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AMENDMENT NO. TWO TO CONTRACT NO. K-0607-47: BY AND BETWEEN THE CITY OF NORMAN, OKLAHOMA, AND SAND EXPRESS, INC., CLARIFYING TERMS OF THE CONTRACT, ASSIGNING OWNERSHIP TO ADKINS MATERIAL CENTER, L.L.C.; D/B/A SAND XPRESS, L.L.C., AND PROVIDING FOR PAYMENT OF OUTSTANDING ROYALTIES IN THE AMOUNT OF $24,000.
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BACKGROUND: The City of Norman entered into a contract in 2006 with Sand Express, Inc. to mine sand on City-owned property near the Canadian River. The contract terms required Sand Express to use the land solely for mining sand and to pay the City a specified amount for area of sand mined with payments to be adjusted upwards over time to adjust for inflation.
Sand Express, Inc. has encountered financial difficulties, and, as a result, has ceased operation of the sand pit. When Sand Express went out of business, the City believed that Sand Express, Inc. owed the City of Norman back royalties for mined sand. City staff calculates that Sand Express owed $24,000. Sand Express contended that they had assigned their contract with the City of Norman to Adkins Material Center, LLC. Questions regarding the property amount of back sand mining royalties, whether the lease was properly assigned, and whether Adkins Material Center, LLC or Sand Xpress, LLC should be allowed to continue the sand mining operation all appeared to be leading to litigation of these issues. City Staff has negotiated a proposed contract amendment with Adkins Material Center, LLC d/b/a Sand Xpress. The potential litigation issues and the proposed contract amendment were discussed in Executive Session with City Council on February 12th. Adkins Material Center, LLC now wants to begin mining sand, and they have requested permission to do so from the City of Norman.
Council asked for additional background information concerning the Lease assignee. Adkins Material Center, LLC is an Oklahoma Limited Liability Company based in Norman, Oklahoma with its corporate office located at...
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