ex_1035.htm

Exhibit 10.35

    SECOND AMENDMENT
TO

    ANHYDROUS AMMONIA SALES
AGREEMENT*

    


    THIS SECOND AMENDMENT TO ANHYDROUS
AMMONIA SALES AGREEMENT (this “Second Amendment”) is dated February 23, 2010, by
and between Koch Nitrogen International Sàrl (“Seller”), and El Dorado Chemical
Company (“Buyer”).

    


    WHEREAS, Seller and Buyer are
parties to that certain Anhydrous Ammonia Sales Agreement dated December 3, 2008
with an effective date of January 1, 2009, as amended by the First Amendment to
Anhydrous Ammonia Sales Agreement dated June 25, 2009 (collectively, the
“Agreement”), and Buyer and Seller mutually desire to further amend the
Agreement as hereinafter provided.

    


    NOW, THEREFORE, in
consideration of the mutual covenants and premises herein set forth and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:

    


    1.    DEFINITIONS.  Any
capitalized term not defined herein shall have the meaning given to such term in
the Agreement.

    


    2.    PRODUCT
REQUIREMENTS.  Effective March
1, 2010, the definition of Product Requirements in Section P of Article I shall
be deleted in its entirety and replaced with the following:

    


    
      	
               
      

            	
              “P.  Product
      Requirements shall mean the total Product purchased by Buyer for Buyer’s
      account for further processing at Buyer’s Facility, as adjusted to
      accommodate Buyer’s Railcar or Truck Product Requirements (as defined
      below).  Currently, the Product Requirements during a calendar
      year at Buyer’s Facility are approximately 165,000 to 175,000 short tons,
      which includes approximately 60,000 short tons used by Buyer to
      manufacture finished product on behalf of Orica International Pte Ltd. or
      its affiliates, but is exclusive of any tolling arrangements by Buyer with
      third parties.  Product Requirements shall not include
      approximately 60,000 additional short tons of anhydrous ammonia annually,
      for production of finished products for Orica International Pte Ltd. or
      its affiliates.  The 60,000 additional short tons referenced
      above shall be excluded from the Product Requirements during the Term of
      this Agreement, unless Buyer requests and Seller elects, at Seller’s sole
      option, to include such quantity in the Product
      Requirements.  Provided that Buyer has given Seller at least
      sixty (60) days prior written notice, Product Requirements shall not
      include Product supplied to Buyer’s Facility which shall be produced by
      Buyer or an Affiliate of Buyer and physically delivered to Buyer’s
      Facility.”

            


    

    


    3.    TERM.  Effective
March 1, 2010, Section A of Article II TERM shall be deleted in its entirety and
replaced with the following:

    


    
      	
               
      

            	
              “A.  Term.  The
      term of this Agreement (the “Term”) shall commence at 12:01 a.m. central
      time on January 1, 2009 and shall terminate at 11:59 p.m. on December 31,
      2012 (“Original 

            


    

     

    
      


      
        
          
             *INFORMATION
IN THIS DOCUMENT HAS BEEN OMITTED FROM THIS PUBLIC FILING PURSUANT TO A REQUEST
BY THE COMPANY FOR CONFIDENTIAL TREATMENT BY THE SECURITIES AND EXCHANGE
COMMISSION. THE OMITTED INFORMATION HAS BEEN FILED SEPARATELY WITH THE SECRETARY
OF THE SECURITIES AND EXCHANGE COMMISSION FOR PURPOSES OF SUCH
REQUEST

          

          
             
1

            
              

            

          

          
             


          

        

      

      
Termination Date”) unless otherwise terminated earlier in
accordance with this Agreement or extended pursuant to Section B
below.”


    

    4.           QUANTITY.  Effective
March 1, 2010, Section A of Article III QUANTITY shall be deleted in its
entirety and replaced with the following:

    “A.  Quantity.  During
the Term, Buyer shall purchase from Seller one hundred percent (100%) of its
Product Requirements for Buyer’s Facility.  However, in the event
Buyer installs railcar or truck unloading capabilities at Buyer’s Facility, then
Buyer shall have the option to purchase up to twelve percent (12%) of Buyer’s
Product Requirements during a calendar year from a third party (“Railcar or
Truck Product Requirements”); provided such Railcar or Truck Product
Requirements must be delivered to Buyer’s Facility by railcar or
truck.  Railcar or Truck Product Requirements shall not exceed 4,000
short tons in any given calendar month.”

    


    5.           QUANTITY.  Effective
March 1, 2010, Section C of Article III QUANTITY, shall be deleted in its
entirety and replaced with the following:

    “C.  Measurement.  The
quantity of Product delivered hereunder to Buyer by the Ammonia Pipeline shall
be governed by the weights and measures taken by meters owned by the Ammonia
Pipeline at the Delivery Point pursuant to the Ammonia Pipeline
Tariff.  For truck or rail deliveries, the quantity of Product
delivered to Buyer shall be governed by the weights and measures taken as the
trucks or railcars are loaded at the KNC Facility, KNC Terminal, alternative
Seller supply sources, or at an alternative third party supply source and as
stated on the bill of lading.  The foregoing measurements of said
quantities shall be final and conclusive, unless proven to be in
error.  For purposes of clarity, Buyer further agrees that (i)
measurements taken from Ammonia Pipeline’s meter shall govern over measurements
taken from Buyer’s pipeline or other meter; and (ii) differences between the
Ammonia Pipeline’s meter and Buyer’s meter are expected and Buyer shall not
claim the Ammonia Pipeline’s meter is inaccurate solely because the measurement
taken from such meter is different from Buyer’s meter.  In no event
shall Seller be responsible for any difference in the metered quantity of
Product between the Ammonia Pipeline’s meter and Buyer’s pipeline
meter.”

    


    6.    ADDER.  Effective March
1, 2010, Section B of Article VI PRICE shall be deleted in its entirety and
replaced with the following:

    
      	
               
      

            	
              “B.
      Adder.  Adder
      shall equal *** per short ton.  However, if the Ammonia
      Pipeline Transportation Charge is modified as set forth in Article VI
      Section C. of the Agreement, the Parties agree to modify the Adder as set
      forth in Article VI Section C.”

            


    

    


    7.    NOTICES.  Effective March
1, 2010, Section A of Article VIII DELIVERY shall be deleted in its entirety and
replaced with the following:

    
      	
               
      

            	
              “A.  Notices.  Buyer
      shall provide Seller a delivery schedule ten (10) days prior to the Month
      of delivery (“Current Monthly Forecast”).  Subject to the
      remainder of this paragraph, Seller shall deliver Product to Buyer in
      daily quantities during the Month based on the Current Monthly
      Forecast.  Buyer will use commercially reasonable efforts to
      make the Current Monthly Forecast firm and to not change the Current
      Monthly Forecast.  Seller acknowledges, however, that Buyer's
      Current Monthly Forecasts are based on the forecast accuracy of Buyer's
      customers

            


    


    
      
         ***INDICATES
CERTAIN INFORMATION IN THIS DOCUMENT WHICH HAS BEEN OMITTED FROM THIS PUBLIC
FILING PURSUANT TO A REQUEST BY THE COMPANY FOR CONFIDENTIAL TREATMENT BY THE
SECURITIES AND EXCHANGE COMMISSION. THE OMITTED INFORMATION HAS BEEN FILED
SEPARATELY WITH THE SECRETARY OF THE SECURITIES AND EXCHANGE COMMISSION FOR
PURPOSES OF SUCH REQUEST

      

      
         
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    and that
Buyer is unable to predict changes that may occur relative to certain customers’
demand.  Buyer may make corresponding changes to the delivery volumes
and schedule shown in the Current Monthly Forecast.  Seller shall use
commercially reasonable efforts to meet any such changes to Buyer’s delivery
schedule.  Buyer shall also provide Seller with weekly delivery
schedule updates.  In addition, if after Buyer has provided a Current
Monthly Forecast for a Month, and after the first day of such Month Buyer
decides to purchase Railcar or Truck Product Requirements for such Month, the
volume of such Railcar or Truck Product Requirements cannot change the
applicable Current Monthly Forecast unless Buyer has provided Seller with at
least 15 days prior written notice.”

    


    8.    CONFIDENTIALITY.
 Effective March 1, 2010, Article XVI. shall be deleted in its
entirety and replaced with the following:

    


    "Except
(i) as may be agreed to in writing on a case by case basis, (ii) for
communication between Buyer and Orica International Pte Ltd., (iii) as may be
necessary to perform its obligations herein, or (iv) as required by law, both
Parties shall maintain in confidence all information concerning costs and prices
to be disclosed in connection with each other's performance under this
Agreement.  Such information shall be disclosed to no one other than
affiliates, officers and other employees who need to know the same in connection
with performance under this Agreement, and such affiliates, officers and other
employees shall be advised of the confidential nature of such information, or
when disclosure is required by law.  The Parties shall take all proper
precautions to prevent such information from being acquired by any unauthorized
person or entity."

    


    9.    RATIFICATION
OF AGREEMENT.  Except as expressly amended herein, the terms,
covenants and conditions of the Agreement shall remain in full force and effect
without modification or amendment, and the parties hereto ratify and reaffirm
the same in its entirety.

    


    10.              MISCELLANEOUS.  This
Second Amendment shall be governed by and construed in accordance with the
governing law set forth in the Agreement, without regard to the conflicts of
laws principles.  In the event that the terms of the Agreement
conflict or are inconsistent with those of this Second Amendment, the terms of
this Second Amendment shall govern.  The provisions of this Second
Amendment shall be binding upon, and shall inure to the benefit of, the parties
hereto and each of their respective representatives, successors, and
assigns.  This Second Amendment may be executed in counterparts, each
of which shall be deemed an original and both of which together shall constitute
one and the same agreement.


    
      
         


      

      
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    IN WITNESS WHEREOF, the
parties have caused this Second Amendment to be effective on the day and year
first written above.

    


    


    


    Koch
Nitrogen International Sàrl             El Dorado Chemical
Company

    


    By:
/s/ C. Walker
Hess                 By:  /s/Tony M.
Shelby 

    Name:  C.
Walker Hess                  Name:  Tony M.
Shelby

    Title:  Managing
Director                  
Title:  Vice President


    
      
         


      

      
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