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HomeMy WebLinkAboutWPO202000007 Agreement - Nutrient Credits 2021-06-26strya Conservation AGREEMENT FOR PURCHASE AND SALE OF NONPOINT NUTRIENT OFFSET CREDITS This Agreement for the Purchase and Sale of Nonpoint Nutrient Offset Credits (this "Agreement") is made this 26th day of June, 2021 (the "Effective Date"), between OSTRYA CONSERVATION, INC ("Seller") and HARK VINEYARDS ("Purchaser"). RECITALS A. Seller is the sponsor of an approved nonpoint nutrient offset generation bank entitled the Slate River Nutrient Bank (the `Bank") consisting of 103.45 acres, more or less, located near Maxeys Road in Buckingham County, Virginia. The Bank has been authorized by the Virginia Department of Environmental Quality ("VDEQ") to generate and transfer nonpoint source offsets in accordance with i) the Chesapeake Bay Watershed Nutrient Credit Exchange Program (VA Code 62.1-44.19:14 et seq), ii) the Virginia stormwater offset program (VA Code 10.1- 603.8:1), and iii) the Virginia Soil and Water Conservation Board's Guidance Document on Stormwater Nonpoint Nutrient Offsets approved on July 23, 2009 to those regulated entities qualifying for nutrient offsets. The Bank is approved to generate 339.28 pounds of nitrogen reduction and 101.37 pounds of phosphorous reduction within the James River Watershed. Operation, management and maintenance of the Bank are subject to the requirements of the Nonpoint Nutrient Offset Generation Certification, James - 045 approved by the VDEQ on January 14, 2019 and to the statutes, regulations and policies cited therein (collectively, the "Certification"). B. Purchaser has applied for a permit from VDEQ for approval from the Counly of Albemarle. (Permit No. WPO-2020-00007) with a site plan requirement to control 1.59 pounds of phosphorous each year. Purchaser proposes to offset the annual nutrient control requirement by purchasing 1.59 nonpoint source phosphorous credits / Nutrient Credits and the retirement of the associated ratio of nonpoint source nitrogen credits in the amount of 5.32 pounds (collectively, the "Nutrient Credits") from Seller. AGREEMENT NOW, THEREFORE, for and in consideration of the mutual premises and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Purchaser agree as follows: 1. Recitals. The foregoing Recitals are hereby incorporated into this Purchase Agreement as a matter of warranties and representation within Paragraph 4 of this Agreement and not mere recital. 2. Sale and Purchase. Seller agrees to sell, and Purchaser agrees to purchase, the Nutrient Credits from the Bank for the purchase price of fifteen thousand nine hundred and 00/100 dollars ( 15 900.00 (the "Purchase Price") and in accordance with the terms and conditions set forth in this Agreement. Slate River Nutrient Bank - Agreement for the Purchase and Sale of Nutrient Credits Page 1 of 9 strya Conservation 3. Payment of Purchase Price. Purchaser shall pay the Purchase Price to Seller at Closing (as hereinafter defined) in cash by either delivering to Seller a check made out to OSTRYA CONSERVATION, INC. or by making a wire transfer of immediately available federal funds to an account at a financial institution designated in writing by Seller. 4. Seller's Representation Warranties and Covenants. Seller hereby makes the following representations and warranties and covenants, and the warranties and representations in the Recitals, and Purchaser's right to enforce the same shall survive the Closing. a. Authorization, Execution and Delivery. This Agreement has been duly authorized, executed and delivered by all necessary action on the part of Seller, constitutes the binding agreement of Seller and is enforceable in accordance with its terms. b. Responsibility for Development and Maintenance. Seller covenants and agrees that it shall be solely responsible for the development and maintenance of the Nutrient Credits and the Bank in accordance with the requirements of the Certification and all other applicable laws and regulations. Purchaser shall have no obligation to perform any of the responsibilities of the Seller now or hereafter set forth by the DEQ regarding the development and maintenance of the Nutrient Credits or the Bank. C. Compliance with Laws. Seller is now in compliance and will comply with all applicable laws and regulations relating to the establishment and sale of the Nutrient Credits, the Bank, and the Certification. Seller has received no notice (and Seller is not otherwise aware of any concern) with regard to the Bank credits which questions or changes the validity, amount or transferability of the credits within I UC 02080204. d. Credit Availability. As of the date hereof and of Closing, Seller has and shall have the Nutrient Credits available for transfer to Purchaser and said credits shall be free and clear of liens or other encumbrance. 5. Purchaser's Representations and Warranties. Purchaser hereby makes the following representations and warranties and Seller's right to enforce the same shall survive Closing a. Authorizations, Execution and Delivery. This Agreement has been duly authorized, executed and delivered by all necessary action on the part of Purchaser, constitutes the valid and binding agreement of Purchaser and is enforceable in accordance with its terms. b. No Additional or Implied Representations. Except as otherwise expressly provided in Paragraph 4 and elsewhere in this Agreement and in the Closing documents to be delivered to Purchaser by Seller at Closing, Purchaser acknowledges and agrees that Seller has not made and does not make any additional representations or warranties, either express or, other than as expressly set forth in Paragraph implied, with respect to the Nutrient Credits, and in entering into this Agreement, Purchaser has not been induced by, and has not relied upon, any other or additional representations, warranties or statements, whether express or implied, made by the Seller or any agent, employee or other representative of the Seller, which are not expressly set forth herein. This Paragraph shall survive Closing and delivery of the Nutrient Credits. 6. Closing. Closing on the purchase and sale of the Nutrient Credits pursuant to this Agreement ("Closing") shall be held at a location mutually agreeable to Purchaser and Seller, at Slate River Nutrient Bank - Agreement for the Purchase and Sale of Nutrient Credits Page 2 of 9 strya Conservation a time and date to be agreed upon by the Parties, but not later than 5:00 p.m. on _26July 2021, unless Seller consents in writing to a later date. Seller's Deliveries. a. At Closing, Seller shall deliver to Purchaser a signed Bill of Sale and Affidavit substantially in the form of Exhibits A, and B attached hereto and incorporated herein by this reference, evidencing the sale to Purchaser of the Nutrient Credits from the Bank. b. Not more than fourteen (14) calendar days following the Closing, Seller shall deliver, or cause to be delivered, to Purchaser a copy of Seller's Ledger entry, or other documentation, recording the sale and conveyance of the Nutrient Credits to Purchaser as provided herein and debiting the Nutrient Credits sold to Purchaser against the outstanding Nutrient Credits in the Bank in accordance with the Nonpoint Nutrient Offset Generation Certification. 8. Closing Costs. Seller shall pay the cost of preparing the Bill of Sale and Affidavit, any taxes and costs associated with transfer of the Nutrient Credits, and Seller's attorney's fees. Purchaser shall pay Purchaser's attorney's fees. 9. Default. a. By Purchaser. If Purchaser defaults in performing any of Purchaser's obligations under this Agreement, and if such default continues for a period of ten (10) days after Seller has provided written notice to Purchaser of such default, Seller may terminate this Agreement by providing written notice to Purchaser whereupon this Agreement shall terminate and Purchaser and Seller shall have no further obligations hereunder. Seller agrees that it waives any and all other rights and remedies against Purchaser and all other claims for damages against Purchaser arising from Purchaser's default under the terms of this Agreement. b. By Seller. If Seller defaults in performing any of Seller's obligations under this Agreement, and if such default continues for a period of ten (10) days after Purchaser has provided written notice to Seller of such default, Purchaser's sole remedy shall be either to (i) terminate this Agreement by providing written notice thereof to Seller and receive a refund of any amounts paid to Seller, in which event neither party shall have any further rights or obligations hereunder, except as expressly provided herein, or (ii) seek specific performance of Seller's obligation to sell the Nutrient Credits to Purchaser, and recover from Seller (and be entitled to pursue an action to recover) the costs and expenses incurred by Purchaser in connection with such action, including reasonable attorney's fees and court costs. 10. Effect of Condemnation, Regulatory Action or Force Majeure. a. Condemnation. If the Bank property or any part thereof is taken prior to Closing pursuant to eminent domain proceedings, or if such proceedings are commenced prior to Closing, and as a result Seller determines that it will be unable to transfer the Nutrients Credits to Purchaser at Closing as specified in this Agreement, then Seller may terminate this Agreement Slate River Nutrient Bank - Agreement for the Purchase and Sale of Nutrient Credits Page 3 of 9 strya Conservation by providing written notice to Purchaser at any time prior to Closing, and neither party shall have any further rights or obligations hereunder, except as expressly provided herein. b. Regulatory Action. If Seller is unable to transfer the Nutrients Credits to Purchaser as provided in this Agreement because of the action or order of any municipality or regulatory agency, regardless of whether or not Seller has contested or challenged such action or order, Seller may terminate this Agreement by providing written notice to Purchaser at any time prior to Closing, and neither party shall have any further rights or obligations hereunder, except as expressly provided herein. If such inability to transfer the Nutrient Credits to Purchaser arises after closing, seller shall refund purchaser any amount paid to Seller. ii. If Purchaser is prevented by any municipality or regulatory agency from acquiring the Nutrients Credits from Seller as provided in this Agreement, or if Purchaser's nonpoint nutrient offset plan is not approved by any municipality or regulatory agency, Purchaser may terminate this Agreement by providing written notice to Seller at any time prior to Closing, and neither party shall have any further rights or obligation s hereunder, except as expressly provided herein. C. Force Majeure. If Seller is unable to transfer the Nutrient Credits to Purchaser as provided in this Agreement because of damage to or loss of the Bank property resulting from fire, flood, storm, drought or other natural disaster, or from any other cause that is not the fault of Seller and is beyond Seller's reasonable ability to prevent or control, Seller may terminate this Agreement by providing written notice to Purchaser at any time prior to Closing, and neither party shall have any further rights or obligations hereunder, except as expressly provided herein. If such inability to transfer the Nutrient Credits to Purchaser arises after closing, seller shall refund purchaser any amount paid to Seller. 11. Indemnification. a. Seller's Indemnification. Seller shall be solely responsible for compliance with the Nonpoint Nutrient Offset Generation Certification and with all statutes, regulations and requirements applicable to the operation, management and maintenance of the Bank, and for ensuring the payment of all taxes owed by the Bank or assessed against the Bank property (`Bank Regulatory Requirements"). Seller shall indemnify, defend and hold harmless Purchaser and Purchaser's successors and assigns from and against any loss, cost, liability, or expense, or action, order, investigation or proceeding initiated by any government agency and arising from or based upon Seller's failure to comply with any Bank Regulatory Requirement. Seller's duty to indemnify Purchaser under this Paragraph 11 shall survive Closing. b. Purchaser's Indemnification. Purchaser shall indemnify, defend and hold harmless Seller from and against any action, order, investigation or proceeding initiated by any government agency and arising from or based upon Purchaser's failure to comply with any permit, authorization or condition thereof relating to Purchaser's nonpoint nutrient offset plan or the Nutrient Credits from and after the date of Closing. Purchaser's duty to indemnify under this Paragraph 11 shall survive Closing. 12. Credit Not Real Estate. The sale and conveyance of the Nutrient Credits to Purchaser in accordance with this Agreement shall not constitute the conveyance or transfer of any right, Slate River Nutrient Bank - Agreement for the Purchase and Sale of Nutrient Credits Page 4 of 9 strya Conservation interest or ownership in real property or in the Bank, nor shall such sale and conveyance impose upon Purchaser any obligation, duty or liability arising from or incident to ownership of or interest in real property. Purchaser shall have no right of access to Bank property. 13. Miscellaneous. a. No Joint Venture, This Agreement is made solely for the purposes set forth herein and no joint venture, partnership or other relationship between Purchaser and Seller is created hereby. b. No Third -Party Beneficiary. This Agreement shall bind and inure to the benefit of the Parties hereto and their respective successors and authorized assigns. This Agreement does not create or convey any rights, benefits or interests on behalf of any other person. C. Assignment. This Agreement may be assigned by Purchaser prior to Closing to any entity controlling, controlled by or under common control with Purchaser with notice to but without the consent of Seller, and this Agreement may otherwise be assigned by either Purchaser or Seller only with the prior written consent of the other party, which consent shall not be unreasonably withheld, conditioned or delayed. Any assignee shall assume the rights and obligations of its assignor. d. Entire Agreement. This Agreement sets forth the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior negotiations and agreements, written or oral. Each provision contained in this Agreement shall be severable from all other provisions hereof and the invalidity of any such provision shall not affect the enforceability of the other provisions of this Agreement. This Agreement may be modified only by a written instrument duly executed by both Seller and Purchaser. e. Choice of Laws. This Agreement shall be construed, performed and enforced under the laws of the Commonwealth of Virginia. f. Counterparts. This Agreement may be executed in one or more counterparts by the Parties. All counterparts shall collectively constitute a single agreement. g. Notices. All notices shall be in writing and sent by hand, overnight delivery service or certified mail, return -receipt requested, to the following addresses: If to Seller: James Eaton Ostrya Conservation Inc. P.O. Box 153 Scottsville VA 24590 If to Purchaser: Hark Vineyards Aaron Hark, Owner 1465 Davis Shop Rd. Earlysville, VA 22936 Slate River Nutrient Bank - Agreement for the Purchase and Sale of Nutrient Credits Page 5 of 9 strya Conservation Notices shall be deemed received (i) if hand delivered, when received, (ii) if given by overnight delivery service, the first business day after being sent prepaid by such overnight delivery service, or (iv) if given by certified mail, return receipt requested, postage prepaid, two (2) days after posting with the United States Postal Service. Either party may change its address by notifying the other party in a manner described above. [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK; SIGNATURES APPEAR ON THE FOLLOWING PAGE] Slate River Nutrient Bank - Agreement for the Purchase and Sale of Nutrient Credits Page 6 of 9 strya Conservation IN WITNESS whereof, Seller and Purchaser have caused this Agreement to be executed on their behalf by their duly authorized representatives as of the date set forth on the first page hereof. SELLER: OSTRYA CONSERVATION, INC. a Virginia Corporation By: Name: fames M. Eaton Its: Director PURCHASER: HARK VINEYARDS By: ez-�' X1Z_ Name: Aaron Hark Its: Owner Exhibits Exhibit A - Bill of Sale Exhibit B - Affidavit Slate River Nutrient Bank - Agreement for the Purchase and Sale of Nutrient Credits Page 7 of 9 Exhibit A - Bill of Sale NUTRIENT CREDIT BILL OF SALE Nonpoint Nutrient Offset Credits BILL OF SALE, made as of IQ, n day of t4 2021 by OSTRYA CONSERVATION, INC ("Seller") and HARK VINEYARDS ("Purchaser"). WHEREAS, Seller and Purchaser have entered into that certain Agreement for Purchase and Sale of Nutrients Mitigation Credits, dated as of 26th day of June, 2021 (the "Purchase Agreement", the terms of which are incorporated herein by reference and made a part hereof), with respect to the sale by Seller and purchase by Purchaser of Compensatory Nutrient Mitigation Credits held in Seller's Nonpoint Nutrient Offset Bank in Buckingham County, Virginia. NOW THEREFORE, for and in consideration of the payment of the Purchase Price (as defined in the Purchase Agreement) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller hereby sells, transfers, assigns, conveys, delivers and sets over to Purchaser, its successors and assigns, Nutrient Credits (consisting of 1.59 pounds of nonpoint source phosphorus credits and the retirement of the associated ratio of nonpoint source nitrogen credits in the amount of 5.32 pounds) as such are described in the Purchase Agreement. TO HAVE AND TO HOLD all such Nutrient Credits hereby sold and transferred to Purchaser and its successors and assigns forever. IN WITNESS WHEREOF, Seller has caused this Bill of Sale to be executed by its duly authorized representative as of the date first above written. Purchaser: Hark Vineyards Project Name: Hark Vineyards Tastine Room Phosphorous Offsets: 1.59 Pounds Associated Nitrogen Offsets: 5.32 Pounds OSTRYA CONSERVATION, INC. a Virginia orporation - By: Nam . James K Eaton Its: Director Page 8 of 9 Exhibit B - Affidavit Ostrya Conservation, Inc. - Slate River Nutrient Bank Affidavit of Phosphorus Offset Sale OSTRYA CONSERVATION, INC., a Virginia corporation (the "Company"), hereby certifies the following: Pursuant to that certain Agreement for the Purchase and Sale of Nonpoint Nutrient Offset Credits dated 26th June. 2021 (the "Agreement"), between the Company (as "Seller") and HARK VINEYARDS. ('Purchaser"), the Company, for the benefit of the Purchaser, agreed to sell 1.59 pounds of phosphorus offset credits to the Purchaser and retire 5332-pounds of nitrogen offsets (representing the ratio of nitrogen offsets to the phosphorous offsets at the offset generating facility); 2. The Company and the Purchaser, as of the date hereof, have closed the transaction contemplated by the Agreement and the Company has sold, assigned, and conveyed to Purchaser phosphorus offset credits. WITNESS the following signature: OSTRYA CONSERVATION, INC., a Virgini corporation By: PI-7 zt��� Diref for Date: 7 �%3 r Sworn to and subscribed before me this +3 day of t.1 Eaton, Director, on behalf of Ostrya Conservation Inc., a Virginia co�pJ tont My commission expiresJo-nJ LJ 31 d013 Notary Purchaser: Hark Vineyards Project Name: Hark Vineyards Tasting Room Phosphorous Offsets: 1.59 pounds Associated Nitrogen Offsets: 5.32 pounds Project HUC: 02080204 Bank Sponsor HUC: 02080203 Project p: WPO-2020-00007 TMP: 00800-00-00-05000 County/Cityof Commonrrealth/State of VIA1 M I certify this to be a complete, full, ue and exact reproduction of the on wal documirit CertijiC� this day oi� Mrs Marie drwberg Notary Pu0c YA L:uaa wwom of V116h% wst,� My CommWm Expires January 51, 2023 r 100 7823651 1, by James M. 9of9 Notary Publi6-' 1 I Mycti missionexpirm 3 2023