address: |
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Notices to RTEA: |
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Rio Tinto Energy America Inc. |
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With a copy to: |
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Rio Tinto Energy America Inc. |
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Scheduling to RTEA: |
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Rio Tinto Energy America Inc. |
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Notices to Minn-Dak: |
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Minn-Dak Farmers cooperative |
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The addresses may be changed upon written notice in the manner provided above, and no amendment hereof shall be required for a change of address under this Article 14. |
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ARTICLE 15. COOPERATION |
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15.01 |
Each Party agrees to take all further action that may be reasonably necessary to perform and to effectuate the purposes and intent of the Agreement, the Confirmation, and any particular Transaction. |
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ARTICLE 16. WARRANTY, LIMITATION ON LIABILITY, DUTY TO MITIGATE & INDEMNIFICATION |
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16.01 |
In no event shall either Party be liable to the other Party for incidental, consequential or punitive damages however and wherever arising out of, or in connection with, this Agreement or any Transaction. |
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16.02 |
EXCEPT AS EXPRESSLY WARRANTED HEREIN, IT IS EXPRESSLY AGREED THAT SELLER MAKES NO WARRANTY EXPRESSED OR IMPLIED AS TO THE QUALITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE COAL TO BE DELIVERED UNDER THIS AGREEMENT OR AS TO THE RESULTS TO BE OBTAINED FROM THE USE OF SUCH COAL. SELLER SHALL NOT BE LIABLE FOR ANY INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES, INCLUDING WITHOUT LIMITATION LOSS OF PROFITS OR OVERHEAD, BY VIRTUE OF ITS BREACH OF ANY |
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OF ITS OBLIGATIONS UNDER THE AGREEMENT. NOTHING IN THIS ARTICLE SHALL BE CONSTRUED AS LIMITING BUYER’S RIGHT, SUBJECT TO THE TERMS OF THIS AGREEMENT, TO SEEK DIRECT DAMAGES FOR SELLER’S BREACH OF ANY OF ITS OBLIGATIONS HEREUNDER. |
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16.03 |
Each Party agrees it has a duty to mitigate damages and covenants. Each Party will use commercially reasonable efforts to minimize any damages it may incur as a result of the other Party’s performance or non-performance of the Agreement (except that neither Party shall be required to enter into a replacement transaction as provided under this Agreement). |
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16.04 |
Each Party shall indemnify, defend, and hold the other Party harmless from and against any and all Claims arising out of or resulting from the willful acts or negligence of such Party, its agents, and employees. |
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ARTICLE 17. LIMITATION ON WAIVER |
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17.01 |
No waiver by either Party of any one or more defaults of the other Party in the performance of this Agreement or any Transaction shall operate or be construed as a waiver of any future default, or defaults, whether of a like or different character. |
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ARTICLE 18. CONFIDENTIALITY |
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18.01 |
This Agreement and any Confirmation are deemed confidential. The Parties shall protect the confidentiality of the terms of this Agreement and neither this Agreement or any of its terms shall be disclosed to any other person unless such disclosure is: (i) agreed to in writing by the Parties prior to release, (ii) required by law, (iii) required by jurisdictional regulation pursuant to the request of any regulatory authorities (including, without limitation, state utility commissions or boards, the Federal Energy Regulatory Commission, the U.S. Securities and |
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Exchange Commission and tax authorities); to attorneys, auditors, consultants or other outside experts of the parties if said individuals are advised of the confidential nature of the information and said individuals agree to maintain the confidentiality of the information; or to generating unit co-owner(s). Where the law requires such disclosure, notice shall be given to the other Party, and to the extent possible, such notice shall be given in advance of disclosure. |
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ARTICLE 19. ENTIRETY, AMENDMENTS |
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19.01 |
This Agreement constitutes the entire agreement between the Parties. This Agreement may not be amended except in a written instrument making reference hereto signed by the Parties. |
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ARTICLE 20. SUCCESSORS AND ASSIGNS |
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20.01 |
This Agreement shall inure to the benefit of and be binding upon the Parties hereto and their respective successors and assigns; provided, however, this Agreement may not be assigned by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed. |
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ARTICLE 21. GOVERNING LAWS |
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21.01 |
This Agreement shall be governed by and construed in accordance with the laws in the State of Wyoming. |
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ARTICLE 22. INTERPRETATION |
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22.01 |
The Parties acknowledge that each Party and its counsel have reviewed this Agreement and that the rule of construction to the effect that any ambiguities are to be resolved against the drafting Party shall not be employed in the interpretation of this Agreement. |
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ARTICLE 23. RESALE TO LOCAL COLLEGE |
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23.01 |
Seller agrees to allow Buyer to re-sell the Coal in Buyer’s stockpile to North Dakota State College of Science. |
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ARTICLE 24. SURVIVAL |
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24.01 |
The provisions of Articles 12 through 22 and Article 24 shall survive the termination of this Agreement. |
IN WITNESS WHEREOF, the parties have executed this Agreement by their respective, duly authorized representatives effective as of the date first written above.
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Rio Tinto Energy America Inc. |
Minn-Dak Farmers Cooperative |
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By: |
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By: |
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Xxxxxxx X. Xxxxx |
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Vice President, Marketing, |
Title: |
Purchasing Manager |
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Government Affairs & Communications |
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Date: |
25 August 2006 |
Date: |
6th August 2006 |
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RAILROAD EQUIPMENT LEASE
THIS RAILROAD EQUIPMENT LEASE (the “Lease”) is entered into as of this the 1st day of August 2006, (the “Effective Date”) by and between Northern Coal Transportation Company, an Oregon corporation (hereinafter referred to as “Lessor”), and Minn-Dak Farmers Cooperative (hereinafter referred to as “Lessee”).
WHEREAS, Lessee desires to lease from Lessor and Lessor desires to lease to Lessee certain coal hauling railcars (the “Units”) that make up a Unit Train so that Lessee may make deliveries of coal to its Wahpeton Sugar Beet Factory.
NOW, THEREFORE, in consideration of the mutual premises, covenants and agreements set forth herein, the parties hereby agree as follows:
1. LEASE OF UNITS. Lessor hereby leases to Lessee and Lessee hereby leases from Lessor the Units commencing on the Effective Date written above and ending for all Units on the last day of July 2010 or on the date Lessee has unloaded the last Unit Train, whichever occurs first (the “Expiration Date”).
2. BASE RENTAL. Lessee agrees to pay to Lessor the amount of the trip lease price of $X.XX per/ton for all tons hauled in the Units. Lessor shall invoice Lessee semimonthly for the base rental. Payment shall be due on each invoice within ten (10) days after the date of the invoice by check or wire transfer to Northern’s account, as follows:
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Wire Transfer: |
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BANK: |
First Security Bank of Utah |
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ABA No: |
000000000 |
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Account No: |
060-00069-02 |
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Account Name: |
Northern Coal Transportation |
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Check: |
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Account Name: |
Northern Coal Transportation |
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Account No.: |
060-00069-02 |
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Address: |
X.X. Xxx 00000, Xxxx Xxxx Xxxx, Xxxx 00000-0000 |
3. DELIVERY OF UNITS. Lessor will cause each Unit to be tendered to the Lessee at the Spring Creek Mine in Xxxxxx Montana. Each Unit shall: (i) be empty, substantially free from debris, lading, residue of lading, and suitable for loading; (ii) meet the standards of the Interchange Rules of the Association of American Railroads, the Surface Transportation Board, the Department of Transportation, and any other legislative, administrative, judicial, regulatory or governmental body having jurisdiction in the matter.
4. MAINTENANCE AND REPAIRS.
(a) Lessor shall have the right, but not the obligation, to inspect the Unit(s) and conduct preventative maintenance as Lessor deems necessary. If, as a result of such inspections, repairs that are Lessee’s responsibility under Sections 4(c) are found to be necessary, then Lessee will provide freight and switching services to and from any shop of Lessor’s choosing at no cost to Lessor. Lessor will undertake such maintenance when possible and in a manner that minimizes the interruptions of service to Lessee.
(b) Lessee shall not make any alteration, improvement or addition to any Unit without Lessor’s prior written consent.
(c) Lessee shall be responsible for all repairs necessary as a result of damage to a Unit, including but not limited to, damage caused by cornering, sideswiping, derailment, improper or abusive loading or unloading methods, unfair usage or similar occurrences while under this Lease, whether such damage to a Unit is direct, indirect, incidental or consequential, but excluding the maintenance and repairs made necessary by ordinary wear and tear which shall be the Lessor’s responsibility.
(d) Notwithstanding anything herein contained, Lessor may notify Lessee that it is withdrawing from this Lease any Unit which, in the opinion of Lessor, has been destroyed, damaged or needs repairs in excess of its economic value, whereupon this Lease will terminate as to such withdrawn Unit; provided, however, Lessor may, with Lessee’s consent, substitute a Unit of like specifications, for such withdrawn Unit, in which case all of the terms and conditions of this Lease shall apply to the substituted Unit.
5. DISCLAIMER OF WARRANTIES. LESSOR, NOT BEING THE MANUFACTURER OF THE UNITS, NOR THE MANUFACTURER’S AGENT, HEREBY EXPRESSLY DISCLAIMS AND MAKES TO LESSEE NO WARRANTY OR REPRESENTATION, EXPRESSED OR IMPLIED, OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR OTHERWISE, INCLUDING, BUT NOT LIMITED TO; THE FITNESS FOR USE, DESIGN OR CONDITION OF THE UNITS; THE QUALITY OR CAPACITY OF THE UNITS; THE WORKMANSHIP IN THE UNITS; THAT THE UNITS WILL SATISFY THE REQUIREMENT OF ANY LAW, RULE, SPECIFICATION OR CONTRACT PERTAINING THERETO; AND ANY GUARANTEE OR WARRANTY AGAINST PATENT INFRINGEMENT OR LATENT DEFECTS, IT BEING AGREED THAT ALL SUCH RISKS, AS BETWEEN LESSOR AND LESSEE, ARE TO BE BORNE BY LESSEE. LESSOR IS NOT RESPONSIBLE OR LIABLE FOR ANY DIRECT, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGE TO OR LOSSES RESULTING FROM THE INSTALLATION, OPERATION OR USE OF THE UNITS OR ANY UNIT. Lessor acknowledges that any manufacturer’ and/or seller’s warranties are for the benefit of both Lessor and Lessee.
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6. USE OF THE UNITS. Lessee agrees to comply in with all laws or rules of the jurisdictions in which operations involving any Unit subject to this Lease may extend. Lessee shall indemnify and hold harmless Lessor from and against any and all liability that may arise from any infringement or violation of any such laws or rules by Lessee, its agents, employees, or any other person.
Lessee agrees that the Units shall be used in a careful and prudent manner, solely in the use, service and manner for which they were designed. Lessee shall not use the Units, or any Unit, for the loading, storage or hauling of any ruminant protein products, corrosive, hazardous, toxic or radioactive substance or material. Specifically, Lessee intends to use the Units to transport Coal. Lessee is prohibited from using the Units to transport any other commodity without Lessor’s prior written consent.
7. FILINGS AND MARKS. Lessee will cause each Unit to be kept numbered with the identifying numbers and all other markings and stenciling required by the Interchange Rules and the Codes of Car Hire and Car Service Rules of the Association of American Railroads, as the same may be amended from time to time.
8. TAXES, LIENS AND OTHER ASSESSMENTS. Lessee will keep at all times all and every part of the Units free and clear of all Assessments which might in any way affect the title of Lessor to any Unit or result in a lien upon any Unit.
9. INDEMNIFICATION.
(a) Lessee assumes all liability for and shall indemnify and hold harmless Lessor, its affiliates and subsidiaries together with its and their directors, officers, employees, agents, representatives, successors and assigns from and against any and all liabilities, obligations, losses, damages, injuries, claims, demands, penalties, actions, costs and expenses, including reasonable attorney’s fees, of whatsoever kind and nature, arising out of the possession, use, condition (including but not limited to, latent and other defects and whether or not discoverable by Lessee or Lessor), operation, ownership, selection, delivery, leasing or return of the Units or any Unit, regardless of where, how and by whom operated, and regardless of any failure on the part of Lessor to perform or comply with any conditions of this Lease. This Section 9 shall continue in full force and effect notwithstanding the expiration or other termination of this Lease. Lessee is an independent contractor and nothing contained in this Lease shall authorize Lessee or any other person to operate any of the Units so as to incur or impose any liability or obligation for or on behalf of Lessor.
(b) Lessor shall not be liable for any loss of or damage to any commodities loaded or shipped in the Units. Lessee agrees to assume responsibility for and to indemnify and hold harmless Lessor, its affiliates and subsidiaries together with its and their directors, officers, employees, agents, representatives, successors and assigns from any claim in respect of such loss or damage caused to any Unit by such commodities.
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10. LESSOR’S PERFORMANCE OF LESSEE’S OBLIGATIONS. If Lessee shall fail to duly and promptly perform any of its obligations under this Lease with respect to the Units, and Lessor has given Lessee reasonable prior written notice of such nonperformance, then Lessor shall have the option, but not the obligation, to perform any act or make any payment which Lessor deems necessary for the maintenance and preservation of the Units and/or Lessor’s title thereto, and all sums so paid or incurred by Lessor shall be reimbursed by Lessee on demand. The performance of any act or payment by Lessor as aforesaid shall not be deemed a waiver or release of any obligation or default on the part of the Lessee, and Lessee shall continue to be liable for any such performance or payment by Lessor notwithstanding the expiration or earlier termination of this Lease.
11. INSURANCE.
(a) Lessee shall procure and maintain prior to Lessor’s release of the Units, at its sole cost and expense, for all Units subject to this Lease: (1) comprehensive general liability insurance, including products liability and contractual coverage for the liabilities assumed herein, without exclusions related to railroad operations, punitive damages, hazardous materials transportation or otherwise, against liability and claims for injuries to persons (including injuries resulting in death), and property damage. Such coverage shall name Lessor as additional insured as the Lessor’s interest may appear and shall be in a combined single limit of not less than $2,000,000; and (2) all risk property insurance relating to loss of or damage to the Units in such amounts not less than $2,000,000. Such coverage shall name Lessor as loss payee. The Lessor is entitled, as loss payee, to act with Lessee in making, adjusting or settling any claims under any insurance policies insuring the Units leased by Lessee. Lessee shall furnish certificates, policies, or endorsements to Lessor as proof of such insurance. Notwithstanding anything herein to the contrary, Lessee may in its sole discretion self-insure for part or all of the insurance coverage required by this paragraph, in lieu of purchasing insurance.
(b) The proceeds of any all risk property damage with respect to such Units shall be payable solely to Lessor and shall be applied by Lessor in accordance with Section 12 hereof. The proceeds of any comprehensive general liability insurance shall be payable first to Lessor to the extent of its liability, if any, and the balance to Lessee.
12. RISK OF LOSS. Lessee assumes all risk of loss, damage, theft, condemnation or destruction of the Units, whether direct, indirect, incidental or consequential, including, but not limited to, damages caused by or arising from cornering, sideswiping, derailment, improper or abusive loading or unloading methods, negligent or unfair usage, or similar occurrences while under this Lease.
13. LESSEE’S DEFAULT. Lessee shall be in default under this Lease upon the happening of any of the following events or conditions (hereinafter referred to as “Events of Default”): (i) if Lessee fails to pay any sum required to be paid hereunder on or before the due date and such failure continues for a period of three (3) consecutive days; (ii) if Lessee fails at any time to procure or maintain any insurance coverage
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required by this Lease; (iii) if Lessee fails to observe or perform any of the covenants, conditions or obligations contained in this Lease (other than those specified in (i) and (ii) above) and such failure continues for ten (10) days after receipt by Lessee of written notice from Lessor of such failure; (iv) the appointment of a receiver, trustee or liquidator of Lessee or of a substantial part of its property, or the filing by Lessee of a voluntary petition in bankruptcy or other similar insolvency laws or for reorganization; (v) if a petition against Lessee in a proceeding under bankruptcy laws or other similar insolvency laws shall be filed and shall not be withdrawn or dismissed within thirty (30) days thereafter; (vi) if an event of default shall occur under any other obligation Lessee owes to Lessor; or (vii) if an event of default shall occur under any indebtedness Lessee may now or hereafter owe to any affiliate or subsidiary of Lessor.
14. LESSOR’S REMEDIES. Upon the occurrence of any one or more of the Events of Default specified in Section 13 above, Lessor, may at its option and without any further notice: (i) terminate this Lease as to any or all Units without relieving Lessee of any of its obligations hereunder; (ii) take possession of the Units and for this purpose enter upon any premises of Lessee and remove the Units, without any liability or suit, action or other proceeding by Lessee and without relieving Lessee of any of its obligations hereunder; (iii) cause Lessee, at its sole expense, to promptly return the Units to Lessor in accordance with the terms and provisions of Section 15 hereof; (iv) proceed by appropriate action either at law or in equity to enforce performance by Lessee of the applicable covenants of this Lease or to recover damages for the breach thereof; or (v) exercise any other right available to Lessor at law or in equity.
15. RETURN OF UNITS. At the expiration of this Lease, or at the direction of Lessor pursuant to Section 14 of this Lease, Lessee shall at its own cost, expense and risk, deliver possession of the Units to Lessor at the Spring Creek Mine in Xxxxxx Montana. Each Unit returned to the Lessor pursuant to this Section 15 shall: (i) be empty, free from debris, lading, residue of lading, suitable for loading, and in the same or better operating order, repair and condition as when originally delivered to the Lessee, reasonable wear and tear excepted; (ii) meet the standards then in effect under the Interchange Rules of the Association of American Railroads, the Surface Transportation Board, the Department of Transportation, and any other legislative, administrative, judicial, regulatory or governmental body having jurisdiction in the matter; and (iii) be free from any damage due to the abuse of the Unit as specified in Section 4(c). If any Unit is not delivered to Lessor on or before the Expiration Date, or is so delivered, but not in compliance with this Section 15, each and every Unit shall remain subject to the terms and provisions of this Lease until the Unit or Units are returned to Lessor or until any non-compliance with this Section 15 is resolved. Nothing in this Section 15 shall be construed as Lessor’s authorization of the Lessee’s use of the Units, or any Unit, after the Expiration Date. Lessee’s obligations in this Section 15 shall survive the Expiration Date of this Lease.
16. NOTICES. Any notice required or permitted to be given by any party hereto to the other shall be in writing and shall be deemed given when sent by United States Certified or Registered Mail, Return Receipt Requested, postage prepaid,
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delivered by personal or overnight courier, facsimile transmission, or e-mail addressed as follows:
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TO LESSOR: |
Northern
Coal Transportation Company |
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TO LESSEE: |
Minn-Dak Farmers
Cooperative |
or at such other place as the parties hereto may from time to time designate by notice, each to the other.
17. SEVERABILITY. Any provision of this Lease which is prohibited or unenforceable in any jurisdiction, shall be, as to such jurisdiction, ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
18. MISCELLANEOUS PROVISIONS.
(a) This Lease constitutes the entire agreement among the parties and exclusively and completely states the rights of the Lessor and the Lessee with respect to the Units and supersedes all other Leases, oral or written, with respect to the Units. No variation or modification of this Lease and no waiver of any of its provisions or conditions shall be valid unless in writing and signed by duly authorized officers of Lessor and Lessee.
(b) This Lease may be executed in several counterparts, each of which so executed shall be deemed to be an original, and such counterparts together shall constitute but one and the same instrument.
(c) The laws of the State of Wyoming shall govern this Lease.
(d) Lessee agrees to execute and deliver such other documents and instruments as may be reasonably necessary or required to further evidence the transaction contemplated by, or to carry out the intent of, this Lease.
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(e) Nothing contained herein shall give or convey to Lessee any right, title or interest in and to the Units leased hereunder except as a lessee thereof, and the Units are and shall at all times be and remain the sole and exclusive property of Lessor.
(f) Lessee may not, by operation of law or otherwise, assign, transfer, pledge, or otherwise dispose of this Lease or any interest herein, or sublet any of the Units, without Lessor’s prior written consent.
(g) Any cancellation or termination of this Lease by Lessor, pursuant to the terms and provisions hereof shall not release Lessee from any then outstanding obligations and/or duties to Lessor hereunder.
(h) Notwithstanding anything contained in this Lease to the contrary, Lessor shall not be liable for its failure to perform any obligations of Lessor herein contained by reason of labor disturbances (including strikes and lockouts), war, riots or civil commotion, acts of God, acts of terrorism, fires, floods, explosions, storms, accidents, governmental regulations or interference, or any cause whatsoever beyond Lessor’s reasonable control.
(i) To the extent there exists any conflict between the terms and provisions of this Lease and the terms and provisions of the Interchange Rules or the Codes of Car Hire and Car Service Rules of the Association of American Railroads, this Lease shall control.
(j) Lessee hereby authorizes Lessor, and agrees that Lessor shall be entitled, to access UMLER and receive all information thereon with respect to the Units, or the use and operation thereof, together with all other information as may be available from the Association of American Railroads, and Lessee agrees to execute such instruments or consents as may be necessary or required in order to carry out the intent of this paragraph (j).
(k) Whenever approval of the originating line haul carrier(s) is required in order for the Units to be placed in service pursuant to AAR Circular OT-5 including any revisions, replacements, or substitutions thereto, Lessor shall, upon written request from Lessee, use its reasonable efforts to assist Lessee in obtaining such approval. In no event shall Lessor be responsible for obtaining such approval, and in the event that the OT-5 authority is withdrawn, modified or denied, Lessee’s obligations under this Lease shall continue in full force and effect.
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IN WITNESS WHEREOF, the parties have caused this Lease to be executed as of the day and year first above written.
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LESSOR: |
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NORTHERN COAL TRANSPORATION COMPANY |
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BY: |
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NAME: |
Xxxxxxx X. Xxxxx |
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TITLE: |
VP, Marketing, Government Affairs & Communication |
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LESSEE: |
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MINN-DAK FARMERS COOPERATIVE |
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BY: |
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NAME: |
Xxxx X. Xxxxxxx |
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TITLE: |
Purchasing Manager |
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