EXHIBIT 4.7
THIS AGREEMENT made this 6th day of September, 2002,
BETWEEN:
XXXXXXX X. XXXXXXXX, Businessman, having an address
at Mountain View Ranch, XX 0, Xxx 000, Xxxxx, XX
00000
(hereinafter referred to as the "Lessor")
OF THE FIRST PART
AND:
WESTERN WIND ENERGY CORPORATION, a company duly
incorporated pursuant to the laws of the Province of
British Columbia and having an office located at 000
Xxxxxx Xxxxxx, in the City of Coquitlam, Province of
British Columbia, V3J 2L7
(hereinafter referred to as the "Lessee")
OF THE SECOND PART
WHEREAS the Lessor owns certain real property located in Elgin
Arizona, County of Santa Xxxx identified by the legal description attached
hereto and marked Schedule "A".
AND WHEREAS the Lessee wishes to establish a wind farm on
portions of the Lessor's Property;
AND WHEREAS the Lessee wishes to lease, on the terms and
conditions hereinafter set forth, portions of the Lessor's Property;
NOW THEREFORE WITNESSETH THAT for and in consideration of the
mutual covenants herein and the sum of one dollar ($1.00) now paid by the Lessee
to the Lessor and for other good and valuable consideration, the receipt of
sufficiency of which is hereby acknowledged, the parries hereto agree as
follows:
1. Definitions.
(a) "Test Site" and "Permanent Sites" are hereinafter collectively
referred to as the "Leased Property".
(b) "Wind Farm" means a wind energy conversion facility which
includes tubular steel towers of various heights with rotors
and blades of various dimensions and turbines of various
capacity, meteorological study towers, one or more
transmission distribution switch yards, rights-of-way, roads,
electrical distribution and transmission systems, all
necessary care taker and maintenance facilities, including a
residence, and other required equipment or facilities.
(c) "operation of the wind farm" means the sale of
power produced on the leased property.
2. Test Site.
(1) The Lessor hereby leases to the Lessee a parcel
of land described in Schedule "A" hereto (the
"Test Site") for a term of 50 years, commencing
on the 1st day of September, 2002 and ending on
the 31st day of August, 2052, (the "Test Site
Term").
(2) It is agreed and understood that the Lessee
will operate on the Test Site a meteorological
study tower for a minimum of one (1) year from
the commencement of the Test Site Term, (the
"Testing Period").
(3) Subject to subparagraph (d) hereof, at the
conclusion of the Testing Period, but in no
event later than January 1, 2005, the Lessee
shall commence construction of permanent wind
energy conversion facilities as hereinafter
provided.
(4) In the event that the Lessee does not commence
permitting of permanent wind energy conversion
facilities by January 1,2008, this Agreement
shall be null and void and of no further
effect.
3. Permanent Sites
(a) Using the data collected from the operation of
the meteorological study tower on the Test
Site, the Lessee shall select locations for the
sites for permanent wind energy conversion
facilities on the Lessor's Property, (the
"Permanent Sites").
(5) Subject to the following subparagraphs, the
Lessor shall lease to the Lessee the Permanent
Sites on the terms and conditions set forth in
a further lease, to be prepared by counsel for
the Lessee.
(6) The term of the lease for the Permanent Sites
shall be a period of fifty (50) years,
commencing on the day upon which construction
of the Permanent Sites begins.
(7) The formal lease for the Permanent Sites shall be executed by
the parties to this Agreement, however, if for any reason the
formal lease shall not be prepared or executed, the terms of
this Agreement shall apply mutatis mutandis to the lease of
the Permanent Sites.
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4. Lessee's Covenants. The Lessee covenants with the Lessor as
follows:
For the lease of the Permanent Sites:
(i) for the first fourteen (14) years after commencement
of the "operation of the wind farm" on the Permanent
Sites, to pay to the Lessor:
(a) annual base rent equal to 1.4% of the Lessee's
actual annual gross sale revenue from energy
production on the Permanent Sites; and
(b) minimum advanced payment of US $225,000 to be
deducted from future production.
(ii) following the period described in 4(i) above, and
until the termination of the lease to pay to the
Lessor:
(a) annual base rent equal to 2% of the Lessee's
actual annual gross sale revenue from energy
production on the Permanent Sites; and
(b) additional annual rent equal to 10% of the
amount due under paragraph 4(ii)(A), payable to
a charity to be designated by the Lessor, but in
no event shall the additional annual rent exceed
$50,000 per year.
(2) For the lease of the Permanent Sites, the rent payable
hereunder shall be paid to the Lessor within ninety (90) days
from the anniversary date of the commencement of the
"operation of the wind farm".
(3) To use the Permanent Sites only for the purpose of a wind
energy conversion facility and related purposes.
(4) To maintain in full force and effect, at all
material times hereto, liability insurance in
respect of the Leased Property and the Lessee's
operations thereon.
(5) In respect of roads, either already existing at
the commencement of the term of this Agreement or
to be constructed in accordance with the terms and
conditions of this Agreement, which will in whole
or part constitute access to the Leased Property,
the Lessee shall repair such roads to which damage
is caused by the acts of the Lessee, its servants
and agents, to a state of repair comparable to
that which existed prior to the occurrence of the
damage.
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(6) In respect of roads not already existing at the
commencement of the term of this Agreement, to be
constructed in accordance with the terms and
conditions of this Agreement and forming access to
the Leased Property, the Lessee agrees to
contribute to the cost of constructing the said
roads in accordance with the following:
(1) to the extent that the cost of constructing
the roads does not exceed $10,000 per mile,
the Lessee's contribution to the cost of
constructing the road is 50%; and
(2) to the extent that the cost of constructing
the roads exceeds $10,000 per mile, the
Lessee's contribution to the cost of
constructing the road is 100% of the amount
by which the cost exceeds $10,000.
(8) To construct with due diligence and dispatch all
structures required for the Lessee's operation and
to maintain same in a good state of repair.
(i) At the end of the term of this lease to remove all
equipment and structures and to restore the Leased
Property to such state of repair as is reasonably
required by the Lessor, however, in no event shall
removal of equipment and structures exceed a soil
depth of twelve inches.
(j) To pay the rates and charges for all heat, light,
power and water or other public utilities supplied
to the Leased Property in connection with the
lessee's operation of the wind farm.
(k) To operate the wind farm in a businesslike manner.
(l) To procure all necessary permits and licenses
required for the operation of the wind farm.
(m) To prevent all unnecessary waste, loss or damage
to the Lessor's Property.
5. Lessor's Covenants. The Lessor covenants with the
Lessee as follows:
(a) To lease to the Lessee the Test Site on a rent
free basis.
(b) To allow the Lessee quiet enjoyment of the Leased
Property;
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(c) To grant rights of way, in form satisfactory to
counsel for the Lessee, over all roads, either
existing at the commencement of the term of this
lease or to be constructed in accordance with the
provisions hereof, to enable the Lessee to obtain
access for all purposes to the Leased Property.
(d) For more certainty, in the event that roads are
required to be constructed as access to the Leased
Property, the Lessor agrees to contribute to the
cost of constructing the said roads in accordance
with the following:
(1) to the extent that the cost of constructing
the roads does not exceed $10,000 per mile,
the Lessee's contribution to the cost of
constructing the road is 50%; and
(2) to the extent that the cost of constructing
the roads exceeds $10,000 per mile, the
Lessee's contribution to the cost of
constructing the road is 100% of the amount
by which the cost exceeds $10,000.
(2) Together with the Lessee, to cause the roads
required by the Lessee to be constructed to a
standard such that access will be possible by all
such equipment required by the Lessee for
performance of this Agreement. Road specifications
and locations shall be determined by the parties
hereto upon completion of engineering studies and
design.
(f) The Lessor shall provide to the Lessee and to all
other parties designated by the Lessee such
rights-of-way and easements as may be reasonably
required for electrical transmission and
distribution systems, specifications and standards
for which rights-of-way and easements shall be
determined upon completion of engineering studies
and design.
(g) Except as expressly provided for herein, it shall
be the sole responsibility of the Lessor to
maintain and restore to such state of repair as
reasonably required by the Lessee all roads,
rights-of-way and easements required hereunder
intended for the use and enjoyment of the Lessee.
(h) For more certainty with respect to the covenant
for quiet enjoyment, the Lessor shall not do any
act designed to or having the effect of in any way
impeding or decreasing the output or efficiency of
the wind farm and in particular shall not:
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(i) within a radius of sixty (60) feet of the
situs of any tower, (the "Access Zone"),
erect, construct, place any object or in any
way, block, limit or obstruct access to the
tower or equipment;
(ii) within a radius of four hundred (400) feet
of the situs of any tower, (the "Safety
Zone"), erect, construct, or place any
object or structure, either on a permanent
or a temporary basis; and
(iii) within a three thousand (3,000) feet radius
of the situs of any tower, (the
"Interference Zone"), erect, construct or
place any object or structure, temporary or
otherwise, that exceeds the lesser of:
(A) a height of fifty (50) feet in
elevation above the existing
topography where the base of the
structure is located, or
(B) a height of fifty (50) feet in
elevation above the base of the
closest wind farm tower.
(i) In contemplation of this Agreement, the Lessor has
obtained and may obtain knowledge of confidential
information of the Lessee, including, but not
limited to, technical data, production plans,
marketing and sales information, know-how and
trade secrets, (the "Confidential Information").
The Lessor agrees not to disclose at any time,
either before, during the term of this Agreement
or any subsequent lease of the Permanent Sites or
after, to any person the Confidential Information.
In the event of a breach of this covenant, the
Lessor agrees that the harm suffered by the Lessee
would not be compensable by monetary damages alone
and the Lessee shall, in addition to all other
available legal and equitable remedies, be
entitled to an injunction against such breach or
threatened breach.
(j) The rights granted to the Lessee hereunder shall
be construed as exclusive to the Lessee, its
successors and assigns, and the Lessor shall not,
during the term of this Agreement or any
subsequent lease of the Permanent Sites, grant to
any other person rights similar to those granted
hereunder or any subsequent lease of the Permanent
Sites. This prohibition shall apply to properties
either now or hereafter owned or under the control
of the Lessor within the geographic area of Santa
Xxxx County.
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6. General Provisions. The within Agreement is
subject to the following provisos:
(a) This Agreement shall become null and void and of
no further affect in the event that a
meteorological study tower is not erected on the
Test Site by January 1, 2003.
(b) This Agreement shall become null and void and of
no further affect in the event that permitting on
the Permanent Sites has not commenced by January
1, 2005.
(c) Upon the occurrence of an event described in
either subparagraph 6(a) or 6(b) hereof, the
parties hereto shall be released from their
obligations under this Agreement.
(d) This Agreement may be terminated at any time by
the Lessee upon the Lessee giving to the Lessor
thirty (30) days' written notice of its intention
to terminate, in which event the Lessee shall have
a period of two years from the date that the
notice is received by the Lessor to remove all
structures from the Leased Property to the
standard described in paragraph 4(i) hereof.
(e) Subject to the restrictions hereinbefore set
forth, the Lessor shall have the right to harvest
cattle on the Leased Property, however, in
addition to adhering to the restrictions
hereinbefore set forth, such harvesting must take
place in such a manner and at such times as are
mutually agreed upon by the parties hereto so as
to not interfere with the operation of the wind
farm.
(f) All covenants, conditions, provisos and agreements
hereinbefore contained in, or to the benefit of, are binding
upon the parties hereto and their respective successors and
assigns.
(g) The Lessee may at any time assign or sublet or part with
possession of the Leased Property, or any part thereof.
(h) Any disputes hereunder shall be resolved by arbitration in
accordance with the Arbitration Act.
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IN WITNESS WHEREOF the parties hereto have executed this
Agreement by the hands of their duly authorized officers in that behalf the day
and year first herein above written.
SIGNED, SEALED and DELIVERED )
by Xxxxxxx X. Xxxxxxxx in the presence of: )
)
)
XXXXX CIACHURSKI ) -s- XXXXXXX X. XXXXXXXX
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Name ) XXXXXXX X. XXXXXXXX
)
)
000 XXXXXX XXX. XXXXXXXXX, X.X. )
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Address )
)
)
PARA - LEGAL )
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Occupation )
WESTERN WIND ENERGY CORPORATION )
)
)
Per: )
)
)
-s- XXXXXXX X. CIACHURSKI
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Authorized Signatory )
)
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Authorized Signatory )
EXHIBIT "A"
RANCH LEGAL DESCRIPTION
The East Half of Section 1, Township 20 South, Range 18 East of the Gila and
Salt River Base and Meridian, Santa Xxxx County, Arizona.
EXCEPT
The North 970.00 feet of the East 500.00 feet thereof.
AND
That portion of the Northeast Quarter of Section 22, Township 20 South, Range 13
East of the Gila and Salt River Base and Meridian, lying North of State Road 82,
as it existed in July, 1978, being more particularly described as follows:
Beginning at the Northeast corner of said Section 12;
THENCE South, a distance of 1.919,99 feet to a point on the North right-of-way
State Highway 82 as it existed on July 1, 1978;
THENCE North 68 degrees 53 minutes 43 seconds West, along said right-of-way, a
distance of 2835.75 feet;
THENCE North 00 degrees 04 minutes 10 seconds East, a distance of 900.70 feet to
the north Quarter corner of said Section 12;
THENCE South B9 degrees 57 minutes 40 seconds East, along the North line of said
Section 12, a distance of 2644.45 feet to THE POINT OF BEGINNING.
SUBJECT TO:
A 15.00 foot Easement for Ingress and Egress being the East 16.00 feet of the
following described parcel:
The East Half of Section 1, Township 20 South, Range 18 East of the Gila and
Salt River Base Meridian, Santa Xxxx County, Arizona, AND that portion of the
Northeast Quarter of Section 12, Township 20 South, Range 18 East of the Gila
and Salt River Base Meridian, Santa Xxxx County, Arizona, lying North of State
Highway 82, as it existed in July, 1978, being more particularly described as
follows:
BEGINNING at the Northeast corner of said Section 12 run South, a distance of
1,919.99 feet to a point on the North right-of-way of State Highway 82, as it
existed on July 1, 1978;
THENCE North 68 degrees 53 minutes 42 seconds West, along said right-of-way, a
distance of 2,835.75 feet;
THENCE North 00 degrees 04 minutes 10 seconds East, a distance of 900.70 feet
to the North Quarter corner of said Section 12;
THENCE South 89 degrees 57 minutes 40 seconds East, along the North line of said
Section 12, a distance of 2,644.45 feet to THE TRUE POINT OF BEGINNING.
EXCEPT the North 970.00 feet of said Section 1.
