Breezy Hill Farm Leasing Opportunity

Transcription

1 Breezy Hill Farm Leasing Opportunity Lease offering Breezy Hill Farm is a 23-acre farm located in Homeworth, Ohio in Columbiana County. The farm was acquired by Phil and Mindy Bartholomae in the fall of 2008 and has been developed into a successful organic vegetable production facility. We currently do a business of around $120,000 in gross annual crop sales based primarily on vegetable production with minor contributions from cut flowers, organic hay, grass-raised poultry and fruit. We are supplying farmers markets, restaurants, and individuals in Akron, Canton, Cleveland, Kent, Youngstown, Pittsburgh and surrounding areas (see sales by customer summary report for details). We are looking to retire from farming but believe that we have built a robust and sustainable business and so we are looking for ambitious entrepreneurs to take over this business starting in the Fall of We can offer for leasing the following; Access to the field units 1 through 7 (see Aerial Diagram and the Field History attachment for details). These fields have been maintained using sustainable agricultural practices and have been certified Organic with OEFFA since 2012 (see OEFFA certificate #1968). Access to barns as described in the attached Facilities and Equipment spreadsheet Access to Breezeway including office, bathroom and handwashing station as described in attachment. Note that Breezeway is not a residence and operator will need to find their own residence. Access to nearly all the equipment and tools needed to operate a small organic farm (see attachment for detail listing of Facilities, Major Machinery, Small Tools and marketing supplies included in the lease) Access to High Tunnels 1-5 which have been used successfully for season extension since 2008 Access to customer base and markets (pending approval of market managers) Access to our employees who have considerable experience in the operations of Breezy Hill Farm (note actual terms and conditions of employment will be responsibility of Operator). Access to water, electricity and gas (on a limited basis) needed to operate the farm Access to our experience and expertise on organic vegetable production. Note that we are here to mentor, assist and advise, but operator should expect full-time access or that we will be working members of the farm team. Landowner will retain the Breezy Hill Farm name and brand. Operator will be required to develop their own name and brand and would be expected to form a corporate entity under that name. Areas within the farm that are not accessible to the operator unless permission is granted in advance by the Landowner include: The house we will be living there. The Workshop (located in the former milking parlor of the dairy barn and adjacent to the Washing Room. Since we will be living at the farm, we expect that operators operations will respect our privacy and lifestyle. Operator should restrict working hours between 7am to 6pm unless permission for later hours are agreed in advanced with the landowner.

2 Landowner will be responsible for routine maintenance of equipment and facilities. Operator will be responsible for repairs/replacement due to breakage or mishandling of equipment. Landowner will maintain land outside of the field units. This would include mowing and maintenance of the yard and connecting areas. Operator should keep the field units and surrounding areas in a neat and orderly fashion. Operator is responsible for managing weeds, field waste and other debris. The farm includes a composting station that can accept weeds, manures and organic wastes. Operator is responsible for managing this composting station in accordance with best practices (see USDA NOS on composting). Plastic mulch and other waste plastic must be removed from the farm (our County Extension Service has a farm plastic recycling service). Operator should return all field units, facilities and equipment in roughly the same condition as received. Normal wear and tear is expected but equipment amd/or facility that has been damaged due to operator s activity must be repaired or replaced at operator s cost. Operator may decide to change use of the designated fields. For example, if operator is looking to expand on the acreage for vegetable cultivation there is plenty of space in Field 5 to accommodate expansion. Operator should discuss plans for these changes and obtain approval from Landowner prior to changing. Continued organic certification is preferred but not required. The Operator is expected to adopt sustainable agricultural practices as defined in the USDA Organic regulations. Operator must request in advance permission to use chemicals for agricultural that are not on the Organic Materials Register (OMRI) approved list. While we understand that use of non-omri approved chemicals made be warranted to temporarily correct certain pest, fungal or disease issues; we will not approve the routine or widespread use of non-organic chemicals. For example; extensive use of Glyphosate to kill weeds on fields 5,6 or 7 would not be approved. We have provided our sales history to give the operator some perspective on the potential for income generated from the farm. We do not however provide and guarantee that the operator will achieve the same returns on their operations. While we will provide access to our customer base we provide no guarantees of their allegiance to the new farm operation. Participation in farmers market is competitive and vendors are selected based on their application each year. Therefore, we cannot provide guarantees with regards to being accepted as a vendor in the same markets that we have participated in. Operating Expenses: All expenses for the operation of the farm will be paid for by the operator. These would include (but are not limited to). Soil Amendments and Chemicals Purchased Feed Purchased Fertilizers and Lime Gasoline, Fuel and Oil Market Fees Marketing Expenses Repairs and Maintenance Seeds and Plants Purchased Insurance Expense including workman s compensation for employees, Farmers Market Liability Insurance, and insurance for damages, injuries or accidents caused by operator s operation (get details of what is needed)

3 Payroll for employees Computer and Internet Expenses Advertising and Promotion Small Tools and Equipment High Tunnel plastic has a limited life (usually 4 years) and replacement of high tunnel plastic is considered an operating expense and would be paid for by the operator. Terms and Conditions of the lease will be determined as we have the chance to review operator candidates and their proposed operations. A sample lease is provided as a framework only. Contact Information Phil and Mindy Bartholomae Breezy Hill Farm Bowman Road, Homeworth, OH (216) Phil.breezyhill@gmail.com Check us out on Facebook as Breezy Hill Farm Ohio We encourage you to come to the farm for a tour. We will have Open House to view the farm on August 8 th and 15 th. If you are unable to make either of these dates, please call to arrange an appointment. What we need from you A detailed description of your farm operation Plans for use and activity for each field unit and facilities Your business plan for the proposed farming operation detailing the operation, the expenses and anticipated income. List of employees or workers who will be accessing the property Your experience related to the proposed farming operation 3 professional references Permission to conduct credit and background check Your proposal including the items listed above are expected by, September 1 st, We will make a decision by October 1 st 2016

4 Photos of the Farm View from East with High Tunnels 1,2,3 and 4. Apple orchard and part of Field 5 in foreground Field #1

5 High Tunnel #3 in Spring Production Field #1 with High Tunnels # 3,4 and 5 in background

6 Breezy Hill Farm Sample Lease This lease agreement is made this day of 2016, between OPERATOR(S): Address: Telephone OWNER(S): Phil and Mindy Bartholomae owners of Breezy Hill Farm of Ohio, LLC Address: Bowman Road, Homeworth, OH Telephone ( ) phil.breezyhill@gmail.com THE PARTIES AGREE AS FOLLOWS: 1. DESCRIPTION OF FARM. The Owner, in consideration of the terms specified herein, leases to the Operator for agricultural purposes the following legally described property. a. Breezy Hill Farm is a 23-acre farm located in Homeworth, Ohio in Columbiana County. The farm was acquired by Phil and Mindy Bartholomae in the fall of 2008 and has been developed into a successful organic vegetable production facility. We currently do a business of around $120,000 in gross annual crop sales based primarily on vegetable production with minor contributions from cut flowers, organic hay, grass-raised poultry and fruit. We are supplying farmers markets, restaurants, and individuals in Akron, Canton, Cleveland, Kent, Youngstown, Pittsburgh and surrounding areas (see sales by customer summary report for details). b. We are looking to retire from farming but believe that we have built a robust and sustainable business and so we are looking for ambitious entrepreneurs to take over this business starting in the Fall of We can offer for leasing the following; i. Access to the field units 1 through 7 (see Aerial Diagram and the Field History attachment for details). These fields have been maintained using sustainable agricultural practices and have been certified Organic with OEFFA since 2012 (see OEFFA certificate #1968). ii. Access to barns as described in the attached Facilities and Equipment spreadsheet iii. Access to Breezeway including office, bathroom and handwashing station as described in attachment. Note that Breezeway is not a residence and farmer will need to find their own residence. iv. Access to nearly all the equipment and tools needed to operate a small organic farm (see attachment for detail listing of Facilities, Major Machinery, Small Tools and marketing supplies included in the lease) v. Access to High Tunnels 1-5 which have been used successfully for season extension since 2008 vi. Access to customer base and markets (pending approval of market managers)

7 vii. Access to our employees who have considerable experience in the operations of Breezy Hill Farm (note actual terms and conditions of employment will be responsibility of Farmer). viii. Access to water, electricity and gas (on a limited basis) needed to operate the farm ix. Access to our experience and expertise on organic vegetable production. Note that we are here to mentor, assist and advise, but farmer should expect fulltime access or that we will be working members of the farm team. 2. TERM OF LEASE. The term of this lease shall be for the period of year(s) TBD beginning, and ending and continuing thereafter from year to year, unless either party gives notice to the other as specified by Ohio law on or before, of the final lease year, to become effective the following March 1. Termination of the lease by either party is possible. Notice of termination must be provided XX days in advance. 3. PURPOSES OF THE LEASE. The Operator shall have the right to use the property for the production of crops and livestock subject to the following limitations: Landowner will retain the Breezy Hill Farm name and brand. Farmer will be required to develop their own name and brand and would be expected to form a corporate entity under that name. Areas within the farm that are not accessible to the farmer unless permission is granted in advance by the Landowner include: o The house we will be living there. o The Workshop (located in the former milking parlor of the dairy barn and adjacent to the Washing Room. Since we will be living at the farm, we expect that farmers operations will respect our privacy and lifestyle. Farmer should restrict working hours between 7am to 6pm unless permission for later hours are agreed in advanced with the landowner. Landowner will be responsible for routine maintenance of equipment and facilities. Farmer will be responsible for repairs/replacement due to breakage or mishandling of equipment. Landowner will maintain land outside of the field units. This would include mowing and maintenance of the yard and connecting areas. In the event of damage or destruction of buildings or structures listed above, not caused by the operator, the Owner will have the option to replace them or provide their functional equivalent to the Operator for the purposes described above within a reasonable period of time, or make adjustment to the terms of this lease in lieu of replacement. 4. CASH RENT The Operator agrees to pay the Owner cash rent for the use of part or all of the Real Estate as follows: Total annual rent $ TBD

8 The cash rent shall be due and payable in monthly installments on the first day of the month. In the event the cash rent is not paid in full by the due date(s), the Operator agrees to pay interest on the amount of unpaid rent at the rate of % annual percentage rate (APR) from the due date until paid. All cash rent is to be mailed or delivered to the Owner at the address listed above. 5. FLEXIBLE CASH RENT (optional). The amount of cash rent to be paid by the Operator to the Owner for the Real Estate could be reduced and tied to the monthly gross sales of the operator. (a) Percent of Gross Revenue: Actual gross revenue from all crops/livestock Gross revenue will equal actual yield x actual price. % of gross sales to be determined 6. OPERATOR DUTIES AND CONDITIONS. Operator agrees to: a. Prepare the land and plant such crops as agreed on in a timely fashion, as weather conditions permit. b. Manage carefully all growing crops and to harvest all crops in a timely fashion as weather permits. In the event Operator fails to do so, Owner reserves the right, personally or through designated agents, to enter upon the Real Estate and properly care for and harvest all growing crops, charging the cost of the care and harvest to the Operator. In the case of termination of this agreement, the Operator shall not perform any fall tillage nor incur any other expense for the Owner for the following year s crop without prior written consent of the Owner. c. Initial crop plan will be provided prior to signing of this lease. In subsequent years, operator will submit to the Owner by December 15 an annual report including 1) a summary of fertilizer, lime, and pesticide application records 2) production or yield information about harvested crops each year and 3] a crop plan for the following year. d. Do what is reasonably necessary to control soil erosion including, but not limited to, providing labor and normal farm equipment for the maintenance of existing watercourses, waterways, ditches, drainage areas, terraces and tile drains, and abstaining from any practice which will cause damage to the Real Estate. The Operator s responsibility does not include major reconstruction of such improvements made necessary by normal wear and tear or other natural causes. e. Investigate broken and inoperative tile lines and report them to the Owner. Labor for minor repairs to broken tile, tile inlets, and tile outlets shall be the responsibility of the owner and the cost of materials for their repair shall be paid by the owner. f. Follow a mutually acceptable tillage program for each of the crops planted. Such plan shall meet soil conservation and surface residue requirements as prescribed by

9 the Natural Resources and Conservation Service (NRCS) conservation plan and include the following additional crop management practices. g. At least every 4 years, conduct soil tests and provide copies of all soil test results to the Owner as follows: m. Provide labor at no charge to repair preexisting buildings and fences damaged by normal wear and tear when materials are furnished by Owner. Operator will provide labor and will furnish all materials to repair preexisting buildings damaged by Operator s livestock or through Operator s negligence. Owner shall provide all necessary materials and skilled labor for major rehabilitation, repairs, or replacement as deemed necessary by the Owner. n. Comply with all local, state, and federal laws and regulations governing all activities related to; personal conduct on the property, the application of pesticides, livestock manure and commercial fertilizers, and the cultivation of crops. Follow label directions in the handling and application of all chemicals used on the Real Estate, and follow all applicator s licensing requirements. Comply with local, state, and federal laws and regulations pertaining to groundwater contamination, manure disposal, and hazardous waste storage or disposal. o. Not allow any recreational use, including hunting, of the Real Estate without written consent of the Owner. p. Operator should keep the field units and surrounding areas in a neat and orderly fashion. Operator is responsible for managing weeds, field waste and other debris. The farm includes a composting station that can accept weeds, manures and organic wastes. Operator is responsible for managing this composting station in accordance with best practices (see USDA NOS on composting). Plastic mulch and other waste plastic must be removed from the farm (our County Extension Service has a farm plastic recycling service). q. Operator should return all field units, facilities and equipment in roughly the same condition as received. Normal wear and tear is expected but and equipment of facility that has been damaged due to operator s activity must be repaired or replaced at operator s cost. r. Operator may decide to change use of the designated fields with mutual agreement and written approval by owner.. For example, if operator is looking to expand on the acreage for vegetable cultivation there is plenty of space in Field 5 to accommodate expansion. Operator should discuss plans for these changes and obtain approval from Landowner prior to changing. s. Continued organic certification is preferred but not required. The Operator is expected to adopt sustainable agricultural practices as defined in the USDA Organic regulations. Operator must request in advance permission to use chemicals for agricultural that are not on the Organic Materials Register (OMRI) approved list. While we understand that use of non-omri approved chemicals made be warranted to temporarily correct certain pest, fungal or disease issues; we will not approve the routine or widespread use of non-

10 organic chemicals. For example; extensive use of Glyphosate to kill weeds on fields 5,6 or 7 would not be approved. 8. EXPENSES. All materials and services related to the production of agricultural products shall be acquired and paid for by the Operator. These would include (but are not limited to). Soil Amendments and Chemicals Purchased Feed Purchased Fertilizers and Lime Gasoline, Fuel and Oil Market Fees Marketing Expenses Repairs and Maintenance Seeds and Plants Purchased Insurance Expense including workman s compensation for employees, Farmers Market Liability Insurance, and insurance for damages, injuries or accidents caused by operator s operation (get details of what is needed) Payroll for employees Computer and Internet Expenses Advertising and Promotion Small Tools and Equipment High Tunnel plastic has a limited life (usually 4 years) and replacement of high tunnel plastic is considered an operating expense and would be paid for by the operator. 9. COMPENSATION FOR IMPROVEMENTS. The Operator may make improvements to buildings, fences, or water systems and other items at the Operator s own expense and consistent with the terms of the lease, provided consent of the Owner has been given and provided these improvements shall not be removed when the Operator leaves the farm unless otherwise negotiated and approved by the owner. 10. REAL ESTATE AND PERSONAL PROPERTY TAXES. The Owner agrees to pay all taxes, assessments, or other public charges levied or assessed by lawful authority against the Real Estate. The Operator agrees to pay all personal property taxes, assessments, or other public charges levied or assessed by lawful authority against the Operator s personal property on the premises, during the term of the lease. 10. PARTICIPATION IN GOVERNMENT PROGRAMS. The participation in any offered program of the United States Department of Agriculture or other federal, state, or county government agencies for crop production control, soil and water conservation, disaster assistance, price or revenue support, or other purposes will be discussed and decided on an annual basis or when the original contract expires. The course of action agreed upon shall be placed in writing and signed by both parties. A copy of the course of action so agreed upon shall be made available to each party.

11 11. REMOVAL OF PORTABLE EQUIPMENT AND BUILDINGS. The Owner shall not be responsible for property owned by the Operator. The Operator shall have the right to remove from the farm any portable equipment or buildings which the Operator has placed upon the farm at the Operator s expense. Such removal must be done within days following the termination of the lease, unless additional time is granted in writing. If such property is not removed, it shall be considered abandoned and Operator shall claim no further interest in it except by written agreement between the Owner and the Operator. 13. WELL AND WATER SYSTEMS. Owner agrees to repair and replacement of wells, water lines, well pumps, septic tanks and related equipment. There is a single well on the property that we have used for both residential and agricultural. The well capacity has been sufficient to supply both needs over the last 8 years. Operator shall use water conservation methods (e.g. drip irrigation) to ensure that well is not over worked. In the event that well is unable to supply both residential and agricultural use; operator will be required to use the pond for irrigation at the operator s expense. 14. Gas Well we have a natural gas well that is the sole source of heating gas for both residential and agricultural buildings. The well has limited capacity in terms of flow and pressure and is not very reliable in cold weather. Operator should not assume that heating the high tunnels is possible. The limited gas resource can be used to ensure the seedling room and propagation tunnel can be heated during critical times. Note: we will need to work out how to mutually conserve and use the limited gas resources. 16. INSURANCE. Both the Operator and Owner will keep their respective property interests reasonably insured against hazards and casualties. In the event of any damage to crops, buildings, or improvements by any natural or man-made disaster, the Operator shall inform the Owner with 48 hours. The Operator shall carry the following types and minimum coverage of insurance: a. Workers Compensation Insurance (if applicable). b. Comprehensive General Liability with limits of not less than $ million. c. Automobile Liability Insurance on all owned, non-owned, hired, or leased automotive equipment in conjunction with operations in amounts not less than $ for bodily injury and $ for property damage and liability. d. If on-farm sales are continued operator will be required to carry insurance coverage for any damages or injuries caused by customers coming on the farm. 17. RIGHT OF ENTRY AND INSPECTION. The Owner may enter the real estate at any reasonable time for the purpose of consulting with the Operator, viewing the property, making repairs or improvements, or for other reasonable purposes that do not interfere with the Operator s ability to carry out regular farming operations. Upon properly served notice of termination of the lease and permission of the Operator (provided that such permission shall not be unreasonably withheld), the Owner reserves the right to enter the Real Estate and perform fall tillage, seeding, fertilizing or other customary seasonal operations after the Operator has completed the harvesting of crops. 18. TRANSFER OF INTEREST. The Operator agrees not to lease or sublet any part of the Real Estate nor assign this lease to any other person or entity, nor sublease any or all of the property described herein without prior written permission of the Owner. This lease shall be

12 binding upon the heirs, assignees, or successors in interest of both parties. If the Owner should sell or otherwise transfer title to the Real Estate, the Owner will do so subject to the provisions of this lease. 19. CHANGES IN LEASE TERMS. The conduct, representation, or statement of either party, by act or omission, shall not be construed as a material alteration of this lease until such provision is reduced to writing and executed by both parties as an addendum to this lease. 20. ARBITRATION. Any disputes between the Owner and Operator not covered by the terms of this lease may be submitted by either party for arbitration by three disinterested persons, one of whom shall be selected by the Owner, one by the Operator, and a third by the previously named two. If, and when, disputes are submitted, a majority decision of the arbitrators shall be binding upon the parties to the lease. 21. ATTORNEY FEES AND COURT COSTS. In the event a judgment is granted to either party as a result of legal action related to the terms of this lease, the payment and discharge of all costs and attorney fees or other expenses incurred to enforce the terms of this lease shall be handled as follows (check appropriate statement): Each party shall pay its own attorney fees, legal expenses, and other costs. If the Operator is awarded a judgment against the Owner, the Owner shall pay all attorney fees and legal expenses. If the Owner is awarded a judgment against the Operator, the Operator shall pay all attorney fees and legal expenses. 23. CONTRACT CONSTRUCTION. Words or phrases herein, including acknowledgment, are construed as in the singular or plural and as the appropriate gender, according to the context. 24. NOTICES. Any notice contemplated in this lease shall be made in writing and shall either be delivered in person (with signed acknowledgment of receipt from the intended recipient), or be mailed by certified U.S. mail, return receipt requested, to the last known mailing address. The notice provisions of this section shall not apply to the notice of termination as set forth in Section 2 of this lease agreement. 25. INDEMNIFICATION. The Operator shall take possession of the premises subject to the usual hazards of operating a farm and assume all of the risks of accidents to the Operator and the Operator s family or agents, in pursuance of the farming operation, and in performing repairs or improvements or other actions pursuant to this lease. The Operator agrees to indemnify, defend, and hold harmless the Owner against any liability and/or pay for any and all damages, losses, or expenses incurred by the Owner in connection with leased premises, beyond that covered by insurance due to Operator s negligence or failure to perform the terms of this lease. The Owner agrees to disclose in writing to the Operator the existence of all known wells, underground storage tanks, hazardous waste sites, and solid waste disposal sites on the Real Estate. These include: 26. MINERAL RIGHTS. The Owner reserves all rights to any minerals on or underlying the farm. 27. YIELDING POSSESSION. The Operator agrees that on termination of the lease, the Operator will yield possession to the Owner without further demand or notice. The premises shall be

13 in as good order and condition as when same were entered by the Operator. Loss by fire, tornado or other forces beyond Operator s control and ordinary wear and tear are excepted. If the Operator wrongfully withholds possession of the premises after the date of termination, the Operator shall pay to the Owner $ for each day the Operator remains in possession thereafter as liquidated damages. 28. NO PARTNERSHIP. It is understood and agreed that this lease shall not be deemed to be nor intended to give rise to a partnership relation. 29. SIGNATURES. We agree to the terms and conditions of this lease. Operator (SIGNATURE) Owner (SIGNATURE) Operator (PRINT NAME) Owner (PRINT NAME) Date Date Operator (SIGNATURE) Owner (SIGNATURE) Operator (PRINT NAME) Owner (PRINT NAME) Date Date For (BUSINESS ENTITY) By (OWNER S REPRESENTATIVE) Address Address Telephone Telephone Optional Notarization (OPERATOR) STATE OF, COUNTY OF This record was acknowledged before me this day of,, by Signature of Notary Public. Optional Notarization (OWNER)

14 STATE OF, COUNTY OF This record was acknowledged before me this day of,, by Signature of Notary Public.