Exhibit 10.1


 


LEASE AGREEMENT


By
and Between


The
Indiana Port Commission


And


Aventine
Renewable Energy-Mt Vernon, LLC


 
















LEASE AGREEMENT


THIS LEASE AGREEMENT (“Lease”)
is made and entered into this _____ day of October, 2006 between the INDIANA
PORT COMMISSION, a body corporate and politic existing under the laws of the
State of Indiana (the “Commission”)
and AVENTINE RENEWABLE ENERGY-MT VERNON, LLC an Delaware Limited Liability
Company (Lessee).


RECITALS:


A.            The
Commission 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.            Lessee
has discussed with the Commission the lease of certain property at the Port for
the construction and operation of an Ethanol Plant.  The Commission and Consolidated Grain and
Barge Co entered into an Option to Lease Real Estate on June 22nd 2006 and an
Amended Option to Lease Real Estate on August 17th, 2006.  The Option and Amended Option were assigned
to Lessee, with the consent of the Commission, on September 11, 2006.  Lessee exercised the Option on September 29,
2006.


C.            It
is anticipated by the Commission that the lease of such property to Lessee and
the use thereof by Lessee will contribute to the growth and development of the
Port.


D.            After
review by the Commission’s staff and in consideration of the benefits to be
derived from and the burdens imposed by Lessee’s use of such property, the
Commission has authorized the preparation of this Lease.


E.             Lessee
and the staff of the Commission have each had substantial participation in the
preparation of this definitive Lease, which shall, upon approval of this Lease
by the Governor of Indiana, become effective.


F.             At
a properly convened public meeting, the Commission has duly approved the
execution and delivery of this Lease by its duly authorized officers.


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 Commission and Lessee (the “Parties”)
hereby agree as follows:


ARTICLE I



LEASE OF THE PREMISES


Section 1.01.          THE
DEMISE.  The Commission does hereby
demise and lease to Lessee, and Lessee does hereby lease from the Commission,
that certain real estate consisting of approximately 116 acres, more or less,
located at the Port of Indiana-Mount Vernon, a port managed and operated by the
Commission in Posey County, Indiana; said real estate more





 1
 









particularly described and depicted in the drawings and descriptions
attached hereto, made a part hereof, and marked Exhibit A (the “Real
Estate”; the buildings, structures, fixtures and other improvements
now or hereafter located on the Real Estate being herein referred to as the “Improvements”; and the Real Estate and
Improvements being herein referred to as the “Leased
Premises”).  The Real Estate is
located within the Port more particularly described on Exhibit A-1 hereto.  Within sixty (60) days from the date hereof,
Lessee shall provide to the Commission at Lessee’s sole expense a current
ALTA/ACSM Land Title Survey of the Real Estate, containing Table A Items 1-4,
6, 7a, 8-10, 11a and 13 (the “Survey”).  Promptly after the receipt of the Survey, the
parties shall enter into amendments to this Lease and the Memorandum hereof in
form and substance reasonably satisfactory to each of them setting forth the
metes and bounds description of the Real Estate.  The demise further grants to Lessee:


(i)                                     the
non-exclusive right of ingress and egress to and from the nearest public roads
and to and from the Leased Premises over existing roads within the Port, as
such access may be changed from time to time by the Commission;


(ii)                                  the
non-exclusive right of ingress and egress to and from all public wharves
serving the Port and the Leased Premises, over existing roads and railroad
tracks within the Port, as such access may be changed from time to time by the
Commission; and


(iii)                               the
non-exclusive right and easement to install, maintain, use, operate, repair,
restore and relocate (A) water, gas, electric, sewer, drainage,
telecommunications and other utility lines, pipes, pumps, conduits, facilities
and equipment; (B) ethanol pipelines, facilities and equipment between the
Leased Premises and wharfs at the Port; (C) grain conveyor lines between the
Leased Premises and grain storage facilities and/or wharfs at the Port; (D)
roads and railroad tracks between the Leased Premises and the roads and
railroads within the Port.  The easements
under this clause (iii) shall be at locations to be requested by Lessee and
approved by the Commission.  Upon such
approval by the Commission, at the request of Lessee or the Commission, the
parties shall execute and deliver amendments to this Lease and any Memorandum
hereof in form and substance reasonably satisfactory to each of them reflecting
the location of the easement in question.  The facilities installed by Lessee in the
easements under this clause (iii) shall be installed, operated, maintained and
repaired by Lessee at its sole cost and expense as part of the Improvements,
shall be the property of Lessee and shall be for the exclusive use of
Lessee.  The Commission shall have the
right to use and to grant others the use of the land on which such easements
are located for other purposes that do not unreasonably interfere with the use
and operation of the facilities installed therein by Lessee.


(iv)                              The
Commission shall have the right at its sole cost and expense to relocate the
roads and railroads within the Port and the easements under clause (iii) and
the facilities Lessee’s facilities therein, provided that Lessee’s ingress and
egress to and from the Leased Premises and wharves serving the Port and use of
the facilities in the easements to be relocated is not interrupted for any
substantial period of time or diminished. 
In the event of any such relocation, at the request of



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Lessee or the
Commission, the parties shall execute and deliver amendments to this Lease and
any Memorandum hereof in form and substance reasonably satisfactory to each of
them reflecting the location of the new easement in question and releasing the
old easement.


Section 1.02.          THE
ADDENDUM.  Immediately following the
signature page of this Lease is the Addendum of State required contract
provisions.  The Addendum and this Lease
are incorporated into each other and, when read together, shall constitute one
integrated document.  Any inconsistency,
conflict, or ambiguity between the Addendum and this Lease shall be resolved by
giving precedence and effect to the Addendum.


ARTICLE II



TERM


Section 2.01.          APPROVAL
BY GOVERNOR.  This Lease is subject
to and conditioned upon the approval of the Governor of the State of
Indiana.  Lessee agrees that any of
Lessee’s Work performed by Lessee prior to the approval of this Lease by the
Governor of the State of Indiana or any other action taken or expense incurred
by Lessee shall be at the sole risk of Lessee. 
Lessee shall be without recourse against the Commission or the State of
Indiana in the event this Lease is not approved by the Governor of the State of
Indiana, and agrees to, and hereby does, hold the Commission harmless for any
loss asserted or claimed, and to indemnify and defend the Commission against
any such loss arising as a result of Lessee’s Work or occupancy of the Real
Estate prior to the approval of this Lease by the Governor.  If the Governor fails to approve this Lease,
Lessee agrees to restore, at its own expense, the Leased Premises substantially
to its original condition.


Section 2.02.          THE
ORIGINAL TERM.  The initial term of
this Lease (the “Original Term”)
shall commence on November 1, 2006, (the “Commencement
Date”), and shall end at midnight on the 31st day of October, 2026.


Section 2.03.          OPTIONS
FOR EXTENSIONS.  Lessee shall have
options to extend this Lease for six (6) additional consecutive terms of five
(5) years each (individually, an “Additional
Term” and, collectively, the “Additional
Terms”) commencing at the expiration of the Original Term or the
prior Additional Term at the rental rate (subject to adjustment as provided
herein) and subject to all of the other terms, covenants and conditions contained
in this Lease, all of which shall be applicable to the Additional Terms.  The Original Term and any Additional Term the
option for which is exercised may be referred to hereinafter collectively as
the “Demised Term”.


The option to extend the term of this Lease may be exercised only if no
Event of Default (as hereinafter defined) exists at the date of exercise or at
the end of the Original Term or the current Additional Term, if
applicable.  Notice of the exercise of an
option to extend the term of this Lease shall be received by the Commission no
later than one year prior to the expiration of the Original Term or the then
current Additional Term (the “Notice Date”).  If such notice is not given by the Notice
Date, the Lease shall terminate as of the end of the then current term.  If such



 3
 









notice is given by the Notice Date, the Lease, without further action
by the parties, shall be automatically extended for the Additional Term.


Section 2.04.          PREMISES
RESTORATION PLAN.  On or before
December 1 of the last year of the term of this Lease Agreement, Lessee shall
submit its Premises Restoration Plan to the Commission as provided in Article
XIV.


ARTICLE III



RENT


Section 3.01.          METHOD
AND MANNER OF PAYMENT.  Payment of
Basic Rent (hereafter defined) shall be made by check payable to the order of
Indiana Port Commission, mailed to the Commission at 150 West Market Street,
Suite 100, Indianapolis, Indiana 46204, or to such other payee or at such other
place as the Commission may designate from time to time in writing.


Section 3.02.          BASIC
RENT.  Lessee agrees to pay to the
Commission as rent for the Leased Premises a “Basic
Rent” composed of Ground Rent for the Leased Premises, as follows:


(a)           The annual ground
rental rate (the “Ground Rent”)
for the Leased Premises, from the Commencement Date through the fifth
anniversary of the Commencement Date, shall be Three Thousand Two Hundred
Dollars ($3,200) per acre for a total annual Ground Rent of Three Hundred Seventy One Thousand Two Hundred Dollars ($371,200)
(the “Initial Ground Rent”).  The Initial Ground Rent shall be payable in
advance in equal successive monthly installments commencing on the Commencement
Date (the “Initial Payment Date”)
and continuing thereafter on the first day of every calendar month until the
fifth anniversary of the Commencement Date. 
If the actual number of acres of the Real Estate as determined by the
Survey shall be more or less than 116 acres, at the request of Lessee or the
Commission, the Ground Rent shall be redetermined and parties shall execute and
deliver an amendment to this Lease in form and substance reasonably
satisfactory to each of them reflecting the redetermined Ground Rent.


(b)           An Option Fee of One
Hundred Thousand Dollars ($100,000) has been previously paid to the Commission.  Pursuant to the terms of the Amended Option
the Option Fee shall be applied in full to Lessee’s Basic Rent
obligations,  commencing with the
November 1, 2006 Basic Rent payment.


(c)           On November 1, 2011
and on each fifth year thereafter (each date referred to as a “Rental Adjustment Date”) a rental
adjustment (“Rent Adjustment”)
shall be made, which shall produce the “Adjusted
Ground Rent”.  Adjusted Ground
Rent shall be based upon increases in the Producer Price Index All Commodities,
1982=100(hereinafter called the “Index”)
published by the Bureau of Labor Statistics United States Department of
Labor.  For purposes of calculating the
first Adjusted Ground Rent, the “Final Index”
published immediately preceding the Commencement Date of November 1, 2006 shall
be the original base Index.  The term “Final Index” recognizes that the most
recent four-month figures of the Producer Price Index are subject to
revision.  Therefore the Commission will
select the most



 4
 









recent Final Index figure which under current procedure
will be that index four months prior to the Rental Adjustment Date.


Any increase in the Index from the original base Index to the Index
last published preceding the first Rental Adjustment Date shall be computed as
a percentage and the Adjusted Ground Rent to be paid by Lessee during the five
(5) year period immediately succeeding the first Rental Adjustment Date shall
be the Initial Ground Rent, multiplied by the sum of one hundred percent (100%)
plus such percentage change in the Index; but shall in no event be less than
the per acre annual Initial Ground Rent rate payable by Lessee, or the Adjusted
Ground Rent then payable.


For example, the calculation of Adjusted Ground Rent to be paid by
Lessee at the first Rental Adjustment Rate would be as follows:


	
  Original Base Index:

  	
   

  	
  100

  
	
  Index Last
  Published

  	
   

  	
   

  
	
  Preceding first
  Rental

  	
   

  	
   

  
	
  Adjustment Date:

  	
   

  	
  110

  
	
  % Change in
  Index:

  	
   

  	
  10%

  
	
   

  	
   

  	
   

  
	
  Adjusted Ground
  Rent:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  $3,200 x 110%

  	
   

  	
  $3,520*

  



*Figures assumed for purposes of demonstration only.


(d)           In computing the
rental adjustment for each subsequent Rental Adjustment Date, (the “Current Rental Adjustment Date”) the Index
last published preceding the last preceding Rental Adjustment Date (the “Prior Rental Adjustment Date”) shall be the
new base Index for purposes of calculating the Adjusted Ground Rent for the
five (5) year period commencing on the Current Rental Adjustment Date.  Any increase in the Index from the new base
Index to the Index last published preceding the Current Rental Adjustment Date
shall be computed as a percentage, and the Adjusted Ground Rent to be paid by
Lessee during the five (5) year period commencing on the Current Rental
Adjustment Date shall be the per acre Ground Rent rate payable by Lessee for
the period immediately prior to the Current Rental Adjustment Date multiplied
by the sum of one hundred percent (100%) plus such percentage change in the
Index; but shall in no event be less than the per acre Ground Rent rate payable
by Lessee for the period immediately prior to the Current Rental Adjustment
Date.  For example, the Adjusted Ground
Rent to be paid by Lessee would be as follows:


	
  New Base Index (last

  	
   

  	
   

  
	
  published before
  the Prior

  	
   

  	
   

  
	
  Rental
  Adjustment Date):

  	
   

  	
  110

  
	
   

  	
   

  	
   

  
	
  Index Last
  Published

  	
   

  	
   

  
	
  Preceding
  Current

  	
   

  	
   

  
	
  Rental
  Adjustment Date:

  	
   

  	
  117

  
	
  % Change in
  Index:

  	
   

  	
   

  	
  6.36%

  



 



 5
 









 


	
  Annual per acre Adjusted
  Ground Rent

  	
   

  	
   

  
	
  for Five (5)
  Year Period Commencing

  	
   

  	
   

  
	
  on the Current
  Rental

  	
   

  	
   

  
	
  Adjustment Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  $3,520 x 106.36%

  	
   

  	
  $3,747.87*

  



*Figures assumed for
purposes of demonstration only.


The Adjusted Rent shall be the Basic Rent payable by the Lessee
starting on the Rental Adjustment Date. 
A notice of the Adjusted Rent shall be sent to the Lessee at least two
(2) weeks prior to the Rental Adjustment Date.


If, during the Demised Term, the Bureau of Labor Statistics shall
discontinue the publication of the Producer Price Index, all commodities,
without issuing appropriate method of adjustment, the Commission shall select a
substitute index.


Section 3.03.          PORT
TARIFF CHARGES.  In addition to the
Basic Rent, Lessee shall pay the Commission (either directly or through an
authorized terminal operator) the tariff charges specified in the most recently
published Port Tariff, Rates, Charges, Rules and Regulations (the “Port Tariff”) a current copy of which is
attached hereto as Exhibit B.  The Commission reserves the unqualified and
unconditional right to interpret, change, amend or revise the Port Tariff and
to supplement, increase or decrease the rates and charges specified
therein.  Lessee covenants that it shall
comply with the Port Tariff in all respects and shall pay all assessments and
charges thereunder as and when due in accordance with the Commission’s billing
procedures and shall provide all documentation as and when reasonably required
by the Commission for the determination of such assessments and charges.


The Port Tariff charges are for Lessee’s use of the harbor, docks,
wharves, appendant facilities, roads, railroad tracks and similar
transportation facilities of the Commission, and Lessee’s customers and/or
suppliers and/or by vehicles and vessels owned or chartered in connection with
the delivery or transportation of materials, goods or products to and from the
Leased Premises.  Notwithstanding the
foregoing, Lessee shall not be required to pay the Port Tariff charges on raw
materials transported to the Leased Premises which are used in ethanol
production.  Lessee’s use of such
facilities is subject to any operators thereof and the Port Tariff.  Lessee shall be responsible for reporting to
the Commission all vehicle and vessel activity and cargos on a weekly basis
(but not later than seven (7) days after vessel departure), with supporting
documentation, manifests, bills-of-lading, etc. 
The Port Director, or another affiliate of the commission, shall have
the right to review and inspect Lessee’s records and books to verify reported
activity at the Port.


The Commission shall then invoice Lessee with thirty (30) day payment
terms.  Any invoices not paid within
thirty (30) days after billing shall be deemed delinquent.  If the reports required herein are not timely
made, the Commission shall have the right to assess Lessee a reasonable fee for
the additional administrative costs of handling such late reports, such fee not
to exceed five percent (5%) of the amount ultimately determined by the
Commission from reviewing such



 6
 









reports to be due from Lessee in excess of the amount determined to be
due from reports previously submitted by Lessee.


Section 3.04.          MINIMUM
GUARANTEED WHARFAGE.


(a)           In addition to the
Basic Rent and the tariff charges provided in Sections 3.02 and 3.03, Lessee
shall pay or cause to be paid to the Commission wharfage payments on no less
than One Hundred Seventy Six Million (176,000,000) gallons of ethanol per year
(equal to 572,280 tons) (the “Minimum
Guaranteed Ethanol Wharfage”) and 548,043 tons of DDG’s per year
(the tons of DDG’s generated from the production of 176 million gallons of
ethanol) (the “Minimum Guaranteed DDG’s
Wharfage”; together with the Minimum Guaranteed Ethanol Wharfage,
the “Minimum Guaranteed Wharfage”).


(b)           The Minimum
Guaranteed Wharfage shall be phased in pursuant to the following schedule:


The Project shall have a two-phased production build
out.  Phase One equals 110 million gallon
annual capacity; Phase Two equals 110 million gallon annual capacity; for a
total Project annual capacity of 220 million gallons of ethanol.  The Phase One 110 million-gallon annual
production of ethanol shall begin (other than for purposes of testing
operations) on or before September 1, 2008. 
The Phase Two production shall commence (other than for purposes of
testing operations) on or before January 1, 2010.  Beginning January 1, 2010 the Project’s
annual production of ethanol shall be 220 million gallons.


The Phase One Minimum Guaranteed Wharfage is 88
million gallons of ethanol per year and the tons of DDG’s generated from the
production of 88 million gallons of Ethanol, which shall commence on the
earlier of (i) the start of ethanol production (other than for purposes of
testing operations) in Phase One or (ii) September 1, 2008. The Phase Two
Minimum Guaranteed Wharfage is on an additional 88 million gallons of ethanol
per year, and the tons of DDG’s generated from the production of an additional
88 million gallons of Ethanol, which shall commence on the earlier of (i) the
start of ethanol production (other than for purposes of testing operations) in
Phase Two or (ii) January 1, 2010.


(c)           Notwithstanding the
rates set forth in the Port Tariff, the wharfage rates for Ethanol, DDG’s and
C02 is as follows:




	
  Ethanol

  	
   

  	
  33 cents per ton

  
	
  DDG’s 

  	
   

  	
  15 cents per ton

  
	
  C02

  	
   

  	
  15 cents per ton (when commercial marketable.)

  






 


Notwithstanding
the rates set forth in the Port Tariff, the wharfage rate for ethanol, DDG’s
and CO2 shall be adjusted on each fifth (5th) anniversary date of the Lease Agreement
using the Index formula for adjusting Ground Rent as stated herein.  Lessee shall pay wharfage on all outbound
product regardless of the mode of transportation used.  Notwithstanding anything else



 7
 









 


to the
contrary set forth in the Port Tariff or this Lease, Lessee shall not pay any
wharfage rate on raw materials delivered to the Leased Premises which are used
in the production of ethanol.


(d)           In the event during any calendar year
the wharfage actually paid or caused to be paid to the Commission by Lessee (“Actual Wharfage”) for ethanol, DDG’s and
C02 received or trans-shipped to and from the Leased Premises over the
Commission’s wharves and docks for such calendar year shall not equal or exceed
the Minimum Guaranteed Wharfage, Lessee shall pay to the Commission within
thirty (30) days of the end of such calendar year and receipt of a bill
therefor from the Commission, as additional rent for the use of the Commission’s
property and the Leased Premises, the positive difference between the Minimum
Guaranteed Wharfage and the Actual Wharfage, with the difference being calculated
based on the a wharfage rate at the then current per ton tariff rate as agreed
to in this Lease.


(e)           In the event the first or last Lease
Year under this Lease does not commence on January 1, or end on December 31,
the Minimum Guaranteed Wharfage Tonnage shall be prorated.  For purposes of this Section 3.04(e), a “Lease Year” (x) with respect to Phase One,
commences on the earlier of (i) the start of ethanol production (other than for
purposes of testing operations) in Phase One or (ii) September 1, 2008, and (y)
with respect to Phase Two, commences on the earlier of (i) the start of ethanol
production (other than for purposes of testing operations) in Phase Two or (ii)
January 1, 2010.  Any amount of wharfage
paid by Lessee over and above the Minimum Guaranteed Wharfage for a calendar
year shall not be credited against the Minimum Guaranteed Wharfage for any
prior or succeeding calendar years.


Section 3.05.          NET
RENT.  Lessee shall pay to the
Commission the Basic Rent, the Minimum Guaranteed Wharfage, Impositions and the
other charges hereunder without any notice, demand, set-off, counterclaim,
abatement or deduction whatsoever, except as may be expressly set forth in this
Lease.  The parties intend that the
obligations of Lessee hereunder shall be covenants and agreements that are
separate and independent from any obligations of the Commission hereunder and
shall continue unaffected unless such obligations have been modified or
terminated in accordance with an express provision of this Lease.


Section 3.06.          DELINQUENT
PAYMENTS AND AUDITS.  The Commission
shall assess a late fee on any delinquent payments due from Lessee to the
Commission under the terms of this Lease at the rate set forth in the Port
Tariff, and if no rate is set forth in the Port Tariff, at the annual rate of
ten percent (10%), per annum.  The
Commission shall also have the right to request an audit by an independent
certified public accountant of Lessee’s Use of the Commission’s
facilities.  If discrepancies are found
to exceed two percent (2%) of the total usage reported in any year, then Lessee
shall pay the amount due and owing as a result of the discrepancy together with
the cost of the audit within thirty (30) days after receipt of a statement
thereof.



 8
 









ARTICLE IV


CONSTRUCTION OF
IMPROVEMENTS


Section 4.01.          LESSEE
IMPROVEMENTS.


(a)           Lessee agrees to
construct a facility (the “Project”)
on the Leased Premises as more fully described on Exhibit C attached hereto. 
Such Project shall be constructed substantially in accordance with the
Plans and Specifications (as defined below) and said construction shall
hereafter be referred to as “Lessee’s Work”.  Throughout the Demised Term, Lessee shall
retain fee simple title to the Improvements now or hereafter located on the
Real Estate.  Upon the expiration or
termination of the Demised Term, title to the Improvements shall vest in
accordance with Article XIV hereof.


(b)           Lessee shall
commence construction of Phase I of the Project on or before April 1, 2007 (the
“Construction Date”).  For purposes hereof, “Commence Construction” means the presence
of contractors on the Leased Premises performing excavation work beyond
clearing of the site after Lessee has obtained all required building
permits.  Lessee shall: (i) cause
substantial completion of Phase One of the Project with a capacity of 110
million gallons of ethanol and the commencement of production of ethanol from
Phase One (other than for the purposes of testing operations) to occur on or
before September 1, 2008, and (ii) to cause substantial completion of Phase Two
of the Project with a capacity of an additional 110 million gallons of ethanol
and the commencement of production of ethanol from Phase Two (other than for
the purposes of testing operations) to occur on or before January 1, 2010.


(c)           Lessee agrees to
prosecute with due diligence all Lessee’s Work. 
The parties acknowledge the Construction Date in Section 4.01(b) above
is established following consultation by Lessee with its construction managers
and suppliers and are reasonable and obtainable.  The parties further acknowledge that there
are external circumstances and conditions, which may arise, through no fault of
Lessee, which will make it impossible for Lessee to comply with such
Construction Date.  Such external
circumstances and conditions, such as the failure of a governmental agency to
issue a required permit following timely application, while not rising to the
level of a Force Majeure Event, as hereafter defined, may extend the time for
compliance by Lessee.  Lessee shall
diligently pursue obtaining permits for Phase One and Phase Two.  In the event Lessee believes it will be
unable to obtain permits by April 1, 2007, but in good faith believes that such
permits may be issued by July 1, 2007, Lessee may postpone until July 1, 2007 such
April 1, 2007 date by written notice of such postponement provided to the
Commission on or before April 1, 2007. 
Lessee may thereafter, but prior to July 1, 2007, give the Commission
written notice of an anticipated failure to comply with the July 1, 2007
date.  Immediately following the written
notice, Lessee and the Commission agree to negotiate in good faith a waiver of
the July 1, 2007 date and the establishment of a new date, which shall be for
the shortest reasonable time period required. 
Failing agreement, either Lessee or the Commission may terminate this
Lease.


Section 4.02.          ALTERATIONS
AND ADDITIONS.  Lessee shall be
entitled to make modifications to the Project provided the modifications do not
expand the physical scope or size of the Project or alter the physical
infrastructure (“Minor Modifications”).  Lessee shall not be



 9
 









entitled to make modifications that would expand the physical scope or
size of the Project or alter the physical infrastructure, without the prior
written consent of the Commission, which consent will not be unreasonably
withheld (“Major Modifications”).  All Minor Modifications and Major
Modifications undertaken by the Lessee shall be made in accordance with this
Article.  Any modifications, Minor and
Major, shall also be referred to herein as “Lessee’s Work”. 
During the Demised Term, the Project and all other Lessee’s Work shall
be the property of Lessee.


Section 4.03.          ASSURANCE
OF PAYMENT AND PERFORMANCE.  Lessee
shall promptly pay all expenses, costs and charges of every kind and nature
arising out of Lessee’s Work, as the same become due and payable.


Section 4.04.          COMPLIANCE
WITH LAWS.  The Project or any other
Lessee’s Work, when completed in accordance with the Plans and Specifications
will not violate or conflict with any applicable law, statute, ordinance, rule,
regulation or order of any kind, including, without limitation, Federal and
State Homeland Security laws and regulations, aviation, zoning, building,
environmental, land use, noise abatement, occupational health and safety or
other laws, any building permit or any condition, grant, easement, covenant,
condition or restriction, whether recorded or not, and in accordance with all
rules and regulations promulgated by the Commission.  In addition, Lessee shall comply with the
provisions of the Declaration of Restrictions attached hereto as Exhibit D and hereby made a part hereof
(the “Declaration”) binding upon a
lessee of the Leased Premises.  The
Declaration may be amended by the Commission from time to time and it is the
duty of the Lessee to examine the most recent Declaration as found in the
Commission’s office.


Lessee shall
indemnify and hold the Commission harmless from and against any and all costs,
expenses, liability, claims, actions and causes of action actually incurred by
the Commission and arising out of Lessee’s violation of any legal requirements.


At its sole cost and expense, Lessee may contest in good faith the
validity in whole or in part of any of the foregoing legal requirements or the
application thereof to the Project or Lessee. 
Promptly upon request, but subject to the Commission’s normal approval
process, the Commission shall execute and deliver any documents that are
reasonably requested by Lessee and required to be signed by the Commission to
permit Lessee to conduct any such contest and shall cooperate with Lessee  in conducting such contest, and Lessee shall
reimburse all third-party costs incurred by the Commission.  To the extent permitted by law Lessee may
defer compliance with the legal requirement or requirements being contested,
provided that the contest proceeding prevents enforcement of the legal
requirement/s being contested or will not subject the Commission to any
criminal penalty or to any material fine or liability, and provided that if an
Event of Default is continuing Lessee shall provide to the Commission
reasonable security.  When any such
contest is concluded and such legal requirement/s are complied with to the
extent required, any security so deposited 
shall be promptly returned to Lessee.


Section 4.05.          PLANS
AND SPECIFICATIONS.  The plans and
specifications for the Project and any Major Modifications shall be reviewed
and approved in writing by the Port Engineer, prior to commencing any of Lessee’s
Work (once approved, the “Plans and
Specifications”).  Approval of
the Plans and Specifications shall not be unreasonably withheld conditioned or



 10
 









delayed.  Review and approval of
the Plans and Specifications shall be for the sole benefit of the Commission,
and the Commission makes no representations or warranties as to the suitability
or soundness of the Plans and Specifications or of any aspect of the Lessee’s
Work.  The location of all utilities,
including electric, telephone, gas and water, as they enter upon the Leased Premises,
will be included in said Plans and Specifications for approval in order that
the master plan layout for such items on the Port site will not be violated or
jeopardized.


Within twenty (20) business days after delivery of Plans and
Specifications to the Port Engineer, the Port Engineer shall either approve the
Plans and Specifications or shall advise Lessee in writing of any modifications
which, in the Port Engineer’s reasonable opinion, are necessary for compliance
with the regulations promulgated by the Commission and the Declaration (as
defined above).  Lessee shall thereafter
make appropriate modifications to the Plans and Specifications.  When tendered to the Port Engineer, the Plans
and Specifications shall be complete in all material respects, containing all
detail requisite for the Lessee’s Work, which, when built and equipped in
accordance therewith, shall be ready for the intended use thereof.  Lessee shall not make any changes in the
Plans and Specifications after they have been approved by the Port Engineer,
without the prior written consent of the Port Engineer, which shall not be
unreasonably withheld.


Lessee, at its sole cost, shall obtain all permits, licenses and
approvals necessary for Lessee’s Work, which permits shall be delivered to the
Port Engineer at least five (5) days prior to the commencement of
construction.  When tendered to the Port
Engineer, the Plans and Specifications shall be complete in all material
respects, containing all detail reasonably required for the Major Modifications
which, when built in accordance therewith, shall be ready for the intended use
thereof.  Lessee shall not make any
material changes in the Plans and Specifications after they have been approved
by the Port Engineer, without the prior written consent of the Port Engineer,
which consent shall not be unreasonably withheld, conditioned or delayed.


Section 4.06.          MECHANIC’S
LIENS.  Lessee shall keep the Leased
Premises, including all Lessee’s Work and improvements located thereon, free
and clear of any and all mechanic’s, materialmen’s and other liens for or
arising out of or in connection with work or labor done, services performed, or
materials or appliances used or furnished for or in connection with any
operations of Lessee, any alteration, improvement, or repairs or additions
which Lessee may make or permit or cause to be made, or any work or
construction, by, for, or permitted by Lessee on or about the Leased Premises,
or any obligations of any kind incurred by Lessee.  Except as otherwise expressly provided for
herein, Lessee shall promptly and fully pay and discharge or bond over any and
all claims against Lessee on which any such lien is or could be based and
indemnify and hold harmless the Commission and the Leased Premises and all
buildings and improvements located thereon against all such liens and claims of
liens and suits or other proceedings pertaining thereto.


If Lessee
desires to contest any such lien, it shall notify the Commission of its
intention to do so within thirty (30) days after Lessee’s receipt of notice of
the filing of such lien and shall commence to contest such lien within the same
time period, and diligently pursue such contest thereafter.  In such case, and provided that enforcement
of such lien against the Leased Premises is stayed pending the conclusion of
such contest, Lessee shall not be in default under this Lease until thirty (30)
days after the final determination of the validity thereof by the court or
other



 11
 









tribunal
having proper jurisdiction of the same, within which time Lessee shall satisfy
and discharge such lien to the extent held valid, but the satisfaction,
discharge or bonding of any such lien shall not, in any case, be delayed if
enforcement of the lien is not stayed pending the conclusion of such contest.


Lessee shall
give the Commission written notice no less than ten (10) days in advance of the
commencement of any substantial construction, alteration, addition or
improvement to the Leased Premises in order that the Commission may post
appropriate notices of the Commission’s non-responsibility in connection
therewith.


Section 4.07.          NO
LIENS ON FEE.  The Commission’s
interest in the Leased Premises shall not be subjected to liens of any nature
by reason of Lessee’s construction, alteration, repair, restoration, replacement
or reconstruction of any Improvements on the Leased Premises, or by reason of
any other act or omission of Lessee (or of any person claiming by, through or
under Lessee) including, but not limited to, mechanics’ and materialmen’s
liens.  All persons dealing with Lessee
are hereby placed on notice that such persons shall not look to the Commission
or to the Commission’s credit or assets (including the Commission’s interest
in  the Improvements constructed thereon
or furnishings contained therein) for payment or satisfaction of any
obligations incurred in connection with the construction, alteration, repair,
restoration, replacement, reconstruction or financing thereof by or on behalf
of Lessee.  Lessee has no power, right or
authority to subject the Commission’s interest in the Leased Premises to any
mechanic’s lien or claim of lien.


Section 4.08.          CONDITION
OF LEASED PREMISES.  Lessee’s Work
and all other work performed by or on behalf of Lessee at the Leased Premises
shall be at the sole risk of Lessee, including any and all loss arising or
resulting from the condition of the Leased Premises.  Lessee understands that the Commission has
made no representations concerning the condition of the Real Estate or its
suitability for construction of the Project or for any use or purpose
whatsoever and that the execution of this Lease is based solely upon Lessee’s
inspection of the Real Estate.


Section 4.09.          FAILURE
TO COMPLETE PROJECT.  In the event
Lessee fails to meet its obligations under this Article, the Commission shall
be entitled to any remedies the Commission has under Article XI hereof.  In addition, the Commission may (but shall
not be obligated to), after providing Lessee sixty (60) days prior written
notice and opportunity to cure (unless Lessee commences within such time to
cure such failure and thereafter diligently prosecutes such cure to
completion), take over and complete construction in accordance with the Plans
and Specifications, with such changes as the Commission may, in its reasonable
discretion, deem appropriate (provided the character and scope of the Project
remains materially unchanged), all at the risk, cost and expense of the
Lessee.  If the Commission elects to
complete the construction of the Project, Lessee shall promptly pay to the
Commission the cost of such completion as reasonably estimated by the
Commission, provided that Lessee shall also be liable to reimburse the
Commission on demand for any reasonable costs incurred in excess of such
estimate.


The Commission may assume or reject any contracts entered into by
Lessee in connection with the Project, and may enter into additional or
different contracts for services, labor and for materials required, in the
reasonable judgment of the Commission, to complete construction, and



 12
 









may pay, compromise and settle all claims in connection therewith.  Upon the Commission’s election to take over
and complete construction, Lessee hereby assigns all of its rights in the
contract with the contractor and any subcontractors or material suppliers it
may have or enter into in the future in completing the Project to the
Commission, and all its rights in the Plans and Specifications and all other
contracts in connection with the Project, all subject to any prior assignment
to any Mortgagee, and subject to any consents to such assignment as may be
required from third parties, such assignment or assignments to be accepted and
become effective only in the event the Commission shall proceed with the
remedies afforded herein.  Any contract
entered into by Lessee shall provide that it is assignable to any Mortgagee and
the Commission, or may be terminated by any Mortgagee or the Commission, if a
Mortgagee exercises its rights under its Mortgage or the Commission exercises
it rights under this Section, such rights of the Commission being subject and
subordinate to such rights of a Mortgagee.


Section 4.10.          REPRESENTATIONS,
WARRANTIES AND AGREEMENTS OF LESSEE. 
The Lessee makes the following representations, warranties and
agreements:


(a)           Lessee is a limited liability
company duly formed, validly existing and in good standing under the laws of
the State of Delaware.  Lessee has full
right, power and authority to execute and deliver this Lease.  Lessee shall provide to the Commission,
contemporaneously with the execution hereof, corporate resolutions approving
this Lease and authorizing the signatory hereto to execute this Lease on behalf
of Lessee.  If Lessee is not organized
pursuant to laws of the State of Indiana, it warrants and represents that it is
now duly qualified to do business in the State of Indiana as a foreign limited
liability company and agrees that it will continuously remain so qualified
during the Demised Term.


(b)           Neither the
execution and delivery of this Lease, nor the consummation of the transactions
contemplated hereby, nor compliance with the terms, conditions and provisions
hereof will conflict with or result in a breach of any law or any regulation,
order, writ, injunction or decree of any court or governmental instrumentality
or agency or any agreement or instrument to which Lessee or any guarantor is a
party or by which it or its property are subject or bound, or constitute a
default thereunder or result in the creation or imposition of any lien, charge,
security interest or encumbrance of any nature whatsoever upon any of the
property of Lessee pursuant to the terms of any such agreement or instrument.


(c)           The execution and
delivery of this Lease has been duly authorized by all necessary action on the
part of Lessee, and no authorization, approval or consent by, or from, any
governmental or public regulatory authority is necessary.  This Lease has been duly and validly executed
and delivered by Lessee and constitutes a legal, valid and binding obligation
of Lessee, enforceable in accordance with its terms.  Guarantors’ financial statements delivered to
the Commission prior to the execution and delivery of this Lease fairly present
their respective financial condition as of the date thereof.  Since the dates of such financial statements,
there has been no material adverse change in the assets, liabilities or
financial condition of guarantors as reflected therein.  Neither Lessee nor guarantor has admitted or
failed to disclose a fact or contingency that would materially adversely affect
the consolidated financial position of guarantor reflected in such financial
statements.


 



 13















(d)           There are no
actions, suits, proceedings, investigations or inquiries pending, or to the
knowledge of Lessee or any of the guarantors, threatened, against or affecting
Lessee or any of the guarantors before any court or governmental
instrumentality or agency, the result of which might have a material adverse
effect on Lessee or its operations or consolidated financial condition, or on
the operation of the Leased Premises or the financial condition of any of the
guarantors.


(e)           During the Demised
Term, and within ninety (90) days after the close of each fiscal year, Lessee
shall furnish the Commission the current annual consolidated audited financial
statements of guarantor filed with the U.S. Securities and Exchange Commission
on Form 10-K.  In addition, during the
Demised Term, and within forty-five (45) days after the close of each fiscal
quarter, Lessee shall furnish the Commission current quarterly financial
statements of guarantor filed with the U.S. Securities and Exchange Commission
on Form 10-Q.


(f)            Lessee shall
promptly give the Commission written notice of all litigation, actions, suits
or proceedings, investigations or inquiries before any court or governmental
authority affecting Lessee, the Leased Premises or a guarantor which, if
determined adversely to Lessee, would have a material adverse effect on the
consolidated financial condition of any of the guarantors or on the
consolidated financial condition or operations of Lessee or its ability to
perform any of its obligations under the Lease.


(g)           Lessee shall provide
to the Commission, contemporaneously with the execution hereof, an opinion of
counsel to Lessee as to those matters reasonably requested by the Commission.


ARTICLE V


USE AND
MAINTENANCE


Section 5.01.          BUSINESS
USE.  The Leased Premises shall be
used and occupied by Lessee only for the operation of an ethanol production
facility, including the production, storage and shipment (by truck, railroad,
barge, pipeline and other means of transportation) of ethanol and ethanol
related products and by products, and for related offices, storage tanks,
storage facilities and other facilities incidental to such activity, in
accordance with the description set forth on Exhibit F (the “Permitted
Uses”).  Lessee shall comply
with all laws, orders, rules and regulations in carrying out such Permitted
Uses.  The Leased Premises may not be
used for any other purpose without the Commission’s prior written consent,
which consent may be withheld in the Commission’s sole discretion.  If Lessee shall materially alter its method
of producing ethanol from that described in Exhibit F, Lessee shall notify the Commission prior to
such modification and the Commission may impose reasonable conditions on the
use of the Leased Premises for such alternate method.  Lessee shall not abandon the Leased Premises
at any time during the Demised Term.  If
Lessee shall abandon or surrender the Leased Premises, or be dispossessed by
process of law, or otherwise, any personal property belonging to Lessee and
left on the Leased Premises for more than ninety (90) days shall be deemed to
be abandoned, at the option of the Commission. 
Lessee covenants and agrees that it will use, maintain and occupy the
Leased Premises in a careful, safe and lawful manner.



 14
 









Section 5.02.          MAINTENANCE
OF LEASED PREMISES.  Lessee shall, at
its sole cost and expense, keep the Leased Premises, including, but not limited
to, the entire interior and exterior of all improvements at any time located
thereon, all structural components and mechanical systems, the parking areas,
landscaped areas, lawns, and all other portions of the Leased Premises in good
condition and repair and in good operating condition and in a clean and sightly
condition.  The Commission shall have no
repair or maintenance obligations concerning the Leased Premises.


Section 5.03.          UTILITY
CHARGES.  Lessee agrees to pay all
charges for sewer, trash removal, water, gas, electricity, telephone and all
other utility services used upon the Leased Premises throughout the Demised
Term, including any and all tap-in fees and all costs and expenses incurred in
extending any utility service to the Leased Premises from the point provided by
the utility company, and to indemnify and hold the Commission harmless from any
and all liability resulting from any non-payment for any such services.  Lessee shall abide by all requirements of any
utility providing service to Lessee, and Lessee shall indemnify and hold the
Commission harmless from any and all liability, cost and expense (including
reasonable attorneys’ fees) incurred by the Commission as a result of Lessee’s
use of any utilities.


ARTICLE VI


PAYMENT OF TAXES
AND ASSESSMENTS


Section 6.01.          IMPOSITIONS.  Lessee shall pay or cause to be paid, all
real property taxes, personal property taxes and other taxes, assessments,
including any assessments and other charges provided for in the Declaration;
water and sewer charges, levies, license and permit fees and other governmental
charges of any kind and nature whatsoever, which at any time during the Demised
Term may be assessed, levied, or become due and payable, or become a lien on,
the Leased Premises, Lessee’s leasehold interest therein, improvements or any
appurtenance thereon; all of which are collectively referred to herein as “Impositions”.  All such payments shall be made before any
fine, penalty, interest or cost may be added for non-payment.


Upon written
request, Lessee shall furnish the Commission reasonable evidence of payment of
all such Impositions.


Section 6.02.          LESSEE
CONTESTING IMPOSITIONS.  Lessee shall,
for tax purposes, have the right to seek a reduction in the valuation of the
Leased Premises or its interest therein, including any real or personal
property located on the Leased Premises. 
At its sole cost and expense, Lessee, may contest in good faith the
amount or validity in whole or in part of any Imposition.  Promptly upon request but subject to the
Commission’s normal approval process, the Commission shall execute and deliver
any documents that are reasonably requested by Lessee and required to be signed
by the Commission to permit Lessee to conduct any such contest and shall
cooperate with Lessee  in conducting such
contest, and Lessee shall reimburse all third-party costs incurred by the
Commission.  To the extent permitted by
law, Lessee may defer payment thereof, provided that such contest prevents the
collection of item or items being contested, and provided that if an Event of
Default is continuing Lessee shall provide to the Commission reasonable
security in the amount of the item or items so contested, plus from time



 15
 









to time such additional amounts as may be reasonably required to cover
interest or penalties accrued or to accrue on any such item or items.


The Commission
may, on thirty (30) days written notice to Lessee, require Lessee to pay such
contested item or items or may pay such items out of the security provided to
the Commission if, in the Commission’s reasonable determination, there is undue
delay by Lessee in the prosecution of such proceedings, or if, in the
reasonable determination of the Commission, protection of the Leased Premises
or of the Commission’s interests therein shall require such payment.  When any such contested items shall have been
paid or canceled, any security so deposited to cover them and not applied by
the Commission as a payment, shall be promptly returned to Lessee.


ARTICLE VII



ASSIGNMENT AND SUBLETTING


Section 7.01.          ASSIGNMENT,
SUBLETTING AND MORTGAGING.  Lessee
may not assign this Lease or sublet all or any portion of the Leased Premises
without the prior written approval of the Commission, which approval shall not
be unreasonably withheld.  In granting
such approval consent in this Section 7.01 and Section 7.02 below, the
Commission shall be entitled to consider, among other items, the proposed
assignee’s financial condition, business reputation, nature of the proposed
assignees business, and such other factors as may reasonably bear upon the
suitability of the assignee as a lessee of the Leased Premises and a tenant at
the Port.  No such approval shall be
required for any assignment or sublease to any Affiliate.  Except as permitted under Section 7.02
hereunder, Lessee may not grant a security interest in, pledge or mortgage its
Leasehold Estate, without the prior written approval of the Commission, which
approval may be granted or withheld in the sole and absolute discretion of the
Commission.


As
herein, unless otherwise specified, the following terms have the following
meanings:


“Affiliate”
means, with respect to any person, any other person directly or indirectly
controlling, controlled by or under common control with such person.


“person”
means any natural person, corporation, limited liability company, partnership,
joint venture, association, trust or other entity or organization, including a
government or political subdivision, agency or instrumentality thereof.


“control”
and variations thereof means ownership, directly or indirectly, of more than
50% of the voting securities of or interests in a person.


Section 7.02.          MORTGAGEE
PROTECTIONS.  Notwithstanding
anything in this Lease to the contrary:


(a)           Provided that any
Mortgagee or Lessee provides the Commission with a copy of an executed, or
conformed copy, of a Mortgage which contains the name and address of the
Mortgagee, the Commission hereby covenants and agrees to faithfully perform and
comply with the following provisions with respect to such Mortgage (“Mortgage” and “Mortgagee” mean a mortgage or a mortgagee satisfying the
provisions of this Section 7.02):



 16
 









(b)           Acknowledgement
of Notice.  Upon receipt of a
Mortgage as set forth above, the Commission shall provide a written
acknowledgment to such Mortgagee.  Such
notice from Mortgagee shall not be deemed effective until Lessee or Mortgagee
receives confirmation of delivery of such notice as described in Section 16.01
or the Commission has provided written acknowledgement of such delivery
pursuant to said Sections.


(c)           No Modification
or Lease Impairment.  No action by
Lessee or the Commission to cancel, surrender, or materially modify the terms
of this Lease or the provisions of this Section 7.02 or any other Lease
Impairment shall be binding upon Mortgagee without its prior written consent.


(d)           Notices.  If the Commission shall give any notice,
demand, election or other communication which may adversely affect the security
for a Mortgage, including without limitation a notice of a default or an Event
of Default hereunder (hereinafter collectively “Notices”), to Lessee hereunder, the Commission shall
simultaneously give a copy of each such Notice to the Mortgagee at the address
theretofore designated by it.  No Notice
given by the Commission to Lessee shall be binding upon or affect said
Mortgagee unless a copy of said Notice shall be given to Mortgagee pursuant to
this Section.  In the case of an assignment
of such Mortgage or change in address of such Mortgagee, said assignee or
Mortgagee, by written notice to The Commission, may change the address to which
such copies of Notices are to be sent. 
The Commission shall not be bound to recognize any assignment of such
Mortgage unless and until the Commission shall be given written notice thereof,
a copy of the executed assignment, and the name and address of the assignee;
and such notice shall not be effective until the person giving such notice
receives confirmation of delivery of such notice as described in Section 16.01
or the Commission has provided written acknowledgement of such delivery
pursuant to said Section.  Thereafter,
such assignee shall be deemed to be the Mortgagee hereunder with respect to the
Mortgage being assigned.  If such
Mortgage is held by more than one person, corporation or other entity, no
provision of this Lease requiring the Commission to give Notices or copies
thereof to said Mortgagee shall be binding upon the Commission with respect to
such Mortgage unless and until all of said holders shall designate in writing
one of their number to receive all such Notices and copies thereof and shall
have given to the Commission a copy of an executed, or conformed copy, of  such designation.


(e)           Performance of
Covenants.  The Mortgagee shall have
the right to perform any term, covenant or condition and to remedy any default
or Event of Default by Lessee hereunder within the time periods specified
herein, and the Commission shall accept such performance with the same force
and effect as if furnished by Lessee; provided, however, that said Mortgagee
shall not thereby or hereby be subrogated to the rights of the Commission.


(f)            Delegation to
Mortgagee.  Lessee may delegate
irrevocably to the Mortgagee the exclusive or non-exclusive authority to
exercise any or all of Lessee’s rights hereunder, but no such delegation shall
be binding upon the Commission unless and until either Lessee or the Mortgagee
shall give to the Commission a true copy of the Mortgage (with the relevant
provisions noted in such notice or on such copy of the Mortgage) or other
written instrument effecting such delegation; and such notice shall not be
effective until the person giving such notice receives confirmation of delivery
of such notice described in Section 16.01 or the Commission has provided
written acknowledgement of such delivery pursuant to said Section.



 17
 









(g)           Default by Lessee.  In the event of an Event of Default by Lessee
in the payment of any monetary obligation hereunder, the Commission agrees not
to exercise its remedies hereunder unless and until the Commission provides
written notice of such Event of Default to any Mortgagee and such Mortgagee, or
the Lessee, shall have failed to cure such Event of Default within thirty (30)
business days following receipt of such notice and the expiration of any grace
or cure periods granted to Lessee herein. 
In the event of an Event of Default by Lessee in the performance or
observance of any non-monetary term, covenant, or condition to be performed by
it hereunder, the Commission agrees not to exercise its remedies hereunder
unless and until the Commission provides written notice of such Event of
Default to any Mortgagee and such Mortgagee, or the Lessee, shall have failed to
cure such Event of Default within sixty (60) days following receipt of such
notice  and the expiration of any grace
or cure periods granted Lessee herein; provided, however, (x) if such Event of
Default cannot practicably be cured by Mortgagee within such sixty (60) day
period, (y) if such Event of Default cannot practicably be cured by Mortgagee
without taking possession of the Leased Premises or Foreclosure, or (z) if
Mortgagee is stayed, enjoined or otherwise prevented from curing such Event of
Default, taking possession of the Leased Premises or Foreclosing, then the
Commission shall not exercise its remedies hereunder if and so long as:


(i)                                     In
the case of an Event of Default which cannot practicably be cured by the
Mortgagee within such sixty (60) day period, Mortgagee shall have delivered to
the Commission, prior to the expiration of such sixty (60) day period, a
written notice wherein Mortgagee states that it intends to cure such Event of
Default and, thereafter, shall proceed diligently to cure such Event of
Default.


(ii)                                  In
the case of an Event of Default which cannot practicably be cured by the
Mortgagee without taking possession of the Leased Premises or Foreclosure,
Mortgagee shall have delivered to the Commission, prior to the expiration of
such sixty (60) day period, a written notice wherein Mortgagee states that it
intends to obtain possession of the Leased Premises or Foreclose and cure such
Event of Default and, thereafter, shall proceed diligently to obtain possession
of the Leased Premises (including possession by receiver) or Foreclose and,
upon obtaining such possession or Foreclosing, shall proceed diligently to cure
such Event of Default.


(iii)                               In
the case of a Lessee-Specific Event of Default, Mortgagee shall institute
Foreclosure and diligently prosecute the same to completion (unless in the
meantime it shall acquire Lessee’s Leasehold Estate by assignment, deed or
other transfer in lieu of Foreclosure) and, upon such completion of Foreclosure
or such acquisition, such Tenant-Specific Event of Default shall be deemed to
have no further effect and no longer to be an Event of Default.


If Mortgagee
is stayed or enjoined form taking any action under (i), (ii) or (iii) above,
Mortgagee’s time to take such action shall be extended by the length of time
that such stay or injunction remains in effect, so long as Mortgagee pursues
normal and customary steps to terminate such stay or injunction, and,
thereafter, Mortgagee shall have a reasonable time to take such action.  Mortgagee shall not be required to continue
any action under (i), (ii) or (iii) above. 
However, if Mortgagee terminates or fails to prosecute diligently any
action under (i), (ii) or (iii) 



 18
 









above, then,
upon not less than thirty(30) days prior written notice to Lessee, the Commission
may exercise its remedies with respect to the Event of Default in question,
unless Mortgagee shall thereafter proceed diligently with such action under
(i), (ii) or (iii) above.  Mortgagee
shall not be required to continue any action under (i), (ii) or (iii) above if
and when the Event of Default in question shall be cured.  Nothing herein shall preclude the Commission
from exercising any of its rights or remedies with respect to any other Event
of Default by Lessee during any period of such forbearance, but in such Event
of Default Mortgagee shall have all of its rights provided for herein.  If the Mortgagee, its Affiliate or a
Qualified Operator, shall acquire title to Lessee’s Leasehold Estate hereunder
and shall cure all Events of Default other than Lessee-Specific Events of
Default, then all prior Lessee-Specific Events of Default shall be deemed to
have no further effect and no longer to be Events of Default.


(h)           Foreclosure.  Foreclosure of any Mortgage shall not require
the consent of the Commission or constitute a breach of or default under any
provision of this Lease; and, upon completion of Foreclosure, the Commission
shall recognize Mortgagee, its Affiliate or a Qualified Operator as the new
Lessee hereunder without the necessity of obtaining the Commission’s consent to
such transfer pursuant to Section 7.01, and such new Lessee shall thereafter
have the right to further transfer the Leasehold Estate to a Qualified
Operator.  Upon the acquisition of the
Leasehold Estate by Mortgagee, its Affiliate or a Qualified Operator by
Foreclosure, upon written request by such New Lessee given not later than
ninety (90) days after acquisition of the Leasehold Estate by such New Lessee,
the Commission shall promptly (but not later than ninety (90) days after its
receipt of such request) execute and deliver a New Lease to such New Lessee,
provided that the Commission receives reasonably satisfactory evidence that
Lessee no longer has any rights in and to the Leasehold Estate and/or this
Lease.


(i)            New Lease.  The Commission agrees that in the event of any
termination of this Lease by reason of the disaffirmance hereof by a receiver,
liquidator or trustee for Lessee or its property, Mortgagee may by written
notice given to the Commission within sixty (60) days after such termination
require the Commission to promptly (but not later than ninety (90) days after
its receipt of such request) enter into a New Lease with a New Lessee.  The Commission need not do so, however, unless
and until New Lessee has (i) cured all Events of Default (except
Lessee-Specific Events of Default), and (ii) reimbursed the Commission’s
out-of-pocket costs (including reasonable attorneys’ fees and expenses) to
terminate this Lease, recover the Leased Premises and enter into the New Lease.  If more than one Mortgagee requests a New
Lease, the Commission shall enter into the New Lease with the most-senior
Mortgagee (as determined pursuant to clause (n) below) requesting such New
Lease, upon compliance by such most-senior Mortgagee with the conditions for
such New Lease.  The New Lessee under the
New Lease shall have the same right, title and interest in and to all
Improvements and Equipment located on the Leased Premises as Lessee had under
the terminated Lease immediately prior to its termination, and the Commission
shall cause any Fee Mortgagees to confirm the subordination of their Fee
Mortgages to the New Lease.


(j)            Personal
Liability.  In the event any
Mortgagee, its Affiliate or a Qualified Operator becomes Lessee under this
Lease or New Lessee under a New Lease, such Mortgagee, Affiliate or Qualified
Operator shall be liable for the obligations of Lessee under this Lease or New
Lessee under such New Lease from and after the date it becomes Lessee or New
Lessee for so long as it remains Lessee or New Lessee, provided, any Mortgagee’s
liability shall be limited



 19
 









to its interest in the Leasehold Estate under this Lease or the New
Lease, as the case may be, and such liability shall terminate if and when it
assigns or otherwise transfers the Leasehold Estate under this Lease or the New
Lease, as the case may be, to another person.


(k)           Reimbursement.  As a condition to the Commission’s acceptance
of the cure of an Event of Default or issuance of a New Lease, Mortgagee (or
its Affiliate or New Lessee) shall reimburse the Commission for all out- with
of-pocket costs, including reasonable attorneys’ fees, incurred by the
Commission in connection its obligations under this Section 7.02 with respect
thereto.


(l)            Lessee’s
Leasehold Rights.  Notwithstanding
anything to the contrary herein, so long as Mortgagee’s time to obtain a New
Lease has not expired, it may exercise Lessee’s rights (including Preemptive
Rights) under this Lease, even if a default or Event of Default exists.  Lessee irrevocably assigns to Mortgagee: (i)
to the exclusion of Lessee and any other person, any right to exercise any
Bankruptcy Termination Option; and (ii) any right of Lessee to object to any
Bankruptcy Sale by the Commission.


(m)          Certain
Proceedings.  If the Commission or Lessee
initiates any appraisal, arbitration, litigation or other dispute resolution
proceeding affecting this Lease, then the parties shall simultaneously notify
Mortgagee. Mortgagee may participate in such proceedings on Lessee’s behalf, or
exercise any or all of Lessee’s rights in such proceedings, in each case (at
Mortgagee’s Option) to the exclusion of Lessee. 
No settlement shall be effective without Mortgagee’s consent, unless
Lessee simultaneously pays the settlement, the amount at issue does not exceed
Twenty-Five Thousand Dollars ($25,000), and the claimant has released (or does
not assert) any claim against Mortgagee.


(n)           Multiple
Mortgagees.  If at any time multiple
Mortgagees exist: (i) any consent by or notice to Mortgagee refers to all
Mortgagees; (ii) except under clause (i) the most senior Mortgagee may exercise
all rights of Mortgagee(s), to the exclusion of junior Mortgagee/s; (iii) to
the extent that the most senior Mortgagee declines to do so, any other
Mortgagee may exercise those rights, in order of priority; and (iv) if
Mortgagees do not agree on priorities, a written determination of priority
issued by a title insurance company licensed in the State of Indiana shall
govern.


(o)           Further
Assurances.  Upon request from Lessee
or any Mortgagee (prospective or current), the Commission shall promptly, under
documentation reasonably satisfactory to the requesting party and the
Commission: (i) agree directly with Mortgagee that it may exercise against the
Commission all Mortgagee’s rights in this Lease; and (ii) certify (subject to
any then exception reasonably specified) that to the Commission’s knowledge
this Lease is in full force and effect, that no Lease Impairment has occurred,
that no default or Event of Default exists, the date through which rent and
other charges hereunder have been paid, and other similar matters as reasonably
requested.


(p)           No Merger.  If the Leasehold Estate and the Fee Estate
are ever commonly held, they shall remain separate and distinct estates (and
not merge) without each Mortgagee’s and each fee mortgagee’s consent as long as
any Mortgagee and any fee mortgage remain in effect.



 20
 









(q)           Fee Mortgages.  Every Fee Mortgage shall be, shall state that
it is, and shall be deemed to state that it is, subject and subordinate to this
Lease and any New Lease, and shall attach only to the Fee Estate. A Foreclosure
with respect to a Leasehold Mortgage shall not impair any estate or right under
any Fee Mortgage and shall transfer only the Leasehold Estate.


(r)            Miscellaneous.  Notwithstanding anything to the contrary in
this Lease, Mortgagee may: (i) exercise its rights through an Affiliate, (and
anyone acting under this clause (r) shall have the same rights, protections and
limitations of liability as Mortgagee), provided that any Mortgagee, its
Affiliate or a Qualified Operator shall be entitled to become the new Lessee
hereunder or a New Lessee under a New Lease; (ii) refrain from curing any
default or Event of Default; (iii) abandon such cure at any time; or (iv)
withhold consent or approval for any reason or no reason, except where this
Lease states otherwise. Any such consent or approval must be written. To the
extent any Mortgagee’s rights under this Lease apply after this Lease
terminates, they shall survive such termination.


(s)           Definitions.  As herein, unless otherwise specified, the
following terms have the following meanings:


“Bankruptcy Sale” means a sale of any
property, or any interest in any property, under 11 U.S.C. §363 or otherwise in
any bankruptcy, insolvency, or similar proceeding affecting the owner of such
property.


“Bankruptcy Termination Option” means Lessee’s
right to treat this Lease as terminated under 11 U.S.C. §365(h)(1)(A)(i) or any
comparable provision of law.


“Fee Estate” means the Commission’s fee
interest in the Leased Premises, including the Commission’s reversionary
interest, all subject to this Lease.


“Fee Mortgage” means any mortgage, deed of
trust, collateral assignment or other lien (as modified from time to time)
encumbering the Fee Estate.  A Fee
Mortgage shall not attach to the Leasehold Estate.


“Foreclosure” means any: (i) foreclosure
sale (or trustee’s sale, assignment in lieu of foreclosure, Bankruptcy Sale, or
similar transfer) affecting the Leasehold Estate; (ii) Mortgagee’s exercise of
any other right or remedy under a Leasehold Mortgage (or applicable law) that
divests Lessee of its Leasehold Estate, or (iii) any sale, assignment, deed or
other transfer in or in lieu of (i) or (ii). 
“Foreclose” (and any variation of such term) means to take any
Foreclosure action.


“Lease Impairment” means Lessee’s: (i)
canceling, modifying, restating, surrendering, or terminating this Lease; (ii)
consenting, or failing to object, to a Bankruptcy Sale of any Leased Premises;
(iii) determining that a Total Loss has occurred; (iv) exercising any
Bankruptcy Termination Option; (v) subordinating this Lease or the Leasehold
Estate to any other estate or interest in the Leased Premises; or (vi) waiving
any term(s) of this Lease.


“Leasehold Estate” means Lessee’s leasehold
interest in the Leased Premises under this Lease and the fee interest in the
Improvements located on the Leased Premises.



 21
 









The fee interest in the Improvements located
on the Leased Premises shall be owned by Lessee until the expiration or earlier
termination as provided herein of the Demised Term.


“Lease Termination Notice” means a notice by
the Commission to Mortgagee stating that the Lease has terminated and
describing in reasonable detail any uncured defaults or  Events of Default.


“Lessee-Specific Event of Default” means any
default or Event of Default (i) that arises from any lien or encumbrance
attaching solely to the Leasehold Estate (not the Fee Estate) but junior to the
Leasehold Mortgage; (ii) that Mortgagee or a purchaser in or in lieu of
Foreclosure or New Lessee cannot cure (including without limitation any default
or Event of Default referred to in the following clause (iii); and (iii) that
arise under (1) Section 11.01 (b), (c), (d), (e), (f), (g) or (h), (2) the last
paragraph of Section 11.01, (3) Article XVII, or (4) the Addendum


“Loss” means any Damage or any taking by a
Condemnation Proceeding.


“New Lease” means a new lease of the Leased
Premises and related customary documents such as a memorandum of lease. Any New
Lease shall: (i) commence immediately after this Lease terminated; (ii)
continue for the entire remaining term of this Lease, as if no termination had
occurred, subject to any Preemptive Rights; (iii) give New Lessee the same
rights to Improvements that this Lease gave Lessee; (iv) have the same
terms, including Preemptive Rights, and the same priority, as this Lease,
subject to any subsequent written amendments made with Mortgagee’s consent; and
(v) require New Lessee to cure, with reasonable diligence and continuity,
within a reasonable time, all Events of Default (except Lessee-Specific Events
of Defaults) not otherwise cured or waived.


“New Lessee” means Mortgagee, its Affiliate
or a Qualified Operator.


“Preemptive Right” means any extension right
this Lease gives Lessee.


“Qualified Operator” means an entity that is
approved by the Commission, which approval shall not be unreasonably
withheld.  In granting such approval, the
Commission shall be entitled to consider, among other items, the proposed
entity’s financial condition, business reputation, nature of its business, and
such other factors as may reasonably bear upon the suitability of the entity as
a lessee of the Leased Premises and a tenant at the Port.


ARTICLE VIII


INDEMNIFICATION
AND INSURANCE


Section 8.01.          GENERAL
INDEMNITY.


(a)           Lessee shall
indemnify and hold harmless and defend the Commission, its Commissioners,
officers, employees, agents, successors, transferees and assigns (collectively
referred to in this Section 8.01 as the “Commission”)
from all losses, costs, claims, liabilities,



 22
 









damages and expenses of whatever kind, including reasonable attorneys’
fees, which arise out of or are alleged to arise out of; 1) Lessee’s use and
occupancy of the Leased Premises; 2) any breach or default by Lessee in the performance
of its obligations under this Lease; 3) any activity, work or things done,
permitted or suffered by Lessee in or about the Leased Premises or elsewhere in
the Port, including performance of Lessee’s Work; 4) any act or omission of the
Lessee or any of Lessee’s agents, employees, directors, officers, contractors,
subcontractors, licensees, invitees, successors, assigns, transferees or any
other person on the Leased Premises on behalf of Lessee; 5) or any damage to
the property of or injury to or death of Lessee, its directors, officers,
contractors, subcontractors, licensees, invitees, successors, assigns,
transferees or any other person on the Leased Premises on behalf of Lessee, and
whether based upon, or claimed to be based upon, statutory, contracted, tort or
other liability of the Commission, in whole or in part, or by the negligence of
the Commission, or its breach of contract, breach of warranty, strict liability
or breach of duty (excluding the Commission’s gross negligence or the gross
negligence of the Commission’s officers or employees).


(b)           Lessee, as a
material part of the consideration to the Commission, hereby assumes all risks
of damage to property or injury to persons, in, upon or about the Leased
Premises arising from any cause first occurring during the Demised Term and
Lessee hereby waives all claims in respect thereof against the Commission
(except for the Commission’s gross negligence and the gross negligence of the
Commission’s officers or employees). 
This indemnity includes all, costs, reasonable attorneys’ fees, expenses
and liabilities incurred in the defense of any such claim or any action or
proceeding brought thereon.


(c)           In the case of this
indemnity and each other indemnity by Lessee in this Lease, (i) the Commission
shall give written notice to Lessee promptly upon receiving any notice of any
such indemnified claim; (ii) upon receiving written notice of any such claim
from the Commission, Lessee  shall defend
the Commission with respect to any such claim with counsel selected by Lessee,
subject to the approval of the Commission (unless such counsel is selected by
Lessee’s insurance carrier), which approval shall not be unreasonably withheld,
delayed or conditioned; (iii) Lessee shall control the defense and settlement
of any such claim, provided that Lessee shall not settle any such claim without
the approval of the Commission (unless such settlement is fully covered by
Lessee’s insurance), which approval shall not be unreasonably withheld, delayed
or conditioned.


Section 8.02.          PROPERTY
INSURANCE.


(a)           Throughout the
Demised Term, Lessee shall procure and maintain in full force and effect fire
and extended coverage commercial property insurance written upon the Project
and all buildings and other insurable improvements located upon the Leased
Premises.  Said insurance shall be in an
amount not less than the full replacement cost of the Project and other
buildings and other insurable improvements located upon to the Leased Premises.  Deductibles, if any, included in such insurance
shall be the sole responsibility of Lessee and payments to others shall be
unencumbered by such deductibles.  Lessee
shall also procure and maintain in full force and effect throughout the Demised
Term fire and extended coverage commercial property insurance for the full
insurable value of Lessee’s trade fixtures, furnishings, equipment and all
items of personal property on the Leased Premises.  During the period of any construction,
including construction of the Project, Lessee shall maintain builder’s risk
insurance in an amount



 23
 









sufficient to cover all costs of construction and uninstalled materials
otherwise reasonably acceptable to the Commission.  Such insurance shall include coverage for
earthquake at a sub-limit of $10,000,000.


(b)           Such insurance shall
provide that the insurer shall have no rights of subrogation against either the
Commission or Lessee.  Said insurance
shall be effective not later than the Commencement Date and provide for at
least thirty (30) days written notice to the Commission prior to cancellation
or non-renewal.  On or before the
Commencement Date, Lessee shall provide to the Commission certificates of such
insurance or other proof of such insurance policies evidencing such insurance
is in force.  Appropriate renewal or
replacement insurance conforming to the requirements in (a) above shall be in
force prior to or upon the expiration of any such insurance without any lapse
in coverage.  Such insurance shall be
issued by companies licensed or authorized to provide fire and extended
coverage insurance in the State of Indiana and otherwise reasonably acceptable
to the Commission and having a policyholder rating of not less than “A- VII” in
the then-most current edition of Best’s Insurance Reports; or, if such rating
is changed, the equivalent rating; or, if Best’s Insurance Reports is no longer
published, an equivalent rating in another publication reasonably selected by
the Commission and reasonably satisfactory to Lessee.  Such insurance shall name Mortgagee as loss
payee and shall name the Commission as additional insured.


(c)           If Lessee shall fail
or refuse, for five (5) days after written notice by the Commission to Lessee,
to procure, pay for or keep in force the policies of insurance as set forth
herein (or in Section 8.04 below), or to deliver certificates of insurance or
other proof of such insurance as provided above, the Commission may keep in
force and/or from time to time renew such insurance until compliance by Lessee;
and all sums so expended or expenses so incurred by the Commission under this
section 8.02(c) shall bear interest the Stated Rate per annum; and such sums
and interest shall be treated as additional rent due from Lessee to the
Commission payable within fifteen (15) days after invoice therefore is
delivered to Lessee.


Section 8.03.          LIABILITY
INSURANCE.


(a)           Throughout the
Demised Term, Lessee shall procure and maintain in full force and effect
throughout the Demised Term liability insurance as described below against
claims or suits for bodily injury, including death, or property damage
occurring upon, in or about the Leased Premises.  Such insurance shall name Lessee as insured
and shall name the Commission and such other persons as Lessee may specify as
an additional insureds.


(b)           Such insurance shall
provide that the insurer shall have no rights of subrogation against either the
Commission or Lessee.  Said insurance
shall be effective not later than the Commencement Date and provide for at
least thirty (30) days written notice to the Commission prior to cancellation
or non-renewal.  On or before the
Commencement Date, Lessee shall provide to the Commission certificates of such
insurance or other proof of such insurance policies evidencing such insurance
is in force.  Appropriate renewal or
replacement insurance conforming to the requirements in (a) above shall be in
force prior to or upon the expiration of any such insurance without any lapse
in coverage.  Such insurance shall be
issued by companies licensed or authorized to provide liability insurance in
the State of Indiana and otherwise reasonably acceptable to the Commission and
having a policyholder rating of not less than “A-



 24
 









VII” in the then-most current edition of Best’s Insurance Reports; or,
if such rating is changed, the equivalent rating; or, if Best’s Insurance
Reports is no longer published, an equivalent rating in another publication
reasonably selected by the Commission and reasonably satisfactory to Lessee.


(c)           If Lessee shall fail
or refuse, for five (5) days after written notice by the Commission to Lessee,
to procure, pay for or keep in force the policies of insurance as set forth
herein (or in Section 8.04 below), or to deliver certificates of insurance or
other proof of such insurance as provided above, the Commission may keep in
force and/or from time to time renew such insurance until compliance by Lessee;
and all sums so expended or expenses so incurred by the Commission under this
section 8.02(c) shall bear interest at the Stated Rate per annum; and such sums
and interest shall be treated as additional rent due from Lessee to the
Commission payable within fifteen (15) days after invoice therefore is
delivered to Lessee.


(d)           Lessee agrees to
carry liability insurance providing coverage for the liabilities set forth in
this Article as follows, at its sole expense:


(i)                                     Commercial
general liability insurance against claims or suits for bodily injury to,
including death of, persons or damage to, including loss of use of, property
occurring on or about the Leased Premises with minimum limits of liability of
Five Million Dollars ($5,000,000) combined single limit for each
occurrence.  Deductibles, if any,
included in such insurance shall be the sole responsibility of Lessee and
payments to others shall be unencumbered by such deductibles.  Such insurance shall include but not be
limited to bodily injury liability, personal injury liability, property damage
liability, broad form property damage liability, contractual liability, and
products/completed operations liability.


(ii)                                  Commercial
automobile liability insurance against claims for injury to, including death
of, persons or damage to property occurring in or about the Leased Premises
with minimum limits of liability of Five Million Dollars ($5,000,000) combined
single limit for each accident.  Deductibles,
if any, included in such insurance shall be the sole responsibility of Lessee
and payments to others shall be unencumbered by such deductibles.  Such insurance shall include but not be
limited to bodily injury liability, personal injury liability, property damage
liability, hired car liability, and nonowned auto liability.


(iii)                               Workers
compensation insurance as required by the laws of the State of Indiana, and as
applicable, all appropriate Federal Acts such as, but not limited to the U.S.
Longshoremen and Harborworkers Compensation Act, the Jones Act, and the Federal
Employers Liability Act.  The limit of
liability under employer’s liability shall not be less then Five Million
Dollars ($5,000,000) for each accident.


(iv)                              Pollution
Legal Liability insurance to include pollution clean-up, bodily injury and
property damage, on or off the Leased Premises, with a minimum limit of
liability of $1,000,000 for each occurrence.



 25
 









Lessee may, at its option, purchase a
combination of primary insurance, including commercial general liability
insurance, commercial automobile liability insurance and employers liability
insurance, and umbrella or excess liability insurance that when combined
together meet the Five Million Dollars ($5,000,000) each occurrence/accident
requirement herein.  Such umbrella or
excess liability insurance shall be issued by companies licensed or authorized
to provide liability insurance in the State of Indiana and otherwise reasonably
acceptable to the Commission  and the
insurance carrier and having a policyholder rating of not less than “A- VII” in
the then-most current edition of Best’s Insurance Reports; or, if such rating
is changed, the equivalent rating; or, if Best’s Insurance Reports is no longer
published, an equivalent rating in another publication reasonably selected by
the Commission and reasonably satisfactory to Lessee.


Section 8.04.          BLANKET
COVERAGE.  Notwithstanding anything
to the contrary contained in this Article, Lessee’s obligations to carry the
insurance provided for herein may be brought within the coverage of a so-called
blanket policy or policies of insurance carried and maintained by Lessee;
provided, however, that the coverage afforded the Commission will not be
reduced, diminished or otherwise be different from that which would exist under
a separate policy meeting all other requirements of this Lease by reason of the
use of such blanket policy of insurance, and provided further that the
requirements of this Article are otherwise satisfied.  Such blanket policy shall contain an
endorsement that names the Commission as an additional insured, references the
Leased Premises and guarantees a minimum limit available for the Leased
Premises equal to the insurance amounts required in this Lease.


Section 8.05.          RIGHTS
UPON TERMINATION.  If this Lease is
forfeited or terminated by Lessee for any reason, then all policies of
insurance and all insurance proceeds shall remain the property of Lessee.  Lessee will at the request and expense of the
Commission cooperate with the Commission to seek to have such policies of
insurance assigned to the Commission, however, such policies may not be
assigned by Lessee without the prior written consent of the insurance carrier.


Section 8.06.          WAIVER
OF LIABILITY/SUBROGATION.


(a)           Lessee hereby waives
any and all rights of recovery against the Commission, and against the
Commissioners, officers, employees, agents and representatives of the
Commission, for loss of or damage to Lessee or its property or the property of
others under Lessee’s control.  Lessee
shall, upon obtaining policies of property insurance insuring its property,
including the property insurance required hereunder, give notice to the
insurance carrier or carriers of the foregoing waiver of subrogation as
contained in this Lease and such waiver of subrogation shall be noted on all
such insurance policies and in certificates of insurance which Lessee shall
deliver to the Commission.


(b)           The Commission
hereby waives any and all rights of recovery against the Lessee, or against the
officers, employees, agents and representatives of the Lessee for loss of or
damage to the Commission or its property or the property of others under the
Commission’s control if such loss or damage is insured against under any
insurance policy maintained by the Commission in force at the time of such
loss.


 



 26















Section 8.07.          COMPLIANCE.  Lessee shall comply with all reasonable
requirements of the insurance companies the providing the Leased Premises.


ARTICLE IX



DAMAGE BY CASUALTY


Section 9.01.          REPAIR
OR RESTORATION.  Except as provided
in Section 9.02, in the event of damage to or destruction of any Improvements
by fire or otherwise (herein “Damage”),
Lessee shall promptly repair, restore and rebuild the same as nearly as
possible to their condition existing prior to such damage or destruction, or
replace the same with facilities that are substantially similar in function and
capacity to the Improvements Damaged (herein “Restore”
or “Restoration”), all at the sole
cost and expense of Lessee.  Payment of
Basic Rent, Minimum Guaranteed Wharfage, Impositions and other charges payable
by Lessee hereunder shall not abate because of any such Damage, except as
provided in Section 9.02.


Section 9.02.          LESSEE’S
ELECTION.  If any Improvements shall
be Damaged and (i) the cost of Restoration as reasonably estimated by Lessee (“Restoration Cost”) is an amount equal to or
greater than forty percent (40%) of the replacement cost of the Project
exclusive of excavations, footings and foundations as reasonably estimated by
Lessee (“Replacement Cost”), or
(ii) if any Improvements shall be Damaged during the last year of the Demised
Term and the Restoration Cost is an amount equal to or greater than ten (10%)
of the Replacement Cost, then, Lessee may, in its discretion, by written notice
to the Commission within sixty (60) days after the occurrence of such Damage,
subject to the consent of any Mortgagee, terminate this Lease effective as of a
date not later than sixty (60) days after the date of the notice of
termination.  In the event there is no Mortgage
in effect at the time of the Damage and either (i) or (ii) above occurs, Lessee
shall consult with the Commission and consider in good faith the Commission’s
views as to whether or not to terminate this Lease or Restore the Improvements
Damaged.  Upon any such termination of
this Lease, all Basic Rent, Impositions, Minimum Guaranteed Wharfage and other
charges hereunder of all types shall be adjusted and prorated to the date of
such termination and all other rights and obligations of the parties hereunder
(except under Sections 14.03 and 3.04) thereafter accruing shall be terminated
as of the date of such termination.


As used herein, “Insurance Proceeds”
means and includes all proceeds of the property insurance under Section. 8.02
with respect to any Damage (except any such proceeds with respect to Lessee’s
personal property and Equipment and the interruption of Lessee’s business,
which proceeds shall be Lessee’s property). 
If Damage occurs (a) the party that first becomes aware of it shall
notify the other; (b) all claims for Insurance Proceeds shall be made by
Lessee; (c) Mortgagee may participate in negotiating all claims to Insurance
Proceeds and control the settlement thereof; (d) Lessee and the Commission may
participate in negotiating all claims to Insurance Proceeds and, if there is no
Mortgage in effect, Lessee shall control the settlement thereof; (e) the
parties shall direct the insurer to pay all Insurance Proceeds to Mortgagee or,
if there is no Mortgage in effect, to an insurance trustee as described below;
(f) each party’s rights to receive Insurance Proceeds shall be subject to the
rights of Mortgagee; and (g) all Insurance Proceeds shall be paid and applied
as follows:



 27
 









 


(i)                                     If
and for so long as any Mortgage shall be in effect, all Insurance Proceeds
shall be paid to the Mortgagee under the most senior Mortgage, to be held,
applied and paid in accordance with the following provisions:  (A) if this Lease is not terminated, and if
no default or event of default is continuing under such Mortgage, such
Insurance Proceeds shall be applied (1) first, to pay the out-of-pocket costs
of the Mortgagee, Lessee and the Commission, including reasonable attorneys’
fees, in connection with the collection of such Insurance Proceeds; (2) next,
such Insurance Proceeds shall be made available to Lessee to pay for the cost
of Restoration and Lessee shall perform such Restoration; and (3) next, any
remaining Insurance Proceeds shall at the option of Lessee (to be exercised
either in the Mortgage or at any other time) be paid to Lessee as its property
or applied to the indebtedness secured by such Mortgage; or (B) if this Lease
is terminated or, if a default or event of default is continuing under such
Mortgage, such Insurance Proceeds shall be applied as provided in such
Mortgage; provided, however, Lessee shall be obligated to demolish and remove
the Improvements and restore the Real Estate pursuant to Section 14.03 and,
prior to payment to anyone else, the Insurance Proceeds shall be used to pay
such demolition and restoration costs.


(ii)                                  If
there is no Mortgage in effect, all Insurance Proceeds shall be paid to an
insurance trustee located in Indianapolis, Indiana, reasonably selected by
Lessee and reasonably satisfactory to the Commission, to be held, applied and
paid as follows:  (A) if this Lease is
not terminated and no default or Event of Default is continuing hereunder, such
Instance Proceeds shall be applied (1) first, to pay the out-of-pocket expenses
of Lessee and the Commission, including reasonable attorneys’ fees, in
connection with the collection of such Insurance Proceeds; (2) next, such
Insurance Proceeds shall be made available to Lessee to pay for the cost of
Restoration and Lessee shall perform such Restoration; and (3) next, any
remaining Insurance Proceeds shall be paid to the Lessee; or (B) if this Lease
is terminated, or if a default or Event of Default is continuing hereunder,
such Insurance Proceeds shall be paid (1) first, to pay for Lessee to demolish
and remove the Improvements and restore the Real Estate pursuant to Section
14.03; (2) next, to Lessee to pay the out-of-pocket expenses of Lessee,
including reasonable attorneys’ fees, in connection with the collection of such
Insurance Proceeds; (3) next, to the Commission to the extent necessary to cure
the default or Event of Default; and (4) next, any remaining Insurance Proceeds
shall be paid to Lessee subject to the following sentence.


Mortgagee or any trustee acting under Section 9.02(i) or (ii) or
Section 10.04(i) or (ii) shall be entitled to act on any document it believes
to be genuine; shall have no liability in connection with actions under said
Sections, except such liability as may arise from its willful misconduct or
gross negligence; and may consult with counsel of its choice, including
attorneys employed by it, and shall not be liable for any actions taken or
omitted in accordance with the advice of such counsel.


If Lessee is required to Restore, from and after adjustment and
settlement of the Insurance Proceeds, Lessee shall prosecute with due diligence
the Restoration work so that it shall be 



 28
 









 


completed as promptly as reasonably possible; subject however to the
availability of replacement materials for any damaged Improvements and
replacement parts for any damaged Equipment and Force Majeure.  All such work shall be accomplished in
accordance with Article IV.


ARTICLE X



EMINENT DOMAIN


Section 10.01.        TOTAL
TAKING.  If the entire Leased
Premises shall be taken by an exercise of the power of eminent domain
(hereinafter, including a sale, assignment or other transfer in lieu thereof,
the “Proceeding” or “Condemnation Proceeding”), this Lease shall
terminate as of the date of the vesting of title in the taking authority
pursuant to such Proceeding.  The Basic
Rent, Minimum Guaranteed Wharfage, Impositions and other charges payable by
Lessee hereunder shall be apportioned as of the date of such termination, and
neither party shall have any further liability hereunder, except as provided in
this Article.


Section 10.02.        PARTIAL TAKING.  If less than the entire Leased Premises or
any right appurtenant thereto shall be taken in any such Proceeding, this Lease
shall terminate as to the portion of the Leased Premises so taken upon the
vesting of title in the taking authority pursuant to such Proceeding.  If such partial taking should make it no
longer economic, in Lessee’s good faith judgment, to use the remainder of the
Leased Premises not so taken for the Permitted Uses,  then, Lessee may, in its discretion, by
written notice to the Commission within sixty (60) days after the vesting of
title of the portion of the Leased Premises so taken, subject to the consent of
any Mortgagee, terminate this Lease effective as of a date not later than sixty
(60) days after the date of the notice of termination.  In the event there is no Mortgage in effect
at the time of the Proceeding, Lessee shall consult with the Commission and
consider in good faith the Commission’s views as to whether or not to terminate
this Lease.  Upon such termination of
this Lease, all Basic Rent, Impositions, Minimum Guaranteed Wharfage and other
charges hereunder of all types shall be adjusted and prorated to the date of
such termination and all other rights and obligations of the parties hereunder
(except under Sections 14.03 and 3.04) thereafter accruing shall be terminated
as of the date of such termination.


In the event of a taking of a portion of the Leased Premises, if Lessee
does not terminate this Lease as to the remainder of the Leased Premises, the
Basic Rent and Impositions, shall be equitably reduced in proportion to the
reduction in acreage resulting from such taking.  Lessee shall be responsible for any necessary
Restoration of the Leased Premises as required for Lessee’s use thereof, and
the provisions and conditions in Article IV shall similarly apply to the
Restoration work.


Section 10.03.        TEMPORARY TAKING.  If all or any portion of the Leased Premises
is taken by the exercise of the right of eminent domain for a limited period
(being agreed between the parties on six (6) months or less), this Lease shall
not terminate and Lessee shall continue to perform its obligations hereunder as
though such taking had not occurred, except to the extent that it may be unable
to do so because of the taking.  In the
event of such a temporary taking, (x) if any Mortgage is in effect, the entire
award shall be paid to the Mortgagee to be held, applied and paid as provided
in Section 10.04(i), and (y) if no Mortgage is in effect, the entire award
shall be paid to Lessee if no Event of Default is continuing, unless the period
of public occupancy extends 


 



 29
 









 


beyond the termination of the Demised Term,
in which case the award shall be apportioned between the Commission and Lessee
as of the date of such termination and Lessee’s portion shall be paid as
provided in clause (x) or (y) above as applicable.  Lessee covenants that at the termination of
any such temporary taking during the Demised Term it will, at its sole cost and
expense, unless the taking was initiated by the State of Indiana, Restore the
Leased Premises as nearly as may be reasonably possible to the condition in
which the same were prior to such taking.


Section 10.04.        DISTRIBUTION OF DAMAGES.  As used herein, “Condemnation Proceeds” shall mean and include all damages,
awards and proceeds with respect to the Leased Premises in any Condemnation
Proceeding (except any such proceeds with respect to Lessee’s personal property
and Equipment, Lessee’s relocation expenses and interruption of Lessee’s
business, which proceeds shall be Lessee’s property).  If a Condemnation Proceeding occurs (a) the
party that first becomes aware of it shall notify the other; (b) all claims for
Condemnation Proceeds shall be made by Lessee; (c) Mortgagee may participate in
negotiating all claims to Condemnation Proceeds and control the settlement
thereof; (d) Lessee and the Commission may participate in negotiating all
claims to Condemnation Proceeds and, if there is no Mortgage in effect, Lessee
shall control the settlement thereof; (e) the parties shall direct the payer to
pay all Condemnation Proceeds to Mortgagee or, if there is no Mortgage in
effect, to an trustee as described below; (f) each party’s rights to receive
Condemnation Proceeds shall be subject to the rights of Mortgagee; and (g) all
Condemnation Proceeds shall be paid and applied as follows:


(i)                                     If
and for so long as any Mortgage shall be in effect, all Condemnation Proceeds
shall be paid to the Mortgagee under the most senior Mortgage, to be held,
applied and paid in accordance with the following: (A) first, to the Commission
(1) to reimburse the Commission for its out-of-pocket costs, including
reasonable attorneys’ fees, incurred in connection with the Proceeding; and
(2), to pay to the Commission the value of the Real Estate and any other
interest taken in the Proceeding determined as encumbered by this Lease; (B)
next, if this Lease is not terminated, and if no default or event of default is
continuing under such Mortgage, such Condemnation Proceeds shall be applied (1)
next, to pay the out-of-pocket costs of the Mortgagee and Lessee, including
reasonable attorneys’ fees,  in
connection with the collection of such Condemnation Proceeds; (2) next, such
Condemnation Proceeds shall be made available to Lessee to pay for the cost of
Restoration and Lessee shall perform such Restoration; and (3) next, any
remaining Condemnation Proceeds shall at the option of Lessee (to be exercised
either in the Mortgage or at any other time) be paid to Lessee as its property
or applied to the indebtedness secured by the Mortgage; or (C) if this Lease is
terminated, or if a default or event of default is continuing under such
Mortgage, such Condemnation Proceeds shall be applied as provided in such
Mortgage; provided, however, Lessee shall be obligated to demolish and remove
the Improvement and restore the Real Estate pursuant to Section 14.03 prior to
payment to anyone else and the Condemnation Proceeds shall be made available to
Lessee to pay such demolition and Restoration costs.


(ii)                                  If
there is no Mortgage in effect, all Condemnation Proceeds shall be paid to a
trustee located in Indianapolis, Indiana, reasonably selected by Lessee and 


 



 30
 









 


 reasonably satisfactory to the
Commission, to be held, applied and paid as follows:  (A) first, to the Commission (1) to reimburse
the Commission for its out-of-pocket costs, including reasonable attorneys’
fees, incurred in connection with the Proceeding; and (2) to pay to t he
Commission the value of the Real Estate taken in the Proceeding determined as
encumbered by this Lease; (B) next, if this Lease is not terminated and no
default or Event of Default is continuing hereunder, such Condemnation Proceeds
shall be applied (1) next, to pay the out-of-pocket expenses of Lessee,
including reasonable attorneys’ fees, in connection with the collection of such
Condemnation Proceeds; (2) next, such Condemnation Proceeds shall be made
available to Lessee to pay for the cost of Restoration and Lessee shall perform
such Restoration; and (3) next, any remaining Condemnation Proceeds shall be
paid to the Lessee; or (B) if this Lease is terminated, or if a default or
Event of Default is continuing hereunder, such Condemnation Proceeds shall be
paid (1) first, to pay for Lessee to demolish and remove the Improvements and
restore the Real Estate pursuant to Section 14.03; (2) next, to Lessee to pay
the out-of-pocket expenses of Lessee, including reasonable attorneys’ fees, in
connection with the collection of such Condemnation Proceeds; (3) next, to the
Commission to the extent necessary to cure the default or Event of Default; and
(4) next, any remaining Condemnation Proceeds shall be paid to Lessee.


Section 10.05.        VESTING
OF TITLE.  Whenever the term “vesting
of title” or any similar phrase is used in this Article, a taking of possession
by the condemning party shall be deemed a vesting of title.


Section 10.06.        RIGHTS
ON TERMINATION.  Upon any termination
of this Lease as a result of an exercise of a right of eminent domain, all
Basic Rent, Impositions, Minimum Guaranteed Wharfage and charges of all types
shall be adjusted and prorated to the date of such termination and all other
rights and obligations of the parties hereunder thereafter accruing shall be
terminated as of said date.


ARTICLE XI



DEFAULTS AND REMEDIES


Section 11.01.        DEFAULTS
BY LESSEE.  The happening of any one or
more of the following events shall be deemed to be an “Event of Default”:


(a)           The failure of
Lessee to pay any installment of Basic Rent, Minimum Guaranteed Wharfage, Port
Tariff charge, any Impositions, additional rent or any other amounts hereunder
within five (5) days of when due;


 


(b)           The making by Lessee
or by any guarantor of Lessee’s obligations hereunder of a general assignment
for the benefit of its creditors in connection with an insolvency
reorganization, liquidation or dissolution of Lessee or Guarantor;


 



 31
 









 


(c)           Except in connection
with a Foreclosure of a Mortgage, the levying of a writ of execution or
attachment on or against the Leased Premises as the property of Lessee and the
same is not released or discharged within thirty (30) days after written notice
thereof, or the taking by any party of the leasehold created hereby, or any
part thereof, upon foreclosure or other process of law or equity, except as
permitted hereunder;


(d)           Institution of
proceedings in a court of competent jurisdiction for an insolvency
reorganization, liquidation or dissolution of Lessee or of any guarantor of
Lessee’s obligations hereunder, or for their adjudication as a bankrupt or
insolvent, or for the appointment of a receiver of the property of Lessee or of
any guarantor of Lessee’s obligations hereunder, and said proceedings are not
dismissed, and any receiver, trustee or liquidator appointed therein
discharged, within one hundred eighty (180) days after the institution of said
proceedings;


(e)           The failure of any guarantor
of Lessee’s obligations hereunder to perform any of its covenants under said
guarantor’s guaranty agreement with the Commission within thirty (30) days
after written notice thereof from the Commission to Lessee;


(f)            Any representation
or warranty made herein, or in any financial statement or other document
furnished pursuant to the provisions hereof, shall prove to have been false or
misleading in any material respect as of the time made and any material adverse
consequences thereof shall not be cured within thirty (30) days after written
notice thereof from the Commission to Lessee;


(g)           The vacating or
abandonment of the Leased Premises, which shall be rebutably presumed if Lessee
is absent from the Leased Premises for ten (10) consecutive days or more;


(h)           Lessee fails, by
January 1, 2010, together with its Affiliates, agents, suppliers, contractors
and sub-contractors, to actively employ the equivalent of at least 50 full time
workers at the Leased Premises and such failure shall not be cured within
thirty (30) days after written notice thereof by the Commission to the Lessee;


(i)            Lessee defaults in
the performance of any of its covenants under this Lease (which pursuant to
other terms hereof includes the Addendum), other than those set forth in (a)-(h)
immediately above, and fails to cure such default within thirty (30) days after
written notice thereof.


If such default is of such a character as to require more than a thirty
(30) day period to cure such default, such failure shall not be considered to
be an Event of Default if Lessee has commenced to cure such default within
thirty (30) days of receipt of written notice from the Commission and Lessee
diligently pursues that cure to completion. 
In that instance, such default will not allow the Commission to exercise
its remedies until a period of ninety(90) days has expired after said notice
and the default remains uncured.  Once
that ninety (90) day period has expired and the default has not been cured, the
Commission will have all of its remedies under the Lease Agreement.  If the Lessee has commenced to cure such
default within the thirty (30) day period and has diligently pursued such cure
but it has not yet completed such cure within such ninety (90) day period, then
the Lessee may request an extension of such ninety (90) day period, which
extension shall not be unreasonably withheld.



 32
 









 


Subject to applicable law, in the event that Lessee is
adjudicated to be a bankrupt, this Lease shall automatically terminate and be
of no further force or effect.


Section 11.02.        REMEDIES.  Upon the occurrence and during the
continuance of an Event of Default, the Commission may, subject to applicable
law:


(a)           Without terminating
this Lease, re-enter the Leased Premises, with or without process of law, using
such means as may be necessary, remove all persons and property therefrom, and
re-let the Leased Premises (or any part thereof) for such term or terms (which
may extend beyond the Demised Term) and at such rental and upon such other
terms as the Commission deems advisable. 
The Commission shall not be liable to Lessee for damages or otherwise by
reason of such re-entry.  Upon regaining
possession of the Leased Premises, the Commission may relet the Leased Premises
at such rental and upon such terms as the Commission may deem reasonable under
the circumstances.  The Commission is
authorized to make all necessary repairs and alterations in or to the Leased
Premises for the new lessee and to charge the cost thereof to Lessee.  Any re-entry, repossession and removal by the
Commission shall not be a waiver, release or discharge of any obligation or
liability of Lessee hereunder. 
Notwithstanding any re-entry without termination, the Commission may at
any time thereafter elect to terminate this Lease for Lessee’s default, and be
entitled to the damages set forth in (c) below.


(b)           Without terminating
this Lease, pursue an action for recovery of Basic Rent, Minimum Guaranteed
Wharfage, Impositions, Port Tariff charges, and all other charges payable over
the remainder of the Demised Term of this Lease as the same become due an
payable, less the net proceeds of any reletting of the Leased Premises pursuant
to  (a) above.


(c)           Terminate this Lease
and all rights of Lessee hereunder, without terminating Lessee’s obligations
hereunder, reenter the Leased Premises, with or without process of law, using
such lawful means as may be necessary, and remove all persons and property
there from, and the Commission shall not be liable for damages or otherwise by
reason of such reentry.  The Commission
shall also be entitled to recover immediately, as and for liquidated and agreed
final damages for Lessee’s default, in lieu of the damages in (b) above and any
other comparable damages under applicable law, an amount equal to (i) the
positive difference between (x) the rent and all additional rent reserved
hereunder, if any, for the period to the date upon which the Demised Term would
have ended but for the default of Lessee and (y) the then fair and reasonable
rental value of the Leased Premises for the same period, each discounted to the
present value thereof at an interest rate per annum equal to the Stated Rate as
of the date of such termination, plus (ii) an amount equal to two years of
Basic Rent and Minimum Guaranteed Wharfage, provided that the amount in clause
(i) shall be subtracted form the amount in clause (ii).


(d)           The Commission shall
also be entitled to exercise any other right or remedy available to the
Commission at law or in equity in addition to or as an alternative to any of
the other rights and remedies of the Commission herein specified upon the
occasion of any Event of Default.


 



 33
 









 


Lessee shall be liable for the cost of seizure and repossession of the
Leased Premises and reasonable attorneys’ fees incurred as a result of, or to
complete, the seizure and repossession of the Leased Premises.


Section 11.03.        SECURITY
INTEREST.


(a)           Lessee hereby grants
and transfers to the Commission a security interest in all inventory, equipment
and fixtures now or hereafter located on the Leased Premises or at anytime used
in connection with Lessee’s business carried out on the Leased Premises to
secure the performance by Lessee of Lessee’s obligations under this Lease (the “Collateral”).  Lessee represents and warrants to the
Commission that (i) such security interest will grant to the Commission a first
lien priority security interest in the Collateral and that no other person or
entity holds a security interest in such Collateral; and (ii) Lessee will be
the owner of all Collateral.  Lessee
hereby authorizes the Commission to execute and file financing statements
signed only by a representative of the Commission covering the security
interest granted hereby.


(b)           If an Event of
Default shall have occurred and be continuing, the Commission, at its option,
subject to applicable law, shall be entitled to enter the Leased Premises and
to take immediate possession of the property which is the subject of this
security interest for purposes of disposition or rendering the same unusable.  Upon repossession, the Commission may propose
to retain such property in satisfaction of the obligation of the Lessee secured
hereby or collect or sell all or any portion of same at public or private sale
in accordance with the Uniform Commercial Code as adopted and in effect in
Indiana or any other applicable statute. 
Upon request by the Commission, Lessee shall assemble and make such
property available to the Commission at a place designated by the Commission,
which is reasonably convenient to both the Commission and Lessee.


(c)           Lessee agrees that
the requirement of reasonable notification by the Commission to Lessee of the
time and place of any public or private sale or of the date after which any
private sale or other indicated disposition is to be made shall be met if written
notification is sent at least ten (10) days prior to the date of sale or
disposition.  In the further event that
the Commission shall collect or dispose of any or all of said property after
default, the proceeds of disposition shall be applied in the following order:


(i)                                     To
the reasonable expenses of retaking, holding, preparing for sale, selling,
collecting and the like;


(ii)                                  To
the reasonable attorneys’ fees and legal expenses incurred by the Commission;
and


(iii)                               To
the satisfaction of the obligations of Lessee secured hereby.  Lessee releases and holds harmless the
Commission from any and all claims arising out of the repossession of said
property.


Any successor of Lessee, assignee of Lessee or any party at any time
having the rights of Lessee hereunder, for all purposes of this Section shall
be deemed (i) to have granted and transferred to the Commission, and by its
acceptance, succession or exercise, grants and transfers to the Commission, a
security interest in its respective inventory, equipment and fixtures now or 



 34
 









 


hereafter owned by it and located on the Leased Premises or at any time
used in connection with its business carried on in the Leased Premises, (ii) to
have authorized the Commission to execute and file financing statements, and (iii)
to have given the Commission the same rights as to it and its property as the
Commission has as to Lessee and Lessee’s property.


Section 11.04.        SUBORDINATION.  The Commission will subordinate its interest
hereunder to a Mortgagee provided such Mortgagee, as part of a subordination
agreement, agrees to restore (in accordance with Section 14.03) the Leased
Premises if said Mortgagee exercises its rights in and to such Collateral.  If Mortgagee elects not to exercise its
rights in and to such Collateral, it shall agree to waive its security
interest.


Section 11.05.        ADVANCES.  The Commission may, at its option, after
thirty (30) days prior notice by the Commission to Lessee (subject to Lessee’s
right to cure pursuant to Section 11.01(i)), cure any breach or default of the
Lessee and without any notice cure any Event of Default of Lessee.  Any cost or expense incurred by the
Commission in curing such a breach or default for the account of Lessee,
together with interest at an annual rate of ten percent (10%) per annum, shall
be deemed additional rental due from Lessee to the Commission within twenty
(20) days after demand by the Commission.


Section 11.06.        ATTORNEYS’ FEES.  In the event the Commission employs attorneys
to enforce all or any part of this Lease, modify this lease at the request of
Lessee, collect any rent due or to become due or recover possession of the
Leased Premises, the Lessee agrees to reimburse the Commission for its
reasonable attorney’s fees incurred thereby, provided that, in the case of any
such enforcement, collection or recovery of possession, the Commission is
the  successful party.


ARTICLE
XII



ACCESS TO PREMISES


Section 12.01.        INSPECTION.  The Commission shall have the right to enter
upon the Leased Premises at any reasonable time after reasonable notice to
Lessee for the purpose of inspecting the same to determine that Lessee is fully
performing all of its obligations under this Lease.  The Commission shall use reasonable efforts
to coordinate such inspections so as not to interfere with Lessee’s operations.


Section 12.02.        EXHIBITION OF LEASED PREMISES.  During the last six (6) months of the Demised
Term, the Commission may, upon reasonable notice and during normal business
hours, enter upon the Leased Premises for the purpose of exhibiting the same to
prospective lessees, operators or purchasers. 
At any time during the Demised Term, upon reasonable notice to Lessee,
the Commission shall have the right to enter upon the Leased Premises for the
purpose of exhibiting the same to prospective purchasers or mortgagees.


Section 12.03.        EXERCISE OF RIGHTS.  The parties stipulate and agree the entry by
the Commission upon the Leased Premises permitted by this section shall never
be deemed a trespass upon the Leased Premises or a constructive eviction of
Lessee therefrom.


 



 35
 









 


ARTICLE
XIII



THE COMMISSION’S COVENANTS AND WARRANTIES


Section 13.01.        COMMISSION’S COVENANT OF QUIET
ENJOYMENT.  The Commission covenants
and agrees that Lessee, upon paying the Basic Rent, Minimum Guaranteed
Wharfage, Impositions, Port Tariff charges and all other charges herein
provided for and observing and keeping the covenants, agreements and conditions
of this Lease on its part to be kept and performed, may lawfully and quietly
hold, occupy and enjoy the Leased Premises during the Demised Term in
accordance with the provisions hereof.


Section 13.02.        USE OF PUBLIC FACILITIES.  Lessee shall have the non-exclusive right to
use all public wharves, docks and related facilities existing at the Port or
which may hereafter be added, subject to (i) any preferential or exclusive
rights given by the Commission to others set forth in Exhibit G hereto (provided that the
Commission shall not amend or otherwise modify any such preferential or
exclusive rights in any way, or grant any additional preferential or exclusive
rights that would, have a material adverse effect on Lessee’s use or operation
of the Project), (ii) the rights of any operator thereof (provided that any
such operator shall take and operate subject to the provisions of this Lease),
and (iii) the provisions of Section 3.03, 3.04, 4.04  and 8.07 hereof.  In connection with its use of such public
facilities, Lessee shall cooperate with the tenants and users of such public
facilities and not impair their ability to use such public facilities in a
timely and efficient manner.


Section 13.03.        PUBLIC FACILITIES.  The Commission shall use reasonable efforts,
utilizing existing infrastructure, to provide rail and road access to the
Leased Premises. Notwithstanding the foregoing, Lessee agrees to indemnify and
hold the Commission harmless from any and all damage or injury resulting from
Lessee’s loading, unloading and any other use of the docks, wharves, berths,
channels, waterways, roads and rail tracks. 
The Commission does not guaranty rail service to the Port and/or the
Leased Premises.


Section 13.04.        DEFAULT BY THE COMMISSION.  In the event the Commission shall fail to
comply with and perform its obligations under this Lease, or commence to comply
with and perform and diligently proceed, within sixty (60) days after written
notice thereof has been given to the Commission by the Lessee, Lessee may  or (i) terminate this Lease, or (ii) exercise
any other remedy available to Lessee at law or in equity.


Section 13.05.        OTHER ETHANOL PLANTS.  The Commission agrees, subject to the
provisions below, during the Demised Term, not to enter into a new lease of
property at the Port for the construction of another ethanol production
facility.  Such agreement is subject to
all rights of existing tenants at the Port under existing agreements.  Such agreement shall terminate and be of no
further force and effect immediately upon the occurrence of any one of the
following events:


(i)                                     Termination
of this Lease;


(ii)                                  Failure
to meet the construction/operation time frames set forth in Section 4.01(b)
hereof;


 



 36
 









 


(iii)                               Failure
to produce sufficient ethanol to meet the minimum requirements set forth in
Section 3.04 hereof;


(iv)                              Failure
to meet the job creation requirements of Section 11.01(h) hereof; or


(v)                                 Any
Event of Default other than (ii) thru (iv) above occurs under the Lease and is
not cured after thirty (30) days prior written notice from the Commission.


The Commission represents and warrants that it has not granted any
other person a lease or right to construct or operate another ethanol
production facility at the Port.  The
Commission agrees that, in the event of a breach of the provisions of this
Section, the damages to Lessee may be difficult or impossible to determine and,
accordingly, the provisions of this Section may be enforced by an action or
proceeding for injunction and/or specific performance or any remedy available
to Lessee at law or in equity.


Section 13.06.        REPRESENTATIONS, WARRANTIES AND
AGREEMENTS.  The Commission makes the
following representations, warranties and agreements:


(a)           The
Commission is a body politic and corporate duly created, validly existing and
in good standing under the laws of the State of Indiana.  The Commission has full right, power and
authority to execute and deliver this Lease.


(b)           Neither
the execution and delivery of this Lease, nor the consummation of the
transactions contemplated hereby, nor compliance with the terms, conditions and
provisions hereof will conflict with or result in a breach of any law or any
regulation, order, writ, injunction or decree of any court or governmental
instrumentality or agency or any agreement or instrument to which the
Commission is a party or by which it or its property are subject or bound, or
constitute a default thereunder or result in the creation or imposition of any
lien, charge, security interest or encumbrance of any nature whatsoever upon
any of the property of the Commission pursuant to the terms of any such
agreement or instrument.


(c)           The
execution and delivery of this Lease has been duly authorized by all necessary
action on the part of the Commission, and no authorization, approval or consent
by, or from, any other governmental or public regulatory authority is necessary
for the Commission to enter into the same, except for the Attorney General of
the State of Indiana and the Governor as provided in Article II.  This Lease has been duly and validly executed
and delivered by the Commission and constitutes a legal, valid and binding
obligation of the Commission, enforceable in accordance with its terms, subject
to execution hereof by the Attorney General of the State of Indiana and the
Governor as provided in Article II.


ARTICLE
XIV


RIGHTS
ON TERMINATION OR EXPIRATION


Section 14.01.        SURRENDERING OF LEASED PREMISES.


(a)           At
the expiration or earlier termination of the Demised Term, whether by lapse of
time or otherwise, Lessee shall surrender the Leased Premises to the Commission
in such 


 



 37
 









 


condition at the time of surrender as this Lease
otherwise requires.  If Lessee elects to
surrender the Project to the Commission pursuant to Section 14.01(b) and the
Commission elects to accept such surrender pursuant to Section 14.01(c), such
surrender shall also include the surrender to the Commission of the Project
(other than Lessee’s fixtures, manufacturing equipment and movable equipment (“Equipment”) and other personal property) in an “AS-IS”
condition at the time of surrender, with both the Leased Premises and the
Project free and clear of all liens and encumbrances created by or arising out
of the acts of Lessee.


(b)           At the expiration or
earlier termination of the Demised Term, Lessee shall have the right to
surrender the Project to the Commission, provided that no Event of Default is
continuing at such time.  In order to
exercise such right at the expiration of the Demised Term, Lessee shall give
the Commission written notice of its election to surrender the Project to the
Commission not later than ninety (90) days prior to the scheduled expiration of
the Demised Term.  In order to exercise
such right upon the earlier termination of the Demised Term, Lessee shall give
to the Commission written notice of such election to surrender the Project to
the Commission not later than thirty (30) days after receipt by Lessee of the
notice of termination from the Commission. 
If Lessee does not give notice within the applicable period stated
above, of Lessee’s election to surrender the Project to the Commission, Lessee
shall be deemed to have elected not to surrender the Project, and Lessee shall
remove the Improvements (including Equipment and other personal property) from
the Leased Premises pursuant to Section 14.03.


(c)           If Lessee gives
notice within the applicable period stated above of its election to surrender
the Project to the Commission, the Commission shall have the right to accept or
reject Lessee’s surrender the Project by written notice to Lessee given within
sixty (60) days after the Commission’s receipt of Lessee’s notice electing to
surrender the Project.  If the Commission
does not give notice within said sixty (60) day period of the Commission’s
election to accept Lessee’s surrender the Project, the Commission shall be
deemed to have elected to reject such surrender.  If an Event of Default is continuing and the
Commission elects to terminate this Lease by reason thereof, the Commission
shall have the right to elect that Lessee so surrender the Project to the
Commission pursuant to Section 14.01(a), which right shall be exercisable by
the Commission by notice to Lessee contained in the Commission’s notice
terminating this Lease.  If the
Commission gives notice within said sixty (60) day period of the Commission’s
election to accept Lessee’s surrender of the Project or in the Commission’s
notice of termination, as applicable, Lessee shall surrender the Project
pursuant to Section 14.02.


Section 14.02.        DELIVERY
OF DOCUMENTS TO THE COMMISSION.  In
the event Lessee elects to surrender the Project to the Commission pursuant to
Section 14.01 and the Commission accepts such surrender pursuant to said
Section, upon the surrendering by Lessee of the Leased Premises, Lessee shall
within thirty (30) days after the 
expiration or earlier termination (as applicable) of the Demised Term
deliver to the Commission the following:


(a)           Such documents,
instruments and conveyances as the Commission may reasonably request to enable
the Commission’s ownership of the Improvements constructed by Lessee to be
reflected of record, including without limitation a deed or a termination of
lease, in recordable form, to the Improvements or a bill of sale.


 



 38















(b)           A recordable
assignment of Lessee’s interest as lessor in all subleases (if any),
theretofore approved by the Commission. 
Such assignment shall state the Commission shall not be obligated for
any prior default of Lessee under said subleases.


(c)           All deposits,
prepaid rents and other amounts held by Lessee under any subleases and
assignments of Lessee’s interest in all such items held by others for the
Commission or Lessee.


(d)           All construction
plans, elevations, specifications, surveys, permits and other Documents
(excluding proprietary information and trade secrets) relating to and necessary
or convenient for the operation of the Improvements constructed by Lessee.


(e)           All warranties on
the Improvements constructed by Lessee to the full extent such warranties are
assignable and all plans, elevations, specifications, engineering drawings and
prints relating to said Improvements together with bills of sale or assignments
to the Commission as the Commission may reasonably request with respect to any
of the above.


(f)            An amount equal to
the accrued but unpaid Impositions with respect to the Leased Premises,
prorated to the date of expiration or termination.  Impositions which are a lien and are payable
for prior years will be paid in full and Impositions which are a lien and are
payable or will become so for the year of termination shall be prorated to the
date of termination based on the best available information as to the amount of
Imposition due.  All documents required
to be delivered by Lessee to the Commission in this Section shall be in form
reasonably satisfactory to the Commission and Lessee.


Section 14.03.        REMOVAL
OF ALL IMPROVEMENTS.  In the event
Lessee elects not to surrender the Project to the Commission pursuant to
Section 14.01 or the Commission does not accept such surrender pursuant to said
Section, Lessee shall be required to demolish and remove from the Real Estate
all of the Improvements (including Equipment and other personal property), and
Lessee shall commence and complete, subject to Force Majeure, such demolition
and removal at Lessee’s sole cost and expense within a reasonable time and
shall restore the Real Estate substantially to their condition as of the date
of execution of this Lease.  Before
commencing any demolition or removal, Lessee shall furnish to the Commission
its plan for restoring the Leased Premises (the “Premises Restoration Plan”) and reasonable security assuring
completion of the demolition and removal and restoration as required by this
Section.  In the event that Lessee shall
fail to complete such demolition and removal within a reasonable time and such
failure shall continue for thirty (30) days after written notice by the
Commission to Lessee (or such longer period as may be required if Lessee is
prosecuting such demolition and removal with reasonable diligence), the
Commission shall be entitled to complete the same, and the out-of-pocket costs
thereof to the Commission shall be payable by Lessee within twenty (20) days
after demand therefor, and the Commission may recover such costs from the
security provided by Lessee.


Section 14.04.        PROPERTY
NOT REMOVED.  Upon the expiration or
earlier termination of this Lease, provided an Event of Default does not exist
and provided Lessee has provided the security required by Section 14.03, Lessee
shall have the right to remove all of its fixtures, Equipment and other
personal property.  Any such property of
Lessee which shall remain in or upon the 


 



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Leased Premises for more than thirty (30) days after the expiration or
earlier termination of this Lease shall be deemed to have been abandoned by
Lessee and, at the option of the Commission, such property: (a) shall be
retained by the Commission as its property; (b) shall be disposed of by the
Commission in such manner as the Commission shall determine, without
accountability to Lessee or any other person; or (c) shall be promptly removed
by Lessee at Lessee’s expense upon written request thereof from the
Commission.  The Commission shall not be
responsible for any loss or damage occurring to any property owned by
Lessee.  In addition, if the property is
left at the Leased Premises, the Commission may deem Lessee to be holding over
in accordance with Section 14.05.


Section 14.05.        HOLDING
OVER.  In the event Lessee remains in
possession of the Leased Premises with the consent of the Commission after the
expiration of the Demised Term, and without the execution of a new Lease or an
extension of this Lease, it shall be deemed to be occupying the Leased Premises
as a lessee from month to month at one hundred fifty percent (150%) of the
Basic Rent payable during the last month of the Demised Term, and subject to
all the other conditions, provisions and obligations of this Lease insofar as
the same are applicable to a month-to-month tenancy, including the payment of
additional rent and all other charges required hereunder.  Such month-to-month tenancy may be terminated
by either party as of the end of any calendar month upon the giving of notice
of such termination prior to the beginning of such calendar month.


Section 14.06.        SURVIVAL.  Notwithstanding the expiration or earlier
termination of this Lease, Lessee and the Commission shall be obligated to pay
and/or perform all amounts and indemnities set forth in this Lease accrued or
arising out of events occurring on or prior to the date of such expiration or
termination, which obligations shall survive the expiration or termination of
this Lease.


ARTICLE XV



HAZARDOUS MATERIAL


Section 15.01.        HAZARDOUS
MATERIAL.


(a)           Subject to the
Permitted Uses as provided for in Section 5.01, Lessee shall not use, store,
generate, treat, transport, dispose of, handle, stevedore or warehouse any
Hazardous Materials, in, from, under or about the Leased Premises or otherwise
in the Port.  Provided however, (A) petroleum
and petroleum derivatives in limited quantities and as necessary for the
Permitted Uses, may be used and located at the Leased Premises if such
substances are kept in compliance with all Environmental Laws except that
Underground Storage Tanks may not be used, unless approved pursuant to Section
15.01(f) below, and (B) other materials or substances may be used in quantities
necessary for the Permitted Uses, provided such materials are kept in
accordance with all provisions of this Article XV.  All Hazardous Materials besides those listed
in this subsection as permitted are prohibited, and use or other handling of
same by Lessee shall be considered an Event of Default under this Lease.


The term “Hazardous Material”
as used herein means any hazardous or toxic substance, material or waste which
is or becomes regulated by any local governmental authority, the State 


 



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of Indiana or the United States Government.  The term “Hazardous
Material” includes, without limitation, any material or substance
which is (i) designated as a “hazardous substance” pursuant to Section 311 of
the Federal Water Pollution Control Act, as amended from time to time (33
U.S.C. Section 1321), (ii) defined as a “hazardous waste” pursuant to Section
3004 of the Federal Resource Conservation and Recovery Act, as amended from
time to time (42 U.S.C. Section 6904), (iii) defined as a “hazardous substance”
pursuant to Section 101 of the Comprehensive Environmental Response,
Compensation and Liability Act, as amended from time to time (42 U.S.C. Section
9601), (iv) petroleum or petroleum derivatives, or (v) fertilizer (liquid or
solid).


(b)           Lessee, at its sole
cost and expense, shall comply with all laws, statutes, ordinances, rules,
regulations and orders of any governmental authority having jurisdiction
concerning environmental, health or safety matters (“Environmental Laws”), including, but not limited to, any
discharge into the air, surface water, sewers, soil or groundwater; any use,
generation, treatment, storage, disposal or transportation of any Hazardous
Material (as hereinafter defined) by Lessee, its agents, employees, contractors
or invitees, whether within or outside the Leased Premises or otherwise in the
Port; permitting; and reporting upon releases or spills of materials.


(c)           Lessee shall provide
the Commission, on the lease anniversary date, written certification that it is
in compliance with all Environmental Laws or shall explicitly describe Lessee’s
noncompliance, including Lessee’s intended course of action and time frame for
coming into compliance.  Additionally,
Lessee shall provide the Commission with a duplicate copy of any emergency
preparedness and response plans or any environmental compliance audits of
self-analyses which it has prepared or has had prepared pursuant to any legal
requirement or for any other reason.  The
Commission assumes no responsibility for reporting or implementation of the
plan by virtue of possession of said duplicate copy.


(d)           Lessee shall provide
the Commission with copies of any notice of alleged violations by Lessee, or of
claims against Lessee, relating to Environmental Laws, or any changes to its
emergency preparedness and response plans. 
Lessee shall provide such copies within five (5) days of receiving any
such notice or making any such change. 
Lessee shall give written notice to the Commission within one (1)
business day after the date on which Lessee learns or first has reason to
believe that any release, discharge or emission of any Hazardous Material has
occurred on, in, or about the Leased Premises.


(e)           Lessee, on its own
behalf and on behalf of its successors and assigns, hereby releases and forever
discharges the Commission, its officers, directors, employees and agents, both
in their capacities as corporate representatives and as individuals, from any
and all claims, actions or liabilities of any manner whatsoever, whether in law
or equity, whether now or hereafter claimed or known, which Lessee now has or
may have in the future against the Commission arising from or relating in any
way to releases or threatened releases of Hazardous Material brought upon,
generated or discharged from, or stored or used in or about the Leased Premises
or otherwise in the Port by Lessee, its successors, assigns, agents, employees,
contractors or invitees, or which arise from Lessee’s failure or alleged
failure to comply with all Environmental Laws.


 



 41
 









 


(f)            Lessee shall not
install any tank (as such term is defined in 40 C.F.R. §260.10, as amended from
time to time) on the Leased Premises without the prior written approval of the
Commission.


(g)           If the presence of
any Hazardous Material in the Leased Premises or otherwise in the Port caused
or permitted by Lessee (even if consented to or allowed by the Commission) or
Lessee’s use, storage, treatment, transportation, generation or disposal of
Hazardous Material results in contamination (in any amount or degree) of the
Leased Premises, the Port, other property not a part of the Port, or injury to
any person, then Lessee shall indemnify, defend and hold the Commission
harmless from any and all claims, judgments, damages, penalties, fines, costs,
liabilities or losses (including without limitation, diminution in value of the
Leased Premises or the Port, damages for the loss or restriction on use of
rentable or usable space or of any amenity of the Leased Premises or the Port,
damages arising from any adverse impact on marketing of space in the Port, and
sums paid in settlement of claims, actual attorneys’ fees, consultant fees and
expert fees) which arise during or after the Demised Term as a result of such
contamination or injury.  This
indemnification of the Commission by Lessee includes, without limitation, costs
incurred in connection with any investigation of site conditions or any
cleanup, remediation, removal, response or restoration work required by any
federal, state or local governmental agency or political subdivision because of
Hazardous Material present in the soil or ground water on or under the Leased
Premises or other property not a part of the Port.  The indemnification and hold harmless
obligations of Lessee under this Section shall survive any termination of the
Lease.  Without limiting the foregoing,
if the presence of any Hazardous Material in the Leased Premises or otherwise
in the Port caused or permitted by Lessee results in any contamination of the
Leased Premises or the Port, Lessee shall promptly take all actions at its sole
expense as are necessary to return the Leased Premises or the Port to the
condition existing prior to the introduction of any such Hazardous Material to
the Leased Premises or the Port; provided that the Commission’s approval of
such actions shall first be obtained, which approval shall not be unreasonably
withheld so long as such actions, in the Commission’s sole and absolute
discretion, would not potentially have any materially adverse long-term or
short- term effect on the Leased Premises or the Port.  Lessee shall not enter into any settlement
agreement, consent, decree or other compromise with respect to any claims
relating to any Hazardous Material in any way connected with the Leased
Premises without first notifying the Commission of Lessee’s intention to do so
and offering the Commission the opportunity to participate in any such
proceedings.


(h)           The Commission shall
have the right, at any time, to cause at least four (4) permanent testing wells
to be installed in the Leased Premises in locations selected by the Commission
at the Commission’s sole discretion and may at its option cause the ground
water to be tested to detect the presence of Hazardous Material at least once
every twelve (12) months during the Demised Term by the use of such tests as
are then customarily used for such purposes. 
If Lessee so requests, the Commission shall supply Lessee with copies of
such test results.


The costs of such tests and of the maintenance, repair
and replacement of such wells shall be deemed an Imposition for which Lessee
shall be liable for the cost thereof. 
Lessee shall have the right at any time during the Demised Term to
conduct its own test of the ground water underlying the Port by using such
wells so long as each of the following conditions are satisfied: (i) such tests
are conducted by Lessee at its own expense; (ii) Lessee repairs any damage to
such 


 



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wells caused by such tests; and (iii) Lessee delivers
copies of the results of such tests to the Commission.


(i)            Any increase in the
premiums for necessary insurance on the Leased Premises or the Port which
arises from Lessee’s use, generation, transport and/or storage of Hazardous
Materials shall be solely at Lessee’s expense. 
Lessee shall procure and maintain at its sole expense such additional
environmental insurance as may be necessary to comply with any requirement of
any Federal, State or local government agency with jurisdiction.  Lessee shall provide to the Commission
evidence of insurance or other financial resources available to Lessee
sufficient to assure Lessee’s ability to comply with its obligations under this
Section and the Environmental Laws.


(j)            The Commission
shall have the right, from time to time, as deemed reasonably necessary by the
Commission and during the last year of the Demised Term, to perform
environmental inspections, audits or site assessments of the Leased Premises (“Environmental Audits”) to ascertain Lessee’s
compliance with the terms of this Section. 
In the event the Commission’s Environmental Audits reveal
non-compliance, the Commission shall so notify Lessee (“Commission’s Non-Compliance Notice”) and
Lessee shall have a period of sixty (60) days from receipt of Commission’s
Non-Compliance Notice to remedy such non-compliance, provided that if the
non-compliance extends beyond sixty (60) days through no fault of Lessee’s,
Lessee shall have additional time to remedy such compliance.  In the event Lessee fails to remedy the
non-compliance in the aforesaid period, the Commission shall have the right to
do so and Lessee shall, upon demand, reimburse the Commission for the costs
thereof plus interest thereon at ten percent (10%) per annum from the date such
costs are incurred to the date such costs are repaid to the Commission.  The Commission may also provide a copy of
such Environmental Audits to any federal, state or local governmental agency
having jurisdiction over the Leased Premises or Hazardous Materials.  The responsibility for paying for the
Environmental Audits shall be determined according to subsection “k” of this
Section.


(k)           Prior to Lessee
taking possession of the Leased Premises, Lessee or the Commission may arrange
for an Environmental Audit (the “Baseline
Environmental Audit”) of the Leased Premises to determine the
presence of any Hazardous Material in the soil, surface water or groundwater of
the Leased Premises.  An environmental
consultant who shall be approved by both Lessee and the Commission shall
conduct the Baseline Environmental Audit. 
The Party acquiring the study shall pay for the cost of the Baseline
Environmental Audit.  The reports
prepared in connection with the Baseline Environmental Audit shall be provided
to both the Commission and the Lessee. 
If a Baseline Environmental Audit is not obtained under this provision,
there shall be a rebutable presumption that the Leased Premises are free from
the presence of any Hazardous Material as defined herein.


If any subsequent Environmental Audit conducted
pursuant to subsection “j” of this Section indicates the presence of Hazardous
Materials in amounts greater than those found in the Baseline Environmental
Audit, Lessee shall pay the costs of such subsequent Environmental Audit;
otherwise, the Commission and Lessee shall jointly pay the costs of such
subsequent Environmental Audit.


 



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(l)            Prior to expiration
or earlier termination of the Demised Term, Lessee shall (i) cause all
Hazardous Materials previously owned, stored or used by Lessee to be removed
from the Leased Premises and disposed of in accordance with applicable
Environmental Laws; (ii) remove any above ground or underground storage tanks
or other containers installed or used by Lessee to store any Hazardous
Materials on the Leased Premises, and repair any damage to the Leased Premises
caused by such removal; (iii) cause any soil or other portion of the Leased
Premises which has become contaminated by any Hazardous Materials stored or
used by Lessee on the Leased Premises to be decontaminated, detoxified or
otherwise cleaned up in accordance with the requirements of Environmental Laws
or applicable governmental authorities; and (iv) surrender possession of the
Leased Premises to the Commission free of contamination attributable to
Hazardous Materials generated, used, stored, treated or disposed of by Lessee
or stored or disposed of by any other party other than the Commission in or on
the Leased Premises during the Demised Term.


Should any clean up for which Lessee is responsible
not be completed prior to the expiration, or sooner termination of this Lease,
including any extensions thereof then: (i) Lessee shall deposit into an escrow
account an amount of money equal to the balance of the estimated cost of the
clean up, which amount shall be estimated by the Commission or its consultant,
together with instructions for the disbursement of such amount in payment of
the costs of any remaining clean up as it is completed, and (ii) if the nature
of the contamination or the clean up required of Lessee is of such a nature as
to make the Leased Premises untenantable or unleaseable, then Lessee, at the
Commission’s sole option, shall be liable to the Commission as a holdover
tenant until the clean up has been sufficiently completed to make the Leased
Premises suitable for lease to third parties.


(m)          If any Environmental
Audits conducted by the Commission or the financial information required of
Lessee hereunder indicate that Lessee does not have insurance or other financial
resources sufficient to enable Lessee to fulfill its obligations under this
Lease whether or not accrued, liquidated, conditional or contingent, then
Lessee shall, at the request of the Commission, procure and thereafter maintain
in full force and effect such environmental impairment liability and/or
pollution liability insurance policies or endorsements in addition to those
required hereunder, or shall otherwise provide such collateral or security
reasonably acceptable to the Commission as is appropriate to assure that Lessee
will be able to perform its duties and obligations under this Lease.


ARTICLE XVI



NOTICES/ESTOPPEL


Section 16.01.        MANNER
OF GIVING.  Whenever under this Lease
a provision is made for notice of any kind, such notice shall be in writing and
either personally delivered, sent by registered or certified mail, return
receipt requested, postage prepaid, or by recognized overnight courier
service.  Notice to the Commission shall
be mailed to 150 West Market Street, Suite 100, Indianapolis, Indiana 46204,
Attn: General Counsel and to Port of Indiana-Mount Vernon, Mount 2751 Bluff
Road, Mount Vernon, Indiana, Attn: Port Director, and to Ice Miller LLP, One
American Square, Suite 3100, Indianapolis, IN 46282-0200, Attn: Mark D. Grant,
Esq., or to such other post office address as the Commission may furnish to
Lessee for such purpose.


 



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Notice to
Lessee shall be mailed to Aventine Renewable Energy — Mt Vernon, LLC, 1300 S.
Second Street, Pekin, IL 61544 Attn: Ajay Sabherwal, with copy to Aventine
Renewable Energy, Inc., 1300 S. Second Street, Pekin, IL 61544 Attn:
__________, and with copy to Davis Polk & Wardwell, 450 Lexington Avenue,
New York, NY 10017, Attn: John H. Butler, Esq., or to such other addresses as
Lessee may furnish to the Commission for such purpose, and with copy to any
Mortgagee who has given notice of its Mortgage pursuant to Section 7.02 at its
address and with copy to its copy address furnished pursuant to Section 7.02,
or to such other addresses as such Mortgagee may furnish to the Commission for
such purpose.


Notice by (a) personal delivery, (b) recognized overnight national
courier service, or (c) registered or certified mail, is deemed to be received
at the time notice is delivered to a party’s designated address.  Confirmation by the courier delivering any
notice given pursuant to this section shall be conclusive evidence of receipt
of such notice.  Each party hereto agrees
that it will not refuse or reject delivery of any notice given hereunder, that
it will acknowledge, in writing, receipt of the same upon request and that any
notice rejected or refused by it shall be deemed for all purposes of this Lease
to have been received by the rejecting party on the date so refused or
rejected, as, conclusively established by the records of the U.S. Postal
Service or the courier service.  Any
notice required to be given within a stated period of time which is sent by
certified or registered mail, return receipt requested, shall be considered timely
if postmarked before midnight of the last day of such period.


Section 16.02.        ESTOPPEL
CERTIFICATES.  Lessee and the
Commission agree promptly following request by the other party to execute and
deliver an Estoppel Certificate.  The
term “Estoppel Certificate”
shall  mean an estoppel certificate,
certifying (a) that this Lease is unmodified and in full force and effect, or,
if modified, stating the nature of such modification and certifying that this
Lease, as so modified, is in full force and effect and the date to which the
Basic Rent and other charges are paid in advance, if any; (b) that there are no
uncured defaults or Events of Default hereunder on the part of the certifying
party, and that to the knowledge of the certifying party there are no uncured
defaults or Events of Default hereunder on the part of the other party, or if
there exist any such uncured defaults and Events of Default stating the nature
of such uncured defaults and Events of Default; and (c) the correctness of such
other information respecting the status of this Lease as may be reasonably
required by the party requesting the Estoppel Certificate.  A party’s failure to so execute and deliver
an Estoppel Certificate within ten (10) business days following written request
as required above shall be conclusive upon such failing party that as of the
date of said request for the same (i) that this Lease is in full force and
effect, without modification except as may be represented by the requesting
party, (ii) that there are no uncured defaults or Events of Default hereunder on
the part of the failing party, and that to the knowledge of the failing party
there are no uncured defaults or Events of Default hereunder on the part of the
other party, except as may be represented by the requesting party in such
request, and (iii) that no Basic Rent has been paid in advance except as may be
represented by the requesting party.


 



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ARTICLE XVII



public policy


Section 17.01.        POLICIES
AND OBJECTIVES.  As a public body,
the Commission is charged to maintain and operate the Port at all times in a
manner promoting and benefiting the public interest, including maximizing the
public’s use of the Port’s facilities by ensuring the provision of cost
effective and productive services to all potential users, and promoting
employment in the regions surrounding the Port, and the Commission has the
objectives to make the Port the leading Port in the southwestern Indiana
marketplace and to maximize revenue to the Commission from the use of the
facilities.


Section 17.02.        LESSEE
OBLIGATIONS.  Lessee understands and
supports the Commission’s foregoing public policies and objectives.  In furtherance thereof, Lessee hereby agrees
to:


(a)           Promote commerce at
the Port and foster the creation of employment within the region by operating
as efficiently as possible, and at a reasonable, competitive cost to shippers
and consignees;


(b)           Create a favorable
environment for the promotion of commerce at the Port through attention to
increased customer service levels and productivity;


(c)           Cooperate fully with
the Commission in its efforts to 
maximize commerce at the Port;


(d)           Foster harmonization
of employee-management relations throughout the Port;


(e)           Promote synergies
between Lessee’s operations and other maritime and industrial facilities at the
Port; and


(f)            Cooperate with
other operators at the Port and avoid unproductive forms of intra-port rivalry.


To the extent there are specific provisions of this
Lease concerning (a) — (f) above, (a) — (f) above shall be applied consistent
with such specific provisions of this Lease.


Section 17.03.        LESSEE’S
REVIEW.  The Commission shall have
the right to conduct periodic reviews of Lessee’s adherence to the foregoing
commitments and promotion of the Commission’s public policies and objectives
(the “Review”).  To assist the Commission in conducting this
Review, and within thirty (30) calendar days after receipt of written notice
from the Commission, Lessee shall provide the Commission a written report
summarizing Lessee’s performance and contributions to the accomplishment of the
foregoing public policies and objectives. 
Lessee also shall make available upon reasonable request, for inspection
by the Commission or its duly authorized representatives, all records,
statistics and financial data concerning Lessee’s operations at the Port,
provided, however, any information concerning charges to customers, which is
marked confidential by Lessee, shall be kept confidential by the Commission to
the extent allowed by law.  The
Commission will advise Lessee as to the results of the Commission’s Review, and
specifically as to any areas of concern requiring improvement.


 



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Section 17.04.        RESPONSE.  In the event the Commission determines that
Lessee’s performance with respect to the matters covered by the Review is
unsatisfactory, the Commission shall give Lessee written notice thereof.  Lessee shall have the right to respond
thereto in writing within twenty (20) calendar days, setting forth any
explanation or  mitigating factors or
considerations, as well as Lessee’s proposed corrective action, if any.  Lessee also shall have the opportunity, along
with any other interested parties, to address such issues with the Commission
at the Commission’s next monthly meeting, after which the Commission shall
determine what, if any, action it will take.


Section 17.05.        DEFAULT.  If the Commission determined that Lessee’s
explanation and proposed corrective action are inadequate and that continuance
of this Lease would not be in the public interest, the Commission may declare
Lessee to be in default hereunder (referred to herein as a “Public Policy Default”).  In such case, the Commission shall so notify
Lessee in writing, stating the Commission’s determination and the grounds
therefor.  Upon the occurrence of a
Public Policy Default, the Commission shall have those remedies set forth in
Section 11.02 hereof, provided, however, the Commission may only terminate this
Lease due to a default under this Article XVII in accordance with the following
provisions.  In the event the Commission
wants to terminate this Lease, the Commission shall provide written notice to
Lessee.  If Lessee disputes such
termination, it shall provide written notice of same to the Commission within
fifteen (15) days of the effective date of the Commission’s notice of
termination.  If Lessee provides timely
notice to the Commission, the Commission, in order to terminate the Lease for a
Public Policy Default, must seek and obtain a judicial decree that a Public
Policy Default has occurred.  Such decree
may also contain a judgment terminating this Lease.  Such decree shall be subject to appeal
pursuant to Indiana law and procedure, and such termination shall be suspended
pending the results of any such appeal.


ARTICLE XVIII


GENERAL PROVISIONS


Section 18.01.        FUTURE
EXPENSES AND INTERST RATE.


(a)           Lessee shall
reimburse the Commission for the Commission’s reasonable costs and expenses,
including reasonable attorneys’ fees of general and/or special counsel,
incurred in connection with the preparation of any future amendment,
modification or revision of this Lease, or for the preparation of any agreement
related hereto that is requested by Lessee. 
Such costs and expenses shall constitute additional rent under the
Lease, and the failure of Lessee to pay the same within ten  (10) days after demand by Lessee.


(b)           The interest rate
charged herein is stated as a fixed rate of ten (10) percent per annum.  However, the Parties stipulate and agree that
the actual interest rate charged at the appropriate time provided herein, shall
be the stated rate of ten (10) percent per annum or the then current prime rate
(defined as the United States Federal Reserve Bank’s Primary Credit Rate) plus
four (4) percent, whichever is higher (the higher rate being the “Stated Rate”).


Section 18.02.        REMEDIES
CUMULATIVE -NON-WAIVER.  Unless
stated as such party’s sole and exclusive remedy, the various rights and
remedies herein contained and reserved to each of 



 47
 









 


the parties shall not be considered as exclusive of any other right or
remedy of such party, but shall be construed as cumulative and shall be in
addition to every other remedy now or hereafter existing at law, in equity or
by statute, and said rights and remedies may be exercised and enforced
concurrently and whenever and as often as occasion therefore arises.  No delay or omission to exercise any right or
power by either party shall impair any such right or power, or be construed as
a waiver of any default or as acquiescence therein.  One or more waivers of any covenant, term or
condition of this Lease by either party shall not be construed by the other
party as a waiver of a subsequent or continuing breach of the same covenant,
term or condition.  The consent or
approval by either party to or of any act by the other party of a nature requiring
consent or approval shall not be deemed to waive or render unnecessary consent
to or approval of any subsequent similar act.


Section 18.03.        INTERPRETATION/COMPLETE
AGREEMENT/COUNTERPARTS.  The headings
of the several articles and sections contained herein are for convenience only
and do not define, limit or construe the contents of such articles and
sections.  Any references herein to
costs, expenses or similar amounts shall be references to out-of-pocket costs,
expenses and similar amounts.  Any
statements herein that an action or consent is not to be unreasonably withheld
shall mean that such action or consent is not to be unreasonably withheld,
conditioned or delayed.  All
negotiations, considerations, representations and understandings between the
parties are incorporated herein and may be modified or altered only by
agreement in writing signed by the party to be bound.  This Lease may be executed in multiple
counterparts, all of which, together, shall constitute one and the same
instrument.


Section 18.04.        GOVERNING
LAW.  This Lease and any questions of
interpretation thereof shall be governed by the laws of the State of Indiana.


Section 18.05.        SEVERABILITY
OF INVALID PROVISIONS.  If any
provision of this Lease shall be held to be invalid, void or unenforceable, the
remaining provisions hereof shall not be affected or impaired, and such
remaining provisions shall remain in full force and effect.


Section 18.06.        AGREEMENT
BINDING UPON SUCCESSORS.  The
covenants, agreements and obligations herein contained shall extend to, bind
and inure to the benefit not only of the parties hereto, but their respective
successors and assigns (subject to any restrictions on assignments, subletting
and transfers as provided herein).  The
covenants, agreements and obligations herein contained shall not inure to the
benefit of any persons other than the parties hereto, any Mortgagee under any
Mortgage granted pursuant to Section 7.02 and their respective successors and
assigns.


Section 18.07.        FORCE
MAJEURE.  Except as set forth in
Section 4.01(c), whenever this Lease requires any act (other than the payment
of a liquidated sum of money) to be performed by a certain time or within a
certain period of time, the time for the performance of such act shall be
extended by the period of any delays in such performance caused by war,
strikes, lockouts, civil commotion, unpreventable material shortages,
casualties, acts of God or other conditions or events beyond the control of the
party required to perform such act (“Force Majeure”), not to exceed an
extension of one hundred eighty (180) days.


 



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Section 18.08.        MEMORANDUM
OF LEASE.  The Commission and Lessee
shall execute duplicate originals of a short form or memorandum of this Lease
(the “Memorandum”), in recordable
form, setting forth a description of the Real Estate, the Term, a description
of the Port, the easements granted hereunder, the provisions of Section 13.05
and any other portion of this Lease that the Commission or Lessee may request,
which instrument either party may have recorded in lieu of the recording of this
Lease.


[ The
balance of this page is intentionally left blank ]



 49
 









 


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


	
  

  	
   

  	
  INDIANA PORT COMMISSION (“Commission”)

  
	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Jay K. Potesta 

  	
   

  	
  By:

  	
  /s/ Steven R. Stemler 

  
	
   

  	
  Secretary — Treasurer

  	
   

  	
   

  	
  Steven R. Stemler, Designated Commissioner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AVENTINE RENEWABLE ENERGY-MT 

  
	
   

  	
   

  	
  VERNON, LLC (“Lessee”)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ John R. Gray 

  	
   

  	
  /s/ Ronald H. Miller 

  
	
  (Signature)

  	
   

  	
  (Signature)

  
	
   

  	
   

  	
   

  
	
   John R. Gray,
  VP Logistics and Development 

  	
   

  	
  Ronald H. Miller President & CEO 

  
	
  (Printed name
  and title)

  	
   

  	
  (Printed name
  and title)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Approved as to form and legality 

  	
   

  	
  APPROVED 

  
	
  This 19 day of January, 2007

  	
   

  	
  DATE: 1-24-07

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Susan W. Gard

  	
   

  	
  /s/ Mitchell E. Daniels, Jr. 

  
	
  For Steve Carter

  	
   

  	
   

  	
  For The Honorable Mitchell Daniels 

  	
   

  
	
   Attorney
  General of Indiana

  	
   

  	
   

  	
  Governor of Indiana

  	
   

  
							



 


This instrument was prepared jointly by David W. Haniford, General
Counsel Indiana Port Commission (Atty#7438-79) 150 W. Market St., Ste,
100, Indianapolis, IN  46204 (317)
232-9204; Mark D. Grant, Esq., ICE MILLER LLP, One American Square, Suite 3100,
Indianapolis, IN  46282-0200 (317)
236-2100; and Jeffrey I. Wool, Davis Polk & Wardell, 450 Lexington
Avenue, New York, NY  10017 (212)
450-4419.


 



 50














LIST OF EXHIBITS:


Exhibit A — Description
of Leased Premises

Exhibit A-1 — Description of the Port Property

Exhibit B — Port Tariff

Exhibit C — Project Specifications

Exhibit D — Declaration of Restrictions

Exhibit E — Addendum

Exhibit F — Description of Ethanol Process

Exhibit G — Description of Existing Preferential and Exclusive Rights


 
















EXHIBIT A


The Real Estate


 



 A-1















EXHIBIT A-1


Description of the Port Property


 



 A1-1















EXHIBIT B


Port Tariff, Rates, Charges,
Rules and Regulations


 



 B-1















EXHIBIT C


The Leased Premises


 



 C-1















EXHIBIT D


Declaration of Restrictions


 



 D-1















EXHIBIT E


(IPC3.21.06)


ADDENDUM


This Addendum is entered into by and between the Indiana Port
Commission (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 Lease
Agreement (“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.


1.             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.


2.             Compliance
with Laws.


A.                                   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 rules 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 formal modification.


B.                                     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 et seq., the regulations promulgated thereunder, and
Executive Order 04-08, dated April 27, 2004. 
If the contractor 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 Section 11.01(i) of the Agreement.  In addition, the Contractor may be subject to
penalties under Indiana Code § 4-2-6-12.


C.                                     The
Contractor certifies by entering into this Contract, that neither it nor its
principal(s) is presently in arrears in payment of its taxes, permit 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.



 E-1
 









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.


D.                                    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.


E.                                      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.


F.                                      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.


G.                                     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 termination of the Agreement and denial
of further work with the State, subject to the notice and cure provisions of
Section 11.01(i) of the Agreement.


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


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


(1)                                  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 24-4.7 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.


(2)                                  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 



 E-2
 









terms of IC 24-4.7 in the previous three hundred
sixty-five (365) days, 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.


3.             Conflict
of Interest.


A.                                   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.


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


C.                                     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.


D.                                    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.


4.             Drug-Free
Workplace Certification.


The Contractor hereby covenants and agrees to make a good faith effort
to provide and maintain a drug-free workplace. 
The Contractor will give written notice to the State within ten (10)
days after receiving actual notice that the Contractor or an employee of the
Contractor in the State of Indiana has been convicted of a criminal drug
violation occurring in the Contractor’s workplace.



 E-3
 









False certification or violation of this certification may result in
sanctions including suspension of contract payments, termination of this
Contract and/or debarment of contracting opportunities with the State for up to
three (3) years, subject to the notice and cure provisions of Section 11.01(i)
of the Agreement.


In addition to the provisions of the above paragraphs, if the total
contract amount set forth in this Contract is in excess of $25,000.00,
Contractor hereby further agrees that this contract is expressly subject to the
terms, conditions, and representations of the following certification:


This certification is required by Executive Order No. 90-5, April 12,
1990, issued by the Governor of Indiana. 
Pursuant to its delegated authority, the Indiana Department of
Administration is requiring the inclusion of this certification in all contracts
and grants from the State of Indiana in excess of $25,000.00.  No award of a contract shall be made, and no
contract, purchase order or agreement, the total amount of which exceeds
$25,000.00, shall be valid, unless and until this certification has been fully
executed by the Contractor and made a part of the contract or agreement as part
of the contract documents.


The Contractor certifies and agrees that it will provide a drug-free
workplace by:


A.                                   Publishing
and providing to all of its employees a statement notifying them that the
unlawful manufacture, distribution, dispensing, possession or use of a
controlled substance is prohibited in the Contractor’s workplace, and
specifying the actions that will be taken against employees for violations of
such prohibition;


B.                                     Establishing
a drug-free awareness program to inform it’s employees of (1) the dangers of
drug abuse in the workplace; (2) the Contractor’s policy of maintaining a  drug-free workplace; (3) any available drug
counseling, rehabilitation, and employee assistance programs; and (4) the
penalties that may be imposed upon an employee for drug abuse violations
occurring in the workplace;


C.                                     Notifying
all employees in the statement required by subparagraph (A) above that as a
condition of continued employment, the employee will (1) abide by the terms of
the statement; and (2) notify the Contractor of any criminal drug statute
conviction for a violation occurring in the workplace no later than five (5)
days after such conviction;


D.                                    Notifying
in writing the State within ten (10) days after receiving notice from an
employee under subdivision (C)(2) above, or otherwise receiving actual notice
of such conviction;


E.                                      Within
thirty (30) days after receiving notice under subdivision (C)(2) above of a
conviction, imposing the following sanctions or remedial measures on any
employee who is convicted of drug abuse violations occurring in the workplace:
(1) taking appropriate personnel action against the employee, up to and
including termination; or (2) requiring such employee to satisfactorily
participate in a drug abuse assistance or rehabilitation program approved for
such purposes by a federal, state or local health, law enforcement, or other
appropriate agency; and



 E-4
 









F.                                      Making
a good faith effort to maintain a drug-free workplace through the
implementation of subparagraphs (A) through (E) above.


5.             Nondiscrimination.


Pursuant to IC 22-9-1-10 and the Civil Rights Act of 1964, the
Contractor and its subcontractors shall not discriminate against any employee
or applicant for employment in the performance of this Contract.  The Contractor shall not discriminate with
respect to the hire, tenure, terms, conditions or privileges of employment or
any matter directly or indirectly related to employment, because of race,
color, religion, sex, disability, national origin or ancestry.  Breach of this covenant may be regarded as a
material breach of this Contract.  The
Contractor’s execution of this Contract also signifies compliance with
applicable federal laws, regulations, and executive orders prohibiting
discrimination in the provision of services based on race, color, national
origin, age, sex, disability or status as a veteran.  The provisions of this Section 5 are subject
to the notice and cure provisions of Section 11.01(i) of the Agreement.


NON-COLLUSION AND ACCEPTANCE


The undersigned attests, subject to the penalties for perjury, that
he/she is the Contractor, or that he/she is the properly authorized
representative, agent, member or officer of the Contractor, that he/she has
not, nor has any other member, employee, representative, agent or officer of
the Contractor, directly or indirectly, to the best of  his/her knowledge, entered into or offered to
enter into any combination, collusion or agreement to receive or pay, and that
he/she has not received or paid, any sum of money or other consideration for
the execution of this Contract other than that which appears upon the face of
this Contract.


[ The
balance of this page is intentionally left blank ]



 E-5
 









In Witness Whereof, the Parties
have, through duly authorized representatives, entered into this Lease.  The Parties having read and understand the
foregoing terms of the contract do by their respective signatures dated below
hereby agree to the terms thereof.


	
  Indiana Port Commission:

  By:                                                                                          

  Steven R. Stemler,

  Designated Commissioner



  Date:                                                                                       

  	
  Aventine Renewable Energy-Mt Vernon, LLC

  Signature:                                                                              



  Printed Name:                                                                       



  Title:                                                                                       



  Date:                                                                                       

  
	
   

  Attest:                                                                                    



  Printed Name:                                                                       



  Title:                                                                                       

   

  	
   

  
	
   

  	
   

  
	
  Office of the Attorney General

  	
  Office of the Governor

  
	
   

  	
   

  
	
                                                                                                  

  Steve Carter, Attorney General



  Date:                                                                                       

  	
                                                                                                  

  Mitchell E. Daniels, Jr., Governor



                                                                                  

  



 


 



 E-6















EXHIBIT F


Description of Ethanol Process


 



 F-1















EXHIBIT G


Description
of Existing Preferential and Exclusive Rights


 



 G-1