Exhibit 10.75
Registered at
Administration
_____________ area
Khabarovsk Territory
"__" ________, 200_ No.
TIMBER LEASE AGREEMENT
X. Xxxxxxxx "20" September 2000
1. SUBJECTS OF THE AGREEMENT
The owner of the concession - Kerbinskiy leskhoz in person of its director
Xxxxxx Xxxxxxx Xxxxxxxxxxxx in accordance with the provisions about leskhozes
hereinafter the "Lessor" and JSC "Forest-Starma" in person of General Director
Xxxxx X. Xxxxxxx acting in accordance with the Charter have entered into this
agreement about lease of a the concession.
2. OBJECT OF LEASE, TYPES AND FELLING VOLUMES
2.1. The object of lease is a forest area in the third grade group forests in
compartments #153,154,163,166-182,184-191,194-200,215-222,224,227-232,
244-247,204-210, 251-258,263,265-269,286-289,292-300,303-305,312-315,
323-344,364-401,410,439-444,472-511,536-539,944,945,948 of Herpuchinskiy
Forestry at the area of 194,3 thousand hectares with inventory of mature
and overmature stand of 13324 thousand cubic meters.
2.2. The concession is given to the Lessee for logs felling.
2.3. The fixed felling volume is - thousand cubic meters in the first grade
group forests and 180 thousand cubic meters in the third grade group
forests.
2.4. If necessary the felling volume can be changed by common consent of the
lessee and Lessor.
3. LEASE TERMS
The agreement is effective within 25 years from September 15, 2000 -
September 15, 2025.
4. RIGHTS AND LIABILITIES OF THE LESSOR (LESKHOZ)
4.1. The Lessor has the right:
4.1.1. To make proposals concerning revision of this agreement.
4.1.2. To give on lease or under any other conditions the same forest areas of
the concession with the attendant forest resources simultaneously to
different forest users to provide multipurpose use of forest in the
event this does not contradict the rights and liabilities stipulated by
this agreement.
4.1.3. To perform control over the condition, use, protection of forests,
compliance with effective Forest Law, norms and regulations of forest
use.
4.1.4. To accomplish all kinds of forestry works including tending felling and
salvage felling within the leased concession in the event the lessee is
unable to accomplish these works.
4.1.5. To make claims against the lessee for penalties recovered for
violation of forestry requirements while felling timber on stem and
damage injured to forestry as a result of economic activities of the
lessee.
4.1.6. To obtain from the lessee informational and other materials about usage,
regeneration, protection of forests.
4.1.7. If operations done by the forest users negatively affect the forests
regeneration, the Lessor will stop these operations until the violations
are eliminated.
4.1.8. To confiscate for the government needs in cases stipulated by the
effective legislation the leased areas with obligatory compensation of
caused financial loss as agreed with the lessee.
4.1.9. To involve the lessee in accordance with the decision of the local
administration into forest fires suppression activities.
4.2. The Lessor undertakes the following obligations:
4.2.1. To perform control over the lessee's activities connected with
accomplishment of forestry and forest regeneration activities in the
given concession.
4.2.2. To record forest cadastre, dynamics of the concession and make timely
amendments thereto.
4.2.3. To provide forest management and inventory activities.
4.2.4. To provide the lessee for temporary use with the materials required for
the correct accomplishment of the forestry activities.
4.2.5. To provide the lessee at his expense with the required forest forestry
materials.
4.2.6. To perform the annual forest areas' marking out and taxation, to
provide the lessee with felling permits.
4.2.7. Inspection of felling areas.
4.2.8. To perform and finance forest pathological supervision over the leased
concession.
4.2.9. To provide aviation forest protection on the territory of the
concession.
4.2.10. To timely finance forestry and forest regeneration activities.
4.2.11. To advance forestry and forest regeneration activities in amount of
50 percent of expenses needed for their accomplishment.
4.2.12. To coordinate with the lessee the location of forestry and production
facilities, landings, logging roads, parking areas, improvement of the
territory necessary for organization and performance of felling.
4.2.13. In case the forests lose the quality and/or forest resources are lost
due to drying of forest massifs, forest fires, the Lessor will
completely reimburse forest resources and losses done to the lessee
connected with their development.
4.2.14. To render methodological assistant in selection of ways and methods of
regeneration of felled areas, to draw up the projects of forest
cultures, to
provide the lessee on a contract basis with plants for the production
of forest cultures.
4.2.15. To provide the lessee if necessary on a contract basis with logging and
regeneration equipment.
4.2.16. To reimburse to the lessee losses connected with suppression of forest
fires, occurred through no fault of his.
4.2.17. To reimburse in accordance with decision of the court the losses done
to the lessee as a result of illegal suspension of its economic
activities.
5. RIGHTS AND LIABILITIES OF THE LEASEHOLDER
5.1. The lessee has the right:
5.1.1. To conduct felling within the bounds of the leased forest area in
accordance with the conditions stipulated by this agreement and
normative documents.
5.1.2. To build roads, temporary production and economic objects, housings and
other buildings at the leased territory connected with the use of the
concession in compliance with the Lessor.
5.1.3. To select independently the form of economic activity concerning the use
of the concession, to use forest products and income received as a
result of lease of the concession.
5.1.4. To make proposals concerning amendment of conditions of the agreement.
5.1.5. To conduct all kinds of main and intermediate felling while leasing
concession.
5.1.6. To fix pay and receive reimbursement of expenses made by the lessee at
the territory of the leased concession while constructing buildings,
roads, etc. in case they will be used for other purposes besides the
lessee's purposes.
5.1.7. To participate in inspections made by the Lessor of the leased
concession for the appraisal of its condition, compliance with the
effective Forest Law, regulations of forest use and conditions of the
agreement.
5.1.8. To use the materials available at the Lessor concerning condition, use
and protection of the forests of the leased territory.
5.1.9. Preferential right for receipt of limits of felling area under
available capacities within the calculated felling area.
5.1.10. To demand termination of the agreement and reimbursement of losses in
case the Lessor violates the conditions of this agreement.
5.1.11. To defend the interests in court and arbitration in case they are
violated by the Lessor.
5.2. The lessee undertakes the following obligations:
5.2.1. To perform the conditions at the leased forest area in compliance with
the effective Forest Law, regulations and manuals concerning forestry
management.
5.2.2. To follow the rules of fire security and perform anti-fire activities
within the felling areas.
5.2.3. To provide accomplishment of forestry and forest regeneration activities
and other conditions in accordance with the annually signed agreement
by the Lessor.
5.2.4. At the felling sites where understorey trees which provide forest
regeneration are destructed as a result of economic activities of the
lessee to regenerate forests at the lessee's account.
5.2.5. To perform tending the forest cultures before they are transferred in
the category of forest-clad areas at the Lessor's expense.
5.2.6. After finishing logging operations to turn over forest areas of the
concession to the owner.
5.2.7. To provide the Lessor with information necessary for inventory of the
concession and calculating of rental charge as well as other
information about use of the concession.
5.2.8. To pay for use of forest concession timely and in compliance with the
procedure.
5.2.9. To follow the instructions of the Lessor concerning revealing of
violations in accordance with the effective Forest Law within the
indicated timeframes.
5.2.10. To have a five-year felling plan and an ecological passport of the
company.
5.2.11. To present for the Lessor's acceptance the finished forestry objects
and operations.
5.2.12. To assist in forestry and forest inventory activities.
5.2.13. To fulfill other requirements made by the rules and provisions for
forestry.
6. PAYMENTS FOR FOREST RESOURCES
6.1. Rental charge is annually fixed on the base of calculating area of
felling and paid out in accordance with the procedure.
7. LIABILITY OF THE PARTIES
7.1. The lessee is liable for violation of the effective Forest Law,
forestry requirements while using forest concession in volumes
stipulated by the effective legislation of the Russian Federation,
legal acts of the territorial and area administrations adopted within
the limits of their competence.
7.2. In case the payments for forest resources and financing of forestry
operations are transferred untimely, the party at fault pays a penalty
in amount of 0,07 percent of these amounts for every day of delay in
payment.
7.3. The mutual claims of the parties in case of violation of conditions of
the agreement are solved in court or arbitration.
8. General Issues
8.1. The parties by common consent if necessary include improvements and
amendments into this agreement.
8.2. Regarding the issues which are not stipulated by this agreement the
parties follow the effective legislation.
8.3. The conditions of the agreement are subject to the revision in case
the Forest Law undergoes amendments.
8.4. The parties annually discuss observance of performance of this
agreement.
8.5. The agreement enters into force from the date of registration in the
local administration.
8.6. The Lessor is liable within two months from the date of the agreement's
entry into force to provide the lessee the forest concession and the
required technical documents.
8.7. This agreement is signed in three copies, one copy is given to the
lessee, the second copy is sent to the area administration and the
third copy is left at the leskhoz.
9. Juridical requisites of the parties:
9.1. The Lessor: Kerbinskiy leskhoz
Mail Address: 682380 Khabarovsk Territory, Xxxxxx Xxxxxxxx village,
Payment requisites: account: 40503810270152000015 in Sberbank #4167,
X. Xxxxxxxx
9.2. The Lessee: JSC "Forest-Starma"
Mail Address: Komsomolsk-on-Amur, Alleya Truda, 1
Payment requisites: account: 40702810608030000405 FAKB Regiobank
Signature:
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General Director /s/ X.X. Xxxxxxx
JSC "Forest-Starma" --------------------
X.X. Xxxxxxx
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First Deputy General Director /s/ V.A. Limarenko
JSC "Forest-Starma" --------------------
V.A. Limarenko
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Director /s/ N.M. Xxxxxxxxx
Xxxxxxxxxx leskhoz --------------------
N.M. Limarenko
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