HomeMy WebLinkAboutContracts & Agreements_190-2007_CCv0001.pdf AGREEMENT FOR THE SALE AND PURCHASE
?.a OF LIQUEFIED METHANE GAS
This Agreement for the Sale and Purchase of Liquefied Methane Gas
("Agreement") is entered into this I6th day of October, 2007 (the "Commencement
Date")by and between Applied LNG Technologies USA, L.L.C. ("Seller") and the City
of Redlands("Buyer"). Seller and Buyer are sometimes individually referred to herein as
a"Party" and,together, as the"Parties."
RECITALS
A. Seller is in the business of producing, selling and transporting Liquefied
Methane Gas ("LMG"); and
B. Buyer is seeking a source of LMG for Buyers direct consumption at
Buyer's Point of Delivery ("POD") (hereinafter defined); and
C. Seller wishes to sell LMG to Buyer, and Buyer wishes to purchase LMG
from Seller on the terms and conditions expressed in this Agreement;
NOW, THEREFORE, in consideration of the above-referenced premises,the
bargained-for exchange of promises contained in this Agreement and other valuable
consideration, the receipt and adequacy of which are acknowledged by the Parties, Seller
agrees to sell and deliver to Buyer, and Buyer agrees to purchase, receive and pay for
LMG in the quantities and under the terms and conditions specifically set forth in this
Agreement.
ARTICLE I
Definitions
The following terms shall have the following meanings in this Agreement
A. "Affiliates" shall mean any person who,directly or indirectly, controls, is
controlled by or is under common control with the relevant person.
B. "Contract Year,- shall mean a twelve-month period beginning at 7:00 am
Pacific Standard Time on the Commencement Date and each anniversary
thereof
C. "Effective Date" shall mean the date as defined on the respective Exhibit
A for each Point of Delivery.
D. "Gallon" shall mean the volume of LMG equal to 3,55 lbs.
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E. "Liquefied Methane Gas" or"LMG" shall mean the liquid methane sold
by Seller and delivered to Buyer which meets the product specifications
described in Article V.
F. "Purchase Period" shall mean, for each POD, each period of one (I)
calendar month, commencing upon the Effective Date for such POD.
G. "Reserved Amount" shall mean, for each POD, the amount of LMG that
Seller has reserved for sale to Buyer in each Purchase Period for such
POD,
H. "Reserve Period" shall mean the three-month period defined in Exhibit
ARTICLE II
Term
2.1 Term. Except as otherwise provided in Exhibit"A," the initial term of this
Agreement shall commence on the Commencement Date and shall continue in effect for
three (3) years and shall be extended automatically for successive (I) one-year renewal
periods thereafter unless terminated as provided in Section 22.
2.2 Termination.
(a) Buyer shall have the right to terminate this Agreement at the end of the
initial term or any renewal period by providing written notice to Seller at least ninety (90)
days prior to the expiration date of such period;provided, however,that in the event
Buyer delivers such notice of termination to Seller, Seller shall have the right to match
any price offer to sell LMG made by any third party to Buyer preceding the expiration
date of such period, and if such third-party offer is so matched by Seller within thirty (30)
days of Buyer's disclosure of such offer to Seller, then Buyer shall agree to extend the
term of purchase hereunder for the next applicable one (I) year renewal period.
(b) Seller shall have the right to terminate this Agreement at the end of the
initial term or any renewal period by providing written notice to Buyer at least ninety
(90) days prior to the expiration date of such period.
ARTICLE III
Quantities
3.1 Amount. For each Point of Delivery, Seller agrees to sell and deliver to Buyer,
and Buyer agrees to purchase and receive from Seller all quantities of LMG required for
Buyer's operations not to exceed the quantity of LMG stipulated in Exhibit"A"in any
given Reserve Period. Should Buyer's requirements for LMG exceed the Reserved
Amount, as it may be adjusted, in any Reser\e Period, Seller shall endeavor in good faith
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to provide such excess quantities of LMG to Buyer at the greater of the LMG Base Unit
Price described in Article IV or Seller's then current LMG Spot Market Price. Buyer
agrees to purchase Buyer's entire LMG requirements from Seller during the term of this
14,1
Agreement. Buyer's obligation under this section shall not apply to quantities of LNG
that Buyer fails to accept due to a Force Majeure event as defined in Article IX hereof
and subject to the conditions and limitations stated therein.
3.2 Changes in Reserved Amount. In the event during any Reserve Period, the
purchases by Buyer are lower than the Reserved Amount for such Reserve Period,then
the Reserved Amount will be reduced in each subsequent Reserve Period until the
termination of this Agreement by an amount equal to the amount not purchased. Any
such change shall only become effective on the first day of the subsequent Reserve
Period,
ARTICLE IV
Price
4.1 Price. The LMG Base Unit Price is set forth in the Exhibit"A" for each Point
of Delivery. For all LMG delivered hereunder in each Purchase Period, Buyer shall pay
to Seller the LMG Base Unit Price (as it may be adjusted each month for changes in
feedstock as described in Exhibit"A")plus the Cost of Transportation as set forth in
Exhibit"A."Beginning with the first(1st)anniversary of the Effective Date of each
Exhibit A, Seller may adjust the LMG Base Unit Price (including the monthly adjustment
provision) and the Cost of Transportation at any time by providing written notice to
Buyer at least thirty (30) days prior to the Effective Date of any adjustment and each such
adjustment shall apply to all LMG delivered to Buyer on and after the effective date of
such notice; provided, however, that if such adjustment(including any prior adjustments
for the same Contract Year) would result in an increase in the LMG Base Unit Price plus
the Cost of Transportation during the Contract Year in which such adjustment takes
affect of more than five percent (5%) over the prior Contract Year's LMG Base Unit
Price and Cost of Transportation,and Buyer, within forty-five (45) days after receipt of
such notice, furnishes Seller with credible written evidence that Buyer can purchase
LMG from a single source in quantities at least equal to the amount sold in the prior
Contract Year at average effective aggregate pricing lower than that to be in effect under
this Agreement after said adjustment and with other commercial terms comparable to this
Agreement and if Seller does not agree to (i)meet said lower price, or(ii)reduce price to
the LMC Base Unit Price and Cost of Transportation prior to adjustment,whichever
results in a higher price,within thirty(30) days thereafter, Buyer shall have the right to
terminate this Agreement by giving Seller not less than ten(10) days prior written notice.
4.2 Quality. Buyer shall have no obligation hereunder to accept delivery of or to
purchase or pay for LMG which is not in compliance with the quality specifications set
forth herein,provided that Buyer has provided timely notice of such noncompliance
pursuant to Section 5.4 hereof. Seller, at its sole expense, shall replace all such LMG that
fails to meet the quality specifications immediately upon Buyer's providing notice of the
same pursuant to Section 5.4.
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4.3 LMG Source. LMG supplied under this Agreement may be produced at any
plant of Seller or other supply source of Seller. Seller shall attempt to provide Buyer
with the most economical supply of LMG based on availability at the time of Buyer's
order. If LMG is not produced from Seller's facility or contracted supply source as
described in Exhibit "A,"then the price charged hereunder shall be revised to reflect
additional charges incurred by Seller in acquiring LMG for delivery to Buyer from other
sources and delivering such LMG.
ARTICLE V
Quality
5.1 Specifications. LMG sold and delivered by Seller hereunder shall contain no
less than ninety-seven percent(97%)methane and, unless otherwise agreed to by the
Parties, no more than one percent(1 %) ethane and one-half percent(1/2 %)other
hydrocarbons, with the balance to be inert gases.
5.2 No Odorization. Seller shall have no obligation to odorize LMG sold and
delivered hereunder.
5.3 Tests. Seller, at its own expense, shall conduct periodic quality and
composition tests and analyses of LMG produced from Seller's facilities and will retain
records of such tests and analyses for review by Buyer. Buyer shall have the right at its
sole cost to independently test or analyze LMG tendered for delivery by Seller.
5.4 Compliance. The quality of LMG delivered and sold hereunder shall be for
all purposes conclusively deemed to be in full compliance with the quality specifications
set forth herein when delivered into Buyer's containers or storage tanks at Buyer's point
of delivery.
5,5 Disclaimer. EXCEPT AS SPECIFICALLY SET FORTH HEREIN, SELLER
DISCLAIMS ALL EXPRESS OR IMPLIED WARRANTIES OF ANY KIND,
INCLUDING BUT NOT LIMITED TO, WARRANTIES OF MERCHANTABILITY
AND FITNESS FOR A PARTICULAR USE OR PURPOSE.
ARTICLE VI
Measurement and Delivery
6.1 Point of Delivery. The point of delivery of LMG shall be at the point(s) of
delivery as shown in Exhibit"A"(s) ("Buyer's POD"). Title to all LMG sold hereunder
shall pass from Seller to Buyer at Buyer's POD as the LMG is delivered into Buyer's
containers or storage tanks at Buyer's POD; provided that, title to LMG that does not
meet the quality specifications set forth in Section 5.1 shall not pass to Buyer and shall at
all times remain with Seller. Buyer shall provide Seller at least 72 hours notice of
requested deliveries.
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6.2 Measurement. The measurement of LMG delivered hereunder shall be based
upon Seller's truck scales. Notwithstanding the above,Buyer may elect each LMG
container to be weighed by a mutually agreed upon third party and Buyer shall pay for
any fees assessed by such third party and Sellers cost of out of route miles driven and
delay charges accrued to accommodate such request.
6.3 Compliance. Seller's measurement of LMG sold and delivered hereunder, and
the measured quantities of LMG set forth on Seller's documents of delivery and sales
invoices, shall be for all purposes deemed conclusive unless within seven(7)business
days of the date of delivery or receipt of invoice Buyer delivers to Seller written notice of
any claimed error in measurement or shortage of delivered quantities.
6.4 Delay. LMG must be received by Buyer within two hours after arrival of
Seller's truck at Buyer's POD. For each quarter-hour in excess of the allotted two hours
Buyer shall be charged a delay fee amount stated in Exhibit"A."
ARTICLE VII
Billing and Payment
7.1 Invoice. Seller shall render an invoice to Buyer for each load of LMG
delivered by Seller. The invoice shall reflect total Gallons of LMG delivered, any other
applicable charges and adjustments and the total amount due and payable. Buyer shall
receive an invoice within ten (10)business days of each LMG delivery.
7.2 Payment. Within five(5) days of receipt of an invoice, Buyer shall make
payment in U.S. dollars to Seller of all amounts due, in immediately available funds to
the address shown in Article XII,hereof.
7,3 Interest. Should Buyer fail to pay the amount of any invoice rendered by
Seller when such amount is due, interest shall accrue thereon at a rate of interest equal to
the prime commercial rate charged by Citibank, N.A., New York as it may change from
time to time,plus two percent (2%), or the maximum legal rate, whichever is the lesser,
compounded annually from the date such payment is due until payment is made.
7.4 Remedies. If such failure to pay continues for thirty (30)days after payment is
due, Seller, in addition to any other remedy it may have, may suspend further deliveries
of LMG to Buyer's POD until such amount is paid unless Buyer in good faith disputes the
amount claimed, or takes any such other action as may be allowed by law.
7.5 Delay. If rendering of an invoice by Seller is delayed beyond the date
provided for in Section 7.1 hereof, then the time for payment shall be extended
correspondingly unless Buyer is responsible for such delay.
7.6 Errors, In the event an error is discovered in any invoice rendered by Seller.
the amount of such error shall be adjusted provided that claim therefore shall have been
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made within twelve (12)months, from the date such invoice was rendered. All
adjustments shall be made within thirty(30)days of receipt of a timely claim.
ARTICLE VIII
Taxes
8.1 Taxes. It is agreed that any duty, tax, fee or other charge which Seller may be
required to collect or pay under any municipal, state, federal,or other laws now in effect
or hereafter enacted with respect to the delivery and sale of LMG by Seller to Buyer,
including federal, state and local, excise,use and sales tax, shall be added to the prices to
be paid by Buyer for LMG sold and delivered hereunder.
ARTICLE IX
Support Services
9. Marketing. Seller shall assist Buyer in the expansion and promotion of
Buyer's fueling station by performing for Buyer the support described in the letters
attached hereto as Exhibits "A" and"B" which are incorporated herein by the reference.
ARTICLE X
Force Majeure
10.1 Notice. If either Seller or Buyer is prevented or rendered unable by Force
Majeure to perform or comply with any obligation of this Agreement, upon giving
written notice and reasonably full particulars of the Force Majeure event to the other
Party, the affected Partys obligations shall be suspended during the continuance of the
Force Majeure event and such Party shall not be considered in default in the performance
of its obligations under this Agreement but only with respect to the particular component
of obligations affected by the event and only for the period during which the Force
Majeure event exists; provided,however, obligations to make payment for LMG
delivered prior to the onset of the Force Majeure event shall not be suspended. A Party
affected by a Force Majeure event shall take appropriate action to minimize the
consequences of the event,to rectify the conditions brought about by the Force Majeure
event and to resume performance under this Agreement as soon as is reasonably feasible.
Settlement of strikes and lockouts shall be wholly within the discretion of the Party
subject to same.
10.2 E,t .1‘41ettre. The term "Force Majeure" shall mean any event which is
beyond the reasonable control and without the fault or negligence of the Party affected
and shall include but not be limited to acts of God, the public enemy and Governmental
or regulatory agencies including, but not limited to acts resulting in shut-down or
curtailment of third party methane gas production and/or transportation facilities
supplying Seller; or facilities supplying LMG to Seller; any force majuere event declared
by Seller's suppliers of LMG; acts resulting in shut-downs of Buyer's storage facilities or
equipment;the elements, such as lightning, lire, or abnormally severe weather w hich
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cause a complete or partial shut-down of Seller's LMG production facilities, Buyer's
LMG storage facilities, Buyer's equipment,or the facilities of Seller's third party methane
gas suppliers and transporters; breakage or accidents to wells, vehicles, machinery,
equipment or lines of pipe which prevent either Buyer or Seller or the third party
suppliers of either Buyer or Seller from operating or delivering methane gas to Seller or
which prevent Buyer from storing LMG; inability to obtain permits; strikes (including
strikes of shipping agents, dockers, and truck drivers) and other industrial,civil, or public
disturbances preventing Seller from supplying LMG or Buyer from taking delivery of
LMG hereunder.
10.3 Assertion of Force Majeure. The Party asserting Force Majeure shall in each
instance give the other Party written notice as soon as possible but not later than five( 5 )
working days after knowledge of the beginning of the Force Majeure event. Such notice
shall include a brief description of the events or circumstances of Force Majeure and an
estimate of the anticipated period of suspension. Not later than five( 5 )working days
after the cessation of the Force Majeure event the Party that asserted the same shall give
the other Party written notice of the date of such cessation.
ARTICLE XI
Compliance with Law and Regulatory Authorities
11.1 Laws. This Agreement is subject to all valid laws, orders, rules and
regulations of duly constituted authorities having jurisdiction and the Parties hereto agree
to comply with all such laws, orders, rules and regulations applicable to any activities
carried out under the provisions of this Agreement.
11.2 Hazardous Materials, The Parties expressly recognize and acknowledge that
the delivery and receipt of LMG hereunder requires the Parties to handle hazardous
substances and both Parties agree that in so delivering and receiving and in storing,
handling,transporting, offering and delivering for sale or use, exchanging, or using LMG
purchased hereunder, the Parties will in all respects exercise the strictest care required by
all applicable safety procedures and rules specified in federal, state and local laws,
regulations and ordinances as exist now or hereafter come into force, including but not
limited to, those governing dispensing equipment,pollution,the maximum component
content of LMG and the labeling of dispensers of LMG,the use and labeling of LMG
containers, storage tanks, and transportation containers and related equipment, the
prevention of releases, leaks, venting or other improper escape from LMG containers,
storage tanks, or transportation containers, and the method of clean up or disposal of
LMG which has leaked, spilled, vented or otherwise improperly escaped from such
containers and storage tanks as a result of the respective Party's acts or omissions. Each
Party shall indemnify, defend, protect, and hold harmless the other Party, its successors
and assigns, the manufacturer of the LMG, and their assigns, against all losses, claims,
causes of action, penalties and liabilities arising out of the indemnifying Party's failure to
comply with the preceding sentences.
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ARTICLE XII
Assignment
12A Inurnment, This Agreement shall be binding upon and inure to the benefit of
the legal successors and assigns of the respective Parties hereto.
12.2 Assignment.No assignment of this Agreement or of any right or obligation
there under shall be made without the prior written consent of the non-assigning Party,
such consent not to be unreasonably withheld.
ARTICLE XIII
Notices
13.1. Address. Any notice,request, demand, statement or payment provided for
or required in this Agreement shall be sent to the Parties hereto at the following
addresses:
Seller: APPLIED LNG TECHNOLOGIES USA, LLC
3011 Knox Street, Suite 403
Dallas,TX 75205
Attn: Kevin Markey, Vice President Operations
Payments Only:
Check US Mail: Applied LNG Technologies USA, LLC.
PO BOX 673858
DETROIT MI 48267-3858
Check Overnight Express: 673858 LOCKBOX DEPARTMENT
APPLIED LNG TECHNOLOGIES USA LLC
39200 WEST SIX MILE ROAD
LIVONIA MI 48152-3531
Wiring Instructions: APPLIED LNG TECHNOLOGIES USA LLC
Comerica Bank
Detroit MI
Account No: 1852316395
ABA Routing No: 072000096
RE Invoice No:
Buyer: See Exhibit -A" attached hereto.
112 Tim . Except as may otherwise be provided for herein any notice, request
or demand required under this Agreement shall be personally delivered or mailed by
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certified mail, postage prepaid, return receipt requested, or sent by reputable overnight
carrier to the Parties' addresses above, Notice sent in the manner provided above shall be
deemed given and received upon receipt.
133 Changes, Either Party may change its address and provide a different address
for specific notification purposes under this Article by giving written notice thereof to the
other Party.
ARTICLE XIV
General Provisions
14.1 Amendment. This Agreement may be amended at any time by the written
agreement of the Parties. All amendments, changes, revisions and discharges of this
Agreement, in whole or in part,made from time to time, shall be binding upon the Parties
despite any lack of legal consideration, so long as the same shall be in writing and
executed by the Parties hereto.
14.2 Applicable Law. The existence, validity, construction and operational effect
of this Agreement, any and all of its covenants, agreements,terms and conditions and the
rights and obligations hereunder of each of the Parties hereto shall be determined in
accordance with the laws of the State of California. In the event that any dispute under
this Agreement arises and a lawsuit is instituted, then, in addition to any other method
that may be permitted by applicable law, service of process may be effected by means of
United States mail, sent registered,postage prepaid to the address for notices set forth in
Article XIII. In the event that any lawsuit is instituted by a Party to this Agreement
growing out of a dispute that is related to this Agreement,then the Parties to this
Agreement hereby consent to the jurisdiction of the Federal, State and Local Courts for
San Bernardino County, California.
14.3 Attorneys'Fees. If either Party to this Agreement shall bring any action for
any relief against the other, declaratory or otherwise,arising out of this Agreement, the
losing Party shall pay to the prevailing Party a reasonable sum for attorneys' fees incurred
in bringing such suit and/or enforcing any judgment granted therein, including fees for
use of in-house counsel by a Party. all of which shall be deemed to have accrued upon the
commencement of such action and shall be paid whether or not such action is prosecuted
to judgment. Any judgment or order entered in such action shall contain a specific
provision providing for the recovery of attorneys' fees and costs incurred in enforcing
such judgment. For the purpose of this section, attorneys' fees shall include, without
limitation, fees incurred in the following: (1)post-judgment motions; (2) contempt
proceedings; (3) garnishment, levy, and debtor and third party examinations; (4)
discovery; and(5) bankruptcy litigation.
14,4 Arbitration, Any controversy, dispute or claim arising out of the
interpretation, performance or breach of this Agreement may be resolved, upon mutual
agreement of the Parties, by binding arbitration, at the request of either Seller or Buyer, in
accordance with the rules of the American Arbitration Association. In such case, the
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decision of the arbitrators shall be final and shall not be reviewable for error of law or
legal reasoning of any kind. In the event the Parties cannot agree to resolution by binding
arbitration,either Party may proceed to obtain resolution by means of litigation that shall
be commended in the appropriate court ot jurisdiction in the County ot San er ardmo,
State of California.
14.5 Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which,taken together, shall constitute one
and the same instrument.
14.6 Entire Agreement. This Agreement contains the entire agreement between
the Parties respecting the subject matter of this Agreement and supersedes all prior
understandings and agreements,whether oral or in writing,between the Parties regarding
the same.
14.7 Exhibits. All exhibits to which reference is made in this Agreement are
deemed incorporated into this Agreement, whether or not actually attached.
^ _--
14.8 Full Performance Re•uired. Performance of any duty imposed on either
Party by this Agreement is conditioned on the other Party's full performance of all duties
imposed on it in this Agreement.
14.9 Further Acts. Each Party hereby agrees that it shall, upon request of the
other, execute and deliver such further documents (in form and substance reasonably
acceptable to the Party to be charged) and do such other acts and things as are reasonably
necessary and appropriate to effectuate the terms and conditions of this Agreement.
14.10 Legal Advice; Neutral Interpretation: Heading Each Party has received
independent legal advice from its attorneys with respect to the advisability of executing
this Agreement and the meaning of the provisions hereof. The provisions of this
Agreement shall be construed as to their fair meaning, and not for or against any Party
based upon any attribution to such Party as the source of the language in question.
Headings used in this Agreement are for convenience of reference only and shall not be
used in construing this Agreement.
14.11 No Third Party Benefit, This Agreement is intended to benefit only the
Parties hereto and no other person or entity has or shall acquire any rights hereunder.
14.12 Relationship of Parties. The Parties agree that their relationship is that of
Seller and Buyer. Each Party is and shall perform this Agreement as an independent
contractor, and as such shall maintain complete control over all of its employees, agents
and operations. Neither Party nor anyone employed by it shall be, represent, act,purport
to act or be deemed to be the agent, representative, employee or legal representative of
the other Party. Nor shall this Agreement be deemed to create any form of business
organization between the Parties hereto, nor is either Party granted any right or authority
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to assume or create any obligation or responsibility on behalf of the other Party, nor shall
either Party be in any way liable for any debt of the other.
14.13 Severability. If any term, covenant, condition or provision of this
Agreement,or the application thereof to any person or circumstance, shall to any extent
be held by a court of competent jurisdiction to be invalid, void or unenforceable,the
remainder of the terms, covenants, conditions or provisions of this Agreement, or the
application thereof to any person or circumstance, shall remain in full force and effect
and shall in no way be affected, impaired or invalidated thereby.
14.14 Waiver of Covenants. Conditions or Remedies. The waiver by one Party of
the performance of any covenant or condition under this Agreement shall not invalidate
this Agreement nor shall it be considered a waiver by it of any other covenant or
condition under this Agreement. The waiver by either or both Parties of the time for
performing any act under this Agreement shall not constitute a waiver of the time for
performing any other act or an identical act required to be performed at a later time.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be
executed by their duly authorized representatives, effective as of the latest date set forth
below,
CITY OF REDLANDS
("Buyer")
By „-/„44,2..-f 2,":1
Date October 16, 2007
44m
J Harrison, Mayor
ATTEST:
orrie Poyie Ciy.Clerk
APPLIED LNG TECHNOLOGIES USA, EEC
("Seller”)
Date /
Kevin Marke Vice 'resid in Op ations
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EXHIBIT A
Attached to and made a part of the Agreement For The Sale and Purchase Of Liquefied Methane
Gas,made effective as of the I6th day of October, 2007, by and between Applied LNG
Technologies USA,L.L.C. and City of Redlands,CA
Notwithstanding the provisions of Article II of this Agreement,the term of this Agreement with
respect to the Point of Delivery listed below shall commence on the latter of the Commencement
Date or the Date of First Delivery specified below and shall continue in effect for the duration
specified below and thereafter until terminated by giving not less that ninety(90)days prior
written notice of such termination to the other party,
Buyers Address-notices City of Redlands
35 Cajon Street,Suite 200
Redlands,CA 92373
Attn: Cit Matta er
Buyers address for PDF Format Attn: Mike Sepulveda
Billing-Invoices &Statements City of Redlands
PO Box 3005
At e-mail address: meseoulveda cit fredlands,or
Point of Delivery AKA-City of Redlands Corporate Yard
1270 W, Park Ave,
Redlands,CA 92373
Date of First Delive October 17,2007
Duration or Termination Date Three(3)Years
Origin -Primary Topock,AZ
LMG Base Unit Price from Primary ((SoCal/ 12.104)x L2) 0385 plus freight
Origin(excludes freight&taxes)
Transportation Price per trip from NA
Primary Origin
Alternate Ori. LMG Price 1111. 111
Alternate Origin Transportation Price
Delivery Delay Fees $25.00 per one quarter(1/4)hour.
SELLER
APPLIED r591,11‘TOOGIES USA LC
,;;;;"
Kevin, arkey
ITS; Vice President Operations
BUYER
CITY OF REDLANDS
76- -
BY: /0 /
Jon/flarrison -
ITS: Mayor
ATTEST:
Lorre Poyzei,"Ci y Clerk
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EXHIBIT 'A'
ERR _.. $OP ELS
Balanced Energy Solutions
Amite TONNOtOCALS
,
June 27,2007
Gary Van Dorst
Solid Waste Manager
City of Redlands
Municipal Utility Department
35 Cajon St..,Suite 15A
Redlands,CA 92373
Mr.Van Dorst,
Thank you for meeting with Kevin and me last week. We appreciate your business and look forward to expanding
our relationship.As a review,the following is the primary objective to meet our mutual goals.
• Grow the revenue stream to the City by providing public fueling access
o Jointly promote the newly opened station to the general public and commercial accounts.
In order to achieve this goal Applied LNG Technologies proposes to the following
• Assist in the completion of federal tax application to recoup the .50 per gallon credit
w Provide active support in marketing the availability of LNG
o Marketing via Internet hot links on targeted sites
■ City of Redlands http://www,ci,redlands.ca.us/uttlitiesiwaste news:htm
* Fleet Star,CFN,MSRC,and(AQMD)
w Implement and promote web presence
• Www.cleancarsnraps.com
o Local on-site promotion at new station,
■ Grand opening promotion and event
•
Public announcement and gifts with first fill up
• Create an informational trifold
+� "Natural Gas"Benefits and Local Fueling Program
O Media campaign
• Local and regional targeted press release
it Pursue on-air interviews(work with City public relations department)
• Assistance with the development of educational materials for promotion to the public
• Create animated banner(flash presentation)for City of Redlands website and other
mutually identified sites
O Development of signage
• Banners and other awareness tools
• We provide artwork and banners
3001 Knox 8 -Suit*401
Dana*,TX 73205
Phone:214, 201 -Fix:214.389.9805
ERF:ITHEICIF=LJELS
„, _
Bakimed Energy Solutions
ALT is able to provide the required supervision and experience on this project through the entirety of our
relationship.It is great that we have the relationship and history together. Extending our business relationship will
allow us to grow in new ways and provide us both with a more rewarding future.
Applied LNG is pleased to offer the City of Redlands the following terms.
• Convert the current agreement from month to month to a 3 year term
Price
• ((SoCal 112 104)x 1,2)+0.385 plus freight
We request the City add an addendum to the current agreement to establish the terms.
We look forward to working with you and the City on this project.Again,thank you for the opportunity,,
Jim Horton
Applied LNG Technologies
3001 Knox Street Suite 401
Dallas,TX 75208
Plano;214434.6291 -Ea* 214.389.9805
3
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A Proposal
i o Redlands
YApplied LTechnologies (A
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Objective
• Establish City of Redlands LiCNG
fueling station as a Cityprofit center
Increase awareness for new public
access LNG/CNG fueling pumps
• Establish location as a profit center
for City and increase revenues by
driving traffic to station
Targets
• LNG Fuel Sales
• Commercial accounts
• Heavy-duty trucks
• Utility Companies such as SOCAL
• Fleets
Examples might be UPS, 7-Up, etc.
• CNG Fuel Sales
• Light-duty trucks
• Consumer CNG vehicles, Toyota, Honda
Strategies
N Public Announcements
Grand Opening Event
• Giveaways and informational handouts
to Invite local leaders and city officials
Media Outreach
• Earned media - Press releases
• Paid media Possible radio remote
* University of Redlands Radio Station
KUOR
Direct Sales
• ALTIs professional, experienced sales force will
promote fuel station with all appropriate sales
leads and contacts
Si ALT has a proven sales track record
"We are the largest provider of fuel-grade
LNG in the California Market! "
• Sales efforts targeted to
• Fleet Managers
• Commercial
• Trade Shows
• Alternative fuel vehicles for consumers
Publicize Station Location
• City of Redlands website
• Communicate fuel environmental
benefits and efficiency
• Promote location and city's commitment
to clean fuels
. "Flash" presentation to promote new
location on various websites
Add City of Rds Fuel Site to
National , Regional
Local
Websites
Identify websites of common interest to
promote location and increase usage
. Possible fuel locator sites include :
■ "commercial Fueling Network" (CFN)
• County of San Bernardino
San Bernardino Associated Governments (SANBAG)
■ "clean Car Maps"
. Flex Your Power at the Pump
Other Potential Sates
▪ Clean Transportation, a National Resources
Mobile Source Air Pollution Defense Council
Reduction Review • California Energy
Committee (MSRC) Commission, Fuels and
• South Coast Air Quality Transportation Division
Management District ups. Department of
(AMD) Energy, Alternative Fuel
• California Air Pollution Locator
Control Officers Association California Air Resources
(CAPCOA) Board (CARB)
▪ Cladstein, Neandross and Carl Mower Air Quality
Associates Standards Attainment
Program
Target LNC Vehicles
. Partner with Heavy- Duty Vehicle and
Repower Companies
• Athens Services (hauling/waste trucks
for City)
• Nationwide Environmental Services
(street sweepers)
• Clean Streets (repower engines)
• Westport Innovations/Cummins
Partnership
Target CNG Vehicle Dealerships
Partner with Redlands' Dealerships
that promote and sell CNG consumer
vehicles
• A&H Auto Specialists -- Honda Dealer
. Reids Honda specialist
Torn Bell Toyota
xy
Other Possible Partners
. Redlands Chamber of Commerce
. Inland Empire Economic Partnership
• San Bernardino County Economic
Development Agency
a CALSTART Clean Car
Map/Partnership with AAA of
Northern California
AtT
. 1 u* .c
ALT will promote City's fuel site
through :
• Strong online presence
• Participation in key industry events and
tradeshows
• Public relations efforts to targeted trade
pubs
• Develop p and distribute professional
collaterals to support marketing effort
and other promotions
City of Redlandsand
Technologies
• ALT is eager for a successful
partnership with your City
• Benefits
■ City of Redlands established as a
preeminent environmentally friendly, clean
fuel city. Sets community standard for all
California
■ Successful revenue center established
. Increase availability of green fuels to
community, region and large trucking
markets
EXHIBIT IV
AiivuE„,INGTtansiotoaEs
July 27, 2007
Gary Van Dorst
Solid Waste Manager
City of Redlands
Municipal Utility Department
35 Cajon St, Suite 15A
Redlands, CA 92373
Mr. Van Dorst,
Applied LNG appreciates your business and is looking forward to expanding our
relationship with the City of Redlands. One of the ways we intend to do this is to work
with the City to open your fueling station to the general public. This new LNG station
would provide an environmentally friendly fuel to the surrounding business community
while creating a new source of revenue to the City.
In order to implement this plan Applied LNG Technologies will provide the
following:
I. Provide fuel grade LNG for the term of the agreement
2. Assist in the completion of federal tax application(IRS form 637)to process tax
credits.
3. Provide active support in marketing the public fueling station.
• Via internet hot links on targeted sites such as City of Redlands
(http://wv,w.ci.rediands.ca.us.utilities/waste news.htm), Fleet Star, CFN,
MSRC, and AQMD
• Working with public relations department to create "on-site" signage,
coordinate grand opening and promotional events, design informational
brochures on LNG.
• Identify and target surrounding commercial fleet operatiors and make
sales presentations promoting new station
• Target industry partners to receive co-op advertising funds, (Westport has
already agreed to provide co-op funding).
4. Provide a Cooperative Purchase Agreement which bundles the LNG supply with
the City of Los Angeles
• LNG pricing quote ((SoCa1112.104)x 1.2)+ 0.385 plus freight.
3001 Knox Street—Suite 401
Dallas, TX 75205
Phone: 866.765.4940—Fax: 214.520.0507
1):).
Ant=LNG TEctiNowais
For your Convenience, I have enclosed a draft agreement which details the terms.
We look forward to working with you and the City on this project. Again, thank you for
the opportunity.
At,
Kevin W. Markey •
VP of Operation
3001 Knox Street—Suite 401
Dallas, TX 75205
Phone: 866.765A940—Fax: 214320.0507