SEVENTH AMENDMENT TO LEASE AGREEMENT

 

THIS SEVENTH AMENDMENT TO LEASE AGREEMENT (“ Seventh Amendment ”) is made and entered into this 23rd day of April, 2009 by and among the PORTS OF INDIANA, a body corporate and politic existing under the laws of the State of Indiana and formerly known as the Indiana Port Commission (the “ Ports ”), AVENTINE RENEWABLE ENERGY-MT VERNON, LLC a Delaware Limited Liability Company (“ Lessee ”, and together the “ Parties ”) and AVENTINE RENEWABLE ENERGY HOLDINGS, INC. (“ Guarantor ”).

 

RECITALS:

 

A.            The Ports is charged with the management and operation of the Ports of Indiana, including the Port of Indiana-Mount Vernon, in Posey County, Indiana (the “ Port ”).

 

B.            The Parties entered into a certain Lease Agreement dated October 31, 2006, which was executed by the Office of the Attorney General and the Office of the Governor on January 19, 2007 and January 24, 2007 respectively (the “ Original Lease ”), which Original Lease was amended by (i) a certain First Amendment to Lease Agreement and Reaffirmation of Guaranty dated June 14, 2007 among the Parties and Guarantor, (ii) a certain Second Amendment to Lease Agreement and Reaffirmation of Guaranty dated October 18, 2007 among the Parties and Guarantor, (iii) a certain Third Amendment to Lease Agreement and Reaffirmation of Guaranty dated December 20, 2007 among the Parties and Guarantor, (iv) a certain Fourth Amendment to Lease Agreement and Reaffirmation of Guaranty dated June 19, 2008, (v) a certain Fifth Amendment to Lease Agreement and Reaffirmation of Guaranty dated December 18, 2008 among the Parties and Guarantor; and, (vi) a certain Sixth Amendment to Lease Agreement and Reaffirmation of Guaranty among the Parties and Guarantor dated February 12, 2009,  (said Original Lease as amended is herein referred to as the “Lease”), whereby the Ports leased to Lessee and Lessee leased from the Ports that certain real estate described in the Lease, located at the Port of Indiana-Mount Vernon, a port managed and operated by the Ports in Posey County, Indiana.

 

C.            The Parties have agreed to amend the Lease to remove from the Leased Premises approximately 4+/- acres (hereafter “ Tract 2 ”) (Tract 1 being the subject of the Sixth Amendment to Lease Agreement and Reaffirmation of Guaranty) and the return of Tract 2 to the Ports for the inclusion of said Tract 2 with other property for the lease to a third party for the construction of a new project at the Port and to make other changes in the legal descriptions of the Leased Premises.

 

D.            Guarantor is joining in the execution of this Seventh Amendment solely for purposes of consenting to all provisions of this Seventh Amendment.

 

E.             On April 7, 2009, Lessee and Guarantor, together with the latter’s affiliates, filed for protection under chapter 11 of title 11 of the United States Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”).

 

F.             Lessee, the Ports and Guarantor have each had substantial participation in the preparation of this Seventh Amendment which shall become effective upon entry of a final non-

 

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appealable Order of the Bankruptcy Court authorizing the Lessee’s and Guarantor’s entry into and approving this Seventh Amendment.

 

G.            At a properly convened public meeting of the Commission of the Ports, the duly authorized officers have approved the execution and delivery of this Seventh Amendment.

 

NOW, THEREFORE, in consideration of the foregoing premises, the mutual undertakings hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Ports, Lessee and Guarantor (solely for purposes of its agreement to the provisions of Paragraphs 7 and 8 below) hereby agree as follows:

 

1.             The Ports requested and the Lessee has consented to the release of Tract 2 from its Lease so that said tract could be combined with other Port real property for the development and construction of a new project and lease agreement with a new tenant at the Port.

 

2.             The Parties agree the land to be surrendered back to the Ports pursuant to this Seventh Amendment and defined herein as Tract 2, consists of approximately 4 +/- acres and is more particularly described and depicted in the drawing and description attached hereto, made a part hereof, and marked as Exhibit 1-7thAmendment .  A metes and bounds description, as well as the actual acreage of Tract 2, will be established by the “as built” ALTA/ACSM Land Title Survey of the Leased Premises, containing Table A Items 1-4, 6, 7a, 8-10, 11a and 13 (the “ As Built Survey ”) to be provided by Lessee pursuant to paragraph 4 hereafter.

 

3.             Attached to the Fourth Amendment, as well as to this Seventh Amendment, is Exhibit A — Description of Leased Real Estate , (“ Exhibit A ”).  Exhibit A describes the Leased Premises as consisting of 118.05 acres.

 

4.             By agreement of the Parties the final As Built Survey (depicting the final boundary line of the Leased Premises, together with all necessary easements, rights of way and deletions of acreage) is to be performed by Lessee when the project is at a stage when the actual boundaries are readily identifiable, but in no event later than December 31, 2009.

 

5.             Article III of the Lease provides that Lessee shall pay Initial Ground Rent of Three Thousand Two Hundred Dollars ($3,200) per acre per year, and Section 1.01 of the Lease identifies the demised real estate as approximately 116 acres, more or less.

 

6.             It is further agreed by the Parties that an adjustment to the Initial Ground Rent paid and payable by Lessee will be made upon completion of the As Built Survey.  The Parties acknowledge that since the execution of the Lease, Lessee has occupied more than the 116 acres.  Specifically, Lessee has occupied 117.808 acres from October 31, 2006 until increased to 118.05 on June 19, 2008; reduced by 2.37 acres on February 12, 2009, and further reduced by 4 +/-acres on April 23, 2009. Commencing on May 1, 2009 and continuing until the As Built Survey is completed and the adjustment to the Initial Ground Rent is calculated, the Initial Ground Rent shall be based upon 112 acres (being the 116 acres referenced in Section 5 above less the 4+/- acres of Tract 2 surrendered back to the Ports by this Seventh Amendment).  Upon completion of the As Built Survey, the Ports will calculate the actual Initial Ground Rent that should have been paid since October 31, 2006 based upon the actual acreage occupied by Lessee as such acreage

 

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has changed as set forth above (the “ True Up Rent ”).  The Initial Ground Rent that has been paid based upon the 116 acres thru May 1, 2009 and 112 acres thereafter shall be subtracted from the True Up Rent and the difference, if any, shall be paid by Lessee within 30 days of receipt of the invoice from the Ports.  In the event that the result of the True Up Rent comparison is a negative amount, such that Lessee has overpaid based on actual acreage occupied, then the Port shall issue a credit to Lessee on the next month’s rent due.

 

7.             Lessee hereby releases and surrenders back to the Ports Tract 2, and the Ports hereby accept Tract 2 and the same is hereby removed and deleted from the Demised Premises.

 

8.             Guarantor hereby consents to the amendments to the Lease made by this Seventh Amendment and agrees that such amendments shall not affect, impair, discharge, relieve or release Guarantor of its obligations under the terms of the Lease Guaranty, and that such Lease Guaranty shall be deemed to reference the Lease as amended hereby.

 

9.             The Ports and Lessee agree that the above and foregoing Recitals are true, correct and complete and are hereby incorporated and made a part of this Seventh Amendment as if completely and fully set forth herein.  Capitalized terms used in this Seventh Amendment without definition shall have the meanings set forth in the Lease as previously amended, except that any internal references in the Lease to the word “ Lease ” shall mean the Lease, as previously and hereby amended, wherever the context so requires in order to give meaning to this Seventh Amendment.

 

10.           This Seventh Amendment shall be incorporated into and made a part of the Lease and all provisions thereof not expressly modified or amended hereby shall remain in full force and effect.  Nothing contained in this Seventh Amendment (except, as applicable, for the specific amendments to the Lease set forth in this Seventh Amendment) shall release or relieve Lessee or Ports from their respective obligations or liabilities under the Lease accruing prior to the date hereof.

 

11.           Except as expressly amended and modified by this Seventh Amendment and subject to Section 12 below, the Lease shall otherwise remain in full force and effect, the parties hereto hereby ratifying and confirming the same.  This Seventh Amendment, together with the Lease, is the complete understanding between the parties and supersedes all other prior agreements and representations concerning its subject matter.  To the extent of any inconsistency between the Lease and this Seventh Amendment, the terms of this Seventh Amendment shall control.

 

12.           Notwithstanding anything set forth herein to the contrary, the Ports execution of this Seventh Amendment does not waive any rights or remedies the Ports has in connection with any failure of Lessee to comply with the terms and conditions of the Lease prior to the date hereof, including but not limited to any rights or remedies of the Ports arising due to the filing of mechanic’s liens by Lessee’s contractors, subcontractors and/or other third parties.

 

13.           Notwithstanding anything set forth herein to the contrary, the Lessee’s execution of this Seventh Amendment does not waive any rights or remedies the Lessee has in connection

 

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with any failure of the Ports to comply with the terms and conditions of the Lease prior to the date hereof.

 

14.           This Seventh Amendment is subject to the entry of a final non-appeal Order by the Bankruptcy Court authorizing the Lessee’s and the Guarantor’s entry into and approving this Seventh Amendment.

 

15.           Notwithstanding anything contained herein, the entry by the Lessee and the Guarantor into this Seventh Amendment and/or the entry of an Order by the Bankruptcy Court authorizing the Lessee’s and the Guarantor’s entry into this Seventh Amendment shall not be construed or deemed to be an assumption of the Lease.

 

16.           The Parties agree that the deadline set forth in section 365(d)(4)(A) of the Bankruptcy Code by which the Lessee must assume or reject the Lease shall be extended through and including April 7, 2010 and that, for all purposes, including satisfaction of the requirements of § 365(d)(4)(B)(ii) of the Bankruptcy Code, the Seventh Amendment shall constitute the Landlord’s irrevocable consent to such extension.

 

17.           Immediately following the signature page of this Seventh Amendment is the Addendum of State required contract provisions previously executed by the Parties.  The Parties reaffirm the covenants and affirmations contained in said Addendum and incorporate the same into this Seventh Amendment.

 

(Remainder of Page left blank, signature Page to follow)

 

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IN WITNESS WHEREOF, the parties hereto have executed this Seventh Amendment as of the day, and month and year first above-written.

 

			PORTS OF INDIANA
			“Ports”
ATTEST:
By:	/s/ Tony Walker		By:	/s/ Gregory Gibson
	Tony Walker, Assistant Secretary			Gregory Gibson,
				Designated Commissioner
			AVENTINE RENEWABLE ENERGY-
			MT.  VERNON, LLC
			“Lessee”
ATTEST:
/s/ George T. Henning, Jr.			/s/ Ronald H. Miller
(Signature)			(Signature)
George T. Henning, Jr.			Ronald H. Miller
(Printed name and title)			(Printed name and title)
			AVENTINE RENEWABLE ENERGY
			HOLDINGS, INC.
			“Guarantor”
ATTEST:
/s/ George T. Henning, Jr.			/s/ Ronald H. Miller
(Signature)			(Signature)
George T. Henning, Jr.			Ronald H. Miller
(Printed name and title)			(Printed name and title)
Approved as to form and legality
This 1 st  day of June, 2009
			APPROVED
/s/ Susan W. Gard			DATE:  July 7, 2009
For Gregory F. Zoeller
Attorney General of Indiana			/s/ Mitchell E. Daniels, Jr.
			For The Honorable Mitchell E. Daniels, Jr.
			Governor of Indiana

 

This instrument was prepared by David W. Haniford, General Counsel, Ports of Indiana, 150 W. Market St. Ste. 100 Indianapolis IN 46204-2845 Telephone: (317) 232-9204.

 

I affirm, under the penalties for perjury, that I have taken reasonable care to redact each Social Security number in this document, unless required by law.  David W. Haniford, Attorney at Law .

 

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ADDENDUM OF

 

STATE REQUIRED CONTRACT PROVISIONS

 

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EXHIBIT E

 

(IPC321.06)

 

ADDENDUM

 

This Addendum is entered into by and between the Ports of Indiana (the “ State ”) and Aventine Renewable Energy-Mt Vernon, LLC (the “ Contractor ”), and collectively known as the “ Parties ”.  The purpose of this Addendum is to modify, delete, or amend certain terms and conditions set forth in the attached Fifth Amendment (“ Agreement ”).  This Addendum and the Agreement are incorporated into each other and, when read together, shall constitute one integrated document.  Any inconsistency, conflict, or ambiguity between this Addendum and the Agreement shall be resolved by giving precedence and effect to this Addendum.

 

Authority to Bind Contractor

 

The signatory for the Contractor represents that he/she has been duly authorized to execute this Contract on behalf of the Contractor and has obtained all necessary or applicable approvals to make this Contract fully binding upon the Contractor when his/her signature is affixed, and certifies that this Contract is not subject to further acceptance by Contractor when accepted by the State of Indiana.

 

Compliance with Laws.

 

The Contractor shall comply with all applicable federal, state and local laws, rules, regulations and ordinances, and all provisions required thereby to be included herein are hereby incorporated by reference.  The enactment of any state or federal statute or the promulgation of nays or regulations thereunder after execution of this Contract shall be reviewed by the State and the Contractor to determine whether the provisions of this Contract require found modification.

 

The Contractor and its agents shall abide by all ethical requirements that apply to persons who have a business relationship with the State, as set forth in Indiana Code § 4-2-6 at seq., the regulations promulgated thereunder, and Executive Order 04-08, dated April 27, 2004.  If the tractor is not familiar with these ethical requirements, the contractor should refer any questions to the Indiana State Ethics Commission, or visit the Indiana State Ethics Commission website at http://www.in.gov/ethics/.  If the Contractor or its agents violate any applicable ethical standards, the State may, in its sole discretion, terminate this Contract subject to the notice and cure provisions of Sections 11.01(i) and 7.02 of the Agreement.  In addition, the Contractor may be subject to penalties under Indiana Code § 4-2-6-12.

 

The Contractor certifies by entering into this Contract, that neither it nor its principal(s) is presently in arrears in payment of its taxes; penult fees or other statutory, regulatory or judicially required payments to the State of Indiana.  Further, the Contractor agrees that any payments in arrears and currently due to the State of Indiana may be withheld from payments due to the Contractor.  Additionally, further work or payments may be withheld, delayed, or denied and/or this

 

 

Contract suspended until the Contractor is current in its payments and has submitted proof of such payment to the State.

 

The Contractor warrants that it has no current or pending or outstanding criminal, civil, or enforcement actions initiated by the State of Indiana pending, and agrees that it will immediately notify the State of any such actions.  During the term of such actions, Contractor agrees that the State may delay, withhold, or deny work under any Supplement or contractual device issued pursuant to this Contract and any supplements or amendments.

 

If a valid dispute exists as to the Contractor’s liability or guilt in any action initiated by the State of Indiana or its agencies, and the State decides to delay, withhold, or deny work to the Contractor, the Contractor may request that it be allowed to continue, or receive work, without delay.  The Contractor must submit, in writing, a request for review to the Indiana Department of Administration (IDOA) following the procedures for disputes outlined herein, A determination by IDOA shall be binding on the parties.

 

Any payments that the State may delay, withhold, deny, or apply under this section shall not be subject to penalty or interest under IC 5-17-5.

 

The Contractor warrants that the Contractor and its subcontractors’ if any, shall obtain and maintain all required permits, licenses, and approvals, as well as comply with all health, safety, and environmental statutes, rules, or regulations in the performance of work activities for the State.  Failure to do so may be deemed is a material breach of this Contract and grounds for Immediate termination of the Agreement and denial of further work with the Stet; subject to the notice and cars provisions of Sections 11.01(1) and 7.02 of the Agreement.

 

The Contractor hereby affirms that it is properly registered and owes no outstanding reports with the Indiana Secretary of State.

 

As required by IC 5-22-3-7:

 

the Contractor and any principals of the Contractor certify that (A) the Contractor, except for de minimis and nonsystematic violations, has not violated the terms of (i) IC 24-4.7 [Telephone Solicitation Of Consumers), (ii) IC 24-5-12 [Telephone Solicitations), or (iii) IC 24-5-14 [Regulation of Automatic Dialing Machines) in the previous three hundred sixty-five (365) days, even if IC 244.7 is preempted by federal law; and (B) the Contractor will not violate the terms of IC 24-4.7 for the duration of the Contract, even if IC 24-4.7 is preempted by federal law.

 

The Contractor and any principals of the Contractor certify that an affiliate or principal of the Contractor and any agent acting on behalf of the Contractor or on behalf of an affiliate ‘or principal of the Contractor: (A) except for de minimis and nonsystematic violations, has not violated the terms of IC 24-4.7 in the previous three hundred sixty-five (365) days,

 

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even if IC 24-4.7 is preempted by federal law; and (B) will not violate the terms of IC 24-4.7 for the duration of the Contract, even if IC 24-4.7 is preempted by federal law.

 

Conflict of interest.

 

As used in this section:

 

“ Immediate family ” means the spouse and the unemancipated children of an individual.

 

“ Interested party ” means:

 

1.                                        The individual executing this Contract;

 

2.                                        An individual who has an interest of three percent (3%) or more of Contractor, if Contractor is not an individual; or

 

3.                                        Any member of the immediate family of an individual specified under subdivision 1 or 2.

 

“ Department ” means the Indiana Department of Administration.

 

“ Commission ” means the State Ethics Commission.

 

The Department may cancel this Contract without recourse by Contractor if any interested party is an employee of the State of Indiana.

 

The Department will not exercise its right of cancellation under section B, above, if the Contractor gives the Department an opinion by the Commission indicating that the existence of this Contract and the employment by the State of Indiana of the interested party does not violate any statute or rule relating to ethical conduct of State employees.  The Department may take action, including cancellation of this Contract, consistent with an opinion of the Commission obtained under this section.

 

Contractor has an affirmative obligation under this Contract to disclose to the Department when an interested party is or becomes an employee of the State of Indiana.  The obligation under this section extends only to those facts that Contractor knows or reasonably could know.

 

Drug-Free Workplace-Certification.

 

The Contractor