CBEC RAILWAY INC. (CBEC)
INDUSTRIAL TRACK AGREEMENT
THIS AGREEMENT, made and entered into this 18th day of June, 2008 by and
between the CBEC RAILWAY INC., an Iowa corporation, (hereinafter called the
"Company") and SOUTHWEST IOWA RENEWABLE ENERGY, LLC, (hereinafter called the
"Industry").
WITNESSETH:
WHEREAS, the Industry desires the maintenance and operation of track to
serve the Industry and be located near Council Bluffs, Iowa, as shown on the map
which is to be attached hereto, made a part hereof and marked Exhibit "A"
("Industry Track"); and
WHEREAS, the Company is willing that said Industry Track shall be
maintained and operated upon the terms and conditions herein set forth;
NOW THEREFORE, in consideration of the premises, it is hereby agreed
between the parties hereto as follows:
1. RIGHT OF WAY AND PUBLIC AUTHORITY AND AUTHORITY AND ASSESSMENTS. The
Industry shall (i) procure and furnish, without expense to the Company, all
necessary rights of way, including all necessary authority and permission,
public or private, for the maintenance and operation of the Industry Track, and
(ii) timely pay (A) all compensation and assessments required at any time by any
municipality, governmental agency, or person for the privilege of maintaining
and operating said track, and (B) all special assessments, taxes and the cost of
or related to or resulting from an and all public improvements, levied or made
against, upon, or on account of the Industry Track.
2. RAIL SWITCH CONSTRUCTION AND MAINTENANCE. Industry shall construct a
point of access rail switch ("Rail Switch") depicted as Point "A" on Exhibit "A"
at its sole cost in compliance with Company's material specifications and must
be installed during a time-period and duration approved by Company, which
approval shall not be unreasonably withheld, delayed, or conditioned provided
that requiring 'expedited construction' during time windows that do not delay
rail traffic over Company's line shall not be considered unreasonable. Any costs
associated with installation and ongoing inspection and maintenance of Rail
Switch shall be borne by Industry. Further, Industry shall be responsible for
obtaining permission and compliance with any requirements from any third parties
required for the construction and maintenance of the Rail Switch and shall
indemnify and hold Company harmless for any failures to do so. Company may, at
its sole option, and at Industry's expense, provide maintenance to the Rail
Switch should the Company deem this switch to be insufficiently maintained by
Industry. Any ongoing maintenance performed on this Rail Switch must also be
performed during a time period and duration approved by Company. Failing to
comply with the point of access rail switch provisions shall be considered a
material default of this Agreement by Industry. The term "maintenance," as used
in this Section, is intended to and shall include, repairs to the Rail Switch
and the removal of snow, ice, weeds, and other obstructions therefrom, each in
accordance with Association of American of Railroads ("AAR"), Federal Railroad
Administration ("FRA") and state and local standards.
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3. INDUSTRY TRACK MAINTENANCE. The Industry shall bear and pay the cost
and expense of maintenance of the Industry Track in accordance with AAR, FRA and
state and local standards. The term "maintenance", as used in this Section, is
intended to and shall include, in addition to repairs, all additions,
betterments, and changes to the Industry Track, and the removal of snow, ice,
weeds, and other obstructions therefrom. The necessity for such maintenance
shall be determined by the Company. In addition, the Company or its agent
reserves the right to install, maintain, and operate such derails, signals, and
other safety devices (wheresoever located) and to employ such flagmen or other
employees, as in its sole judgment may be necessary to assure safe operation of
the Industry Track, or as may be required by public authority, and the Industry
agrees to pay to the Company or its agent the cost and expense thereof.
4. CHANGES AND ADDITIONS. The Company shall bear and pay the cost and
expense of all future changes in the Industry Track rendered necessary by
changes in the Company's other tracks, property, or operating requirements. The
Industry shall bear and pay the cost and expense of all future changes in, or
additions to, all tracks and property, regardless of the ownership thereof, and
also of all construction, made necessary by the maintenance or operation of the
Industry Track or any changes thereto. This paragraph shall apply to
electrification, track elevation or depressions, and grade separation, as well
as any other repairs, additions, betterments, or changes whatsoever.
5. PAYMENT IN ADVANCE FOR ITEMS TO BE FURNISHED BY THE COMPANY. (Not
applicable)
6. SERVICE. The Company or its agent shall, during the period this
Agreement is in effect, deliver upon the Industry Track all freight in carload
lots consigned to the Industry, and shall place thereupon cars for loading and
unloading of freight in carload lots by the Industry. All such service to be
performed is subject to applicable legal requirements and in conformity with
applicable rates, rules, and regulations.
7. OBSTRUCTIONS AND CLEARANCES, CHANGES AND OPERATING RULES. The Industry
shall not place, or peunit to be placed, any equipment, material, structure,
pole, or other obstruction, or any excavation within 9.0 feet, on straight track
or 10.5 feet on curved track, laterally distant of the track centerline, or
within 23 feet vertically from the top of the rail of the Industry Track. The
Company's knowledge of any obstruction and the Company's or its agent's
continued operation on the Industry Track shall not constitute a waiver of this
covenant. Industry shall hereaftero comply with any new legal or reasonable
operating requirements regarding clearances. The Industry shall observe and
comply with all applicable rules and regulations concerning use and operation of
the Industry Track and the loading, unloading, and movement of cars thereupon.
8. USE OF THE TRACK. The Company shall not have the right to use the
Industry Track, and any extension thereof, for any purpose unless Industry
consents to such use in writing. In the event such use by Company is permitted,
Company shall be responsible for all damage to the Industry Track and any othero
damage to persons or property occasioned by such use of the Industry Track.
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9. FIRE INDEMNITY CLAUSE. It is commonly understood that the movement of
railroad locomotives involves some risk of fire. The Industry assumes all
responsibility for, and agrees to indemnify the Company against, loss or damage
to Industry property or to property upon its premises, arising from fire caused
by locomotives operating on the Industry Track, or in its vicinity for the
purpose of serving said Industry.
10. GENERAL INDEMNITY CLAUSE. The Industry agrees to indemnify, and hold
harmless, the Company for loss, damage, or injury from any act or omission of
the Industry, its employees, or agents, to the person or property of the parties
hereto and their employees, and to the person or property of any other person or
corporation, in connection with or resulting from Industry's performance of or
failure to perform its obligations hereunder.
11. ENVIRONMENTAL AND OCCUPATIONAL INDEMNITY CLAUSE. Notwithstanding
anything herein to the contrary, Industry agrees that in the maintenance of the
Industry Track, it will comply with applicable laws, including, but not limited
to, any laws, standards, regulations, or permit requirements relating to
environmental pollution or contamination, or to occupational health and safety;
Industry agrees to indemnify and hold harmless the Company for any and all
claims, demands, lawsuits, or liability for loss, fines, damage, injury, and
death and all expenses and costs, including attorneys' fees, resulting from, or
arising out of, the maintenance of the Industry Track, including any discharge
or emission therefrom or for the violation of any law, standard, regulation, or
permit requirement relating to environmental pollution or contamination or to
occupational health and safety.
12. END CLEARANCE. Intentionally omitted.
13. COMPANY MAY TERMINATE. The Company shall have the right, at its option,
to terminate this Agreement, and thereaftero, at any time, at the expense of the
Industry, disconnect the Industry Track and take up and remove all or any part
thereof owned by the Company (including and restoration of the property upon
which same is located to its former condition), if the Industry shall (i)
discontinue the use of the Industry Track, (ii) make any assignment of rights
hereunder without the Company's written consent, (iii) fail to pay when due any
amount owing to the Company under this Agreement, or (iv) fail or refuse to
perform any other obligation herein, on the part of the Industry to be kept or
performed following written notice of such failure from Company to Industry
providing Industry a reasonable opportunity to cure same.
14. OWNERSHIP AND PAYMENT OF SALVAGE. The Company shall own Industry Track
extending from point lettered "A" to point lettered "B", located on its right of
way, (however, the Industry shall have salvage equity, and the Industry shall
own track extending from point lettered "B" to point lettered "C". as shown on
said Exhibit "A"). Upon the termination of this Agreement, the Industry shall,
at the option of the Company, pay the cost and expense of removing the Industry
Track owned by the Company and restoring the Company's tracks and property and
public property to the condition in which it would have been had not said track
been constructed. (At the election of the Industry, the Company shall pay to the
Industry the salvage value of usable material paid for by the Industry in that
part of the Industry Track owned by the Company (less fifteen percent (15%)
thereof to defray the cost of
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transportation and handling) or deliver said material to the Industry, unless
the Industry no longer has any equity interest in that part of the Industry
Track).
15. ASSIGNMENT. The Industry shall not assign this Agreement or any
interest therein, without the written consent of the Company except to an
affiliate of Industry or to any financial institution(s) as collateral security
for any financing provided to Industry. Subject to the above limitation and
exceptions, this Agreement shall be binding upon the respective parties, and
their respective heirs, executors, administrators, successors, and assigns.
16. PERFORMANCE. In the event any of the terms or provisions of this
Agreement have been carried out or performed prior to the date of execution
hereof, it is understood and agreed that this Agreement shall nevertheless be of
the same force and effect as though same had been executed by the parties prior
to such performance.
17. FORCE MAJEURE. The Company or its agent shall not be obligated to
operate on the Industry Track if it shall be prevented or hindered from doing so
by acts of God, public authority, strikes, riots, terrorism, laboro disputes, or
any cause beyond its control.
18. INTEREST OF COMPANY. This Agreement shall inure to the benefit of, and
be binding upon (i) the parties hereto, (ii) the successors and assigns of the
parties hereto, and (iii) the person, firm, partnership, or corporation other
than the Company that may be duly designated by the Company or future owner of
the Company's lines of railroad and Industry Track as the one (1) sole operator
designated to conduct freight operations over the Company's lines of railroad
and the Industry Track.
19. SUBORDINATION. (Intentionally Left Blank)
20. GOVERNING LAW AND PERFORMANCE. This Agreement shall be performed by the
parties in Council Bluffs, Pottawattamie County, Iowa. In the event the Industry
is non-resident of the State of Iowa, said performance of this Agreement shall
be deemed as doing business in Iowa, shall be deemed to constitute the
appointment of the Secretary of State of Iowa to be said non-resident's true and
lawful attorney upon whom may be served process in accordance with applicable
law and any process or original notice served under such law shall be of the
same legal force and effect as of served personally upon the Industry within the
State of Iowa. The parties intend this Agreement to be executed in, and
interpreted, construed and enforced in accordance with the laws of the State of
Iowa.
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IN WITNESS WHEREOF, the parties hereto have caused this agreement to be
executed as of the day and year herein above stated.
CBEC RAILWAY INC.
ATTEST: By: /s/ Xxxxxxx Xxxxxx
-------------------------------------
/s/ Xxxx X. Xxxxxxxx Title: Vice President, CBEC Railway, Inc.
----------------------------------- ----------------------------------
Secretary
SOUTHWEST IOWA RENEWABLE ENERGY, LLC
ATTEST: By: /s/ Xxxx Xxxxx
-------------------------------------
/s/ Xxxxx Xxxxxxx Title: President & CEO
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Secretary
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