Filed by Bowne Pure Compliance





Exhibit 10.1


FARM LEASE


By this agreement
made effective April 16, 2008, between MinnErgy, LLC, a Minnesota limited
liability company with an address of 8 North Front Street NW, Eyota, MN 55934,
referred to herein as “Lessor”, and Hadar Farms Partnership, a
Minnesota partnership with an address of 49890 Highway 57 Blvd, Zumbrota, MN 55909 referred to
herein as “Lessee,” Lessor rents to Lessee, and Lessee hires from Lessor
the following described premises, herein referred to as “leased
premises”:


Approximately 153
tillable acres of that real property legally described on Exhibit A
attached hereto on the following terms and conditions:


1. RENT: Lessee agrees to pay to Lessor, in advance
upon execution of this lease, as rent for the leased premises for the term
hereof the sum of Forty-six Thousand Six Hundred Sixty-five and no/100 Dollars
($46,665).


2. TERM: The premises are leased for a term of six
and one half months, beginning April 15, 2008 and ending on
November 1, 2008.


3. RIGHT OF
ENTRY: Lessor or Lessor’s agents shall have the right to enter the
leased premises at reasonable times and from time to time in order to inspect
the leased premises and to do all other lawful acts that are necessary to
protect Lessor’s interest in the leased premises. Lessor also shall have
the right to remove or destroy Lessee’s crop on any portion of the leased
premises and to use such portion of the leased premises in the conduct of
Lessor’s business operations. In the event Lessor exercises its right to
remove or destroy any of Lessee’s crop, Lessor shall pay to Lessee $305
per acre of crop removed or destroyed plus Lessee’s “crop input
costs” for such crops. For purposes of this agreement, the term
“crop input costs” shall mean amounts paid by Lessee for seed,
fertilizer, insecticide, and herbicide. Prior to payment, Lessee shall furnish
to Lessor documents evidencing the “crop input costs” for which
Lessee seeks payment.


4. USE OF
PREMISES: The leased premises shall be used for the purposes of farming and
agriculture, and said activities shall be conducted by the Lessee in accordance
with good husbandry practices. This leased premises shall not be used for any
other purpose without the prior written consent of the Lessor. Lessee shall
comply with all laws, ordinances, rules and orders of appropriate governmental
authorities effecting the cleanliness, occupancy, and preservation of the
leased premises during the term of this Lease.


5. REPAIRS
OF ALTERNATIONS: Lessee will not make or permit to be made any alterations,
additions, improvements, or changes to the leased premises without in each case
first obtaining the written consent of Lessor, which consent shall not
unreasonably be withheld. A consent to a particular alteration, addition,
improvement, or change shall not be deemed a consent to or a waiver of
restrictions against alterations, additions, improvements, or changes for the
future. All alterations, additions, changes and improvements built,
constructed, or placed on the leased premises and moveable personal property,
shall, unless otherwise provided by written agreement between Lessor or Lessee,
be the property of Lessor and remain on the leased premises at the expiration
or sooner termination of this lease.


  


  









 





Lessee shall keep
the leased premises free and clear from any and all liens, claims and demands
for work performed, materials furnished or operations conducted on the property
at the instance or request of the Lessee.


6. INDEMNITY: The Lessee agrees to indemnify and
hold the Lessor and the property of the Lessor free and harmless from any and
all claims, liability, loss, damage, or expense resulting from the
Lessee’s use and occupation of the leased premises, specifically
including without limitation any claim, liability, loss, or damage arising by
reason of injury to person or property.


7. ASSIGNMENT AND SUBLETTING: Lessee shall not
assign this lease, or sublet or grant any concession or license to use the
premises or any part thereof without the prior written consent of Lessor. A
consent by Lessor to one assignment, subletting, concession or license shall
not be deemed to be a consent to any subsequent assignment, subletting,
concession, or license. An assignment, subletting, concession, or license
without the prior written consent of Lessor, or an assignment of subletting by
operation of law, shall be void and shall, at Lessor’s option, terminate
this lease.


8. DEFAULT: If Lessee defaults in the payment of
rent or any part thereof at the times hereinbefore specified, or if Lessee
defaults in the performance of or compliance with any other term or condition
hereof, the lease, at the option of the Lessor, shall terminate and be
forfeited, and Lessor may re-enter the premises and retake possession and
recover damages, including costs and attorneys’ fees. Lessee shall be
given ten (10) days’ written notice of any default or breach, and
termination and forfeiture of the lease shall not result if, within ten
(10) days of receipt of such notice, Lessee has corrected the default of
breach.


If suit is brought
by Lessor for an eviction, for the recovery of any rent due under the
provisions of this agreement, or for any obligation of Lessee arising under
this agreement or by law, then Lessee hereby agrees to pay Lessor all the costs
in connection therewith, including, but not limited to, reasonable
attorneys’ fees, whether or not the action or actions proceed to judgment.


A waiver by Lessor
of a breach of any covenant or duty of Lessee under this lease is not a waiver
of a breach of any other covenant or duty of Lessee, or of any subsequent
breach of the same covenant or duty.


9. SURRENDER
OF PREMISES: At the expiration of the lease term, Lessee shall quit and
surrender the premises in as good state and condition as they were at the
commencement of this lease, reasonable use and wear thereof and damages by the
elements excepted. In the event Lessee is unable, due to adverse weather
conditions and through no fault of Lessee, to remove Lessee’s crops from
the leased premises prior to expiration of the term hereof, Lessee shall have
until November 15, 2008 to remove such crops. Any crops not removed by
such time shall be deemed abandoned and shall be the property of Lessor.


  


  









 





10. ABANDONMENT: If any time during the term of
this lease, Lessee abandons the leased premises or any part thereof, Lessor
may, at Lessor’s option, enter the leased premises by any means without
being liable for any prosecution therefore, and without becoming liable to
Lessee for damages or for any payment of any kind whatsoever, and may, at
Lessor’s discretion, as agent for Lessee, relet the leased premises, or
any part thereof, for the whole or any part of the then unexpired term, and may
receive and collect all rent payable by virtue of such reletting, and, at
Lessor’s option hold Lessee liable for any difference between the rent
that would have been payable under this lease during the balance of the
unexpired term, if this lease had continued in force, and the net rent for such
period realized by Lessor by means of such reletting. If Lessor’s right
to re-entry is exercised following abandonment of the premises by Lessee, then
Lessor may consider any personal property belonging to Lessee and left on the
premises to also have been abandoned, in which case Lessor may dispose of all
such personal property in any manner Lessor shall deem proper and is hereby
relieved of all liability for doing so.


11. WRITTEN
NOTICES: All written notices permitted or required to be given or served
under this lease shall be deemed to have been duly given or served if given or
served either by personal delivery, effective upon receipt, or by deposit in
the United States mail, postage prepaid for mailing by certified mail,
effective upon mailing. Such written notice shall be addressed to such party at
the address set forth in the first paragraph of this lease. Any party may
change such party’s address by giving written notice, stating such
party’s new address, to any party to this lease as provided in the
foregoing manner. Commencing on the tenth (10) day after the giving of
such written notice, such newly designated address shall be such party’s
address for purpose of all future written notices permitted or required to be
given or served under this lease.


12. BINDING
EFFECT: The covenants and conditions herein contained shall apply to and
bind the heirs, legal representatives, and assigns of the parties hereto, and
all covenants are to be construed as conditions of this lease.


13. TIME OF
ESSENCE: Time is of the essence with respect to all provisions of this
Lease.


14. HEADINGS: Headings in this Lease are for
convenience only and shall not be used to interpret or construe its provisions.


In witness whereof,
the parties have executed this agreement as of the date stated above.


	 	 	 
	MinnErgy, LLC, Lessor
	
 

	 	 
	
By: 

	 	/s/ Ronald Scherbring
	
 

	 	 
	
Its: 

	 	President & CEO of MinnErgy
	
 

	 	 
	
 

	 	 
	Hadar Farms Partnership, Lessee
	
 

	 	 
	
By: 

	 	/s/ David Fredrickson, Partner
	
 

	 	 
	
Its: 

	 	Hadar Farms Partnership
	
 

	 	 





  


  









 





Exhibit A


Description of Property


The Northwest Quarter of
Section 15 except that part sold to Chatfield Railroad Company, and
further expecting the following parcel:


That part of the NW1/4 of Sec. 15,
T106N, R12W, Olmsted County, Minnesota, described as follows: 

Commencing
at the SW corner of said NW1/4; thence Easterly on a Minnesota State Plane Grid
Azimuth from North of 90o00’26” along the South line of said
NW1/4 1314.59 feet to the point of beginning; thence continue Easterly
90o00’26” azimuth along said South line 270.07 feet; thence
Northerly 359o38’36” azimuth 785.85 feet; thence Easterly
86o44’39” azimuth 28.19 feet; thence Northerly
01o14’28” azimuth 113.34 feet; thence Easterly
81o58’23” azimuth 46.98 feet; thence Northerly
00o08’02” azimuth 449,92 feet; thence Westerly
269o40’29” azimuth 617.34 feet; thence Southerly
180o08’36” azimuth 753.06 feet; thence Easterly
90o16’49” azimuth 268.02 feet; thence Southerly
179o14’55” azimuth 599.37 feet to the point of beginning.


Together with a 20.00 foot wide access easement for ingress and egress
over part of the NE1/4 NW1/4 of said Sec. 15, and part of the SE1/4 SW1/4 of
Sec. 10, T106N, R12W, Olmsted County, Minnesota, which centerline is described
as follows: 

Commencing at the NW corner of the NW1/4; thence Easterly on a
Minnesota State Plane Grid Azimuth from North of 89o54’08”
along the North line of said NW1/4 1673.02 feet; thence Northerly
359o55’12” azimuth 268.88 feet to the Southerly right-of-way
line of 19th Street SE and the point of beginning; thence Southerly
179o55’12” azimuth 268.88 feet to the North line of said
NW1/4; thence Southerly 180o20’47” azimuth 1284.13 feet of the
North property line of said tract and there terminating. Sidelines of said
easement are to be lengthened or shortened to intersect with the Southerly
right-of-way line of 19th Street SE and the North property line of said tract.
(Described in Olmsted County real estate records as Parcel Number
62.15.24.073956).


And, all that part of the Southwest
Quarter, Section 10, South of the Winona and St. Peter Railroad;


All in T106N, R12W, Olmsted County,
Minnesota.


(Described in Olmsted County real
estate records as Parcel Numbers 62.15.21.073955 and 62.10.33.032684).