LUMP SUM DESIGN-BUILD AGREEMENT
BETWEEN
GREEN PLAINS RENEWABLE ENERGY, INC. ("OWNER")
AND
FAGEN, INC. ("DESIGN-BUILDER")
January 13, 2005
<PAGE>
TABLE OF CONTENTS
Page
Article 1 Definitions, Rules of
Interpretation................................1
1.1 Rules of
Construction.............................................1
1.2 Defined
Terms.....................................................2
Article 2 The
Project.........................................................6
2.1 Services
to be Performed..........................................6
2.2 Extent of
Agreement...............................................6
2.3
Conflicting
Provisions............................................7
Article 3 Design-Builder
Responsibilities.....................................7
3.1
Design-Builder's Services in
General..............................7
3.2 Design
Development and Service....................................7
3.3 Standard
of Care..................................................9
3.4 Government
Approvals and Permits..................................9
3.5
Subcontractors....................................................9
3.6
Maintenance of
Site..............................................10
3.7 Project
Safety...................................................10
3.8 Submission
of Reports............................................10
3.9
Training.........................................................11
Article 4 Owner's
Responsibilities...........................................11
4.1 Duty to
Cooperate................................................11
4.2 Furnishing
of Services and Information...........................11
4.3 Financial
Information; Cooperation with Lenders; Failure to
Obtain Financial
Closing.......................................12
4.4 Owner's
Representative...........................................13
4.5 Government
Approvals and Permits.................................13
4.6 Owner's
Separate Contractors.....................................13
4.7
Security.........................................................13
Article 5 Ownership of Work Product; Risk of
Loss............................14
5.1 Work
Product.....................................................14
5.2 Owner's
Limited License Upon Payment in Full.....................14
5.3 Owner's
Limited License Upon Owner's Termination for
Convenience or Design-Builder's Election to
Terminate..........15
5.4 Owner's
Limited License Upon Design-Builder's Default............15
5.5 Owner's
Indemnification for Use of Work Product..................15
5.6 Risk of
Loss.....................................................16
Article 6 Commencement and Completion of the
Project.........................16
6.1 Work
Schedule....................................................16
6.2 Phase I
and Phase II Engineering.................................16
i
Green Plains Renewable Energy, Inc.
January 13, 2006
<PAGE>
Table of Contents
(continued)
Page
6.3 Notice to
Proceed; Commencement..................................17
6.4 Project
Start-Up and Testing.....................................17
6.5
Substantial
Completion...........................................17
6.6 Final
Completion.................................................19
6.7
Post-Completion
Support..........................................20
Article 7 Performance Testing and Liquidated
Damages.........................20
7.1
Performance
Guarantee............................................20
7.2
Performance
Testing..............................................21
7.3 Liquidated
Damages...............................................22
7.4 Bonds and
Other Performance Security.............................22
Article 8
Warranties.........................................................23
8.1
Design-Builder
Warranty..........................................23
8.2 Correction
of Defective Work.....................................24
8.3 Warranty
Period Not Limitation to Owner's Rights.................24
Article 9 Contract
Price.....................................................25
9.1 Contract
Price...................................................25
Article 10 Payment
Procedures................................................25
10.1
Payment at Financial
Closing.....................................25
10.2
Progress
Payments................................................25
10.3
Final
Payment....................................................26
10.4
Failure to Pay Amounts
Due.......................................27
10.5
Design-Builder's Payment
Obligations.............................27
10.6
Record Keeping and Finance
Controls..............................27
Article 11 Hazardous Conditions and Differing Site
Conditions................27
11.1
Hazardous
Conditions.............................................27
11.2
Differing Site Conditions;
Inspection............................28
Article 12 Force Majeure; Change in Legal
Requirements.......................29
12.1
Force Majeure
Event..............................................29
12.2
Effect of Force Majeure
Event....................................29
12.3
Change in Legal
Requirements.....................................30
12.4
Effect of Industry-Wide Disruption on Contract
Price.............30
12.5
Time
Impact and Availability.....................................31
Article 13 Changes to the Contract Price and Scheduled Completion
Dates......31
13.1
Change
Orders....................................................31
13.2
Contract Price
Adjustments.......................................31
13.3
Emergencies......................................................32
13.4
Requests for Contract Adjustments and
Relief.....................32
Article 14
Indemnity.........................................................33
ii
Green Plains Renewable Energy, Inc.
January 13, 2006
<PAGE>
Table of Contents
(continued)
Page
14.1
Tax
Claim Indemnification........................................33
14.2
Payment Claim
Indemnification....................................33
14.3
Design Builder's General
Indemnification.........................33
14.4
Owner's General
Indemnification..................................34
Article 15 Stop Work; Termination for
Cause..................................34
15.1
Owner's Right to Stop
Work.......................................34
15.2
Owner's Right to Perform and Terminate for
Cause.................34
15.3
Owner's Right to Terminate for
Convenience.......................36
15.4
Design-Builder's Right to Stop
Work..............................36
15.5
Design-Builder's Right to Terminate for
Cause....................37
15.6
Bankruptcy of Owner or
Design-Builder............................37
15.7
Lenders' Right to
Cure...........................................38
Article 16 Representatives of the
Parties....................................38
16.1
Designation of Owner's
Representatives...........................38
16.2
Designation of Design-Builder's
Representatives..................39
Article 17
Insurance.........................................................39
17.1
Insurance........................................................39
17.2
Design-Builder's Insurance
Requirements..........................40
17.3
Owner's Liability
Insurance......................................41
17.4
Owner's Property
Insurance.......................................41
17.5
Coordination with Loan
Documents.................................43
Article 18 Representations and
Warranties....................................43
18.1
Design-Builder and Owner Representations and
Warranties..........43
18.2 Design-Builder
Representations and Warranties....................44
Article 19 Dispute
Resolution................................................44
19.1
Dispute Avoidance and
Mediation..................................44
19.2
Arbitration......................................................44
19.3
Duty
to Continue Performance.....................................45
19.4
Consequential
Damages............................................45
Article 20 Confidentiality of Shared
Information.............................45
20.1
Non-Disclosure
Obligation........................................45
20.2
Publicity and
Advertising........................................46
20.3
Term
of Obligation...............................................46
Article 21
Miscellaneous.....................................................46
21.1
Assignment.......................................................46
21.2
Successors.......................................................46
21.3
Governing
Law....................................................47
21.4
Severability.....................................................47
iii
Green Plains Renewable Energy, Inc.
January 13, 2006
<PAGE>
Table of Contents
(continued)
Page
21.5
No
Waiver........................................................47
21.6
Headings.........................................................47
21.7
Notice
........................................................47
21.8
No
Privity with Design
Consultant/Subcontractors.................48
21.9
Amendments.......................................................48
21.10
Entire
Agreement.................................................48
21.11
Third-Party
Beneficiaries........................................48
21.12
Counterparts.....................................................48
21.13
Survival.........................................................48
SCHEDULE
4.2.1...............................................................50
EXHIBIT A
...................................................................A-1
EXHIBIT
B....................................................................B-1
EXHIBIT
C....................................................................C-1
EXHIBIT
D....................................................................D-1
EXHIBIT
E....................................................................E-1
EXHIBIT
F....................................................................F-1
EXHIBIT
G....................................................................G-1
EXHIBIT
H....................................................................H-1
EXHIBIT
I....................................................................I-1
EXHIBIT
J....................................................................J-1
EXHIBIT
K....................................................................K-1
EXHIBIT
L....................................................................L-1
EXHIBIT
M....................................................................M-1
EXHIBIT
N....................................................................N-1
iv
Green Plains Renewable Energy, Inc.
January 13, 2006
<PAGE>
LUMP SUM DESIGN-BUILD CONTRACT
This LUMP SUM DESIGN-BUILD CONTRACT (the "Agreement") is made as
of
January 13, 2005, (the "Effective Date") by and between Green
Plains Renewable
Energy, Inc. an Iowa limited liability company (the "Owner") and
Fagen, Inc., a
Minnesota corporation (the "Design-Builder").
RECITALS
A. The Owner desires to develop, construct, own and operate a
50
million gallons per year ("MGY") dry grind ethanol production
facility located
at Shenandoah, Iowa (the "Plant"); and
B. Design-Builder desires to provide design, engineering,
procurement
and construction services for the Plant.
NOW, THEREFORE, in consideration of the mutual covenants and
obligations contained herein and for other good and valuable
consideration,
Owner and Design-Builder agree as follows.
AGREEMENT
Article 1
Definitions; Rules of Interpretation
1.1 Rules of Construction. The capitalized terms listed in this
Article
shall have the meanings set forth herein whenever the terms appear
in this
Agreement, whether in the singular or the plural or in the present
or past
tense. Other terms used in this Agreement but not listed in this
Article shall
have meanings as commonly used in the English language and, where
applicable, in
generally accepted construction and design-build standards of the
fuel ethanol
industry in the Midwest United States. Words not otherwise defined
herein that
have well known and generally accepted technical or trade meanings
are used
herein in accordance with such recognized meanings. In addition,
the following
rules of interpretation shall apply:
(a) The
masculine shall include the feminine and neuter.
(b) References
to "Articles," "Sections," "Schedules," or
"Exhibits" shall be to Articles, Sections, Schedules or
Exhibits of this Agreement.
(c) This
Agreement was negotiated and prepared by each of the
Parties with the advice and participation of counsel. The
Parties have agreed to the wording of this Agreement and none
of the provisions hereof shall be construed against one Party
on the ground that such Party is the author of this Agreement
or any part hereof.
Green Plains Renewable Energy, Inc.
January 13, 2006
1
<PAGE>
1.2 Defined Terms. In addition to definitions appearing elsewhere
in
this Agreement, the following terms have the following
meanings:
AAA is defined in Section 19.1.
Agreement is defined in the Preamble.
Air Emissions Tester means a third party entity engaged by Owner
meeting all
required state and federal requirements for such testing entities,
to conduct
air emissions testing of the Plant in accordance with Exhibit
A.
Applicable Law means
(a) any and
all laws, legislation, statutes, codes, acts, rules,
regulations, ordinances, treaties or other similar legal
requirements enacted, issued or promulgated by a Governmental
Authority;
(b) any and
all orders, judgments, writs, decrees, injunctions,
Governmental Approvals or other decisions of a Governmental
Authority; and
(c) any and
all legally binding announcements, directives or
published practices or interpretations, regarding any of the
foregoing in (a) or (b) of this definition, enacted, issued or
promulgated by a Governmental Authority;
to the extent, for each of the foregoing in (a), (b) and (c) of
this definition,
applicable to or binding upon (i) a Party, its affiliates, its
shareholders, its
members, it partners or their respective representatives, to the
extent any such
person is engaged in activities related to the Project; or (ii) the
property of
a Party, its affiliates, its shareholders, its members, its
partners or their
respective representatives, to the extent such property is used in
connection
with the Project or an activity related to the Project.
Application for Payment is defined in Section 10.2.1.
As Built Plans is defined in Section 5.2.
Bankrupt Party is defined in Section 15.6.1.
Baseline Index is defined in Section 12.4.1.
CCI is defined in Section 12.4.1.
Certificate of Substantial Completion is defined in Section
6.5.3
Change Order is defined in Section 13.1.1.
Construction Documents is defined in Section 3.2.2.
Contract Documents is defined in Section 2.2.
Contract Price is defined in Section 9.1.
Damages is defined in Section 14.3.1.
Green Plains Renewable Energy, Inc.
January 13, 2006
2
<PAGE>
Day or Days shall mean calendar days unless otherwise specifically
noted in the
Contract Documents.
Design-Builder is defined in the Preamble.
Design-Builder's Representative is defined in Section 16.2.
Design-Builder's Senior Representative is defined in Section
16.2.
Design Consultant is a qualified, licensed design professional that
is not an
employee of Design-Builder, but is retained by Design-Builder, or
employed or
retained by anyone under contract with Design-Builder or
Subcontractor, to
furnish design services required under the Contract Documents.
Differing Site Conditions is defined in Section 11.2.1.
Early Completion Bonus is defined in Section 6.5.4.
Effective Date is defined in the Preamble.
Final Application for Payment is defined in Section 10.3.
Final Completion is defined in Section 6.6.2.
Final Completion Date is the date that is 90 Days after the
Substantial
Completion Date.
Final Payment is defined in Section 10.3.
Financial Closing means the execution of the Financing Documents by
all the
parties thereto, and the fulfillment of all conditions precedent
thereunder
necessary to permit the advance of funds to pay amounts due under
this
Agreement.
Financing Documents means the final loan documents with the lender
or lenders
providing financing for the construction or term financing of the
Plant.
Force Majeure Event is defined in Section 12.1.
Governmental Approvals are any material authorizations or
permissions issued or
granted by any Governmental Authority to the Project, its Owner,
the
Design-Builder, Subcontractors and their affiliates in connection
with any
activity related to the Project.
Governmental Authority means any federal, state, local or municipal
governmental
body; any governmental, quasi-governmental, regulatory or
administrative agency,
commission, body or other authority exercising or entitled to
exercise any
administrative, executive, judicial, legislative, policy,
regulatory or taxing
authority or power; or any court or governmental tribunal; in each
case having
jurisdiction over the Owner, the Design-Builder, the Project, or
the Site.
Green Plains Renewable Energy, Inc.
January 13, 2006
3
<PAGE>
Hazardous Conditions are any materials, wastes, substances and
chemicals deemed
to be hazardous under applicable Legal Requirements, or the
handling, storage,
remediation, or disposal of which are regulated by applicable
Legal
Requirements.
ICM is defined in Section 5.2.1.
ICM License Agreement means the license agreement to be executed
between Owner
and ICM, Inc., substantially in the form attached hereto as Exhibit
D.
Indemnified Parties is defined in Section 5.2.
Independent Engineer means Owner's and Lenders' independent
engineer.
Industry-Wide Disruption is defined in Section 12.4.
Legal Requirements or Laws are all applicable federal, state and
local statutes,
laws, codes, ordinances, rules, regulations, judicial decisions,
orders, decrees
plans, injunctions, permits, tariffs, governmental agreements and
governmental
restrictions, whether now or hereafter in effect, of any government
or
quasi-government entity having jurisdiction over the Project or
Site, the
practices involved in the Project or Site, or any Work, including
any consensus
standards for materials, products, systems, and services
established by ASTM
International, any successor organization thereto, or any
Governmental
Authority.
Lenders means the lenders that are party to the Financing
Documents.
Lenders' Agent means an agent or agents acting on behalf of the
Lenders.
Manufacturer's Warranty shall mean a warranty provided by the
original
manufacturer or vendor of equipment used by Design-Builder in the
Plant.
MGY is defined in the Recitals.
Notice to Proceed is defined in Section 6.3.
Oversight Items is defined in Section 4.3.
Owner is defined in the Preamble.
Owner Indemnified Parties is defined in Section 14.3.1.
Owner's Representative is defined in Section 16.1.
Owner's Senior Representative is defined in Section 16.1.
Pass Through Warranties mean any warranties provided to
Design-Builder by a
Subcontractor which are assigned to Owner.
Pay Period means, with respect to a given Application for Payment
or Progress
Report, the one month period following the last day of the previous
Pay Period
Green Plains Renewable Energy, Inc.
January 13, 2006
4
<PAGE>
to which the immediately prior Application for Payment or Progress
Report is
applied; provided that the initial Pay Period shall commence on the
date of
delivery of the Notice to Proceed and end on the 24th day of the
calendar month
during which the Notice to Proceed is issued.
Payment Bond is defined in Section 7.4.2.
Performance Bond is defined in Section 7.4.1.
Performance Guarantee Criteria means the criteria listed in Exhibit
A.
Performance Tests is defined in Section 7.2.1.
Phase I is defined in Exhibit C.
Phase II is defined in Exhibit C.
Plant is defined in the Recitals.
Preliminary Construction Documents is defined in Section 3.2.1.
Progress Report is defined in Section 3.8.
Project is defined in Section 2.1.
Project Scope is defined in Exhibit B.
Punch List is defined in Section 6.5.3.
Qualified Independent Expert means an expert retained by Owner and
approved by
Design-Builder pursuant to Section 11.1.2.
Safety Representative is defined in Section 3.7.1.
Schedule of Values is defined in Section 10.2.5.
Scheduled Substantial Completion Date is defined in Section
6.5.1.
Site is the land or premises on which the Project is located.
Subcontractor is any person or entity retained by Design-Builder,
or by any
person or entity retained directly or indirectly by Design-Builder,
in each case
as an independent contractor to perform a portion of the Work and
shall include
materialmen and suppliers.
Substantial Completion is defined in Section 6.5.2.
Work is defined in Section 3.1.
Work Product is defined in Section 5.1.
Work Schedule is defined in Section 6.1.
Green Plains Renewable Energy, Inc.
January 13, 2006
5
<PAGE>
Article 2
The Project
2.1 Services to be Performed. Pursuant to this Agreement,
Design-Builder shall perform all work and services in connection
with the
engineering, design, procurement, construction startup, Perfomance
Tests,
training for the operation and maintenance of the Plant, and
provide all
material, equipment, tools and labor necessary to complete the
Plant in
accordance with the terms of this Agreement. The Plant, together
with all
equipment, labor, services and materials furnished hereunder is
defined as the
"Project."
2.2 Extent of Agreement. This Agreement consists of the
following
documents, and all exhibits, schedules, appendices and attachments
hereto and
thereto (collectively, the "Contract Documents"):
2.2.1 All written modifications, amendments and change orders
to this Agreement.
2.2.2 This Agreement, including all exhibits and attachments,
executed by Owner and Design-Builder, including those below:
List of Exhibits
Exhibit A
Performance Guarantee Criteria
Exhibit B
General Project Scope
Exhibit C
Owner's Responsibilities
Exhibit D
ICM License Agreement
Exhibit E
Schedule of Values
Exhibit F
Progress Report
Exhibit G
Permits Required
Exhibit H
Form of Performance Bond
Exhibit I
Form of Payment Bond
Exhibit J
Work Schedule
Exhibit K
Preliminary Construction Documents
Exhibit L
Draw
(Payment) Schedule
Exhibit M
Air Emissions Application or Permit
Exhibit N
Phase I and Phase II Engineering Services
Agreement
2.2.3 Preliminary Construction Documents prepared by
Design-Builder pursuant to Section 3.2.1 and the Construction
Documents to be
prepared by Design-Builder pursuant to Section 3.2.2 shall be
incorporated in
this Agreement.
Green Plains Renewable Energy, Inc.
January 13, 2006
6
<PAGE>
2.3 Conflicting Provisions. In the event of any conflict or
inconsistency between the body of this Agreement and any Exhibit or
Schedule
hereto, the terms and provisions of this Agreement, as amended from
time to
time, shall prevail and be given priority. Subject to the
foregoing, the several
documents and instruments forming part of this Agreement are to be
taken as
mutually explanatory of one another and in the case of ambiguities
or
discrepancies within or between such parts the same shall be
explained and
interpreted, if possible, in a manner which gives effect to each
part and which
avoids or minimizes conflicts among such parts. No oral
representations or other
agreements have been made by the parties except as specifically
stated in the
Contract Documents.
Article 3
Design-Builder Responsibilities
3.1 Design-Builder's Services in General. Except for services
and
information to be provided by Owner and specifically set forth in
Article 4 and
Exhibit C, Design-Builder shall perform or cause to be performed
all design,
engineering, procurement, construction services, supervision,
labor, inspection,
testing, start-up, material, equipment, machinery, temporary
utilities and other
temporary facilities to complete construction of the Project
consistent with the
Contract Documents (the "Work"). All design and engineering and
construction
services and other Work of the Design-Builder shall be performed in
accordance
with (i) the Project Scope as set forth in Exhibit B, (ii) the
Construction
Documents, (iii) all Legal Requirements, and (iv) generally
accepted
construction and design-build standards of the fuel ethanol
industry in the
Midwest United States. Any design and engineering or other
professional service
to be performed pursuant to this Agreement, which under Applicable
Law must be
performed by licensed personnel, shall be performed by licensed
personnel as
required by Law. The enumeration of specific duties and obligations
to be
performed by the Design-Builder under the Contract Documents shall
not be
construed to limit in any way the general undertakings of the
Design-Builder as
set forth herein. Design-Builder's Representative shall be
reasonably available
to Owner and shall have the necessary expertise and experience
required to
supervise the Work. Design-Builder's Representative shall
communicate regularly
with Owner and shall be vested with the authority to act on behalf
of
Design-Builder.
3.2 Design Development and Services.
3.2.1 As of the Effective Date, but in no event later than
thirty (30) Days from the Effective Date, Design-Builder has or
shall have
provided to Owner the following documents, and any other documents
reasonably
agreed to by Design-Builder and Owner as applying to the conceptual
design of
the Project and required to apply for the construction air permit
or completion
of the Site layout in cooperation with Owner's rail engineer
(collectively, the
"Preliminary Construction Documents"), which shall be consistent
with the
Project Scope and once approved by Owner, shall be part of this
Agreement:
a) major equipment lists, with sizes;
b) process flow diagram;
Green Plains Renewable Energy, Inc.
January 13, 2006
7
<PAGE>
c) process design criteria and/or process description; and
d) Site layout.
Owner shall have thirty (30) Days from the date it receives the
Preliminary
Construction Documents to review and approve such documents. The
Preliminary
Construction Documents shall establish performance standards for
the completed
Project and identify components required to meet those performance
standards.
Any changes to the Preliminary Construction Documents shall be
subject to the
prior review and approval by Owner, such approval not to be
unreasonably
withheld or delayed.
3.2.2 Where required by Law, Design-Builder shall provide
through qualified,licensed design professionals employed by
Design-Builder, or
procured from qualified, independent licensed Design Consultants,
the necessary
design services, including architectural, engineering and other
design
professional services, for the preparation of the required
drawings,
specifications and other design submittals required to permit
construction of
the Work in accordance with this Agreement and the Preliminary
Construction
Documents (such drawings, specifications and design submittals
collectively and
together with the Preliminary Construction Documents, the
"Construction
Documents"). To the extent not prohibited by Legal Requirements,
Design-Builder
may prepare Construction Documents for a portion of the Work to
permit
construction to proceed on that portion of the Work prior to
completion of the
Construction Documents for the entire Work.
3.2.3 Construction of the Plant shall be consistent with the
Construction Documents.
3.2.4 Design-Builder shall maintain a current, complete set of
drawings and specifications at the Site. Owner shall the right to
review such
drawings and specifications. Owner and Independent Engineer may not
make copies
of the available drawings and specifications without
Design-Builder's written
permission, and, granted such permission, may only do so to the
extent such
drawings and specifications directly pertain to the Plant; provided
however
that, pursuant to Section 5.1 of this Agreement, Design-Builder
retains
ownership of and property interests in any drawing or
specifications made
available and/or copied.
Except as provided elsewhere in this Agreement, it is understood
and agreed that
review, comment and/or approval by Owner (or its designees) or
Independent
Engineer of any documents or submittals that Design-Builder is
required to
submit to Owner (or its designees) or Independent Engineer
hereunder for their
review, comment and/or approval (including without limitation the
Preliminary
Construction Documents pursuant to Section 3.2.1 hereof or other
Construction
Documents pursuant to Sections 3.2.2 and 3.2.4 hereof) shall not
relieve or
release Design-Builder from any of its duties, obligations or
liabilities
provided for under the terms of this Agreement or transfer any
design liability
from Design-Builder to Owner.
3.3 Standard of Care. All services performed by the Design-Builder
and
its Subcontractors pursuant to the Construction Documents shall be
performed in
accordance with the standard of care and skill generally accepted
in the fuel
ethanol industry in the Midwest United States during the relevant
time period or
Green Plains Renewable Energy, Inc.
January 13, 2006
8
<PAGE>
in accordance with any of the practices, methods and acts that in
the exercise
of reasonable judgment in light of the facts known at the time the
decision was
made, could have been expected to accomplish the desired result at
a reasonable
cost consistent with good business practices, safety and
expedition. This
standard of care is not intended to be limited to the optimum
practice, method
or act to the exclusion of all others, but rather to be acceptable
practices,
methods or acts generally accepted in the construction and
design-build
standards of the fuel ethanol industry in the Midwest United
States.
Design-Builder and its Subcontractors shall perform all
construction activities
efficiently and with the requisite expertise, skill, competence,
resources and
care to satisfy the requirements of the Contract Documents and all
applicable
Legal Requirements. Design-Builder shall at all times exercise
complete and
exclusive control over the means, methods, sequences and techniques
of
construction.
3.4 Government Approvals and Permits. Except as identified in
Exhibit C
and, with respect to items identified as Owner's responsibility, in
Exhibit G
(which items shall be obtained by Owner pursuant to Section 4.5),
Design-Builder
shall obtain and pay for all necessary permits, approvals,
licenses, government
charges and inspection fees required for the prosecution of the
Work by any
government or quasi-government entity having jurisdiction over the
Project.
Design-Builder shall provide reasonable assistance to Owner in
obtaining those
permits, approvals and licenses that are Owner's
responsibility.
3.5 Subcontractors.
3.5.1 Design-Builder may subcontract portions of the Work in
accordance with the terms hereof.
3.5.2 Design-Builder assumes responsibility to Owner for the
proper performance of the Work of Subcontractors and any acts and
omissions in
connection with such performance and any costs or delay associated
with such
acts or omissions. Nothing in the Contract Documents is intended or
deemed to
create any legal or contractual relationship between Owner and
any
Subcontractor, including but not limited to any third-party
beneficiary rights.
3.5.3 Design-Builder shall coordinate the activities of all of
Design-Builder's Subcontractors. If Owner performs other work on
the Project or
at the Site with separate contractors under Owner's control,
Design-Builder
agrees to reasonably cooperate and coordinate its activities with
those separate
contractors so that the Project can be completed in an orderly and
coordinated
manner without unreasonable disruption.
3.5.4 Design-Builder shall ensure that each subcontract with a
Subcontractor is assignable to Owner without consent of the
Subcontractor or any
other person or entity in the event that Design-Builder shall be in
an uncured
default or terminated with cause under the terms of this
Agreement.
3.6 Maintenance of Site. Design-Builder shall keep the Site
reasonably
free from debris, trash and construction wastes to permit
Design-Builder to
perform its construction services efficiently, safely and without
interfering
with the use of adjacent land areas. Upon Substantial Completion of
the Work, or
Green Plains Renewable Energy, Inc.
January 13, 2006
9
<PAGE>
portion of the Work, as applicable, Design-Builder shall remove all
debris,
trash, construction wastes, materials, equipment, machinery and
tools arising
from the Work or applicable portions thereof to permit Owner to
occupy the
Project for its intended use.
3.7 Project Safety.
3.7.1 Design-Builder recognizes the importance of performing
the Work in a safe manner so as to prevent damage, injury or loss
to (i) any
individuals at the Site, whether working or visiting, (ii) the
Work, including
materials and equipment incorporated into the Work or stored
on-Site or
off-Site, and (iii) any other property at the Site or adjacent
thereto.
Design-Builder assumes responsibility for implementing and
monitoring all safety
precautions and programs related to the performance of the Work.
Design-Builder
shall, prior to commencing construction, designate a representative
(the "Safety
Representative") with the necessary qualifications and experience
to supervise
the implementation and monitoring of all safety precautions and
programs related
to the Work. Unless otherwise required by the Contract
Documents,
Design-Builder's Safety Representative shall be an individual
stationed at the
Site who may have responsibilities on the Project in addition to
safety. The
Safety Representative shall make routine daily inspections of the
Site and shall
hold weekly safety meetings with Design-Builder's personnel,
Subcontractors and
others as applicable.
3.7.2 Design-Builder and Subcontractors shall comply with all
Legal Requirements relating to safety, as well as any
Owner-specific safety
requirements set forth in the Contract Documents; provided, that
such
Owner-specific requirements do not violate any applicable Legal
Requirement. As
promptly as practicable, Design-Builder will report in writing
any
safety-related injury, loss, damage or accident arising from the
Work to Owner's
Representative and, to the extent mandated by Legal Requirements,
to all
government or quasi-government authorities having jurisdiction
over
safety-related matters involving the Project or the Work.
3.7.3 Design-Builder's responsibility for safety under this
Section 3.7 is not intended in any way to relieve Subcontractors of
their own
contractual and legal obligations and responsibility for (i)
complying with all
Legal Requirements, including those related to health and safety
matters, and
(ii) taking all necessary measures to implement and monitor all
safety
precautions and programs to guard against injury, losses, damages
or accidents
resulting from their performance of the Work.
3.8 Submission of Reports. Design-Builder shall provide Owner
with
regular communication regarding the progress ("Progress Report")
and any
revisions to the drawings and specifications of the Work, including
whether (i)
the Work is proceeding according to schedule, (ii) discrepancies,
conflicts, or
ambiguities exist in the Contract Documents that require
resolution, (iii)
health and safety issues exist in connection with the Work, and
(iv) other items
require resolution so as not to jeopardize Design-Builder's ability
to complete
the Work for the Contract Price and within the contract time(s).
Progress
Reports shall be in the form of Exhibit F attached hereto and shall
be included
with each Application for Payment.
3.9 Training. At a mutually agreed time prior to start-up,
Design-Builder shall provide two (2) weeks of training at a plant
in Russell,
Kansas (or other location) for all of Owner's employees required
for the
Green Plains Renewable Energy, Inc.
January 13, 2006
10
<PAGE>
operation and maintenance of the Plant in accordance with all
design
specifications therefor contained in the Contract Documents and
necessary in
order to maintain the Performance Guarantee Criteria, including
operators,
laboratory personnel, general, plant and maintenance managers.
Other personnel
of Owner may receive such off-site training by separate arrangement
between
Owner and Design-Builder and as time is available. All training
personnel and
costs associated with such training personnel, including labor and
all training
materials will be provided to Owner within the Contract Price at no
additional
cost. Owner will be responsible for all travel and expenses of
their employees
and the Owner will pay all wages and all other expenses for their
personnel
during the training. The training services will include training on
computers,
laboratory procedures, field operating procedures, and overall
plant section
performance expectations. Prior to the start-up training,
Design-Builder shall
provide Owner training manuals and operating manuals and other
documents
reasonably necessary for the start-up process.
Article 4
Owner's Responsibilities
4.1 Duty to Cooperate.
4.1.1 Owner shall, throughout the performance of the Work,
cooperate with Design-Builder and perform its responsibilities,
obligations and
services in a timely manner to facilitate Design-Builder's timely
and efficient
performance of the Work and so as not to delay or interfere
with
Design-Builder's performance of its obligations under the Contract
Documents.
4.1.2 Owner shall provide timely review and approval of
Preliminary Construction Documents subject to Section 3.2.1.
4.1.3 Owner shall pay all the reasonable costs incurred by
Design-Builder for frost removal so that winter construction can
proceed. Such
costs may include but are not limited to, equipment costs,
equipment rental
costs, sheltering costs, special material costs, fuel costs and
associated labor
costs. Owner acknowledges and agrees that such costs are in
addition to, and not
included in, the Contract Price.
4.2 Furnishing of Services and Information.
4.2.1 Except as set forth in Schedule 4.2.1, as of the
Effective Date, Owner has provided to Design-Builder, at its own
cost and
expense, for Design-Builder's information and use, the following,
all of which
Design-Builder is entitled to rely upon in performing the Work:
(a) surveys
describing the property, boundaries,
topography and reference points for use during
construction, including existing service and utility
lines;
Green Plains Renewable Energy, Inc.
January 13, 2006
11
<PAGE>
(b)
geotechnical studies describing subsurface conditions
including soil borings, and other surveys describing
other latent or concealed physical conditions at the
Site;
(c) temporary
and permanent easements, zoning and other
requirements and encumbrances affecting land use, or
necessary to permit the proper design and
construction of the Project and enable Design-Builder
to perform the Work;
(d) A legal
description of the Site;
(e) to the
extent available, as-built and record drawings
of any existing structures at the Site;
(f)
environmental studies, reports and impact statements
describing the environmental conditions, including
Hazardous Conditions, in existence at the Site;
(g) Owner's
deliverables under Exhibit C; and
(h) the
permits listed on Exhibit G that are described as
"obtained".
Except for those items listed in Exhibit J ("Owner Milestones")
Owner shall
provide Design-Builder all items listed on Schedule 4.2.1 no later
than 60 Days
prior to the issuance of the Notice to Proceed.
4.2.2 Owner is responsible for securing and executing all
necessary agreements with adjacent land or property owners that are
necessary to
enable Design-Builder to perform the Work and that have been
identified and
notified in writing by Design-Builder to Owner prior to the
Effective Date.
Owner is further responsible for all costs, including attorneys'
fees, incurred
in securing these necessary agreements.
4.3 Financial Information; Cooperation with Lenders; Failure to
Obtain
Financial Closing. Design-Builder acknowledges that Owner is
seeking financing
for the Project. Design-Builder agrees to cooperate with Owner in
good faith in
order to satisfy the requirements of Owners' financing
arrangements, including,
where appropriate, the execution and delivery of documents or
instruments
necessary to accommodate the Financial Closing. Owner agrees to pay
all
documented costs incurred by Design-Builder incurred prior to and
at Financial
Closing, and thereafter during the term of this Agreement, in
connection with
satisfying the requirements of Owners' financing arrangements
including all
documented attorney's fees, and Design-Builder shall provide
written Notice to
Owner prior to incurring such costs. Design-Builder and Owner also
acknowledge
that the Lenders, as a condition to providing financing for the
Plant, shall
require Owner to provide the Independent Engineer with certain
participation and
review rights with respect to Design-Builder's performance of the
Work.
Design-Builder acknowledges and agrees that such participation and
review rights
shall consist of the right to (i) enter the Site and inspect the
Work upon
Green Plains Renewable Energy, Inc.
January 13, 2006
12
<PAGE>
reasonable notice to Design-Builder; (ii) attend all start-up and
testing
procedures; and (iii) review and approve such other items for which
Owner is
required by Lenders to obtain the concurrence, opinion or a
certificate of the
Independent Engineer or the Lenders pursuant to the Financing
Documents which
items do not alter the rights or impose additional obligations on
Design-Builder
(collectively, the "Oversight Items"). Nothing in this Section 4.3
shall be
deemed to require Design-Builder to agree to any amendments to this
Agreement
that would adversely affect Design-Builder's risks, rights or
obligations under
this Agreement. Upon Financial Closing, Owner shall promptly
provide to
Design-Builder an officer's certificate certifying that Financial
Closing has
occurred and such Owner's officer's certificate shall constitute
evidence
satisfactory to Design-Builder that Owner has adequate funds
available and
committed to fulfill its obligations under the Contract Documents
for all
purposes hereunder. Owner must obtain Financial Closing prior to
issuing the
Notice to Proceed.
4.4 Owner's Representative. Owner's Representative, as set forth
in
Section 16.1 hereof, shall be responsible for providing
Owner-supplied
information and approvals in a timely manner to permit
Design-Builder to fulfill
its obligations under the Contract Documents. Owner's
Representative shall also
provide Design-Builder with prompt notice if it observes any
failure on the part
of Design-Builder to fulfill its contractual obligations, including
any errors,
omissions or defects in the performance of the Work. Owner's
Representative
shall be vested with the authority to act on behalf of Owner and
Design-Builder
shall be entitled to rely on written communication from Owner's
Representative
with respect to a Project matter.
4.5 Government Approvals and Permits. Owner shall obtain and pay
for
all necessary Governmental Approvals required by Law, including
permits,
approvals, licenses, government charges and inspection fees set
forth in Exhibit
C and, to the extent identified as Owner's responsibility, Exhibit
G. Owner
shall provide reasonable assistance to Design-Builder in obtaining
those
permits, approvals and licenses that are Design-Builder's
responsibility
pursuant to Exhibits G and Section 3.4.
4.6 Owner's Separate Contractors. Owner is responsible for all
work,
including such work listed on Exhibit C, performed on the Project
or at the Site
by separate contractors under Owner's control. Owner shall
contractually require
its separate contractors to cooperate with, and coordinate their
activities so
as not to interfere with, Design-Builder in order to enable
Design-Builder to
timely complete the Work consistent with the Contract
Documents.
4.7 Security.
4.7.1 Owner shall be responsible for Site security (including
fencing, alarm systems, security guarding services and the like) at
all times
during the term of this Agreement to prevent vandalism, theft and
danger to the
Project, the Site, and personnel. Owner shall coordinate and
supervise ingress
and egress from the Site so as to minimize disruption to the
Work.
4.7.2 Design-Builder shall at all times conduct its operations
in a manner to minimize the risk of loss, theft, or damage by
vandalism,
sabotage, or any other means. Design-Builder shall continuously
inspect all
Green Plains Renewable Energy, Inc.
January 13, 2006
13
<PAGE>
Work, materials, and equipment to discover and determine any
conditions that
might involve such risks and shall be solely responsible for
discovery,
determination, and correction of any such conditions.
Article 5
Ownership of Work Product; Risk of Loss
5.1 Work Product. All drawings, specifications, calculations,
data,
notes and other materials and documents, including electronic data
furnished by
Design-Builder to Owner under this Agreement ("Work Product") shall
be
instruments of service and Design-Builder shall retain the
ownership and
property interests therein, including the copyrights thereto.
5.2 Owner's Limited License Upon Payment in Full. Upon Owner's
payment
in full for all Work performed under the Contract Documents,
Design-Builder
shall grant Owner a limited license to use the Work Product in
connection with
Owner's occupancy and repair of the Plant. Design-Builder
acknowledges and
agrees that the limited license to use the Work Product granted
hereby shall
provide Owner sufficient rights in and to the Work Product as shall
be necessary
for Owner to operate and maintain the Plant and shall include any
Pass Through
Warranties in connection therewith. Design-Builder shall provide
Owner with a
copy of the plans of the Plant, as built, (the "As Built Plans")
conditioned on
Owner's express understanding that its use of the Work Product and
its
acceptance of the As Built Plans is at Owner's sole risk and
without liability
or legal exposure to Design-Builder or anyone working by or
through
Design-Builder, including Design Consultants of any tier
(collectively the
"Indemnified Parties"); provided, however, that any performance
guarantees, and
warranties (of equipment or otherwise) shall remain in effect
according to the
terms of this Agreement.
5.2.1 Owner shall be entitled to use the Work Product solely
for purposes relating to the Plant, but shall not be entitled to
use the Work
Product for any other purposes whatsoever, including without
limitation,
expansion of the Plant. Notwithstanding the foregoing sentence,
Owner shall be
entitled to use the Work Product for the operation, maintenance and
repair of
the plant including the interconnection of, but not the design of,
any future
expansions to the Plant. The limited license granted to Owner under
Sections
5.2, 5.3 or 5.4 to use the Work Product shall be limited by and
construed
according to the same terms contained in the ICM License Agreement
between Owner
and ICM, Inc., attached hereto as Exhibit D and incorporated herein
by reference
thereto, except (i) references in such ICM License Agreement to ICM
and
Proprietary Property shall refer to Design-Builder and Work
Product,
respectively, (ii) the Laws of the State of Minnesota shall govern
such limited
license, and (iii) the dispute resolution provisions contained in
Article 19
hereof shall apply to any breach or threatened breach of Owner's
duties or
obligations under such limited license, except that Design-Builder
shall have
the right to seek injunctive relief in a court of competent
jurisdiction against
Owner or its Representatives for any such breach or threatened
breach.
Design-Builder is utilizing certain proprietary property and
information of ICM,
Inc., a Kansas corporation ("ICM"), in the design and construction
of the
Project, and Design-Builder may incorporate proprietary property
and information
of ICM into the Work Product. Owner's use of the proprietary
property and
Green Plains Renewable Energy, Inc.
January 13, 2006
14
<PAGE>
information of ICM shall be governed by the terms and provisions of
the License
Agreement between Owner and ICM, attached hereto as Exhibit D, to
be executed by
such parties in connection with the execution of this Agreement.
This paragraph
also applies to Articles 5.3 and 5.4 below.
5.3 Owner's Limited License Upon Owner's Termination for
Convenience or
Design-Builder's Election to Terminate. If Owner terminates the
Project for its
convenience as set forth in Section 15.3 hereof, or if
Design-Builder elects to
terminate this Agreement in accordance with Section 15.5,
Design-Builder shall,
upon Owner's payment in full of the amounts due Design-Builder
under this
Agreement, grant Owner a limited license to use the Work Product to
complete the
Plant and subsequently occupy and repair the Plant, subject to the
following:
(i) Use of the
Work Product is at Owner's sole risk without
liability or legal exposure to any Indemnified Party;
provided, however, that any Pass Through Warranties regarding
equipment or express warranties regarding equipment provided
by this Agreement shall remain in effect according to their
terms; and
(ii)
If the termination for convenience is by Owner in accordance
with Section 15.3 hereof, or if Design-Builder elects to
terminate this Agreement in accordance with Section 15.5, then
Owner agrees to pay Design-Builder the additional sum of One
Million Two Hundred Fifty Thousand Dollars ($1,250,000.00) as
compensation for the limited right to use the Work Product
completed "as is" on the date of termination in accordance
with this Article 5.
5.4 Owner's Limited License Upon Design-Builder's Default. If
this
Agreement is terminated due to Design-Builder's default pursuant to
Section 15.2
and (i) it is adjudged that Design-Builder was in default, and (ii)
Owner has
fully satisfied all of its obligations under the Contract Documents
through the
time of Design-Builder's default, then Design-Builder shall grant
Owner a
limited license to use the Work Product in connection with Owner's
completion
and occupancy, operation and repair of the Plant. This limited
license is
conditioned on Owner's express agreement that its use of the Work
Product is at
Owner's sole risk without liability or legal exposure to any
Indemnified Party;
provided, however, that any Pass Through Warranties regarding
equipment or
express warranties regarding equipment provided by this Agreement
shall remain
in effect according to their terms. This limited license grants
Owner the
ability to repair the Plant at Owner's discretion.
5.5 Owner's Indemnification for Use of Work Product. If Owner uses
the
Work Product or Plant under any of the circumstances identified in
this Article
5, to the fullest extent allowed by Law, Owner shall defend,
indemnify and hold
harmless the Indemnified Parties from and against any and all
claims, damages,
liabilities, losses and expenses, including attorneys' fees,
arising out of or
resulting from the use of the Work Product and Plant; provided,
however, that
any Pass Through Warranties regarding equipment or express
warranties regarding
equipment provided by this Agreement shall remain in effect
according to their
terms.
5.6 Risk of Loss. Design-Builder shall have no liability for a
physical
loss of or damage to the Work unless such loss or damage is caused
by
Design-Builder or someone acting under its direction or control.
Design-Builder
shall not be liable for physical loss of or damage to the Work
where such loss
or damage is caused by the willful misconduct or gross negligence
of Owner's
employees or third parties who are not Subcontractors.
Design-Builder shall have
Green Plains Renewable Energy, Inc.
January 13, 2006
15
<PAGE>
no liability for losses or damages for which insurance coverage
under this
Agreement is available to Owner and for which proceeds have been
paid; in such
circumstances, Design Builder's liability for losses and damages as
described in
this Section 5.6 shall be limited to losses or damages which exceed
insurance
coverage available to the Owner and for which proceeds have been
paid, without
application of deductible, retention or retrospective premiums.
Article 6
Commencement and Completion of the Project
6.1 Work Schedule. The preliminary schedule for the execution of
the
Work is attached as Exhibit J hereto (the "Work Schedule"). The
final schedule
for execution of the Work shall be provided within thirty (30) Days
after
receipt of the Notice to Proceed. The Work Schedule provides the
scheduled dates
for the commencement and completion of the various stages of Work,
including the
dates when Owner's obligations are required to be complete to
enable
Design-Builder to achieve the contract time(s). The Work Schedule
shall be
revised as required by conditions and progress of the Work but such
revisions
shall not relieve Design-Builder of its obligations to complete the
Work within
the contract time(s), unless such revisions to the Work Schedule
are required as
a result of any delay in the completion of Owner's obligations or
as a result of
a Force Majeure Event. In such event, the Work Schedule shall be
revised to
provide, without penalty to Design-Builder, a Day-for-Day extension
of the
contract time(s) for completion of the Work for each Day during
which Owner's
failure to complete its obligations or a Force Majeure Event causes
such delay.
6.2 Phase I and Phase II Engineering. Owner and Design-Builder
have
entered into that certain Phase I and Phase II Engineering Services
Agreement
dated October 4, 2005, and attached hereto as Exhibit N. The Phase
I and Phase
II Engineering Services Agreement provides for Design-builder to
commence work
on the Phase I and Phase II engineering for the Project as set
forth therein.
Owner has agreed to pay Design-Builder ** Dollars ($**) for such
engineering
services pursuant to the terms of that agreement, the full amount
of which shall
be included in and credited to the Contract Price. Notwithstanding
the foregoing
sentence, if a Notice to Proceed is not issued pursuant to Section
6.3, or
Financial Closing is not obtained pursuant to Section 4.3, then
Design-Builder
shall keep the full amount paid under the Phase I and Phase II
Engineering
Services Agreement as compensation for the services provided
thereunder.
6.3 Notice to Proceed; Commencement. The Work shall commence
within
five (5) Days of Design-Builder's receipt of Owner's written valid
notice to
proceed ("Notice to Proceed") unless the parties mutually agree
otherwise in
writing. The parties agree that a valid Owner's Notice to Proceed
cannot be
given prior to March 1, 2006 unless prior to that date,
Design-Builder has
delivered a written notice to Owner informing Owner that
Design-Builder is ready
to accept a Notice to Proceed and to commence Work. The parties
further agree
that a valid Owner's Notice to Proceed cannot be given unless;
**.
---------------
The "**" marks the location of information that has been omitted
and filed
separately with the Securities and Exchange Commission pursuant to
a request for
confidential treatment.
Green Plains Renewable Energy, Inc.
January 13, 2006
16
<PAGE>
Owner and Design-Builder mutually agree that time is of the essence
with respect
to the dates and times set forth in the Contract Documents.
Design-Builder must
receive a valid Owner's Notice to Proceed no later than 180 days
from the
Effective Date; otherwise, unless the failure to deliver a Notice
to Proceed is
due solely to the actions of Design-Builder, the Contract Price
referred to in
Section 9.1 shall be subject to a price increase, or this Agreement
shall
terminate, either at Design-Builder's sole option. If
Design-Builder chooses to
terminate this Agreement pursuant to its right under the
immediately preceding
sentence, then Design-Builder shall have no further obligations
hereunder.
6.4 Project Start-Up and Testing. Owner shall provide, at Owner's
cost,
equipment, tools, instruments and materials necessary for Owner to
comply with
its obligations under Exhibit C, raw materials, consumables and
personnel,
necessary for start-up and testing of the Plant, and Design-Builder
shall
provide supervision, standard and special test instruments, tools,
equipment and
materials required to perform component and equipment checkout and
testing,
initial start-up, operations supervision and corrective maintenance
of all
permanent Plant equipment within the scope of the Work.
Notwithstanding the
foregoing sentence, Design-Builder shall be responsible for raw
materials and
consumables to the extent such amounts provided by Owner are
destroyed or
damaged (as opposed to consumed in the ordinary course of start-up
and testing)
by Design-Builder or its personnel during start-up and testing.
Design-Builder
shall supervise and direct Owner's personnel who shall participate
in the
start-up activities with Design-Builder's personnel to become
familiar with all
aspects of the Plant. Owner and the Independent Engineer may
witness start-up
and testing activities. Performance testing will be conducted in
accordance with
the provisions of Section 7.2 hereof.
6.5 Substantial Completion.
6.5.1 Substantial Completion of the entire Work shall be
achieved no later than Four Hundred and Eighty Five (485) Days
after the date of
the Notice to Proceed, subject to adjustment in accordance with the
Contract
Documents hereof (the "Scheduled Substantial Completion Date").
6.5.2 "Substantial Completion" shall be deemed to occur on the
date on which the Work is sufficiently complete so that Owner can
occupy and use
the Plant for its intended purposes. Substantial Completion shall
be attained at
the point in time when the Plant is ready to grind corn and begin
operation for
its intended use as a 50 MGY fuel ethanol production plant.
6.5.3 Procedures. Design-Builder shall notify Owner in writing
when it believes Substantial Completion has been achieved with
respect to the
Work. Within five (5) Days of Owner's receipt of Design-Builder's
notice, Owner
and Design-Builder will jointly inspect such Work to verify that it
is
substantially complete in accordance with the requirements of the
Contract
Documents. If such Work is deemed substantially complete,
Design-Builder shall
prepare and issue a "Certificate of Substantial Completion" for the
Work that
will set forth (i) the date of Substantial Completion, (ii) the
remaining items
of Work that have to be completed before Final Payment ("Punch
List"), (iii)
provisions (to the extent not already provided in this Agreement)
establishing
Owner's and Design-Builder's responsibility for the Project's
security,
Green Plains Renewable Energy, Inc.
January 13, 2006
17
<PAGE>
maintenance, utilities and insurance pending Final Payment, and
(iv) an
acknowledgment that warranties with respect to the Work commence on
the date of
Substantial Completion, except as may otherwise be noted in the
Certificate of
Substantial Completion. Upon Substantial Completion of the entire
Work and
satisfaction of the Performance Guarantee Criteria listed in
Exhibit A, Owner
shall release to Design-Builder all retained amounts relating, as
applicable, to
the entire Work or completed portion of the Work, less an amount
equal to the
reasonable value of all remaining or incomplete items of Work as
noted in the
Certificate of Substantial Completion, and less an amount equal to
the value of
any Subcontractor lien waivers not yet obtained.
(a) Owner, at
its option, may use a portion of the Work prior to
completion of
the entire Work; provided, that (i) a
Certificate of Substantial completion has been issued for the
portion of Work addressing the items set forth in Section
6.5.3 above, (ii) Design-Builder and Owner have, to the extent
required, obtained the consent of their sureties and insurers
and the appropriate government authorities having jurisdiction
over the Project, and (iii) Owner and Design-Builder agree
that Owner's use or occupancy will not interfere with
Design-Builder's completion of the remaining Work in
accordance with the Contract Documents.
6.5.4 Early Completion Bonus. If Substantial Completion is
attained within 485 Days after the date of the Notice to Proceed,
Owner shall
pay Design-Builder at the time of Final Payment under Section 10.3
hereof an
early completion bonus ("Early Completion Bonus") of ** Dollars
($**) per Day
for each Day that Substantial Completion occurred in advance of the
Scheduled
Substantial Completion Date. The Parties agree that no Early
Completion Bonus
shall be due to Design-Builder for any period during which the
Plant is
non-operational for more than twenty-four (24) consecutive
hours.
6.5.5 In all events, payment of said bonus, if applicable, at
the time of Final Payment is subject to release of funds by senior
lender. If
senior lender does not allow release of funds at the time of Final
Payment to
pay said early completion bonus in full, any unpaid balance shall
be converted
to an unsecured promissory note payable by Owner to Design-Builder,
accruing
interest at ten percent (10%). On each anniversary of the note, any
unpaid
accrued interest shall be converted to principal and shall accrue
interest as
principal thereafter. Owner shall pay said promissory note as soon
as allowed by
senior lender; in any event, the note, plus accrued interest, shall
be paid in
full before Owner pays or makes any distributions to or for the
benefit of its
owners (shareholders, members, partners, etc.). All payments shall
be applied
first to accrued interest and then to principal.
6.6 Final Completion.
6.6.1 Final Completion of the Work shall be achieved within
Ninety (90) Days after the date of Substantial Completion.
---------------
The "**" marks the location of information that has been omitted
and filed
separately with the Securities and Exchange Commission pursuant to
a request for
confidential treatment.
Green Plains Renewable Energy, Inc.
January 13, 2006
18
<PAGE>
6.6.2
6.6.3 "Final Completion" shall be achieved when the Owner
reasonably determines that the following conditions have been
met:
(a)
Substantial Completion has been achieved;
(b) any
outstanding amounts owed by Design-Builder to
Owner have been paid in full;
(c) the items
identified on the Punch List have been
completed by Design-Builder;
(d) clean-up
of the Site has been completed;
(e) all
permits required to have been obtained by
Design-Builder have been obtained;
(f) the
information in Section 6.6.4 has been provided to
Owner;
(g)
certificates of insurance confirming that required
coverages will remain in effect consistent with the
requirements of the Contract Documents have been
obtained;
(h) release
and waiver of all claims and liens from
Design-Builder and Subcontractors have been provided;
and
(i) the
Performance Tests have been successfully
completed.
6.6.4 After receipt of a Final Application for Payment from
Design-Builder, Owner shall make Final Payment in accordance with
Section 10.3,
less an amount equal to the value of any Subcontractor lien waivers
not yet
obtained.
6.6.5 At the time of submission of its Final Application for
Payment, Design-Builder shall provide the following
information:
(a) an
affidavit that there are no claims, obligations or
liens outstanding or unsatisfied for labor, services,
material, equipment, taxes or other items performed,
furnished or incurred for or in connection with the
Work which will in any way affect Owner's interests;
(b) a general
release executed by Design-Builder waiving,
upon receipt of final payment by Design-Builder, all
claims for payment, additional compensation, or
damages for delay, except those previously made to
Owner in writing and remaining unsettled at the time
of Final Payment provided such general release shall
not waive defenses to claims that may be asserted by
Owner after payment or claims arising after payment;
Green Plains Renewable Energy, Inc.
January 13, 2006
19
<PAGE>
(c) consent of
Design-Builder's surety, if any, to Final
Payment; and
(d) a hard
copy of the As Built Plans; provided, however,
that such plans will remain the Work Product of the
Design-Builder and subject in all respects to Article
5.
6.6.6 Upon making Final Payment, Owner waives all claims
against Design-Builder except claims relating to (i)
Design-Builder's failure to
satisfy its payment obligations, (ii) Design-Builder's failure to
complete the
Work consistent with the Contract Documents, including defects
appearing within
one year after Substantial Completion, and (iii) the terms of any
warranties
required by the Contract Documents.
6.7 Post Completion Support. Adequate personnel to complete all
Work
within the Work Schedule will be maintained on-Site by
Design-Builder or a
Subcontractor until Final Completion has been achieved. In addition
to
prosecuting the Work until Final Completion has been achieved,
Design-Builder or
its Subcontractor will provide one month of on-Site operational
support for
Owner's personnel after successful completion of the Performance
Tests and, from
the date of Substantial Completion, will provide six (6) months of
off-Site
technical and operating procedure support by telephone and other
electronic data
transmission and communication.
Article 7
Performance Testing and Liquidated Damages
7.1 Performance Guarantee. The Design-Builder guarantees that the
Plant
will meet the performance criteria listed in Exhibit A (the
"Performance
Guarantee Criteria") during a performance test conducted and
concluded pursuant
to the terms hereof not later than Ninety (90) Days after the date
of
Substantial Completion. If there is a performance shortfall,
Design-Builder will
pay all design and construction costs associated with making the
necessary
corrections. Design-Builder retains the right to use its sole
discretion in
determining the method (which shall be in accordance with generally
accepted
construction and design-build standards of the fuel ethanol
industry in the
Midwest United States) to remedy any performance related
issues.
7.1.1 If Owner, for whatever reason, prevents Design-Builder
from demonstrating the Performance Guarantee Criteria within thirty
(30) Days of
Design-Builder's notice that the Plant is ready for Performance
Testing, then
Design-Builder shall be excused from demonstrating compliance with
the
Performance Guarantee Criteria during such period of time that
Design-Builder is
prevented from demonstrating compliance with the Performance
Guarantee Criteria;
provided however that Design-Builder will be deemed to have
fulfilled all of its
obligations to demonstrate that the Plant meets the Performance
Guarantee
Criteria should such period of time during which Design-Builder is
prevented
from demonstrating the Performance Criteria exceed thirty (30) Days
or extend
beyond Final Completion.
7.2 Performance Testing.
Green Plains Renewable Energy, Inc.
January 13, 2006
20
<PAGE>
7.2.1 The Design-Builder shall direct and supervise the tests
and, if necessary, the retests of the Plant using Design-Builder's
supervisory
personnel and the Air Emissions Tester shall conduct the air
emissions test, in
each case, in accordance with the testing procedures set forth in
Exhibit A (the
"Performance Tests"), to demonstrate, at a minimum, compliance with
the
Performance Guarantee Criteria. Design-Builder shall cooperate with
the Air
Emissions Tester to facilitate performance of all air emissions
tests. To the
extent that Owner's employees, or third parties that are not
Subcontractors, are
involved in the Performance Testing and conducting the Performance
Tests
pursuant to the direction of the Design-Builder, the failure of
such third
parties or Owner's employees to properly follow the directions of
the
Design-Builder in conducting the Performance Tests, except in
instances of the
willful misconduct or gross negligence of such third parties or
Owner's
employees, shall not relieve the Design-Builder of its obligation
to meet the
Performance Tests. Design-Builder shall not be held responsible for
the will