Exhibit 10(i).13
OPTION TO LEASE REAL ESTATE AGREEMENT
THIS OPTION TO LEASE REAL ESTATE
AGREEMENT
(this
"Agreement") is entered
into as of this 15th day of January,
2007 by and between Dennis Grain,
Inc., a
Nebraska
corporation
(hereinafter
referred to as "Owner") and NEDAK
Ethanol,
LLC,
a
Nebraska
limited
liability
company
(hereinafter
referred
to
as
"Prospective Tenant").
RECITALS
A.
Owner is the owner of certain
real estate
located
generally
at the
intersection of Sale Barn Road and 10th Street in O'Neil, Holt
County,
Nebraska,
more
accurately
identified on the map attached
hereto as
Exhibit "A" and the legal description
attached hereto as Exhibit "B".
Such real estate is hereinafter referred to as the "Option
Property".
B.
The
parties
desire
to
execute
this
Agreement,
thereby
granting
Prospective
Tenant the sole and exclusive
option to lease the Option
Property, pursuant to the terms set forth below.
NOW,
THEREFORE,
for
just
and
proper
consideration,
the
receipt
and
sufficiency of which are hereby acknowledged, the parties do hereby
agree to the
following:
1.
Owner hereby grants to Prospective Tenant sole and exclusive option
to
lease the Option Property. The option to lease the Option Property
may
hereinafter be referred to as the "Option".
2.
Prospective
Tenant
may
exercise
the
Option
to lease
the
Option
Property
at any time
during the Term of this
Agreement
(as defined
below). Within fifteen (15) days upon Prospective Tenant's exercise
of
the Option, given via written notice from Prospective Tenant to
Owner,
the parties shall execute the ground lease attached
hereto as Exhibit
"C" (the "Ground Lease").
3.
In
consideration of this Agreement,
Prospective
Tenant shall pay to
Owner the sum of Two
Hundred
Dollars and No Cents
($200.00)
within
five (5) days following the date hereof.
Such funds shall hereinafter
be
referred to as the
"Deposit."
Upon the
execution
of the Ground
Lease,
the parties shall apply the Deposit to any
consideration
due
thereunder.
4.
Prospective
Tenant may exercise the Option at any time within one (1)
year
following the
execution of this
Agreement
(the
"Term").
The
Option shall be
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deemed void
should
Prospective
Tenant
fail to exercise
the Option
within such time.
5.
During the term of this
Agreement,
Owner shall (i) not
encumber the
Option
Property
or any part
thereof,
(ii)
not
sell or
otherwise
transfer title to the Option Property or any part thereof to any
third
party, or (iii) reject any prospective purchase agreements or
purchase
offers for the Option
Property or any part
thereof
presented by any
third party.
6.
Prospective
Tenant shall have the right to enter the Option
Property
during
the
Term of this
Agreement
upon
reasonable
notice
and at
reasonable times to conduct
geotechnical surveys and/or environmental
tests,
including,
but not limited to,
so-called "Phase I" or "Phase
II" environmental
analyses, and tests to determine whether the Option
Property will be suitable for Prospective
Tenant's potential business
purposes set forth in the Ground Lease.
Prospective
Tenant agrees to
indemnify and hold harmless Owner against any and all claims,
actions,
damages,
liability
and
expense
in
connection
with
loss of life,
personal injury and/or damage to property arising from such surveys
or
tests; provided,
however, that Owner shall not be indemnified for the
negligence or willful
misconduct of Owner, or its employees,
agents,
contractors or invitees.
7.
Whenever in this
Agreement
it shall be required
or
permitted
that
notice be given by either party hereto to the other, such notice
shall
be forwarded by hand, certified mail, or overnight delivery,
addressed
as follows:
If to Owner:
Dennis Grain, Inc.
406 S. 10th St.
O'Neill, Nebraska 68763
Attn: Steve Dennis
If to Prospective Tenant:
NEDAK Ethanol, LLC
PO Box 391
Atkinson, Nebraska 68713
Attn: Jerome Fagerland
Such notices shall be deemed
received when such
certified
letter is
deposited
in
the
mail
or
notice
is
transferred
to a
reputable
overnight delivery service.
8.
Prospective
Tenant shall not assign any or all of its rights
arising
from this Agreement
without the prior written approval of Owner, such
approval not to be unreasonably
withheld or delayed.
Notwithstanding
the foregoing,
an assignment to any affiliate of Prospective
Tenant,
to any
entity
with
which
or
into
which
Prospective
Tenant
may
consolidate or merge or to any entity to which
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Prospective
Tenant
may sell all or
substantially
all of its assets
shall not constitute an assignment requiring Owner's consent.
9.
No waiver of any
condition
or legal right or remedy shall be implied
by the
failure of either
party to declare a
forfeiture,
or for any
other
reason,
and no waiver of any
condition
or covenant
shall be
valid
unless
it be in
writing
signed
by
the
party
granting
or
consenting to such waiver.
10.
This
Agreement
and the
exhibits
attached
hereto set forth all the
covenants, promises, agreements, conditions and understandings
between
the parties concerning the Option Property and there are no
covenants,
promises,
agreements,
conditions or
understandings,
either oral or
written,
between
them other
than are
herein
set forth.
Except as
herein otherwise provided, no subsequent alteration, amendment,
change
or addition to this Agreement shall be binding upon the parties
unless
reduced to writing and signed by them.
11.
In the event
that any
provision
or
section
of this
Agreement
is
rendered
invalid by the decision of any court or by the
enactment of
any law,
ordinance or regulation,
such provision
shall be deemed to
have never been
included
therein and the balance
shall
continue in
effect in accordance with its terms.
12.
This Agreement and the rights and
obligations of the parties
arising
hereunder
shall be construed in accordance with the laws of the state
in which the Option Property is located.
13.
Prospective
Tenant
shall
lease
the
Option
Property
in
"as
is"
condition,
with
no
representations
or
warranties
by
Owner,
and
Prospective
Tenant
hereby
relies on its personal
inspection of the
Option Property.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
-3-
IN WITNESS HEREOF,
Owner and Prospective Tenant have executed this Agreement as
of the date first written above.
OWNER:
/s/ Steve Dennis
------------------------------------
Dennis Grain, Inc.
PROSPECTIVE TENANT
NEDAK Ethanol, LLC
By:
/s/ Jerome Fagerland
-------------------------------
Name:
Jerome Fagerland
-------------------------------
Its:
President and General Manager
-------------------------------
STATE OF ________________
)
) ss.
COUNTY OF _______________
)
The
foregoing
instrument
was
acknowledged
before
me
on
____________________,
2006, by
_____________________,
the
__________________
(type of officer) of Dennis Grain, Inc.
________________________________________
Notary Public
My Commission expires:_____________________
STATE OF ________________
)
) ss.
COUNTY OF _______________
)
The
foregoing
instrument
was
acknowledged
before
me
on
____________________, 2006, by ______________________,
the ____________________
(type of officer) of NEDAK Ethanol, LLC.
________________________________________
Notary Public
My Commission expires:_____________________
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EXHIBIT "A"
Option Property Map
-5-
EXHIBIT "B"
Option Property Legal Description
-6-
EXHIBIT "C"
Form of Ground Lease
-7-
GROUND LEASE
THIS GROUND LEASE (this "Lease"), dated as of _____________,
200__ between
DENNIS GRAIN, INC., a Nebraska corporation
("Landlord") and NEDAK Ethanol, LLC,
a Nebraska limited liability company ("Tenant").
Preliminary Statements
Landlord is the owner in fee simple of certain land located in Holt
County,
Nebraska,
legally
described on Exhibit A, attached hereto and
incorporated by
reference herein (the "Premises").
Landlord
desires to lease the
Premises to Tenant,
and Tenant
desires to
lease
the
Premises
from
Landlord,
subject
to and in
accordance
with
the
provisions
of this Lease.
A map
illustrating
the location of the Premises is
attached hereto as Exhibit B.
Agreement
NOW,
THEREFORE,
for and in
consideration
of the
mutual
covenants
and
agreements
herein set forth,
and other good and
valuable
consideration,
the
receipt and
sufficiency of which are hereby
acknowledged by each party hereto,
Landlord and Tenant hereby agree as follows:
1.
Lease of Premises
.
Landlord hereby leases the Premises to Tenant upon
the terms and conditions contained herein.
2.
Term
. The term of this Lease (the "Term") shall be as follows:
(a)
Commencement
Date
.
The
commencement
of this Lease for
purposes of
commencement of the parties' rights and obligations hereunder shall
be
_______________, 200__ (the "Commencement Date").
(b)
Term
.
The Term of this
Lease
shall be twenty
(20)
years
from the
Commencement Date. This lease shall automatically renew for
additional
five (5) year periods
unless
Tenant gives notice of
non-renewal
to
Landlord at least three (3) months prior to expiration.
3.
Rent
.
Tenant shall pay Landlord,
at the address set forth in Section
18 below,
as annual
rental for the Premises
during the term of this Lease the
sum of
$3,000.00
(the
"Rent")
without
prior
notice or demand
therefor and
without
offset or
counterclaim.
Such sum shall be payable
within thirty (30)
days following the
Commencement
Date, and shall thereafter be payable annually
within thirty (30) days following each anniversary of the
Commencement Date.
4.
General
Intent
of
Ground
Lease
.
During
the
term of this
Lease,
Landlord shall have no responsibility
with respect to the Premises,
including,
but not limited to, the payment of any costs or expenses for the
use,
operation
or maintenance of the Premises or any
improvements
thereon.
Real estate taxes
shall paid by the Landlord.
-8-
5.
Use
of
Premises
.
Tenant
may
only
use
the
Premises
for
the
construction,
operation and
maintenance of an ethanol
trans-loading
facility
(the "Trans-Loading Facility").
Tenant shall not use the Premises for any other
purpose without first obtaining the written approval of Landlord,
which may not
be unreasonably withheld.
Landlord shall not be obligated to provide for or pay
for any improvement work or services related to the improvement of
the Premises.
Prior to construction of the
Trans-Loading
Facility,
Tenant shall submit
plans
and/or
specifications
for the same to
Landlord
for
Landlord's
prior
written
approval,
which may not be
unreasonably
withheld.
Tenant
shall not
commence construction of the Trans-loading Facility without
obtaining such prior
written approval. Tenant shall construct such Trans-loading
Facility and perform
any repairs thereto in conformance with any and all applicable
federal,
state,
county or municipal laws,
rules and
regulations.
All work with respect to the
Trans-loading
Facility
must be
done
in a good
and
workmanlike
manner
and
diligently prosecuted to completion.
Tenant's taking
possession of the Premises or any portion thereof shall be
conclusive
evidence
against Tenant that the Premises was then in
satisfactory
condition.
No
promises
of the
Landlord to build,
alter,
remodel,
improve,
repair,
or clean
the
Premises
or any part
thereof
have been
made,
and no
representation
respecting the condition of the Premises has been made to Tenant
by or on behalf of Landlord.
7.
Access to the Premises
.
Tenant shall have access to the Premises on a
twenty-four (24) hours per day, seven (7) days per week basis.
8.
Utilities
.
Tenant
shall
pay
for
all
utilities
provided
to
the
Premises.
Tenant
agrees
that
Landlord
shall not be liable for
damages,
by
abatement of Rent or otherwise,
for failure,
delay, diminution or interruption
of
any
utilities
or
services
for
any
reason,
except
when
such
delays,
diminutions or interruptions are caused by the negligence or
willful
misconduct
of Landlord.
9.
Compliance with Law
.
During the term of this Lease,
Tenant shall, at
Tenant's sole cost and expense,
comply
promptly with all applicable
statutes,
laws,
ordinances,
regulations,
and
requirements in effect during the term of
this Lease
applicable to the Premises and Tenant's
activities
and
operations
thereon.
Tenant shall not use or allow
another
person or entity to use any part of
the Premises for the storage,
use, treatment,
manufacture or sale of Hazardous
Materials,
as that term is defined below. Landlord acknowledges,
however, that
Tenant
may
maintain
products
at the
Premises
which
may be
incidental
or
necessary
to the
operation
and
maintenance
of the Premises and which may be
categorized
as
Hazardous
Materials.
Landlord
agrees
that
the
use of such
products in the
Premises in
compliance
with all laws and in the manner
which
such products are designed to be used shall not be a violation by
Tenant of this
Section.
As used
herein,
Hazardous
Materials
mean
any
hazardous
or toxic
substances,
materials or waste, pollutants or contaminants,
as defined, listed
or
regulated
by any
federal,
state or local law,
regulation
or order or by
common
law
decision.
Tenant
shall
cause
any
and all
Hazardous
Materials
discharged
or
located
on the
Premises
during
the term of this
Lease to be
removed
and
transported
solely
by duly
licensed
haulers
to duly
licensed
facilities for final disposal of such materials and wastes.
Tenant shall in all
respects handle, treat, deal with and manage any and all Hazardous
Materials in,
on,
-9-
under
or
about
the
Premises
in
total
conformity
with
all
applicable
environmental
laws and prudent industry practice
regarding
management of such
Hazardous Materials.
Upon expiration or earlier termination of the term of this
Lease, Tenant shall cause all Hazardous Materials brought to the
Premises during
the term of this Lease by anyone
other than
Landlord or
Landlord's
officers,
directors,
employees or agents,
to be transported for use, storage or disposal
in accordance with the compliance with all applicable
Hazardous Materials laws.
Tenant's obligations under this Section 9 shall include, without
limitation, all
costs
and work or
obligations
of any
governmentally
required
or
necessary
environmental
investigation and cleanup of the Premises related to Tenant's use
or operation of the Premises.
Landlord hereby
represents and warrants that the
Premises
comply
with all laws,
regulations
and
ordinances,
both
state and
federal,
concerning
Hazardous
Materials
as of
the
Commencement
Date.
The
provisions of this Section 9 shall survive the expiration or
earlier termination
of the term of this Lease.
10.
Maintenance
and
Repairs
.
Landlord
shall
have
no
obligation
or
authority
whatsoever
to
maintain or repair the
Premises or any
improvements
thereon.
Tenant shall, at its own expense,
perform all maintenance and repairs
on the Premises, including ordinary repairs and maintenance. Tenant
shall at all
time keep the
Premises
free of trash,
debris,
junk,
derelict
vehicles
and
derelict equipment, and shall keep all improvements hereafter
constructed on the
Premises
in good
and safe
condition
and
repair.
Tenant
shall
not use the
Premises or permit the Premises to be used in any way that may
create waste or a
nuisance, or in any way that may damage the Premises.
11.
Insurance & Indemnity
.
11.1
Insurance
Requirements
.
Tenant
agrees
during
the term
hereof
to
maintain
public
liability
and
other
insurance
with
reputable
insurance
companies,
and shall
furnish
Landlord
within one (1) week
after
Landlord's
request
therefor
certificates
of
insurance
properly
executed
by
Tenant's
insurance
companies
evidencing
such
fact.
The
insurance
coverage
to
be
maintained
by Tenant
shall name
Landlord as an
additional
insured and shall
include
commercial
general
liability
insurance,
with
blanket
contractual
liability
endorsement,
against
claims for bodily
injury,
death and property
damage
occurring
on or about the
Premises,
affording
minimum
single
limit
protection of $2,000,000
with respect to personal
injury or death and property
damage occurring or resulting from one occurrence.
Tenant
shall
also
maintain
worker's
compensation
insurance
in
compliance with all applicable laws.
All such insurance required to be maintained under the first
paragraph
of this Section 11.1 by Tenant shall
provide that such
insurance
shall not be
cancelled or coverage changed unless the insurance
company endeavo
