AGREEMENT
This Agreement made and entered into this 19th day of November, 2001,
by and between Xxxx Family Farms, L.L.C., a Kansas Limited Liability Company,
XX0, Xxxxxx, Xxxxxx, 00000, hereinafter referred to as "Grantor", and Western
Plains Energy, LLC, X.X. Xxx 000, Xxxxx, Xxxxxx 00000, hereinafter referred to
as "Grantee", is as follows:
WHEREAS, Grantors are the owners in fee simple, free and clear from any
mortgages, liens, or encumbrances, of the following described real estate
located in Xxxxxx County, Kansas, to wit:
THE SOUTHEAST QUARTER (SE1/4) OF SECTION TWENTY-SIX (26), TOWNSHIP TEN
(10) SOUTH, RANGE THIRTY-ONE (31) WEST OF THE 6TH P.M., AND
WHEREAS, Grantee is interested in the process of securing sources of
ground water with which to operate an ethanol plant which Grantee intends to
construct and operate, and
WHEREAS, the parties hereto intend by this agreement to allow Grantee
access to Grantor's above described property for the purposes of drilling and
equipping a water well and, upon completion and commencement of the operation of
the ethanol plant by Grantee, authorizing and permitting the Grantee to operate
said water well and transport the water pumped therefrom across Grantor's above
described property to Grantee's plant, and
WHEREAS, the parties acknowledge that the rights to the water are owned
and controlled by the State of Kansas and that it will be necessary that Grantee
secure from the Kansas Division of Water Resources the necessary water
appropriation and diversion rights.
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, the parties do agree as follows:
RIGHT TO CONSTRUCT
Grantor does hereby authorize and grant to the Grantee the right to
enter upon the above described property for the purposes of constructing a 16"
well, equipping, operating, maintaining, and repairing a water well and, upon
completion and commencement of the operation of said well, Grantor shall grant
to Grantee an easement upon and across the above described real estate for the
purposes of constructing, operating, maintaining, and repairing a water delivery
line from the well site to the Grantee's ethanol plant. The exact description of
the property to be encumbered by the easement shall be limited to ten (10) feet
on either side of the water delivery line. The easement shall be contained in a
separate agreement between the parties.
CONSIDERATION
As consideration for this agreement, Grantee agrees to pay to the
Grantor the sum of Fifteen Thousand Dollars ($15,000.00) in the following
manner: Seven Thousand Five Hundred Dollars ($7,500.00), cash in hand, the
receipt of which is hereby acknowledged, upon the execution of this agreement.
The balance of Seven Thousand Five Hundred Dollars ($7,500.00) to be paid at
least seven (7) days prior to the commencement of the drilling of the water well
by Grantee. Grantee shall have three (3) years from the date of this agreement
to pay the balance due and commence drilling. Failure to pay the remaining
amount due and to commence drilling of the well shall render this agreement null
and void with the Grantor entitled to retain the sums paid herewith as rent and
liquidated damages.
PAYMENTS CONTINGENT ON PUMPING
Grantee agrees to pay to Grantor upon commencement of the pumping of
the well and the diversion of the water to the plant site, the sum of Three
Hundred Fifty Dollars ($350.00) per
month in quarterly payments of One Thousand Fifty Dollars ($1,050.00) each
during the first fifteen (15) years. After the first fifteen (15) years of this
agreement, the pumping fee shall be renegotiated between the parties for
successive periods of five years during the balance of the term of this
agreement. If the parties cannot successfully renegotiate the pumping charges,
then, the parties shall submit the matter to arbitration by a single arbitrator
agreed upon by the parties. If the parties fail to agree on an arbitrator, the
Grantee shall apply to a court of competent jurisdiction for the naming of an
arbitrator. Payment shall be made in advance and shall be determined as rent.
TERM OF PUMPING AGREEMENT
The initial term of this pumping agreement shall be for a period of
twenty (20) years to begin with the commencement of the pumping and the
diversion of the water to the plant site. Provided, however, that this agreement
shall automatically renew for successive periods of five (5) years if no notice
of termination is given by Grantee to Grantor on or before sixty (60) days prior
to the expiration of this agreement or any renewal thereof. Notice shall be sent
to the last known address of the Grantor. The present addresses are as follows:
Xxxx Family Farms, L.L.C., 000 X.X. 00, Xxxxxx, Xxxxxx, 00000. Western Plains
Energy, L.L.C., X.X. Xxx 000, Xxxxx, Xxxxxx, 00000.
DIVISION OF WATER RESOURCES
It shall be the sole responsibility of Grantee to apply for and secure
from the State of Kansas Division of Water Resources the appropriate ground
water rights and to determine the point of diversion and quantity of water to be
pumped and to maintain and vest the same. Additionally, Grantee shall serve as
the water use correspondent for the purposes of the reporting of water usage to
the Division of Water Resources as may be required by law or administrative
regulation. Once the Grantee secures a water right from the State of Kansas,
Department of Agriculture, Division of Water Resources, the Grantee shall take
no action to cause the State of Kansas, Department of Agriculture, Division of
Water Resources, or its successor, to suspend, revoke or abandon the water
right. At the expiration of this agreement, or the termination of this
agreement, the ownership of the water rights shall revert to the Grantor, their
successor and/or assigns.
DAMAGES TO SURFACE
In addition to the consideration hereinbefore set out to be paid to the
Grantor, Grantee shall pay for all loss of crops and damages to the land
occasioned by its operations. This shall include but not be limited to preparing
of all pits and excavations to place the property in the same condition as it
was prior to the work by the Grantee, repair of all damages by reason of oil,
salt water, or other fluid resulting from the Grantee's operations, destruction
of crops, as a result of Grantee's ingress and egress to the well site or in
constructing, operating, maintaining or repairing the well and the water line
described herein.
EASEMENT
The parties hereto, upon drilling of the water well and placement of
the water line contemplated herein, do acknowledge that the appropriate easement
shall need to be prepared, executed and filed with the Xxxxxx County, Kansas,
Register of Deeds.
MAINTENANCE AND LIENS
It is understood and agreed to by the parties that Grantee shall use
all reasonable care to maintain the premises at all times during this agreement
in as good as condition as is possible, reasonable wear and tear excepted. In
addition, Grantee shall not permit any mortgages, mechanic's liens, or other
encumbrances to attach to or to become a lien against the Grantor's real
property. In addition, Grantee shall not remove any improvements that Grantee
places on Grantor's above described property or to allow those improvements to
be substantially altered without first obtaining the Grantor's written consent.
Grantee agrees to indemnify and hold Grantor harmless Grantor against all claims
and liabilities and will reimburse Grantor for any and all expenses incurred by
Grantor, either directly or indirectly, including reasonable attorney's fees, as
a result of any claims made by a third party against the Grantor as a result of
the Grantee's activities pursuant to this agreement, and as a result of any
intentional or negligent act on behalf of Grantee. Grantee understands and
agrees that Grantor has made no representations as to either the quantity or
quality of water which may be available under the described property. This
pumping agreement is to allow the Grantee access to the water in a "where is"
"as is" condition.
Grantor agrees to indemnify and hold harmless Grantee against all
claims and liabilities and will reimburse Grantee for any and all expenses
incurred by Grantee, either directly or indirectly, including reasonable
attorney's fees as a result by any claims made by third party against the
Grantee as a result of Grantor's activities pursuant to this agreement, and as a
result of any intentional or negligent act on behalf of Grantor.
DEFAULT
In the event of the failure of the Grantee to comply with the terms of
this agreement, Grantor shall give to Grantee notice that the Grantee has thirty
(30) days to cure the default. If the Grantee fails to cure the default pursuant
to the written notice, then, Grantor may declare this agreement null and void
and all money paid and improvements made hereunder shall be retained by Grantor
as rent and liquidated damages. Grantor shall not, in the event of default, have
the right to specific performance of this agreement.
TAXES
Grantee shall be responsible for the payment of any and all taxes and
assessments that may be levied or assessed against the above-described property
as a result of the addition of the improvements contemplated by this agreement
thereto.
FORCE MAJEURE
The parties understand and agree that neither the Grantor or the
Grantee shall be liable to the other for any failure or delay in performance of
any obligation under this agreement due to events beyond its reasonable control,
including fire, storm, flood, earthquake, explosion, acts of the public enemy,
war, acts of God, or acts or regulations or priorities of Federal, State or
Local Government.
BINDING AGREEMENT
This agreement shall extend to and be binding upon the heirs,
executors, administrators, successors, and assigns of the parties hereto.
SUCCESSION OF PAYMENTS
This agreement shall run with the above described real estate and
future payments hereunder shall be made to that person, or entity holding fee
simple title to the property, or in the event of a reservation of the payments,
to others as designated in writing and delivered to Grantee, by the person,
persons or entity holding right to payment. Grantor, or any successor or assign
of the Grantor, may also designate in writing and deliver to the Grantee a
document directing the Grantee to make the payment to a third party.
RELATIONSHIP OF THE PARTIES
By the execution of this agreement, the parties intend to create no
other relationship other than that as set forth in this agreement. Specifically,
there is no agency, partnership, joint venture
or other joint or mutual enterprise or undertaking created hereby. Nothing
contained within this agreement authorizes one party to act for or on behalf of
the other and neither party is entitled to any commissions or other
considerations other than that as is set forth specifically herein.
LIMITATION OF RIGHTS
This agreement does not grant to the Grantee access to any domestic
water rights held by the Grantor. Grantee shall take no action to impair the
domestic water rights of the Grantor.
ASSIGNMENT
It is understood and agreed by and between the parties that Grantee may
not assign its rights under this agreement without first obtaining the written
approval of the Grantor. Said approval by Grantor shall not be unreasonably
withheld. Grantor may sell, lease, or otherwise assign its rights to the above
captioned real estate, as well as this contract, without approval of the
Grantee.
GOVERNING LAW
This agreement shall be governed, construed and enforced under the laws
of the State of Kansas.
ENTIRE AGREEMENT AND AMENDMENT
This agreement contains the entire agreement between the parties. No
oral statements, representations or prior written matter not contained in this
agreement shall be binding upon the parties. This agreement shall not be amended
or modified in any manner except by a writing executed by both parties.
IN WITNESS WHEREOF, the parties have caused this agreement to be
executed the day and year first above written.
WESTERN PLAINS ENERGY, L.L.C. HAYS FAMILY FARMS, L.L.C.
By: /s/ Xxxx Xxxxxxxx /s/ Xxxxx Xxxx
-------------------------------- ------------------------------------
Title: Chief Financial Officer Xxxxx Xxxx
X.X. Xxx 000 XX 0
Xxxxx, Xxxxxx 00000 Xxxxxx, Xxxxxx 00000
Grantee /s/ Xxxx Xxxx
------------------------------------
Xxxx Xxxx
XX 0
Xxxxxx, Xxxxxx 00000
Grantor
ACKNOWLEDGMENT
STATE OF KANSAS, COUNTY OF XXXX, XX:
BE IT REMEMBERED, that on this 20th day of November, 2001, before me,
the undersigned, a notary public in and for the county and State aforesaid came
Xxxx Xxxxxxxx, CFO, of Western Plains Energy, LLC, a corporation duly organized,
incorporated and existing under and by virtue of the laws of Kansas, who is
personally known to me to be the same person who executed the within instrument
of writing and such person duly acknowledged the execution of the same to be the
act and deed of said corporation.
IN TESTIMONY WHEREOF, I have hereunto set my hand, and affixed my
official seal the day and year last above-mentioned.
/s/ Xxxxx X. Xxxx
------------------------------------
Notary Public
My term expires: 11-29-2001
ACKNOWLEDGEMENT
STATE OF KANSAS, COUNTY OF XXXXX, XX:
BE IT REMEMBERED, that on this 19th day of November, 2001, before me,
the undersigned, a Notary Public within and for the County and State aforesaid,
came Xxxxx Xxxx and Xxxx Xxxx, husband and wife, who are personally known to me
to be the same persons who executed the above Agreement and such persons duly
acknowledged the execution of the same.
IN TESTIMONY WHEREOF, I have hereunto set my hand and seal the day and
year first above written.
/s/ Xxxx Xxxxxx
------------------------------------
Notary Public
My term expires: 8/20/04
