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Case 6:16-cv-01199-AA

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Engineering Procurement and Construction Agreement
THIS ENGINEERING PROCUREMENT AND CONSTRUCTION AGREEMENT
("Agreement") is made as of the 22 day of April, 2012 (the "Effective Date"), by and between
JC-Biomethane, LLC ("Owner" or "Purchaser"), an Oregon limited liability company, and entec
biogas gmbh, an Austrian
("Contractor").
RECITALS
WHEREAS, Owner wishes to engage Contractor to provide general contractor services in
the design, construction, and performance of start-up and testing of Owner's 1.6 MW biogas
energy facility in JlUlction City, Oregon (the "Facility");
WHEREAS, Contractor designs, constructs and installs biogas energy projects and as
such is able to engineer and construct the Facility and all the necessary ancillary systems to
generate electricity at the Facility;
WHEREAS, the parties agree that Contractor will provide the Services to Owner on the
terms and conditions set forth in this Agreement;
WHEREAS, Owner intends to fmance the development of the Facility through
Caterpillar Financial Services Corporation (the "Lender").
THEREFORE, In consideration of the agreements and covenants herein contained,
Owner and Contractor, intending to be legally bound, hereby mutually covenant and agree as
follows:
LIST OF SCHEDULES
Schedule 1:

Description of Works

Schedule 2:

Master Schedule ofValues

Schedule 3:

Project Construction Schedule

Schedule 4:

Mechanical Completion and Certificate

Schedule 5:

Substantial Completion and Certificate

Schedule 6:

Final Completion and Certification

Schedule 7:

Performance Guarantee

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Exhibit A
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AGREEMENT
·1.
Term. The term of this Agreement shall be a period commencing on the Effective Date
and tenninating upon final completion of the Facility, unless earlier terminated as herein
provided. Owner may, in its sole discretion, at any time, with or without cause, terminate this
Agreement, by giving Contractor thirty (30) days prior written notice of such termination.
2.
Services. The Services to be performed by Contractor shall consist of those services and
the project as set forth in the attached Schedule 1. Contractor shall devote to the performance of
the Services no less than the full number of qualified personnel, whether direct employees of
Contractor or subcontractors, necessary to complete the Services in a professional and
expeditious manner and in accordance with Schedule 1.
3.
Compensation and Payment. Owner shall pay Contractor for services performed or
insure that Lender makes such payments to Contractor. It is estimated that Contractor shall be
paid approximately $9.2 million US dollars for the Services. Owner shall pay Contractor for
performance of the Services on a monthly basis pursuant to Schedule 2. Owner shall make such
payments within fifteen (15) days but not exceeding twenty·one (21) days of receipt of invoice
for the Services. In the event of termination of this Agreement, provided Contractor is not in
default of this Agreement, Owner shall pay Contractor, as payment in full, for the Services
properly performed and invoiced by Contractor from the Effective Date through the date of
termination for which payment has not then already been made. Notwithstanding the payments,
Contractor shall provide to Owner a bi-weekly update of Contractor's work progress in a form
acceptable to Owner.
4.
Performance and Payment Bonds. Owner shall have the right to require Contractor to
furnish bonds covering faithful performance of the Agreement and payment of obligations
arising there under in form and substance acceptable to Owner. The bonds must name Owner and
Lender as dual obliges, and provide for Lender's right to full subrogation to Owner's rights,
together with such other assurances and endorsements as Lender may require.
5.
Form oflnvoices for Payment. Contractor shall provide monthly invoices in form set out
in AlA Document G702 and G703, Application and Certificate for Payment, which requires
Contractor to itemize:

The status of the contract sum to date, including the total dollar amount of the work
completed;

The amount of the retainage (based on 5 percent as noted in Section 4);

The total previously invoiced payments;

A summary ofthe change orders (if any);

The amount of the invoice currently being requested.

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Exhibit A
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In addition, as part of invoicing, Contractor shall provide:

• A monthly report, in a form acceptable to Owner, of progress with progress photos and
any update in the project construction schedule as presented in Schedule 3;
• A conditional lien waiver for the payments received in the prior invoice period.
6.
Compensation Retention. Owner shall withhold five (5) percent of compensation for
each invoice of payment to be released after receipt of the Final Completion Certificate as further
described in Schedules 4, 5, and 6 and Section 8 below.
7.
Completion Certificates.
Contractor shall provide certificates of completion for
mechanical, substantial and final completion of the Facility. Mechanical completion shall be the
date when the Facility has been built to all drawings and specifications and is ready to be tested
and commissioned as described in Schedule 4. Substantial completion shall be the date when the
Facility (1) has been successfully tested and commissioned such that the Facility has achieved
commercial operation, (2) is generating the specified electrical output specified in Schedule 5
and (3) is supplying power to the electric utility/off-taker in accordance with the terms of the
Power Purchase Agreement between Owner and PGE. Final completion shall be the date when
all punch list items have been completed and must be agreed upon by Contractor, Owner and
Lender as described in Schedule 6.
8.
Warranties. Contractor covenants and warrants that the Services will be performed by
Contractor in a professional manner in accordance with the level of care and skill ordinarily
exercised by professionals in the field currently practicing under similar conditions and in
accordance with all applicable federal, state, county and other local laws and regulations.
Contractor further covenants and warrants that the materials and equipment furnished under the
Agreement will be of good quality, new, and free of defects. Contractor further covenants and
warrants the performance guarantees in Schedule 7.

l

9.
Consent to Modifications. Owner must provide written consent to any change orders,
changes to the project construction schedule, changes to estimated overall compensation or any
other changes to the Agreement. Contractor understands that Owner will be required to secure
consent from Lender to be able to provide such written consent pursuant to this Section 9.
10.

Confidentiality.

a.
Contractor shall not disclose any trade secrets, confidential proprietary
information, or any of its findings, investigation reports, whether preliminary or final or any
other matter relating to the Services to be performed hereunder (collectively, the "Confidential
Information"), except such Confidential Information (i) which is required by any subpoena, court
order or otherwise as required by law, provided that Contractor shall notify Owner and shall first
avail itself of all appropriate defenses against any disclosure, or (ii) the disclosure of which is
consented to in writing by the party to which the Confidential Information relates.

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Exhibit A
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b.
The parties hereto mutually and expressly agree that all work product produced
pursuant to this Agreement is Confidential Information and is the sole property of Owner for this
particular facility only.
11.

Indemnity.

a.
Contractor shall indemnify, defend and hold harmless Owner and its subsidiaries
and the members, officers, agents, and employees of all of them (all of which are included in the
term "Owner") from and against any and all demands, actions, judgments, liability, expenses
(including defense costs and legal fees) and claims for damages of any nature whatsoever (all of
the foregoing are collectively referred to herein as "Claims" and individually as a "Claim"),
arising out of or in connection with the performance of any of the Services and/or any act or
omission by Contractor or any or its employees, agents, representatives or subcontractors and
regardless of comparative fault, including without limitation, any Claims on account of (1)
bodily injury, death or personal injury of a person or for damage to or loss of use of property
(including property of Owner), except as to Owner, its officers, agents and employees
negligence, and (2) Owner's reliance upon or use of any work performed pursuant to the
Agreement or data or other information provided or delivered by Contractor pursuant to the
Agreement.
b.
Owner shall indemnify the Contractor against all claims, damages, and costs
arising from termination of placed orders.
c.
The provisions of this Section 5 and Contractor and Owner's obligations
hereunder shall survive the expiration or sooner termination of the Agreement and final payment
thereunder.
d.
The indemnification provided for herein is in addition to any other rights or
remedies which Owner or Contractor may have under the law or under the Agreement. In the
event any claim or demand is made against any party which is entitled to be indemnified
hereunder, Owner may, at its sole discretion, reserve, retain, or apply any monies due Contractor
under this Agreement for the purpose of resolving' such claims or Owner may condition release
of any monies due to Contractor on Contractor providing Owner with assurance of protection of
Owner's interest which is acceptable to Owner. Owner shall, at its reasonable discretion,
determine whether such assurance is acceptable.

12.
Step in Rights of Lender. Contractor is hereby notified that Lender shall provide a loan
to Owner for construction of the Facility. Contractor agrees that if Lender notifies Contractor in
writing that, pursuant to and in accordance with the loan documentation between Owner and
Lender, that Lender has acquired Owner's right, title and interest to the Facility, then Contractor
shall recognize Lender as its counterparty under this Agreement, and shall continue to perform
its obligations under this Agreement. Contractor further agrees that if Owner is in breach or
default under this Agreement, Contractor shall not terminate or suspend its performance under
this Agreement until it first gives written notice of such breach or default to Lender and afford
Lender a period of at least 60 days from receipt of such notice to cure such breach or default.

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Exhibit A
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13.
Notices. All notices permitted or required under this Agreement shall be in writing and
shall be by personal delivery, nationally recognized overnight courier service, facsimile
transmission or by certified or registered mail, return receipt requested, and shall be deemed
given (i) upon personal delivery to the party to be notified; whether by hand delivery or by
courier; (ii) upon receipt of a confirmed facsimile; or (iii) three (3) days after deposit in the mail,
postage prepaid and, in any case, addressed to the party to be notified at the address or facsimile
number indicated below, or at such other address or number as such party may designate by
advance written notice to the other party.
To Contractor

Attn: Brigitte Maier
entec biogas gmbh
Schilfweg 1
6972 Fussach Austria

To Owner:

Attn: Dean Foor
JC-Biomethane, LLC.
1328 W 2nd Ave
Eugene, OR 97402

14.
Relationship of the Parties. Neither party hereto will be deemed the agent or legal
representative of the other for any purpose whatsoever and each party will act as an independent
contractor with regard to the other in its performance under this Agreement. Nothing herein will
authorize either party to create any obligation or responsibility whatsoever, express or implied,
on behalf of the other or to bind the other in any manner, or to make any representation,
commitment or warranty on behalf of the other.
15.
Survival of Obligations. Obligations of the parties under this Agreement shall survive
any termination or suspension of the Services or the expiration or termination of this Agreement,
and shall also survive final payment.
16.
Entire Agreement. This Agreement, together with the Schedules appended to the
Agreement constitute the entire agreement between the parties with respect to the Services and
supersedes all prior negotiations, representations or agreement relating thereto, written or oral,
except to the extent they are expressly incorporated herein. Unless otherwise provided for
herein, no amendments, changes, alterations or modifications of this Agreement shall be
effective against either party unless in writing signed by both Owner and Contractor. Each of the
parties has been involved in determining the provisions of this Agreement, and no ambiguity in
or interpretation of this Agreement or any of its provisions shall be construed more strongly
against either party regardless of who is responsible for its preparation.

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Exhibit A
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General Provisions.

a.
Gender and Number. Whenever the masculine or feminine is used herein, it shall
be deemed to include the other. The neuter shall include the masculine or the feminine or both,
as appropriate. The plural shall include the singular and the singular, the plural, whenever the
context so admits.
b.
Governing Law. This Agreement and the legal relations of the parties hereto shall
be governed by the laws of the State of Oregon. Both parties agree to exclusive forum and venue
in the state and federal courts located in Eugene, Oregon.
c.
Captions. Headings of particular Sections are inserted only for convenience and
are in no way to be construed to be a part of this Agreement or as a limitation of the scope of the
sections to which they refer.
d.
Severability. The invalidity or unenforceability of any particular provision or
term of this Agreement shall not invalidate or otherwise affect in any way offset the other
provisions hereof and the Agreement shall be construed in all respects as if such invalid or
unenforceable provisions were omitted.
e.
Waiver. No waiver of the terms, conditions and covenants of this Agreement shall
be binding and effective unless the same shall be in writing signed by the parties hereto. A
waiver of any breach of the terms, conditions and covenants of this Agreement shall be for that
one time only and not for any subsequent breach.
f.
Counterparts; Facsimile. This Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which together will constitute
one and the same instrument. Delivery of an executed signature page to this Agreement by
facsimile transmission shall be as effective as delivery of a manually signed counterpart hereof.
18.
Drawings. All designs, renderings, plans, drawings, specifications and for this particular
facility (collectively "Rights") shall be and remain the sole and exclusive property of Owner
from inception. Regardless of any dispute regarding this Agreement, upon Owner's request,
Contractor shall deliver the copies of all designs, renderings, plans, drawings, and specifications
to Owner.
19.
Intellectual Property. Entire drawings, sketches, calculations, documents and information
which have been and will be supplied (the "Documents") are the intellectual property of
Contractor and will remain in the copyright of Contractor. The Owner is allowed to use the
Documents only with written permission from Contractor.

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Exhibit A
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.

Name: Dean Foor
Title: CEO
Date:

?t!--tt-d

20-{2-

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Exhibit A
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Absender:
Mr
Dean C. Foor
Essential Consulting Oregon (EC Oregon)
Junction City
Eugene 97402
UNITED STATES
Tel: 00 I 541 I 4859095-00 I 541 4859095
Mobil: +I 541 55 68142
E-Mail: dean@ecoregon.com

E-Mail Eingang (192831)- Mittwoch, 12. Februar 2014

erledigt

Verantwortlich:
Bernhard Menne!
Erstellt:
12.02.2014 20:12:36 von: Extern (dean@ecoregon.com)
Datum: Mittwoch, 12. Februar 2014
Projekt: keines
E-Mail Empfllnger: TO: s.schmoranzer@ormatic.de
CC: b.mennel@entec-biogas.at
Kontakt: Essential Consulting Oregon (EC Oregon), Eugene, Foor Dean C.

RE: can we speak?
Stefan,
General Electric (GE) indicates that Ormatic and thus Entec as the GC are in violation of international software laws. Together you
cooperated to install unlicensed copies of software on JC-Biomethane's HMI. Further the code is written in German-lish and in a
manner to intentionally create dependency and with a multitude of relic code.
Can either you or Mr. Mennel explain this?
Dean Foor

Exhibit B
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Registration Number

*-APPLICATION-*

Title
Title of Work:

Automated Controls System Software for Junction City

Completion/Publication
Year of Completion:
Date of 1st Publication:
Nation of I 51 Publication:

2013
September 24, 2013
United States

Author
Author:
Author Ct·eated:
Work made fm· bire:
Citizen of:
Domiciled in:

ORmatiC GmbH
computer program
Yes
Gennany
Gem1any

Copyright Claimant
Copyright Claimant:
Transfer statement:

Sparkasse Bregenz Bank AG
Sparkassenplatz 1, 6900 Bregenz, Austria
By written agreement

Certification
Name:
Date:
Applicant's Tracking Number:

MATTHEW P. WARENZAK
June 09, 2016
034681.001

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Exhibit C
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