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 such
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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 h a v e 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:
(i) such Party has (A) applied for or consented to the appointment of, or the
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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.
“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
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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.
“Fair Market Value” h a s t h e m e a n i n g s e t f o r t h i n S e c t i o n 1 4 . 2 .
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"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 non-human 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. §9601
et seq. (42 U.S.C. §9601).
"Initial Term" has the meaning set forth in Article 2.
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"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 between
Borough 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 Devices
installed pursuant to Section 5.3.
"Solar Energy Payment Rate" means $XX.XX per MWh to be paid by Borough
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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.
3.2
Location. The Facility shall be located on the Site described in Exhibit B.
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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 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
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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.
(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.
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(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:
(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.
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(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)
6.3
Receipt of PPL EU’s approval that the Facility’s design satisfies the
system protection requirements set forth in Exhibit F.
Early Termination.
(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
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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 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.
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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 nonbinding 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.
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.
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(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 dayto-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
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 Attributes
(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
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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.
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
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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 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
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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 relating to
performance of this PPA and to attempt to r e s o l v e 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.
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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 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
18
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 Representations and Warranties.
warrants as follows:
Seller hereby represents and
(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
(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
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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 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.
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(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
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
21
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 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.
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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
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
23
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).
18.4
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 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.
24
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 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
25
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.]
26
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:
27
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
28
Exhibit A
Construction Milestones
All Permits Complete
Notice to Proceed
Construction Start Date
Guaranteed Commercial
Operation Date
Commercial Operation Date
29
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.
30
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:
31
A satellite view and survey of the Site are show below:
32
33
Exhibit C
Estimated Annual Energy Output
Estimated Annual
Energy Output MWh*
Commercial
Operation
Year
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
* reflects .005 annual degradation factor
34
Exhibit D
Operating Committee
Borough
Primary Representative:
Seller
Primary Representative:
Tom Natarian
Director of Operations
Borough of Ephrata, PA
Via hand delivery:
Via hand delivery:
Via overnight service:
Via overnight service:
Phone:
Email:
Phone:
Email:
35
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 selfinsurance 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 Seller
36
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
1,000,000
2,000,000
2,000,000
each occurrence;
personal and advertising injury;
general aggregate; and
products/completed operations aggregate.
This insurance shall include coverage for all of the following:
i.
ii.
iii.
iv.
Liability arising from premises and operations;
Liability arising from the actions of independent contractors;
Liability arising from products and completed operations;
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
37
and including all of the following coverages on the applicable schedule of underlying
insurance:
i. Commercial general liability;
ii. Business auto liability; and
iii. 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 selfinsurance 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 noncontributory 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 and
its elected and appointed officials, officers and employees for property damage to or loss of use
38
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.
39
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 the anti-islanding protection
installed, there shall be no back feed into either the Borough system or into the PPL EU system.
40
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
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.
41
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 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
42
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 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
43
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.
44
45
46
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)
defined thereunder.
The occurrence of any “Event of Default” under the PPA, as such term is
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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
50
WHICH THIS 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,
51
TENANT HAS BEEN 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
52
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 _______________________
COUNTY OF ______________________
:
:
:
SS:
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.
My commission expires:
____________________________________
Notary Public
(Seal)
55