RESOURCE RECOVERY SYSTEM
AGREEMENT
This Resource Recovery System Agreement,
(hereinafter “Agreement”), entered into this day of
, 2008, (the
“Effective Date”), is made by and between BioGold Fuels
Corporation, a Nevada Corporation, and the Kansas L.L.C., which
will be formed and which will be wholly owned by BioGold Fuels
Corporation, (hereinafter referred to as “BIFC”), the
Nevada Corporation having its principal offices at 1800 Century
Park East, Los Angeles, California, and the L.L.C. having its
principal office in Newton, Kansas, and Harvey County, Kansas,
(hereinafter referred to as “Harvey County”), having
its principal place of business in Harvey County,
Kansas.
1. WHEREAS , Harvey County operates
a Recycling Center and Transfer Station in Harvey County, Kansas
and is a processor and recycler of the solid waste stream in Harvey
County, Kansas; and
2. WHEREAS , as a solid waste
collection and disposal services provider for a number of cities,
Harvey County is responsible for implementing diversion programs to
reduce the amount of solid waste from landfill disposal;
and
3. WHEREAS , Harvey County
currently employs many commercially available means to recover
material from the waste stream in order to provide diversion for
its customers who utilize the facility; and
4. WHEREAS , Harvey County is
continually exploring means to enhance recovery efforts, provide
additional diversion for its existing customers and provide
diversion opportunity for future customers; and
5. WHEREAS , BIFC is the owner of a
process, which recovers materials from the waste stream beyond the
recovery levels of traditional solid waste processing;
and
6. WHEREAS , BIFC has worked
closely with Harvey County to develop the viability of its recovery
process through engineering with the Engineer Procurement
Construction contractor, ICM, Inc., for the facility on Harvey
County’s property; and
7. WHEREAS , BIFC is seeking a
location for its first commercially viable facility that can
receive, process, and recover valuable by-products in the form of
fuels and energy from the residuals solid waste stream and any
other waste desired for disposal by Harvey County; and
8. WHEREAS , Harvey County desires
to engage BIFC’s services on the terms and conditions set
forth herein; and
9. WHEREAS , BIFC desires to
process solid waste stream received from Harvey County and is
willing to do so on the terms and conditions set forth herein;
and
NOW, THEREFORE , for and in consideration of the mutual
covenants and agreements of the parties as provided herein, it is
agreed between BIFC and Harvey County as follows:
SECTION 1.
HARVEY COUNTY REPRESENTS THAT: Harvey County is organized and exists as a
municipal subdivision under the laws of the State of Kansas, and is
duly qualified and authorized to carry on the functions and
operations as stated in this Agreement. Harvey County has the
power, authority, and legal right to enter into and perform this
Agreement, and the execution, delivery, and performance hereof by
Harvey County, (i) has been duly authorized, and
(ii) does not result in any material violation of any
judgment, order, law, or regulation applicable to Harvey County.
This Agreement has been duly entered into by Harvey County and
constitutes a legal, valid, and binding obligation of Harvey
County, enforceable in accordance with its terms. No public
official of Harvey County has either a direct or indirect financial
interest in this Agreement, nor will any public official of Harvey
County either directly or indirectly benefit financially from this
Agreement.
SECTION 2.
BIFC REPRESENTS THAT: BIFC is duly organized and existing as a
corporation under the laws of the State of Nevada, licensed to do
business in the State of Kansas with a current resident agent, and
has the requisite power and authority to enter into and perform its
obligations under this Agreement. In addition, the Kansas L.L.C.
called BioGold Fuels, L.L.C., which is wholly owned by BioGold
Fuels Corporation, is properly registered and licensed to do
business in Kansas. BIFC has the power, authority, and legal right
to enter into and perform this Agreement, and the execution,
delivery, and performance hereof by BIFC, (i) has been duly
authorized, and (ii) will not result in any material violation
of any judgment, order, law, or regulation applicable to BIFC
and/or any provisions of BIFC’s articles of incorporation or
bylaws. BIFC holds, or is expressly authorized under the necessary
patent rights, franchises, licenses, or comparable agreements, to
use such patent rights, franchises, licenses, or comparable
agreements in operating the resource recovery facility.
SECTION 3.
DEFINITIONS: When used in
this Agreement, the terms listed below shall have the following
meaning:
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A.
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Ash Residue
—
the residue resulting
from the processing of waste or other materials.
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B.
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BIFC Facilities
—
means facilities managed
and operated by BIFC located on land leased by BIFC from Harvey
County.
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C.
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Construction/Demolition
Waste — means solid waste resulting from the
construction, remodeling, repair and demolition of structures,
roads, sidewalks and utilities; untreated wood and untreated
sawdust from any source; treated wood from construction or
demolition projects; small amounts of municipal solid waste
generated by the consumption of food and drinks at construction or
demolition sites, including, but not limited to, cups, bags and
bottles; furniture and appliances from which ozone depleting
chlorofluorocarbons have been removed in accordance with the
provisions of the federal clean air act; solid waste consisting of
motor vehicle window glass; and solid waste consisting of
vegetation from land clearing and grubbing, utility maintenance,
and seasonal or storm-related cleanup. Such wastes include, but are
not limited to, bricks, concrete and other masonry materials,
roofing materials, soil, rock, wood, wood products, wall or floor
coverings, plaster, drywall, plumbing fixtures, electrical wiring,
electrical components containing no hazardous materials,
nonasbestos insulation and construction related packaging.
“Construction and demolition waste” shall not include
waste material containing friable asbestos, garbage, furniture and
appliances from which ozone depleting chlorofluorocarbons have not
been removed in accordance with the provisions of the federal clean
air act, electrical equipment containing hazardous materials,
tires, drums and containers even though such wastes resulted from
construction and demolition activities. Clean rubble that is mixed
with other construction and demolition waste during demolition or
transportation shall be considered to be construction and
demolition waste.
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D.
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Construction and demolition
landfill — means a permitted solid waste
disposal area used exclusively for the disposal on land of
construction and demolition wastes. This term shall not include a
site that is used exclusively for the disposal of clean
rubble.
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E.
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Generator
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means any person who
produces or brings into existence solid waste.
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F.
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Hazardous Wastes
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means any waste or
combination of wastes which, because of its quantity, concentration
or physical, chemical, biological or infectious characteristics or
as otherwise determined by the secretary: (A) Causes or
significantly contributes to an increase in mortality or an
increase in serious irreversible or incapacitating reversible
illness; or (B) poses a substantial present or potential
hazard to human health or the environment when improperly treated,
stored, transported or disposed of or otherwise managed.
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Hazardous waste shall not include:
(A) Household waste; (B) agricultural waste returned to
the soil as fertilizer; (C) mining waste and overburden from
the extraction, beneficiation and processing of ores and minerals,
if returned to the mine site; (D) drilling fluids, produced
waters and other wastes associated with the exploration,
development and production of crude oil, natural gas or geothermal
energy; (E) fly ash, bottom ash, slag and flue gas emission
control wastes generated primarily from the combustion of coal or
other fossil fuels; (F) cement kiln dust; or
(G) materials listed in 40 C.F.R. § 261.4, as in effect
on July 1, 1983, or any later version as established in rules
and regulations adopted by the secretary.
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G.
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Nonhazardous Special
Waste — means any solid waste designated by
the secretary as requiring extraordinary handling in a solid waste
disposal area.
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H.
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Person — means individual,
partnership, firm, trust, company, association, corporation,
individual or individuals having controlling or majority interest
in a corporation, institution, political subdivision, state agency
or federal department or agency.
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I.
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Recyclables
—
means any materials
that will be used or reused, or prepared for use or reuse, as an
ingredient in an industrial process to make a product, or as an
effective substitute for a commercial product.
“Recyclables” includes, but is not limited to, paper,
glass, plastic, municipal water treatment residues, as defined by
K.S.A. 65-163 and amendments thereto, and metal, but does not
include yard waste.
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J.
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Secretary
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means the Kansas
Secretary of Health and Environment.
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K.
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Solid Waste
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means garbage, refuse,
waste tires as defined by K.S.A. 65-3424, and amendments thereto,
and other discarded materials, including, but not limited to,
solid, semisolid, sludges, liquid and contained gaseous waste
materials resulting from industrial, commercial, agricultural and
domestic activities. Solid waste does not include hazardous wastes
as defined by subsection (f) of K.S.A. 65-3430, and amendments
thereto, recyclables or the waste of domestic animals as described
by subsection (a)(1) of K.S.A. 65-3409, and amendments
thereto.
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L.
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Start-Up
—
the systematic checkout
of facility equipment and systems, such that the Resource Recovery
System Facility is ready and able to commence and, in fact,
commences the processing of waste.
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M.
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Small Quantity Generator
Nonhazardous Waste — means any person who meets both of
the following conditions: (1) Generates in any single calendar
month less than 25 kilograms (55 pounds) of hazardous waste; and
(2) meets the conditions of a Kansas generator listed in
paragraphs (d)(2) through (d)(6) of KAR 28-31-02.
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SECTION 4.
TERM OF AGREEMENT:
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A.
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The
term of this Agreement shall be thirty (30) years with one ten
(10) year option exercisable by BIFC with ninety
(90) days advanced notice to Harvey County, which option, if
exercised, will be upon the same terms and conditions as the
original Agreement. In addition, there shall be three
(3) additional extensions of ten (10) years each, which said
additional ten (10) year extensions are exercisable only by
MUTUAL agreement of the parties, for a total potential term
of seventy (70) years.
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B.
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It
is agreed by the parties that BIFC will have nine (9) months
from the signing of this Agreement to start construction of the
Resource Recovery System Facility, as described herein. And BIFC
will have a total of twenty-seven (27) months after the
signing of this Agreement to commence “start-up” of the
Resource Recovery System Facility. Upon “start-up”,
BIFC shall commence the operational responsibilities set forth in
Sections 8 A and B.
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i.
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If
BIFC fails to start construction or fails to initiate
“start-up” within the time limits described above, or
fails to commence operational responsibilities as set forth in
Sections 8 A and B, upon “start-up”, this
Agreement shall be null and void and possession of all of the
leased property, as described in Exhibit “A”, including
the existing Transfer Station and equipment as described in
Section 6 shall immediately be returned to Harvey
County.
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ii.
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Time is hereby the essence of this
Agreement.
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SECTION 5.
50,000 SQUARE FOOT RESOURCE RECOVERY SYSTEM FACILITY:
It is the obligation of and BIFC
agrees to construct an approximate 50,000 square foot facility, or
otherwise an adequate sized building(s), to perform its obligations
under this Agreement.
SECTION 6.
LEASE OF TRANSFER STATION AND REAL ESTATE:
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A.
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The
BIFC Resource Recovery System Facility is located on land owned by
Harvey County as outlined and identified in Exhibit
“A”, attached hereto, which Exhibit “A”
contains the general legal description.
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Harvey County agrees to lease the
real estate described above and identified in Exhibit
“A” to BIFC.
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Both parties hereto specifically agree that
during the term of this Agreement, the other shall have appropriate
ingress and egress and otherwise have access for purposes of
performing the duties under this Agreement and inspection and
access, including employee access, to the borrow pit and
other
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