Exhibit
10.1


 


Confidential Treatment Requested. 
Confidential portions of this document have been redacted and have been
separately filed with the Commission.


 


BLACKHAWK BIOFUELS, LLC TOLL PROCESSING AGREEMENT


 


This Blackhawk Biofuels, LLC Toll Processing Agreement
(the “Agreement”) is made and entered into effective August 5, 2009, by
and between Blackhawk Biofuels, LLC a limited liability company organized and
existing under the laws of the state of Delaware, with offices at 22 South
Chicago Avenue, Freeport, Illinois 61032 (“Blackhawk Biofuels”). and REG
Marketing & Logistics Group, LLC, an Iowa limited liability company (“REG
Marketing”), of 416 S. Bell Avenue, PO Box 888, Ames, Iowa 50010 (each a “Party,”
and collectively the “Parties”).


 


Recitals


 


A.                                   Blackhawk
Biofuels is in the business of manufacturing and processing biodiesel from
feedstock at its biodiesel processing facility located at Danville, IL (the “Facility”).


 


B.                                     REG Marketing
desires to arrange for the purchase and delivery of animal fats and other
feedstocks (as specified by the provisions of Section 7 hereafter, herein “Feedstocks”)
to Blackhawk Biofuels for processing into biodiesel meeting the specifications
set out in Section 8 hereafter (herein “Biodiesel”) and Crude Glycerin,
Fatty Acids and Soapstock (“Co-products”) pursuant to a toll processing
arrangement.  Blackhawk Biofuels desires
that REG Marketing arrange for the delivery of Feedstocks for processing at the
Facility.


 


The Agreement


 


In
consideration of the mutual benefits and obligations herein provided and other
good and valuable consideration, Blackhawk Biofuels and REG Marketing agree as
follows:


 


1.                                       Offers to Deliver Feedstocks for Processing.  REG Marketing may
offer to deliver Feedstocks to Blackhawk Biofuels’s Facility at Danville, IL,
during the term of this Agreement.


 


(a)                                  Orders within Facility Commitment.  REG Marketing shall
order the processing of 11.0 million pounds of Feedstocks at the Facility (“Facility
Commitment”). Any such order shall set out the type and quantity of Feedstocks,
and the Production Week for which such Feedstocks are intended for processing (“Order”).  If such Order is timely made, then unless
otherwise agreed by the Parties REG Marketing shall deliver the Feedstocks to
Blackhawk Biofuels in time for production of the Biodiesel, Blackhawk Biofuels
shall process the Feedstocks and test and certify the Biodiesel as meeting the
agreed upon specifications under the applicable Order during such Production
Week, and REG Marketing shall arrange to pick up the resulting Biodiesel during
the two weeks immediately following such Production Week.  Blackhawk Biofuels agrees to provide written
acknowledgment of all Orders placed by REG Marketing.  For purposes of this Agreement, a “Production
Week” shall mean a calendar week beginning at 8:00 a.m. on Monday and
ending at 7:59 a.m. on the following Monday, with weeks designated for
pick up of Biodiesel measured in similar fashion.


 


1

















 


As
an example, for the Production Week commencing January 19, 2009, REG
Marketing would need to have delivered its Order for such Production Week on or
before 5:00 p.m. on Monday, January 5, 2009.  If such Order has been timely delivered to
Blackhawk Biofuels, REG Marketing would then deliver in the Feedstocks required
for such Production Week both before and during the production week.  Blackhawk Biofuels would then have the
Production Week of January 19 through January 26, 2009, to complete
production, test and certify the Biodiesel meets the agreed upon specifications
under the applicable Order.  REG
Marketing would then have from January 26 through 7:59 a.m. on February 9,
2009, to pick up the Biodiesel produced for such Production Week.  REG Marketing shall develop a sample “Order/Nomination”
form to be used by the Parties, which shall be attached as Exhibit A
hereto.


 


Any Feedstocks purchased by Bunge North
America, Inc. (“Bunge”) pursuant to the terms of a Feedstock Purchase and
Sale Agreement dated June 30, 2009 (the “Feedstock Agreement”) by and
between Blackhawk Biofuels, REG Marketing and Bunge shall be included in
determining whether the Facility Commitment has been met.  Any purchase of Feedstocks by Bunge, however,
shall be governed exclusively by the terms of the Feedstock Agreement and such
purchases shall not be subject to the terms of this Agreement.


 


(b)                                 Offers in Excess of the Facility Commitment.  REG Marketing may
offer to deliver additional Feedstocks beyond the Facility Commitment, subject
to Blackhawk Biofuels’s acceptance.  Any
such offer (“Nomination”) shall set out the type and quantity of Feedstocks,
the Production Week for which such Feedstocks are intended for production, and
advise of the time period during which Blackhawk Biofuels shall be required to
communicate Blackhawk Biofuels’s acceptance back to REG Marketing (“Offer
Period”).  The parties agree that such
Offer Period will not expire prior to 12:00 o’clock noon, local time at the
Facility, on the business day following that day during which the Nomination is
delivered, and provided further that (unless waived by Blackhawk Biofuels) a
Nomination shall not propose a Feedstocks delivery schedule with first delivery
date less than seven (7) calendar days after the end of the Offer
Period.  If a Nomination is accepted by
Blackhawk Biofuels (as set out hereafter), then (unless otherwise agreed by the
Parties) REG Marketing agrees to deliver the Feedstocks to Blackhawk Biofuels
pursuant to the terms of the Nomination prior to such Production Week to
utilize in the production of the Biodiesel, Blackhawk Biofuels shall during
such Production Week process the Feedstocks and test and certify the Biodiesel
as meeting the agreed upon specifications under the applicable Nomination, and
REG Marketing shall arrange to pick up the resulting Biodiesel during the two
weeks immediately following such Production Week.  The sample “Order/Nomination” form to be used
by the Parties is attached as Exhibit A hereto.


 


2

















 


*** Confidential
material redacted and filed separately with the Commission.


 


2.                                       Agreement to Process Orders; Consideration of Nominations.


 


(a)                                  Orders within Facility Commitment. Blackhawk Biofuels agrees to process Feedstocks for all
Orders received totaling up to 2.75 million pounds per Production Week, such
processing to be within the time frame as set out in Section 1(a) above
(unless otherwise agreed by the Parties). 
Blackhawk and REG Marketing agree that any shortfall in biodiesel
production or shipments due in the previous Agreement dated July 1st, 2009
may be made up under this Agreement without penalties.


 


(b)                                 Nominations in Excess of Facility Commitment.  In addition, should
REG Marketing offer to deliver Feedstocks in excess of such Facility
Commitment, Blackhawk Biofuels will consider any such Nomination received, and
shall have the right (but not any obligation) to accept Nominations received
from REG Marketing by notice given during the Offer Period.  If Blackhawk Biofuels gives timely acceptance
of a Nomination (pursuant to the provisions set out in this Agreement, herein
an “Acceptance”), then Blackhawk Biofuels agrees to process Feedstocks received
pursuant to the terms of the Nomination (and such other applicable provisions
as set out herein).


 


3.                                       Manner of Extending Order, Nominations, Acceptances.  Notwithstanding any
provisions of Section 26(a) to the contrary, the Parties may submit
Orders, Nominations and Acceptances by telephone or email, provided that any
Order, Nomination or Acceptance submitted by telephone must be followed by
timely confirmation by email.


 


4.                                       Toll Fees and Payment.  Blackhawk Biofuels shall be paid a toll fee
of $ *** for every gallon of Biodiesel at standard temperature and pressure
delivered to REG Marketing, produced at the Facility from the Feedstocks
delivered by REG Marketing for all volumes shipped up to 2,500,000 gallons in a
calendar month. Blackhawk Biofuels shall be paid a toll fee of $ *** for every
gallon of Biodiesel at standard temperature and pressure delivered to REG
Marketing, produced at the Facility from the Feedstocks delivered by REG
Marketing for all volumes shipped in excess of 2,500,000 gallons in a calendar
month. Payment shall be made as follows:


 


(a)                                  The toll Fee under the terms of such Orders or Nominations
by wired funds to Blackhawk Biofuels on the first business day following the 15th for Biodiesel
delivered to REG Marketing from the 1st to the 15th of the month and on
the first business day following the last day of each month for Biodiesel
delivered to REG Marketing on the 16th to the last day of
the month. Delivered to REG Marketing shall mean Biodiesel meeting
specifications loaded per shipping instructions FOB Danville, IL.


 


5.                                       Co-Products.  REG Marketing shall also be entitled to
receive at no additional cost, all glycerin and Fatty Acid produced as a result
of the processing of the Feedstocks.


 


3

















 


*** Confidential material redacted and filed separately
with the Commission.


 


6.                                       Methanol and Catalyst.  REG Marketing shall be responsible for the purchase and
delivery of methanol and catalyst to the Facility. The maximum allowed usage of
methanol shall be *** gal of methanol per gallon of biodiesel. The maximum
allowed usage of catalyst shall be *** lbs per gallon of biodiesel. Blackhawk
Biofuels will reimburse REG Marketing for usage of methanol and catalyst above
the maximums. The reimbursement will be paid for overusage at the average price of
the chemicals multiplied by the overusage amount based on the biodiesel
produced on a monthly basis.  REG
Marketing will invoice Blackhawk Biofuels within the first week of the
following month.  Payment terms will be 7
days from receipt of invoice from REG Marketing.  If the actual positive or negative usage variance
performance is greater than 10% from the values given above, the parties will
use data gathered while producing under steady state conditions and adjust the
maximum allowed usages with approval to not be unreasonably withheld,
conditioned or delayed by either party. 
Any changes will be contained in an addendum to this Agreement.


 


7.                                       Maximum Feedstock Usage and Overusage.  In consideration of
the Toll Fee and handling of co-products agreed upon, Blackhawk Biofuels agrees
the Maximum Feedstock Usage(MFU) per Pound of Delivered Biodiesel shall be as
defined in Exhibit B for each Feedstock Type.


 


For feedstocks where a MFU value is
clearly identified and not calculated, the actual overuse, if any, will be
calculated as follows:


 


Overusage based on identified
MCU = A – ( B x MFU)


 


	
  Where

  	
  A = Actual pounds of
  Feedstock delivered from aggregate BOL’s

  
	
   

  	
   

  
	
   

  	
  B = Biodiesel produced
  from Feedstock in gallons at standard conditions

  
	
   

  	
   

  
	
   

  	
  MCU
  = defined value for feedstock type

  



 


For higher FFA feedstocks or blends of
feedstocks that do not have an identified MFU and require the calculation, a
daily flow proportioned representative composite sample shall be tested and the
resulting %FFA will be used in the calculation. for MFU for the resulting
production volume.  For feedstocks where
a MFU value is calculated and not clearly identified, the actual overuse, if
any, will be calculated as follows:


 


Overusage
for High FFA and Blends based on MCU calculation = C – (B x MFU)


 


	
  Where

  	
  C = Actual pounds of
  Feedstock delivered from aggregate BOL’s

  
	
   

  	
   

  
	
   

  	
  B = Biodiesel produced
  from Feedstock in gallons at standard conditions

  
	
   

  	
   

  
	
   

  	
  MFU = “Exhibit B calculation *1”
  using daily flow proportioned representative composite sample

  



 


The reimbursement will be paid for overusage at the
average price of the feedstock multiplied by the overusage amount based on the
biodiesel produced on a monthly basis. 
REG Marketing will invoice Blackhawk Biofuels within the first week of
the following month.  Payment terms will 


 


4





















 


be 7 days
from receipt of invoice from REG Marketing. 
If the actual positive or negative usage variance performance is greater
than 2% from the values given or calculated in Exhibit B, the parties will
use data gathered while producing under steady state conditions and adjust the
defined MFU or formula “*1” with approval to not be unreasonably withheld,
conditioned or delayed by either party. 
Any changes will be contained in an addendum to this Agreement.


 


8.                                       Feedstocks.  The Feedstocks to be delivered to the
Facility pursuant to this Agreement shall comply with the specifications set
forth on Exhibit B attached hereto or the specific purchase order,
whichever is the more restrictive specification.  For Example, if the tallow specification for
FFA in Exhibit B was <4 and the purchase order defined FFA as less than
<2, then <2 shall be the requirement. 
Prior to accepting deliveries of Feedstocks, Blackhawk Biofuels shall
have the right at its expense to inspect and test the tendered Feedstocks to
determine if it meets the specifications required under this Agreement, and if
any such Feedstocks does not meet the required specifications then Blackhawk
Biofuels shall have the right to reject such Feedstocks and require REG
Marketing, at its cost, to replace the same with Feedstocks that meets the
required specifications.  Should REG
Marketing propose any other type of Feedstocks other than identified on Exhibit B,
the Parties shall agree upon the written specifications and MFU applicable to such
additional feedstock, and approve and attach such specifications and MFU as an
addendum to Exhibit B with approval to not be unreasonably withheld,
conditioned or delayed by either party.


 


9.                                       Biodiesel.  The Biodiesel to be produced pursuant to this
Agreement shall comply with the specifications set forth on Exhibit C
attached hereto.  At REG Marketing’s
request, two (2) - one (1) litre samples of the Biodiesel to be
delivered to REG Marketing by Blackhawk Biofuels shall be made available for
testing at REG Marketing’s cost, prior to REG Marketing picking up such
Biodiesel.  Should inspection and testing
determine that any Biodiesel does not meet the required specifications (whether
determined before or after such Biodiesel has been picked up by REG Marketing,
and including after delivery to REG Marketing’s customers), REG Marketing shall
have the right to reject such Biodiesel, and require Blackhawk Biofuels, at its
cost, to replace the same with Biodiesel that meets the required
specifications.


 


10.                                 Term.  The term of this Agreement shall be until August 31th,
2009 and commence upon its signature by the Parties.


 


11.                                 Title.  Except as otherwise provided herein, title to
the Feedstocks delivered by REG Marketing pursuant to this Agreement and title
to the contractual amount of corresponding Biodiesel and Co-products produced
from such Feedstocks shall at all times be and remain with REG Marketing.  Any Feedstocks delivered by REG Marketing
pursuant to the terms and conditions of the Feedstock Agreement, however, shall
at all times be and remain with Bunge until such time as title to such
Feedstocks passes to REG Marketing pursuant to the terms of the Feedstock
Agreement.


 


12.                                 Risk of Loss; Insurance.  Risk of loss to the Feedstocks and the
Biodiesel and Co-Products produced therefrom shall at all times be borne by REG
Marketing, and REG Marketing will maintain such property insurance on the
Feedstocks and the Biodiesel produced therefrom as REG Marketing shall
determine, in its sole discretion.


 


5





















 


Blackhawk Biofuels and REG
Marketing shall each, at its own cost and expense, obtain and maintain, during
the term of this Agreement, comprehensive general liability insurance, in
minimum amounts of Five Million Dollars ($5,000,000) per occurrence for damage,
injury and/or death to persons, and One Million Dollars ($1,000,000) per
occurrence for damage and/or injury to property and Worker’s Compensation
Insurance as required by law.  Such
coverage shall be on a date of occurrence form, and be provided by an insurance
company reasonably satisfactory to the other Party.  Blackhawk Biofuels and REG Marketing shall
each provide the other with proof of such insurance coverage prior to any
Feedstocks being delivered, such insurance naming the other Party as an
additional insured, and providing that the coverage represented thereby shall
not be canceled nor modified unless at least thirty (30) days prior written
notice has been given to the additional insured.


 


13.                                 Inventory Reports.  Blackhawk Biofuels will provide REG Marketing
with daily reports showing the receipt, usage and inventory of Feedstocks,
methanol and catalyst, and shipments, production and inventory of Biodiesel and
Co-products produced.


 


14.                                 Production Costs.  Other than for the cost of the Feedstocks,
methanol, and catalyst purchased and delivered by REG Marketing, Blackhawk
Biofuels shall be responsible for all costs of producing the Biodiesel required
under this Agreement, including without limitation all labor costs and the cost
of utilities, chemicals other than methanol and catalyst and other consumables
used in such production.


 


15.                                 Testing.  Blackhawk Biofuels shall be responsible for
the cost of testing to fully certify the Biodiesel meets the specifications
identified in the Order or Nomination. 
All sampling and testing shall be in conformance with BQ-9000 rules and
regulations.


 


16.                                 Freight Costs.  REG Marketing will bear the cost of all
freight charges for the Feedstocks, methanol, and catalyst purchased by REG
Marketing, and Biodiesel and Co-Products to be produced therefrom, pursuant to
this Agreement.


 


17.                                 Protection of REG Marketing’s Title.  In order to better
evidence REG Marketing’s ownership of the Feedstocks and the Biodiesel produced
therefrom, Blackhawk Biofuels hereby authorizes REG Marketing on its behalf, at
any time and from time to time to file protective financing statements in any
Uniform Commercial Code jurisdiction, which may include without limitation any
initial financing statements and amendments thereto that (i) describe the
Feedstocks, and the Biodiesel that is the subject of this Agreement, and (ii) contain
any other information required or appropriate to be included pursuant to the
Uniform Commercial Code of the state where filed, including that the
organizational identification number of Blackhawk Biofuels is 20-2760722.  Blackhawk Biofuels agrees to furnish any such
information to REG Marketing promptly upon request.  Blackhawk Biofuels will not purport to
pledge, mortgage or create, or suffer to exist a security interest in the
Feedstocks and the Biodiesel that is produced therefrom, in favor of any third
party, and Blackhawk Biofuels, upon the request of REG Marketing or in response
to any inquiry that may be made, will inform any lender, lessor or other third
party that has or may have a lien or security interest or any other interest in
property of Blackhawk Biofuels that REG Marketing is the owner of the
Feedstocks and the Biodiesel that is the subject of this Agreement.  “Notwithstanding anything to the contrary set
forth herein, Blackhawk Biofuels and REG Marketing acknowledge and agree that
pursuant to the terms of the Feedstock Agreement, Bunge shall have title in the
Feedstocks 


 


6

















 


purchased by Bunge pursuant to
the terms of the Feedstock Agreement, and Bunge shall have the right to file
precautionary financing statements and amendments and/or continuations thereto
pursuant to the Uniform Commercial Code to further evidence and memorialize its
absolute ownership interest in the Feedstocks.”


 


18.                                 Product Segregation.  REG Marketing, on behalf of Blackhawk
Biofuels, shall be allowed to add additional Feedstocks owned by REG Marketing
as needed to meet the quality and yield requirements hereunder, so long as such
additional Feedstocks have cold flow characteristics that are capable of
meeting the cold flow specifications set out on the applicable Order or
Nomination, and the Biodiesel to be produced shall in any event meet the specifications
required hereunder, as modified by the Order or Nomination and Acceptance
applicable.  In such event, REG Marketing
shall off-set any costs for such additional Feedstocks against the toll fees to
be paid by REG Marketing pursuant to Section 4 hereof.  Pursuant to the terms of the Feedstock
Agreement, Blackhawk Biofuels shall allow Bunge to store the Feedstocks at the
Facility; provided, however, such Feedstocks shall be segregated from any
Feedstocks owned by REG Marketing pursuant to the terms of this Agreement.


 


19.                                 Failure to Process.  If for any reason other than REG Marketing’s
failure to deliver Feedstocks, methanol, and catalyst as required under this
Agreement (and other than a matter covered by the force majeure provisions of
this Agreement) Blackhawk Biofuels fails to process the Feedstocks in to the
certified Biodiesel within the time frame contemplated by this Agreement,
Blackhawk Biofuels will pay to REG Marketing the amount determined by first
dividing the number of pounds of Feedstocks delivered to Blackhawk Biofuels by
the Maximum Feedstock Usage per gallon yield under Section 7 and
converting to gallons to determine the gallons of Biodiesel which should have
been processed (“Required Gallons”); second, subtracting the actual gallons of
Biodiesel received by REG Marketing from the Required Gallons to determine the
number of gallons which Blackhawk Biofuels failed to process (“Biodiesel
Shortage”); and third,  multiply the
Biodiesel Shortage by REG Marketing’s average market price per gallon of
Biodiesel delivered by Blackhawk Biofuels to REG Marketing up to such time of
computation (or if none delivered another reasonable method of determining the
market value of Biodiesel FOB Danville as may be agreed by the Parties, or
otherwise determined if the Parties can not so agree).


 


20.                                 Facility Shutdowns.  Blackhawk Biofuels agrees to notify REG
Marketing of any scheduled shutdowns a minimum of thirty (30) days in
advance.  In the event there are any
Facility shutdowns due to unscheduled power or mechanical problems which will
affect receiving or shipping schedules or are anticipated to continue for
twenty-four (24) hours or more Blackhawk Biofuels will notify REG Marketing as
soon as possible.


 


21.                                 Tax Credits; Blending, Shipping & Loading.  Blackhawk Biofuels
will, at the request of REG Marketing, blend the Biodiesel with petroleum
diesel (supplied by Blackhawk Biofuels at its cost) to create B99.9 biodiesel
at no additional charge to REG Marketing. 
Any excise tax or income tax credit or refund, including any blender’s
credit or CCC credit or refund (“Tax Credits”) relating to the Biodiesel
delivered to REG Marketing will be for the account of REG Marketing, and shall
be submitted (as applicable) to the United States Internal Revenue Service (“IRS”)
or other appropriate entity by Blackhawk Biofuels, unless otherwise requested
by REG Marketing Blackhawk Biofuels will not claim any Tax Credits relating to
the Biodiesel delivered to REG Marketing without the written consent of REG
Marketing.


 


7

















 


In addition, Blackhawk Biofuels
shall fulfill the requests regarding additives and load temperature as set out
on the “Shipping/Loadout Request” form supplied by REG Marketing and complete
the loadout information for each load of Biodiesel shipped, all as set out on
the attached as Exhibit D hereto.


 


22.                                 RINs and Biodiesel Certificates.  Blackhawk Biofuels
and REG Marketing shall cooperate with each other to generate Renewable
Identification Numbers (RINs) for the gallons of Biodiesel produced pursuant to
this Agreement, with such RINs to be the property of REG Marketing.  Blackhawk Biofuels and REG Marketing shall
also cooperate with each other to issue biodiesel certificates for the
Biodiesel produced pursuant to this Agreement, which certificates shall be
suitable for REG Marketing’s use in collecting the $1.00 per gallon blender’s
tax credit.  For purposes of clarity, all
gallons for these purposes shall be calculated on a temperature corrected basis
(at 60°
F).


 


23.                                 Force Majeure.  Neither Party hereto shall be liable for any
delay arising from circumstances beyond its control including acts of God, riot
or civil commotion, industrial dispute, fire, flood, drought, act of
government, terrorist acts, war, or sabotage (except failures or delays
resulting from a lack of a Party’s funds), provided that the Party seeking to
be excused shall make every reasonable effort to minimize the delay resulting
therefrom and shall give prompt written notice of the force majeure event to
the other Party.  The obligations of the
Party giving notice, so far as they are affected by the force majeure event,
will be suspended during, but not longer than, the continuance of the force
majeure event.  The affected Party must
act with commercially reasonable diligence to resume performance and notify the
other Party that the force majeure event no longer affects its ability to
perform under the Agreement.


 


24.                                 Independent Contractor.  Blackhawk Biofuels is acting hereunder and
its services are rendered to REG Marketing solely as an independent
contractor.  REG Marketing is not
authorized and shall not contract any obligations in the name of Blackhawk
Biofuels as a result of this Agreement (the Parties understanding that REG
Marketing may have such authority as may arise from other contracts entered in
to by the Parties, and including that Management and Operational Services
Agreement dated August 22, 2006 (“MOSA”)). 
Blackhawk Biofuels accepts full and exclusive liability for the payment
of any and all contributions or taxes for unemployment and workers’
compensation insurance, old age retirement benefits, pensions and annuities now
or hereafter imposed by any federal or state governmental authority which are
measured by wages, salaries or other remuneration paid to persons, and holds
harmless REG Marketing from any such liability. 
Blackhawk Biofuels agrees that in performing its duties contemplated by
this Agreement it shall comply with all applicable federal and state laws,
orders and regulations, and, to its knowledge, represents and warrants that the
Facilities are in compliance with existing environmental laws and regulations
and OSHA standards which may apply to the activities to be performed by
Blackhawk Biofuels hereunder.


 


25.                                 Confidentiality.


 


(a)                                  “Confidential Information” of Blackhawk Biofuels and REG
Marketing includes the terms of this Agreement, the Feedstocks composition, the
biodiesel specifications, all business information of Blackhawk Biofuels and
REG Marketing, including, but not limited to, their respective pricing,
supplier lists, quantities of supplies purchased, all processing and
manufacturing information of 


 


8

















 


Blackhawk Biofuels and REG Marketing,
all processes and information used in the processing of Feedstocks into
Biodiesel, and all other confidential or proprietary information of Blackhawk
Biofuels and REG Marketing.  All “Confidential
Information” shall remain the sole property of the original owner of that information.


 


(b)                                 Blackhawk Biofuels and REG Marketing agree that (except as
necessary for REG Marketing to meet its obligations under the MOSA) they shall
not for any purpose use or disclose to any third party any Confidential
Information not owned by it. Such confidentiality obligations shall survive the
expiration or earlier termination of this Agreement.


 


26.                                 Default.  Each Party will be entitled to all damages
(including costs and reasonable attorney fees incurred in enforcement of such
Party’s rights hereunder) and other rights and remedies available at law or in
equity, in addition to any other remedies as may be provided in this Agreement,
upon the default or other failure to perform of the other Party; provided,
however, that before taking action to enforce such breach or terminating this
Agreement the Party claiming default or failure to perform shall first provide
the defaulting Party with written notice detailing the circumstances of its
failure to meet its obligations hereunder and an opportunity to cure such
failure within ten (10) days of such notice.


 


27.                                 Miscellaneous.


 


(a)                                  Notices.  Any notice (including Nominations and
Acceptances) required or permitted to be given pursuant to this Agreement is
validly given if in writing and: (i) personally delivered; (ii) sent
by electronic facsimile transmission or other means of electronic communication
capable of producing a printed copy and a confirmation of delivery; or (iii) sent
by prepaid registered mail or recognized overnight carrier, addressed to the
applicable party at its address indicated below or to such other address as any
party may specify by notice in writing to the other.  Any notice personally delivered on a business
day will be deemed conclusively to have been effectively given on the date
notice was delivered.  Any notice given
by facsimile or other means of electronic communication will be deemed
conclusively to have been given on the date specified on the confirmation of
such transmission.  Any notice sent by
prepaid registered mail will be deemed conclusively to have been effectively
given when actually received.  Notices
shall be addressed as follows:


 


	
  If
  to REG Marketing:

  	
  416 S. Bell Avenue, PO Box
  888

  
	
   

  	
  Ames, IA 50010

  
	
   

  	
  Attn: Gary Haer

  
	
   

  	
  Fax: (515) 239-8029

  
	
   

  	
   

  
	
  If
  to Blackhawk Biofuels:

  	
  210
  West Spring Street

  
	
   

  	
  Freeport,
  Illinois 61032

  
	
   

  	
  Attn:
  Ron Mapes

  
	
   

  	
  Fax:
  (815) 235-4727

  



 


9

















 


Any party may change the address to which notices are to be sent to it
by giving written notice of such change of address to the other parties in the
manner herein provided for giving notice. 
Any such notice, demand, request or other communication shall be deemed
given when mailed or delivered as aforesaid.


 


(b)                                 Cumulative Remedies.  The rights and remedies provided to Blackhawk
Biofuels and REG Marketing in this Agreement, or otherwise available at law or
in equity, shall be cumulative and may be exercised concurrently or
successively.


 


(c)                                  Governing Law/Choice of Forum.  This Agreement shall be deemed made and
entered unto in the State of Iowa and shall be governed and construed under and
in accordance with the laws of the State of Iowa without resort to said state’s
conflict of laws rules.  The U.S.
District Court for the Southern District of Iowa, or if such court lacks
jurisdiction, the Iowa District Court for Story County, Iowa, shall be the
venue and exclusive proper forum in which to adjudicate any case or controversy
arising either, directly or indirectly, under or in connection with this
Agreement.  The Parties further agree
that, in the event of litigation arising out of or in connection with these
matters, they will not contest or challenge the jurisdiction or venue of these
courts.


 


(d)                                 Amendments.  This Agreement may not be modified or amended
unless a written amendment to this Agreement is executed by REG Marketing and
Blackhawk Biofuels.


 


(e)                                  Severability.  If any provision of this Agreement may be
construed in two ways, one of which would render the provision illegal or
otherwise voidable and unenforceable and the other of which would render the
provision valid and enforceable, such provision shall have the meaning which
renders it valid and enforceable.  The
language of all provisions of this Agreement shall be construed according to
its fair meaning and not strictly against REG Marketing or Blackhawk
Biofuels.  It is the intention of the
Parties that the provisions of this Agreement be enforced to the fullest
extent.  In the event that any court
shall determine that any provision of this Agreement is unenforceable as
written, the Parties agree that the provision shall be amended so that it is
severable and they shall be interpreted and enforced as if all completely
invalid or unenforceable provisions were not contained in this Agreement.  Partially valid and enforceable provisions
shall be enforced to the extent that they are partially valid and enforceable.


 


(f)                                    Captions.  Section captions are used only for
convenience and are in no way to be construed as a part of this Agreement or as
a limitation of the scope of the particular sections to which they refer.  Words of any gender used in this Agreement
shall include any other gender, and words in the singular shall include the
plural where the context requires.


 


10

















 


***
Confidential material redacted and filed separately
with the Commission.


 


(g)                                 Assignment.  Neither Party may assign any of its rights in
or delegate any of its duties under this Agreement without the prior written
consent of the other Party. 
Notwithstanding the foregoing, a Party (“Assignor”) may without the need
for consent from the other Party assign any or all of its rights, duties and
obligations under this Agreement to another entity, or to such Party’s
affiliate or successor (collectively herein “Assignee”), if such Assignee
expressly assumes all obligations not otherwise remaining with Assignor
hereunder, and Assignor nonetheless remains responsible hereunder.


 


(h)                                 Interpretation.  This Agreement has been prepared after
extensive negotiation between the Parties hereto, and if any ambiguity is
contained herein, then in resolving such ambiguity, no weight shall be given in
favor of or against either Party solely on account of its drafting this
Agreement.


 


(i)                                     Entire Agreement.  Time is of the essence of this
Agreement.  This Agreement together with
the Exhibits referenced herein constitute the entire agreement by and between
the Parties and all prior written and verbal agreements, proposals, representations
and other communications between the Parties regarding this tolling arrangement
are superseded.


 


(j)                                     Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together will constitute one and the same instrument, and may be executed and
delivered by facsimile signature or similar means, which shall be considered an
original.


 


(k)                                  Most Favored Terms.  Blackhawk Biofuels represents and warrants as
of the date hereof and covenants and agrees from and after the date hereof that
none of the provisions offered to any other person or entity is or will be more
favorable to such person or entity than those offered under this Agreement,
and, if they are or become more favorable to any other person or entity during
the term of this Agreement or any continuation or extension thereof, Blackhawk
Biofuels shall give written notice thereof to REG Marketing, and REG Marketing
shall have the option (which option must be exercised by written notice to
Blackhawk Biofuels with ten (10) business days after notice thereof) to
amend this Agreement to include any such more favorable terms.  If such option is exercised, Blackhawk
Biofuels and REG Marketing shall execute an appropriate written amendment to
this Agreement.


 


(l)                                     MOSA Fee.  In view of the fact that this Agreement is to
process Feedstocks owned by REG Marketing for the benefit of REG Marketing, REG
Marketing agrees that Blackhawk Biofuels shall not be required to pay the
variable fee of $ *** /gal under the MOSA for the volume of Biodiesel processed
for and delivered to REG Marketing under this Agreement.  Blackhawk BioFuels shall continue to pay the
Fixed fee of $ *** per month as outlined in the MOSA.


 


11

















 


IN WITNESS WHEREOF, Blackhawk
Biofuels and REG Marketing have executed this Agreement as of the date first
shown above.


 


	
  BLACKHAWK BIOFUELS, LLC

  	
  REG MARKETING & LOGISTICS GROUP, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By

  	
  /s/  RONALD L. MAPES

  	
   

  	
  By:

  	
  /s/ GARY HAER

  
	
  Name

  	
  Ronald L. Mapes

  	
   

  	
  Name:

  	
  Gary Haer

  
	
  Title

  	
  Chair

  	
   

  	
  Title:

  	
  Vice President Sales and Marketing

  



 


12
















 





 


Exhibit A


 


(Form of Order/Nomination)


 


	
                    ORDER
  NUMBER
                 or
                        NOMINATION
  NUMBER

  
	
   

  
	
  For Production Week beginning:

  	
     /      /        

  
	
   

  	
   

  
	
  Date Sent to Blackhawk BioFuels, LLC:

  	
     /      /        

  
	
   

  	
   

  
	
  Date Reviewed by Blackhawk BioFuels, LLC:

  	
     /      /        

  
	
   

  	
   

  
	
  Blackhawk BioFuels, LLC’s Action: (circle)   ACCEPT   or    REJECT

  
	
   

  
	
  Date Accepted/Rejected by Blackhawk BioFuels, LLC:

  	
     /      /        

  



 


	
   

  	
  o  REG
  — 9000 ASTM 

  
	
  Product Specification

  	
   

  
	
   

  	
  o  REG
  — 9000 EN

  
	
   

  	
   

  
	
   

  	
  o  Cloud        °C 

  
	
  Cold Flow Specification

  	
   

  
	
   

  	
  o  CFPP        °C

  



 


	
  FEEDSTOCK TYPE

  	
   

  	
  Lbs ORDERED

  	
   

  	
  Contr. Yield

  	
   

  	
  Contr. Gallons

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TOTAL

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


	
                                                   Date

  	
   

  	
   

  	
                                                           Date

  
	
  REG Marketing & Logistics Group, LLC.

  	
   

  	
   

  	
  Blackhawk BioFuels, LLC.

  



 

















 


***
Confidential material redacted and filed separately
with the Commission.


 





 


“Exhibit B”


 


REG Feedstock Specifications


 


	
   

  	
   

  	
   

  	
   

  	
  Free Fatty Acid

  (as Oleic)

  	
   

  	
  Moisture

  	
   

  	
  Insoluble

  Impurities

  	
   

  	
  Total MIU

  	
   

  	
  Phosphorus

  	
   

  	
  Color

  (FAC

  Scale)

  	
   

  	
  Maximum

  Feedstock

  Usage per

  Gallon of

  BioDiesel

  (MFU)

  	
   

  
	
   

  	
   

  	
  Analytical Method

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  AOCS Ca 5a-40

  	
   

  	
  AOCS Ca 2c-25

  	
   

  	
  AOCS Ca 3a-46

  	
   

  	
  calc

  	
   

  	
  AOCS Ca 12-55

  	
   

  	
  AOCS Ca 13a-43

  	
   

  	
   

  	
   

  



 


	
  Feedstock

  Group

  	
   

  	
  Feedstock

  Type

  	
   

  	
  wt%

  	
   

  	
  wt%

  	
   

  	
  wt%

  	
   

  	
  wt%

  	
   

  	
  ppm

  	
   

  	
   

  	
   

  	
  Lbs/Gal

  	
   

  
	
   

  	
   

  	
  RB Soy

  	
   

  	
  <0.25

  	
   

  	
  <0.3

  	
   

  	
  <0.05

  	
   

  	
  <1.5

  	
   

  	
  <20

  	
   

  	
  Clear & bright

  	
   

  	
  7.40

  	
   

  
	
   

  	
   

  	
  Crude Degummed Soy

  	
   

  	
  <1.0

  	
   

  	
  <0.3

  	
   

  	
  <0.25

  	
   

  	
  <2.0

  	
   

  	
  <200

  	
   

  	
  Typical

  	
   

  	
  7.60

  	
   

  
	
   

  	
   

  	
  Distillers Corn Oil

  	
   

  	
  <15

  	
   

  	
  <1.0

  	
   

  	
  <0.5

  	
   

  	
  <2.5

  	
   

  	
  <20

  	
   

  	
  Typical

  	
   

  	
  8.90

  	
   

  
	
   

  	
   

  	
  Edible Tallow

  	
   

  	
  <0.75

  	
   

  	
  <0.2

  	
   

  	
  <0.05

  	
   

  	
  <1.0

  	
   

  	
  <400

  	
   

  	
  Typical

  	
   

  	
  7.50

  	
   

  
	
  Animal Fats

  	
   

  	
  Tallow

  	
   

  	
  <4

  	
   

  	
  <1.0

  	
   

  	
  <0.25

  	
   

  	
  <2.0

  	
   

  	
  <400

  	
   

  	
  Typical

  	
   

  	
  *(1)

  	
   

  
	
   

  	
   

  	
  Poultry Fat/Grease

  	
   

  	
  <8.0

  	
   

  	
  <1.0

  	
   

  	
  <0.25

  	
   

  	
  <2.0

  	
   

  	
  <400

  	
   

  	
  Typical

  	
   

  	
  *(1)

  	
   

  
	
   

  	
   

  	
  Choice White Grease

  	
   

  	
  <4

  	
   

  	
  <1.0

  	
   

  	
  <0.25

  	
   

  	
  <2.0

  	
   

  	
  <400

  	
   

  	
  Typical

  	
   

  	
  *(1)

  	
   

  
	
   

  	
   

  	
  Yellow Grease & UFO

  	
   

  	
  <15

  	
   

  	
  <1.0

  	
   

  	
  <0.25

  	
   

  	
  <2.0

  	
   

  	
  <400

  	
   

  	
  Typical

  	
   

  	
  *(1)

  	
   

  



 






	
  *(1)

  	
  Calculation for Maximum Feedstock Usage using high FFA feedstocks

  
	
   

  	
   

  
	
   

  	
  Maximum Feedstock Usage = (*** x %  FFA) +*** 

  
	
   

  	
  Example: Tested FFA = ***

  
	
   

  	
   

  
	
   

  	
  Max
  Usage = (*** x ***%) + *** = *** lbs/gal of Biodiesel

  



 


14

















 





 


Attachment C


 


REG-9000Ô ASTM


 


Based
off ASTM D6751 Specifications


 


	
   

  	
   

  	
  REG-9000Ô  

  	
   

  	
   

  	
   

  	
  Test Method

  
	
  Test Parameter

  	
   

  	
  Limit

  	
   

  	
  Units

  	
   

  	
  (current revision)

  
	
  Cloud
  point:

  	
   

  	
  Per
  Order

  	
   

  	
  °C

  	
   

  	
  D 2500 Allowable
  variance of +/- 2°C

  
	
  Free
  Glycerin:

  	
   

  	
  <0.014

  	
   

  	
  % Mass

  	
   

  	
  D 6584

  
	
  Total
  Glycerin:

  	
   

  	
  <0.15

  	
   

  	
  % Mass

  	
   

  	
  D 6584

  
	
  Monoglycerides(1):

  	
   

  	
  <0.500

  	
   

  	
  % Mass

  	
   

  	
  D 6584

  
	
  Diglycerides(2):

  	
   

  	
  <0.200

  	
   

  	
  % Mass

  	
   

  	
  D 6584

  
	
  Triglycerides(3):

  	
   

  	
  <0.150

  	
   

  	
  % Mass

  	
   

  	
  D 6584

  
	
  Water &
  Sediment:

  	
   

  	
  <0.020

  	
   

  	
  %
  Volume

  	
   

  	
  D 2709

  
	
  Acid
  Number:

  	
   

  	
  <0.40

  	
   

  	
  mg
  KOH/g

  	
   

  	
  D 664

  
	
  Visual
  Inspection:

  	
   

  	
  1, max

  	
   

  	
  Haze

  	
   

  	
  D 4176,
  procedure 2

  
	
  Relative
  Density at 60°F:

  	
   

  	
  0.85 - 0.90

  	
   

  	
  n/a

  	
   

  	
  D1298 (BQ-9000)

  
	
  Oxidation
  Stability (100°C)

  	
   

  	
  3 min
  or per Shipping Request

  	
   

  	
  hrs

  	
   

  	
  EN 14112

  
	
  Flash
  point (closed cup):

  	
   

  	
  <93

  	
   

  	
  °C

  	
   

  	
  D 93

  
	
  Alcohol
  Control 

  	
  Option
  1:  Methanol

  	
   

  	
  <0.2

  	
   

  	
  %
  Volume

  	
   

  	
  EN 14110

  
	
  Option
  2:  Flashpoint

  	
   

  	
  <130

  	
   

  	
  °C

  	
   

  	
  D 93

  
	
  Moisture(4):

  	
   

  	
  <0.020

  	
   

  	
  %
  Volume

  	
   

  	
  E203

  
	
  Cold
  Soak Filtration:

  	
   

  	
  <200

  	
   

  	
  seconds

  	
   

  	
  D 6751 Annex

  
	
  Sulfur:

  	
   

  	
  <10

  	
   

  	
  ppm

  	
   

  	
  D 2622

  
	
  Sodium &
  Potassium Combined:

  	
   

  	
  <2.0

  	
   

  	
  ppm
  (μg/g)

  	
   

  	
  EN 14538

  
	
  Calcium &
  Magnesium Combined:

  	
   

  	
  <1.0

  	
   

  	
  ppm
  (μg/g)

  	
   

  	
  EN 14538

  
	
  Phosphorus:

  	
   

  	
  <0.001

  	
   

  	
  % Mass

  	
   

  	
  D 4951

  
	
  Carbon
  Residue:

  	
   

  	
  <0.05

  	
   

  	
  % Mass

  	
   

  	
  D 4530

  
	
  Sulfated
  Ash:

  	
   

  	
  <0.02

  	
   

  	
  % Mass

  	
   

  	
  D 874

  
	
  Kinematic
  Viscosity at 40°C:

  	
   

  	
  3.8 - 5.0

  	
   

  	
  mm2/sec.

  	
   

  	
  D 445

  
	
  Copper
  Corrosion (3 hrs at 50°C):

  	
   

  	
  No. 1

  	
   

  	
  n/a

  	
   

  	
  D 130

  
	
  Distillation
  at 90% Recovered:

  	
   

  	
  360, max

  	
   

  	
  °C

  	
   

  	
  D 1160

  
	
  Cetane
  number:

  	
   

  	
  47, min

  	
   

  	
  n/a

  	
   

  	
  D 613

  



 






(1),(2),(3),(4),(5)  These are not ASTM D 6751
nor BQ9000 specification requirements


 

















 





 


Attachment C-2


 


REG-9000Ô EN


 


Based
off EN 14214 Specifications


 


	
  Test Parameter

  	
   

  	
  REG-9000Ô
  Limit

  	
   

  	
  Units

  	
   

  	
  Method

  
	
  Free
  Glycerin:

  	
   

  	
  0.014

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14105

  
	
  Total
  Glycerin:

  	
   

  	
  0.150

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14105

  
	
  Monoglycerides:

  	
   

  	
  0.500

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14105

  
	
  Diglycerides:

  	
   

  	
  0.200

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14105

  
	
  Triglycerides:

  	
   

  	
  0.150

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14105

  
	
  Ester
  Content:

  	
   

  	
  >96.5

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14103

  
	
  Linolenic
  Acid Methyl Ester:

  	
   

  	
  12, max

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14103

  
	
  Polyunsaturate
  Methyl Ester:

  	
   

  	
  1, max

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14103

  
	
  Total
  Contamination:

  	
   

  	
  24, max

  	
   

  	
  mg/kg

  	
   

  	
  EN 12662

  
	
  Acid
  Number:

  	
   

  	
  <0.40

  	
   

  	
  mg
  KOH/g

  	
   

  	
  EN 14104

  
	
  Cold
  Filter Plugging Point:

  	
   

  	
  Per
  Order

  	
   

  	
  °C

  	
   

  	
  EN 116 Allowable
  variance of +/- 2°C

  
	
  Density
  @15°C:

  	
   

  	
  860 - 900

  	
   

  	
  kg/m(3)

  	
   

  	
  EN ISO 3675

  
	
  Oxidative
  Stability:

  	
   

  	
  6 min
  or per Shipping Request

  	
   

  	
  hrs

  	
   

  	
  EN 14112:2003

  
	
  Flashpoint:

  	
   

  	
  >170

  	
   

  	
  °C

  	
   

  	
  EN ISO 3679

  
	
  Iodine
  Value:

  	
   

  	
  120 Max

  	
   

  	
  g/100g

  	
   

  	
  EN 14111

  
	
  Methanol
  Content:

  	
   

  	
  0.2, max

  	
   

  	
  % (m/m)

  	
   

  	
  EN 14110

  
	
  Water
  Content:

  	
   

  	
  200, max

  	
   

  	
  mg/kg

  	
   

  	
  EN ISO 12937

  
	
  Sulfur
  Content:

  	
   

  	
  >10

  	
   

  	
  mg/kg

  	
   

  	
  EN ISO 20846

  
	
  Phosphorus
  Content:

  	
   

  	
  >10

  	
   

  	
  mg/kg

  	
   

  	
  EN 14107

  
	
  Sodium &
  Potassium Combined:

  	
   

  	
  >2

  	
   

  	
  mg/kg

  	
   

  	
  EN 14538
  BS2000-547

  
	
  Calcium &
  Magnesium Combined:

  	
   

  	
  >2.0

  	
   

  	
  mg/kg

  	
   

  	
  EN 14538
  BS2000-547

  
	
  Sulfated
  Ash:

  	
   

  	
  <0.02

  	
   

  	
  % (m/m)

  	
   

  	
  ISO 3987

  
	
  Kinematic
  Viscosity at 40°C:

  	
   

  	
  3.5 - 5.0

  	
   

  	
  mm2/sec.

  	
   

  	
  EN ISO 3104

  
	
  Copper
  Corrosion @ 50°C for 3hrs:

  	
   

  	
  1, max

  	
   

  	
  n/a

  	
   

  	
  EN ISO 2160

  
	
  Cetane
  Number:

  	
   

  	
  51 Min.

  	
   

  	
  n/a

  	
   

  	
  EN ISO 5165

  
	
  Carbon
  Residue @ 10% distillation remnant:

  	
   

  	
  0.3

  	
   

  	
  %(m/m)

  	
   

  	
  EN ISO 10370

  
	
  Cold
  Soak Filtration:

  	
   

  	
  <200

  	
   

  	
  seconds

  	
   

  	
  D 6217 Annex

  



 

















 





 


Exhibit D


Shipping/Loadout Request


 


	
  Today’s Date:

  	
   

  	
        /     /     

  	
   

  	
   

  
	
  Target Date to Load:

  	
   

  	
        /     /     

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Loading Requirements

  
	
   

  
	
  o

  	
  Truck

  	
  Trucking Company                           

  
	
  o

  	
  REG Railcar

  
	
   

  	
   

  	
   

  
	
  Product:

  	
   

  
	
   

  	
   

  
	
  o

  	
  B99.9

  	
   

  
	
  o

  	
  B100

  	
   

  
	
   

  	
   

  	
   

  
	
  o

  	
  Oxidative Additive:                          
  ppm

  
	
  o

  	
  Minimum Load
  Temperature:                                   
  °F

  
							



 


Blackhawk Fills out
Remainder of form:


 


Lot Number:                                


 


o 
Loadout Checklist Complete. 
Operator initials                           


 


Seal Numbers:                   


 


Railcar ID:                       


 


RIN #’s                                                           


 


 


	
  Time Scheduled                     

  	
  *Biodiesel Loaded (gal)                     

  
	
   

  	
   

  
	
  Time Arrived                     

  	
  *Diesel Loaded (gal)                     

  
	
   

  	
   

  
	
  Time Loaded                     

  	
  *Total Gallons         (gal)                     

  
	
   

  	
   

  
	
  BOL #                     

  	
   

  



 






*Gal corrected to 60 degrees Fahrenheit.


 


When completed Scan and e-mail to:  bill.neese@regfuel.com, adam.sander@regfuel.com,
mike.alleman@regfuel.com, dave.simon@regfuel.com, natan.wylke@com,
Jason.schwenneker@regfuel.com.