AMENDMENT NUMBER THREE TO ENGINEERING, PROCUREMENT AND CONSTRUCTION SERVICES FIXED PRICE CONTRACT
EX-10.1 2 form8k_090409exh101.htm EXHIBIT 10.1 form8k_090409exh101.htm
AMENDMENT NUMBER THREE TO ENGINEERING, PROCUREMENT AND CONSTRUCTION SERVICES FIXED PRICE CONTRACT
Delta-T Corporation, a Virginia corporation (“Delta-T”) and NEDAK Ethanol, LLC, a Nebraska limited liability company (“NEDAK”) agree to amend the EPC Contract (as hereinafter defined).
AMENDMENT RECITALS
A. Delta-T and NEDAK entered into an Engineering, Procurement and Construction Services Fixed Price Contract dated August 9, 2006, and since that time have agreed to certain changes and amendments to such contract in documents alternatively entitled “Amendment,” “Contract Change Request,” “Letter of Commitment and Intent,” “Second Letter of Commitment and Intent,” together with other documents mutually reflecting the parties’ agreements to make changes to the original contract agreement. Collectively the original August 9, 2006 contract, including all agreed changes or alterations thereto as heretofore referenced shall be referred to as the “EPC Contract.”
B. In 2008, Bateman and Litwin NV (“Guarantor”) executed an agreement entitled “Guarantee” with regard to the prompt and complete performance by Delta-T of all of the terms and conditions of the EPC Contract.
C. Delta-T caused two separate letters of credit to be issued. The first letter of credit is designated #S1-1062-New York (“LOC 1062”) dated April 10, 2008. The second letter of credit is designated #S1-1067-New York (“LOC 1067”) originally issued May 9, 2008 in the amount of $5,500,000 million. The beneficiary of LOC 1062 was AgCountry Farm Credit Services, ACA (“AgCountry”). The beneficiary of LOC 1067 is NEDAK.
D. In April 2008, NEDAK executed a promissory note in the face amount of $5,000,000 in favor of Delta-T, secured by a Deed of Trust on NEDAK real property and improvements, which note has been amended and restated in October, 2008, and partially paid and/or reduced in the amount owed thereafter. Collectively such promissory note, all amendments thereto and payments and/or credits against such note shall be referred to as the “Promissory Note.”
E. NEDAK and Delta-T currently have a list of “punchlist” items of work attached hereto as Exhibit A. Certain punchlist items and work are separated from the complete and unabridged listing of punchlist work and shall be hereinafter referred to as “Excepted Punchlist Work” and delineated in Exhibit B hereto, which shall include certain presently existing urgent work, the record documents, and all work relating or pertaining to the CO2 scrubber, and RTO stack emissions issues.
F. In June 2009 AgCountry drew LOC 1062 and presently retains the net proceeds therefrom, in the amount of $3,995,000 (“LOC 1062 Net Proceeds”).
AMENDMENT NO. 3 - PAGE 1
G. On June 25, 2009, Delta-T commenced certain legal action against NEDAK and AgCountry in the District Court of Douglas County, Nebraska (the “Litigation”), and obtained a temporary restraining order in which the court temporarily restrained NEDAK and AgCountry from delivering any documents or taking other steps necessary to draw upon LOC 1067 (the “TRO”).
H. Prior to the events set forth in recital “G” above, NEDAK asserted liquidated damages against Delta-T (“NEDAK Liquidated Damages”).
I. NEDAK also believes that it possesses numerous claims and causes of action against Delta-T and Guarantor arising in contract, tort, and for asserted violations of various Nebraska statutes, which have accrued prior to the date of this Amendment No. 3 (collectively “NEDAK Claims”).
The parties hereto hereby agree that the EPC Contract shall be amended in the following respects, and the Litigation shall be resolved, all as hereinafter set forth.
1. Emissions Equipment.
(a) The plant emissions related equipment includes a CO2 scrubber and RTO stack (“Emissions Equipment,” see Exhibit B). The plant must meet the state of Nebraska Department of Environmental Quality (“NDEQ”) standards and specifications for various emissions, and as set forth in the air permit issued by NDEQ, including without limitation “HAP” and “VOC” (collectively “NDEQ Standards”). The parties agree to operate the plant in accordance with Delta-T operational procedures during all emissions testing.
(b) Delta-T and NEDAK shall promptly work cooperatively together to develop and implement changes, additions and/or alterations to the Emissions Equipment and operational procedures at the plant in order to meet the NDEQ Standards.
(c) Upon determination of an agreed upon plan of action, Delta-T shall promptly take any and all action necessary to make all design changes, alterations, modifications and/or additions to the plant Emissions Equipment in order to assure that all of the plant operations are in complete conformance with, and pass all NDEQ Standards and testing and meet all other criteria identified in Exhibit C within the time schedule set forth in Exhibit C hereto (hereinafter collectively “Remedial Emissions Work” Exhibit C hereto). Delta T shall be responsible for any and all costs associated with the Remedial Emissions Work including all testing of the emission work once it has been constructed.
2. Letter of Credit #S1-1067 of $5,500,000.
(a) Delta-T has caused the expiration date of LOC 1067 to be extended to no earlier than September 30, 2009 and in the amount of $5,500,000. Pursuant to this agreement, LOC 1067 shall be further extended as provided in paragraph 2(b) hereof.
AMENDMENT NO. 3 - PAGE 2
The parties have agreed on an interim basis to extend the hearing on the TRO to September 2, 2009
(b) Upon consummation and completion of the full execution of this agreement, on or before September 21, 2009, Delta-T shall cause LOC 1067 to be further extended to June 30, 2010 to provide complete security as set forth in this Amendment for timely completion of all Delta-T obligations undertaken in this amendment, including without limitation those relating to Emissions Work, Release of Delta-T Lien claims, and Warranty Work which initially shall be in the amount of $5,500,000 (“Extended LOC”). The Extended LOC shall meet the standards enumerated in paragraph 2(g). The failure by Delta-T to timely and fully obtain such extended LOC shall cause this entire Amendment No. 3 to become null and void, including without limitation that LOC 1067 shall have the same status as it did prior to the execution of this Amendment. The Extended LOC shall contain conditions to draw (“LOC 1067 Conditions”). The LOC 1067 Conditions shall be as hereinafter set forth in sections (c), (d), (e), (f) and (g), and shall be incorporated into the Extended LOC as conditions for drawing on such LOC.
(c) (i) The first condition under which LOC 1067 may be drawn by NEDAK is upon presentation of a certificate to the confirming bank that liens have been filed against the improved real property of NEDAK by Delta-T and/or any of its subcontractors, suppliers, equipment makers, materialmen, unions/pension trusts, professional services providers or any other person or entity claiming to have a lien against the property (hereinafter all collectively “Delta-T Lien Claims”) and ten (10) business days have elapsed since the delivery to Delta-T of notice of a Delta-T Lien Claim and Delta-T has not caused the lien to be extinguished and released, see subsection (d), below.
(ii) Notwithstanding subsection. (i) above, and subsection 2(d), on or before September 2, 2009, Delta-T shall hand deliver in recordable form an original fully executed partial lien release in the total amount of the final contract between Delta-T and Quality Plus Services, Inc. (“QPS”), less no more than $1,500,000. By way of example but not limitation, if the total Delta-T/QPS contract is $14,000,000, then the QPS partial lien release shall be for no less than $12,500,000 ($14,000,000 - $1,500,000 — $12,500,000). The failure by Delta-T to timely deliver the QPS Partial Lien Release to Delta-T shall, at NEDAK’s sole option, cause this entire Amendment to become null and void, including without limitation that LOC 1067 shall have the same status as it did prior to the execution of this Amendment.
(iii) Effective commencing with the execution of this amendment number three, and upon receipt of recorded full and final lien releases from Delta-T, the principal amount of the Extended LOC shall be reduced by NEDAK presenting to the confirming bank a certificate that “full and final lien releases” and/or recorded “full and final satisfaction” of any existing liens have been issued to its satisfaction, provided however, that in no event shall the face amount of the Extended LOC be reduced to an amount less than
AMENDMENT NO. 3 - PAGE 3
$3,500,000 or in accordance with paragraph 2(e) and Exhibit C.A.3., notwithstanding that the Delta-T lien releases may have exceeded $2,000,000.
(d) Delta-T shall obtain and record full and final lien releases and/or satisfaction of any Delta-T Lien Claims within ten (10) business days of any such lien being recorded against the NEDAK property. NEDAK shall provide Delta-T ten (10) business days notice of any failure by Delta-T to obtain full lien releases of any Delta-T Lien Claims, and Delta-T shall within such time period cause the lien to be extinguished and released. If Delta-T fails to timely obtain and record full and final lien releases of any Delta-T Lien Claims, NEDAK (or AgCountry as its assignee) shall be permitted to draw upon the Extended LOC to satisfy and/or otherwise pay actual lien claimants, upon presentation of the certificate to the confirming bank showing the amount of such liens unsatisfied as of that date, or a certificate stating that an action to foreclose a lien claiming damages (including interest, costs and fees) in an amount no less than the amount of the draw has been instituted.
(e) The second condition under which the Extended LOC may be drawn by NEDAK (or AgCountry as its assignee) arises from the failure of Delta-T to completely, promptly and timely perform all of its obligations taken under paragraph 1, “Emissions Equipment” of this amendment, and all related Exhibits thereto. NEDAK shall provide Delta-T notice of any failure by Delta-T to perform its obligations taken under paragraph 1. If Delta-T fails to correct such deficiencies within ten (10) business days from the date of receipt of such notice, NEDAK (or AgCountry as its assignee) shall have the right to draw upon the Extended LOC to complete all such work and/or successfully pass all such standards and tests, and the requirements set forth in Exhibit C, upon presentation of a certificate by NEDAK stating that Delta-T has failed to comply with its obligations with respect to Emissions Equipment and/or the Remedial Emissions Work, and stating the amount it reasonably believes is required to complete such Remedial Emissions Work, which amount shall be no less than the amount of the draw, provided however that if the nature and extent of the Remedial Emissions Work reasonably requires more time than ten (10) days to accomplish, and Delta-T commences such work within such 10-day period, then Delta-T shall have such greater time to complete the work as is reasonably required, but in no event longer than thirty (30) calendar days from the date of notice by NEDAK, provided however, unless necessary equipment has been promptly ordered by Delta-T but requires more than thirty (30) days for delivery. If, but only if, Delta-T both finally and completely satisfies all terms, conditions and deadlines set forth in subparagraphs (b), (c), (d) and this subparagraph (e), then NEDAK shall submit to the confirming bank of the Extended LOC a certificate that the face amount of the Extended LOC shall be reduced to $500,000.
(f) (i) The third condition under which NEDAK (or AgCountry as its assignee) may draw on the Extended LOC concerns warranty work. If the Extended LOC is reduced to $500,000 as provided in paragraph 2(e), the Extended LOC shall be extended in the face amount of $500,000. The Extended LOC shall remain in the face
AMENDMENT NO. 3 - PAGE 4
amount of $500,000 through June 30, 2010. The Extended LOC shall remain in force only through June 30, 2010 not withstanding that some warranties may still exist after such date. All Exhibit B designated punchlist work and Exhibit C emissions related work has a one-year warranty period from the date of final completion of all such work. NEDAK (or AgCountry as its assignee) may draw upon the Extended LOC during such one-year period to pay for the correction and/or replacement of all work and materials supplied by Delta-T prior to June 30, 2009, after notice and failure to cure by Delta-T in accordance with (ii) below (“Warranty Work”). Work and materials performed by Delta- T after June 30, 2009 shall also be included within the definition of Warranty Work which shall extend for one year for that specific Warranty Work from the date such work and materials have been provided and performed at the plant, but shall not be secured by the Extended LOC after June 30, 2010. NEDAK shall provide Delta-T notice of any Warranty Work required to be accomplished during such one-year periods, and Delta-T shall promptly take any and all action to correct such Warranty Work within ten (10) business days of receiving notice from NEDAK, provided however that if the nature and extent of the Warranty Work reasonably requires more time than ten (10) days to accomplish, and Delta-T commences such work within such 10-day period, then Delta-T shall have such greater time to complete the work as is reasonably required. If Delta-T fails to timely and properly perform the Warranty Work within the time period parameters after receipt of notice, NEDAK (or AgCountry as it assignee) shall have the right to draw upon the Extended LOC, upon the presentation of the certificate to the confirming bank stating that the Warranty Work has not been completed in an amount no less than the amount drawn.
(ii) Within ten (10) business days of the receipt of the notice set forth in subparagraph (i) above, Delta-T may deliver to NEDAK written notice of any objection that the NEDAK requested Warranty Work does not in fact properly constitute Warranty Work (“Warranty Dispute”). Failure by Delta-T to timely provide such notice shall constitute acceptance by Delta-T that such work properly constitutes Warranty Work. Within ten (10) business days of the Delta-T written notice of Warranty Dispute, the parties shall submit such dispute to the manufacturer of the equipment or parts asserted to be subject to warranty, who shall act as the decision maker of the Warranty Dispute (“Arbitrator”). If for any reason the Arbitrator is unable or unwilling promptly to act to resolve the Warranty Dispute, the Warranty Dispute shall promptly be submitted to a large manufacturer of a substantially similar piece of equipment or part, who shall act as Arbitrator. By way of example but not limitation, if XYZ Pump Manufacturer supplied a pump which was the subject of a Warranty Dispute, if XYZ Pump Manufacturer for any reason could not promptly act as arbitrator, the Warranty Dispute would be submitted to a large and substantial manufacturer of a substantially similar pump to act as Arbitrator. The parties hereto agree to exert their best efforts to assure that any Warranty Dispute shall be resolved within thirty (30) days of issuance of notice bringing the Warranty Dispute into existence.
AMENDMENT NO. 3 - PAGE 5
(g) At all times, without any gap, LOC 1067 or the Extended LOC shall remain in full force and effect until the earlier of the date on which the full face amount of LOC 1067 or the Extended LOC has been drawn, or June 30, 2010 and confirmed upon a bank organized under the laws of the United States or a state and acceptable to NEDAK, which such acceptance shall not be reasonably withheld if such confirming bank is insured by the Federal Deposit Insurance Corporation. In the event that at any time for any reason, the Extended LOC is not in full force and effect as provided in the preceding sentence, NEDAK (or AgCountry as its assignee) may draw the full remaining face amount of the Extended LOC and retain the proceeds thereof as security for the obligations of Delta-T hereunder. Such draw may be via an “extend or pay” demand pursuant to Rule 3.09 of the International Standby Practices, 1998, known as “ISP98,” published by the International Chamber of Commerce, which may be submitted at any time prior to the expiration of the Extended LOC as then in effect.
3. Punchlist Work, Liquidated Damages and NEDAK Claims.
Except as provided for in paragraph 6, NEDAK shall relieve Delta-T of all responsibility, including Warranty, for all punchlist work described in Exhibit A hereto, except for those punchlist work items designated as “Excepted Punchlist Work” set forth in Exhibit B. Delta-T shall have no further responsibility to complete punchlist work not enumerated in Exhibit B, and conversely shall have full responsibility to timely and properly complete all Exhibit B Excepted Punchlist Work. Except as provided in paragraph 6, Delta-T shall have no further responsibility or liability for any NEDAK Liquidated Damages which might otherwise have been asserted by NEDAK against Delta-T. Except as provided in paragraph 6, NEDAK fully and finally releases the NEDAK Claims.
4. LOC 1062 Proceeds.
At the present time AgCountry possesses the LOC 1062 Net Proceeds, and either it or NEDAK maintain such possession. Delta-T shall have no further right, title or interest in any LOC 1062 Net Proceeds, except as provided in paragraph 6.
5. Promissory Note.
All parties hereto agree that the Promissory Note shall be extinguished and of no further force and effect, except as provided in paragraph 6. Within five (5) business days of execution of this Amendment No. 3, Delta-T shall take all appropriate action and shall execute all required documents reasonably necessary to complete and record a full reconveyance and/or cancellation of any deed of trust or other security instrument currently recorded against the real property and improvements of NEDAK.
AMENDMENT NO. 3 - PAGE 6
6. The Litigation and TRO.
(a) As part of the execution of this amendatory agreement, Delta-T shall promptly dismiss, partially with prejudice and partially without prejudice and without costs the Litigation and to dissolve the TRO, in form identical to Exhibit D attached hereto.
(b) Punchlist Work, NEDAK Liquidated Damages, NEDAK Claims, LOC 1062 proceeds, and the Promissory Note referenced in paragraphs 3, 4 and 5 of this amendatory agreement, and any Delta-T claim that NEDAK improperly or prematurely drew upon the Extended LOC, are hereby collectively defined as “New Causes of Action.” If, subsequent to the execution of this Amendment No. 3, either NEDAK or Delta-T commence any future action against the other party which asserts that the other party has violated any of the terms and conditions of this Amendment No. 3, any party may assert its own New Causes of Action against the other party in such dispute resolution process. If the fact finder finds in favor of any party arising from any such New Causes of Action, the fact finder may assess any damages or award it deems appropriate, notwithstanding any of the agreements, concessions, releases or compromises set forth in paragraphs 3, 4 and 5 of this amendatory agreement.
7. No Further Payments.
Except as specifically provided for herein, no further payments or transfers of funds shall be made by, to or from Delta-T and NEDAK.
8. Notice.
The purposes of this amendatory agreement, notice shall be deemed sufficient if provided to the following persons and/or entities by facsimile, email, hand delivery, or any form of express delivery:
To: Delta-T Corporation
Attn: Thomas R. McDaniel
323 Alexander Lee Parkway
Williamsburg, VA 23185
tmcdaniel@deltatcorp.com
And to: Richard Jeffries
Cline, Williams, Wright, Johnson & Oldfather, L.L.P.
One Pacific Place
1125 South 103rd Street, Suite 320
Omaha, NE 68124
rickjeffries@clinewilliams.com
AMENDMENT NO. 3 - PAGE 7
To: NEDAK Ethanol LLC
Attn: Jerome Fagerland
87590 Hillcrest Road
Atkinson, NE 68713
***@***
And to: David W. Schiffrin
Schiffrin Olson Schlemlein & Hopkins, P.L.L.C.
1601 Fifth Avenue, Suite 2500
Seattle, WA 98101
dws@soslaw.com
9. Counterpart Signatures.
Each representative executing this agreement warrants and represents to all other parties that they possess full authorization and rights to execute this amendatory agreement on behalf the party they represent. This amendatory agreement may be executed in counterpart.
10. Limited Amendment.
Except as specifically set forth herein and modified or amended, all terms and conditions of the EPC Contract shall remain in full force and effect.
11. Notice to AgCountry.
NEDAK warrants and represents that AgCountry has been informed of and provided a copy of this settlement agreement and has raised no written objections or protests to the terms and conditions of this amendment.
12. Notice to Bateman.
Delta-T warrants and represents that Bateman has been informed of and provided a copy of this settlement agreement and has raised no objections or protests to the terms and conditions of this amendment.
| DELTA-T CORPORATION | NEDAK ETHANOL, LLC | |||
| /s/ T.R. McDaniel T.R. McDaniel | /s/ Jerome Fagerland Jerome Fagerland | |||
| Its: President | Its: President | |||
| | |
AMENDMENT NO. 3 - PAGE 8
NEDAK INTEGRATED PUNCH LIST
| List # | Area | DTC Tag # / P&ID | Description | Comments | Confirmed Complete | Action | Nedak Cost Estimate | Delta T Cost Estimate | |
| 3 | Boiler | Boiler | RO & Soft water piping is carbon steel, however, it should be stainless steel or PVC for corrosion protection. | Change Order #8 Jeff will finalize numbers. Jeff provided Change Order proposal for $20,174. Nedak requesting clarification that all work is included. Nedak is considering having piping installed as agreed to by C.O. #8. Nedak will advise. | Adjusted CO submitted | Complete | CO pending | CO pending | |
| 4 | Boiler | Boiler | RO permeate piping, tanks, and pumps need to be corrosion resistant, not carbon steel as shown on PI-7301. | Change Order #8 Included with Item # 3. | Adjusted CO submitted | Complete | CO Pending | CO Pending | |
| 17 | PI-3103 | PI-3103 | Repair Ferm Building siding that is damaged. This is to include all damaged siding for all buildings. | Chris taking pictures of damaged siding and broken doors Jeff Derby says that if there is damaged siding they will repair it | Complete | $ 6,000 | $ 6,000 | ||
| 20 | Grains | Grains | BH 445 - No way to get to the top to inspect-grease-repair motor, belt drive, fan bearings, or fan. Install small access type platform constructed off of the adjacent stairway to allow maintenance. | Matt Mills did a drawing for this platform. The last response from DTC was that the steel was on order and that it would be installed after start-up and that it would be bolt up to prevent from having to weld. DTC suggested that JLG or forklift with manbasket could work. Nedak was not receptive due to the frequent inspection and maintenance requirements per O&M Manual. DTC will go back to Bratney for access platform. Price for platform is $13,000. Delta-T to resolve with Bratney by 3.27.09 Delta-T agreed to provide platform. Resolved pending installation of platform. | Disputed by Nedak | Wanzak/QPS Handrail & Ladder, Consider grating | $ 5,000 | $ 5,000 |
EXHIBIT A
Page 1of 17
NEDAK INTEGRATED PUNCH LIST
| 61 | Grains DDG | PI-7701 | no guards over the chain and gears on the door drive. | Guards have not been installed. Bratney says that it is Overhead Doors responsibility. Overhead Doors says it's not in their scope of work. Previous DTC manager planned to do. DTC will install guards. Resolved pending completion. | Disputed by Nedak | Complete, Delta T to try to get OSHA Regulation reference | $ 500 | $ 500 | |
| 135 | Ethanol Storage | Safe access to alcohol storage tanks; Need to install walkway to get from the top of the Alcohol storage area to the bottom of the alcohol storage area. | Walkway has not been completed. Supports installed but the rest of the work has not been completed. See Bob P. drawing for walkway | Disputed by Nedak | Complete; Nedak expressed a concern for slipping on supplied access panels | $ 5,000 | $ 5,000 | ||
| 141 | General | Bolts and Nuts - Need to have correct bolts and nuts installed | NEDAK is in the process of taking pictures and documenting which nut and bolts need to be changed for DTC; Wanzak to survey entire site, flag, and then repair.In Progress | Resolved pending completion | Complete; Nedak to provide Delta T with a proposed Bill of Matreial for spare bolts & nuts to be supplied to Nedak | $ 1,000 | $ 1,000 | ||
| 751 | General | General | Furnish outstanding Vendor Training | Still need RTO , Dryer, and Chiller training | Disputed by Nedak; Need additional RTO/Dryer/ Chiller training | Complete | $ 12,000 | $ 12,000 | |
| 861 | Cooling Tower | Investigate and disposition discharge valves that are cracked. | DTC does not plan to replace defective valves. David hughes will investigate. Valve supplier is not concerned. Delta-t will provide one spare valve and letter from supplier. Resolve pending receipt of letter and valve. | Disputed by Nedak | Complete | $ 5,000 | $ 5,000 | ||
| 892 | General | Close openings in buildings around pipe, conduit, cable tray, conveyors, etc | Buildings need to be closed to prevent freezing problems in the winter and to reduce bird and rodent problems 4 men / 30 days | Complete | $ 15,000 | $ 15,000 |
EXHIBIT A
Page 2of 17
NEDAK INTEGRATED PUNCH LIST
| 946 | Centrifuges | extend end of wet cake conveyor under centrifuges; DC-600 kicks out when running higher rates with the flow spread out evenly across all centrifuges | This item was previous agreed to by Don C. and Jeff Derby . Parts were previously stated to be ordered. DTC is investigating extension of conveyor (moving cable tray) or providing replacement tail section for conveyor. Nedak stated either approach would be acceptable. Delta-T has offered a new spare tail section. Nedak needs to send DTC email stating acceptance. Resolved pending receipt of tail section.. | Disputed by NEDAK | Order - on Hold Tail section | $ 45,000 | $ 45,000 | ||
| 1075 | Platform for boiler make up air system | Previously agreed to by Nedak and Don Cain that there would be concrete poured and a portable ladder bought instead of installing a steel platform. DTC will include concrete if change order for containment concrete is issued. DTC will not provide portable stairs. Nedak will review. Include with concrete change order work. Resolved when Change Order is resolved. | Previously Agreed | Plan to extend concrete | $ 5,000 | $ 5,000 | |||
| 1200 | RTO MCC | Install rain culvert berm to drain away from MCC south wall | Build berm Need info from Don Cain | Disputed by NEDAK | Complete; previously noted as completed (meeting of 6/24); recent rainstorm caused water to rise into MCC room floor but below switchgear mounting pad | $ 2,000 | $ 2,000 |
EXHIBIT A
Page 3of 17
NEDAK INTEGRATED PUNCH LIST
| 1201 | DD&E | The lockset is missing from the east MCC room door (DD&E MCC) | On order | Resolved Pending Completion | Delta T proposes to supply 10 door handles, and 10 door closers to Nedak | $ 3,000 | $ 3,000 | ||
| 1208 | Site wide | Install bollards around high volt vaults | HOLD FOR FINAL COUNT | Complete | $ 4,000 | $ 4,000 | |||
| 1259 | Add french drain for main process and dryer XFMR yards | Schedule after ground thaws | Disputed by Nedak | Complete; Nedak has concerns with RTO French Drain | $ 1,000 | $ 1,000 | |||
| 1375 | Permanently electric trace and insulate the level transmitters on the evaporators | QPS to add updates to I&I drawings; In Process | Complete; Nedak needs redline drawings | $ 200 | $ 200 | QPS | |||
| 1376 | Permanently electric trace and insulate the dp transmitter on the CO2 Scrubber | QPS to add updates to I&I drawings; In Process | Complete; Nedak needs redline drawings | $ 200 | $ 200 | QPS | |||
| 1404 | Boilerhouse | The equipment has not been installed as designed by Delta-T engineer (Matt Mills) to meet permit requirements for ph and temp control. Complete outfall system per design | Water blowdown needs to be below 90 deg F | Disputed by Delta T | Delta T requests copy of Permit specifying discharge temperature | $ 5,000 | $ 5,000 | ||
| 1418 | BOP | Wholestillage agitator is undersized for the size of the tank. This is evident with the buildup of solids in the bottom. | CIP entering whole stillage upsets centrifuges | Disputed by Delta T | Delta T requests documentation illustrating upsets | $ 15,000 | $ 15,000 | ||
| 1444 | 2nd floor by the main fan discharge duct on the east side is a step thru hazard | Disputed by Nedak | Complete; Not Complete - opening around kickplate | $ 200 | $ 200 | QPS | |||
| 1446 | Dryer | 2nd - floor inspection door incased with insulation and siding - will be a cut issue | Which area? More Specific, NEDAK respond | $ 500 | $ 500 | INI | |||
| 1448 | Homemade bolts on packing glands on screws | Top of Dryer Cyclones | Disputed by Delta T | $ 300 | $ 300 | ||||
| 1501 | Boilerhouse | Boilers failed boiler inspection- Fix required before 30 days are up | Pressure switch has been istalled but dose not work. Jumpers are still on the boilers 3-10-09; The Makeup Air Unit in the boiler house was adjusted and the jumpers removed; Operating Manual delivered | Move Thermostat & verify Pressure Switch | $ 3,000 | $ 3,000 | QPS |
EXHIBIT A
Page 4of 17
NEDAK INTEGRATED PUNCH LIST
| 1502 | Grains | Grain Bin discharge drag needs to be replaced. All of the paddles have been bent twice. | DTC states it is still working, no need to replace. DTC will investigate replacement of chain with bent flights. Chain is now showing wear. Delta-T will have Bratney review and Delta-T has agreed to replace chain. Resolved pending delivery of new chain. | Resolved pending delivery of chain | $ 27,000 | $ 27,000 | |||
| 1514 | Main Process | Vent fan has been run into and dented | Replace Hood? | Team Walkthru - Penetrations & Dents | $ 1,000 | $ 1,000 | |||
| 1523 | DDGS Building | Heater in Fire System Room for DDGS needs looked at. It has put a black stain on the wall | Complete | $ 100 | $ 100 | ||||
| 1531 | Plant | Check Agitator Upper Bearings for Temperature; Agitators - need official lubrication SOP | Use Heat Gun to check the upper bearings. Bearings are supposed to be fully sealed and packed for life.; Bearing Temperatures have been monitored - no increase in temperature. | Pursue reason why grease fittings on replacement for Agitator on Ferm 1 | $ 1,000 | $ 1,000 | |||
| 1539 | Grain Handling | Corn Bin Sweeps - shafts breaking | Jerry & Cliff | $ 500 | $ 500 | ||||
| 1546 | Main Process | Flat bottom plastic tanks with no agitators for the enzymes presents problems with emptying contents, hot cip, and keeping enzymes from stratifying. | Delta-T added recirculation to the tank to help with preventing stratification. Other issues were not addressed and deferred to determine if operational problems develop. Put on Punch List as reminder. | Disputed by Nedak | Complete CHA E-mail of 6/3 | $ 60,000 | $ 60,000 | ||
| 1547 | Main Process | Install platform on top of TK-2201 for agitator repair work with a trolley beam to replace equipment. | With the known agitator failures at other plants and the recent agitator failure at Nedak, this issue needs to be addressed. | Disputed by Delta T | $ 3,000 | $ 3,000 | |||
| 1548 | Plant | Need to order some confine space signs to replace the ones removed from the tanks from the many insulation changes | $ 200 | $ 200 | |||||
| 1576 | PC 7201 power head is leaking oil | Need Parts | $ 1,000 | $ 1,000 |
EXHIBIT A
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NEDAK INTEGRATED PUNCH LIST
| 1584 | Seal Roof Above Control Room for leaks | Reference CHA E-mail of 5/31 | Disputed by Nedak | Complete | $ 1,500 | $ 1,500 | |||
| 1587 | Need a chain actuator for V31205 3” yeast prop to ferm | $ 300 | $ 300 | ||||||
| 1588 | 6” butterfly syrup valve to dryer needs valve plate to hold handle in place | On Order | $ 100 | $ 100 | |||||
| 1589 | Explosion door replacement / repair for door that was sucked in on the flour leg | On Order | $ 500 | $ 500 | |||||
| 1590 | The grating on the top of the tanks | Skid Strips installed | Disputed by Delta T | Complete, Nedak to review | $ 1,000 | $ 100 | |||
| 1591 | CIP line to top of Ferm 3 missing a support | check with Jerry on resolution | Disputed by Delta T | Complete | $ 500 | $ 500 | |||
| 1601 | The inside of Main Process needs to be finished. As in the 1st 10-12 foot of wall needs to have metal siding to prevent the insulation from being torn or messed up from spraying material (water, mash, acid, caustic) | Consider White Vinyl Tape for repairs | Disputed by Nedak | Complete | $ 200 | $ 200 | |||
| 1602 | The inside of the MCC rooms needs to be finished out they are only roughly installed | Northeast Corner of MP MCC has sheetrock not installed | Disputed by Delta T | $ 200 | $ 200 | ||||
| 1605 | The water that blows out the top of the CO2 scrubber has not been addressed yet. | $ 300,000 | $ 10,000 | ||||||
| 1608 | The speed switch low SSL-632 on DC-632 is not installed correctly. The encoder disk is attached to the tail shaft and then moves horizontally when the chain tension is adjusted on the tail shaft. The receiver is permanently fixed. ERGO when you adjust tension on the belt the speed switch low sensor stops working . | Work in Progress | $ 500 | $ 500 | |||||
| 1611 | Dryer Maxon valve - 640 Maxon valve needs to be cleaned to operate reliably, appears to be hanging up due to dirt | Mfg indicates the valve stem is self cleaning. Stroke several times to clean shaft. | Still Sticking - needs replacement | $ 2,000 | $ 2,000 | ||||
| 1612 | Sensing line at the dryer burner has heat tape without insulation - please add that all heat tape to be covered with insulation | Complete | $ 500 | $ 500 |
EXHIBIT A
Page 6of 17
NEDAK INTEGRATED PUNCH LIST
| 1613 | Cooling Tower blowdown valve appears to be undersized - the existing control valve has been at 100% open for 24 hours and has not been able to control the conductivity to the set point. | Under Investigation; Temperature of Outfall | Disputed by Delta T | Ted sent Cliff email on 6.15.09 for sizing criteria | $ 4,000 | $ 4,000 | |||
| 1614 | Dryer quench water drain - the drain line off the bottom of the hot box was thought to be temporary. If this is a permanent line, the quench water needs to be collected and sent to the waste water tank. | Under Investigation | Disputed by Delta T | Quantity of water discharged from this connection can be controlled and evaporated, worst case | $ 25,000 | $ 2,000 | |||
| 1614 | Dryer steam header condensate - The condensate drain valve needs to be closed. Condensate Return Line subject to freezing. | Under Investigation | Disputed by Delta T | ||||||
| 1615 | PI-132 and PI-133 are damaged on the RTO burner manifold. The installed gauges are Miljoco brand that are both currently 0-60 inches H20. The data book calls for them to be 0-5 PSI, and 0-60 PSI | JK E-mail of 6/9 | On Order, to be shipped to site. Nedak to provide additional two instruments to DT for Nestec to supply | $ 300 | $ 300 | ||||
| 2000 | CO2 Scrubber | PI-3201 | PI 32104 & 32105 have wrong range - gauges are psi, should be inches of water. | Quote $63.60 each | $ 200 | $ 200 | |||
| 2002 | DDE | PI-4101 | Z-4103 broken site glasses | $ 500 | $ 500 | ||||
| 2003 | Corn Dust collection system - dust to wrong conveyors; Reroute grain bin dust collection out of grain bins to keep bins from plugging. – Sept. 9, 2007 | Disputed by Delta T | $ 60,000 | $ 60,000 | |||||
| 2007 | RTO | West RTO poppet valve air leaking | One assembly appears to be leaking | $ 500 | $ 500 | ||||
| 2008 | Dryer | Insulate all electric heat tracing - PT-52121,52122, 52123, 52124, 52111, 52114, 52166, actuator in duct to hotbox, others | Complete | $ 4,000 | $ 4,000 | ||||
| 2010 | Dryer | Install cover plate on LB fitting below dryer burner control panel | $ 50 | $ 50 | |||||
| 2012 | Boiler | Exterior lights on west side and south side of boiler building on during day time - install/replace sensor | Lights are manually operated per drawings; Circuit breaker 5&7 | Disputed by Delta T | Complete; Consider installation of photocell. | $ 500 | $ 500 |
EXHIBIT A
Page 7of 17
NEDAK INTEGRATED PUNCH LIST
| 2013 | Site | Total Site Cleanup - misc. piles of debri throughout site, fuel storage tanks need to be removed. Need to start at top of each structure and work down. | $ 5,000 | $ 5,000 | |||||
| 2014 | Tank Farm | Ethanol storage tank farm dike drain valve is leaking | Complete; Nedak in process of testing | $ 5,000 | $ 500 | ||||
| 2015 | Dryer | FLXS-14 at outlet of recirc fan has tear on north side. | $ 1,000 | $ 1,000 | INI | ||||
| 2016 | Dryer | Several ports on ductwork covered by insulation. Locations are marked on drawings in the control room and general location marked in the field with red marker. Make access port in the insulation. | Disputed by Delta T | INI to check with Jerry | $ 2,000 | $ 2,000 | |||
| 2017 | Dryer | Structural steel with monorail above vent panels is not installed per drawing 52261-SS-5206. Structural steel above vent panels at elevation 83 is not installed. | Disputed by Delta T | $ 30,000 | $ 30,000 | ||||
| 2019 | CIP | PI-7602 | CIP heater gasket has been replaced several times - need proper gasket material | Gaskets delivered to Nedak | $ 500 | $ 500 | |||
| 2020 | Shaft guard needed on DC-610 and others with exposed shafts - see Perry | Disputed by Delta T | QPS to get with Perry | $ 3,000 | $ 3,000 | ||||
| 2021 | Dryer | Dryer combustion air duct has plastic plug in bottom of duct, needs to be metal to match duct due to temperatures exceeding 120F | $ 100 | $ 100 | |||||
| 2022 | CO2 Scrubber | Provide installation of permanent chemical injection system for CO2 scrubber. | Mechanically Complete | Siemens Programming Required; Mechanically complete | $ 5,000 | $ 5,000 | |||
| 2023 | Centrifuges | PI-5101 | V51120 is missing to drain level gauge | $24.00 each | Complete | $ 300 | $ 300 |
EXHIBIT A
Page 8of 17
NEDAK INTEGRATED PUNCH LIST
| 2024 | Conveyors | DC-635 is having plugging and overload problems. Conveyor appears to be undersized. Need resolution. | Disputed by Delta T | $ 45,000 | $ 45,000 | ||||
| 2025 | Dryer | Gas meter to the dryer is reading low by factor of almost 3. Dryer and RTO gas flow meters are not tagged and are not shown on Rev. 5 of P&ID | Calibration Issue; Siemens | $ 300 | $ 300 | ||||
| 2027 | Ferm #1 | Ferm #1 has API 650 nameplate replace with appropriate tag | Line Items 2027, 2028 and 2029 have been valued at $300 per tank for eight tanks | Ask O'Donnell for guidance on tagging | $ 800 | $ 800 | |||
| 2028 | Ferm #2 | Ferm #2 does not have nameplate. Install appropriate nameplate. Address Alcohol Tanks as well. | Line Items 2027, 2028 and 2029 have been valued at $300 per tank for eight tanks | Ask O'Donnell for guidance on tagging | $ 800 | $ 800 | |||
| 2029 | Beerwell | Beerwell does not have nameplate. Install appropriate nameplate. | Line Items 2027, 2028 and 2029 have been valued at $300 per tank for eight tanks | Ask O'Donnell for guidance on tagging | $ 800 | $ 800 | |||
| 2031 | Mole Sieves | PI-4201 | Fusel oil separator VS4204 needs temporary insulation replaced with permanent insulation | Complete | $ 500 | $ 500 | |||
| 2032 | Mole Sieves | PI-4301 | Replace PI-43103, also insulate over exposed electric heat tape. | $ 200 | $ 200 | ||||
| 2033 | Mole Sieves | PI-4301 | PSV43183 has all thread on discharge flange | $ 100 | $ 100 | ||||
| 2034 | Process water lines and RO water lines need sweat protection insulation. | Not in Project Scope | Disputed by Delta T | $ 2,000 | $ 1,000 | ||||
| 2035 | Dryer | RV5204 motion switch needs resupport to miss from rubbing on G204beam | Complete | $ 100 | $ 100 | QPS | |||
| 2036 | Dryer | PT52125 line sensing thermostat is sensing air temperature not line temperature | To be checked | In Progress | $ 100 | $ 100 | |||
| 2037 | Dryer | Chains at top of several ladders need positive clip, not just hooks | $ 500 | $ 500 | |||||
| 2038 | Dryer | Need chain across stairs with sign "Do not enter while dryer is operating" to prevent access to level 59 | $ 150 | $ 150 |
EXHIBIT A
Page 9of 17
NEDAK INTEGRATED PUNCH LIST
| 2039 | Dryer | Replace/relocate removable insulation blanket on the bottom of X-5209 conveyor | In Progress | $ 100 | $ 100 | ||||
| 2040 | Dryer | Repair/replace insulation at steam line connection to header for syrup line to X-5215. | Complete | $ 100 | $ 100 | ||||
| 2041 | Dryer | Replace shaft guard to fan FN-5202 | Complete | $ 100 | $ 100 | ||||
| 2042 | Dryer | Steam vapors from DC-615 accumualte in DC-635 and condense and run down DC-635 and drip out the bottom. Need to isolate DC-615 from DC-635 to avoid this drainage in the summer and to avoid freeze up in the winter. | Slide Gate is acceptable solution | Disputed by Delta T | $ 2,000 | $ 2,000 | |||
| 2044 | MP Bldg | PI-2101 | Air regulator at PC-2101 needs better support | $ 100 | $ 100 | ||||
| 2046 | MP Bldg | PI-2101 | Y-2101 needs support revision - see Ken Prothman for solution | Disputed by Delta T | Investigate, Supports on top of tank 2101 | $ 100 | $ 100 | ||
| 2047 | MP Bldg | Ken | Mandoor from MP to CO2 scrubber is missing handle and latch | $ 400 | $ 400 | ||||
| 2048 | MP Bldg | Ken | Southwest overhead door doesn't close completely | Complete | $ 500 | $ 500 | |||
| 2049 | MP Bldg | Ken | Seal or insulate walls at door on north end of Ferm Alley | Close up the building | Disputed by Delta T | $ 300 | $ 300 | ||
| 2050 | MP Bldg | Ken | Remove left over electric strut pad behind PC-3110 CIP pump on floor | Complete | $ 100 | $ 100 | |||
| 2051 | MP Bldg | Ken | Replace cracked CWR line valve for seal pot on PC-3110 | Complete | $ 200 | $ 200 | |||
| 2052 | MP Bldg | Ken | Seal on input shaft of pump power head on beerwell pump PC-3108 | $ 500 | $ 500 | ||||
| 2053 | MP Bldg | Ken | Water from hole in top of BL-3202 is putting water on the motor | Housing Rusting Out | $ 100 | $ 100 | |||
| 2054 | MP Bldg | Ken | Inlet line on steam skid Z-7601 is leaking | $ 100 | $ 100 | ||||
| 2055 | MP Bldg | Ken | Insulation needed at several spots in Northeast corner of MP bldg by PC-7603 | Nedak to review and provide additional detail | Disputed by Delta T | $ 500 | $ 500 | ||
| 2057 | MP Bldg | Ken | Need insulation on E-7602 dilute caustic heater | Complete | $ 200 | $ 200 | |||
| 2058 | MP Bldg | Ken | PC-7601 Process Condensate Pump seal on input shaft of power head is bad | $ 300 | $ 300 |
EXHIBIT A
Page 10of 17
NEDAK INTEGRATED PUNCH LIST
| 2059 | MP Bldg | Ken | Pipe support is loose on steam condensate line back of Z-7601 | Complete | $ 100 | $ 100 | |||
| 2060 | MP Bldg | Ken | Replace PI-76281 and 76282 at CIP strainer | $ 200 | $ 200 | ||||
| 2063 | MP Bldg | Ken | Yeast mix tank agitator shaft wobbles more than expected. | Disputed by Delta T | $ 4,000 | $ 4,000 | |||
| 2064 | MP Bldg | Ken | Only using 400 cfm of AC-7503 with rest venting to atmosphere creating noise issue and wasting energy - incorrect design of compressor capacity | Extend pipe outside; consider muffler | $ 1,000 | ||||
| 2067 | Ken | Repair chain for main steam valve to MP Bldg in pipe rack. | Complete | $ 100 | $ 100 | ||||
| 2068 | Ken | Need handle on steam condensate line valve in pipe rack where rack splits and goes to boiler house | Complete | $ 50 | $ 50 | ||||
| 2070 | DDE | Ken | Bolts on suction side of PC-4101B are loose | Complete | $ 50 | $ 50 | |||
| 2071 | DDE | Ken | Need additional support for 3" line from rectifier bottom to beer feed up and behind PC-4101A | Complete | $ 200 | $ 200 | |||
| 2072 | DDE | Ken | Replace block of wood with pipe support at Z-4103 | Complete | $ 200 | $ 200 | |||
| 2073 | DDE | Ken | Repair leaks on Z-4103 | $ 100 | $ 100 | ||||
| 2074 | DDE | Ken | Replace pressure gauge on discharge of PC-7103 | $ 100 | $ 100 | ||||
| 2075 | DDE | Ken | Shower on lower floor of DDE does not flow enough water | Possibly clogged; Nedak to flowtest | Disputed by Delta T | $ 100 | $ 100 | ||
| 2076 | DDE | Ken | Replace PI-45247 and TI-45248 on E-4505 evap cooler | $ 200 | $ 200 | ||||
| 2077 | DDE | Ken | Need pressure stablizers to reduce vibration on PI-43156 and PI-43155 on regen filter lines by PC-4303 | Investigate, consider snubber | $ 200 | $ 200 | |||
| 2078 | DDE | Ken | Provide recirc line from PC-4401 to C-4401 to prevent the pump from deadheading | Not specifed in contract scope | Disputed by Delta T | Nedak to review control system | $ 500 | $ 500 | |
| 2079 | Cooling Tower | Ken | Suction pipe is not supported for PC-7101A&B, need to readjust the supports | $ 100 | $ 100 | ||||
| 2082 | Ken | Bolts are loose on the corrosion inhibitor tank electric panel | Complete | $ 50 | $ 50 |
EXHIBIT A
Page 11of 17
NEDAK INTEGRATED PUNCH LIST
| 2084 | Ken | Replace TI-42166 on CO2 line on reflux vent condenser E-4203 | $67.65 each | $ 100 | $ 100 | ||||
| 2085 | Boilers | Ken | Need pipe support on condensate line on east wall | Complete | $ 200 | $ 200 | |||
| 2089 | Ken | Plug leaking on east \end of Z-7302 RO skid | $ 100 | $ 100 | |||||
| 2090 | Ken | Repair oil leaks on top of hammermills at valves and lines | Disputed by Delta T | Investigate | $ 400 | $ 400 | |||
| 2091 | Ken | Replace missing paddles on DC-610 conveyor | Nedak to estimate quantity | $ 1,000 | $ 1,000 | ||||
| 2092 | Replace gear box on DC-605 - still need drive hub for input shaft pulley | All components received and delivered to Nedak | Complete | $ 200 | $ 200 | ||||
| 2093 | Dryer | DC-635 Gearbox support needs additional support | $ 500 | $ 500 | |||||
| 2094 | Dryer | Dryer Stack test ports are too small (only two inches) and one is not plugged or capped. Ports need to be 4". | Test Ports not required | Disputed by Delta T | $ 400 | $ 400 | |||
| 2095 | Dryer | Cyclone rotary valves RV-5202 and RV5203 are installed differently and extremely hard to access. One is installed 90 degrees out of normal position. | Disputed by Delta T | $ 1,000 | $ 1,000 | ||||
| 2096 | Dryer | Missing handles on supply manifold for PT-52112, 52135, 52111, 52171, 52121, 52122 | Complete | $ 400 | $ 400 | ||||
| 2097 | Dryer | SSL-X5215 flex is a trip hazard. Needs rerouted or protected | $ 200 | $ 200 | |||||
| 2098 | Dryer | CY12-11 ductwork supports are tack welded on to structural steel. “Cyclone to precipitator” Should these be bolted. | $ 400 | $ 400 | |||||
| 2099 | Gas meter to flare is not working | $ 1,000 | $ 1,000 |
EXHIBIT A
Page 12of 17
NEDAK INTEGRATED PUNCH LIST
| 2100 | #23 Install stairs and walkways across the top of the ferms and beerwell. –Sept 9, 2007 Delta-T response was that none of their plants have this | Not in project scope | Disputed by Delta T | Please refer to EPC contract Exhibit A, Section 2, under General where it states the following: "Delta-T will provide access to equipment in accordance with sound engineering and safety practices, including catwalks, platforms and stairs in the Main Process Building for access to the "major" tanks and equipment". - Would not the fermenters and beer well fall into this category? | $ 75,000 | $ 75,000 | |||
| 2101 | #25 Reroute grain bin dust collection out of grain bins to keep bins from plugging. – Sept. 9, 2007 | Disputed by Delta T | $ - | QPS | |||||
| 2102 | #48 Walkway under grain Bins : There is always water standing in the walkway. The drain hole is higher than the rest of the floor. Grind slots in floor for water to drain. | Disputed by Delta T | Investigate | $ 500 | $ 500 | ||||
| 2103 | #94 Install conductivity meter on inlet to condensate collection skid. HAZOP Item #1. Dec. 12, 2007 | Disputed by Delta T | Nedak to provide Code reference | $ 2,500 | $ 2,500 | ||||
| 2105 | #155 HAZOP #59 Route signal(s) to the DCS system to alert operators of a grain handling problem. Dec. 12, 2007 Still need to label sensors with grain panel indicators | Investigate | Disputed by Delta T | $ 1,000 | $ 1,000 | ||||
| 2108 | #33) HAZOP item #3 Install guards on condensate skids flex hoses Dec. 12, 2007 | Disputed by Delta T | Nedak to provide Code reference | $ 1,200 | $ 1,200 |
EXHIBIT A
Page 13of 17
NEDAK INTEGRATED PUNCH LIST
| 2109 | #34) HAZOP item #4 Install lel/ o2 monitors in first floor of DD&E to detect elevated levels of alcohol and low O2 Dec. 12, 2007 | Disputed by Delta T | Nedak to provide Code reference | $ 3,000 | $ 3,000 | ||||
| 2110 | #41) HAZOP item #25 Install a spray shield on top of the filter basket. Dec. 12, 2007 | Investigate | Disputed by Delta T | $ 500 | $ 500 | ||||
| 2111 | #53)HAZOP item #48 No positive means to isolate DD&E vapor header hazardous from the non-hazardous vapor header Dec. 12, 2007 | Disputed by Delta T | Nedak to provide Code reference | $ 20,000 | $ 2,000 | ||||
| 2113 | #153) Safety railing above control room not installed correctly July 15, 2008. Needs better anchoring. | Nedak's instructions were to allow the handrail to be removable. | Disputed by Delta T | Delta T to consider reinforcing support at the top of the stairwell | $ 500 | $ 500 | |||
| 2114 | There are under ground fire line valves that are installed at different heights theses need to be raised up so that they are at the same height | Not required by Code | Disputed by Delta T | Investigate, south of wet pad; 4 lines | $ 500 | $ 500 | |||
| 2115 | DCOL-11 Duct seems to be to high off the steel no support for feet. | $ 2,000 | $ 500 | ||||||
| 2116 | When you exit the dryer/rto mcc room to the south there is a trip hazard. Where the French drain was installed. Also this is the emergency exit route with no clear route. | Exit Route is to the left. Delta T to provide Exit Sign | Disputed by Delta T | Grating added | $ 100 | $ 100 | |||
| 2117 | Building wall insulation is ripped and damaged. Need to install wall coverings on the inside. The insulation that is installed has a plastic cover on it but this insulation is ripped in many areas where now it is unsightly and has lost it’s ability to keep the insulation from becoming damaged. | Not included in Scope; Previously Addressed | Disputed by Delta T | DUPLICATE reference 1601 | $ 10,000 | $ 10,000 | |||
| 2118 | Paint all exposed carbon steel on site including handrail and pipe. | Reference 1073, 1437, 1503, 1517, 1530, 2081, 2087 | $ 30,000 | $ 30,000 | |||||
| Sitework | |||||||||
| 30 | General | Area between DD&E and DD&E MCC room - Area needs to be sloped to keep alcohol away from building. | Ground is frozen work has not been done | Disputed by Delta T | Category: SITE GRADING | $ 12,000 | $ 12,000 | ||
EXHIBIT A
Page 14of 17
NEDAK INTEGRATED PUNCH LIST
| 152 | Plant Tanks | Concrete containment needs to be poured around the Fermenters and BOP tanks. Just like the containment around the DD&E columns (curbing and sump hole). As per NEDAK's NPDES Permit. Prohibited Discharges 1. The discharge of process wastewater from NEDAK facility is prohibited. Process wastewater is defined as any waste stream generated from the chemical, physical, or biological procedures utilized to produce ethanol from corn. 2. Any spills, leaks, or waste stream shall be immediately reported to the NDEQ.discharges from the NEDAK facility to the on-site storm water retention pond. | Change Order Pending (Nedak will provide DTC copy of written proposal received for concrete work.) Delta-T is still reviewing. | Disputed by Nedak; Disputed by Delta T | Category: Concrete Spill Containment | $ 43,000 | $ 43,000 | ||
| 1409 | Rock usage from NEDAK pile for DTC to use through out the plant | Change Order Pending Martin is working on rock quantities and value. No answer yet. | Disputed by Delta T | Category: Rock Landscaping | $ 30,000 | $ 30,000 | |||
| 1549 | Some of the site ground work may need to be performed sooner than later. Such as on the South side of the main gate , watereways, and the entrance to the storm water pit. | Owner's Scope of Work, Exhibit A.3.9 | Disputed by Delta T | See 1600 | |||||
| 1600 | Storm pond drain pipe and rock needs repair | Owner's Scope of Work, Exhibit A.3.9 | Disputed by Delta T | Category: Storm Pond Repair | $ 12,000 | $ 12,000 | |||
| 2026 | Site | Landscape and spread rock over whole site per design. | Disputed by Delta T | See 1409 | |||||
| 2066 | Ken | Grade surfaces around BOP tanks so water will drain. | Disputed by Delta T | See 152 | |||||
| 2080 | Ken | Need retaining wall to maintain access to well pump 7305A manway on east side of MCC for DDE | Not included in Delta T scope of work, reference Exhibit A, Page 41, Site Work | Disputed by Delta T | Category: Retaining Wall | $ 10,000 | $ 10,000 | ||
| 3000 | Fire Truck Access Road | Disputed by Delta T | Category: Fire Truck Access | $ 30,000 | $ 30,000 |
EXHIBIT A
Page 15of 17
NEDAK INTEGRATED PUNCH LIST
| Record Documents | |||||||||
| 74 | General | Documentation of Testing Results - Documentation needed for PSM compliance; DTC will provide standard turnover package. | Not sure DTC has standard turnover package | Record Documents | |||||
| 74 | Plant | Need cal sheets on all instruments that were installed so that replacements can be set up the same | Same as 74 | Record Documents | |||||
| 142 | General | Drawings - Need sealed drawings by Engineer | To Be given at project end | Resolved pending completion | Record Documents | ||||
| 587 | General | General | Make sure DCS graphics, motor controls, control logic actually coincide with what is installed | NEED TO CHECK OUT YET BEFORE Closing - Dryer, RTO , Boiler not Hooked to DCS yet. System to be checked out when commissioning | Record Documents; Delta T to consider havings Siemens on site for software updates | ||||
| 916 | General | Confirm weight packages on all field erected vacuum breakers | Have not received documentation on weight packages for psv valves | Record Documents | |||||
| 956 | Yeast Prop tank | install a new 12" vacuum breaker to replace the existing 8" on the yeast prop tank to replace PSV31117. We should also consider setting the vacuum rating on this new 12" relief devise to 2" wc vs 4" wc Procure 20" manway vacuum breaker. Reset existing 8" vacuum breaker. | No documentation or up dated drawings on the yeast prop | Record Documents | |||||
| 1373 | meet as built requirements per the contract | Record Documents | |||||||
| 1397 | Plant | QA / QC report on testing of pipes thru out the plant. Per Delta-T's EQ-100-04 Quality Assurance states that the piping installation & testing will conform to 1. ASME B31.1, 2. ASME B31.3, 3. ASME B31.4, 4. ASME B31.8, 5. International build code. 6. AWS, 7. OSHA | There has already been 1 pipe fitting blow off of a steam header and 1 off of the condensate header because of faulty installation. | Jeff working on getting report | Record Documents | ||||
| 1545 | Grains | Please provide Sequence of Operation which accurately represents what has been provided. | Need SOP | ||||||
| 2106 | #158 HAZOP #62 Confirm RTO to Delta-T interfaces with DCS, etc Still missing control logic for interfacing. | Record documents | |||||||
EXHIBIT A
Page 16of 17
NEDAK INTEGRATED PUNCH LIST
| 2107 | #29) Need P&ID drawings of grain system and standard operation procedures. Nov. 19, 2007 | Record documents | |||||||
| 3001 | Scrubber | Low Point Drains on Scrubber Duct need to be provided with drain recievers | $ 2,000 | ||||||
| 3002 | Exterior Tanks | Manway bolts on Tanks are corroding; Need to be non-corroding | $ 1,000 | ||||||
| 3003 | Dryer | Conduit El Covers are missing below Conveyor 605 | $ 50 | ||||||
| 3004 | Dryer | Zero Speed Switch X5204 does not display on DCS Screen | $ 300 | ||||||
| 3005 | Control Room MCC | Air Conditioner in MCC above control room has insufficient capacity | $ 5,000 | ||||||
| 3006 | Fermentation | Beer Mash Heat Exchanger is not per design | Per email of June 17, TRV to Cliff | $ 40,000 | |||||
| 3007 | Fermentation | Mash Cooler Heat Exchanger is not per design | Per email of June 17, TRV to Cliff | $ 20,000 | |||||
| 3008 | Pump configurations do not protect pumps from dead heading | Duplicate of 2078 | |||||||
| 3009 |
EXHIBIT A
Page 17of 17
EXHIBIT B
EXCEPTED PUNCHLIST WORK TO BE COMPLETED BY DELTA-T
| A. | Emissions Equipment |
| | 1. | CO2 Scrubber — initial modifications have been installed and are awaiting final corrections arising from a recent event and subsequent final testing. |
| | 2. | RTO Stack — any required modifications and Emissions Re-Testing |
| B. | Urgent Punchlist Work and/or Services |
| | 1. | Item 2007 — Delivery of replacement air valve by Delta-T for installation by Nedak |
| | 2. | Item 2015 - Delivery of flex joint FLXS-14 on dryer by Delta-T for installation by NEDAK |
Items 3 and 4, below, are, or may be in dispute between the parties. All parties reserve all rights relating thereto. NEDAK reserves all rights to commence appropriate legal proceedings regarding such items if amicable resolution cannot be achieved. However, any such disputes shall not be a condition which may result in NEDAK drawing on the Extended LOC.
| | 3. | Item 2115 — Completion of dryer duct support by Delta-T |
| | 4. | Items 74, 142, 587, 916, 956, 1373, 1397, 1545, 2106, 2107 Record documents to include Electric Inspector Report, updated drawings for Atkinson and the design drawing provided by ITAC to O’Neill |
EXHIBIT C
REMEDIAL EMISSIONS WORK
For CO2 Scrubber
| A. | Schedules. |
1. CO2 Scrubber.
| Task | Completion Date |
| (a) Delta-t submits alternate proposals for specific tasks relating to Remedial Emissions Work | Completed |
| (b) Delta-T commences work on Remedial Emissions Work | Completed |
| (c) Delta-T completes all Remedial Emissions Work. | Completed |
| (d) Delta-T conducts scrubber and other necessary emissions testing of the plant facilities to determine compliance by the plant with all NDEQ Standards and those standards and requirements set forth in this exhibit. | September 25, 20091 |
| (e) NDEQ acknowledges that the plant meets all NDEQ standards. | See #3 below. |
2. RTO Stack. Changes and emissions testing shall be completed no later than September 25, 2009.1
3. (a) Provided that testing results referenced in A(1)(d) and paragraph 2, above, preliminarily indicate compliance by the plant with all NDEQ standards and those standards and requirements set forth in this Exhibit C, Delta-T shall cause its contracted testing engineer promptly to complete all calculations, verifications and other work necessary for formal submittal of the test results to NDEQ (“NDEQ Document Package”). Thereafter, Delta-T and NEDAK shall promptly work together to submit the Delta-T engineer NDEQ Document Package to NDEQ for its review (“NDEQ Document Submission Date”).
(b) If, but only if, the NDEQ Document Package indicates compliance by the plant with all NDEQ Standards and those standards set forth in this Exhibit C, then the “step down” reduction in the face amount of the Extended LOC as contemplated under paragraph 2(e) of Amendment No. 3 shall be submitted by NEDAK to reduce the face amount of the Extended LOC to $1,500,000 effective with the later to occur of (i) five (5) operational days subsequent to the completion of all emissions testing presently contemplated to occur commencing September 16, 2009, or (ii) the NDEQ Document Submission Date, provided however, that such reduction in Extended LOC shall not occur on such date if and to the extent that either unsatisfied Delta-T lien claims or potential Delta-T lien claims remain outstanding. For purposes of this subparagraph, “potential lien claims” shall mean any subcontractor, supplier, equipment maker
1 This date shall be automatically extended if and to the extent that the plant has an upset condition, infection, or other event outside the control of Delta-T Corporation that affects its ability to conduct the planned emissions tests.
or materialmen having a claim in excess of $70,000, and who still possesses rights to assert a lien claim under Nebraska statutory lien law.
(c) Delta-T and NEDAK shall allow NDEQ no more than forty-five (45) days from the date of NDEQ Document Submission Date for NDEQ to review and accept or reject the NDEQ Document Package. If NDEQ within such forty-five (45) day period neither accepts or rejects the NDEQ Document Package, such non-action shall be deemed acceptance by NDEQ for purposes of this Amendment No. 3, and NEDAK shall have no further rights to draw on the Extended LOC arising from Remedial Emissions Work.
(d) Upon any rejection or disapproval by NDEQ of the NDEQ Document Package, the terms and conditions set forth in paragraph 2(e) of this Amendment No. 3 shall be applicable. Any further subsequent corrections of any emissions deficiencies performed by Delta-T pursuant to paragraph 2(e) shall proceed through the same process and procedures as set forth in Amendment No. 3 and this Exhibit C for re-testing and resubmission of a revised NDEQ Document Package to NDEQ.
| B. | Additional testing requirements/standards for the plant relating to Remedial Emissions Work on the Emissions Equipment set forth in Exhibit B (A). |
1. Denatured ethanol shall meet specifications for fuel ethanol per ASTM D4806-04 while meeting all NDEQ emission limitations consistent with the NDEQ Permit.
2. All parties shall confirm in writing that zero process water discharge exists while meeting all NDEQ emissions limitations.
3. Chemicals added to the CO2 scrubber during any plant emissions testing for compliance with NDEQ standards, shall be at the minimum amount necessary to achieve all NDEQ Standards with a fully operational and functioning ethanol plant while meeting all standards set forth in subparagraph B(1), above.
EXHIBIT D
IN THE DISTRICT COURT OF DOUGLAS COUNTY, NEBRASKA
| DELTA-T CORPORATION, ) ) Plaintiff, ) ) v. ) ) NEDAK ETHANOL, LLC and ) AGCOUNTRY FARM CREDIT ) SERVICES, ) ) Defendant. ) | DOC. 1096 827 STIPULATION AND DISMISSAL PARTIALLY WITH AND PARTIALLY WITHOUT PREJUDICE |
THE PARTIES by and through their respective attorneys hereby stipulate and agree that the above captioned action shall be dismissed without prejudice, that the Temporary Restraining Order previously issued by the Court on or about June 25, 2009, shall be dissolved and removed, any bond or payment related thereto exonerated, and each party shall pay its own fees and costs, and completed record waived, subject to the following provisions:
(1) The dismissal without prejudice to claims solely between NEDAK and Delta-T shall permit NEDAK and Delta-T only to initiate further claims in the future with a fact finder solely in the events that either (a) either party alleges, subsequent to the execution of this stipulation, that the other party breached the terms and conditions of Amendment No. 3 dated , 2009 or (b) NEDAK draws on the Extended LOC referenced in such Amendment No. 3 and Delta-T asserts claims that NEDAK wrongfully or improperly drew on such Extended LOC. Except as stated this dismissal shall be with prejudice.
(2) This dismissal shall be with prejudice as to Plaintiff’s third cause of action against Defendant AgCountry Farm Credit Services for unjust enrichment.
Respectfully submitted,
| NEDAK Ethanol, LLC By: _________________________________ Thomas H. Dahlk (#15371) Victoria H. Buter (#23841) Husch Blackwell Sanders, LLP 1620 Dodge Street, Suite 2100 Omaha, Nebraska 68102 Phone: (402) 964-5000 Fax: ###-###-#### ***@*** ***@*** | Delta-T Corporation By: ___________________________________ Terry R. Wittler, #15584 Richard P. Jeffries, #20089 CLINE, WILLIAMS, WRIGHT, JOHNSON & OLDFATHER, L.L.P. One Pacific Place 1125 South 103rd Street, Suite 320 Omaha, Nebraska 68124 |
| AND | |
| AgCountry Farm Credit Services | |
| David W. Schiffrin, Washington State Bar Asociation #650, Admitted Pro Hac Vice Schiffrin Olson Schlemlein & Hopkins 1601 Fifth Avenue, Suite 2500 Seattle, WA 98101 Phone: ###-###-#### Fax: ###-###-#### | By: _________________________________ Joshua C. Dickinson #23700 Thomas C. Anschultz, #23103 Spencer Fane Britt & Browne LLP 9420 Underwood Avenue Suite 200 Omaha, NE 68114-6608 |
This stipulation and agreements between the parties are hereby so ordered.
DATED THIS _______ day of __________________, 2009.
BY THE COURT:
__________________________________________
Thomas a. Otepka
District Judge
APPROVED AS TO FORM AND CONTENT:
____________________________________
Terry R. Wittler, #15584
Richard P. Jeffries, #20089
CLINE, WILLIAMS, WRIGHT,
JOHNSON & OLDFATHER, L.L.P.
One Pacific Place
1125 South 103rd Street, Suite 320
Omaha, Nebraska 68124
Counsel for Plantiff
____________________________________
David W. Schiffrin (admitted pro hac vice)
Thomas H. Dahlk, #15371
Victoria H. Buter, #23841
Husch Blackwell Sanders LLP
1620 Dodge Street
Suite 2100
Omaha, NE 68102
Counsel for Defendant NEDAK Ethanol, LLC
____________________________________
Joshua C. Dickinson #23700
Thomas C. Anschutz, #23103
Spencer Fane Britt & Browne LLP
9420 Underwood Avenue
Suite 200
Omaha, NE 68114-6608
Counsel for Defendant AgCountry Farm Credit Services
