THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
EXHIBIT 10.13
AGREEMENT
THIS AGREEMENT entered into this 30th day of July 1997, by and between
AQUAPENN Spring Water Company, hereinafter referred to as "AQUAPENN", and Seven
Springs Water Company, hereinafter referred to as "Seven Springs",
WITNESSETH:
WHEREAS, Seven Springs is the owner and holder of a Suwannee River
Water Management District Water Use Permit No. 0-00-00000 (and any subsequent
modifications and renewals of the above referenced "Permit"); and
WHEREAS, AQUAPENN and Seven Springs are desirous of entering into this
Agreement whereby Seven Springs agrees to deliver and sell spring water under
the above referenced Permit to AQUAPENN.
NOW, THEREFORE, in consideration of the foregoing premises, the mutual
covenants contained herein, the sum of Ten Dollars, each to the other paid, and
other good and valuable considerations, the parties agree as follows:
1. TERM: The term of this Agreement shall be Ninety-Nine (99) years
from the effective date.
2. NATURE AND SCOPE OF REAL ESTATE SALE: Seven Springs shall sell to
AQUAPENN the front 40 acres which are presently zoned and permitted for a spring
water bottling plant, said property depicted in Exhibit "A", attached hereto and
made a part hereof by reference. The standards, terms and conditions shall be in
accordance with the Florida Bar-Florida Board of Realtors contract, where
applicable. The sales price shall be $7,500 per acre for a total purchase price
of $300,000.00 and shall be paid in cash, adjusted by prorations. The Seller, in
addition, grants to AQUAPENN, its successors or assigns, such ingress, egress
and public utility and such other easements as are necessary to carry out the
terms and conditions of this Agreement.
3. OPTION TO PURCHASE ADDITIONAL REAL ESTATE: Seven Springs shall
deliver to AQUAPENN in recordable form an option to purchase the adjacent
Northerly 40 acres for $7,500 per acre, said purchase price to be paid in cash,
adjusted by prorations. Said option to be delivered simultaneously with the
closing of the initial forty acres and shall run for a period of ten years. This
option shall be
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
assignable but shall be required to be for a use of the land which is a part of
or associated with the spring water operation contained in the initial 40 acres.
4. AGREEMENT FOR CONSTRUCTION OF SPRING WATER BOTTLING PLANT: Within
sixty (60) days of the closing of the purchase of the front 40 acres described
in paragraph 2 AQUAPENN will begin construction of a spring water bottling plant
having a construction cost of plant, improvements and equipment of not less than
$5,000,000 and an operational capacity of bottling no less than 150,000 gallons
a day. Said construction will be completed and the plant operational within
twelve (12) months of the date of closing. In the event AQUAPENN does not begin
such construction within sixty (60) days from the date of closing or fails to
pursue said construction with reasonable diligence once begun, Seven Springs
will have the option to repurchase said 40 acre site for $150,000 and all
liability and obligations by and between the parties will terminate. In addition
to the spring water bottling facility, AQUAPENN will, at its sole cost and
expense, provide all pumps, pipes, valves, meters, etc. necessary for the spring
water extraction and for any other monitoring required by Suwannee River Water
Management or other agency and all operational and maintenance costs associated
with said equipment.
5. MINIMUM GUARANTEE PAYMENTS: AQUAPENN agrees to purchase from Seven
Springs at a cost of [_____________] per gallon, payable on a monthly basis in
arrears, all water pumped, extracted, processed or sold by AQUAPENN. Said water
shall be extracted from the spring sources currently covered by the Suwannee
River Water Management water use permit more specifically described in paragraph
7 and be subject to the minimum and maximum amounts set forth below. In the
second year AQUAPENN shall pay a minimum annual payment of [______], in the
third year and all subsequent years a minimum annual payment of [______]. There
will be no minimum payment in the first year. For this purpose the first year
shall begin 12 months from the date of closing or when the plant first becomes
operational, whichever first occurs. Beginning the fifth year and continuing
each subsequent year, should any monthly payment by AQUAPENN be less than
[_____] [______________________] Seven Springs Water Company will have the right
to sell spring water to others on a nonexclusive basis for the ensuing sixty
(60) day period and in addition will have the right to the use of and access to
AQUAPENN's bulk spring water loading facilities on a 24-hour basis. AQUAPENN
will construct and maintain its bulk water loading facility in such a manner
that personnel from AQUAPENN or Seven Springs will not be required and the bulk
spring water customer's driver can reasonably operate the facility by himself.
So long as AQUAPENN's bulk loading facility functions in such a manner AQUAPENN
will have no staffing responsibilities for users of the bulk loading facility.
In no event shall Seven Springs sell
2
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
water in quantities which would prohibit AQUAPENN from meeting its monthly
minimum. In exchange for said use, AQUAPENN will be paid the sum of
[__________________________] per gallon for spring water not consumed by
AQUAPENN and sold to others by Seven Springs. AQUAPENN will not be responsible
for the [_____________] fee for spring water acquired by users of the bulk
facility for which AQUAPENN receives the [___________________] fee.
The parties acknowledge that AQUAPENN will have a domestic water well
for purposes of rinsing bottles or other containers, cleaning floors, sprinkler
systems and any other domestic use associated with the operation of the
facility. AQUAPENN will be under no obligation to pay a fee to Seven Springs for
this usage but AQUAPENN specifically agrees that only water purchased from Seven
Springs will be used for bottling, distribution or sale.
6. PRICE PER GALLON ADJUSTMENT: The per gallon price will be adjusted
by [_________________] of the change in the Consumer Price Index (CPI) or the
equivalent every [______] years. The parties acknowledge that in the opinion of
some the CPI as it is currently constituted overstates the true overall rate of
inflation and it has been proposed that either the current method of calculating
the CPI be changed or it be discontinued and replaced with a new index. Should
either occur, the adjustments referred to will be made so as to conform as
nearly as possible to [_________________] of the change in the CPI as currently
constituted. An identical CPI increase shall be applicable to the
[___________________] provided in Paragraphs 5 and 11.
7. REPRESENTATION AND WARRANTIES: Seven Springs hereby represents that
it is the owner and holder of an unencumbered Suwannee River Water Management
District Water Use Permit No. 0-00-00000, which permit allows extraction of
1,152,000.00 gallons per day annual average subject to a maximum daily amount of
1,728,000.00 gallons. Seven Springs shall make all necessary applications for
renewals of the permit and shall diligently pursue said renewal applications.
Seven Springs shall not jeopardize any existing or renewed permit. One of the
measures used in determining the amount of gallons available under a water use
permit is the number of acres covered by the application. To this end AQUAPENN
agrees that any acreage it owns or controls in the area may be included in any
application for a water use permit should the applicable regulations allow it
and be subject to the minimum/maximum amount set forth below.
8. RIGHT OF FIRST REFUSAL: AQUAPENN will be granted a reasonable right
of first refusal in the event Seven Springs elects to sell its rights under this
Agreement, or the spring water rights or spring water permits.
3
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
9. COVENANT NOT TO ADVERSELY AFFECT SPRING WATER QUALITY: Seven Springs
shall obtain a written agreement from Xxxxxxx Xxxx Xxxxx that any future
development of her lands shall not adversely affect the quality of spring water
to be purchased by AQUAPENN to the extent that it does not meet the quality
guidelines established by the EPA or Food and Drug Administration or the
International Bottled Water Association. This covenant shall not be interpreted
to prohibit the construction of commercial or residential facilities provided
same does not impact the spring water quality to the extent that it does not
meet the before mentioned quality guidelines.
10. QUALITY OF SPRING WATER SUPPLY: All obligations of AQUAPENN shall
be suspended during any period or periods that the spring water quality at the
source does not meet guidelines for drinking spring water established by the EPA
or Food and Drug Administration or International Bottled Water Association.
AQUAPENN will have the right but not the obligation to attempt to cure quality
defects and Seven Springs agrees to assist AQUAPENN in its efforts to cure such
defects. In the event said period of non-compliance exceeds 15 successive days
or 60 cumulative days in a given calendar year then AQUAPENN may elect to bring
or acquire bulk spring water off-site to supply the plant so long as such
condition exists and for 30 days thereafter or terminate this Agreement and have
no further liability hereunder.
11. GOVERNMENTAL IMPOSITIONS: AQUAPENN will pay to the proper
governmental authority all taxes, if any, due and owing upon any sums payable to
Seven Springs, except income, estate or gift taxes. AQUAPENN will pay to or on
behalf of Seven Springs to the proper governmental authority all taxes, if any,
imposed upon water extracted and delivered to AQUAPENN or processed by AQUAPENN,
such as a severance or consumptive use tax. In the event said taxes exceed the
sum of [___________________] per gallon, then and in that event AQUAPENN may
terminate this Agreement and shall have no further liability hereunder.
12. CONTINGENCIES: AQUAPENN will have six months from the date of this
agreement to obtain approval of the Board of Directors of AQUAPENN for this
transaction; to complete all testing and analysis to determine the necessary
quality of the spring water; the suitability of the plant site; and to obtain
all necessary permits for the construction of the spring water bottling plant
and related approvals for removal of the spring water. On or before the
six-month period, AQUAPENN shall satisfy or notify Seven Springs in writing that
it has waived all contingencies, at which time the closing referenced in
Paragraph 2 above shall occur.
13. DESTRUCTION OF SPRING WATER BOTTLING PLANT: In the event the
bottling plant is destroyed in whole or in part by a casualty
4
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
to the extent that operation of the bottling plant must be suspended, then, and
in that event, AQUAPENN may elect to terminate this Agreement or to repair or
restore the plant and shall notify Seven Springs of its election within 30 days
of the casualty. In the event AQUAPENN elects to rebuild the plant, the minimum
payments will be suspended during the reconstruction period. If AQUAPENN elects
to rebuild, it shall begin the rebuilding within 30 days of notifying Seven
Springs of its election to do so and diligently pursue said construction. In the
event AQUAPENN elects not to rebuild, it will grant a right of first refusal to
Seven Springs and will agree not to build another bottling facility nor purchase
water from any source within 100 miles of Xxxxxx Springs within the next seven
(7) years.
14. ELECTION TO TERMINATE: Notwithstanding anything contained herein to
the contrary, AQUAPENN may elect to terminate this Agreement at any time, for
any reason, and shall be liable to Seven Springs for payment of a sum equal to 6
months minimum guarantee from the date of termination.
15. RIGHT OF ENTRY: Seven Springs hereby grants to AQUAPENN and its
authorized agents the right to freely enter upon the lands herein described for
the purpose of inspection and testing the lands and the spring water.
16. OTHER AGREEMENTS: This Agreement constitutes the entire agreement
between the parties, and any changes, amendments or modifications hereof shall
be null and void unless same are reduced to writing and signed by the parties
hereto.
17. PERSONS BOUND: The covenants herein contained shall bind, and the
benefits and advantages shall inure to, the respective heirs, executors,
administrators, successors and assigns of the parties hereto. Whenever used, the
singular number shall include the plural, the singular, and the use of any
gender shall include all genders. Other party may assign their rights in the
Agreement.
18. ATTORNEYS' FEES, COSTS: In the event of any litigation arising out
of this Agreement, the prevailing party shall be entitled to recover from the
non-prevailing party all expenses incurred by the prevailing party in connection
with said litigation including a reasonable attorney's fee.
19. SURVIVAL OF COVENANTS: Any of the representations, warranties,
covenants, and agreements of the parties, as well as any rights and benefits of
the parties pertaining to a period of time following the closing of the
transactions contemplated hereby, shall survive the closing and shall not be
merged therein.
5
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
20. NOTICES: Any notice required or permitted to be delivered hereunder
shall be deemed received when sent by United States mail, postage prepaid,
certified mail, return receipt requested, or by express courier, addressed to
Seller or Buyer, as the case may be, at the address set forth below:
Seven Springs Water Company
c/o Xxxxxx Springs, Inc. with copy to W. Xxxxxxxx Xxxxxxx, Attorney at Law
0000 X.X. Xxxxxx Xxxxxxx Xxxx 000 00xx Xxxxxx X.,
Xxxx Xxxxxxx, XX 00000 Xx. Xxxxxxxxxx, XX 00000
AQUAPENN Spring Water Company
Xxx XxxxXxxx Xxxxx
X.X. Xxx 000
Xxxxxxxxx, XX 00000
With copy to:
McQuaide, Blasko, Xxxxxxxx
000 Xxxxxxxxxx Xxxxx
Xxxxx Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxxx, Esquire
Xxxxxx X. Xxxxxx, Esquire
(000) 000-0000
21. DESCRIPTIVE HEADINGS: The descriptive headings used herein are for
convenience only and are not intended to necessarily refer to the matter in
sections which precede or follow them, and have no effect whatsoever in
determining the rights or obligations of the parties.
22. STOCK OPTION: Simultaneously with the closing AQUAPENN shall grant
to Seven Springs Water Company the option during a ten-year period commencing
with the date of closing to purchase 75,000 shares of AQUAPENN's common stock as
it currently exists at Five Dollars ($5.00) per share.
23. COVENANTS RUNNING WITH THE LAND: The deed to the property described
in paragraphs 2 and 3 shall contain covenants running with the land as set forth
in the attached Exhibit B.
24. RIGHT OF FIRST REFUSAL: Anything to the contrary in this agreement
notwithstanding, should AQUAPENN terminate this agreement for any reason, Seven
Springs will have the right of first refusal to purchase any real estate
described in paragraphs 2 and 3 which was purchased by AQUAPENN together with
the improvements and fixtures and easements attached to or used in relation to
the transporting, processing or bottling of water. The terms of such right of
first refusal are set forth in attached Exhibit "C". This right of first refusal
will not apply unless and until this agreement is terminated and will expire
five (5) years after the date of termination.
6
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
25. SURVIVAL OF OBLIGATIONS: Anything to the contrary in this agreement
notwithstanding, should AQUAPENN terminate this agreement for any reason, all
obligations incurred by AQUAPENN prior to such termination, including but not
limited to water charges (including minimums), and governmental impositions
shall survive such termination.
26. ALL WATER MUST BE PURCHASED FROM SEVEN SPRINGS: Anything to the
contrary in this agreement notwithstanding, AQUAPENN agrees that any and all
water purchased, processed or sold at its water bottling plant to be constructed
pursuant to paragraph 4 or anywhere within 100 miles of the site of said water
bottling plant shall be purchased from Seven Springs subject only to the
exception set forth in paragraph 10 pertaining to acquisition of bulk spring
water offsite to supply the plant so long as conditions exist as outlined
therein. This provision shall survive the termination of this agreement.
27. INSPECTION MEASUREMENT AND CONFIRMATION: AQUAPENN will provide
copies of its records certified as correct by a company officer covering all
water sales and shipments no less than twice monthly, allow Seven Springs full
access to its pumping facilities and the right to install measurement devices so
that Seven Springs can independently measure the volume of water extracted.
Seven Springs will also have reasonable access to AQUAPENN's water distribution
facilities for the purpose of independently measuring the volume of water sold
or distributed.
28. ADJUSTMENTS TO DESCRIPTIONS AND PURCHASE PRICE OF PROPERTIES
COVERED IN PARAGRAPHS 2 AND 3: The conveyances covered by paragraphs 2 and 3
will exclude the east sixty (60) feet of the described property and should such
exclusion cause the total area of either parcel conveyed to be less than forty
(40) acres, AQUAPENN will receive a credit at closing equal to $7500 times the
number of acres conveyed which is less than forty (40). For example, should the
total area of one parcel conveyed equal 39-1/2 acres, the credit will equal
$3750.
Seven Springs Water Company AQUAPENN Spring Water Company
By: /s/ Xxxxxxx Xxxx Xxxxx By: /s/ Xxxxxx X. Xxxxx, III
------------------------- ------------------------------
As President As President
Attest: /s/ Xxxx X. Xxxx Attest: /s/ Xxxxxx X. Xxxxxxxxxx
--------------------- --------------------------
As Secretary As Secretary
7
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
EXHIBIT "A"
THIS QUIT-CLAIM DEED, executed this 31st day of March, 1995, by
XXXX X. XXXX, XXXXXX XXXX XXXXXXX, and XXXX XXXX XXXXXXX c/o 000 X.X.
Xxxxxx Xxxxxxx Xxxx., Xxxx Xxxxxxx, XX 00000 First Party, to
SEVEN SPRINGS WATER COMPANY
whose address is 000 00xx Xxxxxx, Xxxxx, Xx. Xxxxxxxxxx, XX 00000 and whose Tax
I.D. Number is 00-0000000
(Wherever used herein the terms "First Party" and "Second Party" shall
include singular and plural, heirs, legal representatives, and assigns
of individuals, and the successors and assigns of corporations,
wherever the context so admits or requires.)
WITNESSETH, That the said First Party, for and in consideration of the
sum of Ten and No/100 Dollars ($10.00), in hand paid by the said Second Party,
the receipt (illegible text) hereby acknowledged, does hereby remise, release
and quit claim to the said Second Party forever, all the right, title,
interest, claim and demand which the said first party has in and to the
following described lot, piece or parcel of land, situate, lying and being in
the County of Xxxxxxxxx, State of Florida, to wit:
Commence at the SW corner of the NW 1/4 of SW 1/4 of Section 2, TBE,
R16E for a point of reference. Thence run along the South line of said
NW 1/4 of SW 1/4, M88^43'51"E, 18.00 feet to the point of beginning.
Thence run 801^06'24"E, 158.86 feet to the North R/W line of County
Road No. C-340, said point being on a curve; thence run along said R/W
line on curve being concave Northerly (having a central angle of
11^09'22" and a radius of 5679.58 feet) Northeasterly an arc distance
of 1105.88 feet to point of tangency; thence continue along said R/W
line N71^22'11"E, 239.93 feet to the East line of said NW 1/4 of SW
1/4; thence run along said East line, N01^00'16"W, 1155.86 feet; thence
run SSE^43'54"W, 1310.47 feet; thence run 801^06'24"E, 1296.17 feet to
the point of beginning, all lying and being in Xxxxxxxxx County,
Florida.
THIS IS NOT HOMESTEAD PROPERTY
Tax Parcel # 02-08-16-0000-0003-0010
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
TO HAVE AND TO HOLD the same together with all and singular the
appurtenances thereunto belonging or in anywise appertaining, and all the
estate, right, title, interest, lien, equity and claim whatsoever of the said
First Party, either in law or equity and claim whatsoever of the said First
Party, either in law or equity, to the only proper use, benefit and behalf of
the said Second Party forever.
IN WITNESS WHEREOF, the said First Party has signed and sealed these
presents the day and year first above written.
Signed, sealed and delivered in our presence as witnesses:
/s/ Xxxx X. Xxxxxxxxx /s/ Xxxx X. Xxxx L.S.
----------------------------- ---------------------
Xxxx X. Xxxxxxxxx XXXX X. XXXX
/s/ Xxxxxxx X. Xxxxxxxxxxx /s/ Xxxxxx X. Xxxxxxx L.S.
----------------------------- ---------------------
Xxxxxxx X. Xxxxxxxxxxx XXXXXX XXXX XXXXXXX
/s/ Xxxx Xxxx Xxxxxxx X.X.
---------------------
XXXX XXXX KLEMANS
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
EXHIBIT "B"
COVENANT RUNNING WITH THE LAND: Grantee agrees and covenants that the land and
any improvements to it shall be used solely for the bottling, processing and
distribution of potable water and incidental uses associated with same.
THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
EXHIBIT "C"
RIGHT OF FIRST REFUSAL: Before AQUAPENN may sell or transfer the property
described in either paragraphs 2 or 3 of this agreement or the improvements on
it, it must first offer it to Seven Springs by giving Seven Springs written
notice of the price, terms and conditions upon which AQUAPENN proposes to sell
or transfer the property. Seven Springs will have 30 days from receipt of such
written notice within in which to notify AQUAPENN that Seven Springs agrees to
purchase the property on the same terms and conditions stated in the notice and
if it does the sale shall be closed 30 days after of such notification. If Seven
Springs does not accept the offer in writing within 30 days after receipt of it
AQUAPENN may sell the property to any other purchaser at and only at the same
price, terms and conditions stated in the notice to Seven Springs provided that
such sale shall be closed within 160 days after the date of the first notice to
Seven Springs. If AQUAPENN has not completed the sale or transfer within said
160-day period, the right of AQUAPENN to sell or transfer the property free from
the right of first refusal held by Seven Springs will terminate and the
provisions of this agreement will apply to any subsequent proposed sale or
transfer of the property by AQUAPENN. The term "transfer" includes but is not
limited to a lease agreement.
