Document:

exv10w11

 

Exhibit 10.11

OPTION TO PURCHASE REAL ESTATE

     This option made and entered by and between Timothy L. Cheesman and Diana S. Cheesman, husband
and wife, 128 South 900 West, Farmland, IN 47340, sometimes hereinafter referred to as CHEESMAN;
Lydia B. Harris, Trustee of the Lydia E. Harris Trust under a written trust agreement dated
September 18, 1992, 4838 East Heritage Circle, Muncie, IN; sometimes hereinafter referred to as the
HARRIS TRUST, and Rex V. James, Trustee of the Mary Frances James Revocable Trust Agreement dated
September 18, 2003, 2409 East 39th Street,, Anderson, IN 46013, sometimes
hereinafter referred to as the JAMES TRUST; CHEESMAN, HARRIS MUST and JAMES !RUST sometimes
hereinafter referred to as SELLER, and Cardinal Ethanol, LLC, 2 OMCO Square, P.O. Bo, 501,
Winchester, Indiana 47394, hereinafter referred to as BUYER, WITNESSETH:

     CHEESMAN owns Tract I of the real estate described at Exhibit “A” attached hereto and
incorporated herein by reference.

     HARRIS TRUST owns Tract 2 of the real estate described at Exhibit “A” attached hereto axed
incorporated herein by reference.

     JAMES TRUST owns TRACT 3 of the real estate described at Exhibit “A” attached hereto and
incorporated herein by reference.

     SELLER desires to grant BUYER an option to purchase the real estate described at Exhibit “A”.

     For and in consideration of the sum of One Thousand Five Hundred ($1,500.00) Dollars paid to
the CHEESMAN by BUYER, receipt of said sum being acknowledged by the CHEESMA N with the execution
of this option; the sum of One Thousand Five Hundred ($1,500.00) Dollars paid to the HARRIS TRUST
by BUYER, receipt of said sum being acknowledged by the HARRIS TRUST with the execution of this
option; and

 

 

the sum of One Thousand Five Hundred ($1,500.00) Dollars paid to the JAMES TRUST by BUYER,
receipt of said sum being acknowledged by the JAMES TRUST with the execution of this option; SELLER
gives and grants to BUYER the exclusive option, under the following terms and conditions, to
purchase the real estate described at Exhibit “A”, said real estate to be surveyed, together with
the buildings and all improvements thereon, the real estate described at Exhibit “A” as surveyed,
together with the buildings and improvements thereon, sometimes hereinafter referred to as
PROPERTY.

     1. Term of Option. BUYER shall exercise this option on or before January 30, 2007.
BUYER may extend the time to exercise this option to January 30, 2008, provided on or before
January 30, 2007, BUYER gives to SELLER written notice of BUYER’S desire to extend the time to
exercise this option and pays to SELLER an additional One Thousand Five Hundred (Sl,.500.00)
Dollars at the time of giving said written notice. If BUYER has not exercised this option on or
before January 30, 2007, or on or before the extension date, this option shall terminate, be of no
further force and effect, and SELLER shall be entitled to keep all sums paid under this agreement.

     2. Exercise of Option. This option may be exercised by giving written notice to
SELLER, at SELLER’S address as set forth above, by certified mail, return receipt requested or by
personal service, on or before midnight of January 30, 2007, or on or before midnight of the
extension date.

     3. Purchase Price. The purchase price for the PROPERTY shall be Four Thousand Two
Hundred ($4,200.00) Dollars per surveyed acre less the sum paid for this option. In addition,
CHEESMAN shall receive the sum of Sixty Thousand ($60,000.00) Dollars for the Buildings located on
Tract 1 of the PROPERTY,

     4. Survey. At any time after the execution of this option and during the option
period or after the exercise of this option, BUY ER shall cause an ALTA/ACSM survey

 

 

of the PROPERTY by Beals Surveying Corporation, Richmond, IN. The cost of the survey shall
initially be paid by the BUYER. Provided, that if BUYER objects to any material matter disclosed by
the survey and SELLER is not able to cure the defect as provided herein and BUYER cancels this
agreement because of such material defect, then SELLER shall pay one-half (1/2) of the cost of the
survey to BUYER. Provided, further, that if this transaction closes, SELLER shall pay one-half
(1/2) of the cost of the survey by BUYER being credited with one-half (1/2) of the cost at the
closing. BUYER shall have fourteen (14) days after the delivery of said survey to object to any
material matter disclosed by the Survey. SELLER shall be able to cure any matter objected to by
BUYER on or before fifteen (15) days prior to closing. In the event SELLER is unable to cure any
material matter disclosed by the survey and objected to by BUYER, this agreement shall become null
and void and all sums paid by BUYER to SELLER under this option shall be retained by SELLER.

     5. Deed. Upon payment in full by BUYER to each SELLER of the purchase price for each
SELLER’S tract of ground as herein stated, each SELLER agrees to convey said SELLER’S tract to
BUYER by warranty deed, which warranty deed will convey the PROPERTY to the BUYER free and clear of
any and all liens and encumbrances except easements and restrictions of record acceptable to BUYER,
real estate taxes and assessments, those liens and encumbrances that may possibly attach to the
PROPERTY by reason of the acts of omission or commission of the BUYER, and those liens and
encumbrances as herein set forth and specified.

     6. Property Taxes. Each SELLER. shall pay all installments of property taxes which
become due on said SELLER’S tract prior to the Closing. Property taxes and assessments relating to
each tract for the calendar year of the Closing shall be prorated between the owner of said tract
and BUYER as of the Closing date. If the actual amount

 

 

of taxes for the calendar year of the Closing is not known at the time of the Closing date,
the proration shall be based on the amount of taxes due and payable with respect to each tract for
the calendar year immediately preceding the calendar year of the closing, and BUYER shall be
credited on the closing statement at the Closing SELLER’S pro rata portion of those taxes.

     7. Evidence of Title. At any time after the execution of this option and during the
option period or after the exercise of this option and after the completion of the survey and the
request of BUYER, SELLER shall furnish BUYER a commitment for title insurance issued by a title
company acceptable to BUYER certified to a date within thirty (30) days of delivery to BUYER,
showing merchantable title to the PROPERTY in the name of SELLER. The cost of the commitment shall
initially be paid by BUYER. Provided, that if BUYER objects to any material defect and SELLER is
not able to cure the material defect as provided hereafter and BUYER cancels this transaction
because of such material defect, then SELLER shall pay to BUYER. the cost of said title commitment.
Provided, further, that if this transaction closes, then SELLER shall pay for the title insurance
by BUYER being credited with such cost at the closing, The cost of updates to the title insurance
commitment shall be paid by BUYER (with no credit) unless the updates are required because of
material defects noted in the original commitment, in which case, SELLER shall pay for said
updates. Each SELLER’S cost shall be determined by the Title Company. BUYER shall have fourteen
(14) days after the delivery of said commitment for title insurance to notify SELLER of the
acceptance of title or of any material defects therein. It is agreed by SELLER and BUYER that the
following shall not be considered material defects in title: easements, covenants and restrictions
of record acceptable to BUYER; real estate taxes and assessments; liens and encumbrances as set
forth and mentioned in this agreement; any liens and encumbrances

 

 

that may possibly attach to the PROPERTY by reason of the acts of omission or commission of
the BUYER: and those liens and encumbrances that will be paid at the time of closing. SELLER shall
be able to cure any material defects in title on or before fifteen (15) days prior to closing. In
the event SELLER is unable to cure said material title defects, this agreement shall become null
and void and all sums paid by BUYER to SELLER wider this option shall be retained by SELLER.

     On or before thirty (30) days after the closing of this transaction, SELLER shall deliver to
BUYER a title insurance policy which shall show merchantable title to the PROPERTY in the name of
BUYER and show said real estate to be free and clear of any and all liens and encumbrances except
as set forth above.

     8. Right of Inspection and Investigation. At any time after the execution of this
option and during the option period or after the exercise of this option, BUYER shall have the
right, at BUYER’S expense, to conduct such inspections and investigations of the PROPERTY as BUYER
may desire at BUYER’S absolute discretion. BUYER shall pay to each SELLER any damages caused by
BUYER or BUYER’S agents, independent contractors or employees for damages to each SELLER’S tract
as a result of BUYER’S inspections or investigations. In the event BUYER’S inspections and
investigations reveal that any tract is not satisfactory for BUYER’S purposes, such determination
to be in BUYER’S sole and absolute discretion, this option shall become null and void and all sums
paid by BUYER to SELLER under this agreement shall be retained by SELLER.

     9. Permits to Allow Use of PROPERTY for BUYER’S Intended Purposes. At any time after
the execution of this option, and during the option period, or after the exercise of this option,
BUYER shall, at BUYER’S expense, pursue and obtain from all governmental authorities and
nongovernmental entities, approvals which are necessary to permit the use of the PROPERTY for
BUYER’S intended purposes.

 

 

SELLER shall execute such documents as are necessary and shall assist BUYER to obtain such
approvals. In the event BUYER cannot obtain such approvals, this agreement shall become null and
void and all sums paid by BUYER to SELLER under this option shall be retained by SELLER.

     10. Assignment. This option may not be assigned by BUYER to any individual, limited
partnership, corporation or other entity unless the consent of the SELLER is first obtained in
writing, however such written consent of the SELLER shall not be unreasonably withheld.

     11. Real Estate Agent. The parties agree that BUYER has no responsibility for the
payment of any real estate agent or brokerage fees incurred in the sale of the PROPERTY.

     12. Recording. A memorandum of this option may be recorded in the public records of
Randolph County, State of Indiana.

     13. Time. Time is of the essence of this option.

     14. Attorney’s Fees. After the exercise of this option by BUYER, in the event that
either party shall fail or refuse to complete the transaction as provided for in this option, the
non-prevailing party shall pay the prevailing party all reasonable expenses including, but not
limited to, Attorney’s fees and Court costs, incurred by the prevailing party in any litigation.,
negotiation or transactions relating to, or arising out of, the enforcement of this option by the
prevailing party.

     15. Expenses. SELLER. shall pay for the cost of deed preparation; the cost of an.
Owner’s Policy of Title Insurance (as provided in paragraph 7 herein); the cost of curing title
defects; and one-half (1/2) the cost of survey (as provided in paragraph 4 herein). :BUYER shall
pay the cost of any inspections of the real estate under paragraph 8, the settlement fee and
one-half (1/2) of the cost of the survey (subject to paragraph 4 herein).

 

 

Any other costs of this transaction will be paid by the party incurring the same.

     16. Closing. All transactions contemplated by this closing shall close at the law
office of Robert G. Cook, 116 E. Washington. Street, Winchester, .N 47394, or such other place as
may be agreed upon by the parties, thirty (30) days after the conditions of paragraphs 4, 7, 8, and
9 have been met and said transactions shall close on the same date and said transactions shall
close on the same date as BUYER’S transaction with Dale Bartels and Bonnie Bartels, husband and
wife. Provided, that this transaction shall, in any event, close no later than six (6) months after
the date the option is exercised. Proceeds shall be distributed to each SELLER after all
transactions are closed and after the transaction with Dale Bartels and Bonnie Bartels, husband and
wife, is closed.

     17. SELLER’S Default. After the exercise by BUYER, in the event that SELLER shall
refuse or fail to complete the transaction as provided for in this option, SELLER shall pay
to. BUYER all sums paid to SELLER under this option and this option shall be considered
null and void or, at the option of BUYER, BUYER may pursue such remedies as are available to BUYER
at either law or equity.

     18. BUYER’S Default. After the exercise of this option by BUYER, in the event that
BUYER shall refuse or fail to complete the transaction as provided for in this option, SELLER’S
sole and only remedy shall be to retain all sums paid .under this option as liquidated
damages and this option shall be considered null and void.

     19. Severability. If any provision of this option is held invalid by a Court of
competent jurisdiction, it shall be considered deleted from this option, but such invalidity shall
not affect the other provisions that can be given effect without the invalid provisions.

     20. Entire Agreement. This option constitutes the entire agreement between the
parties. This option shall not be amended except by written agreement signed by both

 

 

parties.

     21. Headings. Headings or titles to said sections or paragraphs of this option are
solely for the convenience of the parties and shall have no effect whatsoever on the interpretation
of the provisions of this agreement.

     22. Law Governing. This option shall be governed by the laws of the State of Indiana.

     23. Authority. The undersigned person executing this agreement for and on behalf of
each SELLER represents and certifies that said person is the duly qualified trustee; said trust is
in writing and in force and effect on the date of the execution of this option; and, the trustee is
authorized by said trust to execute this option.

     24. Authority. The undersigned person executing this agreement for and on behalf of
BUYER represents and certifies that he is the President of BUYER and he has authority to execute
this agreement for and on behalf of BUYER

     25. Binding on Successors and Assigns. Provisions of this agreement will bind the
successors and assigns of the respective parties

     26. Contingency: If the event BUYER does not close with any SELLER, or in the event
that BUYER does not close with Dale Bartels and Bonnie Bartels, husband and wife, pursuant to
BUYER’S agreement with Dale Bartels and Bonnie Bartels, husband and wife, this agreement shall he
considered null and void and all sums paid under this option shall be retained by SELLER.

     27. Compliance with I.C. 32-21-5-1 et al. CHEESMAN shall comply with I.C.
32.-21-5-1 through I.C. 32-21-5-13 regarding the residence located on Tract 1 of the
real estate described at Exhibit “A”.

 

 

     IN WITNESS WHEREOF, CHESSMAN has caused this option to be executed this
10th day of January, 2006; HARRIS TRUST has caused this option to be
executed this 10th day of January, 2006; JAMES TRUST has caused this
option to be executed this 10th day of January, 2006; and BUYER has
caused this option to be executed this day ___ of___, 2006.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Cardinal Ethanol, LLC
	/s/ Timothy L. Cheesman

	 	 	 	By:
	 	/s/ Troy A. Prescott	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	Timothy L. Cheesman

	 	 	 	 	 	Troy A. Prescott	 	 	 	 
	 

	 	 	 	 	 	President	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	/s/ Diana S. Cheesman
 

	 	 	 	 	 	 	 	 	 	 
	Diana S. Cheesman
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	/s/ Lydia E. Haris
 
Lydia
E. Harris, Trustee of the Lydia E. Harris
	 	 	 	 	 	 	 	 	 	 
	Trust under a written trust agreement dated
	 	 	 	 	 	 	 	 	 	 
	September 18, 1992
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	/s/ Rex V. James, Trustee
 
Rex
V. James, Trustee of the Mary Frances James
	 	 	 	 	 	 	 	 	 	 
	Revocable Trust Agreement dated September 18, 2003
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	SELLER

	 	 	 	 	 	BUYER	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 

 

 

State of` Indiana,

County of Randolph, SS:

     Before me, the undersigned Notary Public in and for Randolph County, Indiana, this
10th day of January, 2006, came Timothy L. Cheesman and Diana S.
Cheesman, husband and wife, and acknowledged the execution of the foregoing instrument.

	 	 	 	 	 
	 

	 	Witness my hand and official seal	 	 
	 
	 	 	 	 
	 

	 	/s/ Barbara F. Fisher	 	 
	 

	 	 	 	 
	 

	 	Notary Public	 	 
	 

	 	Printed Name: Barbara F. Fisher	 	 
	 

	 	County of Residence: Randolph
	 	 

My Commission Expires

9/20/09

State of Indiana,

County of Delaware, SS:

     Before me, the undersigned Notary Public in and for Delaware County, Indiana, this
10th day of January, 2006, came Lydia E. Harris, Trustee of the Lydia E.
Harris Trust under a written trust agreement dated September 18, 1992, and acknowledged the
execution of the foregoing instrument.

	 	 	 	 	 
	 

	 	Witness my hand and official seal.	 	 
	 
	 	 	 	 
	 

	 	/s/ Carla M. Hulic	 	 
	 

	 	 	 	 
	 

	 	Notary Public	 	 
	 

	 	Printed Name: Carla M. Hulic	 	 
	 

	 	County of Residence: Randolph
	 	 

My Commission Expires

March 20, 2007

State of` Indiana,

County of Randolph, SS:

 

 

     Before me, the undersigned Notary Public in and for Randolph County, Indiana, this
10th day of January, 2006, came Rex V. James, Trustee of the Mary
Frances James Revocable Trust Agreement dated September 18, 2003, and acknowledged the execution of
the foregoing instrument.

	 	 	 	 	 
	 

	 	Witness my hand and official seal	 	 
	 
	 

	 	/s/ Barbara F. Fisher	 	 
	 

	 	 	 	 
	 

	 	Notary Public	 	 
	 

	 	Printed Name: Barbara F. Fisher	 	 
	 

	 	County of Residence: Randolph
	 	 

My Commission Expires

9/20/09

State of Indiana,

County of Randolph, SS:

     Personally appeared before me, the undersigned Notary Public in and for Randolph
County, State of Indiana, this 10th day of January, 2006, Troy A.
Prescott, personally known to m e to be President of Cardinal Ethanol, LLC, and after first being
duly sworn upon his oath, acknowledged the execution of the above and foregoing instrument for and
on behalf of Cardinal Ethanol, LLC, and stated that the representations contained therein are true.

	 	 	 	 	 
	 
	 	 	 	 
	 

	 	/s/ Kerissa J. McComb	 	 
	 

	 	 	 	 
	 

	 	Notary Public	 	 
	 

	 	Printed Name: Kerissa J. McComb	 	 
	 

	 	County of Residence: Randolph	 	 
	 

	 	 	 	 

My
Commission expires

9/28/12

This instrument prepared by Robert G. Cook, Attorney, Winchester, IN

 

 

The following described real estate situate in Randolph County, Indiana, to-wit:

TRACT
1:

Sixty (60) acres of even width off the entire south end of the west half of tile southwest quarter
of Section thirteen (13), Township twenty (20) north, Range twelve (12) east.

TRACT
II

The north half of the northwest quarter of the southwest quarter of Section 13, Township 20 north,
Range 12 East, containing 20 acres, more or less; ALSO, that part of the south half of the
northwest quarter of said Section 13, Township 20 north, Range 12 east, which lies south of the
C.C.C. & St. Louis Railway containing 59.58 acres, more or less. EXCEPT, beginning at an iron rod
at the west quarter corner of Section 13, (assuming that the west line of the northwest quarter
runs north and. south), and running thence north, along the said west line, 137.66 feet to an iron
rod; thence south 87 degrees 58 minutes east, 623.10 feet to an iron pipe; thence south 1 degree 00
minutes west, 123.50 feet to an iron pipe; thence north 89 degrees 34 minutes west, 311.68 feet to
an iron pipe; thence south 71 degrees 24 minutes west 123.95 feet to an iron pipe, thence north 89
degrees 34 minutes west, 191,28 feet to an iron rod in the west line of the said southwest quarter;
thence north 00 degrees 23 minutes west, along said west line, 43.57 feet to the place of
beginning, containing an area of 2,118 acres, there being 1.875 acres in the northwest quarter and .243 acres in the southwest quarter. Containing after said exception 77.462 acres, more or less.

TRACT III:

All that part of the following described real estate lying north of the center line of the Angling
Road:

The East half of the Southwest Quarter of Section thirteen (13), Township twenty (20) North, Range
twelve (12) East, containing eight (80) acres, more or less.

EXCEPTING
THEREFROM the following described real estate:

A part of the southeast quarter of the southwest quarter of Section thirteen (13), township twenty
(20) north, Range twelve (12) east more particularly described as follows, to-wit: Beginning at a
point in the center of the Angling Road, said point being located as follows: Commencing at the
southeast corner of said southeast quarter of the southwest quarter and proceeding thence North
ninety (90) degrees West, one thousand two hundred seventy and eighty-five hundredths (1,270,85)
feet; thence proceeding north forty-four degrees twenty-six minutes forty seconds east (N 44° 26’
44” E) nine hundred fifty-four and two hundredths (954.02) feet to the place of beginning of the
tract hereafter described; thence continuing north forty-four degrees twenty-six minutes
forty seconds east (N 44°26’ 40” E) along the center of said Angling Road, four hundred
seventeen and sixteen hundredths (417.16) feet; thence proceeding south zero degrees zero minutes
west (S 00° 00’ W), two hundred ninety eight and four hundredths (298.04) feet.; thence proceeding
south ninety degrees zero minutes west (S 90°00’ W), two hundred ninety-two and thirty-two
hundredths(292.32) feet to the place of beginning, containing 1.000 aces, more or less.

EXHIBIT “A”

 

 

	 	 	 	 	 
	Prescribed by the
	 	 	 	 
	State Board of Accounts

	 	 	 	County Form 170
	(2005)
	 	 	 	 
	 
	 	 	 	 
	 

	 	Declaration	 	 

This form is to be signed by the preparer of a document and recorded with each document in
accordance with IC 36-2-7.5-5(a).

I, the undersigned preparer of the attached document, In accordance with IC 36-2-7.5, do hereby
affirm under the penalties of perjury:

	 	1.	 	I have reviewed the attached document for the purpose of identifying and, to
the extent permitted by law, redacting all Social Security numbers;
	 
	 	2.	 	I have redacted, to the extent permitted by law, each Social Security number
in the attached document.

I, the undersigned, affirm under the penalties of perjury, that the foregoing declarations are
true.

	 	 	 	 	 
	 

	 	/s/ Robert G. Cook	 	 
	 

	 	 	 	 
	 

	 	Signature of Declarant	 	 
	 
	 	 	 	 
	 

	 	Robert G. Cook	 	 
	 

	 	 	 	 
	 

	 	Printed Name of Declarantexv10w12

 

Exhibit 10.12

OPTION TO PURCHASE REAL ESTATE

     This option made and entered by and between Dale Bartels and Bonnie Bartels, husband. and
wife, 1509 North 900 West, Farmland, IN 47340, hereinafter referred to as SELLER, and Cardinal
Ethanol, LLC, 2 OMCO Square, P.O. Box 501, Winchester, Indiana 47394, hereinafter referred to as
BUYER, WITNESSETH:

     SELLER is the owner of the real estate described at Exhibit “A”.

     SELLER desires to grant BUYER an option to purchase the real estate described at Exhibit “A”.

     For and in consideration of the sum of One Thousand Five Hundred (51,500.00) Dollars paid to
SELLER by BUYER, SELLER gives and grants to BUYER the exclusive option, under the following terms
and conditions, to purchase the real estate described at Exhibit “A”, said real estate to be
surveyed, together with the buildings and. all improvements thereon, the real estate described at
Exhibit “A” as surveyed, together with the buildings and improvements thereon, sometimes
hereinafter referred to as PROPERTY.

     1. Term of Option. BUYER shall exercise this option on or before January 30, 2007.
BUYER may extend the time to exercise this option to January 30, 2008, provided on or before
January 30, 2007, BUYER gives to SELLER written notice of BUYER’S desire to extend the time to
exercise this option and pays to SELLER an additional One Thousand Five Hundred (Sl,.500.00)
Dollars at the time of giving said written notice. If BUYER has not exercised this option on or
before January 30, 2007, or on or before the extension date, this option shall terminate, be of no
further force and effect, and SELLER shall be entitled to keep all sums paid under this agreement.

 

 

     2. Exercise of Option. This option may be exercised by giving written notice to
SELLER, at SELLER’S address as set forth above, by certified mail, return receipt requested or by
personal service, on or before midnight of January 30, 2007, or on or before midnight of the
extension date.

     3. Purchase Price. The purchase price for the PROPERTY shall be the sum of Forty
Thousand ($40,000.00) Dollars and the residence and buildings and five (5) acres upon which is
situate and which surrounds said residence and buildings located on the following described real
estate in Randolph County, State of Indiana, to-wit: Sixty (60) acres of even width off of the entire south end of the west half of the southwest
quarter of Section thirteen (13), Township twenty (20) North, Range twelve (12) east.
BUYER’S transfer of the FIVE ACRE TRACT will be subject to the terms and conditions contained in
“Exhibit B”.

     4. Survey. At any time after the execution of this option and during the option
period or after the exercise of this option, BUY ER shall cause an ALTA/ACSM survey of the PROPERTY
by Beals Surveying Corporation, Richmond, IN. The cost of the survey shall initially be paid by the
BUYER. Provided, that if BUYER objects to any material matter disclosed by the survey and SELLER is
not able to cure the defect as provided herein and BUYER cancels this agreement because of such
material defect, then SELLER shall pay one-half (1/2) of the cost of the survey to BUYER. Provided,
further, that if this transaction closes, SELLER shall pay one-half (1/2) of the cost of the survey
by BUYER being credited with one-half (1/2) of the cost at the closing. BUYER shall have fourteen
(14) days after the delivery of said survey to object to any material matter disclosed by the
Survey. SELLER shall be able to cure any matter objected to by

 

 

BUYER on or before fifteen (15) days prior to closing. In the event SELLER is unable to cure any
material matter disclosed by the survey and objected to by BUYER, this agreement shall become null
and void and all sums paid by BUYER to SELLER under this option shall be retained by SELLER.

     5. Deed. Upon payment in. full by BUYER to SELLER. of the purchase price for SELLER
agrees to convey the PROPERTY to BUYER by warranty deed, which warranty deed will convey the
PROPERTY to the BUYER free and clear of any and all liens and encumbrances except easements and
restrictions of record acceptable to BUYER, real estate taxes and assessments, those liens and.
encumbrances that may possibly attach to the PROPERTY by reason of the acts of omission or
commission of the BUYER, and those liens and encumbrances as herein set forth and specified.

     6. Property Taxes. SELLER shall pay all installments of property taxes which become
due prior to the Closing. Property taxes and assessments relating to the PROPERTY for the calendar
year of the Closing shall be prorated between SELLER and BUYER as of the Closing date. If the
actual amount of taxes for the calendar year of the Closing is not known at the time of the Closing
date, the proration shall be based on the amount of taxes due and payable with respect; to the
PROPERTY for the calendar year immediately preceding the calendar year of the closing, and BUYER
shall be credited on the closing statement at the Closing SELLER’S pro rata portion of those taxes.

     7. Evidence of Title. At any time after the execution of this option and during the
option period or after the exercise of this option and after the completion of the survey and the
request of BUYER, SELLER shall furnish BUYER a commitment for title

 

 

insurance issued by a title company acceptable to BUYER certified to a date within thirty (30)
days of delivery to BUYER, showing merchantable title to the PROPERTY in the name of SELLER. The
cost of the commitment shall initially be paid by BUYER. Provided, that if BUYER objects to any
material defect and SELLER is not able to cure the material defect as provided hereafter and BUYER
cancels this transaction because of such material defect, then SELLER shall pay to BUYER. the cost
of said title commitment. Provided, further, that if this transaction closes, then SELLER shall
pay for the title insurance by BUYER being credited with such cost at the closing, The cost of
updates to the title insurance commitment shall be paid by BUYER (with no credit) unless the
updates are required because of material defects noted in the original commitment, in which case,
SELLER shall pay for said updates. BUYER shall have fourteen (14) days after the delivery of said
commitment for title insurance to notify SELLER of the acceptance of title or of any material
defects therein. It is agreed by SELLER and BUYER that the following shall not be considered
material defects in title: easements, covenants and restrictions of record acceptable to BUYER;
real estate taxes and assessments; liens and encumbrances as set forth and mentioned in this
agreement; any liens and encumbrances that may possibly attach to the PROPERTY by reason of the
acts of omission or commission of the BUYER: and those liens and encumbrances that will be paid at
the time of closing. SELLER shall be able to cure any material defects in title on or before
fifteen (15) days prior to closing. In the event SELLER is unable to cure said material title
defects, this agreement shall become null and void and all sums paid by BUYER to SELLER wider this
option shall be retained by SELLER.

 

 

     On or before thirty (30) days after the closing of this transaction, SELLER shall deliver to
BUYER a title insurance policy which shall show merchantable title to the PROPERTY in the name of
BUYER and show said real estate to be free and clear of any and all liens and encumbrances except
as set forth above.

     8. Right of Inspection and Investigation. At any time after the execution of this
option and during the option period or after the exercise of this option, BUYER shall have the
right, at BUYER’S expense, to conduct such inspections and investigations of the PROPERTY as BUYER
may desire at BUYER’S absolute discretion. BUYER shall pay to SELLER any damages caused by BUYER or
BUYER’S agents, independent contractors or employees for damages to the PROPERTY as a result of
BUYER’S inspections or investigations. In the event BUYER’S inspections and investigations reveal
that the PROPERTY is not satisfactory for BUYER’S purposes, such determination to be in BUYER’S
sole and absolute discretion, this option shall become null and void and all sums paid by BUYER, to
SELLER under this agreement shall be retained by SELLER.

     9. Permits to Allow Use of PROPERTY for BUYER’S Intended Purpose. At any time after
the execution of this option, and during the option period, or after the exercise of this option,
BUYER shall, at BUYER’S expense, pursue and obtain from all governmental authorities and
nongovernmental entities, approvals which are necessary to permit the use of the PROPERTY for
BUYER’S intended purposes. SELLER shall execute such documents as are necessary and shall assist
BUYER to obtain such approvals. In the event BUYER cannot obtain such approvals, this agreement
shall become null and void and all sums paid by BUYER to SELLER under this option

 

 

shall be retained by SELLER.

     10. Assignment. This option may not be assigned by BUYER to any individual, limited
partnership, corporation or other entity unless the consent of the SELLER is first obtained in
writing, however such written consent of the SELLER shall not be unreasonably withheld.

     11. Real Estate Agent. The parties agree that BUYER has no responsibility for the
payment of any real estate agent or brokerage fees incurred in the sale of the PROPERTY.

     12. Recording. A memorandum of this option may recorded in the public records of
Randolph County, State of Indiana.

     13. Time. Time is of the essence of this option.

     14. Attorney’s Fees. After the exercise of this option by BUYER, in the event that
either party shall fail or refuse to complete the transaction as provided for in this option, the
non-prevailing party shall pay the prevailing party all reasonable expenses including, but not
limited to, Attorneys fees and Court costs, incurred by the prevailing party in any litigation,
negotiation or transactions relating to, or arising out of, the enforcement of this option by the
prevailing party.

     15. Expenses. SELLER shall pay for the cost of deed preparation; the cost of an
Owner’s Policy of Title Insurance (as provided in paragraph 7 herein); the cost of curing title
defects; and one-half (1/2) the cost of survey (as provided in paragraph 4 herein). BUYER shall pay
the cost of any inspections of the real estate under paragraph 8, the settlement fee and one-half
(1/2) of the cost of the survey (subject to paragraph 4 herein). Any other costs of this
transaction will paid by the party incurring the same.

 

 

     16. Closing. This transaction shall close at the law office of Robert G. Cook, 116
E. Washington Street, Winchester, IN 47394, or such other place as may be agreed upon by the
parties, thirty (30) days after the conditions of paragraphs 4, 7, 8, and 9 have been met and on
the same date as SELLER’S closing with Timothy L. Cheesman and Diana S. Cheesman, husband and wife;
Lydia E. Harris, Trustee of the Lydia E. Harris Trust; and Rex V. James, Trustee of the Mary
Frances James Revocable Trust Agreement. Provided, that this transaction shall, in any event, close
no later than six (6) months after the date the option is exercised. Proceeds shall be distributed
to SELLER after SELLER’S transactions are closed and after BUYER’S transactions are closed with the
Robert M. Cheesman and Lena M. Cheesman Revocable Living Trust; Lydia E. Harris, Trustee of the
Lydia E. Harris Trust; and Rex V. James, Trustee of the Mary Frances James Revocable Trust
Agreement.

     17. SELLER’S Default. After the exercise of this option by BUYER, in the event that
SELLER. shall refuse or fail to complete the transaction as provided for in this option, SELLER
shall pay to BUYER all sums paid to SELLER under this option and this option shall be considered
null and void or, at the option of BUYER, BUYER may pursue such remedies as are available to BUYER
at either law or equity.

     18. BUYER’S Default. After the exercise of this option by BUYER, in the event that
BUYER shall refuse or fail to complete the transaction as provided for in this option, SELLER’S
sole and only remedy shall be to retain all sums paid under this option as liquidated damages and
this option shall be considered null and void.

     19. Severability. If any provision of this option is held invalid by a Court of
competent jurisdiction, it shall be considered deleted from this option, but such

 

 

invalidity shall not affect the other provisions that can be given effect without the invalid
provisions.

     20. Entire Agreement. This option constitutes the entire agreement between the
parties. This option shall not he amended except by written agreement signed by both parties.

     21. Headings. Headings or titles to said sections or paragraphs of this option are
solely for the convenience of the parties and shall have no effect whatsoever on the interpretation
of the provisions of this agreement.

     22. Law Governing. This option shall be governed by the laws of the State of
Indiana.

     23. Authority. The undersigned person executing this agreement for and on behalf of
BUYER represents and certifies that he is the President of BUYER and he has authority to execute
this agreement for and on behalf of BUYER.

     24. Binding on Successors and Assigns. Provisions of this agreement will bind the
successors and assigns of the respective parties.

     25. Contingency: If the event BUYER does not close with the Robert M. Cheesman and
Lena M. Cheesman Revocable Living Trust, Lydia E. Harris, Trustee of the Lydia E. Harris Trust
under a written trust agreement dated September 18, 1992, and Rex V. James, Trustee of the Mary
Frances James Revocable Trust Agreement dated September 18, 2003, this agreement shall be
considered null and void and all sums paid under this option shall be retained by SELLER.

 

 

     IN WITNESS WHEREOF, SELLER has executed this agreement this 11th day of
Jan, 2006, and BUYER has caused this agreement to be executed this 11th
day of January, 2006.

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Cardinal Ethanol, LLC	 	 	 	 
	/s/ Dale L. Bartels	 	 	 	By:	 	/s/ Troy Prescott	 	 
	 	 	 	 	 	 	 	 	 
	Dale Bartels	 	 	 	 	 	Troy a. Prescott	 	 
	 	 	 	 	 	 	 	 	President	 	 
	/s/ Bonnie Bartels	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	Bonnie Bartels	 	 	 	 	 	 	 	 	 	 
	
 

	 

	 	SELLER
	 	 	 	 	 	 	 	BUYER	 	 

 

 

State of Indiana,

County of Randolph, SS:

     Before me, the undersigned Notary Public in and for Randolph County, Indiana, this
11th day of January, 2006, came Dale Bartels and Bonnie Bartels, husband
and wife, and acknowledged the execution of the foregoing instrument.

	 	 	 	 	 
	 	Witness my hand and official seal.

 	 
	 	/s/ Barbara F. Fisher
 	 
	 	Notary Public 	 
	 	Printed Name: Barbara F. Fisher

County of Residence: Randolph 	 
	 

My Commission Expires:

9/20/09

State of Indiana,

County of Randolph, SS:

     Personally appeared before me, the undersigned Notary Public in and for Randolph
County, State of Indiana, this 10th day of January, 2006, Troy A.
Prescott, personally known to m e to be President of Cardinal Ethanol, LLC, and after first being
duly sworn upon his oath, acknowledged the execution of the above and foregoing instrument for and
on behalf of Cardinal Ethanol, LLC, and stated that the representations contained therein are true.

	 	 	 	 	 
	 	 	 
	 	                                    /s/ Kerissa J. McComb
 	 
	 	Notary Public 	 
	 	Printed Name: Kerissa J. McComb

County of Residence: Randolph 	 
	 

My Commission expires

9/28/12

This instrument prepared by Robert G. Cook, Attorney, Winchester, IN

 

 

The following described real estate situate in Randolph County, Indiana, to-wit:

Being a part of the Northwest Quarter and Southwest Quarter both being Section 13, Township 20
North, Range 12 East in Monroe Township, Randolph County, Indiana, and being more particularly
described as follows:

Beginning at an iron rod at the West Quarter corner of Section 13, (assuming that the west line of
the Northwest Quarter runs north and south), and running thence north, along the said west line,
137.66 feet to an iron rod; thence south 87 degrees and 58 minutes east, 623.10 feet to an iron
pipe; thence south 1 degrees and 00 west, 123.50 feet to an iron pipe; thence north 89 degrees and
34 minutes west, 311.68 feet to an iron pipe; thence south 71 degrees and 24 minutes west, 123.95
feet to an iron pipe; thence north 89 degrees and 34 minutes west, 191.28 feet to an iron rod in
the west line of the said. Southwest Quarter; thence north 0 &gees and 23 minutes west, along said
west line, 43,57 feet to the place of beginning, containing an area of 2.118 acres, there being
1,875 acres in the Northwest Quarter and 0.243 acres in the Southwest Quarter. 2,

SUBJECT TO: The right-of-way of County Road 900 West, and any easements of record

EXHIBIT “A”

 

 

Conditions of Transfer of FIVE ACRE TRACT

     Buyer shall convey the FIVE ACRE TRACT under the following terms and conditions:

          I, The FIVE ACRE TRACT shall include all appurtenant rights., privileges and easements, and
all buildings and fixtures in their present condition. BUYER shall cause a survey of the PROPERTY
by Beals Surveying Corporation, Richmond, IN. The cost of the survey shall be paid by the BUYER

          2. Compliance with LC. 32-21-5-1 et al, BUYER shall comply with I.C. 32-21-5-1 through
I.C. 32-21-5-13.

          3. Lead Paint Inspection: SELLER hereby waives the opportunity to conduct a risk
assessment or inspection for the presence of lead-based paint and/or lead-based paint hazards.

          4. Disclosure Document. BUYER shall deliver to SELLER a “disclosure document” in form
and substance as proscribed by the Indiana Responsible Property Transfer Law, as amended, if the
FIVE ACRE TRACT is “property” within the meaning of the Indiana Responsible Property Transfer Law,
or if the FIVE ACRE TRACT is not “property” within the meaning of the Indiana Responsible Property
Transfer Law, then a certificate in form and substance satisfactory to SELLER that the FIVE ACRE
TRACT is not subject to the provisions of the Indiana Responsible Property Transfer Law,

          5. Method of Conveyance. BUYER will execute and deliver to SELLER a warranty deed for
the FIVE ACRE TRACT conveying the same to SELLER free and clear of all liens and encumbrances
except easements and restrictions of record; except oil and gas leases of record; except the liens
and encumbrances as set forth in this exhibit “B”; and except any liens and encumbrances that may
possibly attach to the above described FIVE ACRE TRACT by reason of the acts of omission or
commission of the SELLER.

          6. Evidence of Title: BUYER shall provide to SELLER, at BUYER’S expense, a commitment
for title insurance, certified to a date within fifteen (15) days of delivery to SELLER, showing
merchantable title to the FIVE ACRE TRACT in the names of Timothy L Cheesman and Diana S. Cheesman,
husband and wife, and showing the FIVE ACRE TRACT to be free and clear of any and all liens and
encumbrances, except for easements, restrictions and conditions of record; except for oil and gas
leases of record; except as hewn’ set forth and mentioned in this agreement; except any liens and
encumbrances that may possibly attach to the FIVE ACRE TRACT by reason of the acts of omission or
commission of the SELLER; and except any liens and encumbrances which will be paid at the closing
of the transaction between BUYER and Timothy L. (linesman and Diana S. Cheesman, husband and wife.
SELLER shall have seven (7) days after the delivery of said commitment for title insurance to
notify BUYER of the acceptance of title or of any defects therein. BUYER shall cure any defects in
title within seven (7) days after SELLER’S written notice of the same.

          On or before thirty (30) days after the closing of this transaction, BUYER shall deliver to
SELLER. a title insurance policy which shall show merchantable title to the FIVE ACRE TRACT in the
name of SELLER and show said FIVE ACRE TRACT to be free and clear of any and all liens and
encumbrances except as herein set forth and mentioned in this agreement.

 

 

EXHIBIT “B”

Page 1 of 2 pages

          7. Real estate Taxes. BUYER. shall pay all installments of property taxes which become
due prior to the Closing. Property taxes and assessments relating to the PROPERTY for the calendar
year of the Closing shall be prorated between SELLER and BUYER as of the Closing date. If the
actual amount of taxes for the calendar year of the Closing is not known at the time of the Closing
date, the proration shall be based on the amount of taxes due and payable with respect to the
PROPERTY for the calendar year immediately preceding the calendar year of the closing, and SELLER
shall be credited on the closing statement at the Closing BUYER’S pro rata portion of those taxes.,

          8. Condition of Property at Closing. Pending the close of this transaction, if the
improvements on the FIVE ACRE TRACT are damaged or destroyed by fire or other casualty, SELLER or
BUYER may elect to void this contract. SELLER takes the improvements on the FIVE ACRE TRACT as is.
SELLER makes no warranties concerning said improvements, including any warranty of Habitability.

          9. Right of First Refusal. As part consideration for the Option, BUYER and SELLER
agree to execute the Right of First Refusal, attached hereto as Exhibit “1”, immediately upon the
conveyance of the FIVE ACRE TRACT from BUYER to SELLER.

 

 

AGREEMENT FOR RIGHT OF FIRST REFUSAL

     This agreement made and entered by and between Dale Bartels and Bonnie Bartels, husband and
hereinafter referred to as FIRST PARTY, and. Cardinal Ethanol, L.LC, an Indiana Corporation,
hereinafter referred to as SECOND PARTY, WITNESSETH:

     WHEREAS, FIRST PARTY is the owner of and possesses the legal title to the following described
real estate situated in Randolph County, State of Indiana, to-wit The following described real
estate situate in Randolph County, State of Indiana, to-wit:

     SURVEY DESCRIPTION OF FIVE ACRE TRACT TO BE INSERTED The above described real estate
hereinafter referred to as REAL ESTATE.

     WHEREAS, FIRST PARTY purchased from SECOND PARTY the REAL ESTATE.

     WHEREAS, as part consideration for the entering of a certain option to purchase real estate
entered by and between the Parties, the Parties agreed to enter this Right of First Refusal
Agreement for the REAL ESTATE.

     Now therefore, in part consideration of the entering of a certain option to purchase real
estate entered by and between the parties, and for the mutual promises contained herein, the
Parties agree as follows:

EXHIBIT “1”

Page 1 of 5 pages

 

 

     1. Grant of Right: In the event that FIRST PARTY desires to enter an agreement for the
sale and purchase of the REAL ESTATE, FIRST PARTY, and on behalf of FIRST PARTY’S successors and
assigns, grants to SECOND PARTY the right of first refusal to purchase the REAL ESTATE at the same
price and upon the same terms and conditions contained in such written Agreement, except as
modified herein.

     2. Certificate of Offer: FIRST PARTY shall certify a complete, true, and correct copy
of such Agreement to SECOND PARTY. SECOND PARTY shall I-lave a period of thirty (30) days from the
date of receipt of such written Agreement to elect whether or not SECOND PARTY intends to accept or
reject such Agreement.

     3. Acceptance of Offer: If SECOND PARTY desires to purchase the REAL ESTATE from FIRST
PARTY upon the terms and conditions as set forth in such Agreement except as modified herein,
SECOND PARTY shall so notify FIRST PARTY within thirty (30) days of the receipt of such written
Agreement by FIRST PARTY and shall accompany such notice with. an earnest money deposit equivalent
to any earnest money deposit that was made in the original Agreement. If SECOND PARTY fails to so
notify FIRST PARTY of SECOND PARTY’s acceptance of such Agreement and exercise of the right of
first refusal within said thirty (30) day period, such failure to notify FIRST PARTY shall be
deemed a rejection of such Agreement.

     4. Consummation of Purchase: In the event of the exercise by SECOND PARTY of this
Right of First Refusal, FIRST PARTY and SECOND PARTY shall consummate the sale for purchase of the
REAL ESTATE within thirty

Page 2 of 5 pages

 

 

(30) days after SECOND PARTY has notified FIRST PARTY, upon the terms and conditions of such
Agreement as originally submitted to FIRST PARTY and as certified to SECOND PARTY, except such
terms and conditions as may be modified by this Agreement. In the event that such Agreement should
include as part of the consideration to be paid for the REAL ESTATE any particular or unique
property, or the exchange of any other property, SECOND PARTY shall not be required to deliver to
FIRST PARTY such property. but shall satisfy such obligations by the payment to FIRST PARTY of the
cash equivalent of the value of such other property to FIRST PARTY, and an additional amount that
will place FIRST PARTY in the same position, after payment of all taxes thereon, that FIRST PARTY
would have been in had such exchange been made.

     5. Non-exercise: In the event that SECOND PARTY fails to exercise its right of first
refusal, then FIRST PARTY shall be free to sell said REAL ESTATE on the exact same terms and
conditions as certified to SECOND PARTY if the sale is closed within ninety (90) days after
acceptance y FIRST PARTY. Any amended Agreement, or subsequent Agreement, shall be once again
submitted to the SECOND PARTY for acceptance or rejection as provided above.

     6. Binding Effect: The terms and conditions of this right of first refusal shall be
binding upon the heirs, personal representative, successors, and assigns of the parties for a
period of twenty (20) years from date of execution.

     7. Authority. The undersigned person executing this agreement for and on behalf of
SECOND PARTY represents and certifies that he is a duly elected officer of

Page 3 of 5 pages

 

 

SECOND PARTY; that he has been duly authorized by proper resolution of the board of directors of
SECOND PARTY to execute this Agreement for Right of First Refusal for and on behalf of SECOND
PARTY; that SECOND PARTY is a limited liability company in good standing in the State of Indiana;
and that all necessary action for the making of this Agreement has been taken and done.

	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Cardinal Ethanol, LLC	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	Dale Bartels	 	Troy Prescott	 	 	 	 
	 	 	 	 	President	 	 	 	 
	Bonnie Bartels	 	 	 	 	 	 	 	 	 	 
	          FIRST
PARTY	 

	 	 	 	 	 	 	SECOND PARTY	 	 

State of Indiana,

                            
 County, SS:

     Before me, the undersigned Notary Public in and for said County and State, this 
            day of 
           , 2006, came Dale Bartels and Bonnie Bartels, and acknowledged the execution of
the foregoing instrument.

     Witness my hand and official seal.

	 	 	 	 	 
	 

	 	Notary Public

	 	 
	 

	 	Printed Name:
                	 	 
	 

	 	County of Residence:                  	 	 

My
Commission Expires:

                            

Page 4 of 5 pages

 

 

State of Indiana,

Randolph County, SS:

     Personally appeared before me, the undersigned Notary Public in and for said County and State,
this                 day of                , 2006, Troy Prescott, personally known to me to be President of Cardinal Ethanol, LLC,
an Indiana Limited Liability Company, and after first being duly sworn upon his oath, acknowledged
the execution of the above and foregoing instrument for and on behalf of Cardinal Ethanol, LLC, and
stated that the representations contained therein are true.

	 	 	 
	 

	 	Notary Public
	 

	 	Printed
Name:                                      
	 

	 	County of Residence:                          

My Commission Expires:

                    

This instrument prepared by Robert G. Cook, Attorney-at-Law, Winchester, IN.

Prescribed by the

			
	State Board of Accounts

(2005)
	 	County Form 170          

Declaration

This form is to be signed by the preparer of a document and recorded with each document in
accordance with IC 36-2-7.5-5(a).

I, the undersigned preparer of the attached document, In accordance with IC 36-2-7.5, do hereby
affirm under the penalties of perjury:

	 	1.	 	I have reviewed the attached document for the purpose of identifying and, to
the extent permitted by law, redacting all Social Security numbers;
	 
	 	2.	 	I have redacted, to the extent permitted by law, each Social Security number
in the attached document.

I, the undersigned, affirm under the penalties of perjury, that the foregoing declarations are
true.

	 	 	 	 	 
	 	 	 
	 	                                               /s/ Robert G. Cook
 	 
	 	Signature of Declarant 	 
	 	 	 
	 
	 	Robert G. Cook

 	 
	 	Printed Name of Declarant 	 
	 	 	 
	 	 	 
	 

Page 5 of 5 pages

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