Wind Energy Leases Kansas Wind & Renewable Energy Conference September 24, 2008 Mark Lawlor Horizon Wind Energy.

Wind Energy LeasesKansas Wind & Renewable Energy ConferenceSeptember 24, 2008

Mark LawlorHorizon Wind Energy

Who We AreHorizon Wind Energy develops, constructs, owns and operates wind farms throughout the U.S.

Originally Zilkha Renewable Energy. Acquired by Goldman Sachs in 2005 and renamed Horizon Wind Energy. Acquired by Energias de Portugal (EDP) in 2007.

Headquartered in Houston with regional offices in New York, Oregon, California, Oklahoma, Colorado, Minnesota and Illinois

Over 200 employees

Have developed more than 2000 MW of operating wind farms, and own over 1300MW

What Weve DoneTierras Morenas24 MW, Costa RicaBlue Canyon Wind Farm225 MW, near Lawton OKTop of Iowa Wind Farm80 MW, Worth County IowaMaple Ridge Wind Farm322 MW, Lewis County NYLone Star400 MW, Shackelford County TXTwin Groves396 MW, McLean County ILElkhorn Valley100 MW, Union County WAPrairie Star100 MW, Mower County MN

The Wind Energy LeaseCommon Elements

EasementsEasements (run with the land)Capture windAccess: roads, crane travel path, distributionConstruction

The Wind Energy LeaseTerm:Option/Development TermAllows developer to conduct due diligenceExtended/Operational TermDriven by PPA, market, economics, transmissionRent:Royalty on Gross RevenueNameplate Schedule* A note on the Kansas Market

The Wind Energy LeaseCommon Wind Company Covenants:Keep roads in good repairKeep land free of liensPay taxesKeep project in state of good repairLandowner Covenants: (based on landowners actual knowledge)AuthorityFree of bankruptcy, pending litigation, judgmentsHazardous materialUnrecorded agreementsNo interferenceHunting

The Wind Energy LeaseAssignment, Subleasing & Mortgaging:Limited area of negotiationWind company must be able to assign, sublease, grant a subeasement or license in or transfer any portion of the lease to third partiesDefault & RemediesNotice, cure, remedies under law

The Wind Energy LeaseRestoration/Decommissioning:TurbinesFoundationRestoration FundSuperseded by governmental permit fundFall back: scrap value

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