ETHANOL MARKETING
CONTRACT
THIS AGREEMENT
is entered into by and among Eco-Energy, Inc. (hereinafter
“ECO”) a Tennessee Corporation with its main office
located at 730 Cool Springs Blvd, Suite 130, Franklin,
Tennessee 37067, and FIRST UNITED ETHANOL, LLC at 2 West Broad
Street, Camilla, GA 31730.
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A.
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FIRST UNITED ETHANOL, LLC, who is
developing an ethanol plant facility which expects to produce
approximately 110 million gallons per year of denatured
ethanol located in Camilla, Georgia that desires to establish an
output-marketing contract.
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B.
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ECO
is a reseller in ethanol and is experienced in the marketing and
transportation of such ethanol, and is desires to agree to purchase
the entire ethanol output of the plant.
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NOW,
THEREFORE, IT IS AGREED AS FOLLOWS BETWEEN THE
PARTIES:
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1.
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ECO Services
ECO shall, during the
term hereof, purchase the entire output of ethanol and to provide
certain transportation services to FIRST UNITED ETHANOL, LLC (the
“ECO Program”). The ECO services to be provided are set
forth in Sections 2 and 3 and the exhibits attached hereto
which are referred to therein.
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2.
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ECO Take or Pay Ethanol
Purchases FIRST UNITED ETHANOL, LLC agrees to
sell to ECO, and ECO agrees to purchase from FIRST UNITED ETHANOL,
LLC 100% of the production of ethanol during the term of the
contract. Each potential ECO purchase will be presented to the
FIRST UNITED ETHANOL, LLC representative by ECO for verbal
approval. Upon such verbal approval and purchase, a confirmation of
the purchase contract will be submitted to FIRST UNITED ETHANOL,
LLC, by ECO, encompassing the details of each purchase.
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3.
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ECO Transportation
Services ECO agrees to provide the
transportation services set forth in Exhibit B.
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4.
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Fees FIRST UNITED ETHANOL, LLC shall pay
a fee for services of ECO and materials provided hereunder of $.01
per net gallon of ethanol purchased for rail cars by ECO and $.012
per net gallon of ethanol purchased for outbound trucks by ECO
during the term of the contract. Such fees shall be payable monthly
on actual gallons shipped from the prior month. Payment from FIRST
UNITED ETHANOL, LLC shall be subtracted from ECO’s first
weekly wire payment of the following month for ethanol
purchases.
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5.
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FIRST UNITED ETHANOL, LLC
Representative FIRST UNITED ETHANOL, LLC shall
designate one or more persons who shall be authorized and directed
to receive services hereunder and to make all merchandising,
purchasing and sales decisions for FIRST UNITED ETHANOL, LLC. All
directions, transactions and authorizations given by such
representative to ECO shall be binding upon FIRST UNITED ETHANOL,
LLC. ECO shall be entitled to rely on the authorization of such
persons until it receives written notification from FIRST UNITED
ETHANOL, LLC that such authorization has been revoked. The terms of
such purchase orders shall be consistent with the provisions of
Exhibit A and may include, but shall not necessarily be
limited to, price, volume, delivery schedule, and shipping
instructions.
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6.
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Swaps and Exchanges
ECO shall provide 50% of
entitled swaps and exchanges to FIRST UNITED ETHANOL, LLC.
Entitlement is defined by the additional profits created during
swaps and exchanges, which occur prior to delivery. The value of
these swaps and exchanges shall be expressed in the form of a net
differential. Documentation of all swaps and exchanges will be made
in the form of a quarterly report. This report shall be generated
and payment submitted to FIRST UNITED ETHANOL, LLC by the final
business day of the month following the end of the calendar
quarter.
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1
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(a)
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ECO
assumes no responsibility for the completion or performance of any
contracts between FIRST UNITED ETHANOL, LLC and FIRST UNITED
ETHANOL, LLC’s customers and suppliers, and FIRST UNITED
ETHANOL, LLC agrees they shall not bring any action or make any
claim against ECO based on any act, omission or claim of any of
FIRST UNITED ETHANOL, LLC’s customers or
suppliers.
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(b)
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FIRST UNITED ETHANOL, LLC is
responsible to cover all non-deliveries of any product that is
contracted between ECO and FIRST UNITED ETHANOL, LLC in a timely
manner in order to stay within the time parameters of the contract.
ECO will assist in procuring product from other suppliers to cover
these non-deliveries.
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(c)
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If
any party terminates this agreement for any reason, both parties
will be responsible to complete any existing contracts.
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8.
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Separability and
Non-liability The services, contracts and
relationships between FIRST UNITED ETHANOL, LLC and ECO are
independent and separable.
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9.
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Confidentiality
Agreement The parties agree, to the extent
permitted by law, to preserve and protect the confidentiality of
the Agreement. Both parties recognize that federal or state law may
require the filing of the Agreement with, or the furnishing of
information to, governmental authorities or regulatory agencies.
Both parties further recognize the need, from time to time, for the
submission of the Agreement to affiliates, consultants, or
contractors performing work on, or related to, the subject matter
of the Agreement. Buyer and Seller agree to allow the submission of
the Agreement to affiliates, consultants, or contractors if such
affiliates, consultants, or contractors agree to protect the
confidentiality of the Agreement. In the event either party is of
the opinion that applicable law requires it to file the Agreement
with, or to disclose information related to the Agreement (other
than information required by laws and regulations in effect as of
the date hereof to be furnished in periodic reports to governmental
authorities) to, any judicial body, governmental authority or
regulatory agency, that party shall so notify the other party in
writing prior to the disclosure or filing of the
Agreement.
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10.
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Public Disclosure
Any public announcements
concerning the transaction contemplated by this letter shall be
approved in advance by ECO and FIRST UNITED ETHANOL, LLC, except
for disclosures required by law, in which case the disclosing party
shall provide a copy of the disclosure to the other party prior to
its public release.
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11.
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Solicitation
FIRST UNITED ETHANOL,
LLC agrees not to contact or interfere with, solicit, disrupt or
attempt to disrupt relationships, contractual or otherwise, between
Eco and any of its’ customers, employees or
vendors.
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12.
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Terms and
Termination
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(a)
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The
initial term of this Agreement shall commence on the first day of
ethanol production and shall continue until the October following
two (2) years full years of production. This contract will
automatically renew for an additional term of two (2) years
unless FIRST UNITED ETHANOL, LLC gives written notice at least four
(4) months prior to the end of the initial term.
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(b)
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This agreement may be terminated by
FIRST UNITED ETHANOL, LLC as to ECO in the event of material breach
of any of the material terms hereof by such other party, by written
notice specifying the breach, which notice shall be effective
fifteen (15) days after it is given unless the receiving party
cures the breach within such time. This agreement may be terminated
by ECO as to FIRST UNITED ETHANOL, LLC in the event of material
breach of any of the material terms hereof by FIRST UNITED ETHANOL,
LLC, by written notice specifying the breach, which notice shall be
effective fifteen (15) days after it is given unless the
receiving party cures the breach within such time. Any material
breach by FIRST UNITED ETHANOL, LLC as to ECO or by ECO as to FIRST
UNITED ETHANOL, LLC that cannot be resolved within 15 days,
both parties may mutually agree in writing to the length of time
needed to resolve the material breach.
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(c)
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This Agreement may also be
terminated between either party by the mutual consent of both
parties on such terms as the parties may agree.
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(d)
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In
addition to any other method of terminating this Agreement, ECO may
unilaterally terminate this Agreement at any time if such
termination shall be required by any regulatory authority, and such
termination shall be effective on the 30 th day following the giving of notice
of intent to terminate.
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13.
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Licenses, Bonds, and
Insurance Each party represents that it now
has and will maintain in full force and effect during the term of
this Agreement, at its sole cost, all necessary state and federal
licenses, bonds and insurance in accordance with applicable state
or federal laws and regulations.
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14.
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Limitation of
Liability EACH PARTY UNDERSTANDS THAT NO
OTHER PARTY MAKES ANY GUARANTEE, EXPRESS OR IMPLIED, TO ANY OTHER
OF PROFIT, OR OF ANY PARTICULAR ECONOMIC RESULTS FROM TRANSACTIONS
HEREUNDER. IN NO EVENT SHALL ANY PARTY BE LIABLE FOR SPECIAL,
COLLATERAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES FOR ANY ACT OR
OMISSION COMING WITHIN THE SCOPE OF THIS AGREEMENT, OR FOR BREACH
OF ANY OF THE PROVISIONS OF THIS AGREEMENT, EVEN IF IT HAS BEEN
ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. SUCH EXCLUDED DAMAGES
INCLUDE, BUT ARE NOT LIMITED TO, LOSS OF GOOD WILL, LOSS OF
PROFITS, LOSS OF USE AND INTERRUPTION OF BUSINESS.
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15.
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Disclaimer
FIRST UNITED ETHANOL,
LLC understands and agrees that ECO makes no warranty respecting
legal or regulatory requirements and risks. FIRST UNITED ETHANOL,
LLC shall obtain such legal and regulatory advice from third
parties as it may deem necessary respecting the applicability of
legal and regulatory requirements applicable to FIRST UNITED
ETHANOL, LLC business.
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16.
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Indemnity
The Parties agree that
they shall absolve, release and refrain from seeking remedies
against each other and their officers, agents, employees,
subcontractors and insurers for any and all losses, claims,
damages, costs, suits and liabilities for damage, deterioration of
quality, shrinkage in quantity, loss of grade or loss of Ethanol
resulting from the inherent nature of transfer operations and the
inherent nature of Ethanol provided that this in no way shall
relieve the parties for their own negligence, willful misconduct or
theft. Each party to this contract shall indemnify, defend and hold
the other harmless from claims, demands and causes of action
asserted against the other by any person (including without
limitation employees of either party) for personal injury or death,
or for loss of or damage to property resulting from the willful or
negligent acts or omissions of the indemnifying party. Where
personal injury, death or loss of
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or
damage to property is the result of the joint negligence or
misconduct or the Parties hereto, the Parties expressly agree to
indemnify each other in proportion to their respective share of
such joint negligence or misconduct.
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17.
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Nature of
Relationship ECO is an independent contractor
providing services to FIRST UNITED ETHANOL, LLC. No employment
relationship, partnership or joint venture is intended, nor shall
any such relationship be deemed created hereby. Each party shall be
solely and exclusively responsible for its own expenses and costs
of performance.
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18.
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Notices Any notices permitted or required
hereunder shall be in writing, signed by an officer duly authorized
of the party giving such notice, and shall either be hand delivered
or mailed. If mailed, notice shall be sent by certified, first
class, return receipt requested, mail to the address shown above,
or any other address subsequently specified by notice from one
party to the other.
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19.
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Compliance With Governmental
Controls To the extent applicable, the
parties agree to comply with all laws, ordinances, rules, codes,
regulations and lawful orders of any federal, state or local
government authority applicable to the performance of the
Agreement, including, without limitation, those pertaining to the
environment, safety, health, social security, old age pension, wage
hour laws, unemployment compensation, non-discrimination on the
basis of race, religion, color, sex or national origin and
affirmative action.
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20.
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New Or Changed
Regulations The parties enter the Agreement in
reliance upon the laws, rules, regulations, interpretations,
decrees, agreements, and concessions of, and arrangements
(hereafter called “Regulations”) with governments or
governmental instrumentalities in effect on the date of the
Agreement with respect to or directly or indirectly affecting the
ethanol to be delivered, including without limitation, production,
gathering, manufacturing, transportation, sale and delivery thereof
insofar as said Regulations affect ECO and their customers. In the
event that at any time subsequent to the date of the Agreement, any
of said Regulations are changed or new Regulations are promulgated
whether by law, decree, interpretation or regulation, or by
response to the insistence or request of any governmental authority
or person purporting to act therefore, and the effect of such
changed or new Regulation (a) is or will not be covered by any
other provisions of the Agreement, or (b) has or will have an
adverse economic effect upon the parties to this Agreement or the
suppliers or customers of said parties, the parties shall have the
option to request renegotiation of the prices and other pertinent
terms provided for in the Agreement and their respective effective
dates. Said option may be exercised by ECO at a
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