**Exhibit 10.2**

 

**GRANT OFEASEMENT AND RIGHT OF WAY**

 

This Agreement made this 05 day of April,2005, between the State of Kansas, by and through the Kansas Department ofWildlife and Parks, hereinafter referred to as GRANTOR, and in favor of EastKansas Agri-Energy, LLC, hereinafter refereed to as GRANTEES.

 

WITNESSETH: In consideration of ONE DOLLAR ($1.00) and other good and valuableconsideration paid by Grantee, the receipt and sufficiency of which is herebyacknowledged, Grantor does, subject to its interest in the within describedreal property, hereby grant to the Grantee, its successors, and assigns, aperpetual alienable easement and right of way with the right to erect,construct, install, lay and thereafter us, operate, inspect, repair, maintain, replaceand remove a railroad spur line for as long as said railroad spur is operatedand/or maintained, over and across said property owned by Grantor in AndersonCounty, Kansas, described as follows:

 

Commencing at 1/2” rebar at the SoutheastCorner of the Southwest Quarter of Section 30, Township 20 South, Range 20East of the Sixth Principal Meridian, City of Garnett, Anderson County, Kansas;THENCE North 02 degrees 14 minutes 48 seconds West for a distance of 798.23feet along the East line of said Southwest Quarter; THENCE North 70 degrees 59minutes 38 seconds West for a distance of 51.33 feet to the East line of theRail Road Depot as described in Deed Book 16, Page 605 the POINT OFBEGINNING; THENCE North 70 degrees 59 minutes 38 seconds West for a distance of301.01 feet to the West line of said Rail Road Depot; THENCE North 12 degrees22 minutes 55 seconds East for a distance of 60.40 feet along said West line;THENCE South 70 degrees 59 minutes 38 seconds East for a distance of 305.09feet to the east line of said Rail Road Depot; THENCE South 16 degrees 15minutes 12 seconds West for a distance of 60.06 feet to the POINT OFBEGINNING.  Together with and subject tocovenants, easements, and restrictions of record.  Said property contains18182.9 square feetmore or less in Anderson County, Kansas, as shown on survey by Taylor DesignGroup, P.A., dated March, 2005.

 

1.                                       Saidgrant is for the benefit of the Grantee, its successors an assigns, andincludes the right to ingress or egress over and across any state propertyadjacent to the easement to cut, trim, and /or control any weeds, trees,shrubbery, or brush that may endanger the use of the railroad spur or thesafety of persons utilizing the Rail Trail that crosses the easement, whichingress and egress shall require the advance permission of the state parkmanager, which permission shall not be unreasonably withheld.

 

2.                                       TheGrantor herein retains the right to use said lands for nay and all otherpurposes, including as a recreational area.

 
|   | [STATE OF KANSAS                                                                                                      |
|--------|-----------------------------------------------------------------------------------------------------------------------|
|   | SS:                                                                                                                   |   |
|   | COUNTY OF ANDERSON                                                                                                    |
|   | This instrument was filed for                                                                                         |
|   | record on the 7th day of April,                                                                                       |
|   | 2005, at 3:40 o’clock p.m., and                                                                             |
|   |  duly recorded in Book 77 of MCL                                                                                 |
|   | at page 59.                                                                                                      |
|   | /s/ Sandra J. Baugher                                                                                                 |   |
|   | Register of Deeds                                                                                                     |
|   |                                                                                                                  |   |
|   | Deputy                                                                                                                |
|   | Fees, $24.00                                                                                                          |
|   |                                                                                                                  |
|   | Entered in Transfer Record in my                                                                                      |
|   | Office this       day of             2005. |
|   |                                                                                                                  |   |
|   | County Clerk                                                                                                          |
|   | Stamped: Register of Deeds]                                                                                           |
|        |                                                                                                                       |  |  |  |

 

3.                                       Granteeby acceptance of this easement hereby acknowledges and agrees that Granteeshall notify Grantor by written notice fourteen days in advance of routinemaintenance to occur within the easement area.

 

4.                                       Granteeshall maintain such easement in a state of good repair and efficiency so thatno unreasonable damages will result from its use of Grantor’s premises.

 

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5.                                       TheGrantee shall repair any damages due to construction, operation, maintenance,or removal of all roads, trail, structures, fences, driveways, and vegetation.

 

6.                                       Allconstruction that effects a temporary change in grade or otherwise creates anysituation that could result in injury to persons or property shall bebarricaded properly to prohibit access to the construction area. Should theTrail Crossing be closed for construction or maintenance, an alternativecrossing, approved by Grantor shall be made available by the Grantee working inconjunction with Grantor or its authorized representatives.

 

7.                                       Noconstruction debris shall be stored on Grantor’s property without prior writtenauthorization, no trash or other construction debris shall be burned on-site,and all rock unearthed during construction shall be removed from the premises.

 

8.                                       Thetrail crossed by the Right of Way shall be leveled back and returned to itsoriginal condition. At the location where the railroad spur crosses the RailTrail, the crossing shall be on grade level, and the crossing shall becompliant with the requirements of the Americans With Disabilities Act. Thecrossing shall consist of pre-cast concrete with a non-slip surface acceptableto the Grantor. Grantee shall install and maintain audible and visible signs onGrantor’s property to alert Rail Trail users of an oncoming train, which signsshall be constructed in accordance with detailed plans under seal of anengineer licensed to practice in Kansas, and shall be approved by Grantorbefore commencement of the installation of signage. Grantor shall provideelectrical power to operate these signs.

 

9.                                       Granteeagrees, as a part of the consideration for this easement, to re-route access tothe west side of the Rail Trail, and to provide parking spaces to replace thosespaces that will be lost due to the railroad spur easement passing across theparking lot east of the Rail Trail. Grantee has prepared preliminary plansshowing the re-routing of an access road and the relocation of parking spaceswhich preliminary plans are incorporated herein, provided, however, that priorto the actual construction of these improvements, Grantee will submit detailedplans for the construction of such improvements, together with the constructionof the rail spur, under seal of an engineer licensed to practice in Kansas,which plans shall be subject to the approval of the Grantor prior tocommencement of construction, which approval shall not be unreasonablywithheld. In no case shall construction commence until Grantor has approved thedetailed construction plans so submitted. The plans shall reflect that Granteewill place no above ground structures or improvements upon the easement exceptfor markers at property lines, fence lines, and road crossings. The plans shallfurther provide for Grantee to construct a fence of materials approved by theGrantor in an easterly and westerly direction along the north and southboundaries established by the easement’s crossing State Park Property for thepurpose of impeding any person’s approach to the railroad track itself from theadjoining State Park property.

 

10.                                 TheGrantee shall provide 60 days written notice to the Grantor prior to thecommencement of construction, installation, or substantial repairs within theeasement, which written notice shall include detailed plans for theconstruction, installation, or repairs, to include an engineer’s seal of anengineer licensed to practice in Kansas. In no case shall construction commenceuntil Grantor has approved the detailed construction plans so submitted.

 

11.                                 Inthe event of a *bona fide*emergency,the Grantee may make such repairs deemed immediately necessary by the Granteeto alleviate or mitigate the emergency situation without Grantor’s prior written consent.  When any such emergency action shall be takenby Grantee without Grantor’ s written consent, Grantee shall make an immediatereport to Grantor, explaining the nature of such emergency, together with arequest for written consent for further or permanent repair or maintenancework. At all times Grantee shall take reasonable steps to protect Grantor’sproperty, including improvements, fixtures, and trail surface within theEasement Area and insure the safety of patrons using the trail.

 

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12.                                 Ifthe railroad spur is not operated or maintained by Grantee or its successors orassigns for a period of one calendar year after its first use, the easementinterest in the lands covered by this Easement shall be deemed abandoned andshall automatically revert to the Grantor or then owner of said lands and shallmerge with Grantor’s ownership. In the case of such abandonment of theEasement, Grantee hereby agrees, if so requested, to execute an instrument inrecordable form evidencing such abandonment and reversion to Grantor.

 

13.                                 Thisgrant shall not be assigned, sold, transferred, leased, or otherwise conveyedto a third party without first obtaining the written consent of Grantor, whichconsent shall not be unreasonably withheld. In the event one of Grantee’slenders institutes foreclosure proceedings against Grantee, Grantor shall beadvised of such proceedings and its consent obtained before said lender conveysGrantee’s assets to a third party.

 

14.                                 Theparties acknowledge that the subject property is property that has been railbanked pursuant to 16 U.S.C. 1247(d), that Grantor does not have fee simpletitle to the property; that Grantor is, by this Agreement, authorizing the useof the property by Grantee for so long as Grantor remains in possession andcontrol of the property; that rail banked property is subject to being returnedto rail service; and that in the event this property is returned to railservice, Grantee will be required to deal with the carrier that reestablishesrail service in order to continue making use of this easement.

 

15.                                 Theeasement has been reviewed and cleared by the Kansas State HistoricPreservation Officer, however, should any historical artifacts be uncoveredduring the construction phase, work will immediately cease and notificationwill be provided to the Grantor of such findings. Work may not resume untilfurther clearance is afforded from the Kansas Historical Preservation Officer.

 

16.                                 Ifthere is a substantial change in the use of the trail or of the railroad spurthat impacts the safety of persons using the trail, sixty (60) days writtennotice of such change shall be provided to the other party, together with aproposal for modifications to this Easement to address the changed usage andsafety issues created thereby, and the parties will thereafter negotiate ingood faith for the purpose of modifying the easement to address the issues soraised. Any modifications must be mutually approved in writing, which approvalshall not be unreasonably withheld by either party.

 

17.                                 Grantorshall provide written notice to Grantee if it deems the Grantee to be innon-compliance with any of the terms of this Agreement. Grantee shall have 30days after receipt of this notice to commence correcting the default, whichwork shall continue without interruption until it is completed. If Granteefails to comply to the stated provision after thirty days, Grantee shall bedeemed to have abandoned said easement interest. In the case of suchabandonment of the Easement, Grantee, its successors, assigns, lessees,affiliates, or agents, hereby agree, if so requested, to execute an instrumentin recordable form evidencing such abandonment and reversion to Grantor.

 

18.                                 Granteeagrees to comply with all State and Federal law relating to the exercise ofrights herein granted.

 

19.                                 Equalopportunity to participate in and benefit from programs described herein isavailable to all individuals without regard to their race, color, religion,national origin or ancestry, sex, age or disability. Complaints of discriminationshould be sent to the Office of the Secretary, Kansas Department of Wildlife &Parks, 1020 S. Kansas, Suite 200, Topeka, Kansas 66612.

 

20.                                 Theprovisions found in Contractual Provisions Attachment (for DA-146a), identifiedas Attachment 1, are hereby incorporated in this Agreement. In the event any ofthe provisions of this Permit are deemed to be invalid or unenforceable, thesame shall be deemed severable from the remainder of the Permit. If suchprovision shall be deemed invalid due to its scope and breadth, such provisionshall be deemed valid to the

 

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extent of the scope and breadth permitted bylaw.

 

Grantee agrees to indemnify and hold Grantorharmless from and against all third party claims which may result from theconstruction, operation and maintenance of said railroad spur by Grantee, itsagents, assigns or subcontractors, including but not limited to, injuries ordeaths of persons, animals, court costs and attorneys’ fees.

 

21.

Address for written notice:

 

Grantor:                                                     RegionalPark Supervisor

Kansas Department of Wildlife and Parks

300 SW Wanamaker

Topeka, Kansas 66606

 

Grantee:                                                    EastKansasAgri-Energy, LLC

William R. Pracht,

Chairperson 121 1/2 East

Fourth Avenue P.G. Box 225

Garnett, Kansas 66032

 

It is agreed that the foregoing is the entireagreement between the parties hereto, and that this written agreement iscomplete in all its terms and provisions. The term of this agreement shallconstitute covenants running with the land and shall be binding upon and inureto the benefit of the parties hereto, their successors, assigns, lessees,affiliates or agents. This easement and right-of-way shall be effective uponacceptance by the Grantee (as evidenced by the signatures below) and the filingof the easement in the official records of the Anderson County Register.ofDeeds.

 

IN WITNESS WHEREOF, said Grantor has executedthis instrument this           day of April,2005.

 
|                                                              | STATE OF KANSAS, by and through,        |
|-------------------------------------------------------------------|-----------------------------------------|
|                                                              | KANSAS DEPARTMENT OF WILDLIFE AND PARKS |
|                                                              |                                    |
|                                                              |                                    |
|                                                              | By:                                     | /s/ J Michael Haden |   |
|                                                              |                                    | J. Michael Hayden, Secretary |
| STATE OF  KANSAS        ) |                                    |   |
| )SS:                                                              |                                    |   |
| COUNTY OF SHAWNEE)                                                |                                    |   |

 

BE IT REMEMBERED, that on this 5 day ofApril, 2005, before me, the undersigned, a Notary Public, in and for the countyand state aforesaid, came J. Michael Hayden, who in his capacity as Secretaryof the Kansas Department of Wildlife and Parks is personally known to be thesame person who executed the within instrument of writing in such capacity andsuch person duly acknowledged the execution on behalf of the State of Kansas,by and through the Kansas Department of Wildlife and Parks.

IN WITNESS WHEREOF, I have hereunto set myhand and affixed my notarial seal the day and year last above written.

 
| Term Expires:                                  |                |
|------------------------------------------------|---------------------|
|                                           |                |
| [Notary Stamp: Donna L. Eberly                 | /s/ Donna L. Eberly |   |
| Notary Public, State of Kansas, My Appt.  Exp. | 04-05-05            | ] |  Notary Public |
|                                                |                     |  |  |  |

 

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ACCEPTANCE OF RIGHT OF WAYEASEMENT

 

The East Kansas Agri-Energy, LLC, Board ofDirectors authorizes the below signatory to accept on behalf of such limitedliability company the foregoing easement and to bind such limited liabilitycompany to the provisions and covenants therein.  East Kansas Agri-Energy, LLC, hereby acceptsthe foregoing easement and agrees to be bound by the provisions and covenantstherein.

 
|   | EAST KANSAS AGRI-ENERGY, LLC                                                                       |
|--------|----------------------------------------------------------------------------------------------------|
|   |                                                                                               |
|   |                                                                                               |
|   | By:                                                                                                | /s/ William R. Pracht |   |
|   |            William  R. Prafcht, Chairperson |

 

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