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1 SOLAR ENERGY POWER PURCHASE AGREEMENT BETWEEN [SELLER] AND BOROUGH OF EPHRATA, PA This SOLAR ENERGY POWER PURCHASE AGREEMENT (this "PPA " or this “Agreement ”) is entered into this day of_______ , 2017 (“Effective Date ”), by and between ____________________________ ("Seller "), a [Pennsylvania limited liability company], and (ii) the Borough of Ephrata, Pennsylvania ("Borough " or “Ephrata ”), a municipal corporation of the Commonwealth of Pennsylvania. Seller and Borough are hereinafter referred to individually as a "Party " and collectively as the "Parties ". WHEREAS Seller desires to develop, design, construct, own, operate, and maintain a solar electric generating facility with an expected total name plate capacity of up to ____ MW (AC) at the project site (the “Nameplate Capacity ”), and which is further referred to as the "Facility "; WHEREAS, Ephrata is the owner of the real property (“Site ”) upon which the Facility will be located; WHEREAS, Seller desires to lease the Site from the Borough for purposes of developing, designing, constructing, owning, operating and maintaining the Facility in accordance with the terms of the Agreement, the Facility and Site both being more particularly described on Exhibit B ; WHEREAS Seller will sell and deliver to Borough, and no other entity, during or after the term of this Agreement, at the Delivery Point, the Solar Energy and all other Facility attributes produced by the Facility, except as explicitly provided herein;
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SOLAR ENERGY POWER PURCHASE AGREEMENT
BETWEEN
[SELLER]
AND
BOROUGH OF EPHRATA, PA
This SOLAR ENERGY POWER PURCHASE AGREEMENT (this "PPA " or this “Agreement”) is entered into this day of_______ , 2017 (“Effective Date ”), by and between ____________________________ ("Seller"), a [Pennsylvania limited liability company], and (ii) the Borough of Ephrata, Pennsylvania ("Borough" or “Ephrata”), a municipal corporation of the Commonwealth of Pennsylvania. Seller and Borough are hereinafter referred to individually as a "Party" and collectively as the "Parties".
WHEREAS Seller desires to develop, design, construct, own, operate, and maintain a solar electric generating facility with an expected total name plate capacity of up to ____ MW (AC) at the project site (the “Nameplate Capacity”), and which is further referred to as the "Facility";
WHEREAS, Ephrata is the owner of the real property (“Site”) upon which the Facility will be located;
WHEREAS, Seller desires to lease the Site from the Borough for purposes of developing, designing, constructing, owning, operating and maintaining the Facility in accordance with the terms of the Agreement, the Facility and Site both being more particularly described on Exhibit B;
WHEREAS Seller will sell and deliver to Borough, and no other entity, during or after the term of this Agreement, at the Delivery Point, the Solar Energy and all other Facility attributes produced by the Facility, except as explicitly provided herein;
WHEREAS Borough desires to purchase Solar Energy from Seller and use such Solar Energy as a behind the meter generation resource for purposes of serving the Borough’s inhabitants; and,
NOW, THEREFORE, in consideration of the mutual covenants contained herein, the Parties agree to the following:
ARTICLE 1- DEFINITIONS AND RULES OF INTERPRETATION
1.1 Rules of Construction . Except as otherwise provided in this PPA, the capitalized terms listed in this Article shall have the meanings set forth herein whenever the terms appear in this PPA. Words not otherwise defined herein that have well known and generally accepted technical or trade meanings are used herein in accordance with
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such recognized meanings. In addition, the following rules of interpretation shall apply:
(A) References to "Articles," "Sections," or "Exhibits" shall be to articles, sections, or exhibits of this PPA.
(B) The Exhibits attached hereto are incorporated in and are intended to be a part of this PPA; provided, that in the event of a conflict between the terms of any Exhibit and the terms of this PPA, the terms of this PPA shall take precedence.
(C) The Parties shall act reasonably and in accordance with the principles of good faith and fair dealing in the performance of this PPA.
(D) Use of the words "include" or "including" or similar words shall be interpreted as "including but not limited to" or "including, without limitation."
1.2 Definitions . The following t e r m s s h a l l have the m e a n i n g s s e t forth he r e i n :
"Abandonment" means (i) the relinquishment of all possession, control, or operation and maintenance of the Facility by Seller, other than a transfer permitted under this PPA, or (ii) if prior to the Commercial Operation Date, complete cessation of the design, construction, testing and inspection of the Facility, for sixty (60) consecutive Days by Seller and/or Seller's contractors, but only if such relinquishment or cessation is not caused by or attributable to an Event of Default of, or request by, Borough, or an event of Force Majeure.
"AC" means alternating electric current.
"Additional Term" has the meaning set forth in Article 2.
"Affiliate" of any named person or entity means any other person or entity that controls, is under the control of, or is under common control with, the named entity. The term "control" (including the terms "controls", "under the control of and “under common control with") means the possession, directly or indirectly, of the power to direct or cause the direction of the management of the policies of a person or entity, whether through ownership interest, by contract or otherwise.
"Applicable Law " means all applicable laws, statutes, treaties, codes, ordinances, regulations, certificates, orders, licenses and permits of any Governmental Authority, now in effect or hereafter enacted, amendments to any of the foregoing, interpretations of any of the foregoing by a Governmental Authority having jurisdiction, and all applicable judicial, administrative, arbitration and regulatory decrees, judgments, injunctions, writs, orders, awards or like actions (including those relating to human health, safety, the natural environment or otherwise).
"Back-Up Metering" has the meaning set forth in Section 5.3(B).
"Bankruptcy Event " means with respect to a Party, that either:
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(i) such Party has (A) applied for or consented to the appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of itself or of all or a substantial part of its property; (B) admitted in writing its inability, or be generally unable, to pay its debts as such debts become due; (C) made a general assignment for the benefit of its creditors; (D) commenced a voluntary case under any bankruptcy law; (E) filed a petition seeking to take advantage of any other law relating to bankruptcy, insolvency, reorganization, winding up, or composition or readjustment of debts; (F) failed to controvert in a timely and appropriate manner, or acquiesced in writing to, any petition filed against such Party in an involuntary case under any bankruptcy law; or (G) taken any corporate or other action for effecting any of the foregoing; or
(ii) a proceeding or case has been commenced without the application or consent of such Party in any court of competent jurisdiction seeking (A) its liquidation, reorganization, dissolution or winding-up or the composition or readjustment of debts or, (B) the appointment of a trustee, receiver, custodian, liquidator or the like of such Party under any bankruptcy law, and such proceeding or case has continued undefended, or any order, judgment or decree approving or ordering any of the foregoing shall be entered and continue unstayed and in effect for a period of sixty (60) days.
"Business Day " means any calendar day that is not a Saturday, a Sunday, or a day on which commercial banks in Pennsylvania and/ or the Government Offices of the Borough of Ephrata, Pennsylvania are authorized or required to be closed.
"Change in Law" means (i) the enactment, adoption, promulgation, modification or repeal after the Effective Date of any Applicable Law; or (ii) the imposition of any material conditions on the issuance or renewal of any Applicable Permits after the Effective Date (notwithstanding the general requirements contained in any Applicable Permit at the time of application or issue to comply with future laws, ordinances, codes, rules, regulations or similar legislation) which renders unlawful any provision of this Agreement pertaining to the owning, constructing, installing, operating or maintaining the Facility, supplying or purchasing of Solar Energy or Environmental Attributes, or other performance of a Party’s obligations hereunder; provided, that a change in federal, state, county or any other jurisdiction's tax law after the Effective Date shall not be a Change in Law pursuant to this Agreement.
"Commercial Operation " means the period beginning on the Commercial Operation Date and continuing through the Term of this PPA.
"Commercial Operation Date " or "COD" for the Facility means the date of Seller's COD notice with respect thereto under Section 4.5.
"Commercial Operation Year " means any consecutive twelve (12) month period during the Term of this PPA, commencing with the Commercial Operation Date or any of its anniversaries.
"Construction Milestone (s) " means the construction milestones described in Exhibit A .
"Day" means a calendar day.
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“Daylight Hours” means the total time that the entire sun is above the horizon. This will be the elapsed time beginning at sunrise and ending at sunset, as defined by the United States National Weather Service in the area where the Facility is located.
“Delivery Line” means the dedicated distribution level line constructed by the Borough to connect the Facility to the Borough’s electric distribution system.
"Delivery Point" means the point at which Seller makes available to Borough and delivers to Borough the Solar Energy output by the Facility; the Delivery Point shall be the high side of the Facility’s step-up transformer, located on the Site; Seller is responsible for delivery at 12,400 volts.
"Electric Metering Device(s) " means all metering and data processing equipment used to measure, record, or transmit data relating to the Solar Energy output from the Facility.
"Environmental Contamination " means the introduction or presence of Hazardous Materials at such levels, quantities or location, or of such form or character, as to constitute a violation of federal, state or local laws or regulations, and present a material risk under federal, state or local laws and regulations that the Site will not be available or usable for the purposes contemplated by this PPA.
"Environmental Attributes " means any emissions, air quality, Solar Renewable Energy Credits (SRECs) or other environmental attribute, aspect, characteristic, claim, credit, benefit, reduction, offset, or allowance, howsoever entitled or designated, resulting from, attributable to or associated with the Facility’s benefits to the environment and capable of being measured, verified or calculated.
“Environmental Incentives” means the monetary value, tax credits, or other financial incentive arising from the Facility’s Environmental Attributes.
"Estimated Annual Energy Output" means with respect to each Commercial Operation Year, the estimated output with respect to such Commercial Operation Year set forth in Exhibit C.
"Event of Default" has the meaning set forth in Article 10.
"Facility" means Seller's solar electric generating facility, including the associated equipment and components, as identified and described in Article 3 and Exhibit B to this PPA.
"Facility Debt" means the obligations of Seller to any lender or lessor pursuant to the Financing Documents, including principal of, premium and interest on indebtedness, fees, expenses or penalties, amounts due upon acceleration, prepayment or restructuring, swap or interest rate hedging breakage costs and any claims or interest due with respect to any of the foregoing
"Facility Lender " means, collectively, any lender(s) or lessors providing any Facility Debt and any successor(s) or assigns thereto.
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“Fair Market Value ” has the mean ing se t f o r th i n Sec t i on 14 .2 .
"FERC" means the Federal Energy Regulatory Commission or any successor agency.
"Financing Documents " means the loan, credit or lease agreements, notes, bonds, indentures, security agreements, lease financing agreements, mortgages, deeds of trust, interest rate exchanges, swap agreements and other documents relating to the development, bridge, construction and/or permanent debt financing for the Facility, including any credit enhancement, credit support, working capital financing or refinancing documents, and any and all amendments, modifications, or supplements to the foregoing that may be entered into from time to time at the discretion of Seller in connection with development, design, construction, ownership, leasing, operation or maintenance of the Facility.
"Force Majeure " shall have the meaning set forth in Article 12.
"Forced Outage " means any condition at the Facility that requires immediate removal of the Facility, or some part thereof, from service.
"Good Utility Practice(s) " means the practices, methods, and acts that, at a particular time, in the exercise of reasonable judgment in light of the facts known or that should reasonably have been known at the time a decision was made, would have been expected to accomplish the desired result in a manner consistent with Applicable Law; t h e standards, practices, and methods approved by a significant portion of the utility industry during the relevant time period; equipment manufacturer's recommendations; reliability, safety, environmental protection, economy, and expedition.
"Governmental Authority " means any federal, state, local or municipal governmental body; any governmental, quasi-governmental, regulatory or administrative agency, commission, body or other authority exercising or entitled to exercise any administrative, executive, judicial, legislative, policy, regulatory or taxing authority or power; or any court or governmental tribunal.
"Guaranteed Period" has the meaning set forth in Section 9.5.
"Guaranteed Output" has the meaning set forth in Section 9.5.
"Guaranteed Commercial Operation Date " means the date the Seller guarantees the plant will be ready and capable of supplying Nameplate Capacity, as identified in Section 3.1, to Borough at the Delivery Point and is ready for Commercial Operation. The Guaranteed Commercial Operation Date is set forth in Exhibit A .
"Hazardous Materials " means any substance, material, gas, or particulate matter that is regulated (or becomes regulated) by any local governmental authority, any applicable State or Commonwealth, or the United States of America, as an environmental pollutant or dangerous to public health, public welfare, or the natural environment including, without limitation, protection of nonhuman forms of life, land, water, groundwater, and air, including any material or substance that is defined as a "hazardous substance" pursuant to the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C.
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§9601 et seq. (42 U.S.C. §9601).
"Initial Term" has the meaning set forth in Article 2.
"Internal Revenue Code" means the U.S. Internal Revenue Code of 1986, including applicable rules and regulations promulgated thereunder, as amended from time to time.
“Lease Agreement” means that certain Lease Agreement entered into betweenBorough and Seller as of the Effective Date, a copy of which is attached as Exhibit G, pursuant to which Borough agrees to lease the Site to Seller.
"Lender Consent " shall have the meaning set forth in Section 17.2.
"Maximum Delay Damages" means $270,000.
"MW" means megawatt or one thousand kW.
"MWh" means megawatt hour.
“Nameplate Capacity” means the maximum power output of the Facility which can be delivered by the Seller to the Borough at the Delivery Point.
"Operating Committee " means one representative each from Borough and Seller pursuant to Section 9.6.
"Operating Procedures " means those procedures developed pursuant to Section 9.6, if any.
"Operating Records " means all agreements associated with the Facility, operating logs, blueprints for construction, as-built drawings, operating manuals, all warranties on equipment, and all documents, whether in printed or electronic format, that the Seller uses or maintains for the operation of the Facility.
"Outside COD" means the date ninety (90) days after the Guaranteed Commercial Operation Date.
"PPA” means this Solar Energy Power Purchase Agreement between Seller and Borough, including the Exhibits attached hereto.
"Site" means the parcel of real property on which the Facility will be constructed and located, including any easements, rights of way, surface use agreements and other interests or rights in real estate reasonably necessary for the construction, operation and maintenance of the Facility, as more specifically described in Exhibit B. The Site is leased by the Seller from Borough pursuant to the Lease Agreement attached as Exhibit G to this PPA.
"Solar Energy " means the net electric energy, including capacity, transmission and ancillary services benefits, if any, generated from the Facility using solar electric generation technologies delivered to the Delivery Point as measured by the Electric Metering
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Devices installed pursuant to Section 5.3.
"Solar Energy Payment Rate" means $XX.XX per MWh to be paid by Borough to Seller for Solar Energy delivered by Seller to Borough.
"Tax Credits" means any investment tax credit that relates to the construction or ownership of the Facility, the use of technology incorporated into the Facility, or other similar programs available from any Governmental Authority, including but not limited to Section 48 of the Internal Revenue Code.
"Term" means the period of time during which this PPA shall remain in full force and effect, and which is further defined in Article 2.
"Test Energy " means that energy which is produced by the Facility, delivered to Borough at the Delivery Point, and purchased by Borough, pursuant to Section 4.6, in order to perform testing of the Facility prior to Commercial Operation.
ARTICLE 2 – TERM AND TERMINATION
This PPA shall become effective as of the date of its execution, and shall remain in full force and effect until the twenty-fifth (25th) anniversary of COD (the "Initial Term") subject to early termination or any provisions set forth herein.
Either Party may give the other Party written notice of its desire to extend this PPA on the terms and conditions set forth herein for an additional four (4) years (any such "Additional Term," together with the Initial Term, the "Term"). Such notice shall be given, if at all, not more than one hundred twenty (120) and not less than sixty (60) days before the last day of the Initial Term, as applicable. The Party receiving the notice requesting an Additional Term shall respond positively or negatively to that request in writing within thirty (30) days after receipt of the request. Failure to respond within such period shall be deemed a reject on of the offer for an Additional Term. If both Parties agree to an Additional Term, the Additional Term shall begin immediately upon the conclusion of the Initial Term on the same terms and conditions as set forth in this PPA and at the Solar Energy Payment Rate negotiated and agreed to by Seller and Ephrata. Notwithstanding the foregoing, if the Parties are unable to agree on the Solar Energy Payment Rate, then this PPA shall terminate at the end of the Initial Term (if the same has not been extended). If the Party receiving the request for an Additional Term rejects or is deemed to reject the first Party's offer, this PPA shall terminate at the end of the Initial Term (if the same has not been extended).
ARTICLE 3 - FACILITY DESCRIPTION
3.1 Summary Description . Seller shall develop, design, construct, own, operate, and maintain the Facility, which shall consist of solar panels, inverters and associated equipment having an aggregate Nameplate Capacity of approximately ____ MW (AC). Exhibit B to this PPA provides a description of the Facility, including identification of the major equipment and components that will make up the Facility. The Facility does not include the Site on which the Facility sits.
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3.2 Location . The Facility shall be located on the Site described in Exhibit B .
3.3 General Design of the Facility . Seller shall construct the Facility according to Good Utility Practice(s), including all (i) applicable requirements, practices, methods, acts, guidelines, standards; (ii) NERC standards; and (iii) Applicable Laws.
3.4 Ownership .
(A) Throughout the Term, Seller shall be the legal and beneficial owner of the Facility at all times, and the Facility shall remain the personal property of Seller and shall not attach to or be deemed a part of, or fixture to, the Site; provided, however, that this provision shall not limit or restrict any permitted transfer of the Facility or assignment of this PPA as otherwise provided in this PPA. Each of the Seller and Borough agree that the Seller is the tax owner of the Facility and all tax filings and reports will be filed in a manner consistent with this Agreement. The Facility shall at all times retain the legal status of personal property as defined under Article 9 of the Uniform Commercial Code.
(B) Throughout the Term, the Borough shall be the legal and beneficial owner of the Site at all times, and the Site shall remain the real property of the Borough; provided, however, that this provision shall not limit or restrict any permitted transfer of the Site or assignment of this PPA as otherwise provided in this PPA. Each of the Seller and Borough agree that the Borough is the tax owner of the Site and all tax filings and reports will be filed in a manner consistent with this Agreement; provided, however, that the payment of all real property taxes shall be subject to applicable provisions under the Lease Agreement.
ARTICLE 4 - COMMERCIAL OPERATION
4.1 Construction Milestones . Seller agrees to use commercially reasonable efforts to meet the Construction Milestones set forth in Exhibit A to this PPA, including to achieve the Commercial Operation Date by the Guaranteed Commercial Operation Date. Seller shall be solely responsible for all costs and the performance of all tasks required for developing, designing, and constructing the Facility and rendering it commercially operational.
4.2 Progress Reports . Commencing upon the execution of this PPA, Seller shall submit to Borough, on the fifth Day of each calendar month until the Commercial Operation Date, w r i t t e n progress reports in a form reasonably satisfactory to Borough. These progress reports shall notify Borough of the current status of each Construction Milestone.
4.3 Borough's Rights During Construction . Borough shall have the right to monitor the construction, start-up and testing of the Facility, and Seller shall comply with all reasonable requests of Borough with respect to the monitoring of these events. Seller shall cooperate in such physical inspections of the Facility as may be reasonably requested by Borough during and after completion of construction. All persons visiting the Facility on behalf of Borough shall comply with all of Seller's applicable safety and health rules and requirements. Borough's technical review and inspection of the Facility shall not be construed as endorsing the design thereof nor as any warranty of safety, durability, or
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reliability of the Facility.
4.4 Permits . Seller shall use commercially reasonable efforts to obtain, and shall pay for, all applicable environmental and other permits, licenses and approvals from any Governmental Authority required under applicable law for construction, ownership, operation and maintenance of the Facility ("Applicable Permits ").
4.5 Commercial Operation . Seller shall notify the Borough in writing at least 30 days in advance of its intent to begin Commercial Operation. The Seller will also notify the Borough in writing when the actual Commercial Operation Date has occurred. Such notice shall certify by an officer of Seller pursuant to a certificate delivered by Seller, all of the following conditions have been fulfilled: (i) the Facility is able to generate electric energy in compliance with the Applicable Permits, (ii) the Facility has been tested successfully under the acceptance test criteria set forth in the contracts for the construction and commissioning, (iii) Seller has made all arrangements and executed or obtained all material easements, rights of way, and other real property rights necessary for construction, maintenance and operation of the Facility; and (iv) Seller has obtained retail distribution electric service for the Facility.
4.6 Test Energy . Seller shall coordinate the production and delivery of Test Energy with Borough, with such prior notice as Borough may reasonably request. Borough shall cooperate with Seller to facilitate Seller's testing of the Facility necessary to satisfy the conditions set forth in Section 4.5, and shall accept delivery of all Test Energy produced by the Facility which has been installed and shall purchase all such Test Energy delivered to the Delivery Point at a payment rate of thirty percent (30%) of the Solar Energy Payment Rate.
4.7 Delay Penalty . In the event that Seller does not achieve COD by Guaranteed Commercial Operation Date, Seller shall pay to Borough as Borough's sole remedy, a Delay Penalty, in the amount of the $0.25 / day / nameplate kW, for each such day of delay. Such delay penalties shall be paid by Seller no later than the thirtieth (30th) day of the month following the month that any such delay occurs or is continuing. The Delay Penalty shall not exceed the Maximum Delay Damages.
4.8 Construction Security . Beginning seven days after satisfaction of the conditions precedent described in Section 6.1, Seller shall post security, consisting in Seller's sole election of: (i) a customary payment and performance bond in the amount of Maximum Delay Damages; (ii) a letter of credit from a Creditworthy Bank authorized to do business in the Commonwealth of Pennsylvania (a U.S. commercial bank or a U.S. branch of a foreign bank, which U.S. commercial bank or foreign bank has at the applicable time a Credit Rating of (a) A- or better from Standard & Poor's or (b) A3 or better from Moody's) in the amount of Maximum Delay Damages; (iii) cash collateral in the amount of Maximum Delay Damages; or (iv) a parent guaranty (from an entity with an Investment Grade Credit defined as a Credit Rating of (i) BBB- or better from Standard & Poor's or (ii) Baa3 or better from Moody's, to secure Seller's obligations to construct the Facility. Such security shall be maintained for a period of sixty (60) days after the achievement of COD.
ARTICLE 5 – DELIVERY AND METERING
5.1 Delivery Arrangements .
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(A) Seller shall be responsible for all actions and related costs required to deliver the Solar Energy and Test Energy from the Facility to Borough at the Delivery Point. Seller shall be deemed to be in control of the Solar Energy and Test Energy output from the Facility up to and until delivery at the Delivery Point. Title and risk of loss related to the Solar Energy and Test Energy shall transfer from Seller to Borough at the Delivery Point.
(B) Borough shall be responsible for receiving Solar Energy and Test Energy at the Delivery Point and for all electric losses, transmission and ancillary service arrangements and costs at and after the Delivery Point. The Borough shall be deemed to be in control of Solar Energy and Test Energy at and after receipt at the Delivery Point.
5.2 Curtailment . Subject to Section 7.2, Borough shall have the right to notify and direct Seller to curtail the delivery of Solar Energy to Borough from the Facility and to the Delivery Point provided, however, that, except in case of an Emergency Condition or Forced Outage, Borough must notify Seller in writing of each Scheduled Outage at least two business days in advance of the commencement of a Scheduled Outage and shall use reasonable efforts to schedule outages outside of Daylight Hours.
5.3 Electric Metering Devices .
(A) Seller, at its own expense, shall inspect and test all Electric Metering Devices upon installation and at least one time per year in accordance with Good Utility Practices. Seller shall provide Borough with reasonable advanced notice of, and permit a representative of Borough to witness and verify, such inspections and tests, provided, however, that Borough shall not interfere with or disrupt the activities of Seller and shall comply with all of Seller's safety standards. Upon request by Borough upon reasonable evidence of inaccuracy, Seller shall perform additional inspections or tests of any Electric Metering Device and shall permit a qualified representative of Borough to inspect or witness the testing of any Electric Metering Device. The actual expense of any such requested additional inspection or testing shall be borne by Borough, unless upon such inspection or testing an Electric Metering Device is found to register inaccurately by more than the allowable limits established in this Article, in which event the expense of the requested additional inspection or testing shall be borne by Seller. If requested by Borough in writing, Seller shall provide copies of any inspection or testing reports to Borough.
(B) Borough may elect to install and maintain, at its own expense, backup metering devices ("Back-Up Metering") in addition to those installed and maintained by Seller, which installation and maintenance shall be performed in a manner reasonably acceptable to Seller. Borough, at its own expense, shall inspect and test Borough's Back-Up Metering upon installation in accordance with Good Utility Practices. Borough shall provide Seller with reasonable advance notice of, and permit a representative of Seller to witness and verify, such inspections and tests.
5.4 Adjustment for Inaccurate Meters . If an Electric Metering Device fails to register, or if the measurement made by an Electric Metering Device is found upon testing to be inaccurate by more than one percent (1.0%), an adjustment shall be made correcting all measurements by the inaccurate or defective Electric Metering Device, or Borough's Back-Up Metering, for both the amount of the inaccuracy and the period of the inaccuracy, in the following manner:
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(A) In the event that the Electric Metering Device is found to be defective or inaccurate, the Parties shall use Borough's Back-up Metering, if installed, to determine the amount of such inaccuracy, provided, however, that Borough's Back-Up Metering has been tested and maintained in accordance with the provisions of this Article.
(B) In the event that the Parties cannot agree on the actual period during which the inaccurate measurements were made, the period during which the measurements are to be adjusted shall be the shorter of (i) the last one-half of the period from the last previous test of the Electric Metering Device to the test that found the Electric Metering Device to be defective or inaccurate, or (ii) the one hundred eighty (180) Days immediately preceding the test that found the Electric Metering Device to be defective or inaccurate.
(C) To the extent that the adjustment period covers a period of deliveries for which payment has already been made by Borough, Seller shall use the corrected measurements as determined in accordance with this Article to recalculate the amount due for the period of the inaccuracy and shall subtract the previous payments by Borough for this period from such re-computed amount. If the difference is a positive number, the difference shall be paid by Borough to Seller; if the difference is a negative number, that difference shall be paid by Seller to Borough.
ARTICLE 6 - CONDITIONS PRECEDENT
6.1 Conditions to Seller’s Obligations . Seller’s obligations under this PPA are conditioned on the completion of the following conditions to the Borough's reasonable satisfaction, each of which Seller shall use good faith efforts to obtain:
(A) Seller’s completion of due diligence with respect to the Site including, if applicable, geotechnical work, and real estate due diligence to confirm the suitability of the Site, all to Seller's reasonable satisfaction; provided, however, this condition precedent shall be deemed satisfied if Seller has not terminated this PPA on or before the date that is thirty (30) days prior to the construction start date in the Construction Milestones set forth in Exhibit A .
(B) Receipt of all necessary zoning, land use and building permits.
(C) Seller shall design the Facility to meet PPL Electric Utilities’ (“PPL EU”) system protection requirements contained in Exhibit F and provide Borough with sufficiently detailed one-line diagrams and any other supporting documentation necessary to secure applicable PPL EU approvals.
6.2 Conditions to Borough’s Obligations . Borough’s obligations under this PPA are conditioned on the completion of the following conditions to Seller's reasonable satisfaction, each of which Borough shall use good faith efforts to obtain:
(A) Receipt of PPL EU’s approval that the Facility’s design satisfies the system protection requirements set forth in Exhibit F .
6.3 Early Termination.
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(A) If any of the conditions listed in Sections 6.1 are not satisfied by Seller, the Parties will attempt in good faith to negotiate new dates for the satisfaction of such conditions that are not satisfied. If the Parties are unable to negotiate new dates and any condition that has not been satisfied does not result from Force Majeure or the actions/omissions of the terminating Party, then either Party may terminate this PPA upon ten (10) days' prior written notice to the other Party.
(B) If Seller has not achieved COD by the Outside COD, either Party will have the option to terminate, without triggering a default under this PPA, provided, however, that Seller shall be liable for any Delay Penalty that accrued prior to the date of such termination. The right to terminate in this Section 6.3 will expire upon the earlier of (i) the Facility’s COD and (ii) the date on which the Facility achieves Commercial Operation on or before the Outside COD.
6.4 Achievement of COD Satisfies Conditions Precedent . Notwithstanding the foregoing or anything herein to the contrary, if Seller achieves COD as provided in Section 4.5, then all of the conditions precedent to Borough's obligations shall be deemed satisfied.
ARTICLE 7 – SALE AND PURCHASE OF SOLAR ENERGY
7.1 Solar Energy Payment Rate . Commencing on the Commercial Operation Date of the Facility, Borough shall pay Seller the Solar Energy Payment Rate for each MWh of Solar Energy delivered by Seller to the Delivery Point.
7.2 Payment for Curtailed Energy .
(A) If delivery of Solar Energy is curtailed by Borough pursuant to a Scheduled Outage as contemplated under Section 5.2, then
(1) Seller shall use reasonable means consistent with customary industry practice and existing data for the Facility to determine the quantity of Solar Energy that would have been produced by the Facility and delivered to the Delivery Point had its generation not been so curtailed ("Curtailment Energy") and
(2) Borough shall pay to Seller a penalty for each MWh of Curtailment Energy in the amount equal to the Solar Energy Payment Rate.
(B) Notwithstanding anything in this Section 7.2 to the contrary, the penalty payments shall be due Seller under Section 7.2(A), only to the extent that the aggregate duration of such curtailments exceeds a total of twenty-four Daylight Hours per Commercial Operation Year during the Term.
(C) The penalty payments as described in this Section 7.2 shall not be construed as imposing a take-or-pay or take-and-pay obligation upon the Borough.
ARTICLE 8 - BILLING AND PAYMENT
8.1 Billing Invoices . The billing period under this PPA shall be the calendar
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month. No later than the fifth Day after the end of each month commencing on the first month following COD, Seller shall provide Borough by email, a statement showing the payment amount due Seller by Borough for the power provided by Seller and purchased by Borough, under this PPA, during the previous calendar month billing period.
8.2 Metered Billing Data . All billing data based on metered deliveries to Borough shall be collected by the Electric Metering Device(s) in accordance with Article 5.
8.3 Payments . Unless otherwise specified herein, undisputed payments due under this PPA shall be due and payable by check or ACH payment, as designated by the owed Party, within twenty (20) days of the Borough’s receipt of the invoice. If the due date is not a Business Day, then payment shall be due on the next Business Day. If the amount due is not paid on or before the due date, any undisputed amount remaining unpaid after the due date shall bear an interest rate of one and a half percent (1.5%) per month. If the due date occurs on a Day that is not a Business Day, the late payment charge shall begin to accrue on the next succeeding Business Day.
8.4 Invoice Adjustments and Disputes . Either Party may, in good faith, dispute the correctness of any invoice or any adjustment to an invoice due to arithmetic, computational or meter-related errors within twenty-four months after the date of the invoice or applicable adjustment. All undisputed invoices and adjustments, and portions thereof, shall be paid when due. The Parties shall use good faith efforts to resolve the dispute. If, however, the Parties do not resolve the dispute within thirty (30) days, then the Parties may take any action they deem necessary. Any invoice or adjustment that is not disputed within twenty-four (24) months shall become final.
ARTICLE 9 - OPERATIONS AND MAINTENANCE
9.1 Maintenance Schedule . Seller shall coordinate with the Borough the planned maintenance schedule requirements for the Facility on an annual basis. Specific procedures for scheduling maintenance activities shall be addressed in the Operating Procedures. Seller shall not, during the months of June through September inclusive, schedule any maintenance that reduces the Solar Energy generation of the Facility by more than ten percent (10%), unless (i) such outages are required to avoid damage to the Facility, (ii) such maintenance is necessary to maintain equipment warranties and cannot be scheduled outside the months of June through September, (iii) such maintenance is necessitated by a Force Majeure, or (iv) such maintenance is necessitated by, or permitted by, a curtailment event.
9.2 Facility Operation . Seller, as owner and operator of the Facility and at its own cost and expense, shall be responsible for complying with Good Utility Practices, including all applicable Laws, in operating and maintaining the Facility.
9.3 Energy Production Forecast . Seller shall provide Borough with non-binding annual, monthly, weekly and daily production estimates in hourly detail in a manner that is mutually agreeable. At a minimum, Seller shall provide such data in an electronic spreadsheet format 12 hours prior to the beginning of the reporting period. Any material changes in operating conditions that require modifications to production estimates shall be submitted by 6:30 AM based on the Facility’s local time.
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9.4 Outage and Performance Reporting .
(A) Seller shall comply with all current generating unit outage reporting requirements prescribed in the Borough of Ephrata Technical Requirements for Customer Owned Generation (revised December 8, 2014), as they may be revised from time to time, and as they apply to the Facility.
(B) When Forced Outages occur, Seller shall notify Borough of the existence, nature, and expected duration of the Forced Outage as soon as practical, but in no event, later than twenty-four (24) hours after the Forced Outage occurs. Seller shall promptly inform Borough of changes in the expected duration of the Forced Outage unless relieved of this obligation by Borough for the duration of each Forced Outage.
9.5 Performance Guarantee .
(A) Seller guarantees that over each period of two successive Commercial Operation Years (each, a "Guaranteed Period") beginning on the first anniversary of the Commercial Operation Date, it shall deliver no less than 85% of the Estimated Annual Energy Output equal to the Estimated Annual Energy Outputs listed in Exhibit C incorporated herein, during each such period ("Guaranteed Output"). For the purposes of this Section 9.5, the Estimated Annual Energy Output shall be adjusted to reflect any outages due to Force Majeure, or curtailment by Borough or PPL EU.
(B) In the event that Seller fails to deliver the Guaranteed Output to the Delivery Point over a Guaranteed Period, Seller shall pay positive damages to Borough in an amount equal to the incremental cost in excess of the Solar Energy Payment Rate that Borough reasonably incurred to purchase replacement power in the amount of the shortfall below the Guaranteed Output, plus any fees and costs incurred by the Borough in securing replacement power. Upon the payment of such amount, Seller shall be deemed to have delivered the Guaranteed Output to Seller during each Commercial Operation Year of such Guaranteed Period.
9.6 Operating Committee and Operating Procedures .
(A) Borough and Seller shall each appoint one representative and one alternate representative to act in matters relating to the Parties' performance obligations under this PPA and to develop operating arrangements for the generation, delivery and receipt of Solar Energy hereunder. Such representatives shall constitute the Operating Committee, and shall be specified in Exhibit D. The Parties shall notify each other in writing of such appointments and any changes thereto. The Operating Committee shall have no authority to modify the terms or conditions of this PPA.
(B) Prior to the Commercial Operation Date, the Operating Committee may develop mutually agreeable written Operating Procedures which shall include methods of day-to-day communications; metering, telemetering, telecommunications, and data acquisition procedures; key personnel list for applicable Borough and Seller operating centers; operations and maintenance scheduling and reporting; Solar Energy reports; unit operations log; and such other matters as may be mutually agreed upon by the Parties.
9.7 Access to Facility . Appropriate representatives of Borough shall at all
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reasonable times, and with reasonable prior notice and subject to compliance with Seller's safety and security protocols, have access to the Facility, if necessary, to read and inspect meters.
9.8 Environmental Attri butes
(A) Beginning on COD and until the tenth (10th) anniversary thereof, to the fullest extent allowed by law, Seller shall own and be entitled to claim all Environmental Attributes and Environmental Incentives as they may accrue by virtue of Solar Energy generated by the Facility. Borough shall execute such documents and make such filings as Seller may reasonably request to fulfill the purposes of this Section 9.8(A).
(B) Beginning on the tenth (10th) anniversary of COD, to the fullest extent allowed by law, Borough shall own and be entitled to claim all Environmental Attributes and Environmental Incentives as they may accrue by virtue of Solar Energy generated during the Term and delivered and sold to Borough hereunder. Seller shall execute such documents and make such filings as Borough may reasonably request to fulfill the purposes of this Section 9.8(B).
(C) Notwithstanding the foregoing or anything herein to the contrary, Seller shall be entitled to claim the Tax Credits for the full Term.
ARTICLE 10- DEFAULT AND REMEDIES
10.1 Events of Default of Seller .
(A) Any of the following shall constitute an Event of Default of Seller upon its occurrence and no cure period shall be applicable:
(1) A Bankruptcy Event has occurred with respect to Seller.
(B) Any of the following shall constitute an Event of Default of Seller upon its occurrence but shall be subject to cure within thirty (30) Days after the date of written notice from Borough to Seller and the Facility Lender, after which Borough may terminate this PPA by notice to Seller:
(1) Seller’s Abandonment of the Facility;
(2) Seller's failure to make any payment due to Borough under or in connection with this PPA;
(3) Seller's failure to comply with any other material obligation under this PPA, including Seller’s failure to cause the Facility to produce the Estimated Annual Energy Output, which results in a material adverse impact on Borough.
(4) Any representation or warranty made by Seller in this PPA shall prove to have been false or misleading in any material respect when made or ceases to remain true during the Term if such cessation would reasonably be expected to result in a material adverse impact on Borough.
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10.2 Events of Default of Borough .
(A) Any of the following shall constitute an Event of Default of Borough upon its occurrence and no cure period shall be applicable:
(1) A Bankruptcy Event has occurred with respect to Borough.
(B) Any of the following shall constitute an Event of Default of Borough upon its occurrence but shall be subject to cure within thirty (30) Days after the date of written notice from Seller to Borough, after which Seller may terminate this PPA by notice to Borough:
(1) Borough's failure to make any undisputed payment due hereunder (a "Payment Default").
(2) Borough's failure to comply with any other material obligation under this PPA, which would result in a material adverse impact on Seller.
(3) Any representation or warranty made by Borough in this PPA shall prove to have been false or misleading in any material respect when made or ceases to remain true during the Term if such cessation would reasonably be expected to result in a material adverse impact on Seller.
10.3 Remedies upon Default Generally .
(A) If a Payment Default occurs, Seller may suspend performance of its obligations under this PPA. Further, Seller may pursue any remedy under this PPA, at law or in equity, including an action for damages and termination of this PPA, upon five (5) days prior written notice to Borough following the Payment Default.
(B) On the occurrence of an Event of Default other than a Payment Default, the non-defaulting Party may pursue any remedy under this PPA, at law or in equity, upon five (5) days prior written notice to the defaulting Party following the occurrence of the Event of Default. Nothing herein shall limit either Party's right to collect damages upon the occurrence of a breach or a default by the other Party that does not become an Event of Default.
10.4 Seller Remedies upon Termination for Borough Default . Upon a termination of this PPA by Seller as a result of a default by Borough, Borough shall pay a Termination Payment to Seller determined as follows: the sum of (i) reasonable compensation, on a net after tax basis assuming a tax rate of 35%, for the loss or recapture of (A) the investment tax credit equal to thirty percent (30%) of the Facility value; and (B) MACRS accelerated depreciation equal to eighty five percent (85%) of the Facility value, (C) loss of any Environmental Attributes or Environmental Incentives that accrue or are otherwise assigned to Seller pursuant to the terms of this PPA (Seller shall furnish Borough with a detailed calculation of such compensation if such a claim is made), (D) other financing and associated costs not included in (A), (B) and (C), (ii) the net present value (using a discount rate of 5%) of the projected payments over the Term post-termination, had the Term remained effective for the full Initial Term, and (iii) any and all other amounts previously accrued under this PPA and then owed by Borough to Seller, in each case subject to Seller's
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obligation to mitigate its damages pursuant to Section 10.6. Seller shall provide the Borough with a writing setting forth, in reasonable detail, its calculation of the Termination Payment.
10.5 Borough Remedies upon Termination for Seller Default . Upon a termination of this PPA by Borough as a result of a default by Seller, Seller shall pay a Termination Payment to the Borough determined as follows: the sum of (i) the present value (using a discount rate of 5%) of the excess, if any, of the reasonably expected cost of Solar Energy from the utility over the Solar Energy Payment Rate for the reasonably expected production of the Facility for the remainder of the Initial Term or the then current Additional Term, as applicable; (ii) all costs reasonably incurred by Borough in replacing capacity or other energy benefits, including expected savings in transmission charges from Borough's transmission provider, that would have accrued to Borough upon full performance of this Agreement; and (iii) any and all other amounts previously accrued under this PPA and then owed by Seller to Borough. The Termination Payment shall not be less than zero. Borough shall provide Seller with a writing setting forth, in reasonable detail, its calculation of the Termination Payment.
10.6 Duty to Mitigate Damages. Each Party agrees that it has a duty to mitigate damages and that it will use commercially reasonable efforts to minimize any damages it may incur as a result of the other Party’s performance or non-performance of this Agreement.
10.7 Dispute Resolution . The Parties shall use good faith efforts to resolve any disputes related to the calculation of a Termination Payment pursuant to Article 10.4 or 10.5. If, however, the Parties do not resolve the dispute within thirty (30) days, then the Parties may take any action they deem necessary.
ARTICLE 11 - CONTRACT ADMINISTRATION AND NOTICES
11.1 Notices in Writing . Notices required by this PPA shall be addressed to the other Party, including the other Party's representative on the Operating Committee, at the addresses noted in Exhibit D as either Party updates them from time to time by written notice to the other Party. Any notice, request, consent, or other communication required or authorized under this PPA to be given by one Party to the other Party shall be in writing, and shall either be hand delivered or mailed (or sent via courier), postage prepaid, to the representative of said other Party. If mailed, the notice, request, consent or other communication shall be simultaneously sent by other electronic means. Any such notice, request, consent, or other communication shall be deemed to have been received by the close of the Business Day on which it was hand delivered or transmitted electronically (unless hand delivered or transmitted after such close in which case it shall be deemed received at the close of the next Business Day).
11.2 Representative for Notices . Each Party shall maintain a designated representative to receive notices. Such representative may, at the option of each Party, be the same person as that Party's representative or alternate representative on the Operating Committee, or a different person. Either Party may, by written notice to the other Party, change the representative or the address to which such notices and communications are to be sent
11.3 Authority of Representatives . The Parties' representatives designated above shall have authority to act for its respective principals in all technical matters
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relating to performance of this PPA and to attempt to reso lve disputes o r potential disputes. However, they, in their capacity as representatives, shall not have the authority to amend or modify any provision of this PPA.
11.4 Operating Records . Seller and Borough shall each keep complete and accurate records and all other data required by each of them for the purposes of proper administration of this PPA, including such records as may be required by state or federal regulatory authorities.
11.5 Billing and Payment Records . To facilitate payment and verification, Seller and Borough shall keep all books and records necessary for billing and payments in accordance with the provisions of Article 8 and grant the other Party reasonable access to those records.
11.6 Examination of Records . With reasonable notice, Borough may audit and examine the Seller’s non-privileged financial, operating procedures, equipment manuals, Operating Records and data kept by the Seller relating to transactions under and administration of this PPA, from time to time and during normal business hours.
ARTICLE 12- FORCE MAJEURE
12.1 Definition of Force Majeure.
(A) The term "Force Majeure", as used in this PPA, means causes or events beyond the reasonable control of, and without the fault or negligence of the Party claiming Force Majeure, and which, by the exercise of due diligence the claiming Party is unable to overcome or avoid, including acts of God, vandalism beyond that which could reasonably be prevented by Seller; terrorism; war; riots; fire; explosion; blockades; insurrection; and actions by any Governmental Authority taken after the Effective Date hereof (including Changes in Law), and inability, to obtain Applicable Permits required by any Governmental Authority; but only if such requirements, actions, or failures to act prevent or delay performance of a Party’s obligations under this PPA.
(B) Notwithstanding the foregoing, the term Force Majeure does not include (i) changes in market conditions that affect the cost of supplies, or that affect demand or price for power; or (ii) any labor strikes, slow-downs or stoppages, or other labor disruptions against either Party's contractors or subcontractors.
12.2 Applicability of Force Majeure .
(A) Except as otherwise expressly provided to the contrary in this Agreement, if either Party is rendered wholly or partly unable to timely perform its obligations under this Agreement because of a Force Majeure event, that Party shall be excused from the performance affected by the Force Majeure event (but only to the extent so affected) and the time for performing such excused obligations shall be extended as reasonably necessary; provided, that: (i) the Party affected by such Force Majeure event, as soon as reasonably practicable after obtaining knowledge of the occurrence of the claimed Force Majeure event, gives the other Party prompt oral notice, followed by a written notice reasonably describing the event; (ii) the suspension of or extension of time for performance is of no greater scope and of
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no longer duration than is required by the Force Majeure event; and (iii) the Party affected by such Force Majeure event uses all commercially reasonable efforts to mitigate or remedy its inability to perform as soon as reasonably possible. The Term shall be extended day for day for each day performance is suspended due to a Force Majeure event.
(B) Notwithstanding anything herein to the contrary, the obligation to make any payment due under this Agreement shall not be excused by a Force Majeure event that impacts Borough's ability to make payment.
(C) If a Force Majeure event continues for a period of ninety (90) days (thirty days in the instance of a Change in Law that is a Force Majeure event) or more within a twelve (12) month period and prevents a material part of the performance by a Party hereunder, then the Parties shall, within thirty (30) days following receipt by the other Party of notice of such Force Majeure event, meet and attempt in good faith to negotiate amendments to this Agreement. If the Parties are unable to agree upon such amendments within such thirty (30) day period, then the Party not claiming Force Majeure shall have the right to terminate this Agreement without either Party having further liability to the other Party under this Agreement except with respect to payment of amounts accrued prior to termination and actions or omissions that occur prior to termination.
ARTICLE 13 - REPRESENTATIONS A N D W A R R A N T I E S
13.1 Seller's Representation s and Warranties . Seller hereby represents and warrants as follows:
(A) Seller is a _____ ______ ______ duly organized, validly existing and in good standing under the laws of _______________. Seller has all requisite power and authority to conduct its business, to own its properties, and to execute, deliver, and perform its obligations under this PPA.
(B) The execution, delivery, and performance of its obligations under this PPA by Seller have been duly authorized by all necessary corporate action, and do not and will not:
(1) require any consent or approval by any governing body of Seller, other than that which has been obtained and is in full force and effect (evidence of which shall be delivered to Borough upon its request);
(2) violate any Applicable Law, or violate any provision in any formation documents of Seller, the violation of which could have a material adverse effect on the ability of Seller to perform its obligations under this PPA;
(3) result in a breach or constitute a default· under Seller's formation documents or bylaws, or under any agreement relating to the management or affairs of Seller or any indenture or loan or credit agreement, or any other agreement, lease, or instrument to which Seller is a party or by which Seller or its properties or assets may be bound or affected, the breach or default of which could reasonably be expected to have a material adverse effect on the ability of Seller to perform its obligations under this PPA; or
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(4) result in, or require the creation or imposition of any mortgage, deed of trust, pledge, lien, security interest, or other charge or encumbrance of any nature (other than as may be contemplated by this PPA) upon or with respect to any of the assets or properties of Seller now owned or hereafter acquired, the creation or imposition of which could reasonably be expected to have a material adverse effect on the ability of Seller to perform its obligations under this PPA.
(C) This PPA is a valid and binding obligation of Seller except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other similar laws now or hereafter in effect relating to creditors’ rights generally.
(D) The execution and performance of this PPA will not conflict with or constitute a breach or default under any contract or agreement of any kind to which Seller is a party or any judgment, order, statute or regulation that is applicable to Seller of the Facility.
(E) Seller shall obtain and maintain all permits, consents, approvals, licenses, authorizations, or other action required by any Governmental Authority authorizing Seller's execution, delivery and performance of this PPA pursuant to this PPA and such documents, approvals and authorizations shall remain in full force and effect.
(F) Seller shall comply with all Applicable Laws in effect or that may be enacted during the Term.
(G) Seller shall disclose to Borough, the extent of, and as soon as it is known to Seller, any violation of any Applicable Laws arising out of the construction or operation of the Facility, or the presence of Environmental Contamination at the Facility or on the Site, alleged to exist by any Governmental Authority having jurisdiction over the Site, or the existence of any past or present enforcement, legal, or regulatory action or proceeding relating to such alleged violation or alleged presence of Environmental Contamination. ·
(H) Seller possesses the experience, qualifications, necessary skill, expertise, and financial wherewithal to fulfill its obligations and commitments under this Agreement.
13.2 Borough's Representations and Warranties . Borough hereby represents and warrants as follows:
(A) This PPA is in full force and effect upon its full execution, and such execution by the Borough is within its power and will not violate any Applicable Law.
(B) The execution of this PPA will not:
(1) result in a breach or constitute a default under any agreement, indenture, loan, or credit agreement, or any other agreement, lease, or instrument to which Borough is a party or by which Borough or its properties or assets may be bound or affected, the breach or default of which could reasonably be expected to have a material adverse effect
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on the ability of Borough to perform its obligations under this PPA; or
(2) result in, or require the creation or imposition of, any mortgage, deed of trust, pledge, lien, security interest, or other charge or encumbrance of any nature (other than as may be contemplated by this PPA) upon or with respect to any of the assets or properties of Borough now owned or hereafter acquired, the creation or imposition of which could reasonably be expected to have a material adverse effect on the ability of Borough to perform its obligations under this PPA.
(C) This PPA is a valid and binding obligation of Borough except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other similar laws now or hereafter in effect relating to creditors’ rights generally.
(D) The execution and performance of this PPA will not conflict with or constitute a breach or default under any contract or agreement of any kind to which Borough is a party or any judgment, order, statute, or regulation that is applicable to Borough.
(E) All approvals, authorizations, consents, or other action required by Borough to authorize Borough’s execution, delivery and performance of this PPA, have been duly obtained and are in full force and effect.
(F) Borough shall comply with all Applicable Laws in effect or that may be enacted during the Term.
ARTICLE 14 – PURCHASE OPTION
14.1 Grant of Purchase Option . Seller hereby grants to Borough the option to purchase the Facility ("Purchase Option") on the tenth (10th) and fifteen (15th) anniversaries of the Commercial Operation Date and at the end of the Term. Borough must provide a notification to Seller of its intent to purchase at least ninety (90) days and not more than one hundred eighty (180) days prior to the end of the applicable anniversary. The Parties will arrange the sale under customary terms and conditions for the purchase and sale of a facility of this type and size, which terms and conditions shall provide, among other things, that (i) Seller shall transfer good title to the Facility to Borough upon Seller's receipt of the purchase price, but otherwise disclaims all warranties of any kind, express or implied, concerning the Facility, "as is, where is, with all faults"; (ii) Seller shall assign to Borough any manufacturers’ warranties that are in effect as of the purchase date, and which are assignable pursuant to their terms; and (iii) upon such transfer of title, this PPA shall terminate automatically. Upon purchase of the Facility, Borough will assume complete responsibility for the operation and maintenance of the Facility, as well as liability for the performance of the Facility and for the related real estate obligations, if any, with respect to the Site, and Seller shall have no further liabilities of obligations hereunder. Seller shall cooperate with Borough in connection with any such sale, including responding to due diligence requests and seeking any necessary approvals, provided that such cooperation shall not require Seller to incur any material out-of-pocket costs unless such costs are reimbursed by Borough.
14.2 Purchase Price. The purchase price will be equal to the Fair Market Value of the Facility. The “Fair Market Value” of the Facility shall be determined by mutual agreement of Borough and Seller; provided, however, if Borough and Seller cannot agree to a Fair Market
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Value within thirty (30) days after Borough has exercised its option, the Parties shall select a nationally recognized independent appraiser with experience and expertise in the solar photovoltaic industry to determine the Fair Market Value of the Facility. Such appraiser shall act reasonably and in good faith to determine the Fair Market Value of the Facility on an installed basis and shall set forth such determination in a written opinion delivered to the Parties. The valuation made by the appraiser shall be binding upon the Parties in the absence of fraud or manifest error. The costs of the appraisal shall be borne by the Parties equally. If the Parties are unable to agree on the selection of an appraiser, the appraiser shall be selected jointly by an appraiser selected by the Seller and an appraiser selected by Borough.
14.3 Removal of Facility. Unless purchased by the Borough, Seller will remove the Facility at the end of the Term or upon termination of the Agreement and return the Site to its pre-installation condition. Seller shall, at Seller’s sole cost and expense, repair any damage to the Site caused by the installation of the Facility, the operation of the Facility, or Seller’s removal of the Facility.
ARTICLE 15 – INSURANCE
15.1 Seller Insurance . Seller shall obtain and maintain the insurance coverages described in Exhibit E. Seller shall, annually or on upon request of Borough, provide Borough with certificates of insurance.
15.2 Borough’s Insurance . Borough shall be responsible for purchasing and maintaining the Borough’s usual liability insurance or group self-insurance, or solely at the Borough’s option, the Borough may self-insure the Borough’s liability exposures.
ARTICLE 16 - INDEMNITY
16.1 Seller (the "Indemnifying Party ") agrees to indemnify, defend and hold harmless the Borough (the "Indemnified Party ") from and against all third party claims, demands, losses, liabilities, penalties, and expenses (including reasonable attorneys' fees) for personal injury or death to persons and damage to the Indemnified Party's real property and tangible personal property or facilities or the property of any other person or entity to the extent arising out of, resulting from, or caused by a breach by Indemnifying Party of its obligations under this PPA, violation of any Applicable Laws, or by the negligent or tortious acts, errors, or omissions of the Indemnifying Party, its Affiliates, its directors, officers, employees, subcontractors, or agents. This indemnification obligation shall apply notwithstanding any negligent or intentional acts, errors or omissions of the Indemnified Party, but the Indemnifying Party's liability to pay damages to the Indemnified Party shall be reduced in proportion to the percentage by which the Indemnified Party's negligent or intentional acts, errors or omissions caused the damages. Neither Party shall be indemnified for its damages resulting from its sole negligence, intentional acts or willful misconduct. These indemnity provisions shall not be construed to relieve any insurer of its obligation to pay claims consistent with the provisions of a valid insurance policy.
16.2 Promptly after receipt by the Indemnified Party of any claim or notice of the commencement of any action, administrative, or legal proceeding, or investigation as to which the indemnity provided for in this Article may apply, the Indemnified Party shall notify
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the Indemnifying Party in writing of such fact. The Indemnifying Party shall assume the defense thereof with counsel designated by such Party and satisfactory to the Indemnified Party, provided, however, that if the defendants in any such action include both the Indemnified Party and the Indemnifying Party and the Indemnified Party shall have reasonably concluded that there may be legal defenses available to it which are different from or additional to, or inconsistent with, those available to the Indemnifying Party, the Indemnified Party shall have the right to select and be represented by separate counsel, at the Indemnifying Party's expense, unless a liability insurer is willing to pay such costs.
16.3 If the Indemnifying Party fails to assume the defense of a claim meriting indemnification, the Indemnified Party, at the expense of the Indemnifying Party, may contest, settle, or pay such claim, provided that settlement or full payment of any such claim may be made only following consent of the Indemnifying Party or, absent such consent, written opinion of the Indemnified Party's counsel that such claim is meritorious or warrants settlement.
16.4 Except with respect to indemnification of third party claims pursuant to Section 16, neither Party nor its directors, officers, shareholders, partners, members, agents and employees, subcontractors or suppliers shall be liable for any indirect, special, incidental, exemplary, or consequential loss or damage of any nature arising out of their performance or non-performance hereunder.
ARTICLE 17 – ASSIGNMENT
17.1 No Assignment Without Consent .
(A) This PPA may not be assigned in whole or in part by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld, conditioned, or delayed.
(B) Notwithstanding 17.1(A), Seller may, without the prior written consent of Borough, assign, mortgage, pledge or otherwise directly or indirectly assign its interests in this PPA to any Facility Lender, any entity through which Seller is obtaining financing from a Facility Lender.
(C) This PPA shall be binding on and inure to the benefit of the successors and permitted assignees.
17.2 Accommodation of Facility Lender . To facilitate Seller's obtaining of financing to construct and operate the Facility, Borough shall make commercially reasonable efforts to provide such consents to collateral assignment, certifications, representations, information or other documents as may be commercially reasonably requested by Seller or the Facility Lender in connection with the financing of the Facility (generally, a "Lender Consent"). The Lender Consent shall include such customary terms as the Facility Lender may reasonably request that do not adversely affect any of Borough's rights, benefits, risks and/or obligations under this PPA. Seller shall reimburse Borough’s costs in complying with this section 17.2.
ARTICLE 18 – MISCELLANEOUS
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18.1 Waiver . The failure of either Party to enforce or insist upon compliance with or strict performance of any of the terms or conditions of this PPA, or to take advantage of any of its rights thereunder, shall not constitute a waiver or relinquishment of any such terms, conditions, or rights, but the same shall be and remain at all times in full force and effect.
18.2 Taxes .
(A) Each Party will be responsible for and pay any taxes that may be imposed on it in connection with its respective obligations under this PPA. Without limiting the foregoing, Seller shall be responsible for any income taxes or similar taxes imposed on Seller’s revenues due to the sale of Solar Energy under this PPA. Seller shall be responsible for any property taxes on the Facility, and the Borough shall be responsible for any property taxes on the Site. If taxes on personal property are ever imposed, Seller also shall pay any and all personal property taxes relating to the Facility.
(B) The Parties shall cooperate to minimize tax exposure; however, neither Party shall be obligated to incur any financial burden to reduce taxes for which the other Party is responsible hereunder.
18.3 Rate Changes . The terms and conditions and the rates for service specified in this PPA shall remain in effect for the term of the transaction described herein. Absent the agreement of all parties to the proposed change, the standard of review for changes to this contract proposed by a party, a non-party or the FERC, acting sua sponte shall be the “public interest” application of the “just and reasonable” standard of review set forth in the United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956), and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956) (the “Mobile-Sierra” doctrine).
1 8 . 4 Service Contract. The Parties acknowledge and agree that, for accounting and tax purposes, this Agreement is not and shall be construed as a capital lease and, pursuant to Section 7701(e)(3) of the Internal Revenue Code, this PPA is and shall be deemed to be a service contract.
18.5 No Third Party Beneficiaries . Nothing in this PPA shall be construed to create any duty to, or standard of care with reference to, or any liability to, any person not a party to this PPA.
18.6 Relationship of the Parties .
(A) This PPA shall not be interpreted to create an association, joint venture, or partnership between the Parties nor to impose any partnership obligation or liability upon either Party.
(B) Seller shall be solely liable for the payment of all wages, taxes, and other costs related to the employment of persons to perform any services required to fulfill Seller’s obligations under the PPA, including all federal, state, and local income, social security, payroll, and employment taxes and statutorily mandated workers' compensation coverage. None of the persons employed by Seller shall be considered employees of Borough for any purpose; nor shall Seller represent to any person that he or she is or shall become a
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Borough employee.
18.7 Survival of Obligations . Cancellation, expiration, or earlier termination of this PPA shall not relieve the Parties of obligations that by their nature should survive such cancellation, expiration, or termination, prior to the term of the applicable.
18.8 Severability . In the event any of the terms, covenants, or conditions of this PPA, its Exhibits, or the application of any such terms, covenants, or conditions, shall be held invalid, illegal, or unenforceable by any court or administrative body having jurisdiction, all other terms, covenants, and conditions of the PPA and their application not adversely affected thereby shall remain in force and effect; provided, however, that Borough and Seller shall negotiate in good faith to attempt to implement an equitable adjustment in the provisions of this PPA with a view toward effecting the purposes of this PPA by replacing the provision that is held invalid, illegal, or unenforceable with a valid provision the economic effect of which comes as close as possible to that of the provision that has been found to be invalid, illegal or unenforceable.
18.9 Complete Agreement: Amendments . The terms and provisions contained in this PPA constitute the entire agreement between Borough and Seller with respect to the Facility and shall supersede all previous communications, representations, or agreements, either verbal or written, between Borough and Seller with respect to the subject matter herein. This PPA may be amended, changed, modified, or altered, provided that such amendment, change, modification, or alteration shall be in writing and signed by both Parties hereto.
18.10 Headings. Captions and headings used in this PPA are for ease of reference only and do not constitute a part of this PPA.
18.11 Counterparts . This PPA may be executed in any number of counterparts, and each executed counterpart shall have the same force and effect as an original instrument.
18.12 Governing Law: Disputes . This Agreement and the performance thereof shall be governed by and enforced under the laws of the Commonwealth of Pennsylvania, and if legal action by either Party is necessary for or with respect to the enforcement of any or all of the terms and conditions hereof, then exclusive venue therefore shall lie in the Borough of Ephrata, Pennsylvania. Each Party shall be responsible for its own attorney’s fees and costs.
18.13 Press Releases and Media Contact . Upon the request of either Party, the Parties shall develop a mutually agreed joint press release to be issued describing the location, size, type and timing of the Facility, the long-term nature of this PPA, and other relevant factual information about the relationship. In the event during the Term, either Party is contacted by the media concerning this PPA or the Facility, the contacted Party shall notify the other Party promptly and shall consult and cooperate with the other Party before responding to such media inquiry.
18.14 Forward Contract . The Parties intend that the transaction contemplated under this PPA constitutes a "forward contract" within the meaning of the United States Bankruptcy Code, and the Parties further believe that each Party is a "forward contract merchant" within the meaning of the United States Bankruptcy Code. To the extent a court of competent jurisdiction finds that one or more of the Parties is not a Forward Contract Merchant
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or that this agreement is not a Forward Contract, the prior sentence shall not apply.
18.15 Non-Dedication of Facilities . Nothing herein shall be construed as the dedication by either Party of its facilities or equipment to the public or any part thereof. Neither Party shall knowingly take any action that would subject the other Party, or other Party's facilities or equipment, to the jurisdiction of any Governmental Authority as a public utility or similar entity. Neither Party shall assert in any proceeding before a court or regulatory body that the other Party is a public utility by virtue of such other Party's performance under this PPA. If Seller is reasonably likely to become subject to regulation as a public utility, then the Parties shall use all reasonable efforts to restructure their relationship under this PPA in a manner that preserves their relative economic interests while ensuring that Seller does not become subject to any such regulation. If the Parties are unable to agree upon such restructuring, Seller shall have the right to terminate this PPA without further liability.
18.16 Confidentiality . All non-public information provided by either Party to the other or that is identified by the disclosing Party in writing as confidential or proprietary shall be treated in a confidential manner and shall not be disclosed to any third party without the prior written consent of the disclosing Party, which consent shall not be unreasonably withheld. However, this Section 18.16 and the restrictions herein contained shall not apply to any data or information that is either required to be disclosed pursuant to Applicable Law or an order or requirements of a regulatory body or court, publicly available other than as a result of unauthorized disclosure by the Party having the duty of confidentiality. For the avoidance of doubt, nothing herein shall prevent or penalize the Borough from disclosing any information defined herein as confidential or proprietary when the Borough, in its sole discretion, determines that such disclosure is required by Applicable Law, including but not limited to the Pennsylvania Right-to-Know Law (65 P.S. § 67.101 et. seq.) and the Pennsylvania Sunshine Act (65 Pa. C.S.A. § 701 et. seq. as amended).
18.17 Imaged Documents . Any document generated by the Parties with respect to this Agreement, including this Agreement, may be imaged and stored electronically. Imaged Documents may be introduced as evidence in any proceeding as if such were original business records, and neither Party shall contest the admissibility of Imaged Documents as evidence in any proceeding.
[Signature Page(s) follows.]
IN WITNESS, WHEREOF, the Parties have executed this PPA as of the date first written above.
[Seller]
By: __________________
Name:
Title:
Borough of Ephrata, PA
By: __________________
Name:
Title:
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Exhibits
Exhibit A Construction Milestones
Exhibit B Facility and Site Description
Exhibit C Estimated Annual Energy Output
Exhibit D Operating Committee
Exhibit E Insurance
Exhibit F PPL Requirements
Exhibit G Lease Agreement
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Exhibit AConstruction Milestones
All Permits Complete
Notice to Proceed
Construction Start Date
Guaranteed Commercial Operation Date
Commercial Operation Date
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Exhibit B
Facility Description
The Facility is comprised of the Seller’s photovoltaic (“PV”) solar electric generating facility to be installed at the Site and includes all associated equipment owned by the Seller, including interconnection facilities, solar panels, mounting substrates or supports, wiring and connections, power inverters, switching equipment, and metering equipment that may be necessary to connect such power generating equipment to the Borough’s Delivery Line and to supply electricity to the Borough. The Facility also will include maintenance roads throughout the PV system, an on-site spare equipment storage and telecommunications facility in accordance with standard operations and maintenance requirements.
The Facility does not include the Site on which the Facility is constructed or the Delivery Line constructed by the Borough to interconnect the Facility with the Borough’s electric distribution system. The Site and the Delivery Line are owned by the Borough.
The Facility is described as a behind-the-meter PV solar system with solar panels meeting all current UL listing requirements, central inverters and electrical collection system meeting all current UL listing requirements and a single-axis tracker racking structure that will track the sun from east to west daily. The Facility complies with PPL EU requirements regarding anti-islanding and electrical worker safety that are set forth in Exhibit F.
Consistent with PJM Interconnection, L.L.C.’s (“PJM”) Manual 14A, Revision 19, November 1, 2016, or latest edition, the Facility shall be behind-the-meter generation (one or more generating units that are located with load at a single electrical location such that no transmission or distribution facilities owned or operated by any transmission owner or electric distributor other than the Borough are used to deliver energy from the generating unit(s) to the load. At any time, no portion of such generating unit(s)’ capacity shall be designated as a Capacity Resource nor shall any portion of the output of the generating unit(s) be sold to another entity for consumption or into the PJM Interchange Energy Market.
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Site Description
The Site is located on existing cultivated fields located both north and south of Springhouse Road between North Reading Road and East Trout Run Road, in Ephrata, Lancaster County, Pennsylvania. At the time of the Agreement’s execution, the Site consists of agricultural fields that surround a wastewater treatment plant and a Pennsylvania State Police facility. Topography varies little across the Site. Parcel data is included below:
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A satellite view and survey of the Site are show below:
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Exhibit CEstimated Annual Energy Output
Commercial Operation
Year
Estimated Annual Energy Output -
MWh*
12345678910111213141516171819202122232425
* reflects .005 annual degradation factor
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Exhibit D
Operating Committee
Borough SellerPrimary Representative:
Tom NatarianDirector of Operations Borough of Ephrata, PA
Via hand delivery:
Via overnight service:
Phone: Email:
Primary Representative:
Via hand delivery:
Via overnight service:
Phone: Email:
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Exhibit E
Insurance Requirements
1 - General Insurance Requirements
1.1 - The Seller and Seller’s contractors shall not commence use, occupancy or maintenance of the Site or construction on the Site until the Seller and Seller’s contractors have obtained at their own expense all of the insurance as required hereunder and such insurance has been approved by the Borough; nor shall the Seller allow any contractor to commence work on the Site until all insurance required of the contractor has been so obtained and approved by the Seller. Approval of insurance required of the Seller will be granted only after submission to the Borough of original certificates of insurance signed by authorized representatives of the insurers or, at the Borough's request, certified copies of the required insurance policies.
1.2 - Insurance as required hereunder shall be in force throughout the term of the Agreement. Original certificates signed by authorized representatives of the insurers or, at the Borough's request, certified copies of insurance policies, evidencing that the required insurance is in effect, shall be maintained with the Borough throughout the term of the Agreement.
1.3 - The Seller shall require all of its contractors to maintain during the term of the Agreement commercial general liability insurance, business auto liability insurance, and workers compensation and employers liability insurance to the same extent required of the Seller in 3.1.1, 3.1.2, and 3.1.3 of this Exhibit E unless any such requirement is expressly waived or amended by the Borough in writing. The Seller shall furnish any contractor’s certificate(s) of insurance to the Borough immediately upon request.
1.4 - No acceptance and/or approval of any insurance by the Borough shall be construed as relieving or excusing the Seller from any liability or obligation imposed upon Seller by the provisions of this Agreement.
1.5 - If the Seller does not meet the insurance requirements of this Agreement, the Seller shall forward a written request to the Borough for a waiver in writing of the insurance requirement(s) not met or approval in writing of alternate insurance coverage, self-insurance, or group self-insurance arrangements. If the Borough denies the request, the Seller must comply with the insurance requirements as specified in this Agreement.
1.6 - All required insurance coverages must be underwritten by insurers allowed to do business in the Commonwealth of Pennsylvania and acceptable to the Borough. The insurers must also have a policyholders' rating of "A-" or better, and a financial size of "Class VII" or better in the latest evaluation by A. M. Best Company, unless Borough grants specific approval for an exception. The Borough hereby grants specific approval for the acquisition of workers compensation and employers liability insurance from the State Workers’ Insurance Fund (SWIF) of Pennsylvania.
1.7 - Any deductibles or retentions in excess of $10,000 shall be disclosed by the Seller, and are subject to Borough's written approval. Any deductible or retention amounts elected by the Seller or imposed by the Seller's insurer(s) shall be the sole responsibility of the Seller.
1.8 - If the Borough is damaged by the failure or neglect of the Seller to purchase and maintain insurance as described and required herein, without so notifying the Borough, then the
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Seller shall bear all reasonable costs properly attributable thereto.
2 - Seller's Liability Insurance (Occurrence Basis)
2.1 - The Seller shall purchase and maintain the following insurance coverages which shall be written on an occurrence basis for not less than the limits specified below or required by law, whichever is greater.
2.1.1 - Commercial general liability insurance or its equivalent for bodily injury, personal injury and property damage including loss of use, with minimum limits of:
$ 1,000,000 each occurrence;$ 1,000,000 personal and advertising injury;$ 2,000,000 general aggregate; and$ 2,000,000 products/completed operations aggregate.
This insurance shall include coverage for all of the following:
i. Liability arising from premises and operations;ii. Liability arising from the actions of independent contractors;iii. Liability arising from products and completed operations;iv. Contractual liability including protection for the Seller from bodily injury and
property damage claims arising out of liability assumed under this Agreement; and
v. Liability arising from the explosion, collapse, or underground (XCU) hazards.
2.1.2 - Business auto liability insurance or its equivalent with a minimum limit of $1,000,000 per accident and including coverage for all of the following:
i. Liability arising out of the ownership, maintenance or use of any auto (if no owned autos, then hired and non-owned autos); and
ii. Automobile contractual liability.
2.1.3 - Workers compensation insurance or its equivalent with statutory benefits as required by any state or Federal law, including standard "other states" coverage; employers liability insurance or its equivalent with minimum limits of:
$ 100,000 each accident for bodily injury by accident;$ 100,000 each employee for bodily injury by disease; and$ 500,000 policy limit for bodily injury by disease.
2.1.4 - Umbrella excess liability or excess liability insurance or its equivalent with minimum limits of:
$ 2,000,000 per occurrence;$ 2,000,000 aggregate for other than products/completed operations and auto
liability; and$ 2,000,000 products/completed operations aggregate
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and including all of the following coverages on the applicable schedule of underlying insurance:
i. Commercial general liability;ii. Business auto liability; andiii. Employers liability.
2.1.5 – The Borough and its elected and appointed officials, officers and employees shall be named as additional insureds on the Seller's commercial general liability insurance and umbrella excess or excess liability insurance policies with respect to liability arising out of the Seller's use, occupancy and maintenance of the Site or its products, installation, and/or services provided under this Agreement.
2.1.6 - Insurance or self-insurance provided to Borough and its elected and appointed officials, officers and employees under any Seller's liability insurance or self-insurance required herein, including, but not limited to, umbrella and excess liability or excess liability policies, shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of insurance or self-insurance. (Any cross suits or cross liability exclusion shall be deleted from Seller's liability insurance policies required herein.)
2.1.8 - Insurance or self-insurance provided to Borough and its elected and appointed officials, officers and employees as specified herein shall be primary, and any other insurance, self-insurance, coverage or indemnity available to Borough and its elected and appointed officials, officers and employees shall be excess of and non-contributory with insurance or self-insurance provided to Borough and its elected and appointed officials, officers and employees as specified herein.
3 - Seller's Property and Equipment Breakdown Insurance
3.1 - Seller shall purchase and maintain, at its own expense, all risk (special form) property insurance which insures against direct physical loss of or damage to Seller’s buildings and structures, business personal property, fixtures and equipment, including but not limited to solar panels, inverters, transformers, and other electrical equipment, located in, on or at the Site, on a replacement cost valuation basis, with limits not less than 100% of the insurable replacement cost of all such property located in, on or at the Site. Any deductible amount(s) selected by Seller or imposed by Seller’s insurer(s) shall be the sole responsibility of Seller.
3.2 Seller shall purchase and maintain, at its own expense, equipment breakdown (boiler and machinery) insurance which insures against direct physical loss of or damage to Seller’s buildings and structures, business personal property, fixtures and equipment, including but not limited to solar panels, inverters, transformers, and other electrical equipment, located in, on or at the Site, on a replacement cost valuation basis, with limits not less than 100% of the insurable replacement cost of all such property located in, on or at the Site. Any deductible amount(s) selected by Seller or imposed by Seller’s insurer(s) shall be the sole responsibility of Seller.
3.3 The Seller and its contractors hereby waive all rights of recovery against the Borough
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and its elected and appointed officials, officers and employees for property damage to or loss of use of Seller’s buildings and structures, business personal property, fixtures and equipment, including but not limited to solar panels, inverters, transformers, and other electrical equipment, located in, on or at the Site, regardless of whether such property damage or loss of use is covered by property insurance maintained by the Seller and its contractors. This waiver shall apply regardless of the cause of origin, including the negligence of the Borough. To the fullest extent permitted by law, no property insurer of the Seller or its contractors shall hold any right of subrogation against the Borough and its elected and appointed officials, officers and employees as respects loss or damage occurring in, on or at the Site. Any property insurance maintained by the Seller or its contractors shall permit such waivers of recovery by waiver of subrogation endorsement or otherwise.
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Exhibit F
PPL EU Relay and Control Requirements for Parallel Operation of Generation
The transmission provider to the Borough is Pennsylvania Power and Light Electric Utilities or “PPL EU”. Per PPL EU RELAY AND CONTROL REQUIREMENTS FOR PARALLEL OPERATION OF GENERATION, PG-0000-006-PE-ENG Revision: 17 Effective Date: 3/20/17, or latest edition, specific operating criteria have been established for the Facility. Based on previous submissions to PPL EU, PPL EU has determined that the installation will be a “TYPE 6” installation, characterized as three phase, any voltage level, campus or facility type installation, with no intentional power flow into the PPL EU system. When reverse flow is detected, a suitable device(s) shall operate to immediately remove the generation from the Borough system.
As a condition of PPL EU approving the project, the Seller is required to submit one line diagrams and supporting documentation showing in sufficient detail system protection including islanding protection. Submission shall identify which devices will operate, and the locations of the various sensing components (CTs, PTs, and the relaying). All submissions shall be made directly to the Borough, who shall interface with PPL EU for approvals.
Integrated Generation System Protection
General
The Seller shall be responsible for any and all system protection to meet PPL EU requirements including but not limited to specifications as outlined in PPL EU RELAY AND CONTROL REQUIREMENTS FOR PARALLEL OPERATION OF GENERATION, PG-0000-006-PE-ENG Revision:17 Effective Date: 3/20/17, or latest edition.
The Seller shall provide an integrated protective scheme, acceptable to both the Borough and PPL EU that will provide the protective functions specified in IEEE 1547 and UL 1741. Protection scheme shall be applicable for individual inverters and the entire integrated installation operating as one Facility. Seller shall submit protection scheme in sufficient design detail to the Borough for approval by Borough and forwarding to PPL EU by Borough for PPL EU review and acceptance.
Addressing that concern, proposed equipment and the integrated system design shall be compliant with all PPL EU protection and anti-islanding requirements. System protection and the integrated system anti-islanding protection shall be subject to approval of PPL EU.
The Borough and PPL EU recognize that individual components of installations for the proposed generation can be anti-islanding protection compliant with both IEEE 1547 and UL 1741. Generally, for a single inverter installation, the generation protection functions to immediately disconnect a single generator in the event of the loss the generation feeder in the event of a PPL EU 69 kV transmission outage. However, for the loss of either the Borough Delivery Line or the incoming PPL EU transmission lines serving the Borough, the Seller generation protection will immediately remove the generation from the Borough system. With
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the anti-islanding protection installed, there shall be no back feed into either the Borough system or into the PPL EU system.
Since the Seller will likely have more than one (1) inverter and, likely, will have three (3) inverters, in the absence of a PPL EU generated 60 Hz frequency, PPL EU maintains that it is possible for two (2) or more inverters to sense the other’s generated 60 Hz frequency, thereby maintaining generation and not disconnecting. Per PPL EU, this is the basis for the Section 5.1.4 of PPL EU Parallel Generation Protection Requirements stepped up review with additional PPL EU requirements including external Intertie Protective Relaying (IPR) protection.
Submittals shall include a one line drawing showing the location of instrument transformers (current and voltage) and the location of the relays, breakers and fuses, specific anti-island protection to be applied to the system and specific grouped anti-islanding protection of the system. Provide specific details on the integrated system anti-islanding protection including manufacturer and model number of each type of device and all relaying.
The submissions shall include details of the anti-islanding provisions of the integrated generation system design acceptable to both Borough and PPL EU. In no event will the Facility be accepted absent acceptance of protection and anti-islanding protection by both the Borough and PPL EU.
Depending on the nature and strength of Seller’s system protection submission including islanding protection, and additionally based on PPL EU approval and mandated additional requirements, the lack of PPL EU approved islanding protection, can and will result in additional required equipment, relaying and protection requirements to be provided by the Seller. Additional equipment may be required at the discretion of PPL EU up to and including two sets of 69 kV substation fused potential transformers for transmission line sensing and associated relaying. PPL EU acceptance of Facility Generation Protection including Islanding will mandate any additional required protection for the Facility.
PPL EU Network Islanding Compliance
PPL EU has expressed concern for islanding protection in the multiple application of generators and inverters for a condition of the loss of both incoming PPL EU transmission 69 kV service feeds to the Borough. Specifically, since the currently proposed system has multiple, likely three (3) inverters, in the absence of a PPL EU generated 60 Hz frequency, it would be possible for two (2) or more inverters to sense each other’s generated 60 Hz frequency, thereby maintaining generation and not disconnecting.
PPL EU will require that primary and backup relaying will be provided such that the failure of one device will allow continued operation of the Facility until the failure can be repaired.
PPL EU will require PPL EU review of the final relay and control drawings and settings before the Seller proceeds with installation of their design. This includes the Intertie Protective Relay Cabinet drawings, specific relays and equipment and generation specification sheets.
Absent approved islanding protection, Seller shall provide and install PPL EU mandated protection and required associated equipment. Protection devices to be used to isolate the generation and system shall be subject to PPL EU approval.
Depending on the approval submission, PPL EU system, reserves the right, as transmission
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provider, to require additional protection and associated equipment by Seller. Based on a previous project approval submission to PPL EU, not including PPL EU approved islanding protection, the PPL EU method of accommodation may require the reverse power, rate of change of frequency and rate of change voltage protection relaying by Seller.
Since the Seller design intent, configuration, and generation capacity may materially change from the original submission, a resubmission will be required for PPL EU to evaluate the impact of any changes.
For a Type 6 design, the Seller provided Intertie Protective Relay cabinet must have a reverse power function that will be used to remove Seller generators by tripping the substation Facility feeder breaker should the generation flow onto the PPL EU system. Per PPL EU, this will require a relay to monitor each of the incoming PPL EU feeds into the Facility to detect the flow of power onto PPL EU transmission lines. The reverse power relay settings shall be determined by the Seller. Seller and PPL EU will review the settings to determine acceptability.
Seller shall be responsible, if required by PPL EU, for relaying and associated equipment including fused PTs to be installed on the high side of the 69 kV breakers to provide voltage to the IPR relays. Per PPL EU, this will be to detect the loss of the 69 kV transmission lines and ensure the generator feeder 15 kV breaker is open before the PPL EU 69 kV service is restored. This will prevent reclosing of the 69 kV system out of phase with the generators which could result in significant damage to the generator.
Proprietary Technology
The Borough recognizes the proprietary nature of manufacturer specific anti-islanding controls. Notwithstanding proprietary claims, Seller shall submit for approval anti-islanding protection details in sufficient detail for Borough and PPL EU approval. Submission shall demonstrate that the integrated system, not limited to individual system components, shall meet the anti-islanding requirements of PPL EU.
Seller shall show to the satisfaction of both PPL EU and the Borough that the anti-islanding controls proposed for the integrated system are compliant with PPL EU requirements. The protective scheme shall be applicable to both all individual equipment components, and the integrated networked grouping of the multiple generators and equipment subject to change based on the proposal of Seller at the mutual discretion of the Seller and Borough.
Bank Breaker Relaying
Seller shall provide 15 kV protection at existing Borough, 15 kV secondary transformer bank circuit breakers to detect and trip the substation bank circuit breaker(s) for any power flow back into the PPL EU system. Upon detection of reverse flow (reverse current back into the PPL EU system), relaying shall operate to trip the bank circuit breaker. Sensing potential shall be from a set of three potential transformers located between the substation power transformer and bank circuit breaker.
Per PPL EU RELAY AND CONTROL REQUIREMENTS FOR PARALLEL OPERATION OF GENERATION, PG-0000-006-PE-ENG Revision:17 Effective Date: 3/20/17, or latest edition. Subject to specific equipment provided, Seller shall provide, as a minimum, required relaying shown for a PPL EU Type 4 installation. Protection, while based on current PPL EU
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information, is subject to change by PPL EU. Final protection requirements, including anti-islanding protection is subject to Borough and PPL EU approval.
Depending on the nature and strength of Seller’s system protection submission including islanding protection, and additionally based on PPL EU approval and mandated additional requirements, the lack of PPL EU approved islanding protection, can and will result in additional equipment, relaying and protection requirements to be provided by the Seller. Based on PPL EU communications, to date, the following protection may likely be required as a minimum.
Feeder Generation Breaker Relaying
Seller shall provide 15 kV protection at existing Borough, 15 kV substation generation feeder breaker to detect and trip the feeder breaker for loss of the incoming PPL EU Transmission lines. Upon detection of loss of source voltage to the feeder and resulting feeder outage, the relaying will operate to immediately open the generation feeder breaker and remove the generation from the system. Sensing potential shall be from the existing two sets of bus potential transformers installed at the substation main busses 1 and 2.
Per PPL EU RELAY AND CONTROL REQUIREMENTS FOR PARALLEL OPERATION OF GENERATION, PG-0000-006-PE-ENG Revision:17 Effective Date: 3/20/17, or latest edition. Subject to specific equipment provided, Seller shall provide, as a minimum, required relaying shown for a PPL EU Type 2 installation. Protection, while based on current PPL EU information, is subject to change by PPL EU. Final protection requirements, including anti-islanding protection is subject to Borough and PPL EU approval.
Depending on the nature and strength of Seller’s system protection submission including islanding protection, and additionally based on PPL EU approval and mandated additional requirements, the lack of PPL EU approved islanding protection, can and will result in additional equipment, relaying and protection requirements to be provided by the Seller. Based on PPL EU communications, to date, the following protection may likely be required as a minimum.
Seller Facility Point of Contact Relaying
Seller shall provide 15 kV vacuum circuit recloser at Facility as Seller point of contact protection.
Provide NEMA 4X panel with relay providing the required functions. having the following functions.
Per PPL EU RELAY AND CONTROL REQUIREMENTS FOR PARALLEL OPERATION OF GENERATION, PG-0000-006-PE-ENG Revision:17 Effective Date: 3/20/17, or latest edition. Subject to specific equipment provided, Seller shall provide, as a minimum, required relaying shown for a PPL EU Type 2 installation. Protection, while based on current PPL EU information, is subject to change by PPL EU. Final protection requirements, including anti-islanding protection is subject to Borough and PPL EU approval.
Depending on the nature and strength of Seller’s system protection submission including islanding protection, and additionally based on PPL EU approval and mandated additional requirements, the lack of PPL EU approved islanding protection, can and will result in
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additional equipment, relaying and protection requirements to be provided by the Seller. Based on PPL EU communications, to date, the following protection may likely be required as a minimum.
Facility and Islanding Protection
Provide integrated system protection to detect and isolate system faults maintaining the security and the stability of the system. Protected abnormal conditions shall include but not be limited to effects of short circuits, over frequency, over voltages, unbalanced currents, over/under frequency.
Protection requirements shall be selective and respond only to adverse events within zones of protection, faults seen by the generator system, feeder, loss of incoming power source mains, upstream feeder opening and islanding.
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Exhibit G
Lease Agreement
THIS LEASE AGREEMENT (this “Lease”) is made and entered into on this _______ day of ________________, 2017 (the “Effective Date”) by and between the BOROUGH OF EPHRATA, PENNSYLVANIA, a Pennsylvania municipal corporation (“Landlord”) and __________________________, a _______________________ (“Tenant”). Landlord and Tenant are hereinafter referred to individually as a “Party” and collectively as the “Parties”.
B A C K G R O U N D:
A. Landlord is the owner of those certain undeveloped parcels of land located on the north and south sides of Springhouse Road between North Reading Road and East Trout Run Road in Ephrata Township, Lancaster County, Pennsylvania, having addresses of 18 East Trout Road and 21 Springhouse Road, and being known as Lancaster County Tax Parcel Numbers 270-00330 and 270-42620 (collectively, the “Site”);
B. In connection with that certain Solar Energy Power Purchase Agreement of even date herewith between Landlord and Tenant (the “PPA”), Tenant desires to lease the Site for purposes of developing, designing, constructing, owning, operating and maintaining a solar electric generating facility (the “Facility”) thereon; and
C. Landlord and Tenant now desire to enter into this Lease in accordance with the terms and conditions hereunder.
NOW, THEREFORE, in consideration of the mutual covenants contained herein, and intending to be legally bound hereby, Landlord and Tenant agree as follows:
1. INCORPORATION. The background recitals above are hereby incorporated into this Lease by reference as if set forth in full.
2. LEASE OF SITE. Subject to the execution of the PPA, Landlord hereby leases to Tenant, and Tenant takes from Landlord, the Site in accordance with the terms and conditions hereunder. The Parties expressly agree that this Lease shall be further subject to the terms and conditions of the PPA.
3. TERM. The Lease shall become effective as of the date of its execution (“Commencement Date”), and shall remain in full force and effect until the twenty-fifth (25th) anniversary of COD under the under the PPA (the “Ending Date”), subject to the early termination and any other provision set forth in the PPA. Either Party may give the other Party written notice of its desire to extend this Lease upon the terms and conditions set forth herein for an additional four (4) years (the “Additional Term” and, together with the Initial Term, the “Term”). Such notice shall be given, if at all, not more than one hundred twenty (120) days, and not less than sixty (60) days, before the last day of the Initial Term. The Party receiving the notice requesting an Additional Term shall respond positively or negatively to that request in writing within thirty (30) days after its receipt of the request. Failure to respond within such period shall be deemed a rejection of the offer for an Additional Term.
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4. RENTAL. The base rent during the Term (“Base Rent”) shall be One Dollar ($1.00) per year, which Tenant shall pay to Landlord at Landlord’s address set forth in the PPA, or at such other place as Landlord by written notice to Tenant may direct. Base Rent shall be due and paid in full on the COD and upon each anniversary thereof during the Term. All additional charges and fees payable to Landlord by Tenant under this Lease shall be known as “Additional Rent”. Base Rent and Additional Rent, taken together, shall be known hereunder as “Rent”.
5. POSSESSION. Landlord shall deliver to Tenant possession of the Site on the Commencement Date in “as-is, where-is, with-all-faults” condition, without a warranty of any kind, except as otherwise set forth in this Lease.
6. USE. Tenant shall use the Site only for the purposes of developing, designing, constructing, owning, operating and maintaining the Facility (the “Permitted Use”).
7. COMPLIANCE WITH LAW. Tenant shall comply with all laws, regulations, rules and ordinances of any governmental authority which may be applicable to the Site or Tenant’s exercise of the Permitted Use. Tenant shall not conduct or permit any unlawful activities on the Site.
8. MAINTENANCE. Tenant shall be responsible, at its sole cost and expense, to keep and maintain all portions of the Site and the Facility in good working order and condition, including, without limitation: all periodic and necessary maintenance; all necessary repairs and replacements of structural components of the Facility; all repairs and replacements of the mechanical, electrical or other systems serving the Facility and the Site; and any other structural improvements or installations used in connection therewith.
9. ALTERATIONS AND ADDITIONS. Except as set forth in this Lease or the PPA, Tenant shall not make any alterations or additions to the Site without Landlord’s prior written consent. Any permitted alteration or addition shall be done in a good and workmanlike manner and in compliance with all applicable laws and building codes. Tenant shall be responsible to ensure that the Site remains free of liens for labor or materials supplied for work thereon. Tenant shall retain ownership of the Facility and all of its other trade fixtures and equipment, none of which shall become a part of the Site at the expiration or earlier termination of this Lease. Upon such expiration or termination, Tenant, at its sole cost and expense, shall promptly remove the Facility and all of Tenant’s personal property in accordance with the termination provisions set forth under this Lease and the PPA.
10. SIGNAGE. Except as otherwise set forth in the PPA, Tenant shall not place any signs on the Site without the prior written approval of Landlord. All such signs approved by Landlord to be placed or installed on the Site must be designed and constructed in compliance with all applicable laws, regulations, rules and ordinances of any governmental authority.
11. TAXES. During the Term, Tenant shall be responsible for the payment of all real estate taxes assessed against the Site, the Facility and the underlying real property. Tenant shall also be responsible to pay when due all personal property taxes assessed during the Term against the Facility and Tenant’s personal property, equipment and trade fixtures located on or about the Site.
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12. UTILITIES AND SERVICES. Tenant shall be responsible to procure and pay for all utilities and services used in connection with the Site and the Facility, of any nature whatsoever. Tenant shall procure all electric utility services from PPL EU.
13. INSURANCE. The parties shall be bound to the insurance provisions under the PPA.
14. CONDEMNATION. If the entire Site is condemned, or if a portion is taken which causes the Site to be unsuited for the Permitted Use, then Tenant shall have the right to terminate this Lease as of the date upon which possession is taken by the condemning authority. Otherwise, Tenant shall proceed to make necessary repairs and alterations to the Site and continue its operations thereon. Rent shall be reduced for the remainder of the Term to the extent and in the same proportion as the reduction in the reasonable rental value of the Site for the Permitted Use caused by the condemnation. All condemnation proceeds shall belong to Landlord, except for any award specifically made to Tenant for interruption of its business, moving expenses or the taking of Tenant’s trade fixtures. Sale of all or a part of the underlying real property to a purchaser with the power of eminent domain in the face of a threat, or the probability of the exercise of the power, shall be treated as a taking by condemnation.
15. DAMAGE TO SITE. In case of damage or destruction to all or a portion of the Site, Tenant shall proceed promptly to restore the Site to a condition equivalent in function and value to that existing prior to the damage.
16. DEFAULT OF TENANT. Each of the following shall be considered an event of default (“Event of Default”):
(a) Tenant fails to make any Rent or other payment under this Lease within ten (10) days of the date it is due.
(b) Tenant fails to comply with any other term, condition or obligation under this Lease within thirty (30) days after written notice by Landlord specifying the nature of the alleged default. If the alleged default is of such a nature that it cannot be remedied fully within the thirty (30) day period, this requirement shall be considered to be satisfied if Tenant begins corrective action within such thirty (30) day period and thereafter proceeds with reasonable diligence and good faith for a period of up to 120 days to effect the remedy as soon as practicable.
(c) Tenant abandons the Site for a period of at least thirty (30) days; Tenant dissolves or terminates its existence; Tenant is insolvent; the commencement by Tenant of a voluntary case under federal bankruptcy laws or under any other federal or state law relating to insolvency or debtor’s relief; the entry of a decree or order for relief against Tenant in an involuntary case under the federal bankruptcy laws or under any other applicable federal or state law relating to insolvency or debtor’s relief; or the appointment of a receiver, trustee or custodian of Tenant.
(d) The occurrence of any “Event of Default” under the PPA, as such term is defined thereunder.
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17. LANDLORD REMEDIES. Upon the occurrence of any Event of Default, Landlord may exercise any one or more of the following remedies, or any other remedy available under the PPA or otherwise applicable at law or in equity:
(a) Termination. Landlord may terminate Tenant’s right to possession of the Site and Tenant’s rights under this Lease by giving written notice to Tenant of Landlord’s election to terminate Tenant’s right to possession of the Site, and this Lease will terminate as of the date of such notice, or if a default occurs and Tenant abandons the Site, this Lease will automatically terminate. In the event of such termination, Landlord may recover damages from Tenant as provided in Section 17(c) below.
(b) Retake Possession. Landlord may re-enter and retake possession of the Site, without notice, either by summary proceedings, force, any other applicable action or proceeding, or otherwise. Landlord may use the Site for Landlord’s own purposes or relet it upon any reasonable terms without prejudice to any other remedies that Landlord may have by reason of Tenant’s default. None of these actions will be deemed an acceptance of surrender by Tenant.
(c) Damages for Default. Whether or not Landlord retakes possession or relets the Site, Landlord may recover all damages caused by the Event of Default, including, but not limited to, unpaid Rent, attorneys’ fees relating to the Event of Default, and any costs of reletting the Site. Landlord may sue periodically to recover damages as they accrue during the remainder of the Term without barring a later action for further damages. Landlord may at any time bring an action for accrued damages plus damages for the remaining Term equal to the difference between Rent and the reasonable rental value of the Site for the remainder of the term.
(d) Cure of Tenant’s Default. Without prejudice to any other remedy for an Event of Default, Landlord may perform any obligation or make any payment required to cure an Event of Default by Tenant. The cost of performance, including attorneys’ fees and all disbursements, shall immediately be repaid by Tenant upon demand, together with interest from the date of expenditure until fully paid at the rate of twelve percent (12%) per annum, but not in any event at a rate greater than the maximum rate of interest permitted by law.
(e) Self-Help. Landlord shall have the right to self-help should Tenant fail to promptly comply with any request of Landlord related to any remedy provided hereunder. Such right of self-help shall include, but not be limited to, the right to retake the Site and peaceably remove Tenant therefrom without obtaining court approval or other governmental intervention.
(f) Confession of Judgment.
(i) WHEN THIS LEASE AND THE TERM OR ANY EXTENSION OR RENEWAL THEREOF SHALL HAVE BEEN TERMINATED ON ACCOUNT OF ANY EVENT OF DEFAULT BY TENANT HEREUNDER, AND ALSO WHEN THE TERM HEREBY CREATED OR ANY EXTENSION OR RENEWAL THEREOF SHALL HAVE EXPIRED, IT SHALL BE LAWFUL FOR ANY ATTORNEY OF ANY COURT OF RECORD TO APPEAR AS ATTORNEY FOR TENANT AS WELL AS FOR ALL PERSONS CLAIMING BY, THROUGH OR UNDER TENANT, AND TO SIGN AN AGREEMENT FOR ENTERING INTO ANY COMPETENT COURT AN AMICABLE ACTION IN EJECTMENT AGAINST TENANT AND ALL PERSONS CLAIMING BY, THROUGH OR UNDER TENANT AND THEREIN CONFESS JUDGMENT FOR THE RECOVERY BY LANDLORD OF POSSESSION OF THE SITE, FOR WHICH THIS
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LEASE SHALL BE HIS SUFFICIENT WARRANT; THEREUPON, IF LANDLORD SO DESIRES, AN APPROPRIATE WRIT OF POSSESSION MAY ISSUE FORTHWITH, WITHOUT ANY PRIOR WRIT OR PROCEEDING WHATSOEVER, AND PROVIDED THAT IF FOR ANY REASON AFTER SUCH ACTION SHALL HAVE BEEN COMMENCED IT SHALL BE DETERMINED THAT POSSESSION OF THE SITE REMAIN IN OR BE RESTORED TO TENANT, LANDLORD SHALL HAVE THE RIGHT FOR THE SAME DEFAULT AND UPON ANY SUBSEQUENT DEFAULT OR DEFAULTS, OR UPON THE TERMINATION OF THIS LEASE OR TENANT’S RIGHT OF POSSESSION AS HEREINBEFORE SET FORTH, TO BRING ONE OR MORE FURTHER AMICABLE ACTION OR ACTIONS AS HEREINBEFORE SET FORTH TO RECOVER POSSESSION OF THE SITE AND CONFESS JUDGMENT FOR THE RECOVERY OF POSSESSION OF THE SITE AS HEREINBEFORE PROVIDED.
(ii) IF RENT OR ANY CHARGES HEREBY RESERVED AS RENT, OR LIQUIDATED DAMAGES, OR ANY OTHER SUM PAYABLE HEREUNDER, SHALL REMAIN UNPAID WHEN THE SAME OUGHT TO BE PAID, TENANT HEREBY EMPOWERS ANY PROTHONOTARY OR ATTORNEY OF ANY COURT OF RECORD TO APPEAR FOR TENANT IN ANY AND ALL ACTIONS WHICH MAY BE BROUGHT FOR RENT, LIQUIDATED DAMAGES OR OTHER CHARGES OR EXPENSES AGREED TO BE PAID BY TENANT HEREUNDER AND TO SIGN FOR TENANT AN AGREEMENT FOR ENTERING INTO ANY COMPETENT COURT AN AMICABLE ACTION OR ACTIONS FOR THE RECOVERY OF RENT, LIQUIDATED DAMAGES OR OTHER CHARGES OR EXPENSES, AND IN SAID SUITS OR IN SAID AMICABLE ACTION OR ACTIONS TO CONFESS JUDGMENT AGAINST TENANT FOR ALL OR ANY PART OF THE RENT INCLUDING, AT LANDLORD’S OPTION, THE RENT FOR THE ENTIRE UNEXPIRED BALANCE OF THE TERM OF THE LEASE, COMPUTED AS AFORESAID, AND ANY OTHER CHARGES, PAYMENTS, COSTS AND EXPENSES RESERVED AS RENT OR AGREED TO BE PAID BY THE TENANT, AS WELL AS LIQUIDATED DAMAGES, AND FOR INTEREST AND COSTS TOGETHER WITH AN ATTORNEY’S COMMISSION OF FIVE PERCENT (5%) THEREOF. SAID AUTHORITY SHALL NOT BE EXHAUSTED BY ONE EXERCISE THEREOF, BUT JUDGMENT MAY BE CONFESSED AS AFORESAID FROM TIME TO TIME AND AS OFTEN AS ANY OF SAID RENT OR OTHER CHARGES RESERVED AS RENT OR LIQUIDATED DAMAGES SHALL FALL DUE OR BE IN ARREARS, AND SUCH POWERS MAY BE EXERCISED AS WELL AFTER THE EXPIRATION OF THE TERM.
(iii) IN ANY AMICABLE ACTION OF EJECTMENT BROUGHT HEREON, LANDLORD SHALL FIRST CAUSE TO BE FILED IN SUCH ACTION AN AFFIDAVIT MADE BY LANDLORD OR SOMEONE ACTING FOR LANDLORD, SETTING FORTH THE FACTS NECESSARY TO AUTHORIZE THE ENTRY OF JUDGMENT, OF WHICH FACTS SUCH AFFIDAVIT SHALL BE PRIMA FACIE EVIDENCE, AND IF A TRUE COPY OF THIS LEASE (AND OF THE TRUTH OF THE COPY SUCH AFFIDAVIT SHALL BE SUFFICIENT EVIDENCE) SHALL BE FILED IN SUCH SUIT, ACTION OR ACTIONS, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL AS A WARRANT OF ATTORNEY, ANY RULE OF COURT, CUSTOM OR PRACTICE TO THE CONTRARY NOTWITHSTANDING.
(iv) IN GRANTING THIS WARRANT OF ATTORNEY TO CONFESS JUDGMENT, TENANT HEREBY KNOWINGLY, INTENTIONALLY, VOLUNTARILY AND UNCONDITIONALLY WAIVES ANY AND ALL RIGHTS TENANT HAS OR MAY HAVE TO PRIOR NOTICE OR AN OPPORTUNITY FOR A PRIOR HEARING UNDER THE RESPECTIVE CONSTITUTIONS AND LAWS OF THE UNITED STATES AND THE COMMONWEALTH OF PENNSYLVANIA. IN NEGOTIATING AND EXECUTING THIS LEASE, TENANT HAS BEEN
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REPRESENTED BY COUNSEL OF ITS OWN CHOOSING, OR HAS HAD THE OPPORTUNITY TO DO SO.
THE NOTARIZED ACKNOWLEDGMENT FOLLOWING THE SIGNATURE PAGE OF THIS LEASE SHALL CONSTITUTE A PROPER ACKNOWLEDGMENT OF THIS CONFESSION OF JUDGMENT IN ACCORDANCE WITH PENNSYLVANIA LAW RELATING TO POWER OF ATTORNEY.
________________ Tenant Initials
(g) Remedies Cumulative. Landlord and Tenant understand and agree that the remedies above given to Landlord shall be cumulative, and the exercise of any one remedy by Landlord shall not be to the exclusion of any other remedy. Each and all of said remedies shall be exercisable repeatedly and as often as may be necessary.
18. WAIVERS. TENANT WAIVES ANY NOTICE TO QUIT REQUIRED BY ANY LAW NOW IN FORCE OR HEREAFTER ENACTED. TENANT HEREBY WAIVES AND RELEASES ALL ERRORS AND DEFECTS WHICH MAY INTERVENE IN THE LANDLORD’S EXERCISE OF ANY OF ITS REMEDIES HEREUNDER, INCLUDING THE SUMMARY REMEDIES, AND LANDLORD AND TENANT EACH WAIVES ITS RIGHT TO TRIAL BY JURY. TENANT FURTHER WAIVES ANY RIGHT TO RECEIVE NOTICE UNDER THE LANDLORD AND TENANT ACT OF 1951, AS AMENDED, WITH RESPECT TO PERSONAL PROPERTY LEFT ON OR IN THE SITE FOLLOWING EXPIRATION OR EARLIER TERMINATION OF THE TERM.
19. SURRENDER OF SITE.
(a) Condition of Site. Upon expiration or earlier termination of this Lease, on account of default or otherwise, Tenant shall surrender the Site in at least as good a condition as existed at the commencement of the Term. Depreciation and reasonable wear and tear from ordinary use for the purpose for which the Site was let need not be restored, but all repairs for which Tenant is responsible shall be completed to the latest practical date prior to such surrender.
(b) Tenant’s Personal Property. Tenant shall remove all of its personal property, including, without limitation, all furnishings, furniture, trade fixtures and equipment, which remain on the Site at the time of surrender and restore any damage caused by such removal.
(c) Holdover. If Tenant does not vacate the Site at the time required, Landlord shall have the option to treat Tenant as a tenant from month to month, subject to all of the provisions of this Lease (except that the term will be month-to-month and the rent will be increased to the fair market rate applicable at that time), or to eject Tenant from the Site and recover damages caused by wrongful holdover. Failure of Tenant to remove the Facility or other trade fixtures or equipment which Tenant is required to remove under this Lease shall constitute a failure to vacate to which this paragraph shall apply if the Site not removed substantially interferes with occupancy of the Site by another tenant or with occupancy by Landlord for any purpose including preparation for a new tenant. If a month-to-month tenancy results from a holdover by Tenant, the tenancy shall be terminable at the end of any monthly rental period on written notice from Landlord given not less than ten (10) days prior to the
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termination date which shall be specified in the notice. Tenant waives any notice which would otherwise be provided by law with respect to month-to-month tenancy.
20. NOTICES. All notices, demands or other communications required or permitted to be given hereunder shall be in writing and given by personal delivery or registered or certified mail, return receipt requested, or by Federal Express or other recognized overnight courier requiring a receipt upon delivery, addressed to the Parties as set forth in the PPA. Either Party, by written notice to the other, may direct that future notices and demands be sent to a different address. A notice shall be deemed given on the date it is delivered to the intended recipient, as acknowledged by a receipt signed by the recipient, or if such delivery is refused, on the date of refusal.
21. INDEMNIFICATION. Tenant hereby agrees to indemnify and hold Landlord (and Landlord’s officers, employees, council members and agents) harmless from and against any and all liabilities, costs, expenses, losses, damages and claims for injury to person (including death) or property, including, but not limited to, reasonable attorneys’ fees relating thereto, caused by or arising from the use and occupancy of the Site by Tenant (and its agents, employees, contractors, licensees and invitees), excluding those caused by or arising from Landlord’s gross negligence or willful misconduct. The indemnities granted in this Section 21 shall survive the expiration or earlier termination of this Lease.
22. GENERAL PROVISIONS.
(a) Entire Agreement. This Lease represents the entire understanding and agreement of the Parties with respect to the matters set forth in this Lease, and this Lease supersedes and replaces all prior written and oral agreements between the Parties or their representatives with respect to such matters.
(b) Binding Nature. This Lease shall bind and inure to the benefit of Landlord and Tenant and their respective successors and permitted assigns.
(c) Quiet Enjoyment. So long as Tenant complies with the terms and conditions of this Lease, Tenant shall be entitled to peaceable and undisturbed possession of the Site free from any interference by Landlord or those claiming through Landlord.
(d) Assignment and Subletting. Tenant shall not assign this Lease or sublet the Site without the prior written consent of Landlord, which consent shall not be unreasonably withheld.
(e) Amendment. This Lease may not be amended or modified except by a written instrument signed by Landlord and Tenant.
(f) Landlord’s Access. Landlord and its authorized representatives may enter the Site during the Term to perform any of Landlord’s obligations under this Lease, to make necessary repairs or show the Site to any prospective tenants or purchasers. Except in the case of emergency, Landlord shall provide to Tenant at least twenty-four (24) hours written or oral notice of such entry.
(g) Governing Law. This Lease shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania without regard to conflicts of law principles.
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(h) Validity. If any provision in this Lease shall be found invalid, illegal or unenforceable in any respect, the validity of the remaining provisions contained in this Lease shall not be affected.
(i) Counterparts. This Lease may be executed in multiple counterparts, each of which shall be deemed an original, and all such counterparts, taken together, shall constitute one and the same complete instrument. Facsimile or electronic versions of signatures shall be acceptable as originals.
(j) Subordination. This Lease and all of the rights of Tenant hereunder shall be subject and subordinate to the lien of any mortgage or mortgages now or hereinafter placed on the Site or any part thereof, and any and all renewals, modifications, replacements, extensions, or substitutions of any such mortgage or mortgages (each being a “Mortgage”). Tenant agrees to attorn to (i) any receiver appointed for the Site in connection with any Mortgage, (ii) the holder of any Mortgage (“Mortgagee”) who acquires title to the Site or (iii) any Mortgagee or other person who succeeds to the interest of Landlord under this Lease or otherwise acquires title to the Site by foreclosure of a Mortgage or otherwise. Tenant, if requested by Landlord, shall execute any instruments in recordable form as may be reasonably required by Landlord in order to confirm or effect the subordination or priority of this Lease, as the case may be, and the attornment of Tenant to future landlords in accordance with the terms of this Section 22(j).
(k) Tenant’s Certification. From time to time upon the reasonable request of Landlord, upon ten (10) business days’ notice, Tenant shall execute and deliver to Landlord a statement provided by Landlord to Tenant indicating the commencement date of the Lease, the termination date of the Lease, Landlord’s compliance with the terms of the Lease and such other items regarding the terms of the Lease that may be reasonably requested by Landlord.
[Signature page follows.]
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IN WITNESS WHEREOF, Landlord and Tenant have executed this Lease Agreement as of the day and year first written above.
LANDLORD:
BOROUGH OF EPHRATA, PENNSYLVANIA, a Pennsylvania municipal corporation
By: Name:Title:
TENANT:
By: Name:Title:
ACKNOWLEDGEMENT OF CONFESSION OF JUDGMENT(Set forth in Section 17(f) of the foregoing Lease Agreement)
STATE OF _______________________ :: SS:
COUNTY OF ______________________ :
On this _______ day of __________________, 2017, before me, the undersigned officer, personally appeared _________________________, who acknowledged her/himself to be the __________________ of _____________________________________ (the “Company”), and that s/he, as such officer, and being authorized to do so, executed the foregoing instrument for the purposes therein contained by signing the name of the Company by her/himself as such officer.
IN WITNESS WHEREOF, I have hereunto set my hand and official seal.
____________________________________Notary Public
My commission expires: (Seal)
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