20110922Notice of Affiliate Transaction.pdf

-"ROCKY MOUNTAIN REC ¡VED
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September 22, 2011
Mark C. Moench
Senior Vice President and General
Counsel
201 S. Main Street, Suite 2400
Salt Lake Cit, UT 84111
801-220-459 Ofce
801-220-058 Fox
lnrk.moench(gacificorp.com
VI OVERNIGHT DELIVERY
Idaho Public Utilities Commission
472 West Washington
Boise,ID 83702-5983
Attention: Jean D. Jewell
Commssion Secreta
Re: PacifiCorp Notice of Affliate Trasaction
Case No. P AC-E-05-8
Dear Ms. Jewell:
Ths letter will serve as notice puruat to Commitment I 17(2), incorprated in the
Idaho Public Utilties Commssion Order No. 29973 issued Febru 13,2006, as supplemented
by Order No. 29998 March 14, 2006, in the above-referenced proceeding, approvig the
acquisition ofPacifiCorp by MidAerican Energy Holdings Company ("MEHC"), of an afliate
interest transaction. Rocky Mountain Power hereby submits an original and seven copies each of
the Non-Exclusive Easement Agreement (Easement) and the Non-Exclusive Surface Use and
Damages Agreement (Surace Use Agreement) by and betweèn PacifiCorp ("Rocky Mountan
Power" or the "Company") and Cottonwood Creek Consolidated Irgation Company (CCCIC).
The Easement is included as Atthment A and the Surace Use Agreement is included as
Atthment B. CCCIC is a non-profit company that holds water rights in the Cottonwood Creek
draiage, located in Uta. The Company curently own approximately 26 percent of the shares
of CCCIC. Additionally, CCCIC helps to mane access to certin water supplies on behaf of
PacifiCorp. The Company's ownership interest in CCCIC may create an affiliate relationship in
some PacifiCorp jursdictions.
The Company uses the water obtaned through CCCIC as par of the supply to its Hunter
Plant located in Emery County, Uta. Whle the Company has owned a certin percentage of
shars in CCCIC since the early 1970's, a recent review of the ownership strctue led to the
conclusion that the relationship with CCCIC may constitute an afliated interest.
Easement
CCCIC requested a perpetual easement from PacifiCorp across a portion of the Hunter
generation plant property for the purose of holding a regulating reservoir and a portion of a
water pipeline. The Easement is necessa as par of the "Cottonwood Project," which will
convert its delivery system from "open-ditch" to a pressurzed pipeline delivery/irrgation
system. Par of ths project involves the constrction of the Adobe Wash Reservoir, which will
unquely benefit Rocky Mountan Power. Ths is curently under constrction in the Cottonwood
Idaho Public Utilities Commission
September 22, 2011
Page 2
Creek dringe area in Uta. To define the terms and conditions for the constction of the
Adobe Wash Reservoir, among other things, Rocky Mountan Power and CCCIC entered into
the Constrction Funding and Share Assessment Agreement executed in Febru 2011.
Pargraph 6(g) of ths agreement requires Rocky Mountan Power to provide an easement to
accommodate the portion of the Adobe Wash Reservoir that will be located on Rocky Mountain
Power propert. The Easement is intended to fufill the requirements of Paragraph 6(g) of the
Constrction Funding and Share Assessment Agreement.
The CCCIC Board of Directors and all CCCIC shareholders have agred that landowners
that are CCCIC shaeholders grting an easement to CCCIC for the project would chage no
fees. Therefore, as a shaeholder, Rocky Mountan Power ha agreed not to chage CCCIC for
the easement. The estimated market value of the easement, developed though an internl
valuation process, is approximately $10,769.74.
Sunace Use Agreement
Pargrph 6(f) of the Constrction Funding and Share Assessment Agreement requires
Rocky Mountan Power to enter into a non-exclusive surace use agreement to provide grvel
and clay for the Adobe Wash Reservoir. The Surace Use Agreement at issue here is intended to
fufill the requirements of Pargraph 6(f) the Constrction Funding and Shae Assessment
Agreement. A legal description of the afected propert is included with the Surace Use
Agreement as Exhbit A.
The Surace Use Agreement would allow CCCIC to use certain Rocky Mounta Power
propert near the Hunter Plant. CCCIC may test the subsurace materials to determine if they
will be suitable for use in constrction of the Adobe Wash Reservoir. If the materials are deemed
suitable, CCCIC will present Rocky Mounta Power with a plan of operations to describe how
the materials will be extacted. CCCIC must use the propert in such a way as to not intedere
with utilty operations. CCCIC must also pay fair market value, as established in Addendum 1 to
the Surace Use Agreement, for any materials extracted and removed from Rocky Mountan
Power's propert. CCCIC will also be responsible for any damages to Rocky Mountain Power
property incured as a result of operations occurng under the Surace Use Agreement.
The Easment and Surace Use Agrement are in the public interest because they are par
of a project to provide a more reliable and long-term source of water for the Hunter Plant and
reduce operation and mantenance costs.
Please do not hesitate to contact me if you have any questions.
Very Truy Yours,7t~$.~
Mark C. Moench
Senior Vice President and General Counsel
Rocky Mounta Power
Enclosures
ATTACHMENT A
WHEN RECORDED, RETURN TO:
PacifiCorp
Propert Management Departent
1407 West North Temple, Suite 110
Salt Lake City, Utah 84116
NON-EXCLUSIVE EASEMENT AGREEMENT
PacifCorp, an Oregon Corporation, whose address is 1407 West North Temple,
Salt Lake City, Utah 84116, ("Grantor") for good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, hereby grants to Cottonwood Creek
Consolidated Irrigation Company, a non-profit mutual irrigation company organized
under the laws of the State of Uta, whose address is P.O. Box 678, Orangevile, Utah
84537 ("Grantee") a perpetual non-exclusive easement and right of way ("Easement") over
and across certain parcels of real property owned by Grantor ("Grantor's Land") located in
Emery County, Uta, more paricularly described in Exhibit "A" hereto, for the sole
purose of constrcting, operating, maintaining, repairing, inspecting, laterally supporting,
and replacing a water delivery pipeline system, water regulating reservoir, and related
facilities (collectively, the "Facilties") subject to the terms and conditions set forth below,
said Easement lying within Easement NO.6 in Exhibit "B", hereto and within a strip thirty
(30) feet wide and extending fifteen (15) feet on each side of and lying parallel and
adjacent to the lines of reference and projections thereof described more paricularly at
Easement Nos. 1 through 5 in Exhibit "B", hereto.
1. Grantee's Use.
a. Grantee shall have a non-exclusive right to install, operate, inspect, repair,
replace, and maintain the Facilities. During construction periods, not to exceed three (3)
years from the execution date of this Easement, Grantee and its agents may use twenty (20)
additional feet of Grantor's property extending ten (10) feet on each side of and lying
parallel and adjacent to said Easement in connection with the construction of said
Facilities.
b. Grantee wil not store materials for extended periods or refuel vehicles or
equipment on Grantor's Land. The use of hazardous materials is prohibited on Grantor's
Land.
c. Grantee acknowledges that Grantor's existing or future power lines,
pipelines, or generation facilties are or may be located within the Easement boundares
and agrees to conduct its activities in compliance with all applicable laws, codes, rules,
regulations, and standards regarding such power lines. Grantee's use of Grantor's Land
shall comply with National Electric Safety Code, and OSHA clearance standards. Except
as provided in this Agreement, Grantee shall not make or allow any use of Grantor's Land
that is inconsistent with or that may interfere with Grantor's operation, maintenance, repair,
or upgrade of its existing power line, pipeline, or generation facilities and installations or
any additional powerline, pipeline, or generation facilties or installations that may be
constructed hereafter.
eecie Easement - Phase i
d. Except at the Adobe Wash Reservoir and Dam site, Grantee shall at no time
place, use or permit to be used on said Easement construction cranes or other equipment
having a boom or similar attachment which may come in contact with Grantor's overhead
electric lines. At no time shall Grantee place any equipment or material of any kind that
exceeds fifteen (15) feet in height, or that creates a material risk of endangering Grantor's
facilities, or that may pose a risk to human safety within twenty (20) feet overhead electric
lines. Grantee shall maintain a minimum distance of twenty (20) feet between equipment
and transmission line conductors (wires).
e. Grantee wil not excavate within fifty (50) feet of Grantor's existing
transmission structures. Grantee shall maintain a minimum distance of fifty (50) feet
between the Facilities and Grantor's structure(s) and transmission line conductors (wires).
Grantee shall maintain a minimum distance of thirty-five (35) feet from finished grade to
conductors. Grantee shall maintain a minimum distance of fifty (50) feet between
approved facilities and the point where the transmission line (steel/wood pole/guy
anchor/steel pole) enters the earth. To the extent these distances provided in this paragraph
prevent the reasonable exercise of Grantee's rights under this Agreement; the Easement
boundaries wil be altered as reasonably necessary.
f. Grantee shall, at its own expense, promptly repair any damage to the
Easement area or adjacent lands to Grantor's reasonable satisfaction caused by, or in any
way arising out of, Grantee's use of the Easement, including replacing topsoil to the
original surface contour or elevation. Grantee agrees to repair any substantial material
surface damages due to erosion or settling that may occur due to natural precipitation
events within the easement area. This commitment shall be for a period of three (3) years
or until native vegetation is established through natural processes. If Grantee fails to do so
within a reasonable amount of time after written request from Grantor, Grantor may
perform the restoration work at Grantee's expense.
g. This Easement is limited to the construction of the identified Facilties
along the route contemplated herein. Grantee may not install laterals, taps, or sub-feeds
from the Facilities without a separate grant of easement from Grantor.
h. Grantee shall be solely responsible for the cost of any cathodic or other
protection of the Facilities necessitated by its proximity to Grantor's existing or future
electric power lines.
i. Grantor's maintenance and future construction of additional power lines and
other facilities require the use and operation of equipment weighing twenty thousand
(20,000) pounds per axle (including wire pullers and similar equipment weighing in excess
of one hundred thousand (100,000) pounds and cranes weighing one hundred thirt
thousand (130,000) pounds above and over the Facilties. Grantee shall bur that portion
of the Facilities that wil be placed underground to a depth that is sufficient to protect the
Facilities from Grantor's use of equipment with weights identified above. Grantee shall be
solely responsible for any damage to Grantee's facilties caused any failure to meet this
standard.
eeeie Easement - Phase i
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j. Grantee shall restore and level the surace of Grantor's Land, as nearly as
can reasonably be done, from any damage caused by construction, inspection,
maintenance, repairs or removal of the Facilties. If Grantee fails to do so within a
reasonable amount of time after written request from Grantor, Grantor may perform the
restoration work at Grantee's expense.
2. Right of Access. Grantee shall have the right of reasonable ingress and
egress to and from said Easement over and across Grantor's Land, provided that such
access does not materially interfere with Grantor's utilty operations.
3. Grantor's Use. Grantor expressly reserves the right to use the Easement for
any purose that is not inconsistent with the puroses for which this Easement is granted,
including the right to cross and re-cross the Easement with equipment, personnel, overhead
or underground power lines, and access roads at any location or locations, and to grant or
convey additional uses of the Easement to others for any purose not inconsistent with the
rights granted hereunder. Grantee wil provide adequate protection for the Facilties for
such uses.
4. Use of Grantor's Remaining Property. This Easement shall impose no
restrictions upon Grantor's use of Grantor's Land outside the Easement ("Grantor's
Remaining Property"). Any uses of Grantor's Remaining Property, including but not
limited to uses for electricity generation, transmission or other utilty puroses, shall not be
deemed to interfere with Grantee's uses under this Easement. Any use by Grantee of
Grantor's Remaining Propert shall be strictly limited to access as provided in this
Easement. This Easement confers no secondar rights upon Grantee with respect to
Grantor's Remaining Property.
5. Indemnification. Grantee shall protect, defend, indemnify, and hold
harless Grantor, its officers, directors, employees, subsidiaries and affiliates (collectively
"Indemnitees") from and against any losses, claims, liens, demands and causes of action of
every kind, including the amount of any judgment, penalty, interest, or court cost, arising
in favor of any party, including governental agencies or bodies, on account of taxes,
claims, liens, debts, personal injuries, death or damages to propert, violations of
Environmental Laws and Regulations, and all other claims or demands caused by
Grantee's use of or activities on or around Grantor's Land, except to the extent such losses,
claims, liens, demands and causes of action are caused by the Indemnitees. For puroses
of this agreement, "Environmental Laws and Regulations" shall mean all present and
future federal, state and local laws and all rules and regulations promulgated thereunder,
relating to pollution or protection of the environment.
6. Damages. In addition to the general indemnification provisions above,
Grantee agrees that if Grantee or its activities under this Agreement cause any damage to
Grantor's utilty equipment or facilties, whether above or below ground, Grantee wil
reimburse Grantor. for all costs incured by Grantor to repair or replace such damaged
equipment or facilities. As used in this Section, any reference to Grantor's equipment or
facilties shall include any equipment or facilties owned by third parties that are lawflly
located on the Grantor's Land, whether by easement, license, lease, or otherwse.
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7. Abandonment. If Grantee ceases to use the Easement for a period of 12
consecutive months, this Easement shall terminate thirty (30) days after written notice
from Grantor. Upon termination Grantee shall remove its Facilities and restore the land as
near as possible to its condition prior to Grantee's entry thereon; or, with Grantor's prior
written permission, leave all or a portion of its Facilities in place and relinquish all right,
title, and interest to the Facilities to Grantor.
8. Taxes and Assessments. Grantee shall pay all taxes and assessments of any
kind which shall be levied against the Easement by reason of Grantee's use or occupancy
thereof, except those being contested in good faith, and shall keep the Easement free from
any liens that may attach thereto by reason of Grantee's use or occupancy thereof.
9. Attorneys' Fees.
i. If a par to this Agreement commences an action or claim against the other
pary, whether litigation, arbitration or otherwise, respecting any dispute or claim arising
out of or relating to this Agreement, each part shall be solely responsible for its own costs
directly incured related thereto and shall not have a right of contribution therefore or
otherwise seek payment from the other pary.
ii. Notwithstanding the foregoing, in the event a pary commences an action or
files a claim against the other party seeking to enforce any term or provision of this
Agreement, PacifiCorp may be assessed or otherwise obligated to pay amounts related to
such attorney fees otherwise chargeable to the corporation and which is chargeable to all
shareholders, whether directly through a special assessment or indirectly through an
anual-member minimum assessment. In such event, PacifiCorp, as a CCCIC shareholder,
shall not be assessed an amount per Class A share greater than any other Class A
shareholder. CCCIC Class B shares shall be assessed an amount per share as determined
by the Board of Directors.
10. Governing Law. This agreement shall be governed by the laws of the State
of Utah, without giving effects to its conflct of law rules contained therein.
11. Assignment. Grantee shall not assign or transfer its rights or interest in this
Agreement without the written consent of Grantor.
12. Entire Agreement. This Agreement represents the entire and integrated
agreement between Grantor and Grantee with respect to the matters contained herein and
supersedes all prior negotiations, representation or agreement, either rewritten or oraL. This
Agreement may be amended only by wrtten instrument signed by both Grantor and
Grantee.
13. Severabilty. In case a provision of this Agreement is held to be invalid,
ilegal or unenforceable, the validity, legality and enforceabilty of the remaining
provisions shall not be affected.
14. Interpretation. Each term hereof shall be construed simply according to its
fair meaning and not strictly for or against either pary. The parties have jointly prepared
eeeie Easement - Phase i
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this agreement, and no term hereof shall be constred against a party on the ground
that the pary is the author of that provision.
15. Counterpars. This Agreement may be executed in one or more
counterparts, which together shall constitute the Agreement.
16. Signatures. Each individual executing this Agreement, represents and
warants that he or she has been duly authorized by appropriate action of the governing
body of the pary for which he or she signs to execute and deliver this Agreement in the
capacity and for the entity set forth where he or she signs and that as a result of his or her
signatue, this Agreement shall be binding upon the pary for which he or she signs.
IN WITNESS WHEREOF, this Agreement shall be dated and effective upon the
date of the last signature below:
Grantor:
PacifiCorp, an Oregon corporation
Signature:Title:
Print Name:
Dated:
Grantee:
Cottonwood Creek Consolidated Irrigation Company, a non-profit mutual irrigation
company organized under the laws of the State of Utah
Signature:Title:
Print Name:
Dated:
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ACKNOWLEDGMENT
STATE OF
COUNTY OF
)
) ss.
)
On this day of , 2011, personally appeared before me
, who being by me duly sworn, did say that he/she is
the signer of the within instruent on behalf of PacifiCorp, an Oregon corporation, and
that the within and foregoing Non-Exclusive Easement Agreement was signed on behalf of
PacifiCorp by actual authority.
Notary Public
My commission expires:Residing at
ACKNOWLEDGMENT
STATE OF
COUNTY OF
)
) ss.
)
On this day of , 2011, personally appeared before me
, who being by me duly sworn, did say that he/she is
the signer of the within instrument on behalf of Cottonwood Creek Consolidated Irrigation
Company, a non-profit mutual irrigation company organized under the laws of the State of
Utah, and that the within and foregoing Non-Exclusive Easement Agreement was signed
on behalf of Cottonwood Creek Consolidated Irrgation Company by actual authority.
Notar Public
My commission expires:Residing at
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Exhibit "A"
Easement Parcel i
PacifiCorp Parcel UTEM-0514 (County Taxlot Number U5-34-5)
SE/4 of the NE/4 of Section 18, Township 19 South, Range 8 East, SLM, less and excepting
state road 10 right of way.
Easement Parcel 2
PacifiCorp Parcel UTEM-0451 (County Taxlot Number U5-34-6)
The SE/4 of the NE/4 and the SE/4 of the SW/4 lying South of State Highway 10 in Section
17, Township 19 South, Range 8 East, SLM; the NE/4 of the SE/4 of Section 17, Township
19 South, Range 8 East, SLM.
Easement Parcel 3
PacifiCorp Parcel UTEM-0153 (County Taxlot Number U5-33-4)
The N/2 of the SE/4 of Section 17, Township 19 South, Range 8 East, SLM; the NW/4 of the
SW/4 of Section 17, Township 19 South, Range 8 East, SLM; all of the N/2 lying south of
State Highway NO.1 0, Section 17, Township 19 South, Range 8 East, SLM.
Easement Parcel 4
PacifiCorp Parcel UTEM-0120 (County Taxlot Number L4-16-12)
Beginning at the NW corner of the SW Quarter of Section 14, Township 18 South, Range 7
East, SLM; running thence S. 89° 56' 40" East 220 feet; thence S. 51° 1 l' 44" East 2,149.27
feet; thence N. 89° 58' 27" East 764.42 feet; thence N. 89° 46' 07" East 473.91 feet; thence N.
01° 02' 25" East 561.08 feet; thence S. 88° 01' 59" East 155.28 feet; thence S. 38° 44' 06"
East 83.46 feet; thence N. 53° 27' 53" East 83.25 feet; thence N. 41° 06' 43" West 232.02
feet; thence N. 01 ° 09' 31" East 294.76 feet; thence N. 89° 47' 25" East 379.83 feet; thence N.
64° 05' 37" East 34.63 feet; thence N. 42° 53' 55" East 67.11 feet; thence N. 71° 14' 01" East
287.53 feet; thence South 1,150 feet; thence East 1,320 feet; thence South 1,320 feet; thence
West 5,280 feet; thence North 2,640 feet to point of beginning.
Easement Parcel 5
PacifiCorp Parcel UTEM-O 1 20 (County Taxlot Number L4-16- 1 2 and L4-18-0 1)
Beginning at the NW corner of the SW Quarter of Section 14, Township 18 South, Range 7
East, SLM; running thence S. 89° 56' 40" East 220 feet; thence S. 51° 1 l' 44" East 2,149.27
feet; thence N. 89° 58' 27" East 764.42 feet; thence N. 89° 46' 07" East 473.91 feet; thence N.
01° 02' 25" East 561.08 feet; thence S. 88° 01' 59" East 155.28 feet; thence S. 38° 44' 06"
East 83.46 feet; thence N. 53° 27' 53" East 83.25 feet; thence N. 41° 06' 43" West 232.02
feet; thence N. 01° 09' 31" East 294.76 feet; thence N. 89° 47' 25" East 379.83 feet; thence N.
64° 05' 37" East 34.63 feet; thence N. 42° 53' 55" East 67.11 feet; thence N. 71° 14' 01" East
287.53 feet; thence South 1,150 feet; thence East 1,320 feet; thence South 1,320 feet; thence
West 5,280 feet; thence North 2,640 feet to point of beginning.
Easement Parcel 6
PacifiCorp Parcel UTEM-O 1 36 (County Taxlot Number L4- 1 9-06)
The North/2 ofthe SE/4 of the SW/4 of Section 24, Township 18 South, Range 7 East, SLM.
eeeie Easement - Phase i
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Exhibit "B"
Easement No. i
Beginning at a point on Grantor's north propert line which is West, 15.00 feet along the 40 acres
line from the Northeast comer of the Southeast quarter of the Northeast quarter of Section 18,
Township 19 South, Range 8 East, SLB&M; thence S 0°30'32" E, 1,031.31 feet more or less to the
Grantor's south propert line.
Easement No.2
Beginning at a point on Grantor's north propert line which is N 0°29'53" W, 98.77 feet along the
40 acres line and West, 15.00 feet from the East quarer comer of Section 18, Township 19 South,
Range 8 East, SLB&M; thence S 0°29'53" E, 1,435.74 feet more or less to the Grantor's south
propert line.
Easement No.3
Beginning at a point on Grantor's west propert line which is S 0°29'53" E, 860.74 feet along the
40 acres line from the East quarter comer of Section 18, Township 19 South, Range 8 East,
SLB&M; thence S 66°10'09" E, 409.88 feet; thence S 73°46'39" E, 447.76 feet; thence S
75°33'34" E, 553.64 feet more or less to the Grantor's east propert line.
Easement No.4
Beginning at a point on Grantor's north propert line which is N 89°48'04" E, 2.69 feet along the
40 acre line from the West quarter comer of Section 14, Township 18 South, Range 7 East,
SLB&M; thence S 28°50'34" E, 348.96 feet; thence S 78°58'24" E, 509.87 feet more or less to
Grantor's east propert line.
Easement No.5
Beginning at a point on Grantor's north propert line which is S 89°43'10" W, 451.27 feet along
the 40 acre line from the Northeast comer of the Southeast quarter of the Southwest quarter of
Section 14, Township 18 South, Range 7 East, SLB&M; thence S 40°58'24" E, 17.19 feet; thence
S 38°47'23" E, 57.00 feet; thence S 65°18'59" E, 145.77 feet to the beginning ofa circular curve to
the right having a radius of 200.00 feet and a central angle of 35°47'30"; thence southeasterly
124.94 feet along the arc of said curve (chord bears S 47°25'14" E, 122.92 feet); thence S
29°31'29" E, 186.87 feet; thence S 18°20'14" E, 444.80 feet; thence S 38°27'19" E, 1,034.31 feet;
thence S 76°13'42" E, 290.98 feet; thence S 65°58'56" E, 412.32 feet; thence S 72°45'40" E,
143.62 feet; thence S 63°50'06" E, 908.36 feet; thence S 24°47'44" E, 460.64 feet; thence S
05°43'14" W, 138.58 feet more or less to Grantor's south propert line
Easement No.6
That portion of the Southeast quarter of the Southwest quarer of Section 24, Township 18 South,
Range 7 East, SLB&M that lies south and west of the Highway SR-57 right-of-way and more
particularly described as follows: Beginning at the Northwest comer of the Southeast quarter of
the Southwest quarter of Section 24, Township 18 South, Range 7 East, SLB&M and running
thence S 0°18'46" E, 1,339.02 feet along 40 acre line to the Southwest comer of said Southeast
quarter; thence N 89°39'59" E, 1,339.05 feet along 40 acre line to the Southeast comer of said
Southeast quarter; thence N 0°26'59" W, 291.912 feet along 40 acre line to the southwesterly right-
of-way of Highway SR-57; thence Northwesterly along said right-of-way to the north line of said
Southeast quarter; thence S 89°36'18" W, 675.83 feet along 40 acre line to the point of beginning.
Parcel containing 29.88 acres more or less.
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ATTACHMENT B
PacifiCorp
Non-Exclusive Sunace Use and Damage Agreement
Ths Non-Exclusive Surace Use and Damage Agreement ("Agreement") is made and
entered into by and between PacifiCorp, an Oregon corporation, whose address is 1407 West
Nort Temple, Salt Lake City, Uta 84116 ("Owner") and Cottonwood Creek Consolidated
Irrigation Company, a non-profit mutu irrgation company organzed under the laws of the
State of Uta, whose address is Cottonwood Creek Consolidated Irgation Company, PO Box
678, Orangevile, Uta 84537 ("Operator").
RECITALS
Whereas, as of the Effective Date (as defined below), Owner owns the surace of the real
property described on Exhibit A, which is attched to and by ths reference made a part hereof
(the "Propert"), located in Emery County, state of Uta, on which certain above-ground and
below-ground facilities and improvements exist and on which Owner may constrct certin
above-ground and below-ground facilties and improvements in the futue, including but not
limted to electrcal energy generation and transporttion facilties and improvements
(collectively, the "Facilties").
Whereas, Owner has used and will continue to use the Property for the constrction,
operation, maintenance, repair, and replacement of water pipelines, transmission and distrbution
lines and other facilities and equipment normally associated with the generation and distribution
of power and/or the use or leased use of the Propert for communcation structues, facilties,
and equipment. Owner also uses and will continue to use the Propert to access adjoing
propertes and facilties, including properties and facilities that may be used in the futue.
Whereas, the surace of a portion of the Propert (UTEM-0093) is curently being leased
by Royal & Jule An Huntington ("Grazing Lessee"), with said lease expirig Janua 31, 2013.
Whereas, Owner and Operator deem it to be in their mutual interest to enter into ths
Agreement to provide for compatible use of the Property by each par and agree upon the
compensation to be paid to Owner for use of Propert.
Whereas, Owner and Operator have entered into an agreement called Constrction
Funding and Share Assessment Agreement dated, March 9, 2011, and paragraph 6(f) states that
Owner shall enter into a Non-exclusive Surace Use Agreement and Damage Agreement to
provide gravel and clay for the constrction of the Adobe Wash Reservoir.
NOW THEREFORE, in consideration of the mutual benefits and consideration in hand
paid, and other good and valuable consideration, the receipt and suffciency of which are hereby
acknowledged, the paries hereto agree as follows:
1. Right-of-Way. Ower grants Operator, its employees, contractors, and agents, a
right-of-way to enter upon and use the Property for the purose of extracting sand, gravel and
clay resources, including sureying, stang, sampling, drllng, completing, producing and
operating a sand, gravel and clay mining operation ("Activities") on the Propert; constructing
and maintaning access roads, mining operations, and gravel sorting facilities; and for other
puroses specified in ths Agreement, subject to the terms of ths Agreement.
2. Limitation on Rights. Unless otherwse agreed to by the Ower in wrting, the
Propert may not be used by Operator in connection with operations on premises located on land
other than the Propert without Owner's wrtten consent; such wrtten consent will not be
uneasonably witheld. Operator and its employees, contractors, and agents shall not distub,
use or travel on any of the propert of Owner not subject to this Agrement without Owner's
prior consent. Operator may not use, for any purose, lands withn fift (50) feet of any existing
or projected Facilities as described on Exhibit B, which is attched to and by ths reference made
a par hereof and may be updated from time to time as required, without prior wrtten consent of
the Operator. Operator shall reasonably limit its activities so as to use only so much of the
Propert as is necessar for such limited puroses, while allowig Owner or its designees the
greatest use of the Propert for its own or any other purose. Operator agrees to reasonably
accommodate its activities and use of the Propert to Owner for its priar use of the Property.
Operator agrees to pedorm its activities in a maner that will not materially intedere with
Owner's use of its Propert whether now or in the futue in order that Owner may constrct,
maintain, repair, replace or add additional Facilities as Owner reasonably deems necessar,
without additional material cost, inconvenience, expense, daage or injur to Owner, or its
agents, independent contractors and employees. Operator shall have a utility locating service
identify all above and below ground utilties prior to the commencement of the Activities and
shall be responsible to coordinate and secure wrtten agreements with any easement holder to
insure that all existing rights are maitaned.
3. Non-exclusive Rights. The rights granted by Owner to Operator are non-
exclusive, and Owner reserves the right to use all access roads and all surace and subsurface
uses of the Propert and the right to grant successive easements therein or across on such terms
and conditions as Owner deems necessar or advisable, except that successive easements shall
not intedere with or obstrct Operator's rights of access or damage roads or rights-of-way
constrcted by Operator or materially increase Operator's cost to maintain the right-of-way.
4. Notification.
a. Resource Identifcation Phase. Operator shall notify Owner prior to
initial entr upon the Propert for conducting testing to determine the quatity and quality of the
sand, gravel and clay resources, including sureying, stang and sampling in order to identify an
area of development. Operator shall be responsible to identify and mark all underground utilties
and pipelines on the Propert.
b. Planning Phase. Operator shall contact Owner to request an initial
plang conference as soon as the Operator has identified the extent of the potential areas of
development.
c. Permittng Phase. Prior to the commencement of operations, Operator
shall apply for and obtain all permits required for sand, gravel and clay resource extraction
operation with either the federal governent or the State of Uta, which may include but not be
limited to permits required under the Resource Conservation and Recovery Act (RCRA); the
Underground Injection Control (UIC) program of the Safe Drinking Water Act; the National
Pollutat Discharge Elimination System (NDES) (§ 402 Permt) and Dredge and Fil (§ 404
Permt) programs under the Clean Water Act; the Prevention of Signficant Deterioration
progr under the Clean Air Act; and other relevant environmental permts. Prior to the filing
of applications for such permits, Operator shal invite Owner along on an on-site inspection of
the proposed sites and for review of all permit applications.
In addition, Operator shall provide Owner with the results of: (l) the baseline Phase I
environmental site assessment (ESA) of the Propert; (2) detail surey plat of areas of
development including all potential operations and all underground utilties and pipelines as
identified by a utility locating service; and (3) analysis of representative soil samples prior to
distubance by production. Such information shall provide a baseline for post-minng
reclamation requirements.
d. Commencement of Operations Phase. Operator shall notify Owner
fort-eight (48) hours prior to commencing their operations on the Propert. Such notice shall
reasonably specify the type of activity and detail schedule of operations contemplated. Operator
shall not commence any operations until the Plan of Operations (Section 5) is approved in
wrting by Owner and until all bonding and insurance requirements have been met by Operator.
5. Plan of Operations. Prior to the commencement of operations, including: sand,
gravel and clay extraction, constrction of access roads, processing plants on the Propert,
Operator shall consult with and receive Owner's wrtten approval, as otherwse described in ths
Agreement, as to the location of all operations including roads, processing plant, etc. to be placed
on the Property. Afer such consultation and prior to the commencement of operations, Operator
shall present to Owner a draft of a Plan of Operations which details the scope, timing of
development, and stadards for: constrction of operations; protection of existing water
resources; and reclamation, including the location of the operations. Owner and Operator shall
timely and jointly review and develop a final version of the Plan of Operations (which may be
revised from time to tie by mutu consent as conditions wart), and it shall become the
document from which orderly development proceeds. The Operator may not proceed with
operations on the Propert until the Owner has approved the Plan of Operations, such approval
not to be uneasonably witheld. The Plan of Operations shall provide the general framework
for Operator's activities on the Propert. Owner and Operator shall from time to time revise the
Plan of Operations to be sure that all of Owner's and Operator's facilities are accurtely
accounted for and displayed on a curent version of the map.
The Plan of Operation shall also include a section of how the Operator shall handle any
spil or release of oil, gas or other petroleum products and the stadard operating procedures to
contain and clean up any such event. This plan shall include providing notice to PacifiCorp
(Kyle Singleton - 435-748-6527) within twenty-four (24) hours of said release. Notwithstading
any other provision in ths agreement, Operator shall be responsible for all clean up of all oil, gas,
or other petroleum products spils to Owner's satisfaction.
6. Additional Details of Operations. To the maximum extent possible, Operator
will use existing roads on the surace of the Propert for its operations. Operator shall maitain
existing roads as necessar. If constrction of a new road is required, Operator will locate the
new road in a maner so as to cause the least intederence with Owner's operations and facilties
on the Propert, to the extent reasonable. If a pipeline or power line is to be instaled by
Operator, Operator will locate the pipeline or power line in a maner so as to cause the least
intederence with Owner's operations and facilities on the Property, to the extent reasonable.
7. Cooperation. Operator will cooperate with Owner, or Owner's designee, in
implementing decisions made by the Owner, in its sole discretion, to constrct, modify or
remove Facilties, (includig, where necessar or requied, signg land use permt applications
and related documentation) in applying for, complying with or obtaining any land use permts
and approvals, building permits, environmenta permits, environmental reviews or any other
approvals required for the financing, construction, installation, replacement, relocation,
maintenance, operation or removal of the electric generation or transporttion facilties.
Operator wil not oppose or object to Owner obtainig any such land use permts and approvals,
building permts, environmental permits, envionmental reviews or any other approvals required.
For its par, Owner will cooperate with Operator by providing land-owners consent to the
pedormance of any act or the conduct of any operation where the provisions of applicable law,
rule or reguation of any federa, state or local governenta or reguatory agency shall require
same. Owner also agrees that it will use the propert in a maner that will not intedere with the
rights and privileges granted to Operator in this agreement and agreed to in the Plan of
Operations.
8. Protection of and Restrctions on Use of Propert. Operator shall tae
reasonable steps to prevent fie and to promptly extinguish fire. Operator shall endeavor to use
diesel powered vehicles whenever possible to avoid fies resulting from cataytic converters.
Operator may not constrct open fires on the propert. No trash or timber slash will be bured
by Operator on the Propert. Operator shall promptly and fully compensate Owner for all
daages caused by fire arising out of Operator's operations, including, without limitation, any
charges incured by Owner for fire suppression.
Operator shall not permit any of its employees or contrtors operating hereunder
to brig any fiear, explosive device, weapon, alcoholic beverage, or ilegal drg on Owner's
propert. Operator's employees shall at all times car identification. Operator's employees will
not bring dogs or other anmals in vehicles or otherwise on to Owner's lands. Operator shall not
place any trash, rubbish or debris on Owner's land. No employee or contractor of Operator shall
hunt, prospect for antlers, fossils or antiquities, consume alcoholic beverages or car on any
ilegal activities on the Propert. Operator shall not establish living quarters for its employees
and contractors on the Propert.
Absent Owner's consent, Operator's equipment not required for daly opetions
shall not be stacked or stored on the Propert nor shall equipment be maintained on any of the
Propert except where a contaent area has been constrcted to contain any potential fuel
leas from a designated fuel ta or vehicle.
9. Construction Standards. Operator shall constrct all facilties, including roads,
crushing and processing facilities so as to cause the least possible interference with Owner's
existing and futue operations and facilities, to the extent reasonable. Constrction shall not
begin uness Owner has agreed to the Plan of Operations.
10. Maintenance. Operator shall at all times keep the road rights-of-way, and other
areas used by Operator safe and in good order, free of noxious weeds, littr and debris. Operator
shall tae all steps necessar to prevent the release or discharge of any toxic or hazardous
chemicals or wastes on the Propert, including vehicular fuel and lubricants. In the event of an
accidental discharge, Operator shall contact PacifiCorp (Kyle Singleton 435-748-6527) withi
twenty-four (24) hours of discharge and will mitigate any damage using stadard procedures
acceptable to PacifiCorp for cleanup and restoration of the afected area.
11. Consolidation. Whenever possible, Operator will locate their operations, roads
and processing plant in the smallest space possible, where practical. Operator will place all roads
in common corrdors or rights-of-way, if reasonable. The consolidated facilties may not be used
for operations connected to the extent possible with lands outside the Propert without Owner's
wrtten permission.
12. Damage to Improvements and Livestock. No improvements, including but not
limited to fences gates and cattle guads, shall be cut, daaged or destroyed by Operator without
the prior wrtten consent of Owner and the payment of additional damages or the initution of
other safeguds to protect the rights and propert of the Owner, including but not limited to cost
of replacement or repair of such Facilities, including powerlines and water pipelines. Payments
shal be due and payable prior to any such daage or with thi (30) days if Operator fails to
seek prior wrtten consent from the Owner.
13. Damage to PacifiCorp Facilties. In addition to the other payments provided for
in this Agreement, Operator shall pay to Owner all of the costs directly resulting from daage to
Owner's water pipeline(s) impaied or requied to be taen out of operation by Operator's
actions. Owner shall be contacted immediately upon any event that daages the water
pipeline(s). Owner shall be responsible to repair the damage and shall send an invoice to
Operator for the actul costs associated with the repairs.
14. Payments by Operator to Owner.
a. Payment. A fair market value will be established for each product type
that will be mined and removed from the Propert (e.g., sad, gravel, and clay material) on a per-
unt basis as shown on Addendum 1. The quatities of materials provided by PacifiCorp will be
tracked and used to determe the total value of materials provided. Ths total value will then be
deducted from PacifiCorp's capital contrbution described in the Constrction Funding and Share
Assessment Agreement dated March, 9, 2011.
15. Payment, Penormance and Reclamation Bond. Prior to commencement of
operations, Operator shall provide Owner with a Payment, Performance and Reclamation Bond
(or equivalent security), approved by Owner, in which either Operator or Operator's constrction
contractor, as principal, and the surety are held and firmly bound to Owner for payment and
performance, each in an amount at least equal to one millon dollars ($1,000,000), as securty for
the faithl performance and payment of all of Operator's obligations under its Plan of
Operations, its permits, and its reclamation obligations for the Propert. The Payment,
Pedormance and Reclamation Bond shall be executed by a surety included in the list of
"Companes Holding Certificates of Authority as Acceptable Sureties on Federal Bonds and as
Acceptable Reinsurg Companes as published in Circular 570 by the Audit Staff Bureau of
Governent Financial Operations, U.S. Treasur Deparent." If the Payment, Performance
and Reclamation Bond is signed by an agent, it must be accompaned by a certified copy of the
agent's authority to act. The surety company must be authorized to do business in the state of
Uta and have an agent for service of process in the state of Utah. If the surety on the Payment,
Pedormance and Reclamation Bond fushed by Operator petitions, either informally or
formally, for banptcy, becomes insolvent, has its right to do business in the State of Uta
terminted, or ceases to meet the requirements of ths section, Operator shall withn ten (l0) days
thereafter substitute another Payment, Performance and Reclamation Bond and surety, both of
which must be acceptable to Owner. The Payment, Performance and Reclamation Bond shall be
maintained in full force and effect until all requirements for reclamation and remediation of the
Property have been fulfilled by Operator, and Operator supplies Owner with proof of the
payment in full of all costs for reclamation and remediation of the Propert. Ths Payment,
Pedormance and Reclamation Bond shall be in addition to any pedormance bond required by
any local, state or federal agency.
16. Liabilty for Damage. Ths Agrement does not relieve Operator from liabilty
for damage caused by Operator's negligence or by spils or discharges of any toxic or hazardous
chemicals or wastes due to Operator's operations.
17. Damage to Lands Owned by Other Landowners. Operator shall be liable for
any daage to other lands or the operations of other landowners, including but not limted to,
roads, road crossings, bridges, fences, buildings and other improvements, livestock, crops,
groundwater, forage, and hay meadows, resulting from Operator's activities on the Propert.
is. Reclamation. In accordance with the Plan of Operations, Operator shall
reasonably rehabilitate and restore to its original condition, as near as reasonable, all areas
distubed by Operator's operations, unless otherwse agreed to by Owner. With Owner's prior
wrtten permission, Operator may leave all or a portion of the mining operation in place and
relinquish all right, title, and interest to Owner. Applicable stadads for reclamation shal be
included in the Plan of Operations.
19. Termination of Rights. Ths Agreement shall become effective when both
paries have executed ths Agreement ("Effective Date") and shall remain in full force and effect
until complete reclamation and restoration of the surace according to the stadards prescribed
herein and in the Plan of Operations and approval of such reclamation by state and/or federal
authorities having jursdiction over such reclamation or five (5) years, whichever is the shortest
amount of time. In addition, in the event of default by Oprator of any of the terms and
conditions of this Agreement, and the failure of Operator to cure such default with the time
specified in ths Agrement, Owner may elect to suspend the rights of Operator hereunder until
such default is cured, or to terminate ths Agreement. Operator shall have a reasonable time
thereafter in which to remove its facilities and restore the land as near as possible to its condition
prior to Operator's entr thereon.
20. No Warranty. Owner makes no waranty oftitle in entering into this Agreement.
Owner fuher makes no representations or waranties as to the use, condition, or suitabilty of
the Property for Operator's operations on the Propert.
21. Enforcement Costs. If either par defaults under ths Agreement, such par
shall pay all costs and expenses, including a reasonable attorney's fee, incured by the other
par in enforcing ths Agreement.
22. Indemnifcation. Operator shall use the Propert at its own risk and, except for
the obligations of Owner herein, hereby releases and forever discharges any claims, demands or
causes of action it may have against Owner, its offcers, directors, employees, subsidiares,
affliates and contractors arising out of Operator's use of the Propert or conducting its activities.
In addition Operator shall protect, indemnfy and hold haess Ower, its offcers, directors,
employees, subsidiares, affliates and contractors (collectively, the "Indemntees") from and
agaist any losses, clais, liens, demands and cause of action of every kid, including the
amount of any judgment, penalty, fine, interest, cour cost or legal fee incured by the
Indemntees or any of them in the defense of same, arsing in favor of any par, including
governental agencies or bodies, on account of taes, claims, liens, debts, personal injures,
death or damages to propert, violations of Environmental Laws and Regulations, and all other
claims or demands of every character caused by Operator's use of the Propert or conduct of its
activities. The terms of ths Section 22 shall surive the termination of this Agreement. For
puroses of this Agreement, "Environmenta Laws and Reguations" shall mean all present and
futue federal, state and local laws and all rules and reguations promulgated thereunder, relating
to pollution or protection of the environment applicable to the Propert.
Operator shall promptly pay all wages due its workmen and employees and pay for all
materials and supplies fuished for its operations hereunder and shall defend and protect Owner
from and against all claims and liabilties resulting in its failure to do so. Operator shall
indemnify and hold Owner harless from all mechanc's, materialmen's and laborer's liens
against the Propert which may arse by reason of Operator's operations hereunder, and in the
event any such liens are filed agaist the Propert, Operator will tae such steps as may be
necessar to obtan the discharge thereof. Operator shall post and keep posted at the entrce to
its operations on the Propert notice to the public that said operations are being conducted by
Operator and that the interests of Owner as landowner shall not be subject to any lien or claim
arsing therefrom.
23. Insurance. Without limiting any liabilties or any other obligations of Operator,
Operator shall procure, or require that its contrctors procure, and continuously maita for the
duration of ths Agreement, with insurers having an A.M. Best's rating of A-VII or better,
insurce against claims for injur to persons or damage to propert which may arse from or in
connection with this Agreement or Operator's use or occupancy of the Premises as follows:
Workers' Compensation. Coverage as required by law. Operator shall fush
proof thereof satisfactory to PacifiCorp withn 14 days prior to commencing any
work on the Premises. All Workers' Compensation policies shall contain
provisions that the insurance companes will have no right of recovery or
subrogation agait PacifiCorp, its parent, divisions, afliates, subsidiar
companes, co-lessees, co-ventuers, agents, directors, offcers, employees,
servants, and insurers, it being the intention of the PacifiCorp and Operator that
the insurce as effected shall protect all paries.
Employers' Liability. Insurce with a minium single limit of $1,000,000 each
accident, $1,000,000 disease each employee, and $1,000,000 disease policy limit.
Commercial General Liability. The most recently approved ISO (Insurance
Services Offce) policy, or its equivalent, wrtten on an occurence basis, with
limits not less than $1,000,000 per occurence and $2,000,000 general aggregate
(on a per location basis) to protect against and from any and all loss by reason of
bodily injur or propert daage on or about the Premises, including the
following coverages:
i. Bodily injur, propert damage, and personal injur coverage, including
damage to Owner's Electrc Facilties or Improvements as a result of Operator's,
its contrtors', subcontractors' or agents' negligence.
ii. Contrctual liabilty
iii. Premises and Products/Completed Operations
iv.lndependent Contractors
Automobile Liabilty. The most recently approved ISO policy, or its equivalent,
with a minimum single limt of $1,000,000 for bodily injur and propert damage
including sudden and accidental pollution liabilty, with respect to Operator's
vehicles whether owned, hired or non-owned, assigned to or used in any way on
the Premises.
Umbrella Liabilty. Insurce with a mium limt of $5,000,000 each
occurence/aggregate where applicable to the excess of the coverages and limits
required in Employers' Liability, Commercial General Liabilty, and Automobile
Liability insurance in above. Such insurance policies shall be maintained to cover
any liability arsing from Operator's use of the Premises and indemnfication
identified in this Agreement.
a. Certificate of Insurance. Operator shal anually provide to Ower a
certificate of insurance evidencing its insurance coverage. The policies requied
herein, except Workers' Compensation and Employers' Liability, shal include
provisions or endorsements namg Owner, its parent, affiliates, subsidiares, its
offcers, directors, agents, employees or servants as additional insured.
b. Operator's Insurance Priar. To the extent of Operator's negligent acts
or omissions, all policies required under ths Agreement shall be primar with
respect to the interest of Owner and that any other insurance maitained by
Owner is excess and noncontrbutory insurance with the insurance required
hereunder, and provisions that the policy conta a cross liabilty or severabilty of
interest clause or endorsement.
c. No Right of Recovery or Subrogation. Unless prohibited by applicable law,
all required insurance policies shall contan provisions tht the insurer will have
no right of recovery or subrogation against the Owner, its parent, divisions,
affliates, subsidiares companies, co-Operators, or co-ventuers, agents, directors,
offcers, employees, servants, and insurers, it being the intention of the Owner and
Operator that the insurce as affected shall protect all paries.
d. Notice Prior to Chage or Cancellation. Operator's insurance requied
under ths Section 23 shall contan provisions that such policies canot be
cancelled or their limits of liabilty reduced without 1) ten (10) calendar days'
prior written notice to Owner if cancelled for nonpayment of premium, or 2) thrt
(30) calendar days' prior wrtten notice to Owner if cancelled for any other reason.
24. Compliance with Law. Operator shall comply with all federal, stte, and local
laws, including all Environmental Laws and Regulations tht are applicable to the Property or
conduct of its activities. Operator shall also comply with the terms of all permits, licenses, leases,
environmenta assessments, conservation recommendations, and any other rues, reguations,
actions or orders that are applicable to the Propert or the conduct of its activities. Upon request,
Operator shall tae all reasonable measures to demonstrate to Owner that it has complied with
this provision.
25. Inspection and Right to Cure. Subject to the rights of Operator described
herein, Owner reserves the right to access and use the Propert for its own use and to verify
Operator's compliance with the terms of ths Agreement. If Operator fails to pedorm any
covenant, term, provision, agreement, or condition of ths Agreement, Owner shall give Oprator
wrtten notice of such breach and Operator shall have thrty (30) days from receipt of such notice
to remedy such breach. If Operator fails to remedy the breach withn the timeframe provided,
Owner shall have the option, but not the duty, to cure the breach on Operator's behalf. Any
reasonable expense incured by Owner to pedorm any such cure shall be reimbursed by Operator
promptly after receipt of invoice therefore from Owner, in the sae maner as other payments
are made hereunder.
26. Successors and Assigns. Ths Agreement is binding upon the Owner and
Operator and their respective successors and assigns. Operator may not assign its rights or
delegate its duties under ths Agreement without the wrtten consent of Owner; provided that
Operator may freely assign a securty interest in this Agreement to provide for financing of its
working capital needs. This Agreement rus with the Propert and the estate held by the
Operator.
27. Reliquishment. By wrtten document delivered to Owner, Operator may
relinquish its right to use any porton of the Propert. By wrtten amendment signed by Owner
and Operator the legal description for the Property may be changed.
28. Notice. Notice required under ths Agreement may be given to either par by
depositing the same in the United States mail postage prepaid, duly addressed to the appropriate
contact set out below. Such notice shall be deemed delivered when deposited in the United
States MaiL.
29. Constructon of Agreement. Ths Agreement shall be constred under the laws
of the State of Uta and the paries consent to the jursdiction of the Distrct Cour in and for
Emery County, Uta for all disputes arsing hereunder.
30. Entire Agreement; Amendment. Ths Agreement embodies the entire
agreement between the paries hereto concernng the subject matter hereof and supersedes all
prior conversations, proposals, negotiations, understadings and agreements, whether wrtten or
oraL. Ths Agreement may not be amended, altered, changed, modified or supplemented except
by wrtten agreement of the paries.
31. Severabilty. Should any provisions of ths Agreement, to any extent, be held
invalid, ilegal or unenforceable, the remaing provisions of ths Agreement shall remain in full
force and effect, if the essential provisions of ths Agreement for each par remain valid,
binding and enforceable.
32. Notice. Owner designates the following contact person information for the
receipt of notices required under ths Agreement and any other communcations on matters
addressed by ths Agreement:
Ower Contat:
PacifiCorp:
P.O. Box 569
Castle Dale, Uta 84513
Attn: Laren Huntsman, Hunter Plant Manager
Oprator designates the followig contact person for the receipt of notices requied under ths
Agreement and any other communcations on matters addressed by ths Agreement:
Operator Contact:
Cottonwood Creek Consolidated Irrgation Company
P.O. Box 678
Orangevile, Utah 84537
Att: Stan Mathis, Secreta
33. Default. If Operator defaults under this Agreement, Owner shall give Operator
wrtten notice of the default. If Operator fails to correct the default with sixt (60) days afer
the delivery of the notice of default, Owner may, in addition to any other rights and remedies
available to Owner, suspend the right of Operator to enter upon and use the Propert until the
default is cured or termate ths Agreement. If Ower elects to termate this Agreement,
Operator shall remove all of its propert and facilities from the Propert and restore and reclai
the Propert as requied herein.
34. Memorandum of Agreement. This Agreement shall not be recorded, but the
pares may record with the County Clerk of the county in which the property subject to this
Agreement are located a memorandum reciting that the paries have entered into this Agreement
which affects the Propert.
35. Representations. Each par covenants and represents that it has the full right
and authority to enter into ths Agreement and to car out the obligations provided for in ths
Agreement.
36. Confidentiality. Ths Agreement and all of the terms hereof ar confdential and
shall not be disclosed by either Owner or Operator to any unelated thrd pary without the prior
wrtten consent of Owner and Operator, except as required by law, or any cour or administrative
order, rule, or proceeding.
37. No Joint Venture or Partership. Ths Agreement does not constitute or create
an agency, joint ventue, parership or similar relationship or status between the Owner and
Operator.
38. Taxes. Operator shall pay all taes and assessments of any kind, which shall be
levied against the Property by reason of Operator's use, or occupancy thereof, except those being
contested in good faith, and shall keep the Propert free of any liens that may attch thereto by
reason of Operator's use or occupancy thereof.
39. Time. Time is of the essence in this Agreement.
Dated ths day of ,2011.
OWNER:
PacifCorp, an Oregon corporation
Signture:Title:
Prit Name
Date:
OPERATOR:
Cottonwood Creek Consolidated Irgation Company
Signatue:Title:
Print Name
Date:
Exhibit A
Legal Description of Propert
Gravel Resource Extraction Area æorton o(PacifiCorp Parcel UTEM-0122)
Beginning at the Southeast comer of the southwest quarr of the norteas quarer of Section 23,
Township 18 South, Rage 7 East, Salt Lake Base and Meridian; thence North, 1328.5 feet along the
40 acre line to the norteast comer of the southwest quaer of the norteast quaer of said
section 23; thence North, 463.40 feet along the 40 acre line; thence West, 260.04 feet to the
beginnng of a circular cure to the right having a radius of 1101.39 feet and a central angle of
77°43'10"; thence northwesterly 1494.73 feet along the arc of said cure (chord bears N
52°10'15" E, 1382.74 feet) to the north quaer corner of said section 23; thence South, 1322.6
feet along the center line of said section 23 to the northwest corner of the southwest quar of
the norteast quaer of said section 23; thence South, 1322.6 feet along the center line of said
section 23 to the southwest corner of the southwest quaer of the norteast quaer of sad
section 23; thence East, 1328.20 feet along the 40 acre line more or less to the point of begig.
Parcel Containing 60.98 acres more or less
Clay Resource Extraction (PacifiCorp Parcel UTEM-0093)
The Southwest Quaer of the Northeast Quaer of Section 5, T 19 S, R 8 E S.L.B.& M.
The Nortwest Quaer of the Southeast Quaer of Section 5, T 19 S, R 8 E S.L.B.& M.
Contag 80.00 acres more or less
Exhibit B
Existing and Projected Facifities of Owner
CCCIC will call utility locating service to determine the location of all facilities
0 260 520 ft.
‘S’l
..
550 ilOOft.
Addendum 1
Fee Schedule
The terms and conditions of this Addendum 1 are hereby incorporated in the Agrement to
which it is attched as if fully set fort therein:
1. Value of Resource and Quatity of Resource
Estimated Gravel value is 130,000 cubic yards x $0.40 per cubic yard = $52,000*
Estimated Clay value is 52,000 cubic yards x $0.20 per cubic yard = $10,400*
*Note: The clay and gravel resources will be tested durng constrction to ensure that
they meet the engineerg stadads for a reservoir in the state of Uta. It is understood
that the Operator may need to fid another source of either clay or gravel if grvel and
clay on Owner's land doesn't meet the mium stadads. The report requied to
establish the 'Fin Value of Resource" shal reflect an accurate accounting of the actul
volumes of gravel and clay removed from Owner's land.
2. Method of Measurement
The material will be measured in place by neat lines as shown on the drawigs of the
embanent.
3. Monthy Accounting
Operator shall provide a monthly report that provides an accurate tota of cubic yard
volumes of all gravel and clay that were removed from PacifiCorp's land for each month
durng the term of this agreement. That monthly report shall be sent to the following
address:
PacifiCorp:
P.O. Box 569
Castle Dale, Uta 84513
Att: Laren Huntsman, Hunter Plant Manager
4. Final Value of Resource
After all gravel and clay needed for the constrction of the Adobe Wash Reservoir are
removed from PacifiCorp land, a final report will be submitted to Laren Huntsman, at the
address provided above. The final report shall document the total volume of gravel and
clay removed from PacifiCorp land and the value of said materiaL.