**Exhibit 10.3**

 

**FACILITY USE AGREEMENT**

 

**No. 6723-00-51**

 

THIS AGREEMENT, made this day          of                         ,2004, by and between the **Town of Randolph**, Columbia County, Wisconsin (“Municipality”),a municipal corporation, and **United Wisconsin GrainProducers, LLC** (“Industry”).

 

**ARTICLE 1.0– DEFINITIONS**

 

a.                                       “Operator” means the Union Pacific RailroadCompany.

 

b.                                      “Municipality” means the Town of Randolph,Columbia County, Wisconsin.

 

c.                                       “WisDOT” means the Wisconsin Department ofTransportation.

 

d.                                      “Industry” means United Wisconsin GrainProducers, LLC.

 

e.                                       “Industry Land” means the corridor of realestate owned by Industry upon which the project facility is located at theIndustry plant site in Town of Randolph, Wisconsin and more fully described inAttachment II.

 

f.                                               “Improved Property” means the rails, ties,ballast, track material, switches, and culverts acquired, used or installedwith the proceeds received by the Municipality from the TEA-Rail Agreement.

 

g.                                      “Person” means an individual, a partnership,an association, and bodies politic or corporate.

 

h.                                      “Project Facility” means the industrialrailroad spur constructed under the TEA-Rail Agreement using improved propertyand providing Industry’s plant with access to the Operator’s track.

 

i.                                          “BORAH” means the Bureau of Railroads andHarbors of WisDOT.

 

j.                                          “Industry Track Agreement” means theagreement by and between the Operator and Municipality or Industry, or both,governing the provision of rail service over and the maintenance of the projectfacility.

 

k.                                       “TEA-Rail” means the agreement by and betweenthe Municipality and WisDOT, Identification No. 6723-00-51, setting forth theterms of the

 

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Municipality’s receipt of aTransportation Economic Assistance-Rail grant to construct the projectfacility.

 

l.                                          “Direct Job(s)” means the number of eligiblejobs directly associated with the economic development project and listed onthe application, as reviewed and approved by WisDOT under TRANS 510.

 

**ARTICLE 2.0- PROJECT DESCRIPTION**

 

The Project Facility constructed by the Municipalityon Municipality and/or Industry Land consists of a multiple track, mini railyard railroad spur of initial construction of 8,033 feet and projectedadditions which would total 10,421 feet from the point of the switch on theOperator’s track to the end of the track at Industry’s plant site as shown onAttachment III.

 

**ARTICLE 3.0- USE, TERM AND JOB GUARANTEE**

 

(a)                                  The Municipality grants to Industry the rightto use the Project Facility for the purpose of shipping and receiving materialsfrom and at industry’s plant, provided Industry complies with the terms andconditions set forth in this Agreement. Industry’s right to use the Project Facility shall continue untilterminated pursuant to this Agreement.

 

(b)                                 Industry shall comply with the criteriaestablished in the Direct Jobs Guarantee attached hereto as Attachment I.

 

**ARTICLE 4.0- PROJECT FACILITY LIQUIDATION**

 

In the event the Project Facility is liquidated atany time, the net proceeds received from disposition of the Improved Propertyincluded in the Project Facility shall be distributed as follows: 50% thereofshall be paid to Municipality for reimbursement to WisDOT, and 50% thereofshall be paid to Municipality.

 

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**ARTICLE 5.0- PROJECT FACILITY OPERATION**

 

**Section 5.1.****                                WrittenAgreements**

 

Industry has entered or shall enter into thefollowing written agreements with appropriate parties to assure its ability tocomply with the requirements of this Agreement. These agreements shall be submitted in approvable form to theMunicipality by Industry, so the Municipality may submit them to BORAH foracceptance.  If Industry fails to complywith this provision or BORAH does not accept said written agreements, this Agreementis automatically terminated.

 

(a)                                  Industry shall furnish a track easement tothe Municipality on Industry Land (as described in Attachment II) granting theMunicipality a perpetual right for construction, operation and ownership of theProject Facility on said land.

 

(b)                                 Industry shall provide an Industry TrackAgreement by and between Municipality or Industry, or both, and Operator. SaidIndustry Track Agreement shall be attached hereto as Attachment III and made apart of this Agreement as of the date Attachment III is accepted in writing byBORAH.

 

**Section 5.2.****                                Maintenanceof Project Facility**

 

Industry shall, at its expense, perform or arrangefor performance of all maintenance and repairs of the Project Facility, theroad bed of the Project Facility, drainage ways and any structures necessaryfor the safe operation of railroad service as determined by Operator or theFederal Railroad Administration, or both.

 

**Section 5.3.****                                ProjectFacility Use**

 

(a)                                  A defacto condition of default for failure touse may be declared by Municipality or WisDOT upon occurrence of any one ormore of the following events:

 

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(i)                                     Industry renders its loading docks or trackside facilities unfit for use for rail service or ceases its operation of itsplant.

 

(ii)                                  Industry files for protection underbankruptcy laws.

 

(iii)                               Operator abandons the line haul track and/orindustrial lead track to which the Project Facility is connected.

 

(iv)                              Operator ceases operation of line haul trackand/or industrial lead track serving the Project Facility.

 

(v)                                 The Project Facility is rendered unfit forrailroad freight service by Municipality, Industry, or Operator.

 

(b)                                 Industry shall provide to BORAH not laterthan January 20th of each year a report of the number of loaded rail carsshipped or received on the Project Facility by Industry.  Industry shall arrange for access by BORAH orits authorized agent to examine waybill, demurrage, or other appropriate recordsfor purposes of validating reported car counts.

 

**Section 5.4.****                                DefectiveWork**

 

If it is reasonably determined by Industry,Municipality or WisDOT that any material or workmanship is deficient Industry,without reimbursement, shall promptly require the replacement of materials orcorrection of workmanship necessary to cure the deficiency.

 

**ARTICLE 6.0- PROJECT PROPERTY SECURITY, LIENS AND SALE**

 

**Section 6.1.****                                Securityfor Borrowing**

 

(a)                                  Industry shall not itself nor shall it allowOperator to use the value of the Improved Property acquired or used for thisproject as security or collateral for any loan or other borrowing.

 

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(b)                                 Industry shall not use Industry Land assecurity or collateral for any loan or other borrowing which is not recorded inthe office of the Register of Deeds of Columbia County on the date of executionof this Agreement.

 

**Section 6.2****                                   LiensAgainst Improved Property**

 

(a)                                  Industry acknowledges that the TEA-RailAgreement creates a first priority lien in favor of WisDOT on the materialpurchased in whole or in part with the proceeds of the TEA-Rail Agreementbeginning with acceptance of delivery and continuing for the duration of theirplacement on Industry Land, and that the Municipality shall cause a legallysufficient notice of this lien to be recorded in the office of the Register ofDeeds of Columbia County, the Wisconsin Department of Financial Institutions,and shall notify BORAH when recording is accomplished.  Said notice shall be removed from the recordonly upon written waiver of lien by WisDOT.

 

(b)                                 Industry shall not directly or indirectlycreate, incur, assume, or suffer to exist any mortgage, pledge, lien, charge,encumbrance, or other security interest or claim on or with respect to theImproved Property or any interest therein not in existence on the date ofexecution of this Agreement. Industry shall immediately take such action as maybe necessary to duly discharge any such mortgage, pledge, lien, charge,encumbrance, security interest, or claim against Improved Property if the sameshall arise at any time.

 

**Section 6.3.****                                Saleof Improved Property or Industry Land**

 

In the event Industry sells the Improved Property orIndustry Land, or both, without the written approval of BORAH, which approvalshall not be unreasonably withheld, Industry shall immediately pay to theMunicipality an amount equal to the amount the Municipality is required torepay to WisDOT from the TEA-Rail grant as a result of said sale.

 

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**ARTICLE 7.0- DEFAULT AND TERMINATION**

 

**Section 7.1.****                                Declarationof Default**

 

A condition of default exists under this Agreementwhen either party to this Agreement fails to abide by or perform according toany one or more of its terms and conditions. A declaration of default of this Agreement shall be made in writing anddelivered to the alleged defaulting party by certified mail sent to the addressshown in Section 10.2.  The lettershall identify the action or inaction constituting the default and referencethe portion of the Agreement under which the default occurs.  The date of default shall be the date ofdelivery of notice or the date insurance coverage fails to meet requirements orthe date of filing for bankruptcy by Industry, whichever first occurs.

 

**Section 7.2.****                                Terminationof Default**

 

In the event of any failure on the part of eitherparty to perform its obligations under the terms of this Agreement, including,but not limited to, transmittal of required payments under this Agreement, theother party shall have the right to give immediate notice of default and, atits option, after first giving ten (10) days written notice thereof bycertified mail to the party in default and notwithstanding any waiver by theparty giving notice of any prior breach thereof, to terminate this Agreement,and the exercise of such right shall not impair any other rights of the parrygiving notice under this Agreement or any rights of action against thedefaulting party for the recovery of damages.

 

**Section 7.3.****                                Removalof a Condition of Default**

 

The Municipality or Industry shall have ten (10)calendar days from written notification of the default to remove or remedy thecause of the default.  This remedy period

 

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maybe waived by the party declared in default. Correction by the defaulting partyshall be completed and ready for verification by the other party within the ten(10) day period.  Upon written petitionby the defaulting party, the other party may extend the period for removal of adefault condition.  The defaulting partyshall be notified of satisfactory correction in writing.

 

**Section 7.4.****                                Expensesof Termination**

 

The parties shall themselves, and Industry shallrequire Operator, to mitigate the expenses of termination to the greatestextent possible, and the Municipality shall pay those that do occur if defaultis caused by Municipality, and Industry shall pay those that do occur ifdefault is caused by Industry.

 

**Section 7.5.****                                Vacatingthe Property**

 

Upon determination by the Municipality that remedialaction has not removed the default condition caused by Industry, theMunicipality shall provide written notice to Industry and Operator for Industryand Operator to vacate the Project Facility within fourteen (14) days of deliveryof such notice.

 

**Section 7.6.****                                ForceMajeure**

 

The parties hereto will be excused from performanceof any of their respective obligations hereunder, for the duration of anyinterruption occasioned by any event beyond their respective control (not due totheir own fault or actions), which shall include, without limitations: Acts ofGod; strikes or other labor troubles or other causes except the unavailabilityof insurance coverage in full accordance with Section 9.2 of thisAgreement or any amendment thereto, beyond the reasonable control of theparties; interruption of service 

 

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causedby accidents, explosions, fires, vandalism, or malicious mischief.  To the extent permitted by WisDOT, theparties will be excused from the performance of their obligations hereunder ofthe parties’ failure to use the Project Facility is due to the economic orbusiness conditions of Industry or the failure of Operator to provide freightcars or switching service.

 

**Section 7.7.****                                Costof Collection**

 

In the event of default of any provision of thisAgreement, in addition to any other remedies to which the non-defaulting partymay be entitled, the defaulting party shall pay all of the non-defaulting party’scosts and expenses of enforcing this Agreement, including all reasonableattorneys’ fees and expenses, whether incurred prior to or after commencementof any lawsuit.

 

**ARTICLE 8.0REPRESENTATIONS AND WARRANTS**

 

The parties hereto represent and warrant that theyhave the power and authority to enter into this Agreement and to carry outtheir obligations under this Agreement.

 

**ARTICLE 9.0- LIABILITY AND INSURANCE**

 

**Section 9.1.****                                HoldHarmless**

 

Industry shall save and hold the Municipality andWisDOT, their officers, employees and agents harmless from and against allliability, damage, loss, claims, demands and actions of any nature whatsoeverwhich arises out of or are connected with, or are claimed to arise out of or beconnected with, any act, omission or operation of Industry or Operator, orIndustry’s or Operator’s agents, servants, subcontractors or employees, orwhich arises out of or is connected with, or is claimed to arise out of or beconnected with any accident or occurrence which happens or is alleged to havehappened, in or about a

 

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placewhere such operation, act or omission is being performed or in the vicinitythereof (1) while Operator or Industry is performing its work, or (2) duringthe period this Agreement between Industry and Municipality is in effect, or(3) while any of the Operator’s or Industry’s property, equipment, orpersonnel, is in or about such place or the vicinity thereof by reason of or asa result of the performance of Operator’s or Industry’s operations including,without limiting the applicability of the foregoing: all liabilities, damages,losses, claims, demands and actions on account of personal injury, death orproperty loss to the Municipality or WisDOT, their, officers, employees,agents, subcontractors, or frequenters, or to any other person or legal entitywhether based upon, or claimed to be based upon contract, tort, or having itsbasis in workers’ compensation under federal or state statutes or having anyother code, or statutory basis, or based upon administrative laws or otherprovisions, or other liability of the Municipality or WisDOT, Industry or anyother persons or entities, and whether or not caused or claimed to have beencaused by the negligence, or other breach of duty by the Municipality orWisDOT, their officers, employees, agents, subcontractors, or frequenters, orIndustry, its officers, employees, agents, subcontractors or frequenters, orany other person or legal entity. Without limiting the applicability of the foregoing, the liability,damage, loss, claims, demands and actions indemnified against shall include allliability, damage, loss, claims, demands and actions for trademark, copyrightor patent infringement, for unfair competition or infringement of any so-called“intangible” property right, for defamation, false arrest, maliciousprosecution or any other infringement of personal or property rights of anykind whatsoever.

 

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**Section 9.2.****                                Insurance**

 

(a)                                  Required Coverage - During the term of this Agreement,Industry shall maintain, at its own cost and expense, a Comprehensive GeneralLiability Policy in an amount of not less than $1,000,000.00 single limitcoverage, and for matters of liability arising from the existence and use ofthe Project Facility, shall name the Municipality and WisDOT, their officers,employees, and agents as additional insureds on all Primary and ExcessComprehensive General Liability insurance documents. Industry shall, inaddition, maintain and keep in force worker’s compensation and employer’sliability insurance, to the extent, if any, that worker’s compensation andemployer’s liability is not covered under the Comprehensive General LiabilityPolicy.

 

(b)                                 Validation of Coverage and Notice of Cancellation - Upon initial inclusion of the Municipalityand WisDOT as additional insureds and on each renewal of insurance coveragerequired by Section 9.2(a), the insurance carrier shall provide to theMunicipality and WisDOT written documentation from the insurance carrier or itsauthorized representative of the terms and effective date of coverage. In theevent of insurance coverage suspension or insurance cancellation by anyinsurance carrier, both the insurance carrier and Industry shall provide the Municipalityand WisDOT with notification of such suspension or cancellation of insurancecoverage required by Section 9.2(a) no less than 10 days prior to suchsuspension or cancellation.

 

(c)                                  Reporting of Incidents and Claims - During the term of this Agreement, anydamage or injury to person or property occurring on the Project Facility orfrom the operation of the equipment of Operator or Industry or by the employeesof Operator or Industry (herein referred to as an “incident”) shall be reportedto the Municipality and WisDOT at such time

 

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assaid incident is reported to any regulatory agencies or Industry’s insurancecarrier. Industry and Operator shall forthwith furnish the Municipality andWisDOT with copies of any notice of injury or claim of damage made to Industryor Operator.  Thereafter, Industry andOperator shall provide the Municipality and WisDOT access to copies of anyfurther instruments, reports and records involving such matter and shall report,at least quarterly, to the Municipality and WisDOT as to further happeningsregarding the incident including the final disposition of the matter. Notice ofcourt dates shall be given to the Municipality and WisDOT upon receipt.

 

**ARTICLE 10.0- GENERAL CONDITIONS**

 

**Section 10.1.****                         Choiceof Law**

 

This Agreement shall be interpreted in accordancewith the statutes and laws of the United States of America and the State ofWisconsin. Interpretation may be had in any court of record of the County ofColumbia.

 

**Section 10.2.****                         Notice**

 

(a)                                  Any notice required or permitted under thisAgreement shall be personally served or mailed by certified United States mail,return receipt requested, postage prepaid, to the following addressed personsat the following addresses and to such other persons and addresses as thefollowing persons shall direct by notice pursuant to this Section:

 
| **Town of  Randolph** | **United  Wisconsin Grain Producers, LLC** |
|-----------------------|--------------------------------------------|
| W1441 Vaughn Road     | Post Office Box 247                        |
| Cambria, WI 53923     | Friesland, WI 53935-0247                   |

 

(b)                                 Any notice provided under Section 10.2(a)shall be provided to the following by first class mail.

 

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| Director, Bureau of Railroads & Harbors | President                           |
|---------------------------------------------|-------------------------------------|
| **WI  Dept. of Transportation**             | **Union  Pacific Railroad Company** |
| P.O. Box 7914                               | 1416 Dodge Street                   |
| Madison, WI 53707-7914                      | Omaha, NB 68179                     |

 

**Section 10.3.****                         Transferof Rights Under This Agreement**

 

This Agreement shall be binding upon and inuresolely to the benefit of the parties hereto. Industry’s or Operator’s rightshereunder shall not be assignable whether by way of assignment, sublease,license or otherwise, directly or indirectly without the Municipality’s prior,written consent.

 

**Section 10.4.****                         Severability**

 

If any term, covenant, condition or provision (orpart thereof) of this Agreement, or the application thereof to any party orcircumstance, shall at any time or to any extent be held to be invalid orunenforceable, the remainder of this Agreement, or the application of such termor provision, or remainder thereof, to parties or circumstances other thanthose as to which it is held to be invalid or unenforceable, shall not beaffected thereby, and each term, covenant, condition and provision of thisAgreement shall be valid and be enforced to the fullest extent permitted bylaw.

 

**Section 10.5.****                         Amendment,Consents and Approvals**

 

(a)                                  No term or provision of this Agreement, orany of its attachments, may be changed, waived, discharged or terminated,except by an instrument in writing signed by both parties to this Agreement.

 

(b)                                 Consents and approvals required under thisAgreement and interpretation of this Agreement may be made or granted by letterfrom one party to the other party hereunder or by an exchange of lettersbetween the parties.

 

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**Section 10.6.****                         Officials**

 

(a)                                  Officials authorized to execute amendments ormodifications to this Agreement on behalf of the Municipality are the TownChairman and the Town Clerk.

 

(b)                                 Officials authorized to execute amendments ormodifications to this Agreement on behalf of Industry are the President andSecretary.

 

**Section 10.7.****                         Handicapped**

 

No otherwise qualified handicapped individual in theUnited States, as defined in Section 706(7) of Title 29 USC, andsubchapter II of Chapter 111, Wis. Stats., shall solely by reason of theindividual’s handicap, be excluded from the participation in, be denied thebenefits of, or be subjected to discrimination under any program or activityreceiving benefits under this Agreement.

 

**Section 10.8.****                         EnvironmentalProtection**

 

(a)                                  Industry agrees to conduct work under thisAgreement in compliance with all applicable Wisconsin Environmentalrequirements. Industry will complete a Wisconsin Department of TransportationProgrammatic Environmental Report and provide WisDOT with copies of approvalletters from the Wisconsin Department of Natural Resources, the Wisconsin StateHistorical Society, or other state or federal agency who may have reviewed thusproject for environmental reasons, prior to execution of this Agreement byWisDOT.  This report and letters shallbecome part of this Agreement.

 

(b)                                 Facilities or equipment shall not beacquired, constructed, or improved as a part of the Project Facility unlesssuch facilities or equipment are designed and equipped to

 

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limitwater and air pollution in accordance with all applicable state and federalstandards, statutes, and regulations.

 

(c)                                  Operations shall be conducted in compliancewith all the requirements of Section 114 of the Clean Air Act, 42 USC sec.7414, and Section 308 of the Federal Water Pollution Control Act, 33 USC1318, and all applicable regulations issued under said Acts.

 

(d)                                 Industry certifies that no facilities, whichwill be utilized or improved as part of the Project Facility, are listed on theEnvironmental Protection Agency (“EPA”) List of Violating Facilities (“List”).

 

(e)                                  Industry shall notify the Municipality assoon as it, the Operator or any subcontractor receives any communication fromthe EPA indicating that any facility which will be utilized or improved as partof the Project Facility is under consideration to be listed on the EPA List.

 

**Section 10.9.****                         ProhibitedInterests/Conflicts of Interest:**

 

(a)                                  Neither Municipality, Industry nor Operator,nor any of their subcontractors shall enter into any contract, subcontract, oragreement in connection with the project or any property included or planned tobe included in the Project Facility in which any director, officer or employeeof Municipality during his or her tenure or for one (1) year thereafter has anyinterest, direct or indirect, except as permitted under Sec. 946.13(2), Wis.Stats. (2001-2002).

 

(b)                                 No director, officer, or employee ofMunicipality, during his or her tenure or for one (1) year thereafter shallhave any interest, direct or indirect, in this contract or the proceeds thereofexcept as permitted under Sec. 946.13(2), Wis. Stats. (2001-2002).

 

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(c)                                  No subcontractor of Municipality or Industrymay enter into any contract, subcontract or other arrangements which may affectthe activities for which assistance is available to the Municipality under theTEA-Rail Agreement if any director, officer, any key salaried employee orofficial, or any member of the immediate family of one of the foregoing has anymaterial interest in said Agreement.

 

(d)                                 The provisions of this subsection shallnot be applicable to any agreement between Municipality or Industry and itsfiscal depositories or to any agreement for utility services for which ratesare fixed by government regulation.

 

**Section 10.10.****                  Non-Discrimination**

 

(a)                                  In connection with the performance of workunder this Agreement or the TEA-Rail Agreement, Industry agrees not todiscriminate against any employee or applicant for employment because of age,race, religion, color, handicap, sex, physical condition, developmentaldisability as defined in Sec. 51.01(5), Wis. Stats., sexual orientationor national origin.  This provision shallinclude, but not be limited to, the following: employment, upgrading, demotionor transfer, recruitment or recruitment advertising; layoff or termination;rates of pay or other forms of compensation; and selection for training,including apprenticeship.  Except withrespect to sexual orientation, the contractor further agrees to takeaffirmative action to ensure equal employment opportunities. Industry agrees topost in conspicuous places, available for employees and applicants foremployment, notices setting forth the provisions of the nondiscriminationclause.

 

(b)                                 Municipality shall comply with the followinglaws, policies, regulations and pertinent directions as may be applicable andwill require their subcontractors through contractual agreement to similarlycomply

 

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(i)                                     Title VI of the Civil Rights Act of 1964, 78Stats. 252, 42 U.S.C. 2000d et seq.

 

(ii)                                  Subchapter II of Chapter 111, Wis. Stats.

 

(iii)                               Section 16.765, Wis. Stats.

 

(c)                                  Municipality in the procurement process,shall not discriminate against minority owned or operated firms qualified tobid and perform on contracts, subcontracts, or materials procurement connectedwith the work performed under this Agreement or the TEA-Rail Agreement.

 

**Section 10.11.****                  Assurance**

 

Municipality shall require its constructioncontractor to acquire a performance and payment bond or an irrevocable letterof credit in the full amount of the grant to the Municipality under theTEA-Rail Agreement in favor of Municipality for the duration of theconstruction work set forth under said Agreement.

 

**Section 10.12.****                  SpecificPerformance**

 

The Municipality shall have the right, as providedby law, to require specific performance by Industry of Industry’s obligationsunder this Agreement.  This right may beasserted at any time after thirty (30) days of the Municipality notifyingIndustry of its obligation to perform.

 

**Section 10.13.****                  EntireAgreement**

 

This Agreement and the attachments hereto containthe entire agreement of the parties and supersede any and all prior agreementsor oral understandings between the parties.

 

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**SIGNATURES**

 

IN WITNESS WHEREOF, the parties hereto have causedthis Agreement to be executed by their duly authorized officers on the date andyear designated in this Agreement.

 
|     | **TOWN OF  RANDOLPH** |
|----------|-----------------------|
|     |                  |
| WITNESS: | /s/ Brad Bruxvoort    |   | By: | /s/ David Hughes |   |
|     |                  |   |   | **David  Hughes,** Town  Chairman |   |
|     |                  |   |   |   |   |
| WITNESS: | /s/ Brad Bruxvoort    |   | By: | /s/ Rodney Kok |   |
|     |                  |   |   | **Rodney  Kok,** Town Clerk |   |
|     |                  |   |   |   |   |
|     |                  |   | **UNITED  WISCONSIN GRAIN** |
|     |                  |   | **PRODUCERS,  LLC** |
|     |                  |   |   |   |   |
| WITNESS: | /s/ Suzanne Wendt     |   | By: | /s/ Kevin Roche |   |
|     |                  |   | * | President |   |
|     |                  |   |   |   |   |
| WITNESS: | /s/ Suzanne Wendt     |   | By: | /s/ Bob Lange |   |
|     |                  |   | * | Sect. |   |

 

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FUA

AgreementNo.               6723-00-51

 

 

**ATTACHMENT I**

 

**TRANSPORTATION ECONOMIC ASSISTANCE JOB GUARANTEE**

 

 

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| DT1236 | Wisconsin Department of  Transportation |
|--------|-----------------------------------------|

 

**TRANSPORTATION ECONOMIC ASSISTANCE**

 

**JOB GUARANTEE**

 

TheTOWN OR RANDOLPH, COLUMBIA COUNTY, hereby agrees to authorize inclusion and bebound by this repayment provision in the Project Agreement that will beexecuted between the applicant and the Wisconsin Department of Transportationas part of the Department’s approval of the applicant’s request for assistanceunder the Transportation Facilities Economic Assistance and Development (TEA)program.

 

TheVILLAGE OF CAMBRIA agrees, in this repayment provision, to reimburse theDepartment up to the full grant amount if employment within the economic developmentproject (RANDOLPH (TOWN)/UNITED WISCONSIN GRAIN PRODUCERS. LLC MINI RAILYARD CONSTRUTION) fails to meet the following goals: (1) expansion ofemployment by 32 jobs in three years after A Rail Project Agreement isexecuted; and, (2) retention of these 32 jobs for another 4 years(verifications to be made at 3 and 7 years after Rail Project Agreement isexecuted).

 

Forpurposes of this provision, a job is defined to be consistent with Trans. 510of the Wisconsin Administrative Code.  Itwill include all new non-retail jobs and exclude jobs obtained throughgeographic job transfers within Wisconsin except those that would be lost tothe state. Eligible jobs may include full time equivalents (FTE’s).

 

Ifthe job guarantee is not satisfied, the Department will evaluate the jobbenefits that have been obtained in order to determine if reimbursement ofeither the full grant amount or reimbursement of a reduced amount based on aprorated share related to the number of jobs that have materialized as a resultof the economic development project is appropriate.

 

Thefull grant amount involved here, of which partial or total reimbursement may berequired, is $160,000.

 

 
| /s/ Frank J. Busalacchi |   | /s/ Dave Hughes             |   |
|-------------------------|--------|-----------------------------|--------|
| (Name)                  |   | (Name)                      |   |
|                    |   |                        |   |
| FRANK J. BUSALACCHI     |   | DAVE HUGHES                 |   |
| SECRETARY,              |   | CHAIRMAN                    |   |
| WISCONSIN DEPARTMENT    |   | TOWN OF RANDOLPH 53935-0247 |
| OF TRANSPORTATION       |   |                        |   |
|                    |   |                        |   |
| 9-15-04                 |   | 8-23-04                     |   |
| (Date)                  |   | (Date)                      |   |

 

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FUA

AgreementNo.               6723-00-51

 

 

**ATTACHMENT II**

 

**RAILROAD SPUR EASEMENT AGREEMENT**

 

 

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| RAILROAD SPUR      |   |
|--------------------|--------|
| EASEMENT AGREEMENT |   |

 

 
|   | ** **                                        |   |
|--------|---------------------------------------------------|--------|
|   | **Name  & Return Address:**                   |
|   | Attorney Lan Waddell                              |
|   | WADDELL OF COLUMBUS, SC                           |
|   | P. O. Box 407                                     |
|   | Columbus, WI 53925                                |
|   |                                              |
|   | **Parcel  Identification Numbers:**535.01, 535.02 |

 

Railroad Spur Easement Agreement (“Agreement”)effective as of                             ,2004 by and between **United Wisconsin GrainProducers, LLC**(“UWGP”) and **Town of Randolph**, amunicipal corporation (“Town”).

 

**RECITALS**

 

A.                                   UWGP is the fee simple owner of certain realproperty in the Town of Randolph, Columbia County, State of Wisconsin, moreparticularly described as follows:

 

Lots 1 and 2, Certified Survey Map No. 4050; beingpart of the NW 1⁄4 NW 1⁄4 of NE 1⁄4 NW 1⁄4, the SE 1⁄4 NW 1⁄4 of SW 1⁄4 NW 1⁄4, Section 27,Township 13 North, Range 12 East, Town of Randolph, Columbia County, Wisconsin(the “Property”).

 

B.                                     Town and Wisconsin Department ofTransportation are parties to a Transportation Economic AssistanceAgreement-Rail (“TEA-Rail”), Identification No. 6723-00-51, that contains theterms and conditions of a Transportation Economic Assistance-Rail grant to Townfor construction by Town of an industrial railroad spur on the Property(“Project Facility”).

 

C.                                     Pursuant to a Facility Use Agreement betweenTown and UWGP dated                            ,2004 (“FUA”), UWGP is to furnish to Town a track easement for the right toconstruct and operate the Project Facility on the following described portionof the Property (“Easement Area”):

 

**Seeattached Railroad Easement LEGAL DESCRIPTION.**

 

**AGREEMENT**

 

For good and valuable consideration, the receipt andsufficiency of which are acknowledged, the parties agree as follows:

 

1.                                       **Grant of Easement.**  UWGP grants to Town a perpetual easement andright-of-way for the purposes of facilitating the Project Facility on and overthe Easement Area and for the purpose of UWGP gaining access to and from therailroad track owned by Union Pacific Railroad Company

 

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(orits successor) (“Easement”), pursuant to the FUA and TEA-Rail. Town agrees toconstruct the Project Facility no later than June, 2005 (the “Final CompletionDate”). This Easement shall terminate upon termination of the FUA or TEA Rail.

 

2.                                       **Temporary Construction Easement.**  During the period of constructionor installation of the Project Facility on and over the Easement Area, Townshall have a temporary construction easement over those portions of theProperty located within sixty (60) feet of the Easement Area for the purpose oftransporting equipment and materials in connection with the construction orinstallation of the Project Facility on the Easement Area (“TemporaryConstruction Easement”). The Temporary Construction Easement shall expire onthe earlier of (a) completion of the Project Facility as contemplated in Section 1,above; or (b) the Final Completion Date as specified in Section 1, above.

 

3.                                       **Consistent Uses Allowed.** UWGP shall have the right to usethe Project Facility and reserves the right to use the Easement and the TemporaryConstruction Easement for purposes that will not interfere with Town’senjoyment of the Easement rights granted in this Agreement.

 

4.                                       **Restoration of Surface.**  Town shall restore the surfacedisturbed by any construction or maintenance of any equipment located withinthe Easement or the Temporary Construction Easement to its condition before thedisturbance.

 

5.                                       **Covenants Run with Land.**  All of the terms and conditionsin this Agreement, including the benefits and burdens, shall run with the landand shall be binding upon, inure to the benefit of, and be enforceable by UWGPand Town and their respective successors and assigns. Except as otherwiseprovided in the FUA, the party named as UWGP in this Agreement and anysuccessor or assign to UWGP as fee simple owner of the Property shall cease tohave any liability under this Agreement with respect to facts or circumstancesarising after the party has transferred its fee simple interest in theProperty.

 

6.                                       **No Public Dedication.**  Nothing in this Agreement shall be deemed tobe a gift or dedication of any portion of the easements granted under thisAgreement to the general public.

 
| **TOWN OF  RANDOLPH**                                                                                                   | **UNITED  WISCONSIN GRAIN PRODUCERS, LLC** |
|-------------------------------------------------------------------------------------------------------------------------|--------------------------------------------|
|                                                                                                                    |                                       |   |
| By:                                                                                                                     | /s/ David Hughes                           |   | By: | /s/ Kevin Roche |   |
|                                                                                                                    | **David  Hughes**, Town Chairman           |   | * | President |   |
|                                                                                                                    |                                       |   |   |   |
|                                                                                                                    |                                       |   |   |   |   |
| By:                                                                                                                     | /s/ Rodney Kok                             |   | By: | Bob Lange |   |
|                                                                                                                    | **Rodney  Kok**, Town Clerk                |   | * | Sect. |   |
|                                                                                                                    |                                       |   |   |   |
| Subscribed and sworn to before me this 4th day, October,  2004 by the above named person(s) David Hughes and Rodney Kok |                                       | Subscribed and sworn to before me this 4th day, October,  2004 by the above named person(s) Kevin Roche – President and Bob Lange –  Secretary |
| Notary Public, State of Wisconsin                                                                                       |                                       | Notary Public, State of Wisconsin |
| My commission expires 4/22/07                                                                                           |                                       | My commission expires 5/25/08 |
|                                                                                                                         |                                            |  |  |  |  |  |  |

 

This Instrument was Drafted by:

AttorneyLan Waddell

WADDELLOF COLUMBUS, SC

P.O.Box 407

Columbus,WI 53925

 

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**Railroad Easement**

**LEGAL DESCRIPTION**

United Wisconsin Grain Producers

Friesland, Wisconsin

 

Partof the Northwest quarter of Section 27, Township 13 North, Range 12 East,Township of Randolph, Columbia County, Wisconsin, described as follows:

 

Aneasement for railroad spur track and rail car storage yard described asfollows;

 

Commencingat the Northwest corner of said Section 27,

 

thenceN 87°56’05” E along the North line of the Northwest quarter of said section, adistance of 1705.36 feet to a point on the Union Pacific’s Westerly right ofway line and also being the POINT OF BEGINNING,

 

thenceS 4°40’37” E, a distance of 949.88 feet,

 

thenceS 11°49’47” E, a distance of 763.02 feet,

 

thenceS 32°48’59” E , a distance of 231.63 feet,

 

thenceS 26°08’07” E, a distance of 143.89 feet,

 

thenceN 11°50’11” W, a distance of 2061.20 feet to the POINT OF BEGINNING.

 

Saideasement contains 165,282 square feet or 3.79 acres.

 

Thiseasement shall continue in force indefinitely and shall terminate upontermination of the TEA-Rail Agreement with respect to the above described landentered into and between the Town of Randolph and the Wisconsin Department ofTransportation.

 

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FUA

AgreementNo.               6723-00-51

 

 

**ATTACHMENT III**

 

**INDUSTRY TRACK AGREEMENT**

 

 

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ITC IndDev-New Trk 05/01/01

FormApproved, AVP-Law

 

**INDUSTRY TRACK CONTRACT**

**ARTICLES OF AGREEMENT**

 

THIS AGREEMENT is made and entered into as of the     day of                ,2004, by and between UNION PACIFIC RAILROAD COMPANY, a Delaware corporationhaving an address of 1400 Douglas Street, Omaha, Nebraska 68179 (hereinafterthe “Railroad”), and UNITED WISCONSIN GRAIN PRODUCERS, L.L.C., a Wisconsinlimited liability company, to be addressed at Post Office Box 247, Friesland,Wisconsin 53935 (hereinafter the “Industry”).

 

**RECITALS:**

 

The Industry desires theconstruction, maintenance and operation of a 2,150-foot spur Track A,1,300-foot spur Track C, 2,062-foot double-ended Track D, 1,795-footdouble-ended Track E, 1,546-foot double-ended Track F, 1,310-foot double-endedTrack G and future 1,310-foot double-ended Track H (hereinafter collectively“Track”) at or near Milepost 251.1, Adams Subdivision, in Friesland, ColumbiaCounty, Wisconsin, shown on the attached Drawing No. W10033 dated July 21,2004, marked **Exhibit A**, hereto attached and hereby made a parthereof.

 

**AGREEMENT:**

 

NOW, THEREFORE, IT IS MUTUALLY AGREED BY AND BETWEENTHE PARTIES HERETO AS FOLLOWS:

 

Article 1.                                                TRACK IDENTIFICATION MARKERS.

 

For the purpose of this Agreement, the followingsegments of the Track shall be identified as follows:

 

Track A:

 
| Engineering Station 0+00 -  |   | the initial switch connection or sometimes referred to as the point of  switch.                                                                                                                                                                                       |
|-----------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                        |   |                                                                                                                                                                                                                                                                  |
| Engineering Station 1+74 -  |   | the initial 13-foot clearance point of the track. It is the point on  the track where a rail car either being moved or stored on the track will not  interfere with the movement of other rail cars on adjacent main, branch or  lead trackage owned by the Railroad. |
|                        |   |                                                                                                                                                                                                                                                                  |
| Engineering Station 5+01 -  |   | the point on the track that intersects the property line or  right-of-way boundary line of the Railroad.                                                                                                                                                              |
|                        |   |                                                                                                                                                                                                                                                                  |
| Engineering Station 21+50 - |   | the end of Track A.                                                                                                                                                                                                                                                   |

 

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Track D:

 
| Engineering Station 0+00 -  |   | the initial switch connection.                  |
|-----------------------------|--------|-------------------------------------------------|
| Engineering Station 16+51 - |   | the right-of-way boundary line of the Railroad. |
| Engineering Station 18+88 - |   | the southerly 13-foot clearance point.          |
| Engineering Station 20+62 - |   | the end of Track D.                             |

 

Article 2.                                                INDUSTRY-SUPPLIED TRACK MATERIAL.

 

The Industry, at its expense, will furnish loosematerials obtained from a Railroad-approved vendor, for one new No. 11 136-lb.right-hand turnout and one new No. 11 136-lb. left-hand turnout, for assemblyand installation by Railroad forces.

 

Article 3.                                                CONSTRUCTION COST; PAYMENT.

 

A.                                   Upon the execution of this Agreement, theIndustry shall pay the Railroad the sum of TWO HUNDRED FIFTY THOUSAND TWOHUNDRED FIFTY-THREE DOLLARS ($250,253.00), which is the firm cost to theIndustry for construction of that portion of the Track to be constructed by theRailroad, as described in Article 4.

 

B.                                     The Railroad reserves the right to changeconstruction costs and design of the Track if construction is not started bythe Railroad within six (6) months of the date of this Agreement due to delaysimposed by the Industry.

 

Article 4.                                                PORTIONS OF TRACK TO BE CONSTRUCTED BYRAILROAD.

 

The Railroad, in consideration of payment byIndustry of the amount stated in Article 3 of this Agreement, will performthe following work:

 

1.                                       Construct 174 track feet of Track A includingone No. 11 136-lb. right-hand turnout supplied by the Industry, and install aswitch circuit controller at or near Milepost 251.1.

 

2.                                       Construct 174 track feet of Track D includingone No. 11 136-lb. left-hand turnout supplied by the Industry, and install aswitch circuit controller at or near Milepost 251.69.

 

3.                                       Relocate signal pole line underground andperform other signal work as required.

 

Article 5.                                                PORTIONS OF TRACK TO BE CONSTRUCTED BYINDUSTRY.

 

A.                                   The Industry, at its own expense and subjectto the prior approval of the Railroad, will perform all grading and install allnecessary drainage facilities required in connection with the construction ofthe Track to the standards and satisfaction of the Railroad, and arrange tomodify any overhead and/or underground utilities to meet Railroadspecifications.

 

B.                                     The Industry, at its own expense, will alsoperform the following work:

 

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1.                                       Construct the remainder of Track A andinstall a sliding derail with wheel crowder at or near Engineering Station 2+54and a bumper at the end of the track.

 

2.                                       Construct all of Track C including one No. 8turnout.

 

3.                                       Construct the remainder of Track D includingone No. 8 turnout and install a sliding derail with wheel crowder at or nearEngineering Station 18+08.

 

4.                                       Construct all of Track E, Track F, Track G,and future Track H including two No. 8 turnouts for each track.

 

Article 6.                                                RIGHT-OF-WAY AND PRIVILEGE.

 

The Industry shall procure any needed right-of-way,public authority or permission for construction, maintenance and operation ofthe Track outside the limits of the Railroad’s right-of-way. The Industry shallpay any fees or costs imposed by any public authority or person for theprivilege of constructing, maintaining and operating the Track.

 

Article 7.                                                GRANT OF RIGHT; USE AND OPERATION OF THETRACK.

 

A.                                   During the term hereof and subject to theterms and conditions set forth in this Agreement, Railroad hereby grants toIndustry the right, at Industry’s sole cost and responsibility, to construct,own, keep, maintain, repair and use Industry’s private section of Trackwhere located on and along Railroad’s right-of-way.

 

B.                                     The Railroad shall operate the Track subjectto any applicable tariffs or rail transportation contracts and the terms ofthis Agreement, but the Railroad shall not be obligated to operate or maintainthe Track (and the Industry shall not have any claim against the Railroad) ifthe Railroad is prevented or hindered from doing so by the Industry’s breach orby acts of God, public authority, strikes, riots, labor disputes, or othercause beyond its control. The Railroad shall have the right to use the Trackwhen not to the detriment of the Industry.

 

C.                                     The Industry shall bear the cost of anymodifications to the Railroad’s tracks, structures and communication facilities,other than track changes connected with the initial switch connection, requiredby the construction, reconstruction or operation of the Track.

 

D.                                    The use and operation of the Track shall alsobe in accordance with the terms and conditions set forth in **Exhibit B**, heretoattached and hereby made a part hereof.

 

Article 8.                                                OWNERSHIP OF THE TRACK.

 

A.                                   The Railroad shall own the portion of Track Afrom the point of switch to the 13-foot, clearance point at Engineering Station1+74, and the portion of Track D from the 13-foot clearance point atEngineering Station 18+88 to the end of Track D (hereinafter “Railroad-ownedTrack”).

 

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B.                                     The Industry shall own the portion of Track Afrom the 13-foot clearance point to the end of the track, all of Track C, theportion of Track D from the point of switch to the 13-foot clearance point atEngineering Station 18+88, and all of Track E, Track F, Track G and futureTrack H (hereinafter “Industry-owned Track”).

 

Article 9.                                                MAINTENANCE OF THE TRACK STRUCTURE (RAIL,TIES, BALLAST. OTHER TRACK MATERIAL).

 

A.                                   The Railroad, at its expense, shall maintainthe track structure for the portion of Railroad-owned Track.

 

B.                                     The Industry, at its expense, shall maintainthe track structure for the portion of Industry-owned Track.

 

Article 10.                                          MAINTENANCE OF RIGHT-OF-WAYAND TRACK APPURTENANCES.

 

A.                                   The Railroad, at its expense, shall maintainthe right-of-way and track appurtenances for the portion of Railroad-ownedTrack.

 

B.                                     The Industry, at its expense, shall performthe following maintenance of the right-of-way and track appurtenances for theportion of Industry-owned Track:

 

1.                                       Remove snow, ice, sand and other substancesand maintain drainage and grading as needed to permit safe operation over theportion of Industry-owned Track.

 

2.                                       Maintain all appurtenances to the portion ofIndustry-owned Track (other than an automatic signal system), including withoutlimitation, gates, fences, bridges, undertrack unloading pits, loading or unloadingdevices and warning signs above, below or beside the track.

 

Article 11.                                          INDUSTRY TO GIVE NOTICE: FLAGGING.

 

Prior to entering Railroad’s right-of-way or otherproperty for the purpose of performing any construction, maintenance, repair orreconstruction of the Track as set forth in this Agreement, and/or constructingadditional track segments connecting to the Track, the Industry and/or itscontractors are required to notify the Railroad’s local Director-TrackMaintenance, in writing, at least ten (10) working days in advance of suchwork, so that the Railroad may, in the event it deems necessary, arrange forflagging or other protection as required. Any such flagging or other protectionfurnished by Railroad will be at Industry’s sole cost and expense.

 

Article 12.                                          CONSTRUCTION, MAINTENANCE AND REPAIRS BYINDUSTRY TO CONFORM TO RAILROAD STANDARDS.

 

A.                                   Track construction, maintenance and repairwork performed by the Industry shall conform to the Railroad’s standards. If,in the judgment of the Railroad, any

 

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portionof the Track is non-conforming and/or unsafe for railroad operations, theRailroad shall not be obligated to operate over the Track.

 

B.                                     The Railroad, at the Industry’s expense,shall have the right, but not be required, to make repairs on theIndustry-owned Track when requested by the Industry or when necessary tooperate the Track safely.

 

Article 13.                                          NON-DISCLOSURES CONFIDENTIALITY.

 

Except to the extent that disclosure of informationcontained in this Agreement is required by law, the contents of this Agreementshall not be disclosed or released by any party without the written consent ofall other parties to this Agreement.

 

Article 14.                                          TERM.

 

This Agreement shall take effect as of the date ofthis Agreement and shall continue in full force and effect until terminated asherein provided.

 

Article 15.                                          CONSENT OF THE RAILROAD TOCERTAIN FACILITIES OR OPERATIONS.

 

The Railroad hereby consentsto:

 

A.                                   the construction, maintenance and operationby the Industry of an ethanol loadout facility at Engineering Station 7+51 ofTrack C as shown on Exhibit A;

 

B.                                     the performance by the Industry of intraplantswitching over the portion of Track A from the derail at Engineering Station2+54 to the end of the track, over all of Track C, over the portion of Track Dfrom the point of switch to the derail at Engineering Station 18+08, and overall of Tracks E, F, G and H, and this consent shall constitute written consentas required in Section 1(e) of **Exhibit B**;

 

subjectto the terms, provisions and conditions set forth in this Agreement and to anyprior regulatory approval that may be needed.

 

Article 16.                                          INSURANCE.

 

A.                                   The Industry, at its expense, shall obtainthe insurance described in**Exhibit C**, hereto attached and hereby made a parthereof, and provide a certificate(s) of insurance certifying to theeffectiveness of such insurance to the address shown in Paragraph C below.

 

B.                                     If the Industry uses the Track to storeand/or handle hazardous materials, the Industry, in addition to the otherendorsements to be obtained by Industry as provided in **Exhibit C**, must alsoensure that the Commercial General Liability insurance policy contains aDesignated Premises Pollution Coverage (CG00-39) endorsement. Evidence of theendorsement must also be indicated on the certificate of insurance provided tothe Railroad.

 

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C.                                     All insurance certificates and correspondenceshall be addressed and sent to:

 

Union Pacific Railroad Company

Real Estate Department

1400 Douglas Street – Stop1690

Omaha, NE 68179-1690

 

IN WITNESS WHEREOF, the parties hereto have causedthis Agreement to be executed in duplicate as of the date first herein written.

 
|              | UNION PACIFIC RAILROAD COMPANY |
|-------------------|--------------------------------|
|              |                           |
|              |                           |
|              | By                             | /s/ Steven J. McLaws |   |
|              |                           | General Director – Industrial Development |
|              |                           |   |
| Witness:          | UNITED WISCONSIN GRAIN         |
|              | PRODUCERS, L.L.C.              |
|              |                           |
| /s/ Suzanne Wendt |                           | By | /s/ Kevin Roche |   |
|              | Printed Name                   | Kevin Roche |   |
|              | Title                          | President |   |
|                   |                                |  |  |  |  |  |  |  |

 

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----

 

 

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| ITC Ind Dev-New Trk 05/01/01 |   | Exhibit B |
|------------------------------|--------|-----------|
| Form Approved, AVP-Law       |   |      |

 

 

Section 1.                                            SAFETY.

 

(a)                                  Clearances/Impairments.  TheIndustry shall not permit or maintain any building, platform, fence, gate,vehicle, or other structure, obstruction or material of any kind, closer to theTrack than the standard clearances of the Railroad without the prior writtenconsent of the Railroad. The standard clearances of the Railroad are (i) horizontally,nine (9) feet from the centerline of the Track, and (ii) vertically,twenty-three (23) feet above the top of the rail of the Track. For any portionof the Track that is curved, the standard horizontal clearance shall beincreased one and one-half inches for each degree of curvature. All doors,windows and gates shall be of the sliding type or open away from the Track ifopening them toward the Track would impair clearances. Any moveable appliance,including, but not limited to, dock plates and loading or unloading spouts orequipment, that impairs the standard clearances only when in use, shall besecurely stored or fastened by the Industry when not in use so as to not impairsuch clearances. If greater clearances are required by the National ElectricalSafety Code or by statute, regulation or other competent public authority, theIndustry shall comply therewith and shall obtain any necessary public authorityand Railroad consent to impair clearances before creating an impairment. Anystructure, material or other obstruction (whether in use or not) which iscloser to the Track than the Railroad’s standard clearances or applicablepublic authority, whichever distance is greater, shall be considered animpairment, whether or not consented to or permitted by the Railroad or publicauthority.

 

(b)                                 Facilities.  The Industry shall notconstruct, locate, maintain or permit the construction or erection of any pits,loadout facilities, buildings, private crossings, beams, pipes, wires, or otherobstructions or installations of any kind or character (hereinafter“Facilities”) over or under the Track without the prior written consent of theRailroad.

 

(c)                                  Walkways.  The Industry, at its expense,shall provide and maintain a clear and safe pathway for Railroad employeesalong both sides of the Track beyond the clearance point. If walkways arerequired by statute or regulation, the Industry, at its expense, shall ensurethat walkways are built and maintained to conform with such statute orregulation.

 

(d)                                 Industry to Train and Oversee Employees.  TheIndustry shall have a non-delegable duty and responsibility to train andoversee its employees and agents as to proper and safe working practices whileperforming any work in connection with this Agreement, or any work associatedwith the Railroad serving the Industry over the Track.

 

(e)                                  Intraplant Switching.  TheIndustry shall not perform, permit or cause intraplant switching without theprior written consent of the Railroad. Intraplant switching means the movementof rail cars on the Track by the Industry by any method and includes theIndustry’s capacity to move rail cars, whether before, during or after any suchmovement, except as allowed by Article 15 of this Agreement.

 

(f)                                    Standards.  The Industry shall comply withall applicable ordinances, regulations, statutes, rules, decisions and ordersincluding, but not limited to, safety, zoning, air and water quality, noise,hazardous substances and hazardous wastes (hereinafter “Standards”) issued byany federal, state or local governmental body or agency (hereinafter“Authority”). lf the Industry is not in full compliance with any Standardsissued by any authorized Authority, the Railroad, after notifying the Industryof its noncompliance and the Industry’s failure within twenty days of suchnotice to correct such noncompliance, may elect to take whatever action isnecessary to bring the Track and any Railroad property into compliance withsuch Standards; PROVIDED, HOWEVER, that if Industry’s failure to comply withStandards interferes with, obstructs or endangers Railroad mainline or yardoperations in any way, Railroad may initiate compliance action immediately. TheIndustry shall reimburse the Railroad for all costs (including, but not limitedto, consulting, engineering, clean-up, disposal, legal costs and attorneys’fees, fines and penalties) incurred by the Railroad in complying with, abatinga violation of, or defending any claim of violation of such Standards. A waiverby the Railroad of the breach by the Industry of any covenant or condition ofthis Agreement shall not impair the right of the Railroad to avail itself ofany remedy for any subsequent breach thereof.

 

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(g)                                 Railcars Containing Hazardous Materials.  Ifthe Industry uses the Track for the purpose of shipping, receiving or storingrailcars containing hazardous materials, as defined by the Department ofTransportation (the “DOT”), the Industry will comply with and abide by all DOTregulations as set out in 49 Code of Federal Regulations, Parts 100-199,inclusive, as amended from time to time, and provisions contained in applicableCircular’s of the Bureau of Explosives, Association of American Railroads,including any and all amendments and supplements thereto. The term “Standards”defined in Section 1(f) shall include (but is not limited to) regulationsreferenced in this subsection (g).

 

(h)                                 Telecommunications and Fiber Optic CableSystems.  Telecommunications and Fiber optic cablesystems may be buried on the Railroad’s property. Industry shall telephone theRailroad during normal business hours (7:00 a.m. to 9:00 p.m., Central Time,Monday through Friday, except holidays) at 1-800-336-9193 (also a 24-hour,7-day number for emergency calls) to determine if telecommunications or fiberoptic cable are buried anywhere on the Railroad’s premises to be used by theIndustry. If it is, Industry will telephone the telecommunication company(ies)involved, arrange for a cable locator, and make arrangements for relocation orother protection of the cable and will commence no work on Railroad’s propertyuntil all such protection or relocation has been accomplished.

 

(i)                                     Fire Precautions. Industry shall not permit, place, pile, store, or stack any flammablematerial within ten (10) feet of centerline of the Track. Industry shall removeor otherwise control vegetation adjacent to the Track so that it does notconstitute a fire hazard. Industry shall ensure that suitable firefightingequipment is available and in working order.

 

Section 2.                                            LIABILITY.

 

(a)                                  For purposes of this Section, the followingdefinitions shall apply:

 

(1)                                  “Railroad”: the Railroad and its officers,agents and employees.

 

(2)                                  “Industry”: the Industry and its officers,agents and employees.

 

(3)                                  “Party”: the Railroad or the Industry.

 

(4)                                  “Third Person”: any individual, corporationor entity other than the Railroad or the Industry.

 

(5)                                  “Loss” means loss of or damage to theproperty of any Third Person or Party and/or injury to or death of any ThirdPerson or Party. “Loss” shall also include, without limitation, the followingassociated expenses incurred by a Party: costs, expenses, the cost of defendinglitigation, attorneys’ fees, expert witness fees, court costs, the amounts paidin settlement, the amount of the judgment, and pre-judgment and post-judgmentinterest and expenses arising from analysis and cleanup of any incidentinvolving the release of hazardous substances or hazardous wastes.

 

(b)                                 Except as otherwise specifically provided inthis Agreement, all Loss related to the construction, operation, maintenance,use, presence or removal of the Track shall be allocated as follows:

 

(1)                                  The Railroad shall indemnify Industry fromand against Loss arising from or growing out of the negligent acts or omissionsof the Railroad.

 

(2)                                  The Industry shall indemnify Railroad fromand against Loss arising from or growing out of the negligent acts or omissionsof the Industry or arising from:

 

(i) any impairment of theTrack by Industry as described in Section 1(a);

 

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(ii)                                  the Industry’s failure to construct oradequately maintain pathways or walkways as required by Section 1(c);

 

(iii)                               intraplant switching as defined by Section 1(e);

 

(iv) the Industry’s failure tocomply with Standards, as required by Section 1(f); or

 

(v) any explosion or leakageor evaporation of hazardous substances or hazardous wastes shipped, received orstored by Industry resulting from Industry’s failure to comply with DOT andother applicable regulations as set forth in Sections 1(f) and 1(g) of ExhibitB.

 

(3)                                  Subsection 2(b)(2), subparagraphs (i)through (v), apply regardless of whether the Railroad had notice of, consentedto, or permitted the aforesaid impairments, failures, noncompliance withStandards, wastes or substances, and whether or not the Railroad or a ThirdPerson contributes to cause the Loss.

 

(4)                                  Except as otherwise more specificallyprovided in this Agreement, Railroad and Industry shall pay equal parts of theLoss that arises out of the joint or concurring negligence of the Railroad andthe Industry, whether or not the acts or omissions of a Third Person contributeto cause the Loss; PROVIDED, however, that nothing in this Agreement to thecontrary shall be construed as impairing the right of either party to seekcontribution or indemnification from a Third Person.

 

(5)                                  Industry expressly and specifically assumespotential worker’s compensation liability under this subsection (b) forclaims or actions brought by Industry’s own employees, subject to all defenses.Industry waives any immunity it may have under worker’s compensation orindustrial insurance acts to indemnify Railroad for claims falling under subsection 2(b)(2).  Industry acknowledges that this waiver wasmutually negotiated by the parties hereto.

 

(6)                                  No court or jury findings in any employee’ssuit pursuant to any worker’s compensation act or the Federal Employer’sLiability Act against a party to this Agreement may be relied upon or used byIndustry in any attempt to assert liability against Railroad.

 

Section 3.                                            REARRANGEMENT OF TRACK; ADDITIONAL TRACKAGE.

 

(a)                                  The Railroad may rearrange or reconstruct theTrack or modify its elevation in order to develop or change nearby Railroadproperty or tracks, provided that the Industry shall continue to have similartrackage without additional cost to the Industry. If, however, the change inthe Track, or its appurtenances, is required by or as a result of any law,ordinance, regulation, or other contingency over which the Railroad has nocontrol, the Industry shall bear the cost of the change.

 

(b)                                 All references in this Agreement to Trackshall apply to the Track as constructed, even if it differs or varies from itsdepiction on Exhibit A. References in this Agreement to Track shall also applyto rearrangements, reconstructions, extensions or additions to the Track.

 

Section 4.                                            PAYMENT OF BILLS; ASSIGNABLE COSTS.

 

(a)                                  Bills for expenses properly chargeable to theIndustry pursuant to this Agreement shall be paid by the industry within thirtydays after presentation by the Railroad except as otherwise provided. Bills notpaid within thirty days shall be subject to interest at the then current ratecharged by the Railroad.

 

 

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(b)                                 “Cost” or “expense” for the purpose of thisAgreement shall be all assignable costs and expenses including all currentRailroad cost additives. Material shall be charged at its current value whenand where used. Assignable costs are any costs incurred by the Railroad thatare directly or indirectly attributable to the construction, maintenance oroperation of the Track that the Railroad has not specifically agreed to payunder the terms of this Agreement.

 

Section 5.                                            GOVERNMENTAL RESTRICTIONS.

 

This Agreement is made subject to all applicablelaws, rules and regulations of the United States Government or any state,municipal, or local governmental authority now or hereafter in effect.

 

Section 6.                                            TERMINATION.

 

(a)                                  Industry may terminate this Agreement uponthirty (30) days’ written notice to Railroad.

 

(b)                                 Railroad may terminate this Agreement bysending thirty (30) days’ written notice to Industry’s last known address:

 

(1)                                  if Industry does not use the Track in anactive and substantial way for a continuous period of six (6) months; PROVIDED,HOWEVER, that Industry has the option after receipt of such notice to pay anannual fee towards the cost of maintaining the switch connection up to theclearance point. The Railroad’s notice of termination for lack of use shallstate the current amount of the annual fee and how frequently it may beadjusted. Industry may accept the option by payment of the annual fee beforethe termination becomes effective on the thirtieth day after notice was mailed.

 

(2)                                  if Industry is in default in the performanceof any covenant or promise in this Agreement and continues in default for aperiod of thirty (30) days after receiving such notice of default from theRailroad; PROVIDED, HOWEVER, that if a default by the Industry is deemed by theRailroad to be unusually dangerous or hazardous, the Railroad may immediatelysuspend its performance under this Agreement during the thirty day default cureperiod. Such termination shall be effective on the thirty-first day after theRailroad sent notice of default if default still exists and no further noticeof termination shall be required.

 

(3)                                  upon thirty (30) days’ written notice ifcontinued operation of Track (including but not limited to the switchconnection itself) becomes impracticable due to abandonment or embargo of raillines, or if the continued presence of the Track would interfere with Railroadoperations (including but not limited to, line changes, construction of newlines, or railroad installation of facilities). In the event Railroadterminates this Agreement pursuant to this subparagraph, Railroad shall attemptto provide Industry a substitute switch connection if such a switch connectionwould be reasonably practicable, could be made safely, and would furnishsufficient business to justify the cost of construction and maintenance.

 

(c)                                  Termination of this Agreement for any reasonshall not affect any of the rights or obligations that the parties hereto mayhave accrued, or liabilities, accrued or otherwise, which may have arisen priorthereto.

 

Section 7.                                            SURRENDER UPON TERMINATION.

 

Upon termination of this Agreement howsoever, theIndustry shall vacate and surrender the quiet and peaceable possession of anyright-of-way or other property owned by the Railroad upon which the Track islocated. The Railroad shall have the right to remove the portion of the Trackit owns. Not later than the last day of the term of this Agreement, theIndustry, at its sole cost and expense, shall (a) remove from the Railroad’sright-of-way or other property all (i) portions of the Track owned by the

 

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Industry,(ii) obstructions, (iii) contamination caused by or arising from the use of theTrack for purposes of the Industry, Facilities (as defined in Section 1(b))and other property not belonging to the Railroad or a third party, locatedthereon and (b) restore the Railroad’s right-of-way to as good a condition asthe same was in before the date of this Agreement. If the Industry fails toperform such removal and restoration, or if the work performed by the Industryis not satisfactory to the Railroad, the Railroad may perform the work atIndustry’s expense. Any portion of the Track owned by Industry and not removedas provided herein may, at Railroad’s election, be deemed abandoned andRailroad, at Industry’s sole cost and expense, may remove such portion(s) ofthe Track from Railroad’s property and dispose of same and restore Railroad’sproperty. If Railroad performs such track removal and/or disposal, the Industryagrees to reimburse the Railroad, within thirty (30) days of its receipt ofbilling from the Railroad, for all costs and expenses incurred by Railroad(less any resulting salvage value) in connection therewith.

 

Section 8.                                            NOTICES.

 

(a)                                  Any notice, consent or approval that eitherparty hereto desires or is required to give to the other party under thisAgreement shall be in writing. The notice, consent or approval shall be deemedto have been given to the Industry by serving the Industry personally or bymailing the same, postage prepaid, to the Industry at the last address known tothe Railroad. Notice may be given to the Railroad by mailing the same, postageprepaid to the office of the Assistant Vice President-Real Estate, Real Estate Department,1416 Dodge Street, Omaha, Nebraska 68179.

 

(b)                                 Notices involving a notice of default ortermination shall be by certified mail, return receipt requested, and suchnotice shall be deemed given on the date deposited with the United StatesPostal Service.

 

Section 9.                                            ASSIGNMENTS USE BY THIRD PARTIES.

 

The Industry shall not assign this Agreement orpermit use of the Track by anyone other than the Industry without the priorwritten consent of the Railroad. The Industry shall notify the Railroad in writingof any assignment to an affiliate prior to the effective date of theassignment. For any departure from the terms of this Section, the Railroad mayterminate this Agreement. The Railroad shall not unreasonably withhold itsconsent to an assignment of this Agreement.

 

Section 10.                                      SUCCESSORS AND ASSIGNS.

 

Subject to the provisions of Section 9, therights and obligations contained in this Agreement shall pass to and be bindingupon the heirs, executors, administrators, successors and assigns of the partiesto this Agreement.

 

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| Track ITC Ex. C 03/01/03 |   | Exhibit C |
|--------------------------|--------|-----------|
| Form Approved, AVP-Law   |   |      |

 

**UNION PACIFIC RAILROAD**

**CONTRACT INSURANCE REQUIREMENTS**

 

**Industrial Track**

 

Industry shall, at its sole cost and expense,procure and maintain during the life of this Agreement the following insurancecoverage:

 

**A.****                                    CommercialGeneral Liability** insurance.This insurance shall contain broad form contractual liability with a singlelimit of at least $3,000,000 each occurrence or claim and an aggregate limit ofat least $3,000,000. Coverage must be purchased on a post 1998 ISO orequivalent form, including, but not limited to, coverage for the following:

 

•                                          Bodily injury including death and personalinjury.

 

•                                          Property damage.

 

•                                          Fire legal liability (not less than thereplacement value of the portion of the premises occupied).

 

•                                          Products and completed operations.

 

Thepolicy shall also contain the following endorsements **which shall be indicated on the certificate of insurance:**

 

•                                          The employee and Workers’Compensation-related exclusions in the above policy apply only to Industry’semployees.

 

•                                          The exclusions for railroads and explosion,collapse and underground hazard shall be removed.

 

•                                          Waiver of subrogation.

 

**B.****                                    BusinessAutomobile Coverage** insurance.This insurance shall contain a combined single limit of at least $5,000,000 peroccurrence or claim, including, but not limited to, coverage for the following:

 

•                                                Bodily injury and property damage.

 

•                                                Any and all motor vehicles including owned,hired and non-owned.

 

Thepolicy shall also contain the following endorsements **which shall be indicated on the certificate of insurance:**

 

•                                          The employee and Workers’Compensation-related exclusions in the above policy apply only to Industry’semployees.

 

•                                          Motor Carrier Act Endorsement - HazardousMaterials Cleanup (MCS-90), if required by law.

 

**C.****                                    Workers’Compensation and Employers Liability** insurance including but not limited to:

 

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•                                          Industry’s statutory liability under theWorkers’ Compensation laws of the state(s) affected by this Agreement.

 

•                                          Employers’ Liability (Part B) with limits ofat least $500,000 each accident, $500,000 disease policy limit, $500,000 eachemployee.

 

IfWorkers’ Compensation insurance will not cover the liability of Industry instates that require participation in state Workers’ Compensation fund, Industryshall comply with the laws of such states. If Industry is self-insured,evidence of state approval must be provided along with evidence of excessWorkers’ Compensation coverage. Coverage shall include liability arising out ofthe U.S. Longshoremen’s and Harbor Workers’ Act, the Jones Act, and the OuterContinental Shelf Land Act, if applicable. The policy shall also containendorsement **which shall be indicatedon the certificate of insurance:**

 

•                                          Alternate Employer Endorsement

 

**D.****                                    Umbrellaor Excess Policies.** In theevent Industry utilizes umbrella or excess policies, these policies shall“follow form” and afford not less coverage than the primary policy.

 

**OtherRequirements**

 

**E.**                                      Punitive damage exclusion must be deleted,which deletion shall be indicated on the certificate of insurance.

 

**F.**                                      Industry agrees to waive its right ofrecovery, and its insurers, through policy endorsement, agree to waive theirright of subrogation against Railroad as *itpertains to the insurance coverage required herein and subject to the terms of Section 2(b)of Exhibit B*. Industry further waives its right of recovery, and itsinsurers also waive their right of subrogation against Railroad for loss of itsowned or leased property or property under its care, custody and control.Industry’s insurance shall be primary with respect to any insurance carried byRailroad. All waivers of subrogation **shall beindicated on the certificate of insurance.**

 

**G.**                                    All policy(ies) required above (excludingWorkers’ Compensation) shall provide severability of interests and shall nameRailroad as an additional insured. **Severability of interestand naming Railroad as additional insured shall be indicated on the certificateof insurance.**

 

**H.**                                    Industry shall furnish to Railroad originalcertificate(s) of insurance evidencing the required coverage, endorsements, andamendments, and reference the contract audit/folder number if available. Thecertificate(s) shall contain a provision that obligates the insurancecompany(ies) issuing such policy(ies) to notify Railroad in writing of anycancellation or material alteration. **Upon requestfrom Railroad, a certified duplicate original of any required policy shall befurnished.**

 

**I.**                                         Any insurance policy shall be written by areputable insurance company acceptable to Railroad or with a current Best’sInsurance Guide Rating of A- and Class VII or better, and authorized to dobusiness in the state in which the Track is located.

 

**J.**                                      Industry **WARRANTS** that this Agreement has been thoroughlyreviewed by Industry’s insurance agent(s)/broker(s), who have been instructedby Industry to procure the insurance coverage required by this Agreement andacknowledges that Industry’s insurance coverage will be primary.

 

**K.**                                    If Industry fails to procure and maintaininsurance as required, Railroad may elect to do so at the cost of Industry plusa 25% administration fee.

 

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**L.**                                     The fact that insurance is obtained byIndustry or Railroad on behalf of Industry shall not be deemed to release ordiminish the liability of Industry, including, without limitation, liabilityunder the indemnity provisions of this Agreement. Damages recoverable byRailroad shall not be limited by the amount of the required insurance coverage.

 

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