Section 299.4026. Awarding of leases.

Rule 6. (1) Lessor approval is required before any lease is issued.

(2)  The department may group lease sale units for which the issuance of leases has been approved into 1 or more leases, depending on the location of the lease sale units and any special lease conditions.

(3)   Before a lease shall be executed for any state lands, the successful bidder shall file a performance bond to the lessor, unless waived by the lessor. The amount of performance bond, maximum acreage covered, and when and how the bond may be drawn upon shall be specified by the lessor and shall be in accordance with the bond schedule approved by the lessor on April 10, 1986.

(4)    Two copies of each lease instrument shall be provided, by certified mail, to the lessee for signature. Unless otherwise agreed to in writing by the lessor, the lessee shall return all copies, properly executed, with performance bond, within 30 days from the date of receipt  shown  on  the receipt form of the post office department.

(5)   If the lessee is unable to return the lease forms and performance bond within the time specified, the lessor shall, upon request of  the lessee, authorize additional time if the delay is not the fault of the lessee. Failure of the lessee to comply within time limits authorized shall result in forfeiture of the entire bid paid. Lands on which lease rights have been forfeited shall be offered for leasing at the  earliest

possible date, unless withdrawn by the lessor or  unless  leased  under   R 299.4025.

(6)   The original copy of the properly executed lease shall be returned to the lessee and the duplicate copy shall be retained by the lessor.

(7)   Operations on any leased lands shall not be conducted until a fully executed lease has been received by the lessee.

(8)   All leases are subject to all federal, state, and local laws.

(9)   The lessor shall require any lease applicant on any lease sale unit or assignee under any lease to submit all of the following information:

(a)  If an individual, proof of attainment of legal age.

(b)   If a co-partnership, a certified copy of the registration or a sworn statement signed by l partner setting forth the names and addresses of all partners and the articles of partnership.

(c)   If a corporation or other legal entity, copies of the incorporation papers showing the entity's qualifications to do business in the state of Michigan. The lessee shall file these papers with the lessor within 30 days from the date of receipt of the lessor's notice of award as shown  on the receipt form of the post office department.

History: 1987 AACS.