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Exhibit 4.4  

 
 

Third Supplemental Indenture  

        THIRD
SUPPLEMENTAL INDENTURE, dated as of July 7, 2006 (this "Supplemental Indenture"), among The Hertz Corporation, a corporation
organized duly organized and existing under the laws of the state of Delaware (as successor by merger to CCMG Acquisition Corporation, a Delaware corporation) (and its successors and assigns) (the
"Company"); Hertz Equipment Rental Corporation, Brae Holding Corp., Hertz Claim Management Corporation, HCM Marketing Corporation, Hertz Local Edition
Corp., Hertz Local Edition Transporting, Inc., Hertz Global Services Corporation, Hertz System, Inc., Hertz Technologies, Inc., Hertz Transporting, Inc. and Smartz Vehicle
Rental Corporation (the "Subsidiary Guarantors"); and Wells Fargo Bank, National Association, as Trustee under the Indenture referred to below. 

 
 

W I T N E S S E T H:  
  

        WHEREAS, the Company and the Subsidiary Guarantors are parties to an Indenture, dated as of December 21, 2005 (as amended, supplemented, waived or
otherwise modified, the "Indenture"), providing for the issuance of 10.5% Senior Subordinated Notes due 2016 of the Company (the
"Notes"); 

        WHEREAS,
the Company and the Subsidiary Guarantors desire to execute and deliver an amendment to the Indenture for the purposes of  (i) correcting certain errors and omissions in Sections 101 and 407 of the
Indenture and  (ii) conforming the text of paragraph (iv) of Section 412(b) of the Indenture to the corresponding provision of the
"Description of Notes" section of the confidential offering memorandum, dated December 15, 2005, relating to the offering of the Notes; 

        WHEREAS,
each of the Company and each Subsidiary Guarantor desires to enter into such supplemental indenture for good and valuable consideration (including, in the case of each
Subsidiary Guarantor, substantial economic benefit in that the financial performance and condition of such Subsidiary Guarantor is dependent on the financial performance and condition of the Company,
the obligations hereunder of which such Subsidiary Guarantor has guaranteed, and on such Subsidiary Guarantor's access to working capital through the Company's access to revolving credit borrowings
under the Senior Credit Agreements); and 

        WHEREAS,
pursuant to Section 901 of the Indenture, the parties hereto are authorized to execute and deliver this Supplemental Indenture to amend the Indenture, without the consent
of any Holder; 

        NOW,
THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company and the Trustee mutually
covenant and agree for the benefit of the Holders of the Notes as follows: 

        1.    Defined Terms.    As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or
recital hereto are used herein as therein defined. The words "herein," "hereof" and "hereby" and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture
as a whole and not to any particular Section hereof. 

        2.    Amendment of Section 101.    Section 101 of the Indenture is hereby amended pursuant to Sections
901 (1), (9) and/or (11) of the Indenture (in the case of paragraph 2(a) below) and pursuant to Sections 901 (1) and/or (11) of the Indenture (in the case of
paragraphs 2(b) and (c) below) as follows: 

        (a)   by
the deletion in its entirety of the defined term "Consolidated EBITDA" and its corresponding definition, and the substitution therefor of the following: 

        "Consolidated EBITDA" means, for any period, the Consolidated Net Income for such period, plus the following to the extent deducted in
calculating such Consolidated Net Income, without duplication: (i) provision for all taxes (whether or not paid, estimated or accrued) based on income,
profits or capital, (ii) Consolidated Interest Expense and any Special Purpose Financing Fees, (iii)
depreciation (excluding Consolidated Vehicle Depreciation), amortization (including but not limited to amortization of goodwill and intangibles and amortization and write-off of financing
costs) and all other non-cash charges or non-cash losses, (iv) any expenses or charges related to any Equity Offering,
Investment or Indebtedness permitted by this Indenture (whether or not consummated or incurred), (v) the amount of any minority interest expense and
(vi) any management, monitoring, consulting and advisory fees and related expenses paid to any of Carlyle, CDR or ML and their respective Affiliates. 

        (b)   by
the deletion in its entirety of the defined term "Consolidated Tangible Assets" and its corresponding definition, and the substitution therefor of the following: 

        "Consolidated Tangible Assets" means, as of any date of determination, the amount equal to (x) the sum of Consolidated Quarterly
Tangible Assets as at the end of each of the most recently 

 

ended
four fiscal quarters of the Company for which a calculation thereof is available, divided by (y) four; provided that for purposes of  Section 407(b), Section 409(b),  Section 411 and the definition of "Permitted Investment," Consolidated Tangible Assets shall not be less than
$14,426.0 million. 

        (c)   by
the insertion immediately following the defined term "Obligations" of the following: 

        "Offering Memorandum" means the confidential Offering Memorandum of the Company, dated December 15, 2005, relating to the offering
of the Notes. 

        3.    Amendment of Section 407.    The text of paragraph (xii) of Section 407 (entitled
"Limitation on Indebtedness"), excluding the paragraph number at the beginning of such paragraph, is amended pursuant to Sections 901(1) and/or (11) of the Indenture in its entirety to read as
follows: 

"Contribution
Indebtedness, and any Refinancing Indebtedness with respect thereto; and" 

        4.    Amendment of Section 412.    The text of paragraph (iv) of Section 412 (entitled
"Limitation on Transactions with Affiliates"), excluding the paragraph number at the beginning of such paragraph, is hereby amended pursuant to Sections 901(1), (9) and/or (11) of the
Indenture in its entirety to read as follows: 

"any
transaction arising out of agreements or instruments in existence on the Issue Date (other than any Tax Sharing Agreement or Management Agreement referred to in Section 412(b)(vii)), and
any payments made pursuant thereto, 

        5.    Governing Law.    THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK. THE TRUSTEE, THE COMPANY, ANY OTHER OBLIGOR IN RESPECT OF THE NOTES AND (BY THEIR ACCEPTANCE OF THE NOTES) THE HOLDERS AGREE TO SUBMIT TO THE JURISDICTION OF ANY UNITED STATES
FEDERAL OR STATE COURT LOCATED IN THE BOROUGH OF MANHATTAN, IN THE CITY OF NEW YORK IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS SUPPLEMENTAL INDENTURE. 

        6.    Ratification of Indenture; Supplemental Indentures Part of Indenture.    Except as expressly amended hereby, the
Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of
the Indenture for all purposes, and every Holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby. The Trustee makes no representation or warranty as to the validity
or sufficiency of this Supplemental Indenture or as to the accuracy of the recitals to this Supplemental Indenture. 

        7.    Counterparts.    The parties hereto may sign one or more copies of this Supplemental Indenture in counterparts,
all of which together shall constitute one and the same agreement. 

        8.    Headings.    The Section headings herein are for convenience of reference only and shall not be deemed to alter
or affect the meaning or interpretation of any provisions hereof. 

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        IN
WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written. 

	 	 	THE HERTZ CORPORATION
	
 	
 	

By:	

/s/  HAROLD E. ROLFE      

	 	 	 	Name:	Harold E. Rolfe
	 	 	 	Title:	Senior Vice President, General Counsel and Secretary

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	 	 	HERTZ EQUIPMENT RENTAL CORPORATION

BRAE HOLDING CORP.

HERTZ CLAIM MANAGEMENT CORPORATION

HCM MARKETING CORPORATION

HERTZ LOCAL EDITION CORP.

HERTZ LOCAL EDITION TRANSPORTING, INC.

HERTZ GLOBAL SERVICES CORPORATION

HERTZ SYSTEM, INC.

HERTZ TECHNOLOGIES, INC.

HERTZ TRANSPORTING, INC.

SMARTZ VEHICLE RENTAL CORPORATION,
 each as a Subsidiary Guarantor
	

 	
 	

By:	

/s/  ROBERT H. RILLINGS      

	 	 	 	Name:	Robert H. Rillings
	 	 	 	Title:	Treasurer

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	 	 	WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
	

 	
 	

By:	

/s/  TIMOTHY P. MOWDY      

	 	 	 	Name:	Timothy P. Mowdy
	 	 	 	Title:	Vice President

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QuickLinks

Third Supplemental Indenture

W I T N E S S E T HExhibit
10.1

 

Pursuant to 17 C.F.R. § 240.24b-2,
confidential information (indicated by [***]) has been omitted and has been
filed separately with the Securities and Exchange Commission pursuant to a
Confidential Treatment Application filed with the Commission.

 

ETHANOL
PURCHASE AND SUPPLY AGREEMENT

 

                THIS
ETHANOL PURCHASE AND SUPPLY AGREEMENT (“Agreement”) is made and entered into as
of the day and year set forth above the signatures hereto by and between Iowa
Falls Ethanol Plant, L.L.C., an Iowa limited liability company (“IFEP”), and
Eco-Energy, Inc., a Tennessee corporation (“EEI”).

 

RECITALS:

 

A.                                   IFEP is in the
process of constructing an ethanol plant located in or around Iowa Falls, Iowa.

 

B.                                     EEI desires to
submit purchase orders for the entire output of Ethanol (as that term is
defined in Section 1 of this Agreement) to IFEP, and IFEP desires to receive
purchase orders for the entire output of Ethanol from EEI, and if IFEP accepts
any such purchase orders, EEI and IFEP desire to, respectively, purchase and
sell the Ethanol which is the subject of those accepted purchase orders, all
upon and subject to the terms and conditions of this Agreement.

 

NOW, THEREFORE, in consideration of the Recitals and the
mutual agreements set forth herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged,
IFEP and EEI agree as follows:

 

1.             Definitions.  The following terms shall have the meanings
set forth below for purposes of this Agreement:

 

(a)            Accepted
Purchase Order.  The term “Accepted
Purchase Order” is defined in Section 3 of this Agreement.

 

(b)           Affiliate.  The term “Affiliate” shall mean, with respect
to either party to this Agreement, any person that now or hereafter (i) is
owned or controlled, directly or indirectly, by such party, (ii) owns or
controls, directly or indirectly, such party, or (iii) is under common control
with such party.

 

(c)            Agreement.  The term “Agreement” shall mean this Ethanol
Purchase and Supply Agreement, as the same may be amended from time to time
pursuant to Section 29 of this Agreement.

 

(d)           EEI.  The term “EEI” shall mean Eco-Energy, Inc.,
and its permitted successors and assigns.

 

(e)            EEI Carrier.  The term “EEI Carrier” is defined in Section
5 of this Agreement.

 

 

(f)            Ethanol.  The term “Ethanol” shall mean the denatured
ethanol which is produced at the Plant.

 

(g)           IFEP.  The term “IFEP” shall mean Iowa Falls Ethanol
Plant, L.L.C., and its permitted successors and assigns.

 

(h)           Impossibility
Event.  The term “Impossibility Event”
is defined in Section 27 of this Agreement.

 

(i)             Plant.  The term “Plant” shall mean the ethanol plant
of IFEP located in or around Iowa Falls, Iowa.

 

(j)             Production
Estimate.  The term “Production
Estimate” is defined in Section 2 of this Agreement.

 

(k)            Purchase Order.  The term “Purchase Order” is defined in
Section 2 of this Agreement.

 

(l)             Purchase Order
Form.  The term “Purchase Order Form”
is defined in Section 4 of this Agreement.

 

(m)           Purchase Price.  The term “Purchase Price” is defined in Section
9 of this Agreement.

 

(n)           Rejected Purchase
Order.  The term “Rejected Purchase
Order” is defined in Section 3 of this Agreement.

 

(o)           Specifications.  The term “Specifications” is defined in
Section 14 of this Agreement.

 

(p)           Storage Limit.  The term “Storage Limit” is defined in
Section 8 of this Agreement.

 

(q)           Value-Added
Transaction.  The term “Value-Added
Transaction” is defined in Section 9 of this Agreement.

 

(r)            VAT Payment.  The term “VAT Payment” is defined in Section
9 of this Agreement.

 

Other
terms utilized in this Agreement may be defined elsewhere in this Agreement.

 

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2.            Purchase Orders From EEI;
Estimated Production of Ethanol.  EEI
shall submit purchase orders (each, a “Purchase Order”) to IFEP for purchases
of the entire output of Ethanol from the Plant, all upon and subject to the
terms and conditions of this Agreement.

 

EEI shall submit Purchase Orders on such a periodic basis as is
necessary to permit IFEP to operate at and maintain IFEP’s normal, full
production capacity schedule and otherwise with such sufficient advance notice
so as to reasonably allow IFEP to determine that the Storage Limit will not be
exceeded and for IFEP to provide the services required of IFEP under Section 5
of this Agreement.

 

IFEP shall  provide to EEI, at
least four (4) days prior to the first business day of each calendar week, a
written estimate (each, a “Production Estimate”) of IFEP’s estimated production
of Ethanol which includes the calendar week in question.  IFEP may give Production Estimates on a
weekly, monthly or other periodic basis, and IFEP may amend any Production
Estimate at any time.  IFEP will also
keep EEI informed on each business day (i.e., excluding weekends and IFEP
recognized holidays) regarding the Ethanol inventory at the Plant.  All such Production Estimates and daily
information may be given by IFEP to an EEI Representative (as that term is
defined in Section 25 of this Agreement) designated by EEI by facsimile, or to
such other individual, facsimile number and/or by such other reasonable means
as EEI may designate to IFEP in writing from time to time in accordance with
Section 35 of this Agreement.  The
current facsimile number of EEI for this purpose is set forth below EEI’s
signature to this Agreement.

 

The nameplate design capacity of the Plant is 40,000,000 gallons of
ethanol per year, and the estimated output of Ethanol from the Plant at full
production capacity is anywhere from approximately 40,000,000 to 50,000,000
gallons per year once the Plant is at full production capacity.  IFEP estimates that the Plant will commence
operations and the production of Ethanol some time during the month of
November, 2004, and that the Plant could be at full production capacity within
thirty (30) days of the commencement date of operations at the Plant.  IFEP may, however, in its discretion, from
time to time expand the nameplate design capacity of the Plant to anywhere up
to 90,000,000 gallons of ethanol per year, such that the estimated output of
Ethanol from the Plant at full production capacity may be anywhere from the
current approximately 40,000,000 gallons per year to up to approximately
100,000,000 gallons per year.  IFEP will
keep EEI reasonably apprised of the progress of any such expansion, and IFEP
will provide EEI with written notice of the estimated date on which additional
Ethanol will first be available pursuant to any such expansion at least one
hundred eighty (180) days before such date.

 

IFEP
shall, however, have the right to manage its business in all respects and in
its discretion, and it is understood that the total output of Ethanol may vary
and shall be determined by IFEP from time to time, and that no warranty or
representation has been made by IFEP as to the output of Ethanol from the Plant
at any given time or from time to time. 
IFEP will, however, fulfill Accepted Purchase Orders, and will use
commercially reasonable efforts to produce the amount of Ethanol estimated in
its Projection Estimates, all upon and subject to the terms and conditions of
this Agreement.  EEI also understands
that IFEP may produce Ethanol in excess of the amounts set forth in IFEP’s
Production Estimates, and EEI will submit Purchase Orders for all Ethanol which
may from time to time be produced at the Plant which is in excess of the

 

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amounts set forth in any Production
Estimates, all upon and subject to the terms and conditions of this Agreement.

 

3.             Acceptance or Rejection of
Purchase Orders by IFEP.  IFEP may
accept or reject each Purchase Order, in whole, but not in part, in IFEP’s
commercially reasonable discretion.

 

IFEP
shall attempt to notify EEI via e-mail (if an e-mail address is provided in the
Purchase Order), or otherwise to any EEI Representative, of whether IFEP
accepts or rejects each Purchase Order within the time period set forth in the
Purchase Order.  If IFEP fails to notify
EEI within the time period set forth in the Purchase Order, however, IFEP shall
be deemed to have rejected the Purchase Order in question.

 

Any
Purchase Order which is accepted by IFEP is referred to in this Agreement as an
“Accepted Purchase Order”.  Any Purchase
Order which is rejected by IFEP is referred to in this Agreement as a “Rejected
Purchase Order”.

 

4.             Additional Terms Regarding
Submission of Purchase Orders; Priority of This Agreement.  A Purchase Order may include a request for
the sale of Ethanol on a one-time basis or on a weekly, monthly, quarterly or
other periodic basis.

 

                Each Purchase Order shall be
placed by EEI properly completing and executing a purchase order in either the
form attached to this Agreement as Exhibit “A” or Exhibit “B” or another
written purchase order form acceptable to IFEP (in any case, the “Purchase
Order Form”), and forwarding the completed and executed Purchase Order Form to
IFEP either (i) in accordance with Section 35 of this Agreement, or (ii) by
e-mail to the attention of            at           or
to the attention of such other individual or to such other e-mail address as
may be designated by IFEP from time to time in accordance with Section 35 of
this Agreement.

 

                The Purchase Order contemplated
by Exhibit “B” will (or another written Purchase Order Form acceptable to IFEP
may) take the form of EEI submitting to IFEP a proposed minimum purchase price
for Ethanol (the “Posted Price”) which will be effective for the day, week,
month or other period of time set forth in the Purchase Order Form (in any such
case, the “Posted Price Sales Period”), along with a proposed maximum number of
gallons of Ethanol which may be sold at or above the Posted Price at any time
during, and for pick-up by EEI during, the Posted Price Sales Period.  If IFEP accepts such a Purchase Order, EEI
may sell up to the maximum number of gallons of Ethanol set forth in the
Purchase Order Form at or above the Posted Price at any time during, and for
pick-up by EEI during, the Posted Price Sales Period without further approval
of each such sale by IFEP, but otherwise upon and subject to the terms and
conditions of this Agreement, and each such sale shall also be an Accepted
Purchase Order.

 

                Each Purchase Order placed by
EEI by a Purchase Order Form in the form of Exhibit “A” or another similar
written Purchase Order Form acceptable to IFEP shall be irrevocable by EEI for
the Acceptance Period specified in the Purchase Order, but EEI does not have a
binding obligation to purchase any Ethanol pursuant to said Purchase Order
unless EEI is able to enter into an agreement with a third party for the sale
of the Ethanol by EEI to such third party within one (1) day of IFEP’s
acceptance of the Purchase Order in question. 
If EEI does not enter into

 

4

 

such
agreement within said one (1) day period, the Purchase Order in question shall
automatically become a Rejected Purchase Order. 
EEI shall, however, utilize its best efforts to enter into such third
party sales and to otherwise purchase the Ethanol subject to each Purchase
Order.  Each Purchase Order placed by EEI
by a Purchase Order Form in the form of Exhibit “B” or another similar written
Purchase Order Form acceptable to IFEP shall be irrevocable by EEI for the
Acceptance Period specified in the Purchase Order, but EEI does not have a
binding obligation to purchase any Ethanol pursuant to said Purchase Order
unless and until EEI enters into an agreement with a third party for the sale
of the Ethanol by EEI to such third party during, and for pick-up by EEI
during, the Posted Price Sales Period. 
EEI shall, however, utilize its best efforts to enter into such third
party sales and to otherwise purchase the Ethanol subject to each Purchase
Order.  EEI shall provide IFEP with
written notice of all sales by EEI to third parties of Ethanol which is the
subject of an Accepted Purchase Order, which notice may be in the form of
loading instructions pursuant to Section 5 of this Agreement.

 

All Accepted Purchase Orders are made upon and subject to, and are
expressly limited solely to, the terms and conditions of the corresponding
Purchase Order Form and this Agreement, and IFEP hereby objects to any
additional, different or inconsistent terms which may be set forth in any
Purchase Order Form or in any other document that EEI may at any time submit to
IFEP along with any Purchase Order Form or otherwise, and no such additional,
different or inconsistent terms shall be part of any Accepted Purchase Order or
this Agreement or shall otherwise have any force or effect whatsoever.  Without limiting the generality of the foregoing,
in the event of any inconsistency or conflict between any terms or conditions
of this Agreement and any terms or conditions of any Purchase Order Form
submitted by EEI, the terms and conditions of this Agreement shall govern and
control to the full extent of such inconsistency or conflict.

 

                5.             Loading of Ethanol.  All Ethanol purchased by EEI under this
Agreement shall be made available to EEI at the Plant in gallons which have
been temperature corrected to sixty (60) degrees Fahrenheit.  EEI shall be responsible for arranging and
providing for the pick-up at the Plant of all Ethanol purchased by EEI under
this Agreement by truck carrier or by rail car carrier (in either case, each an
“EEI Carrier”) and for the subsequent delivery of all such Ethanol by each EEI
Carrier to whatever locations are desired by EEI.

 

If delivery of any Ethanol
by EEI will be by truck, the Ethanol will be made available F.O.B. the Plant
and shall otherwise be at EEI’s cost and expense, except only that IFEP will
provide the labor and Plant equipment necessary to load the Ethanol onto the
truck of the EEI Carrier at the Plant.

 

If delivery of any Ethanol
by EEI will be by rail car, the Ethanol will be made available F.O.B. the Plant
and shall otherwise be at EEI’s cost and expense, except only as may be
provided below in this Section and that IFEP will provide the labor and Plant
equipment necessary to load the Ethanol onto the rail car of the EEI Carrier at
the Plant.

 

EEI
shall, in consultation and with the prior approval and agreement of IFEP, (i)
estimate the number of rail cars required to handle the transportation of
Ethanol purchased by EEI pursuant to this Agreement; (ii) negotiate the lease
rates and other terms for the lease or leases of

 

5

 

such rail cars (collectively, the “Rail Car Leases”); and (iii) negotiate
the rates and other terms of such rail and freight contracts as are deemed
necessary by EEI and IFEP (collectively, the “Rail Contracts”).  All Rail Car Leases shall be entered into by,
and shall be in the name of, EEI and EEI shall fully and timely comply with all
of the terms and conditions of the Rail Car Leases, including, without
limitation, after the rail cars subject to the Rail Car Leases have been subleased
to IFEP as provided below.  EEI and IFEP
agree that the initial Rail Car Leases and related rail cars for purposes of
this Agreement are identified in Exhibit “D” to this Agreement (respectively,
the “Current Rail Car Leases” and the “Current Rail Cars”).  EEI represents and warrants to IFEP that EEI
has provided IFEP with a true, correct and complete copy of each of the Current
Rail Car Leases and that all of the Current Rail Car Leases permit the sublease
of the Current Rail Cars to IFEP upon the same terms and conditions as set
forth in the applicable Current Rail Car Lease.

 

If
this Agreement is terminated for any reason, including, but not limited to,
pursuant to Section 19(b) of this Agreement, IFEP shall sublease all of the
Current Rail Cars from EEI, upon the same terms and conditions as are provided
in the respective Current Rail Car Leases. 
EEI shall, notwithstanding any such sublease of any Current Rail Cars to
IFEP, be and remain responsible for any and all breaches of and defaults under
the Current Rail Car Leases by EEI.  All
payments required to be made under the Current Rail Car Leases after the
Current Rail Cars have been subleased to IFEP shall be made by IFEP to EEI, by
wire transfer, within ten (10) days of IFEP’s receipt of an invoice therefor
from EEI.  EEI will not invoice IFEP for
any amounts payable under the Current Rail Car Leases more than ten (10) days
in advance of the date such amounts are due under the applicable Current Rail
Car Lease.  Any such payments which are
not made by IFEP when due shall bear interest at the rate of ten percent (10%)
per annum from the date due until paid.

 

EEI
agrees to utilize its best efforts to include terms in any future Rail Car
Leases as may be agreed upon by EEI and IFEP which allow for the assignment of
the Rail Car Lease to IFEP or its successors and assigns at any time and for
any reason, without the consent of the lessor. 
If any future Rail Car Lease contains such assignment terms, such Rail
Car Lease shall be deemed to be automatically assigned by EEI to IFEP upon any
termination of this Agreement for any reason, including, but not limited to,
pursuant to Section 19(b) of this Agreement. 
If any future Rail Car Lease does not allow for assignment to IFEP, the
Rail Car Lease must permit the sublease of the rail cars subject to the Rail
Car Lease to IFEP, and in such circumstance, the rail cars will be subleased by
EEI to IFEP upon any termination of this Agreement as is otherwise provided
above with respect to the Current Rail Car Leases and the Current Rail
Cars.  EEI shall in all events be and
remain responsible for any and all breaches of and defaults under any future
Rail Car Leases by EEI.

 

All
Rail Contracts shall be in the name of IFEP.

 

All rental and other
amounts payable under the Rail Car Leases shall be timely paid by EEI.  EEI will, however, invoice IFEP for all such
rental and other amounts, and all such rental and other amounts will be
deducted from the next Purchase Price payable by EEI to IFEP unless IFEP pays
such rental and other amounts by wire transfer within ten (10) days of IFEP’s
receipt

 

6

 

of the invoice
from EEI.  EEI’s invoice shall include a
copy of any invoice received from the lessor under the Rail Car Lease in question.

 

IFEP will timely pay all
freight and other amounts payable under the Rail Contracts. IFEP will, however,
invoice EEI for all such freight and other amounts, and all such freight and
other amounts shall be payable by EEI by wire transfer within ten (10) days of
EEI’s receipt of IFEP’s invoice.  IFEP’s
invoice shall include a copy of any invoice received from the other party under
the Rail Contract in question.

 

As provided above, EEI
shall be responsible for the selection of the EEI Carriers, but IFEP reserves
the right to reject or to revoke any prior approval of any truck or rail car
carrier selected by EEI from time to time upon any reasonable basis and upon
fifteen (15) days notice.

 

EEI shall be responsible
for compliance with all laws, rules, regulations, ordinances and orders
applicable to the delivery, transportation and shipment of all Ethanol.

 

6.             Title and Risk of Loss.  The title to, and all risk of shipment, loss,
destruction or damage to all Ethanol purchased by EEI shall automatically pass
from IFEP to EEI at the time the Ethanol crosses the loading flange between the
Plant and the truck or the rail car, as the case may be, of the EEI Carrier.

 

                7.             Other Duties of EEI.  EEI will devote its best efforts and such
time as is necessary to diligently market and promote the sale of the entire
output of Ethanol from the Plant. 
Without limiting the generality of the foregoing, EEI agrees as follows:

 

(a)           EEI shall use its best efforts to
achieve the highest price for the Ethanol available under prevailing market
conditions and to enter into Value-Added Transactions.

 

(b)           EEI shall comply with all applicable
local, provincial, state, federal or other governmental laws, rules,
regulations, ordinances and orders.

 

(c)           EEI shall promptly notify IFEP of any
problems or questions raised by any customer of EEI with respect to any Ethanol
or EEI’s relationship or dealings with such customer regarding any Ethanol.

 

(d)           EEI shall advise IFEP of any matter
regarding any Ethanol which comes to the attention of EEI which raises an issue
of compliance of the Ethanol with any applicable local, provincial, state,
federal or other governmental laws, rules, regulations, ordinances or orders.

 

(e)           EEI shall obtain and continuously
maintain in effect any and all governmental or other consents, approvals,
authorizations, qualifications, registrations, licenses or permits which are
necessary or appropriate for EEI to fully and timely perform all of its
services, duties and obligations under this Agreement.

 

7

 

(f)            EEI shall not engage in any
negligent, illegal, deceptive, fraudulent or misleading acts or omissions in
connection with the performance of any services, duties or obligations under
this Agreement, including, without limitation, providing any deceptive,
fraudulent, misleading, false or incorrect information to IFEP or any customer
of EEI.

 

(g)           EEI will engage, at the sole cost and
expense of EEI, such number of personnel as are necessary for EEI to timely and
fully comply with the terms of this Agreement. 
All such personnel shall be employees, agents or independent contractors
of EEI and not of IFEP, and shall be bound by all of the terms and conditions
of this Agreement.  EEI shall be
responsible and liable for assuring full compliance by all such personnel with
all of the terms and conditions of this Agreement.

 

(h)           The facilities and equipment which
are utilized in connection with any inventory of Ethanol which is held by EEI
from time to time will be of the nature and quality which are necessary to
maintain the quality and condition of the Ethanol.

 

(i)            EEI shall have the sole and complete
responsibility for the collection of its accounts (including in all Value-Added
Transactions), and no delinquencies in any of those accounts shall affect EEI’s
duty to pay IFEP the Purchase Price for any Ethanol purchased by EEI pursuant
to this Agreement or any VAT Payments. 
All collection steps and procedures which are taken by EEI with respect
to any delinquent account regarding any Ethanol shall be in compliance with all
applicable laws, rules, regulations, ordinances and orders.

 

8.            Other Duties of IFEP; Storage
Limit.  IFEP shall utilize meters at
the Plant that measure both gross and net 60 degrees Fahrenheit temperature corrected
gallons of Ethanol.

 

IFEP
shall provide storage space at the Plant for not less than ten (10) full days
of production of Ethanol (the “Storage Limit”), based on the then current
nameplate design capacity of the Plant. 
EEI will immediately notify IFEP in writing (a “Storage Notice”) in the
event EEI determines that EEI will not, for whatever reason, remove some
Ethanol before the Storage Limit is exceeded. 
The giving of a Storage Notice does not, however, establish a waiver of
or otherwise relieve EEI of its duties and obligations under this
Agreement.  If EEI gives IFEP a Storage
Notice or otherwise does not remove some Ethanol before the Storage Limit is
exceeded, for whatever reason (including under Section 27 of this Agreement),
then IFEP may, in its discretion, but is not required to, sell or otherwise
dispose of such Ethanol as is necessary to cause the Storage Limit to not be
exceeded.  IFEP’s rights under this
paragraph include the right to sell or otherwise dispose of Ethanol which is
the subject of an Accepted Purchase Order, but only if such Ethanol is not
timely removed by EEI in accordance with this Agreement, in which event the
Accepted Purchase Order in question may, at IFEP’s option, be terminated by
IFEP, without IFEP having any liability to EEI.

 

IFEP
also agrees as follows:

 

8

 

(a)           IFEP shall comply with all applicable
local, provincial, state, federal or other governmental laws, rules,
regulations, ordinances and orders.

 

(b)           IFEP shall advise EEI of any matter
regarding any Ethanol which comes to the attention of IFEP which raises an
issue of compliance of the Ethanol with any applicable local, provincial,
state, federal or other governmental laws, rules, regulations, ordinances or orders.

 

(c)           IFEP shall obtain and continuously
maintain in effect any and all governmental consents, approvals,
authorizations, qualifications, registrations, licenses or permits which are
necessary or appropriate for IFEP to fully and timely perform all of its
services, duties and obligations under this Agreement.

 

(d)           IFEP shall not engage in any
negligent, illegal, deceptive, fraudulent or misleading acts or omissions in
connection with the performance of any services, duties or obligations under
this Agreement, including, without limitation, providing any deceptive,
fraudulent, misleading or false information to EEI.

 

(e)           IFEP will engage, at the sole cost
and expense of IFEP, such number of personnel as are necessary for IFEP to
timely and fully comply with the terms of this Agreement.  All such personnel shall be employees, agents
or independent contractors of IFEP and not of EEI, and shall be bound by all of
the terms and conditions of this Agreement. 
IFEP shall be responsible and liable for assuring full compliance by all
such personnel with all of the terms and conditions of this Agreement.

 

9.             Purchase Price and VAT Payments.  The purchase price for Ethanol under each
particular Accepted Purchase Order shall be the purchase price specified in the
Accepted Purchase Order (in each case, the “Purchase Price”).  The aggregate Purchase Price payable with
respect to all Ethanol which has been loaded onto the trucks or rail cars of
the EEI Carriers by Sunday of any given week and for which EEI has received a
bill of lading and a certificate of analysis by 11:59 a.m., Plant time, on that
Sunday shall be paid by EEI, in full, in United States dollars, by wire
transfer on or before the next following Thursday.  If EEI has not received a bill of lading and
a certificate of analysis with respect to some Ethanol on or before 11:59 a.m.
on a Sunday, payment for the Ethanol in question shall be made on the next
scheduled Purchase Price payment date which follows the date on which EEI
receives a bill of lading and a certificate of analysis for the Ethanol in
question.

 

The certificate of analysis
shall be in a format mutually agreeable to IFEP and EEI.  EEI acknowledges and agrees that each such
certificate of analysis may or may not be indicative of any future Ethanol, and
that no certificate of analysis is a representation or warranty by IFEP or
otherwise a part of this Agreement.

 

EEI shall also pay to IFEP, in addition to the Purchase
Price, an amount equal to [***] percent ([***]%) of the Net Profit Amounts (as
that term is defined below) that are to be received by EEI in all Value-Added
Transactions (as that term is also defined below).  The term “Value-Added Transaction” means any
transaction entered into by EEI for the sale or other

 

9

 

disposition of Ethanol purchased by EEI pursuant
to this Agreement which is different than the transaction that EEI had
originally established or entered into for the sale or other disposition of
such Ethanol by EEI (the “Original Transaction”), and pursuant to which EEI
obtains a net profit which is greater than the net profit that EEI would have
obtained if EEI had sold such Ethanol in strict accordance with the Original
Transaction.  Value-Added Transactions
may involve EEI establishing a different transaction or agreement with the
purchaser under the Original Transaction, or may involve EEI negotiating a
buyout from the Original Transaction, and may include freight savings, swaps,
bookouts, time exchanges, location exchanges, rack pricing and spread
differentials.  The term “Net Profit
Amounts” means the difference between the net profit to be received by EEI
pursuant to all Value-Added Transactions and the net profit which EEI was to
receive under the related Original Transactions.  The payments required to be made by EEI under
this paragraph (each, a “VAT Payment”) shall be paid by EEI quarterly, by wire
transfer, within thirty (30) days of the close of each calendar quarter.  Each VAT Payment shall be accompanied by
documentation evidencing the amount and basis for the VAT Payment in
question.  EEI agrees that the VAT
Payments with respect to each calendar year commencing with the 2005 calendar
year shall in no event be less than the Minimum VAT Amount (as that term is
defined below), regardless of whether EEI engaged in any Value-Added
Transactions during such calendar year or had sufficient Profit Amounts during
such calendar year, and if the VAT Payments otherwise made by EEI to IFEP with
respect to any calendar year do not equal or exceed the Minimum VAT Amount, the
final VAT Payment by EEI with respect to such calendar year shall be in such
amount as is necessary to cause the aggregate of the VAT Payments made by EEI
to IFEP with respect to that calendar year to equal the Minimum VAT
Amount.  The term “Minimum VAT Amount”
means the amount determined by multiplying (i) the number of gallons of Ethanol
purchased by EEI during the calendar year in question, by (ii) [***]¢.  By way of example, the Minimum VAT Amount in
the event EEI purchases 100,000,000 gallons of Ethanol during any given
calendar year will be $[***].

 

Any Purchase Price or VAT
Payment which is not made by EEI when due shall bear interest at the rate of
ten percent (10%) per annum from the date due until paid.

 

10.           Monthly Fee to EEI. 
IFEP shall pay EEI a monthly fee (the “Monthly Fee”) for all services
and materials provided by EEI pursuant to this Agreement in an amount
determined by multiplying (i) the number of gallons of Ethanol purchased by EEI
during the month in question, by (ii) $[***]. 
The Monthly Fee with respect to each month shall be payable, in arrears,
on or before the tenth day following IFEP’s receipt of an invoice therefor from
EEI.  Any Monthly Fee which is not paid
by IFEP when due shall bear interest at the rate of ten percent (10%) per annum
from the date due until paid.  IFEP
reserves the right, at its option and in its discretion, to elect to pay any
Monthly Fee by having EEI set off the Monthly Fee against, and withheld from,
the next scheduled Purchase Price to be paid by EEI.  IFEP may exercise this option from time to
time by providing notice thereof to EEI at any time within six (6) days of IFEP’s
receipt of EEI’s invoice for the Monthly Fee in question.

 

11.           Expenses of EEI. 
Except only as may be otherwise expressly and specifically provided for
herein, EEI shall pay and be solely responsible for all costs and expenses of
any nature whatsoever which are incurred by EEI in promoting, marketing,
selling and delivering the

 

10

 

Ethanol and otherwise in providing any
services pursuant to or in performing any duties or obligations under this
Agreement.

 

12.           Representations of EEI.  EEI represents and warrants to IFEP as
follows, both as of the date of this Agreement and again effective with each
Accepted Purchase Order:

 

(a)           EEI has and shall maintain
substantial knowledge of, and contacts and relationships within, the ethanol
industry, and EEI has and shall maintain substantial expertise in the marketing,
sale, distribution and transportation of ethanol.

 

(b)           EEI is a corporation duly organized,
validly existing and in good standing under the laws of the State under which
EEI was organized, and has and shall maintain all requisite power and authority
to own its property and carry on its business as now conducted and as to be
conducted pursuant to this Agreement.

 

(c)           This Agreement has been duly
authorized, executed and delivered by EEI, and constitutes the legal, valid and
binding obligation of EEI, enforceable in accordance with its terms.  EEI has and shall maintain all requisite
power and authority to enter into and perform this Agreement, and all necessary
actions and proceedings of EEI have been taken to authorize the execution,
delivery and performance of this Agreement.

 

(d)           The execution and performance of this
Agreement do not and will not conflict with, breach or otherwise violate any of
the terms or provisions of the organizational or governing documents of EEI or
of any agreement, document or instrument to which EEI is a party or by which
EEI or any of its assets or properties are bound.

 

(e)           There is no civil, criminal,
governmental or other litigation, action, suit, investigation, claim or demand
pending, or, to the knowledge of EEI, threatened against EEI, which may have a
material adverse effect upon the transactions contemplated by this Agreement or
EEI’s ability to perform its duties and obligations under, or to otherwise
comply with, this Agreement.

 

13.           Representations of IFEP.  IFEP represents and warrants to EEI as
follows, both as of the date of this Agreement and again effective with each
Accepted Purchase Order:

 

(a)           IFEP is a limited liability company
duly organized, validly existing and in good standing under the laws of the State
under which IFEP was organized, and has and shall maintain all requisite power
and authority to own its property and carry on its business as now conducted
and as to be conducted pursuant to this Agreement.

 

(b)           This Agreement has been duly
authorized, executed and delivered by IFEP, and constitutes the legal, valid
and binding obligation of IFEP, enforceable in accordance with its terms.  IFEP has and shall maintain all requisite
power and authority to enter into and perform this Agreement, and all necessary
actions and proceedings of

 

11

 

IFEP have been taken to
authorize the execution, delivery and performance of this Agreement.

 

(c)           The execution and performance of this
Agreement do not and will not conflict with, breach or otherwise violate any of
the terms or provisions of the organizational or governing documents of IFEP or
of any agreement, document or instrument to which IFEP is a party or by which
IFEP or any of its assets or properties are bound.

 

(d)           There is no civil, criminal,
governmental or other litigation, action, suit, investigation, claim or demand
pending, or, to the knowledge of IFEP, threatened against IFEP, which may have
a material adverse effect upon the transactions contemplated by this Agreement
or IFEP’s ability to perform its duties and obligations under, or to otherwise
comply with, this Agreement.

 

14.           Limited Warranty. 
IFEP represents and warrants to EEI that the Ethanol sold to EEI
pursuant to this Agreement will, in the form as loaded onto the truck or rail
car of the EEI Carrier, meet or exceed (but need not exceed) the specifications
set forth in Exhibit “C” to this Agreement (the “Specifications”) for a period
of ninety (90) days from the date of loading onto the truck or rail car, as the
case may be, of the EEI Carrier at the Plant (the “Warranty Period”).  The foregoing warranty will automatically be
void if the failure of any Ethanol to meet the Specifications has resulted in
any way from the condition or prior use of the truck or rail car of the EEI
Carrier, any act or omission of the EEI Carrier, EEI’s negligence, or from
accident, abuse, misapplication or an Impossibility Event.

 

If
any Ethanol fails to conform to the warranty set forth above in this Section 14
during the Warranty Period and EEI provides IFEP, before the close of the
Warranty Period, with (i) written notice of the failure, and (ii) satisfactory
written evidence and other proof of such failure, IFEP will replace the
Ethanol, at IFEP’s cost, with Ethanol which meets or exceeds (but need not
exceed) the Specifications within five (5) business days of IFEP’s receipt of
EEI’s written notice and evidence; provided, however, that in the event IFEP
has commitments for the sale of its entire production and inventory of Ethanol
over the next five (5) business day period, IFEP will reasonably cooperate with
EEI to replace the Ethanol in question with other Ethanol as soon as is
commercially practicable.  If IFEP
disagrees with EEI’s written notice or other written evidence, IFEP may have
the Ethanol in question or any samples of the shipment of Ethanol in question
which may have been retained by IFEP tested by an independent laboratory for
verification that the Ethanol did not meet the Specifications and/or the reasons
why the Ethanol did not meet the Specifications.  IFEP shall bear the costs for any such
testing; provided, however, that in the event the Ethanol in question is found
by the independent laboratory to be in conformance with the Specifications or
that the Ethanol failed to meet the Specifications because of any reason or
cause referred to in the first paragraph of this Section, then EEI shall accept
and pay for both the Ethanol and the replacement Ethanol provided by IFEP, and
shall also fully reimburse IFEP for all costs incurred in connection with the
testing of the Ethanol and the shipping and handling of the replacement
Ethanol, all within five (5) days of the demand therefore by IFEP.  EEI shall reasonably cooperate with IFEP in
the testing of any Ethanol pursuant to this paragraph.

 

12

 

15.          Exclusion of All Other Warranties.  Except only for the limited warranties expressly given in
Section 13 of this Agreement and for the limited warranty expressly given in
the first paragraph of Section 14 of this Agreement, IFEP makes no express
warranties whatsoever regarding any Ethanol or any other thing or matter
whatsoever, and IFEP hereby excludes and disclaims in entirety all implied
warranties whatsoever, including, without limitation, the implied warranties of
merchantability, noninfringement and fitness for a particular purpose, with
respect to all Ethanol and all other things or matters whatsoever.

 

16.          Limitation of Liability; Statute of
Limitations.  Neither IFEP nor EEI makes any
warranty, express or implied, to the other of profit or of any particular
economic results from the transactions contemplated by this Agreement.  Under no circumstances or theories shall IFEP
or EEI be liable to the other for any lost profits, business or goodwill, or
for any exemplary, special, incidental, consequential, punitive or indirect
damages whatsoever, which are in any way related to or connected with or arise
out of this Agreement (and even if IFEP or EEI, as the case may be, knew or
should have known of the possibility of any of those damages), including,
without limitation, to, with or out of any performance or nonperformance of any
Ethanol or by EEI or IFEP, or EEI’s use of or inability to use any Ethanol
(whether alone or in connection with or as part of other goods or products) or
any other goods or products for any reason and for any purpose whatsoever;
provided, however, that the foregoing shall not be applicable to, and neither
IFEP nor EEI waive any losses or damages that result or arise from, any breach
of Sections 23 or 24 of this Agreement, or any negligent or reckless act or
omissions of, or willful misconduct by, the other.  Any claim, suit or action for any breach or
nonfulfillment of or default under any term or condition of this Agreement must
be commenced within two (2) years of the date the cause of action accrued, or
such claim, suit or action shall be lost and forever barred.

 

IFEP
and EEI each also hereby absolve and release the other from, and agree to refrain
from seeking any claims, suits, actions or remedies whatsoever against the
other for, any and all losses, claims, damages, costs, suits and liabilities
for deterioration of quality, shrinkage in quantity, or loss of grade of
Ethanol resulting from the inherent nature of loading operations and the
inherent nature of Ethanol, provided, however, that this paragraph is in no way
intended or shall be interpreted to relieve either IFEP or EEI for their own
negligence, willful misconduct or theft.

 

17.           Insurance. 
At all times during the term of this Agreement, EEI will maintain in
full force and effect a policy or policies of commercial general liability
insurance with combined single limits of not less than $2,000,000.  EEI shall provide evidence of such insurance
to IFEP upon the request of IFEP from time to time.

 

At
all times during the term of this Agreement, IFEP will maintain in full force
and effect a policy or policies of commercial general liability insurance with
combined single limits of not less than $2,000,000.  IFEP shall provide evidence of such insurance
to EEI upon the request of EEI from time to time.

 

18.          Grant of Security Interest by EEI.  EEI hereby grants to IFEP a security interest
in and to all of the Ethanol which is at any time sold by IFEP to EEI, with
such security interest to

 

13

 

secure payment of all amounts payable by EEI
to IFEP under this Agreement and the performance of all of the other duties and
obligations of EEI under this Agreement, whether now existing or hereafter
arising.  EEI will be in breach of and
default under the security interest granted by this Section upon the failure to
make any payment, when due and payable, of any amounts payable under this
Agreement, or upon the breach or nonfulfillment of or default under any other
term or condition of this Agreement. 
After the occurrence of any such breach, nonfulfillment or default, IFEP
may exercise at any time and from time to time any and all rights and remedies
available to a secured party under applicable law.

 

19.           Term and Termination.  The term of this Agreement shall commence on
the date hereof and shall continue thereafter for a period of one (1) year (the
“Initial Term”), and shall be automatically renewed thereafter for successive
terms of two (2) years each (each, a “Renewal Term”), unless either IFEP or EEI
provides the other with written notice of its desire to not renew this
Agreement, for any reason or for no reason, at least forty-five (45) days prior
to the close of the Initial Term or the Renewal Term then in effect or this
Agreement is earlier terminated pursuant to any other provision of this
Agreement.

 

This Agreement may or will
be, as the case may be, terminated in accordance with any of the following:

 

(a)           This Agreement may be terminated by
IFEP at any time, with or without cause, for any reason or for no reason,
effective ninety (90) days following the giving of written notice thereof to
EEI by IFEP.

 

(b)          This Agreement may be terminated by
IFEP or by EEI in the event of any breach or nonfulfillment of or default under
any term or condition of this Agreement by the other, which breach,
nonfulfillment or default is not fully cured within twenty (20) days, or eight
(8) days in the event of nonpayment of an amount due, following the giving of
written notice thereof to the breaching party by the nonbreaching party;
provided, however, that this Agreement may be terminated by IFEP or by EEI, as
the case may be, effective upon the giving of written notice pursuant to this
subparagraph (b), and without any opportunity for cure by the other, if they
have previously provided the other with bona fide written notices pursuant to
this subparagraph (b) on at least three (3) or more prior occasions during the
Initial Term or the Renewal Term then in effect.

 

(c)           This Agreement may be terminated by
IFEP or by EEI, effective upon the giving of written notice thereof to the
other, in the event of the dissolution or liquidation of, termination of
existence of, insolvency of, business failure of, appointment of a receiver of
or for any part of the property of, assignment for the benefit of creditors by,
or the commencement of any proceeding (whether voluntary or involuntary) under
any bankruptcy, insolvency, debtor/creditor, receivership or similar or related
law by or against the other, and which proceeding is not dismissed within sixty
(60) days of the commencement thereof.

 

(d)           This Agreement may be terminated by
IFEP or by EEI if such termination is required by any governmental or
regulatory authority, and any such termination shall

 

14

 

be effective on the earlier
of:  (i) the date required by such
governmental or regulatory authority, or (ii) the thirtieth day following the
giving of written notice of termination pursuant to this subparagraph (d) by
IFEP or EEI, as the case may be, to the other.

 

20.          Transactions Upon and After
Termination.  In addition to any
other provisions hereof addressing the rights or obligations of IFEP or EEI
upon or after the termination of this Agreement, IFEP and EEI agree that upon
the termination of this Agreement, for whatever reason or no reason:

 

(a)           IFEP shall satisfy and fulfill any
Purchase Orders which became Accepted Purchase Orders before the earlier of (i)
the giving of any notice pursuant to Section 19 of this Agreement, or (ii) the
effective date of the termination of this Agreement; provided, however, that
IFEP shall not be obligated to fill any Accepted Purchase Order in the event of
the giving of any notice by IFEP pursuant to, or the termination of this
Agreement by IFEP pursuant to, Section 19(b) or Section 19(c) of this
Agreement, and any such Accepted Purchase Orders which IFEP determines, in its
sole discretion, not to fill shall be deemed to be canceled and terminated and
IFEP shall have no responsibility or liability therefor.

 

(b)          EEI shall satisfy and comply with any
Purchase Orders which became Accepted Purchase Orders before the earlier of (i)
the giving of any notice pursuant to Section 19 of this Agreement, or (ii) the
effective date of the termination of this Agreement; provided, however, that
EEI shall not be obligated to purchase according to any Accepted Purchase Order
in the event of the giving of any notice by EEI pursuant to, or the termination
of this Agreement by EEI pursuant to, Section 19(b) or Section 19(c) of this
Agreement, and any such Accepted Purchase Orders which EEI determines, in its
sole discretion, not to comply with shall be deemed to be canceled and
terminated and EEI shall have no responsibility or liability therefor, and IFEP
shall be free to sell or otherwise dispose of the Ethanol which was subject to
such Accepted Purchase Orders.

 

(c)           All amounts owing by IFEP to EEI, or
by EEI to IFEP, under this Agreement, shall be paid in full by IFEP to EEI or
by EEI to IFEP, as the case may be, by the earlier of (i) the normal and
ordinary course payment date as otherwise provided in this Agreement, or (ii)
the date which is ten (10) days following the effective date of the termination
of this Agreement.

 

The
termination of this Agreement, for whatever reason or for no reason, shall not
affect any liability or obligation of IFEP or EEI hereunder which shall have
accrued prior to or as a result of such termination, including, but not limited
to, any liability for loss or damage on account of breach, nor shall the
termination of this Agreement, for whatever reason or for no reason, affect the
terms or provisions hereof which contemplate performance by or continuing
obligations of IFEP and/or EEI beyond the termination hereof, including,
without limitation, the respective obligations of IFEP and EEI under Sections
23 and 28 of this Agreement.

 

21.           Additional Rights
of IFEP and EEI.  Notwithstanding
anything in this Agreement which may appear to be to the contrary, IFEP
reserves the right to reject Purchase Orders and to

 

15

 

withhold
fulfilling any and all Accepted Purchase Orders during any period of time that
EEI is in breach or nonfulfillment of or default under any payment term or
payment condition of this Agreement. 
IFEP also reserves the right to terminate or withhold fulfilling any
Accepted Purchase Order under the circumstances and as provided in Sections 8 and
20(a) of this Agreement, as well as all rights under the applicable Uniform
Commercial Code, including, without limitation, the right to demand and receive
adequate assurances of performance by EEI.

 

Notwithstanding anything in this Agreement which may appear to be to
the contrary, EEI reserves the right to not submit Purchase Orders and to
withhold purchasing under any and all Accepted Purchase Orders during any
period of time that IFEP is in breach or nonfulfillment of or default under any
payment term or payment condition of this Agreement.  EEI also reserves the right to terminate or
not be obligated to purchase according to any Accepted Purchase Order under the
circumstances and as provided in Section 20(b) of this Agreement, as well as
any rights under the applicable Uniform Commercial Code, including, without
limitation, any right to demand and receive adequate assurances of performance
by IFEP.

 

22.           All Rights
Reserved by IFEP and EEI.  IFEP and
EEI each reserve all of their respective patent, copyright, trade secret,
trademark, service mark, proprietary or confidential information, and
intellectual property rights, and this Agreement does not grant either party
any license, right to use or other right, title or interest in or to any
patents, copyrights, trade secrets, trademarks, service marks, proprietary or
confidential information, or intellectual property rights or properties
whatsoever of the other party, except only to the limited extent that the use
of proprietary or confidential information may be expressly permitted under
Section 23 of this Agreement.

 

23.           Confidential
Information.  IFEP and EEI
acknowledge that they may have access to certain proprietary or confidential
information of the other and that such information constitutes valuable,
special and unique property of the other. 
IFEP and EEI agree that they will not, at any time during the term of
this Agreement or for a period of five (5) years after the termination of this
Agreement (whether this Agreement is terminated by IFEP or EEI and with or
without cause, for any reason or for no reason), in any fashion, form or
manner, either directly or indirectly, use for their own or another’s benefit,
or divulge, disclose or communicate to any person in any manner whatsoever, any
such proprietary or confidential information; provided, however, that (i) IFEP
may make disclosures regarding this Agreement and the transactions contemplated
hereby to the extent IFEP deems necessary or appropriate or as may be required
in connection with any debt or equity financing or insurance coverage as may
from time to time be pursued or obtained by IFEP or any Affiliate of IFEP,
including to prospective or actual lenders and investors and to actual or
potential assignees or transferees of any such lender or in connection with a
foreclosure, assignment in lieu of foreclosure or other exercise of any rights
or remedies by any such lender; (ii) EEI may make disclosures regarding this
Agreement and the transactions contemplated hereby to the extent EEI deems necessary
or appropriate or as may be required in connection with any debt or equity
financing or insurance coverage as may from time to time be pursued or obtained
by EEI or any Affiliate of EEI, including to prospective or actual lenders and
investors and to actual or potential assignees or transferees of any such
lender or in connection with a foreclosure, assignment in lieu of foreclosure
or other exercise of any rights or remedies by any such lender; (iii) IFEP and
EEI may make disclosures regarding this Agreement

 

16

 

and
the transactions contemplated hereby to their respective legal counsel and
accountants; and (iv) the reasonable use of any proprietary or confidential
information as part of or in connection with the transactions contemplated by
this Agreement during the term of this Agreement is permitted.

 

For purposes of this Agreement, the term “proprietary or confidential
information” shall mean all information, documentation or financial data which
is proprietary or confidential in nature and which is used by or belongs or
relates to IFEP or EEI, as the case may be, and which is disclosed or made
available to or otherwise obtained by the other, its employees or agents, and
includes but is not limited to, the prices charged for services hereunder or
any other information concerning the other’s business, manner of operation,
plans, processes or other data of any kind. 
“Proprietary or confidential information” shall not include, however,
any of the following information and/or types of information:  (i) information of IFEP or EEI, as the case
may be, that at the time furnished to the other is in the public domain or
later becomes part of the public domain by publication or otherwise through no
fault of the other or its employees or agents; (ii) information of IFEP or EEI,
as the case may be, that was independently developed by the other by persons
without access to or knowledge of, or any use of, the proprietary or
confidential information of IFEP or EEI, as the case may be; or (iii)
information of IFEP or EEI, as the case may be, that was obtained by the other
on a nonconfidential basis from a person entitled to disclose the information.

 

                If the proprietary or
confidential information of IFEP or EEI, as the case may be, is required to be
disclosed by the other by court order, governmental action, legal process or
applicable law, such party shall, if legally permissible, first give written
notice thereof to the other party whose confidential information is to be
disclosed and reasonably cooperate with such party (at such party’s cost and
expense) in such party’s attempt to obtain a protective order or waiver or
exclusion from the court or other applicable governmental or other authority or
law.

 

                IFEP and EEI agree that the
other would be irreparably damaged by reason of their violation of any of the
provisions contained in this Section 23 and that any remedy at law for a breach
of such provisions would be inadequate, and that they shall each be entitled to
seek injunctive or other equitable relief in a court of competent jurisdiction
against the other or its employees or agents for any breach or threatened
breach of any of the provisions contained in this Section 23 without the
necessity of proving actual monetary loss or posting any bond or other form of
collateral or security.  It is expressly
understood that the remedy described in this Section 23 shall not be the
exclusive remedy for any breach of this Section 23.

 

                Nothing in this Section 23 is
intended or shall be construed as requiring either IFEP or EEI to furnish any
proprietary or confidential information to the other, except only to the
limited extent, if any, as may be necessary for the other to perform and
provide its services and duties under this Agreement.

 

24.           Noncompete
Covenant.  EEI covenants and agrees
that during the term of this Agreement, EEI will not, directly or indirectly,
become an investor in or provide any services, goods or materials to or for, or
otherwise become interested, associated or concerned in any way in or with, any
ethanol plant which is located anywhere within a [***] mile radius of the
location

 

17

 

of
the Plant, other than an ethanol plant owned or operated by IFEP or an Affiliate
of IFEP.  IFEP’s remedies upon a breach
or imminent breach of this Section include the right to preliminary and
permanent injunctive relief restraining EEI from any further violation of this
Section, and without the posting of any bond or other form of collateral or
security.  EEI acknowledges and warrants
that enforcement of a remedy by way of injunction will not prevent EEI from
earning a livelihood or work an undue hardship on EEI, and that injunctive
relief is necessary and appropriate to protect the justifiable business
interests of IFEP.  Notwithstanding the
foregoing, IFEP acknowledges that this Section 24 does not limit or prohibit
EEI from purchasing ethanol from, or providing marketing services to, the plant
owned by [***] which is located in or around [***], [***], and that this
Section 24 does not limit or prohibit EEI from (i) entering into Value Added
Transactions with plants that are located within the [***]-mile radius
specified above, or (ii) making isolated, opportunistic purchases from time to
time of ethanol from a plant otherwise located in the [***]-mile radius
specified above.

 

                25.           IFEP and EEI Representative.  IFEP shall designate to EEI in writing one or
more representatives of IFEP through whom all contacts from EEI pursuant to
this Agreement may be made, and, unless otherwise specified in this Agreement,
each such representative shall be deemed to have full authority to make all
decisions and to resolve all matters, disputes and issues under this Agreement
on IFEP’s behalf.  IFEP may change its
representative or representatives from time to time for any reason or no
reason, effective upon the giving of written notice to EEI.

 

                EEI shall designate to IFEP in
writing one or more representatives of EEI (each, an “EEI Representative”)
through whom all contacts from IFEP pursuant to this Agreement may be made,
and, unless otherwise specified in this Agreement, each such representative
shall be deemed to have full authority to make all decisions and to resolve all
matters, disputes and issues under this Agreement on EEI’s behalf.  EEI may change its representative or
representatives from time to time for any reason or no reason, effective upon
the giving of written notice to IFEP.

 

26.           Nature of Relationship; Authority
of Parties.  Nothing contained in
this Agreement and no action taken or omitted to be taken by IFEP or EEI
pursuant hereto shall be deemed to constitute IFEP and EEI a partnership, an
association, a joint venture or other entity whatsoever.  This Agreement is not intended and shall not
be construed to constitute IFEP or EEI to be an agent of the other or to cause
IFEP or EEI to be responsible in any way for the acts, omissions, debts,
liabilities or obligations of the other (including, without limitation, any
liability arising from any negligent or other acts or omissions of the other).
Neither IFEP nor EEI have the authority to bind the other in any respect
whatsoever.  Without limiting the
generality of the foregoing, neither IFEP nor EEI have any responsibility for
the completion or performance of the other’s contracts and agreements with
their customers, suppliers or other persons.

 

27.           Impossibility.  Notwithstanding anything in this Agreement
which may appear to be to the contrary, if any term or condition of this Agreement
to be performed or observed by IFEP or EEI (except for payment obligations and
under Sections 23 and 24) is rendered impossible of performance or observance
due to any force majeure or any other act, omission, matter, circumstance,
event or occurrence beyond the reasonable control of IFEP or EEI, as the case
may be (each, an “Impossibility Event”), IFEP or EEI, as the case may be,
shall, for so long as such Impossibility Event exists, be excused from such
performance or observance, provided

 

18

 

that
the affected party notifies the other in writing within twenty-four (24) hours
of the occurrence of the Impossibility Event and takes all appropriately
reasonable steps as soon as reasonably practicable upon the termination of the
Impossibility Event to recommence performance or observance; provided, however,
that if after forty-five (45) days from the onset of the Impossibility Event,
IFEP or EEI is still unable to perform their obligations hereunder, either IFEP
or EEI may, in their respective discretion, terminate this Agreement effective
upon the giving of written notice thereof to the other.  The term “Impossibility Event” includes,
without limitation, fire, storm, flood, earthquake, acts of God, civil disturbances
or disorders, an actual or threatened act or acts of war, an actual or
threatened act or acts of terrorism, computer failures, computer viruses, acts
of computer hackers, sabotage, strikes, lockouts, labor disputes, labor
shortages, stoppages or slowdowns initiated by labor, transportation embargos,
failure or shortage of supplies or materials, accidents, equipment or
mechanical failures, or acts or regulations or priorities of any governmental
authority or branches or agencies thereof.

 

28.
          Indemnification.  Subject to the limitation of EEI’s liability
under Section 16 of this Agreement, EEI shall defend, indemnify, and hold IFEP
harmless from and against any loss, claim, liability, damage, cost or expense
(including, without limitation, attorneys’ fees and court costs) arising in
connection with or resulting from (i) EEI’s marketing, sale or use of Ethanol
and any other goods or products, and/or (ii) any breach or nonfulfillment of or
default under any term or condition of this Agreement on the part of EEI (or
any employee, agent or other personnel of EEI).

 

Subject
to the exclusions and limitations on EEI’s remedies and on the liability of
IFEP as provided in Sections 14, 15 and 16 of this Agreement, IFEP shall
defend, indemnify and hold EEI harmless from and against any loss, claim,
liability, damage, cost or expense (including, without limitation, attorneys’
fees and court costs) arising in connection with or resulting from any breach
or nonfulfillment of or default under any term or condition of this Agreement
on the part of IFEP (or any employee, agent or other personnel of IFEP).

 

29.           No Waiver; Modifications in
Writing.  No failure or delay on the
part of any party in exercising any right, power or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
such right, power or remedy preclude any other or further exercise thereof or
the exercise of any other right, power or remedy.  Except as may be otherwise expressly provided
herein (including, without limitation, as provided in Sections 14, 15 and 16 of
this Agreement), the remedies provided herein are cumulative and are not
exclusive of any remedies that may be available to any party at law or in
equity or otherwise.  No amendment,
modification, supplement or waiver of or to any provision of this Agreement, or
consent to any departure therefrom, shall be effective unless the same shall be
in writing and signed by each of the parties hereto.  Any amendment, modification or supplement of
or to any provision of this Agreement, any waiver of any provision of this
Agreement, and any consent to any departure from the terms of any provision of
this Agreement, shall be effective only in the specific instance and for the
specific purpose for which made or given.

 

               30.           Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Iowa, but without regard
to provisions thereof relating to conflicts of law.

 

19

 

31.           Consent to Jurisdiction.  Each of the parties submits to the
nonexclusive jurisdiction of any United States or Iowa court sitting in Des
Moines, Iowa in any action or proceeding arising out of or relating to this
Agreement.  Each party agrees that all
claims and counterclaims with respect to any such action or proceeding may be
heard and determined in any such courts, and waives any objection, including,
without limitation, any objection to the laying of venue or based on the
grounds of forum non conveniens, which it may now or hereafter have to
the bringing of any such action or proceeding in any such courts.  Each of the parties consents to the service
of any and all process in any such action or proceeding by the personal service
of copies of such process to the party, at its address specified for notices to
be given hereunder.

 

32.           Waiver of Jury Trial.  Each of the parties hereby unconditionally waives any right
to a jury trial with respect to and in any action, suit, proceeding, claim,
counterclaim, demand, dispute or other matter whatsoever arising out of this
Agreement.

 

33.           Assignment. 
Neither IFEP nor EEI shall have the right to assign this Agreement
without the prior written consent of the other, which consent shall not be
unreasonably withheld, delayed or conditioned; provided, however, that IFEP
may, without the consent of EEI, (i) assign its rights and obligations under
this Agreement to any Affiliate of IFEP or in connection with any sale of all
or substantially all of the assets of IFEP, and (ii) assign this Agreement as
security, collateral or otherwise to any lender of IFEP or any Affiliate of
IFEP, and any such lender may in turn assign this Agreement upon any
foreclosure or other exercise of any rights or remedies against IFEP or any
Affiliate of IFEP.  IFEP will, however,
provide EEI with written notice of any such assignment by no later than five
(5) business days after the effective date of the assignment.

 

34.           Binding Effect on Successors and Assigns.  This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors,
legal representatives and assigns. 
Nothing in this Agreement, express or implied, is intended to confer
upon any person other than the parties hereto (and their respective successors,
legal representatives and assigns) any rights, remedies, liabilities or
obligations under or by reason of this Agreement.

 

                35.           Giving of Notice.  Except as may be otherwise provided in this
Agreement, all notices, demands, requests, and other communications desired or
required to be given hereunder  (“Notices”)
shall be in writing and shall be given by: (i) hand delivery to the address for
Notices; (ii) delivery by overnight courier service to the address for Notices;
or (iii) sending the same by United States mail, postage prepaid, certified
mail, return receipt requested, addressed to the address for Notices.

 

               All Notices shall
be deemed given and effective upon the earlier to occur of: (i) the hand
delivery of such Notice to the address for Notices; (ii) one (1) business day
after the deposit of such Notice with an overnight courier service by the time
deadline for next day delivery addressed to the address for Notices; or (iii)
three (3) business days after depositing the Notice in the United States mail
as set forth above in this Section 35. 
All Notices shall be addressed to

 

20

 

the addresses set forth below the signatures to this Agreement, or to
such other person or at such other place as any party hereto may by Notice
designate as a place for service of Notice.

 

36.           Severability. 
If any term of this Agreement is held to be invalid, illegal or
unenforceable, in whole or in part, the remaining terms of this Agreement will
not be affected thereby and will continue to be valid, legal and
enforceable.  If any term of this
Agreement is held to be invalid, illegal or unenforceable as written, but
valid, legal and enforceable if modified, then such term shall be deemed to be
written and construed, and shall be enforced, as so modified.  Any finding of invalidity, illegality or
unenforceability in any jurisdiction shall not invalidate or render illegal or
unenforceable such term in any other jurisdiction.  Without limiting the generality of the foregoing,
each term of this Agreement which provides for a limitation of remedies or
liability, disclaimer or exclusion of warranties, or exclusion or limitation of
damages is subject to this Section. 
Further, if any remedy is determined to have failed of its essential
purpose or otherwise, all limitations of liability and exclusions and
limitations of damages provided for in this Agreement will remain in full force
and effect.

 

                37.           Entire Agreement. 
This Agreement, all exhibits and schedules hereto, and, subject to
Section 4 of this Agreement, each Purchase Order Form for each Accepted
Purchase Order, constitute the entire agreement between the parties hereto
pertaining to the subject matters hereof, and supersede all negotiations,
preliminary agreements and all prior or contemporaneous discussions and
understandings of the parties hereto in connection with the subject matters
hereof.  No course of dealing or usage of
trade shall be relevant or admissible to supplement or vary any of the terms of
this Agreement.  All exhibits and
schedules to this Agreement are incorporated into this Agreement as if set
forth in their entirety and constitute a part hereof.

 

38.           Miscellaneous. 
The titles or captions of sections and paragraphs in this Agreement are
provided for convenience of reference only and shall not be considered a part
hereof for purposes of interpreting or applying this Agreement, and such titles
or captions do not define, limit, extend, explain or describe the scope or
extent of this Agreement or any of its terms or conditions.  This Agreement shall not be construed more
strongly against any party, regardless of who was more responsible for its
preparation.  Words and phrases herein
shall be construed as in the singular or plural number and as masculine, feminine
or neuter gender, according to the context. 
The use of the words “herein,” “hereof,” “hereunder” and other similar
compounds of the word “here” refer to this entire Agreement and not to any
particular section, paragraph or provision. 
The term “person” and words importing persons as used in this Agreement
include firms, associations, partnerships, limited partnerships, joint
ventures, trusts, corporations and other legal entities, including public or
governmental bodies, agencies or instrumentalities, as well as natural
persons.  This Agreement may be executed
by the parties hereto on any number of separate counterparts (including by
facsimile or e-mail transmission), and all of said counterparts taken together
shall be deemed to constitute one and the same agreement.

 

21

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the
15th day of November, 2004.

 

	
  IOWA FALLS ETHANOL PLANT,
  L.L.C.

  	
   

  	
  ECO-ENERGY, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Russell Stidolph

  	
   

  	
  By: 

  	
  /s/ Larry Beckwith

  
	
  Name: 

  	
  Russell Stidolph

  	
   

  	
  Name: Larry Beckwith

  
	
  Title: 

  	
  Manager

  	
   

  	
  Title: President

  
	
   

  	
   

  	
  730
  Cool Springs Blvd., Suite 130

  
	
  Address

  	
   

  	
  Franklin,
  TN 37067

  
	
  21050
  140th Street

  	
   

  	
  Facsimile
  Number:

  	
   

  
	
  Iowa
  Falls, IA 50126

  	
   

  	
   

  	
   

  
							

 

 

 

 

Exhibit
A -             Fixed Ethanol Purchase
Order Form [Section 4]

Exhibit
B -              Posted Price Ethanol
Purchase Order Form [Section 4]

Exhibit
C -              Specifications [Section
14]

Exhibit
D -              List of Current Rail Car
Leases and Current Rail Cars [Section 5]

 

22

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