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HomeMy WebLinkAboutC11-366 Eagle Valley Clean Energy LOI EAGLE VALLEY CLEAN ENERGY, LLC October 14, 2011 Ken Whitehead Eagle County Solid Waste and Recycling 815 Ute Creek Road Wolcott, CO 81655 Dear Ken, Please accept this document as a non - binding Letter of Intent to express the interest that Eagle Valley Clean Energy, LLC ( "EVCE ") has in acquiring exclusive rights to the woody biomass waste referred to herein. Following are the basic terms and conditions under which EVCE would be interested in acquiring woody biomass waste from your company ( "Transferor "). These terms and conditions are negotiable and non - binding until accepted by all parties through incorporation into a formalized agreement that may be executed by the parties in the future. Subject Property The subject matter of the agreement will be Clean Biomass (as defined below) collected by Transferor at its facility in Wolcott and segregated and held for the exclusive use of EVCE. Based solely upon past history of Transferor, the anticipated Clean Biomass available to EVCE may be approximately 2,500 tons per year, however, Transferor will be under no obligation to make available any minimum amount of Clean Biomass per year, nor is Transferor under any obligation to clean or clear dirt or debris from the Clean Biomass. Transferor does not guarantee or warrant the suitability of the Clean Biomass for its intended purpose. Notwithstanding anything to the contrary herein, EVCE recognizes and agrees that Transferor shall be entitled to first use wood chips and/or other Clean Biomass for its own purposes in the operation of its Landfill and as may be required by Eagle County, from time to time before supplying the remaining Clean Biomass to EVCE, provided that Transferor agrees that it will not make available for sale to third parties any such wood chips or other Clean Biomass or any product derived therefrom . "Clean Biomass" means biomass fuel produced directly from natural, untreated plant fibrous biomass, including any of the following sources: all tree components, forestry/logging residues such as timber thinnings, wood waste residues such as slash, stumpage, bark, trimmings, sawdust, shavings, slabs, edgings, pulp screens, and urban wastes such as yard wastes, street and park maintenance, and grub residues." "Clean Biomass" does not include construction and demolition debris. Exclusive Rights and Term of Agreement Transferor will grant EVCE the exclusive right to take possession of and remove all Clean Biomass collected by the Transferor during the term of the agreement subject to the right of Transferor to use wood chips or other Clean Biomass for its own purposes in the operation of its Landfill and as may be required by Eagle County from time to time. The initial term of the agreement will commence on a date to be agreed between the parties that is presently anticipated to be mid 2013, and will end on the fifth (5 anniversary of that date, unless terminated earlier pursuant to the agreement. After the initial term, the agreement will automatically renew for up to three additional 5 year periods unless earlier terminated pursuant to the agreement. 1 611- Removal and Processing of Clean Biomass EVCE will agree to remove the Clean Biomass, at its own expense, on a frequency to be agreed between the parties, and anticipated to be based upon either a defined periodicity (e.g., at least once every 3 months) or at such times as the Transferor has accumulated a specified amount of segregated Clean Biomass. Unless otherwise agreed in writing between the parties, EVCE will be solely responsible for grinding or chipping the Clean Biomass. Payments between the Parties It is not anticipated that there will be any exchange of payments between EVCE and Transferor. The sole consideration for EVCE's rights to the Clean Biomass will be EVCE's agreement to remove the Clean Biomass at its sole cost and expense. Termination The agreement, which may be entered into by the parties, may be terminated by either party without cause by written notice to the other party of not less than 180 days or following an Event of Default. Events of Default Events of Default will include a bankruptcy or insolvency of a party to the agreement and any continuing and material breach of any obligation by a party under the agreement, following notice thereof and passing of a 60-day cure period. EVCE acknowledges that the Board of County Commissioners may change before a binding agreement is entered into by the parties and that such new Board may or may not agree to the preliminary terms set forth herein. This non - binding letter of intent shall expire on April 30, 2012 unless extended by written agreement of the parties. If you agree to the terms outlined above, please sign below and return a copy to us. Regards, Kendric Wait, Manager Eagle Valley Clean Energy, LLC Accepted and Agreed: EAGLE COUNTY, COLORADO By and through its Board +f County Commissioners By: .� AB Its: iiiMA Date: S 2