ANSUPPLY AGREEMENT* BETWEEN ORICAINTERNATIONAL PTE LTD. AND ELDORADO CHEMICAL COMPANY JANUARY1, 2010

Schedule “A”

Definitions

Schedule “B”

Product Specifications

Schedule “C”

***

Schedule “C-1” 

Year 2010 Annual Budget

Schedule “D”

Measurement of Ammonia and Ammonium Nitrate Deliveries

Schedule “E” 

Types of Unusual Incidents to be Reported to Orica

Schedule “F”

True Up Report

Schedule “G”

Capital Cost Recovery for Specified Assets

(a)

Orica requires AN Prills, HDAN and AN Solution for its commercial explosives business; and

(b)

EDC wishes to manufacture AN Prills, HDAN and AN Solution for delivery to Orica.

Capitalized words used in this Agreement and in the Schedules hereto, unless otherwise defined herein, have the definition given to those words in Schedule “A”.

This Agreement has the following Schedules which are a part hereof:

 

Schedule “C”

*** Calculation and *** Calculation

 

Schedule “D”

Measurement of Ammonia and Ammonium Nitrate Deliveries

 

Schedule “F”

True Up Report

 

Schedule “G”

***

This Agreement shall become effective as of January 1, 2010 and, unless earlier terminated in accordance with the provisions hereof, shall continue for an initial term (“Initial Term”) ending on December 31, 2014. Thereafter the term of this

Notwithstanding the termination of this Agreement, the unfulfilled rights and undischarged obligations of the parties that accrue during the Term shall continue following the termination hereof until the same are fulfilled or discharged.

The current term of the Koch Ammonia Agreement expires on December 31, 2010.  The Koch Ammonia Agreement contemplates that EDC will purchase approximately 45,000 Tons of Ammonia that will be used in the production of AN to be purchased by Orica under this Agreement.  . The cost to EDC of such Ammonia shall be included in the amounts owed by Orica to EDC under Section 14.2.1 (a) of this Agreement.

Orica is not and shall not be deemed to be a party to the Koch Ammonia Agreement.

Orica acknowledges and agrees that, prior to December 31, 2010, Orica shall not be permitted to supply its own Ammonia in substitution for the 45,000 Tons of Ammonia to be supplied under the Koch Ammonia Agreement nor require EDC to supply the 50,000 Tons of Ammonia Orica will supply from another supplier, in either case without the consent of KNC/KNI.

EDC will provide to Orica material information in EDC’s possession regarding the operation of the Koch Ammonia Agreement and will provide copies to Orica of any material notices or other correspondence EDC receives from or issues to KNC/KNI in respect of the Koch Ammonia Agreement.

EDC shall consult with Orica prior to the exercise by EDC of any of the rights conferred upon it pursuant to Sections I.H, VI.D, VII.A, XI.B, XII and XIV of the Koch Ammonia Agreement.

EDC shall not, without obtaining Orica’s prior written approval, exercise any of the rights conferred upon it pursuant to Sections I.P, II.B, III.B (unless the resale, transfer, exchange or assignment does not affect Ammonia to be supplied to Orica), V.B, or XV (unless any such amendment has no effect on Orica) of the Koch Ammonia Agreement relating to the 45,000 Tons of Ammonia to be supplied by EDC to Orica prior to December 31, 2010.

EDC shall be solely responsible for any costs or expenses claimed against EDC by KNC/KNI pursuant to Article XI Section A of the Koch Ammonia Agreement, except to the extent that any such costs or expenses are directly attributable to any failure by Orica to timely make payment to EDC in accordance with Section 3.6 of this Agreement.

Notwithstanding any other provision of this Agreement and unless otherwise agreed in writing, EDC shall not be obligated to supply Ammonia hereunder for the manufacture of AN for Orica (a) if EDC fails to provide Ammonia prior to December 31, 2010 but such failure is not caused by any default of EDC under the Koch Ammonia Agreement or (b) after December 31, 2010.

Prior to December 31, 2010, Orica will supply 50,000 Tons of Ammonia to EDC from a supplier other than KNI/KNC and EDC agrees to accept deliveries of such Ammonia in the same manner as in Section 3.4 of this Agreement.  The cost to EDC of such Ammonia shall be included in the amounts owed by Orica to EDC under Section 14.2.1 (b) of this Agreement.

From and after January 1, 2011, to the extent Ammonia is available from EDC’s supplier or suppliers at costs acceptable to Orica (which shall not exceed EDC’s delivered to the EDC Site cost of Ammonia from EDC’s supplier), EDC shall acquire up to 58,000 Tons of Ammonia for use to manufacture AN for Orica under this Agreement for such periods as shall be requested by Orica. For the 58,000 Tons of Ammonia EDC is supplying, Orica shall give EDC at least 45 days’ advance notice of the quantities of Ammonia Orica requires EDC to acquire to be used by EDC for manufacturing AN for Orica.  The cost to EDC of such Ammonia shall be included in the amounts owed by Orica to EDC under Section 14.2.1 (a) of this Agreement.

From and after January 1, 2011, and subject to the terms and conditions hereof, Orica shall  supply to EDC, and EDC shall receive from Orica, up to 58,000 Tons of Ammonia from a supplier other than KNI/KNC at the times as required by EDC for conversion by EDC to meet Orica’s demand for AN hereunder.  EDC shall provide Orica with at least 30 days’ advance notice of (a) the quantities of Ammonia it requires during the succeeding one-month period to meet Orica’s demand for AN and (b) the required delivery dates of such Ammonia.  The parties shall cooperate in arranging such Ammonia deliveries.  Upon delivery Orica shall sell such Ammonia to EDC and EDC shall pay Orica for such Ammonia on or before the first day of the second Month succeeding the Month in which such Ammonia was delivered to EDC by Orica e.g. January Ammonia deliveries are paid for on March 1st. The cost to EDC of such Ammonia shall be included in the amounts owed by Orica to EDC under Section 14.2.1 (b) of this Agreement.

If when Orica is supplying Ammonia, Orica is unable to supply the required Ammonia, or if when EDC is supplying Ammonia, EDC is unable to acquire and supply sufficient Ammonia from its supplier, Orica may request EDC to utilize

If EDC is supplying Ammonia from its supplier, Orica shall reimburse EDC for its actual out of pocket delivered to the EDC Site cost of such Ammonia within the earlier of (a) eighteen (18) days from the Monday during the week KNC’s /KNI’s invoice is prepared under the Koch Ammonia Agreement and faxed to EDC, or (b) three (3) days before the date required by the payment terms in the Koch Ammonia Agreement. If the payment due date is not a Business Day,  Orica shall make the payment on the next Business Day.

Based on the current Ammonia conversion efficiency of the EDC Plant and with the current onsite equipment, the parties agree that for each Ton of AN to be manufactured by EDC for Orica, EDC will require *** of a Ton of Ammonia which shall include the Ammonia utilized in the SCR abatement system.

When Orica is independently sourcing and delivering Ammonia to the EDC Site, and for the purpose of storing that Ammonia, Orica shall be entitled to use 35% of the available Ammonia storage capacity at EDC’s Site during the Term.  As of the date of this Agreement, such useable Ammonia storage capacity is 10,000 Tons and so Orica is entitled to use storage capacity of 3,500 Tons.  EDC shall at all times during the Term when Orica is supplying its own ammonia to the EDC Site, maintain an aggregate Ammonia storage capacity available to Orica at the EDC Site of at least 3,500 Tons, less any temporary reduction in Ammonia storage capacity as required by safety, inspection and maintenance procedures.  EDC shall use its commercially reasonable efforts to limit the duration of any such storage capacity reductions.  If Orica requires additional ammonia storage capacity to be installed at the EDC Site, this requirement shall be subject to a future negotiation between the parties.  When Orica is using EDC’s Ammonia storage facilities for Orica’s benefit, Orica will pay to EDC the pro-rata variable and *** associated with the operation of these facilities.

During the Term, EDC shall reserve for Orica under this Agreement at the EDC Site and the EDC Plant:

Orica shall determine the rate at which the AN Prills Plant will operate provided that Orica will endeavor to avoid and minimize both the frequency and duration of any cessation of production.  Cessation and resumption of production will be subject to the following:

 

(a)  Orica will provide no less than:

 

(i) 2 days notice to EDC to have AN Prills production reduced or increased by up to 10%;

 

(ii) 5 days notice to EDC to have AN Prills production reduced by an amount over 10% down to the minimum production rate of approximately 400 Tons per day, or increased by an amount over 10% up to the maximum production rate of approximately 900 Tons per day, such production rates being subject to the impact of seasonal (ambient temperature and humidity) effects on the process and the availability of higher strength nitric acid to achieve a minimum AN Solution strength of 88 percent; and

 

(iii) 10 days notice to EDC to have AN Prills production shutdown.  Upon receipt of such notice, and if EDC is supplying Ammonia to Orica, EDC will provide notice to its then-current Ammonia and Ammonia pipeline transportation supplier(s) of the reduction of Ammonia demand. Orica’s notice to EDC will also specify the expected duration of the shutdown, if known, and Orica must give EDC 4 days notice prior to Orica’s requested date for restart of the AN Prills Plant.  During a cessation of production, EDC shall obtain Orica’s approval prior to commencing any optional maintenance or optional repair work which cannot be completed within 4 days from receiving an Orica notice to restart the AN Prills Plant.

 

(b) In order to enable EDC to mitigate costs resulting from a production shutdown at the AN Prills Plant, Orica will use reasonable efforts to provide EDC with as

Orica shall pay to EDC the *** calculated in accordance with Schedule “C” hereof for each Ton of Ammonium Nitrate delivered to Orica which conforms to the Specifications set forth in Schedule “B” hereto and otherwise in accordance with this Agreement.  Orica shall also pay to EDC the *** as set forth in Schedule “C” hereto.

Provided that Orica timely supplies Ammonia in the quantities required and meeting the quality specifications set forth in Schedule “B” hereto, and Orica is otherwise in compliance with this Agreement, EDC shall deliver to Orica AN produced by EDC in the quantities and at the times required by Orica and provided for herein, except to the extent excused by the terms of this Agreement or any applicable Law prohibiting or preventing the manufacture of AN generally, but in no event at a rate in excess of the operating capacity of the EDC Plant and quantities that can be shipped from any storage.

No changes shall be made by EDC to the additives in, or the coatings on, the AN Prills without prior written notice to and the prior written consent of Orica.

Orica shall be the sole marketer to the commercial explosives industry of AN Solution and AN Prills manufactured at the EDC Site. Orica shall be the sole marketer to the commercial explosives industry of HDAN manufactured at the EDC Site and destined for use in the United States, Canada and Mexico (“North America”).  EDC shall refer to Orica any inquiries EDC receives during the Term concerning the supply by EDC of AN from the EDC Site to commercial explosives customers for use in North America.  Subject to Section 4.7 above, Orica shall have the right to purchase HDAN, at the HDAN price herein, for use in the commercial explosives industry outside North America.  EDC will not sell any nitric acid manufactured at the EDC Site to anyone for use in North America if EDC knows that such party will use such nitric acid for the manufacture of AN Solution for conversion into emulsion explosives, provided that nothing herein is intended to prevent or limit the sale by EDC of nitric acid or nitric acid mixtures for use in the production of ordnance or for use in the production of nitrated explosives for the commercial explosives industry.  However if regulatory changes occur in the United States after the date of this Agreement which changes have the effect of totally or substantially preventing the manufacture of HDAN at the EDC Site, or substantially negatively impact the commercial viability of the sale or distribution of HDAN from the EDC Site, with the result that EDC’s requirement for nitric acid for use to manufacture HDAN is substantially lessened, then if EDC desires to sell such nitric acid for use in the production of commercial explosives, EDC will offer such available nitric acid to Orica and if Orica elects not to purchase such nitric acid, then EDC shall be free to sell such nitric acid without restriction.

All AN Prills supplied to Orica shall be manufactured using EDC’s current technology, and shall meet the specifications set forth in the AN Prill Specifications set forth on Schedule “B” hereto  Orica’s rights and EDC’s liabilities and obligations with respect to AN Prills which do not meet the AN Prill Specifications shall be governed by Section 8.1.

EDC is duly organized, validly existing, and in good standing under the laws of the State of Oklahoma, and has all requisite power and authority to own and lease the properties and assets it currently owns and leases, including at the EDC Site, and to conduct its activities as such activities are currently conducted.

EDC has all requisite corporate power, authority and capacity to execute, deliver, and perform this Agreement and to consummate the transactions contemplated hereby.  The execution, delivery, and performance of this Agreement and the

 

consummation of the transactions contemplated hereby by EDC have been duly and validly authorized by all necessary action on the part of EDC (including approval by the board of directors and shareholders of EDC), and this Agreement has been duly and validly executed and delivered by EDC, and is the valid and binding obligation of EDC, enforceable against EDC in accordance with its terms, subject to applicable laws of bankruptcy, insolvency and similar laws affecting creditors’ rights and remedies generally.

The execution, delivery, and performance by EDC of this Agreement does not and will not (i) conflict with or violate any provision of the articles of incorporation or bylaws of EDC; (ii) violate any provision of any Laws; (iii) conflict with, violate, result in a breach of, constitute a default under (without regard to requirements of notice, lapse of time, or elections of other persons, or any combination thereof) or accelerate or permit the acceleration of the performance required by, any material contracts to which either EDC is a party or by which either EDC or the EDC Site are bound or affected; (iv) result in the creation or imposition of any lien against or upon the EDC Site or any portion thereof, or the Ammonia, or the AN; or (v) require any consent, approval, or authorization of, or filing of any certificate, notice, application, report, or other document with, any Government or other person.

EDC is currently in compliance with all Laws applicable to the ownership and operation of the EDC Site, except for such non-compliance as would not have a material adverse effect on EDC’s ability to perform hereunder, and EDC is not subject to any Law, judgment, decree or sanction that would preclude the delivery, receipt and processing of the Ammonia, or any of the other activities contemplated to be performed by it under the Agreement.

Orica is duly organized, validly existing, and in good standing under the laws of Singapore, and has all requisite power and authority to own and lease the properties and assets it currently owns and leases and to conduct its activities as such activities are currently conducted.

Orica has all requisite corporate power, authority and capacity to execute, deliver, and perform this Agreement and to consummate the transactions contemplated hereby.  The execution, delivery, and performance of this Agreement and the consummation of the transactions contemplated hereby by Orica have been duly and validly authorized by all necessary action on the part of Orica (including approval by the board of directors and shareholders of Orica), and this Agreement has been duly and validly executed and delivered by Orica, and is the valid and binding obligation of Orica, enforceable against Orica in accordance with its terms, subject to applicable laws of bankruptcy, insolvency and similar laws affecting creditors’ rights and remedies generally.

The execution, delivery, and performance by Orica of this Agreement does not and will not (i) conflict with or violate any provision of the articles of incorporation or bylaws of Orica; (ii) violate any provision of any Laws; (iii) conflict with, violate, result in a breach of, constitute a default under (without regard to requirements of notice, lapse of time, or elections of other persons, or any combination thereof) or accelerate or permit the acceleration of the performance required by, any material contracts to which either Orica is a party or by which Orica is bound or affected; (iv) result in the creation or imposition of any lien against or upon the Ammonia or AN; or (v) require any consent, approval, or authorization of, or filing of any certificate, notice, application, report, or other document with, any Government or other person.

Orica is currently in compliance with all Laws applicable to the ownership and operation of Orica’s business, except for such non-compliance as would not have a material adverse effect on Orica’s ability to perform hereunder and Orica is not subject to any Law, judgment, decree or sanction that would preclude the delivery of the Ammonia and receipt of the AN, or any of the other activities contemplated to be performed by it under the Agreement.

Orica shall also deliver to EDC during the Term within 15 days after the release of Orica Limited’s results to the Australian stock exchange, annual (as of September 30) and semi-annual (as of March 31), consolidated balance sheets, income statements and statements of cash flow for Orica and for any subsidiary of Orica in which it then owns at least 51% of the equity interest (“Financial Statements”).  The Financial Statements shall be audited and prepared in accordance with Australian generally accepted accounting principles, and signed by an authorized financial officer of Orica.  Orica shall also deliver to EDC during the Term within 15 days after the preparation thereof, quarterly (as of December 31 and June 30) Financial Statements. Without limiting the generality of the other confidentiality provisions of this Agreement, EDC acknowledges and agrees that the December 31 and June 30 Financial Statements contain highly confidential non-public information, and covenants that it shall not, and it shall cause its officers, directors, employees, agents and representatives not to, disclose the Financial Statements or information contained therein to any person or entity other than EDC’s officers for the purposes of conducting periodic credit reviews, on a need to know basis, nor use such Financial Statements to the detriment of Orica nor for any other purpose.

Orica warrants that the Ammonia delivered by Orica to EDC from time to time hereunder will be delivered by pipeline and will conform to the Ammonia Specifications set forth in Schedule “B” hereto.  EDC agrees to use the same efforts it expends on its own behalf  to ensure that the Ammonia acquired and supplied by EDC to Orica will conform to the Ammonia Specifications set forth in Schedule “B” hereto. EDC shall reject any ammonia from its supplier which does

 

not conform to such specifications, and shall be responsible for arranging with its supplier adequate supplies of conforming replacement Ammonia. Such Ammonia will be shipped by pipeline provided such pipeline is available for shipments.

Orica shall use commercially reasonable efforts, at its own expense, to cause its Ammonia supplier to provide a certificate of analysis. Further, at its own expense, Orica shall periodically cause such Ammonia to be analyzed prior to delivery into EDC’s storage tank as may be reasonably required by EDC and the report of such analysis shall be provided to EDC upon request.  Additional sampling and subsequent analysis of the Ammonia may be conducted by EDC in its discretion in accordance with standard methods of the American Society of Testing Materials, or by such other methods as may be agreed by Orica and EDC.  EDC and Orica will retain any samples that such party takes for at least 60 days from the date of delivery to be analyzed if a dispute arises as to the quality of the Ammonia.

If, based on the supplier’s certificate of analysis or the analysis of the samples by EDC, any ammonia delivered by Orica to EDC does not meet the Ammonia Specifications, EDC shall, as soon as practicable following such determination, notify Orica in writing that such ammonia does not meet such Specifications.  Orica shall be solely responsible for any demurrage, freight or transportation costs, removal costs, tank cleaning costs and other costs which are a direct result of Orica’s delivery of nonconforming Ammonia.  If EDC does not notify Orica that such ammonia does not meet the Ammonia Specifications within 30 days after delivery to the EDC Site, the Ammonia shall be deemed to meet the Ammonia Specifications.  In the event that Orica disagrees with EDC’s analysis, Orica will give EDC notice within 30 days of receipt of EDC’s notice, in which event the sample retained by EDC will be, and any sample retained by Orica may be, submitted for independent analysis to a mutually acceptable commercial laboratory.  The laboratory’s analysis of such sample or samples shall be final and binding on the parties.  The cost of the laboratory’s independent analysis will be borne by Orica if the ammonia is off-specification and by EDC if the Ammonia meets the Specifications.

Orica warrants that it has good title to, and the right to supply, all Ammonia delivered or supplied by Orica to EDC from time to time hereunder free and clear of all Claims, liens, security interests, encumbrances and charges.

Provided that Orica supplies to EDC, or EDC is able to obtain from its supplier, sufficient Ammonia to meet the Monthly forecast AN requirements and the Ammonia Specifications, EDC warrants that all AN delivered to Orica from time to time hereunder shall conform to the Specifications set forth in Schedule “B” hereto, as applicable.

EDC shall take samples of AN delivered by EDC to Orica from each truck or rail car upon loading at the EDC Plant.  Orica may take samples of AN upon arrival at Orica’s destination.  Analysis of the samples shall be conducted by the sampling party in accordance with the standard methods of the American Society of Testing Materials, or by such other methods as may be agreed by Orica and EDC.  Each party shall retain any such samples for at least 60 days from the date of sampling to be analyzed if a dispute arises as to the quality of the AN.

If, based on analysis of the samples by EDC, any AN delivered or to be delivered by EDC to Orica does not meet the applicable AN Specifications, EDC shall so notify Orica in writing and shall not ship such AN without Orica’s written approval.  Subject to the terms of sale agreed in writing between Orica and EDC regarding such shipments, which terms may vary from those set forth in this Agreement, any nonconforming AN shipped with Orica’s approval shall be deemed to be in compliance with this Agreement, provided that any such acceptance shall not be deemed a waiver for any other nonconforming AN.  If Orica does not notify EDC that AN does not meet the applicable Specifications within (45) days of the date of receipt thereof, the AN shall be deemed to meet the relevant Specifications.  In the event that either party disagrees with the other party’s analysis of the samples, the disagreeing party shall give the other party notice within 15 days of receipt of the results of the analysis, in which event the retained sample or samples shall be submitted for independent analysis to a mutually acceptable commercial laboratory.  The laboratory’s independent analysis shall be final and binding on the parties.  The cost of the independent laboratory’s analysis will be borne by EDC if the AN is off-Specification and by Orica if the AN meets the Specifications.

EDC agrees to apply the same loading inspection standards and procedures to all trucks, tank trucks and rail cars used to transport AN, irrespective of the carrier.  EDC agrees to promptly provide to Orica a copy of such standards and procedures in effect as of the Effective Date, together with copies of any revised standards and procedures subsequently adopted by EDC.

EDC warrants that it has good title to, and the right to supply, all AN supplied and delivered to Orica from time to time hereunder free and clear of all Claims, liens, security interests, encumbrances and charges, and that EDC has the manufacturing and conversion capability and capacity, and the right, to supply such AN to Orica at the rates, times and quantities contemplated by this

 

Agreement.  EDC has all necessary authorizations, approvals and permits to receive the Ammonia at EDC’s Site, to process the same to produce AN, and to undertake all of the other activities contemplated to be performed by it in accordance with this Agreement.

Orica’s exclusive remedies for any non-conforming AN supplied hereunder, other than any nonconformance to the extent caused by non-conforming Ammonia, shall be, at Orica’s option, to (a) reject such non-conforming AN without penalty, or (b) accept such AN but at a price per Ton reduced by agreement of the parties.  In the event that Orica rejects any nonconforming AN, EDC will cause such nonconforming AN to be promptly removed from its current location at EDC’s cost, and EDC will take all necessary measures to promptly provide Orica with replacement AN meeting the applicable Specifications at that location at no additional cost to Orica.  EDC will be responsible for any additional demurrage, freight or transportation costs or other actual out-of-pocket costs incurred by Orica which are a direct result of EDC’s delivery of non-conforming AN.  In the further event that Orica rejects the nonconforming AN, but EDC is unable to deliver replacement AN to Orica within the time period necessary to meet the needs of Orica’s customers, Orica shall have the right, commencing on the business day following delivery of written notice to EDC,  to purchase a like quantity of AN from an alternative supplier and EDC shall reimburse Orica for Orica’s cost to purchase and deliver replacement AN from the alternative supplier to the location of the nonconforming AN. In the event of production or delivery by EDC of non-conforming AN, the parties shall cooperate in good faith in identifying means by which to mitigate loss or damage attributable to such nonconformance; provided that Orica shall be solely responsible for any nonconformance of AN supplied hereunder to the extent caused by non-conforming Ammonia.  EDC may dispose of any such non-conforming AN returned to it by sale to agricultural customers.

EDC shall have no liability to Orica for loss of or shortage in quantity of AN supplied or to be supplied hereunder solely as a result of EDC’s loading of, or the short-filling of, rail cars or trucks unless Orica notifies EDC in writing within 45 days from the date of receipt of the AN.  Provided that Orica has timely given such notice, its exclusive remedy for any loss of or shortage in quantity of AN

Except with respect to Orica’s rights set out in Sections 8.1 and 8.2, Orica hereby releases and forever discharges EDC, its agents, employees, successors and assigns, from all Claims relating to non-conformance with Specifications, or loss or shortage in quantity, of AN supplied by EDC pursuant to this Agreement.  In no event whatsoever shall either party be liable to the other for loss of profits or special, indirect or consequential damages, save and except for Orica’s obligation to pay the *** as set out in Section 14.2.1 (e) hereof and EDC’s obligation, if applicable, to refund the *** (included in the ***) as set out in Section 8.2 hereof and to refund, if already paid,  the *** when Orica is relieved from its obligation to pay to EDC the *** as set out in Schedule “C” hereto.

Subject to Section 8.1, following the delivery of AN to Orica hereunder and removal of such AN from the EDC Site, Orica assumes all risks and responsibility in connection with the further handling or use of such AN, whether used singly or in combination with other products.  Orica agrees to indemnify, defend and hold harmless EDC and its Affiliates from and against any and all Claims incurred or suffered by, or threatened against EDC or its Affiliates in connection with such further handling or use of such AN.

Actual measurement of quantities of Ammonia and AN delivered and the supplied party’s rights to dispute such measurements will be as set out in Schedule ”D”.

All Ammonia which is supplied by Orica shall be supplied by pipeline. All Ammonia acquired and supplied by EDC hereunder shall be supplied by pipeline, and EDC shall be responsible for making the necessary  shipment arrangements to the extent Ammonia is available to EDC.

Ammonia supplied by pipeline shall be delivered to EDC’s Ammonia storage tanks and metered by the NuStar metering device at the EDC Site.  Absent demonstrable error, EDC and Orica agree that the amount of Ammonia delivered by pipeline shall be conclusively determined by the NuStar metering device and the amount of Ammonia so metered shall be used for billing to Orica hereunder.

Unless otherwise agreed, EDC shall deliver all AN supplied hereunder into trucks, tank trucks or rail cars supplied by Orica.

Unless otherwise agreed, EDC shall load (a) AN Solution into Orica’s rail tank cars and release such cars within 7 days from the arrival of such cars at EDC’s Site provided that EDC shall not be required to load more than 2 rail tank cars per 24 hour period, (b) AN Prills and HDAN into Orica’s rail hopper cars and release such cars within 7 days from the arrival of such cars at EDC’s Site provided that EDC shall not be required to load more than 10 rail hopper cars per 24 hour period, and (c) AN into Orica’s trucks and release such trucks within the free loading period allowed by the carrier provided that EDC shall not be required to load more than 24 trucks per 24 hour period. All of the foregoing time frames shall be extended by any intervening weekend, holiday, or Force Majeure event; and provided further that in no event shall EDC be required to load in one day any more than one day’s actual production rate of AN Solution and one day’s actual production of AN Prills.  Should EDC fail to comply with the foregoing, EDC shall reimburse Orica, within 30 days of receipt of an invoice from Orica, for all demurrage and other out-of-pocket expenses incurred by Orica resulting from such delay.  Orica shall use commercially reasonable efforts to schedule rail cars or trucks for the EDC Plant at a rate that will permit EDC to load such cars and trucks within the time frames set forth in clauses (a) through (c) above, taking into account reasonably anticipated AN production rates.***

Title to all AN manufactured hereunder shall be in Orica, and delivery to Orica shall occur and all risks of loss and otherwise in relation thereto shall pass to Orica upon and after the delivery of the AN into Orica’s owned or contracted-for trucks or railcars at the EDC Plant.  EDC shall physically segregate all AN Prills manufactured for Orica from all other AN at the EDC Site.

EDC shall weigh, by means of certified scales and otherwise in accordance with Schedule “D”, all trucks and rail cars before and after they have been loaded, to determine the net weight of AN delivered to Orica.

EDC shall promptly confirm to Orica any shipment made, specifying the carrier, the date of departure, the weight of AN in each rail car or truck and its destination.  EDC shall also promptly forward to Orica one copy of each bill of lading issued with respect to such shipments.  Absent demonstrable error, the carrier’s weight measurements shall be deemed correct and shall be controlling.  The carrier which shall receive delivery of AN at EDC’s Plant shall be deemed authorized by Orica to execute the bill of lading for the shipment; provided, however, that authorization shall not affect Orica’s rights pursuant to Sections 7 and 8 hereof.

Orica may from time to time request EDC to assist Orica in obtaining repair of Orica’s rail cars at EDC’s facilities located at the EDC Site.  EDC shall use its commercially reasonable efforts to obtain such services on Orica’s behalf, and at Orica’s expense.

EDC shall use its commercially reasonable efforts to minimize loss and shrinkage of AN during storage and handling, but such loss and shrinkage shall be to Orica’s account.

No later than August 31 of each Year during the Term, Orica shall deliver to EDC a forecast of its requirements for AN for the succeeding Year.  Orica shall also deliver to EDC Monthly a forecast of its requirements for AN for the succeeding 120 days.  The Monthly forecast is an estimate for planning purposes and is not a commitment to take AN at the Monthly rates estimated.

Orica and EDC will conduct quarterly contract review meetings during the Term of this Agreement which meetings shall include a review of cost performance Year to date versus the Annual Budget for that Year.

In consideration of EDC making available the Reserved Capacity for Orica, Orica shall pay to EDC the *** calculated on the basis set out in Schedule “C” to this Agreement.

EDC shall invoice Orica and Orica shall pay to EDC the amounts owing by Orica to EDC under this Agreement for:

 

and be paid by Orica on or before the first day of the second Month succeeding the Month in which the AN was delivered to Orica e.g. January deliveries are *** paid for on March 1st.

Orica shall, in addition to all other amounts payable hereunder, be responsible for or shall reimburse EDC (subject to receipt of reasonable documentation reflecting payment by EDC), as the case may be, for all sales, value added or transfer taxes or Governmental fees levied or imposed, or charges or costs payable to a Government and attributable to compliance with Governmental orders or Laws issued or adopted after the date hereof, in connection with the supply of AN hereunder; provided that in no event shall such amount include amounts relating to fines and penalties or fees and expenses arising therefrom or income taxes payable by EDC.  EDC may, where required by Laws, collect from Orica any such tax, fee, charge or other cost and remit it to the appropriate Government.  Any such tax, fee, charge or other cost shall be paid by Orica in addition to the *** to be paid hereunder.  If any such tax or fee paid by Orica is adjusted as a result of any reassessment by any Government, then any increase or decrease in any such tax or fee and any interest and penalties (except to the extent attributable to the negligence of EDC) resulting from the reassessment is for Orica’s account.

Notwithstanding anything herein contained, each party will be excused from performance of its obligations hereunder, other than (a) an obligation to pay money (including Orica’s obligation to make the payments provided for in Section 14.2.1 except in the circumstances where Orica is relieved from its obligations to pay to EDC the *** as set out in Schedule “C” hereto) or (b) to indemnify, in the event and to the extent such failure is caused by an event of Force Majeure.  If an event of Force Majeure occurs, the party whose performance is excused shall immediately provide written notice to the other party of the event of Force Majeure, the nature of the event, the extent to which the event of Force Majeure affects or delays the affected party’s performance hereunder, the particular obligations so affected, the steps taken and proposed to be taken to lessen and cure the Force Majeure, and the estimated duration of the event of Force Majeure.  If there is any material change, addition or alteration to the circumstances giving rise to, or in the information provided pursuant to, the written notice, the affected party shall provide the other party with written notice of the same. At all times during an event of Force Majeure, both parties shall use reasonable means to avoid or minimize the consequences of any event of Force Majeure; provided that nothing contained in this Agreement shall be construed as requiring either party hereto to accede to the demands of labor or labor unions it considers unreasonable.  The performance of this Agreement shall be resumed as soon as practicable after such disability has been removed.

If an event of Force Majeure impairs EDC’s ability to produce nitric acid or deliver AN Solution or HDAN under this Agreement, EDC shall allocate its available production of nitric acid, AN Solution and HDAN manufactured at EDC’s Site and available for supply among all of EDC’s customers then supplied or which are

An event of Force Majeure shall not extend the term of this Agreement.

Either party may terminate this Agreement upon written notice to the other party in the event the other party shall commence, or there shall be commenced against the other party, any case, proceeding or other action (which shall not have been dismissed within 60 days of commencement) seeking to have an order for relief entered with respect to such party or to adjudicate such party as a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment, liquidation, dissolution or composition under any Law relating to bankruptcy, insolvency, reorganization or relief of debtors or seeking appointment of a receiver, trustee, custodian or other similar fiduciary with respect to any part of such party’s business or property or the other party makes a general assignment for the benefit of its creditors.

If an event of Force Majeure claimed by EDC or Orica persists for a continuous period of at least 180 days or if the duration of an event of Force Majeure claimed by EDC or Orica is estimated by the party claiming Force Majeure to be 180 days or longer, then the party not claiming the Force Majeure shall have the right, but not the obligation, to terminate this Agreement and the obligations of the parties hereto, except for claims in dispute and payments and other obligations then due and owing, by giving written notice of termination to the other party. For purposes of this Section 16.2, if the period between the end of one event of Force Majeure and the commencement of another event of Force Majeure is less than 30 days, the Force Majeure shall be deemed to be continuous, but the time between the Force Majeure periods shall not be counted in determining the 180 day period required before termination hereunder is allowed.

EDC may terminate this Agreement on 14 days prior written notice to Orica if Orica delivers ammonia to EDC which does not meet Ammonia Specifications and if, after EDC has given notice to Orica pursuant to Section 6.3, Orica has not within 45 days of receipt of such notice, commenced deliveries of Ammonia meeting the Ammonia Specifications.

Orica may terminate this Agreement on 14 days prior written notice to EDC if EDC delivers AN to Orica which does not meet the applicable AN Specifications, and if, after Orica has given notice to EDC pursuant to Section 7.3, EDC has not within 45 days of receipt of such notice, commenced delivery of at least 95% of the prior volumes of AN which meets the relevant Specifications.

Either party may terminate this Agreement if the other party defaults in the due and punctual payment of any amounts owing to the non-defaulting party or fails to perform any material obligation and such default or failure continues for 30 days after the non-defaulting party gives written notice to the defaulting party advising of the default or failure and the intention to terminate this Agreement in the absence of payment or performance.

Either party may terminate this Agreement pursuant to a notice given in accordance with Section 27.5 hereof.

Orica may terminate this Agreement upon five days prior notice to EDC in the event (a) of major damage to, destruction of, or a loss of production capacity at, EDC’s Plant, and (b)(i) within 180 days of such damage, destruction or loss of production capacity, EDC’s Plant is not or cannot be restored to a level of production sufficient to supply the Reserved Capacity, as determined by Orica acting in good faith and after consultation with EDC, or (ii) the cost to repair such damage, rebuild EDC’s Plant or restore the production capacity (after taking into account any insurance recovery by EDC) will result in an increase in the ***.  Nothing in this Section 16.7 shall be deemed to prevent EDC from repairing such damage, rebuilding the EDC Plant or restoring its production capacity at its sole cost within a 180-day period, in which event such costs shall not be included in the *** and Orica shall have no right to terminate under this Section 16.7.

The termination of this Agreement for any cause whatsoever shall not release a party from any liability which at the time of termination has already accrued to the other party or which may thereafter accrue in respect of any act or omission prior to termination.

The rights and remedies of the parties under this Agreement are cumulative and, subject to the limitations expressed in this Agreement, the exercise of a remedy by a party shall not preclude the right of such party to exercise any other remedy available to such party in accordance with the terms of this Agreement or otherwise.

If, at any time during the Term of this Agreement, there occurs a substantial change in the business, technical or commercial conditions which adversely affects the business or financial condition of either party to this Agreement, or a substantial change in Laws applicable to this Agreement or its performance by either party, as a result of which a party incurs or would be likely to incur substantial hardship in complying with the provisions of this Agreement, the party experiencing hardship may notify the other in writing that it wishes to discuss the terms and performance of this Agreement in light of such changed conditions.

Within 30 days after any notice under Section 17.1 above, the parties shall meet in Oklahoma City at a mutually acceptable time to discuss in good faith appropriate means, if any, to relieve such hardship in a manner equitable to both parties and at such meeting the party alleging hardship shall make available such data and information as it deems necessary to justify its request for relief. For the avoidance of doubt, nothing in this Section 17 shall alter the rights and obligations of the parties to supply and purchase AN or supply Ammonia under this Agreement in any way except to the extent that the parties agree to do so in writing at or following any such meeting.

EDC shall procure and maintain, at EDC’s sole expense (but subject to Schedule “C”), at all times during the Term of this Agreement:

Commercial General Liability Insurance

Automobile Liability Insurance

Workers’ Compensation Insurance

Excess Liability Insurance

Business Interruption Insurance

Property Insurance

Environmental Impairment Liability (EIL) Insurance

General Terms

Orica shall procure and maintain, at Orica’s sole expense, at all times during the Term of this Agreement:

Automobile Liability Insurance

Workers’ Compensation Insurance

Excess Liability Insurance

Business Interruption Insurance

Property Insurance

General

Except as otherwise provided herein, the parties shall attempt in good faith to promptly resolve any controversy or claim arising out of or relating to this Agreement, or the interpretation, performance or breach hereof (any of the

 

foregoing, a “Dispute”), by negotiations between the Chief Executive Officers of each party.  The disputing party shall give the other party written notice of the Dispute.  Within 15 days after receipt of such notice, the receiving party shall submit a written response to the other party.  The notice and response shall include a statement of each party’s position on the Dispute and a summary of the evidence and the arguments supporting its position.  The Chief Executive Officer (or his designee) of each party shall meet at a mutually acceptable time and place within 20 days after the date of the disputing party’s notice and thereafter as often as they reasonably deem necessary to exchange relevant information and to attempt to resolve the Dispute.  All negotiations and discussions pursuant to this Section 19.1 shall be confidential and shall be treated as compromise and settlement negotiations for purposes of the Federal Rules of Evidence and the Colorado Rules of Evidence.

If the Dispute remains unresolved for a period of 60 days following delivery by the disputing party of the notice referred to in Section 19.1, it shall be thereafter be settled by arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules.  The arbitration shall take place in Denver, Colorado.  The parties shall, prior to referring any Dispute to arbitration, agree in writing upon the issue or issues to be arbitrated.  The arbitrator(s) shall be instructed to reach a decision based only on the facts and information supplied by the parties during the proceeding.  The parties agree that such referral and the arbitration award shall be binding on both parties.  Judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. Notwithstanding any of the provisions or limitations of Sections 19.1 or 19.2, any demand for arbitration must be filed in writing with the other party and with the American Arbitration Association prior to the date when institution of legal or equitable proceedings based upon the Dispute would be barred by the applicable statute of repose or limitations.

Each of the parties acknowledges that all non-public business, technical, proprietary or other similar information, including production cost and pricing information and data delivered to it by the other party in the course of entering into, performing or enforcing its rights under this Agreement, as well as the fact and terms of this Agreement, are confidential and shall be treated as confidential and agrees to, and to require its Affiliates, employees, legal, financial and other advisors to, hold such information in strict confidence and to refrain from disclosing or using such information to the detriment of the other party, until the fifth anniversary of the expiration or termination of this Agreement; provided however that a party may disclose confidential information:

 

if and when required to do so by Laws, provided that the disclosing party shall cooperate with any reasonable requests of the non-disclosing party in connection with a disclosure under this clause (a), including a request

 

to review any securities filings pertaining to the entering into of this Agreement prior to their filing;

to third parties in connection with a proposed sale by such party of its business related to the subject matter of this Agreement, or an interest therein, provided that such third parties agree in writing to keep such information confidential;

(c)  

   which was previously known to it at the time of disclosure as evidenced by pre-existing written materials;

(d)  

   which is received from a third party not under an obligation of confidentiality to the disclosing party with respect to such information as evidenced by pre-existing written materials; or

Each party agrees that if it breaches or threatens to breach Section 20.1 or any other confidentiality provision of this Agreement, the other party may be irreparably harmed and the remedy at law may be inadequate, and therefore, without limiting any other remedy available at law or in equity, an injunction, specific performance, or other forms of equitable relief to prevent further use and/or disclosure of confidential information, or money damages, shall be available to the other party.  All rights, powers and remedies provided for herein are cumulative, and the other party shall, in addition to the rights, powers and remedies herein conferred, be entitled to avail itself of all such other rights, powers and remedies as may now or hereafter exist.

Neither party shall make any announcement in any way concerning this Agreement nor any other transaction related hereto without the prior written consent of the other party hereto, except as may be required by Law or applicable stock exchange rule.

Orica and EDC hereby acknowledge that title to the AN manufactured for Orica hereunder shall at all times be in Orica.  Nevertheless, in order to protect Orica’s interest in such AN manufactured for Orica hereunder from the claims of creditors of EDC, EDC hereby assigns, pledges and grants to Orica a security interest in such AN manufactured for Orica hereunder.

Upon Orica’s request, EDC shall execute and file any financing and continuation statements prior to and from time to time after the manufacture of AN for Orica hereunder, as necessary to perfect such security interest, and EDC shall cooperate with Orica in connection with the execution and delivery of any notifications to any holders of conflicting security interests in such AN

 

manufactured for Orica hereunder to the extent such AN manufactured for Orica hereunder is considered or could be considered or is determined or could be determined to be the inventory of EDC in order to ensure the priority of Orica’s security interest.  Upon Orica’s request, EDC shall notify its creditors of Orica’s ownership and security interest in such AN manufactured for Orica hereunder, and shall request any such creditors to subordinate any liens or other security interests they may have in EDC’s assets to the security interest of Orica in such AN manufactured for Orica hereunder.

Orica agrees not to enforce its security interest unless a creditor of EDC asserts an interest in such AN manufactured for Orica hereunder or claims that all or part of such AN constitute the inventory of EDC.

Prior to entering into this Agreement, Orica has provided EDC with information regarding the safe transportation, handling, storage and use of Ammonia and AN (the “SHE Standards”).  EDC hereby acknowledges that it has received, read and understood the SHE Standards and agrees to take all such measures as are necessary or desirable in order to safely manufacture, transport, handle, store and/or use the Ammonia and AN in accordance with the SHE Standards.  For the avoidance of doubt, for the purposes of this clause, the term “the safe manufacture, transportation, handling, storage and use” of products relates not only to the safety of those persons who may be affected by the acts or omissions of EDC but also to protection of the Environment generally.

EDC shall comply with all safety and health Laws and Environmental Laws, regulations and codes of conduct applicable to the performance of its duties hereunder, and shall be solely responsible for any Claims howsoever arising in connection with any failure so to do.  EDC shall at all times remain responsible for the health and safety of those people affected by its operations and for protection of the Environment.

Unusual incidents (as identified in Schedule “E” hereto) at EDC’s Plant shall be reported to the Director, Sustainability of Orica USA Inc.  Such reports shall be made initially by telephone, to be followed by a written report within 24 hours.  If EDC inadvertently fails to promptly provide such notification or reports, such failure to notify or report shall not create any liability of EDC to Orica provided however that EDC shall rectify such failure as soon as it comes to EDC’s attention.

EDC shall indemnify, defend and save and hold harmless Orica and its Affiliates, and each of their respective officers, directors, employees, and agents (each, an “Orica Indemnified Party”), from and against any and all Claims sustained or incurred by any Orica Indemnified Party relating to or resulting or arising, directly or indirectly, from or in connection with, any of the following (provided that EDC

 

shall have no liability under this Section 22.4 for any Claims in respect of which Orica has agreed to indemnify EDC in accordance with Section 8.4 hereof, or to the extent such Claims relate to or result or arise from the negligent actions or inactions of an Orica Indemnified Party):

any breach of a representation or warranty made herein by EDC or non-compliance with or breach by EDC of any of the covenants or agreements contained in this Agreement to be performed by EDC;

the physical or environmental conditions at, on, under or in the EDC Site, and, to the extent such conditions are caused, created or contributed to by EDC, the physical or environmental conditions in the vicinity of the EDC Site;

the construction, equipping, maintenance, operation or use of the EDC Site, or the manufacturing or storage of Ammonia or AN, in each case in violation of any applicable Environmental Law or Environmental Permit;

the presence of any Hazardous Material or a Release or Disposal or the threat of a Release or Disposal of any Hazardous Material or waste on, at or from the EDC Site, or the Arrangement for Disposal or treatment of any Hazardous Material owned or possessed by EDC at any facility other than the EDC Site;

the failure to promptly undertake and diligently pursue to completion all necessary, appropriate and legally authorized investigative, containment, removal, clean up and other remedial actions with respect to a Release or the threat of a Release of any Hazardous Material on, at or from the EDC Site, required by any Environmental Law or Environmental Permit;

human exposure to any Hazardous Material, noises, vibrations or nuisances of whatever kind or death, personal injury or damage to property to the extent the same arise from the condition of the EDC Site or the construction, equipping, ownership, use, sale, maintenance, conveyance or operation thereof in violation of any Environmental Law; or

a violation or asserted violation of any applicable Environmental Law or Environmental Permit at or related to the EDC Site.

In addition to Orica’s indemnification obligations under Section 8.4 hereof, Orica shall indemnify, defend and save and hold harmless EDC and its Affiliates, and each of their respective officers, directors, employees, and agents (each, an “EDC Indemnified Party”), from and against any and all Claims sustained or incurred by any EDC Indemnified Party relating to or resulting or arising, directly or indirectly, from or in connection with, any of the following (provided that Orica shall have no liability under this Section 22.5 for any Claims to the extent such Claims relate to or result or arise from the negligent actions or inactions of an EDC Indemnified Party):

any breach of a representation or warranty made herein by Orica or non-compliance with or breach by Orica of any of the covenants or agreements contained in this Agreement to be performed by Orica;

the physical or environmental conditions at, on, or in the EDC Site to the extent such conditions are caused, created or contributed to by Orica;

human exposure to any Hazardous Material, noises, vibrations or nuisances of whatever kind, or death, personal injury or damage to property to the extent the same arise from the transportation and delivery of Ammonia supplied by Orica to the EDC Site and the shipment of AN by Orica or for Orica from the EDC Site or the rail cars or trucks supplied to the EDC Site by Orica; or

a violation or asserted violation by Orica of any applicable Environmental Law or other Law, or Environmental Permit or other permit, related to the transportation of Ammonia to and AN from the EDC Site or the rail cars or trucks supplied to the EDC Site by Orica.

All notices, requests, waivers, consents, approvals, agreements and other communications under this Agreement must be in writing to be effective and shall be delivered in person or by certified mail with postage prepaid and return receipt requested, courier or delivery service with charges prepaid or facsimile transmission,

and if to EDC, addressed as follows:

Either party shall have the right to change its address by notice to the other party at the addresses in force hereunder.

Any communications shall be deemed to have been received as follows:

if delivered in person, when delivered;

if forwarded by facsimile, on the date of transmission thereof as reflected on the confirmation of the transmitting machine;

if forwarded by certified mail, on the fifth Business Day following the date of mailing as shown on the certified mail receipt; and

if forwarded by courier or delivery service, on the third Business Day following the date of mailing as shown on the air bill.

The headings are inserted for convenience only and are to be ignored in construing this Agreement.

References to articles, sections or paragraphs are to articles, sections or paragraphs of this Agreement.  The words “hereto”, “herein”, “hereof”, “hereunder”, “this Agreement” and similar expressions mean and refer to this Agreement.

The singular includes the plural and vice versa, “person” includes any individual, firm, company, partnership, corporation, Government, instrumentality and unincorporated body of persons, or association; and “in writing” or “written” includes printing, typewriting, or any electronic means of communication capable of being visibly reproduced at the point of reception.

In the event that there shall be any discrepancies or conflict between the provisions of any Schedule attached to this Agreement and any of the provisions of the Agreement itself, then in every such event the provisions of this Agreement shall prevail and govern.

This Agreement shall be governed by and interpreted in accordance with the laws of the State of Colorado.

Neither party shall transfer, assign, convey or otherwise dispose of all or any portion of its interest in, or its rights, benefits or obligations under, this Agreement to a third party without first having obtained the prior written consent of the other party, such consent not to be unreasonably withheld, delayed or denied; provided, however, either party with prior notice to the other party shall be permitted to assign its rights and obligations under this Agreement to the successor of the assigning party as a result of a statutory merger or consolidation or to the purchaser of all or substantially all of such party’s assets, or to an Affiliate which has the capability (as determined by the non-assigning party in the exercise of its reasonable discretion) to perform the assigning party’s obligations hereunder (collectively a “Permitted Successor and Assign”).

An assignee must covenant in writing to fully assume and perform all of the assignor’s obligations under this Agreement.  No transfer or assignment shall discharge or relieve the assignor from any of its covenants or obligations as are contained or provided within this Agreement which arise, are incurred, or are to be performed, prior to the date of the transfer or assignment unless specifically agreed to in writing by the other party. From and after the effective date of any assignment of this Agreement, and the rights and obligations hereunder, which has been consented to in writing by the non-assigning party, the assigning party shall be deemed released from all obligations and liabilities hereunder which are

 

based on acts, omissions, facts, events or circumstances first arising, occurring or existing after the effective date of the assignment. The rights and obligations of the parties herein set forth shall inure to and be binding upon Permitted Successors and Assigns.

Notwithstanding the foregoing, in the event either party intends to sell or otherwise transfer all or substantially all of its assets to which this Agreement relates to a third party purchaser or other transferee, or transfer this Agreement to an Affiliate, the selling or transferring party shall, unless prohibited by confidentiality undertaking, notify the other party at least 60 days before the closing of such transaction.  The selling party shall also require its purchaser or transferee to assume the selling party’s rights and obligations under this Agreement upon the closing of such transaction.

 

27.5  Any purported transfer or assignment in contravention of the foregoing shall be null and void, shall be considered a material breach of the Agreement and shall permit the other party, in addition to any other rights which it may have, to terminate this Agreement upon giving 30 days written notice thereof.

Time shall be of the essence of this Agreement.

The provisions of this Agreement shall be binding upon the parties hereto and their respective successors and permitted assigns.

Nothing herein is intended to create a partnership for the purposes of subchapter K and Section 761 (a) of the Internal Revenue Code.

No waiver by either party of any breach hereof or of any claim, right or remedy provided for hereunder shall be deemed a waiver unless such waiver is in writing and signed by the party to be bound.  The failure of a party to assert or exercise any claim, right or remedy shall not be deemed a waiver of such claim, right or remedy in the future.

This Agreement may only be altered, modified, amended or changed by written agreement executed by both parties.

If any court or arbitrator declares the invalidity of any provision of this Agreement, such provision shall be either amended to make it valid or enforceable, respecting the intention of the parties expressed in that provision to the greatest

 

extent possible, or, if this is not possible, deleted with the remainder of the Agreement remaining in full force, validity and effect.

The parties hereto agree that the terms and provisions of this Agreement together with the Schedules hereto constitute the entire agreement between the parties hereto concerning the subject matter hereof and supersede any and all prior negotiations, understandings and agreements, whether written oral, between the parties with respect thereto.  There is no warranty, representation, collateral agreement or condition affecting this Agreement other than those herein set forth.

Purity (wt%)

99.5% NH3 Minimum

Nitrogen (wt%)

81.8% Minimum

Moisture (wt%)

0.2% Minimum to 0.5% Maximum

Oil

6 parts per million Maximum

Iron

1 part per million Maximum

Total Nitrogen (wt%)

34.0% Minimum

34.67%

Moisture (wt%)

0.15% Maximum

0.06%

Bulk Density

45.0 lbs/ft3 Minimum

47.7

Oil Absorption (wt%)

8.0 – 13.0%

10.4%

Internal Surfactant*

450 – 700 ppm (Winter)

650 – 1000 ppm (Summer)

550 ppm (Winter)

800 ppm (Summer)

 

External Surfactant*

 

600 - 1200 ppm (Winter)

800 – 1200 ppm (Summer)

 

807 ppm (Winter)

1000 ppm (Summer)

 

Talc (External Coating) (wt%)

 

0.4 – 0.75%

 

0.50%

Screen Analysis (U.S. Standard)

+6 Mesh (wt%)

0.0% Maximum

0.0%

+14 Mesh (wt%)

90.0% Minimum

98.1%

+20 Mesh (wt%)

10% Maximum

1.8%

-20 Mesh (wt%)

0.5% Maximum

0.1%

Total Nitrogen (wt%)

34.0% Min

34.5%

Water Insoluble

0.1% Max

0.01%

Moisture (wt%)

0.5% Max

0.3%

Bulk Density (Loose)

60 lbs/ft3 Min

61 lbs/ft3 Min

pH (10% w/w Solution)

5.5 to 6.5

6.0

E-2 Additive (%Mg)

0.18% - 0.40%

0.25%

Screen Analysis (U.S. Standard)

+6 Mesh (wt%)

2.0%

1.0%

+10 Mesh (wt%)

40.0% Min

45.0%

+14 Mesh (wt%)

75% Max

47.0%

+20 Mesh (wt%)

10% Max

7.0%

-20 Mesh (wt%)

1.0% Max

0.7%

AN Concentration (wt%)

85%-90%

pH Range

4.5 – 6

Loading Temperature

110 – 120 degrees C

·  

***

·  

***

·  

***

·  

***

1.  

***

2.  

***

3.  

***

4.  

***

5.  

***

6.  

***

7.  

***

8.  

***

·  

***

·  

***

·  

***

·  

Ammonia storage facilities when operated for Orica’s benefit;

·  

unusual shipping or handling services; and

·  

cessation or resumption of production under Section 4.3 of the Agreement which causes EDC to directly incur additional fixed or variable costs not otherwise included in the *** and in excess of amounts budgeted for the operation of the AN Prills Plant