STATE OF NEW MEXICO

STATE OF NEW MEXICO COMMISSIONER OF PUBLIC LANDS GRANT OF RIGHT-OF-WAY Right-of-Way ?swirl:tent No. RW-30137 This indenture, made this (S day of 2006 by and between the State of New Mexico, acting by and through its Commissioner of blic Lands, "Grantor", Zorro Trust whose address is 457 Madison Ave.. New York. NY 10022 Grantee; WITNESSETB: That Grantor, for and in consideration of the sum of $12.969.00 Twelve Thousand Nine Hundred Sixty Nine Dollars and 00/100 -cash in hand, receipt of which is hereby acknowledged, and other good and valuable consideration, hereby conveys to grantee a right-of-way for the sole and exclusive purpose of water pipeline including the right to enter upon the real estate hereinafter described at any time that it may see fit to construct, maintain and repair the structures upon the right-of-way, together with the right to remove trees, brush, undergrowth, and other obstructions interfering with the location, construction, and maintenance of said right-of-way. The right-of-way hereby granted coven a strip of lantafeet in width in Lea County (ies), as more particularly described by the attached centerline description and survey plats, which are incorporated herein. This grant is made upon the following express terms and conditions: . This right-of-way is granted for a term of 35 years. The grant may be renewed for additional periods upon application to Grantor. Any such renewals are subject to such terms and conditions as the Grantor may require, and payment of compensation. 2. Grantor reserves the right to authorize or grant rights-of-way or other easements to third parties, which may be parallel to, cross over or bisect this right-of-way. In such cases, the subsequent grantee may, at the discretion of the Grantor, be required to post a bond guaranteeing payment for damages to the installations and improvements of Grantee herein. In crossing any right-of-way for a highway, road, telephone, telegraph, transmission line, etc. Grantee herein will exercise due care so as not to interfere with said rights-of-way and will comply with all applicable laws, rules, and regulations in connection with the making of such crossings 3. The right to grant additional rights-of-way or easements within this right-of-way belongs exclusively to Grantor. Grantor hereby agrees, however, that in the event Grantor elects to exercise such right and if Grantee herein is the New Mexico State Highway and Transportation Department, Grantor will secure in writing the agreement of subsequent right-of-way grantee that no facilities will be constructed or installed within the right-of-way subsequently granted without first obtaining from the Department a permit prescribing the conditions under which facilities may be placed within such right-of-way in accordance with the Department's applicable rules and regulations. GRANTEE EXPRESSLY AGREES THAT PRIOR TO THE CONSTRUCTION OR INSTALLATION OF ANY FACILITIES WITHIN THE RIGHT-OF-WAY GRANTED HEREIN, GRANTEE WILL DETERMINE WHETHER THE RIGHT-OF-WAY IS WITHIN A PREVIOUSLY S-25 (Revised 01/03/2000) EFTA00315624 (2) Right-of-Way Easement No. RW-30137 ESTABLISHED NEW MEXICO STATE HIGHWAY AND TRANSPORTATION DEPARTMENT RIGHT- OF-WAY, AND IF IT IS, GRANTEE WILL OBTAIN FROM THE DEPARTMENT A PERMIT THAT PRESCRIBES THE CONDITIONS UNDER WHICH FACILITIES MAY BE PLACED WITHIN THE RIGHT-OF-WAY IN ACCORDANCE WITH THE DEPARTMENT'S APPLICABLE RULES AND REGULATIONS. GRANTEE FURTHER UNDERSTANDS AND AGREES THAT THE FAILURE TO OBTAIN SUCH PERMIT SHALL RESULT IN THE FORCIBLE REMOVAL BY THE DEPARTMENT OF ANY FACILITIES THAT MAY BE CONSTRUCleD OR INSTALLED WITHIN THE RIGHT-OF-WAY. 4. In clearing the right-of-way, Grantee agrees to dispose of brush and other debris so as not to interfere with the movement of livestock of state agriculture lessees. 5. All pipelines placed' on said lands by virtue of this grant shall be buried not less than twenty inches (20") deep. An exception to this requirement may be granted on other than agricultural lands when hard rock is encountered which would require blasting, or when a temporary pipeline is necessary and will not unduly hamper other surface uses. Deviation of the twenty-inch depth must be shown on the plat accompanying the application for right-of-way or by the filing of an amended plat upon completion of construction. 6. Grantee hereby agrees to carefully avoid destruction or injury to any improvements or livestock lawfully upon the premises described herein, to close all gates immediately upon passing through same, and to pay promptly the reasonable and just damages for any injury or destruction arising from construction or maintenance of this right-of way. 7. Grantee shall not assign this right-of-way without the prior written approval of Grantor. Such approval may be conditioned upon the agreement by Grantee's assignee to additional conditions and covenants and may require payment of additional compensation to Grantor. This right-of-way is for the sole purpose stated and no other. Grantee agrees not to sell or otherwise grant to any person or entity any interest therein or the right to use any portion thereof. 8. The rights granted herein are subject to valid existing rights. 9. Grantor reserves the right to execute leases for oil and gas, coal, and minerals of whatenver kind and for geothermal resources development and operation, the right to sell or dispose of same and the right to grant rights-of-way and easements related to such leasing. 10. In all matter affecting the premises described herein or operations thereon, Grantee, its employees, agents and contractors chat at their own expense, fully comply with all laws, regulations, rules, ordinances, and requirements of any governmental authority or agency, which may be enacted or promulgated, including, but not limited to, requirements or enactment's pertaining to conservation, sanitation, aesthetics, pollution, cultural properties, fire, or ecology, including those provisions of the New Mexico Cultural Plupecties Act, 618-6-1 through 17, NMSA 1978, that attach criminal penalties to the appropriation, excavation, injury or destruction of any site or object of historical, archaeological, architectural, or scientific value located on state lands. In addition, Grantee, its employees, agents and contractors must comply with the provisions of the Pipeline Safety Act, §§ 70-3-11 through 20, NMSA 1978, and rules enacted pursuant to the Act, and agree to provide the Public Regulation Commission access to records of compliance. 11. Non-use of the right-of-way granted herein for any period in excess of one (1) year without the prior written consent of Grantor shall be conclusive proof of abandonment of the right-of-way, and non-use for shorter periods shall place upon grantee the burden of providing that there was no intent to abandon. S-25 (Revised 01/03/2000) EFTA00315625 (3) Right-of-Way Easement No. RW-30137 12. Grantee, if other than a governmental entity that is provided immunity from suit by the New Mexico Tort Claims Act, agrees to save and hold harmless, defend and indemnify the State of New Mexico, the Commissioner of Public Lands, and his agents or employees, in their official and individual capacities, of and from any and all liability, claims, losses, or damages arising out of or alleged to arise out of or indirectly connected with the operations of Grantee, its employees, agents, or contractors hereunder. 13. Notwithstanding anything contained herein, Grantor may cancel this grant for violation of any of the covenants of this agreement; provided, however, that before any such cancellation chall become effective, Grantor shall mail to grantee or any approved assignee, by certified mail addressed to the post office address of Grantee or such assignee shown by Land Office records, a thirty (30) day notice of intention to cancel, specifying the default for which the grant is subject to cancellation. No proof of receipt of notice shall be necessary and thirty (30) days after such mailing, Grantor may enter cancellation unless Grantee shall have sooner remedied the default to the satisfaction of Grantor. 14. Grantee agrees to preserve and protect the natural environmental conditions of the land encornpacsed in this grant, and to take those reclamation or corrective actions that are accepted soil and water conservation practices and that are deemed neenewy by Grantor to protect the land from pollution, erosion, or other environmental degradation. 15. Grantee agrees to reclaim by grading, leveling, or terracing all areas disturbed by the construction or maintenance of the right-of-way or operations thereon and to landscape such areas at its own cost and expense. Landscaping shall include the planting of native grasses, shrubs, or other vegetation so as to return disturbed areas to their natural state and prevent water and wind erosion. 16. This grant shall become effective upon its execution by Grantor. STIPULATION: S-25 (Revised 01/03/2000) EFTA00315626 (4) - -of-Wa t No. RW-30137 GRAN By: ACKNOWLEDGMENT STATE OF Niewl ) ss. COUNTY OF N/e. %Ale eric_ The foregoing instrument was acknowledged before me this e-2 day of Aug LISt by Eesit- in of taus* a 4c My Commission Expires: LAUREN J. KWUNTNER Notary Public, State of New York No. 02KW6016686 Qualified in New York County Commission Expires November 30, 20 LA STATE OF NEW MEXICO of said-Geaperatierck4st- Y PUBLIC BY* PO-37.1:43t COMMISSIONER OF PUBLIC S-25 (Revised 01/03/2000) ,it EFTA00315627 My Commission Expires: NEW MEXICO STATE LAND OFFICE AFFIDAVIT OF COMPLETION OF RIGHT-OF-WAY CONSTRUCTION Zorro Trust of (Name of Individual or Entity Holding Right-of-Way) 4,57 Marl qnn Ava WPW Yrirk, New Thy-le 10072 (Address) , issued for construction operation and location holder of Right-of-Way No. ER-30137 of a Rizht of Way Easement (type of right-of-way) hereby certifies that construction of the subject right-of-way has been completed, and that all guidelines of the State Land Office relating to reseeding and reclamation of disturbed areas have been or will be followed. OR No construction was required as the right-of-way is for an existing orized Representative Manager Position • ACKNOWLEDGEMENT STATE OF NEW MEXICO ) SS. COUNTY Santa Pe The foregoing instrument was acknowledged before me this 21st day of September 20 06 by Brice Gordon Manager of Zorro Trust (Tide of Officer, if applicable, and name of Corporation) 4-, a-v.A-hi. ,J,4,-)1 12 II? 120e-i-Notary Public Note: Rule 10.013 Affidavit of Completion. Upon the completion of construction of any right-of-way, the applicant shall promptly file with the Commissioner of Public Lands an Affidavit of Completion. Failure to file such Affidavit in accordance with this section shall subject the right-of-way to cancellation in accordance with the provisions of these rules. S-63 (Revised 01/03/2000) EFTA00315628