Opinion ID: 1709084
Heading Depth: 1
Heading Rank: 5

Heading: Service Requirements Agreement

Text: Under this agreement between the Department and Henderson, the latter agrees to cause its entire requirements for the processing of raw sugar to be presented at the plant facilities for processing, and the Department agrees to process and package the raw sugar so presented and to extract and package the molasses and any other byproducts resulting from the refining process. The respective obligations of the Department and Henderson as to the said processing requirements are limited to the capacity of the plant facilities; and the Department reserves the right to render services from the plant facilities to others than Henderson whenever any part of the capacity of the plant facilities may not at the time be in use rendering service to Henderson. In the service requirements agreement Henderson agrees to pay to the Department sums that will assure receipt by the Department of revenues from the plant facilities sufficient (a) to pay the rent payable by the Department to the City under the project lease; (b) to pay all costs incurred by the Department in the operation, maintenance and improvement of the plant facilities, including all compensation to and reimbursement of the operating company under the employment agreement (except that part of said costs paid by other customers of the Department); and (c) to yield a profit to the Department that will become a part of its general operating revenues. All obligations of Henderson under the service requirements agreement will continue regardless of whether Henderson has any requirements for the processing of sugar, and regardless of whether all or any part of the plant facilities should be damaged or destroyed or taken in the exercise of eminent domain, and regardless of any acts or circumstances that may constitute commercial frustration of purpose. The aforesaid payments by Henderson will be in addition to the charges by the Department for services rendered to Henderson by the Department at the wharf facilities. The service requirements agreement will extend for a period of thirty years from the completion of the project, subject to rights of prior termination by the Department in the event of default by Henderson.