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33 <br />PRELIMINARY TERM SHEET <br />LANDFILL GAS RIGHTS AGREEMENT <br />The following is a preliminary summary for discussion purposes only of certain terms and <br />conditions contemplated for the Agreement. <br />1. Parties <br />Orange County, North Carolina ("County") <br />University of North Carolina at Chapel Hill ("University") <br />2. Rights Granted to University <br />a) Right to use and access the Orange County Landfill, 1514 Eubanks Road, Chapel Hill <br />("Landfill") on a 24-hour 7-day per week basis to perform the operations contemplated by the <br />Agreement. <br />b) Exclusive right and license to explore for, mine, extract and collect the landfill gas <br />("LFG") <br />c) Easements and right-of--way through Landfill site and license to drill gas wells, lay <br />pipelines, construct tanks and other related LFG collection infrastructure ("LFG Collection <br />System") <br />d) Ownership of and title to all LFG and to the LFG Collection System <br />e) License to install utility lines to Landfill necessary for the LFG Collection System and <br />related operations <br />3. Representations Warranties and Obligations of County <br />a) County represents and warrants that its has fee simple title to the Landfill and has full <br />right to make and enter into the Agreement <br />b) County represents and warrants that no verbal or written assignment or agreement <br />currently exists for the extraction and sale of the LFG <br />c) County agrees to lnalce reasonable efforts to repair cracks, fissures, erosion, or other <br />physical changes in the Landfill which have an adverse effect on the production of LFG <br />d) County agrees to cooperate in the development and operation of Landfill so as to <br />maximize the production of LFG, and County shall not interfere with University's LFG <br />operations <br />e) County shall maintain adequate "cover" over Landfill at all times to meet current federal <br />and state guidelines <br />f) County shall cooperate with University in preparing, executing and filing such <br />applications, assignments of rights, and other documents as maybe necessary to allow <br />University to conduct the activities contemplated under the Agreement <br />g) County agrees to make available to University copies of all necessary environmental <br />information, reports, environmental impact reports, air impact assessment studies in the County's <br />possession <br />h) County shall take reasonable measures to ensure that the LFG Collection System is not <br />damaged by the County, its employees or contractors. In such event that the LFG Collection <br />System is damaged by the County, ,its employees or contractors, the County shall reimburse <br />University for the reasonable costs of repairs <br />i) County shall retain sole and exclusive right and all obligations with regard to its <br />municipal solid waste landfill operations at the Landfill. County shall continue to be responsible <br />{00016169.DOC} <br />Page 10 of 15 <br />