Exhibit 10.15


 


PREFERRED SUPPLY AGREEMENT


 


THIS PREFERRED SUPPLY AGREEMENT (this “Agreement”) is
made and entered into as of the 31st day of July, 2006 (the “Effective
Date”), by and between WESTWAY TRADING
CORPORATION, a Delaware corporation (“Westway”), and RENEWABLE ENERGY
GROUP, INC., a Delaware corporation, (“REG”).


 


R E C I T A L S


 


A.                                   WHEREAS, REG engages in the business of designing,
constructing, and operating manufacturing facilities that produce biodiesel
from soybean, palm and other oils and greases (the “Biodiesel Facilities”);


 


B.                                     WHEREAS, Westway and its affiliates engage in the
business of purchasing, transporting and selling oils, yellow grease, tallow
and other commodities that can be used for the production of biodiesel at the
Biodiesel Facilities; and


 


C.                                     WHEREAS, upon and subject to all the terms and
conditions set forth in this Agreement, Westway desires to sell, and REG
desires to purchase Raw Material Fats and Oils for use at the Managed
Facilities.


 


A G R E E M E N T


 


NOW, THEREFORE, in consideration of the foregoing
Recitals and the terms, covenants and conditions contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:


 


1.                                       DEFINITIONS.


 


In addition to the terms defined elsewhere
parenthetically in this agreement, the following words and expressions shall
have the meanings set forth below:


 


1.1                                 “Affiliate”
means, with respect to any person (the “first party”), any other person that
directly or indirectly controls, is controlled by, or is under common control
with the first party. For purposes of this definition, the term “controls,” “is
controlled by,” or “is under common control with” shall mean the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise.


 


1.2                                 “Bunge”
means Bunge North America, Inc.


 


1.3                                 “Forecast”
means a monthly rolling, good faith, non-binding forecast of the quantities of
Raw Material Fats and Oils that REG expects to request offers from Westway
during the next (6) months.


 


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1.4                                 “Raw
Material Fats and Oils” means any oils, yellow grease, tallow and other
commodities that can be used for the production of biodiesel at the Managed
Facilities, but excluding all soybean oil purchased by REG from West Central or
Bunge.


 


1.5                                 “Managed
Facilities” means (a) all Biodiesel Facilities owned by REG or its Affiliates
for such time during the Term that each is owned by REG or its Affiliates and
(b) all Biodiesel Facilities for which, through a management contract or
otherwise, REG has the right and/or the obligation to provide, purchase, or source
the Raw Material Fats and Oils used at such facility for such time during the
Term that REG has such right or obligation.


 


1.6                                 “Term”
shall mean five (5) years from the Effective Date; provided, however, that the
Term shall be extended automatically for successive periods of one year each
unless written notice of termination is given by either party to the other at
least one year prior to the expiration of such initial five year period or any
extension period.


 


1.7                                 “West
Central” means West Central Cooperative, an Iowa cooperative association.


 


2.                                       FORECASTS AND  PURCHASE OFFERS. 


 


2.1                                 Forecasts.
REG will deliver a Forecast to Westway during each calendar month during the
Term.


 


2.2                                 Westway
as a Preferred Provider. Westway, due to it’s position as a leading
worldwide trader of fats and oils, and it’s expertise as a worldwide supply
chain manager of fats and oils, may have available quantities of fats and oils
that will have economic value to REG that they would like to offer to REG. REG
desires to utilize Westway as a preferred provider of palm oil for their
Managed Facilities who may be using palm oil. REG desires to utilize Westway as
a preferred provider of tallow/yellow grease for Managed Facilities. REG also
desires to utilize Westway as a preferred provider for other imported vegetable
feedstocks for the Managed Facilities. REG will make requests for offers from
Westway for quantities of palm oil, animal fats or imported vegetable oils it
may purchase. REG will make requests for offers from Westway for quantities of
Raw Material Fats and Oils it wishes to purchase. These requests may be made
orally or by mail, email, and/or fax. REG will advise the time required for
Westway to have an offering communicated back to REG. REG will make every
attempt to allow for ample time such that the most economical offering may be
made. Any counters to the offering will be made under normal trading practices
and in good faith.


 


3.                                       PURCHASE AND SALE; SHIPMENT AND DELIVERY. 


 


3.1                                 Purchase
and Sale. Westway agrees to sell, and REG agrees to purchase (either for
its own account or for the account of its principal if applicable), all Raw
Material Fats and Oils set forth or referred to in each purchase order issued
by REG to Westway (a “Purchase Order”). The specifications, quantity, pricing,
shipping terms and other terms of each purchase and sale shall be in accordance
with the provisions of the applicable Purchase Order. In the event that any
provisions of any Purchase Order conflict with the provisions of this
Agreement, the provisions of this Agreement shall govern unless the parties 


 


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specifically agree otherwise in a writing signed by
both parties, which references the conflicting provision(s) of this Agreement.


 


3.2                                 Shrinkage.
Shrinkage will be negotiated as a normal trading component of a purchase and
sale.


 


3.3                                 Title and Risk of Loss. Risk of loss to the Raw Material Fats and Oils shall be
and shall remain with Westway until the Raw Material Fats and Oils are
delivered to a designated Managed Facility, or a carrier designated by REG. Title
shall remain in Westway until the Raw Material Fats and Oils are paid in full.


 


3.4                                 Record
Keeping. REG and Westway shall maintain complete and accurate records
regarding all Raw Material Fats and Oils purchased by REG hereunder for a
period of three years. Additionally, Westway shall gather samples of individual
shipments and retain such samples for one year from the date of shipment. Both
parties and their respective representatives and auditors shall have full
access during business hours to all such records and samples maintained by the
other party.


 


3.5                                 Invoicing.
Westway shall invoice REG upon delivery of Raw Material Fats and Oils to a
designated Managed Facility, or to a carrier designated by REG. REG shall pay
Westway thirty (30) days net from the date of invoice.


 


4.                                       WARRANTIES, REPRESENTATIONS, AND COVENANTS.


 


4.1                                 Corporate
Standing; Authority. Westway and REG each represent and warrant to the
other that it is duly organized, validly existing and in good standing under
the laws of the State in which incorporated, and that it has full corporate
power and authority to carry on the business presently being conducted by it
and to enter into and to perform its obligations under this Agreement.


 


4.2                                 Due
Authorization. Westway and REG each represent and warrant to the other that
it has taken all action necessary to authorize the execution and delivery of
this Agreement and the performance of each party’s respective obligations
hereunder. Each party’s officer executing this Agreement on its behalf has the
legal power, right and authority to bind the party to the terms and conditions
of this Agreement, and when he or she executes and delivers this Agreement and
any instruments contemplated herein, he or she will have the power, right and
authority to bind the party thereto.


 


4.3                                 No
Violation. Westway and REG each represent and warrant to the other that the
execution, delivery and performance of and compliance with this Agreement has
not resulted, and to the best of its knowledge will not result, in any
violation of, or be in conflict with, or constitute a material default under,
any contract, indenture, mortgage, agreement, instrument, franchise, permit,
license, judgment, decree, order, statute, rule or regulation applicable to it.


 


4.4                                 New
Managed Facilities. REG will notify Westway in writing upon the acquisition
of a Biodiesel Facility, commencement of construction of a Biodiesel Facility,
or the acquisition of the right and/or the obligation to provide, purchase, or
source the Raw Material Fats and Oils used at a Biodiesel Facility that meets
or will meet the definition of Managed Facility in Section 1.5 hereof.


 


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5.                                       DEFAULT; REMEDIES.


 


5.1                                 If
either Westway or REG defaults in the performance of any obligation under this
Agreement or any Purchase Order (except any payment obligation, with respect to
which no notice of default shall be required), the non-defaulting party shall
give the other party written notice to cure such default. If such default is
not cured within thirty (30) days after receipt of such notice, of if the
defaulting party fails to commence the
cure within such thirty (30) day period or to diligently pursue such cure to
completion, then the non-defaulting party may terminate this Agreement by
giving written notice of such termination to the defaulting party. Such
termination or default shall not waive any rights or claims of the terminating
party for damages it may be entitled to as a result of the other party’s breach
of this Agreement.


 


5.2                                 Liability
Limit. IN NO EVENT SHALL EITHER PARTY HERETO, THEIR RESPECTIVE AFFILIATES,
SUBSIDIARIES, AGENTS, EMPLOYEES, OFFICERS OR DIRECTORS BE LIABLE TO THE OTHER
FOR THE OTHER’S LOST PROFITS OR SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES
ARISING OUT OF OR IN CONNECTION WITH THE PERFORMANCE OR FAILURE OF PERFORMANCE
OF THIS AGREEMENT, HOWEVER ARISING, INCLUDING NEGLIGENCE.


 


6.                                       GENERAL  PROVISIONS.


 


6.1                                 Nature
of Relationship. The parties are entering into this Agreement as
independent contractors and no partnership, joint venture or other association
shall be deemed created by this Agreement. Neither party shall have the right
or authority to: (a) assume or create any obligation or responsibility, express
or implied, on behalf of the other party; or (b) represent the other party as
agent or in any other capacity.


 


6.2                                 Severability.
If any provision of this Agreement is or becomes or is deemed invalid, illegal
or unenforceable in any jurisdiction, such provision shall be deemed amended to
conform to applicable laws as to be valid and enforceable or, if it cannot be
so amended without materially altering the intention of the parties, it shall
be stricken and the remainder of this Agreement shall remain in full force and
effect.


 


6.3                                 Neutral
Interpretation. Each party has received independent legal advice from its
attorneys with respect to the advisability of executing this Agreement and the
meaning of the provisions hereof. The provisions of this Agreement shall be
construed as to their fair meaning, and not for or against any party based upon
any attribution to such party as the source of the language in question.


 


6.4                                 Successors
and Assigns; Assignment.


 


(a)                                  Except
as specifically allowed or required under subsection (b), (c) or (d) of this
Section 6.4, neither party shall assign (whether by contract or by law) any of
its rights or obligations under this Agreement without the prior written
consent of the other party.


 


(b)                                 REG
acknowledges that certain of Westway’s Affiliates, including, without
limitation, Safic Alcan, a joint stock company organized under the laws of
France, are also in the


 


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business of
purchasing, transporting and selling Raw Material Fats and Oils, and REG agrees
that the rights and obligations of Westway under this Agreement or any Purchase
Order may be exercised or fulfilled by either Westway or any Affiliate of
Westway.


 


(c)                                  If
either party transfers all or substantially all of its assets in whole or in
part to another entity, such agreement to transfer shall include a provision
requiring the assumption by the acquiring entity of this Agreement and
reasonably ensuring the continued effectiveness of this Agreement and its terms,
and reasonably ensuring the uninterrupted performance of this Agreement (but
such assurance need not include a requirement of posting any security). Upon
the assumption of this Agreement by an acquiring entity that is approved by the
other party to this Agreement, which approval shall not be unreasonably
withheld, the selling party shall be released from any further liability under
this Agreement. If the assignee is not approved by the other party in writing,
the assignment shall not relieve the selling party from any liability or
obligation under this Agreement.


 


(d)                                 A
merger or consolidation of either party with or into any other entity shall not
be deemed a breach of subsection (a) above. If either party formulates a plan
to liquidate or merge with or into any other entity, or becomes aware of a plan
or intent by another entity to seek to acquire such party, then such party
shall deliver to the other reasonable advance notification thereof, if possible
without breaching any obligation of confidentiality.


 


6.5                                 Confidentiality.
Westway and REG each agree to keep confidential any information they may
receive during the term of this Agreement concerning their respective products,
purchases, pricing or other similar information (the “Confidential Information”).
Confidential Information shall not include any information which (i) is or
becomes generally available to the public by publication or otherwise through
no fault of the party who is the recipient of the information, (ii) was in a
party’s possession prior to the date of disclosure to that party and not
previously supplied by, or obtained from, the other party; or (iii) is supplied
to a party by a third party who is not known to be subject to any contractual
or fiduciary obligation to treat such information as confidential. The parties
shall keep the Confidential Information strictly confidential and shall not use
or divulge the Confidential Information except consistently with the purposes
of this Agreement, and except to its officers, directors, employees,
contractors, Affiliates and representatives who need to know such Confidential
Information for purposes of this Agreement. These obligations of
confidentiality shall survive the termination or expiration of this Agreement
for a period of one (1) year.


 


6.6                                 Governing
Law. This Agreement shall be governed by, construed and enforced in
accordance with the laws of Delaware, without regard to its conflict of law
provisions.


 


6.7                                 Jurisdiction;
Service of Process. Any claim, action, lawsuit, or other proceeding arising
out of or relating to this Agreement (each, a “Proceeding”) may be brought in
the courts of the State of Delaware, County of New Castle, or, if it has or can
acquire jurisdiction, in the United States District Court for the District of
Delaware, and each of the parties irrevocably submits to the exclusive
jurisdiction of each such court in any such Proceeding, waives any objection it
may now or hereafter have to venue or to convenience of forum, agrees that all
claims in respect of the Proceeding shall be heard and determined only in any
such court and agrees not to bring any Proceeding arising out of or relating to
this Agreement in any other court. The parties agree that either or both of
them may file a


 


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copy of this paragraph with any court as written
evidence of the knowing, voluntary and bargained agreement between the parties
irrevocably to waive any objections to venue or to convenience of forum. Process
in any Proceeding referred to in the first sentence of this section may be
served on any party anywhere in the world.


 


6.8                                 Entire
Agreement; Amendments; Conflicts. This Agreement constitutes and contains
the entire agreement of the parties, and supersedes any and all prior or
contemporaneous negotiations, correspondence, understandings and agreements
between the parties, written or oral, respecting the subject matter hereof.


 


6.9                                 Waiver
and Amendment. No waiver, amendment, modification or change of any
provision of this Agreement shall be effective unless and until made in writing
and signed by all of the parties hereto. No waiver, forbearance of failure by
any party hereto of its right to enforce any provision of this Agreement shall
constitute a waiver or estoppel of such party’s right to enforce any other
provision of this Agreement or a continuing waiver by such party of compliance
with any provision.


 


6.10                           Cooperation.
Each party hereto shall cooperate with the other party hereto and shall take
such further action and shall execute and deliver such further documents as may
be necessary or desirable in order to carry out the provisions and purposes of
this Agreement.


 


6.11                           Notices.
Except as otherwise expressly provided with respect to Purchase Orders, any
notice, request, claim or other communication required to be given pursuant to
this Agreement shall be in writing and shall be either: (i) delivered
personally to the party to be notified, (ii) sent by registered or certified
United States Mail, first-class postage prepaid, return receipt requested, to
the party to be notified at such party’s address specified below, (iii)
delivered by an overnight delivery courier service to the party to be notified
at such party’s address specified below, or (iv) transmitted by facsimile to
the party to be notified at such party’s facsimile number specified below
provided that a copy is sent the same day by an overnight delivery courier
service to such party:


 


	
  If to
  REG, to:

   

  Renewable Energy
  Group, Inc.

  406 First
  Street, PO Box 128,

  Ralston, Iowa

  Attn.:  Chief Executive Officer

  Telephone:  (712) 667-3321

  Fax:  (712) 667-3376

  	
  With a
  copy to:

   

  Wilcox Polking
  Gerken Schwartzkopf & Copeland, P.C.

  115 E. Lincolnway
  Street, Suite 200

  Jefferson, Iowa

  Attn: John A. Gerken,
  Esq.

  Telephone No.:  515-386-3158

  Facsimile No.:  515-386-8531

  



 


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  If to
  Westway, to:

   

  A. Whitfield
  Huguley, IV

  Westway Trading
  Corporation

  365 Canal
  Street, Suite 2900

  New Orleans,
  Louisiana  70130

  Telephone:  (504) 525-9741

  Fax:  (504) 522-1638

  	
  With a
  copy to:

   

  Scott T.
  Whittaker, Esq.

  Stone Pigman
  Walther Wittmann, L.L.C.

  546 Carondelet
  Street

  New Orleans,
  LA  70130

  Telephone: (504)
  593-0836

  Fax: (504)
  596-0836

  



 


Any such notice shall be deemed to have been given as
of the earlier of: (a) the date of actual receipt of such notice, or (b) the
fifth business day following the date on which the mail containing such notice
is posted if sent by certified or registered United States Mail, or (c) the
second business day after such notice is timely delivered to an overnight
delivery courier service for delivery to the address specified above for the
party to be notified, or (d) the date of the confirmed transmission of any
notice by facsimile. Any party to this Agreement may designate a different
address or facsimile number to which notices are to be sent to such party by
notifying all other parties to this Agreement as to such different address or
facsimile number in the manner set forth above in this Section.


 


6.12                           Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall
be deemed to be an original, but all of which together shall constitute one and
the same instrument.


 


6.13                           Exhibits
and Schedules. All exhibits and schedules to which reference is made in
this Agreement are deemed to be incorporated by reference into this Agreement,
whether or not actually attached hereto.


 


6.14                           Force
Majeure. Either party shall be temporarily excused from performance under
this Agreement if any force majeure, including but not limited to disaster,
fire, war, civil commotion, strike, labor shortage, slowdown, or the
unavailability of labor, governmental regulation, energy shortage, or other
occurrence beyond the reasonable control of such party should have happened and
made it impossible for such party to perform its obligations under this
Agreement. Under such circumstances, performance under this Agreement that
relates to the delay shall be suspended for the duration of the delay, provided
that the party so affected resumes the performance of its obligations with due
diligence as soon as practicable after the effects of such event have been
alleviated provided that no such event shall relieve REG from any of its
payment obligations hereunder. In case of any such suspension, the parties
shall use their best efforts to overcome the cause and effect of such
suspension, but in no event shall either party be required to settle any
litigation, strike, lockout or other labor difficulty contrary to its best
interests in its sole discretion.


 


[Signatures
follow]


 


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IN WITNESS WHEREOF the parties have executed this
Agreement as of the dates below their respective signatures, effective as of
the Effective Date.


 


	
   

  	
  WESTWAY
  TRADING CORPORATION

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
      /s/
  ANTHONY R. WATTS

  	
   

  
	
   

  	
  Name:

  	
  Anthony R. Watts

  
	
   

  	
  Title:

  	
  Authorized
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
  RENEWABLE
  ENERGY GROUP, INC.

  
	
   

  	
  a Delaware
  corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
      /s/
  JEFFREY STROBURG

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
						



 


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