HomeMy WebLinkAboutGrand Husk Solar, LLC - Lease Agreement - 1.5.2026Execution Version
LEASE AGREEMENT
between
Grand Husk Solar, LLC
as Tenant
and
City of Waterloo
as Owner
dated ickil Zpz
TABLE OF CONTENTS
Execution Version
Page(s)
ARTICLE 1 DEFINITIONS AND CONSTRUCTION
Section 1.1 Defined Terms
Section 1.2 Construction
ARTICLE 2 GRANT OF RIGHTS; TERM
Section 2.1
Section 2.2
ARTICLE 3 RENT
Section 3.1
Section 3.2
Section 3.3
Section 3.4
Section 3.5
Section 3.6
Section 3.7
Lease and Grant of Lease Rights
ARTICLE 4 LEASE RIGHTS
Section 4.1
Section 4.2
Section 4.3
Section 4.4
2
3
8
8
8
Term of Lease 8
9
Development Term Rent 9
Construction Term Rent 10
Production Term Rent 10
Restoration Term Rent 10
Payment Adjustments 10
Crop Compensation, Pivot and Drip Irrigation, and CRP 10
Payment Allocations 11
11
Additional Lease Rights 11
Stand -Alone Lease Rights 12
Nature of Lease Rights, Additional Lease Rights and Stand -
Alone Lease Rights 12
Separate Storage Leases 12
ARTICLE 5 PERMITTED USE; RIGHTS OF PARTIES; DEVELOPMENT
PROGRESS 13
Permitted Use 13
No Required Construction or Production 13
ARTICLE 6 TENANT'S OBLIGATIONS 13
Compliance with Law 13
Location of Project and Care and Appearance 14
Fences and Gates 14
Operations 14
Payment of Claims 16
Section 5.1
Section 5.2
Section 6.1
Section 6.2
Section 6.3
Section 6.4
Section 6.5
Section 6.6 Restoration 16
Section 6.7 Taxes 16
ARTICLE 7 OWNER'S OBLIGATIONS 17
Section 7.1 No Interference 17
Section 7.2 Compliance with Obligations 18
Section 7.3 Rights of Third Parties 19
Section 7.4 No Ownership Rights 19
Section 7.5 Cooperation 19
Section 7.6 Setback Waiver 21
Section 7.7 Confidentiality 21
Section 7.8 Division of Lease 22
Section 7.9 Estoppel Certificates 22
Section 7.10 Representations and Warranties of Owner 22
ARTICLE 8 DEFAULT; REMEDIES; PROTECTION OF LENDERS 23
Section 8.1 Default 23
Section 8.2 Owner's Right to Terminate for Monetary Default 24
Section 8.3 Limitation on Remedies 25
Section 8.4 Protection of Lenders 25
ARTICLE 9 ASSIGNMENT AND SUBLETTING 28
Section 9.1 Right to Assign or Sublet 28
Section 9.2 Right To Encumber 28
ARTICLE 10 GENERAL PROVISIONS 29
Section 10.1 Insurance 29
Section 10.2 Environmental Matters 29
Section 10.3 Use of Water 30
Section 10.4 Indemnity 31
Section 10.5 Safety Measures; Waiver and Recognition 31
Section 10.6 Casualty and Condemnation 32
Section 10.7 Notices 33
Section 10.8 Force Majeure 33
Section 10.9 Meetings with Third Persons 34
Section 10.10 Termination 34
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Section 10.11 Third Party Beneficiaries 34
Section 10.12 Attorneys' Fees 35
Section 10.13 Covenants Running With the Land 35
Section 10.14 Governing Law 35
Section 10.15 Memorandum 35
Section 10.16 Joint and Several Liability 35
Section 10.17 Binding on Partial Interests 35
Section 10.18 Savings Clause 35
Section 10.19 No Waiver 35
Section 10.20 Entire Agreement; Modifications; Conflicts 35
Section 10.21 Multiple Counterparts 36
Section 10.22 Provision of Copy of Lease 36
Section 10.23 Cooperation on Owner's Interest 36
Section 10.24 Limited Accessway 36
Section 10.25 Restricted Area 37
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Execution Version
LEASE AGREEMENT
THIS LEASE AGREEMENT ("Agreement") is made, dated and effective as of
(the "Effective Date"), and between the Owner ("Owner") and
Tenant ("Tenant"), designated in the Basic Terms and Conditions below:
Basic Terms and Conditions
Effective Date of this Agreement:
Owner:
City of Waterloo
Owner's Address:
715 Mulberry St., Waterloo, IA 50703
Tenant:
Grand Husk Solar, LLC, a Delaware limited liability
company
Tenant's Address:
320 N. Sangamon Street, Suite 1025, Chicago, Illinois
60607
Property:
501.45 acres in the County of Black Hawk, Iowa as
specifically described in Exhibit A.
Length of Lease Term:
The "Development Term" shall be a period of five
(5) years from the Effective Date, with two (2) one (1)-
year extension options (i.e., totaling up to seven (7) years
if all options and extensions are exercised), all as set forth
in Section 2.2(a). The "Construction Term" shall
commence on the Construction Commencement Date and
be for a period of up to three (3) years, all as set forth in
Section 2.2(b). The Tenant may exercise an option to
extend the term of the Lease through the Production Term
by achieving the Generation Commencement Date.
Should the Generation Commencement Date occur any
time prior to the expiration of the Construction Term, the
"Production Term" will automatically commence and
continue, unless terminated earlier as provided herein, to
a date which is twenty (20) years from the Generation
Commencement Date, subject to four (4) extension terms
of five (5) years each (i.e., totaling up to forty (40) years
of Production Term if all options and extensions are
exercised), all as provided in Section 2.2(c). The
"Restoration Term" shall begin on the expiration or earlier
termination of (a) the Construction Term, if it occurs and
if construction has commenced, or (b) the Production
Term, if Tenant does exercise an option to extend the term
of the Lease through the Production Term, and shall
expire when Tenant completes the Restoration
Obligations.
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Development Term Rent:
One-time payment of $50.00 per acre subject to this
Agreement (excluding the Restricted Area) to be paid by
Tenant to Owner (the "Signing Fee"), as well as and to
the extent applicable $50.00 per acre subject to this
Agreement (excluding the Restricted Area) to be paid by
Tenant to Owner at the end of each twelve (12) month
period during the Development Term (the "Periodic
Development Term Rent"), and if the Development
Term is extended, a one-time payment for each extension
of $30.00 per acre subject to this Agreement (excluding
the Restricted Area) (the "Additional Development
Term Rent" and together with the Signing Fee and
Periodic Development Term Rent, the "Development
Term Rent"). Development Term Rent is payable as
required in Section 3.1.
Construction Term Rent:
If the Construction Commencement Date has occurred,
then an annual payment of $350.00 per acre times the
number of acres of the Property which Tenant's plans
show will be enclosed by a fence to be constructed for the
Project shall be paid by Tenant to Owner (the
"Construction Term Rent"). Construction Term Rent is
payable as required in Section 3.2.
Production Term Rent:
During the Production Term (if it occurs), Tenant will pay
Owner for the first Lease Year an amount equal to
$1,400.00 (the "Production Term Rent Multiplier")
multiplied by the total number of acres of the Property
which are enclosed by a fence constructed for the Project
or which Tenant's plan show will be enclosed by a fence
to be constructed for the Project. The Production Term
Rent Multiplier shall increase by two percent (2%) per
Lease Year during the Production Term. All of the
foregoing shall be referred to as the "Production Term
Rent".
Restoration Term Rent:
Tenant will not owe any amounts to Owner as rent during
the Restoration Term.
ARTICLE 1 DEFINITIONS AND CONSTRUCTION
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Section 1.1 Defined Terms. When used in this Agreement, the following capitalized
terms shall have the definitions indicated:
"Additional Lease Rights": Shall have the meaning set forth in Section 4.1.
"Affiliate": any Person (i) who, directly or indirectly (including through one or more
intermediaries), holds an equity interest in Tenant (a "Parent Company") or (ii) in which Tenant
or a Parent Company, directly or indirectly (including through one or more intermediaries) holds
an equity interest.
"Agreement": This Lease Agreement (including the Lease and Lease Rights).
"Award": Shall have the meaning set forth in Section 10.6(b).
"CERCLA": Shall have the meaning set forth in Section 10.2(c).
"Confidential Information": Shall have the meaning set forth in Section 7.7.
"Construction Commencement Date": The earlier of: (a) the date Tenant provides
written notice to Owner of the Construction Commencement Date; or (b) the date when Tenant
commences the installation of vertical improvements for Solarpower Facilities for the Project on
the Property and is diligently pursuing construction of the Project on the Property. For the
avoidance of doubt, pre -construction studies, surveys, and development -related diligence shall not
be considered construction commencement.
"Construction Term": The period beginning on the Construction Commencement Date
and terminating upon expiration or earlier termination as provided herein.
"Construction Term Rent": Shall have the meaning set forth in the Basic Terms and
Conditions.
"County": The county in which the Property is situated.
"Development Term": The period during which Tenant performs development activities,
including but not limited to measuring the solar resource, obtaining permits, securing Tenant's
position to interconnect into the grid, as more particularly defined in the Basic Terms and
Conditions and Section 2.2(a).
"Development Term Rent": Shall consist of the Signing Fee and, if applicable, the
Periodic Development Term Rent and the Additional Development Term Rent, and have the
meaning set forth in the Basic Terms and Conditions.
"Effective Date": Shall have the meaning given in the first sentence of this Agreement.
"Encumbrances": Any liens, encumbrances, covenants, conditions, reservations,
restrictions, easements, leases, licenses, occupancies, tenancies, mineral rights, water rights or
other matters affecting, relating to or encumbering the Property or any portion thereof.
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"Environmental Laws": Shall have the meaning set forth in Section 10.2(c).
"Event of Default": Shall have the meaning set forth in Section 8.1.
"Event of Force Majeure": Strikes, lockouts or other labor disturbances; delays in
transportation; inability to secure labor or materials in the open market; acts of God or the
elements, including fire, flood, washout, perils at sea, lightning, earthquake or accidents;
conditions arising out of or attributable to acts of war, civil disturbances or riots; the effect of any
Law; the failure of any governmental authority to issue any permit, entitlement, approval or
authorization within a reasonable period of time after an application for the same has been
submitted; the inability to sell electricity at commercially reasonable prices in the open market;
orders of curtailment or suspension or cessation of transmission system operations by MISO; or
any other matter or condition beyond the reasonable anticipation and control of the party in
question, whether or not similar to the matters or conditions herein specifically enumerated; and
(in the case of Tenant) while litigation contesting all or any portion of the right, title and interest
of Owner in the Property and/or of Tenant under this Agreement shall be pending and not finally
determined.
"Expenses": Any and all expenses incurred in connection with investigating, defending
or asserting any claim, action, suit or proceeding incident to any matter indemnified against
hereunder (including, without limitation, court filing fees, court costs, arbitration fees or costs,
witness fees, and reasonable fees and disbursements of legal counsel, investigators, expert
witnesses, consultants, accountants and other professionals), and any and all losses, costs,
obligations, liabilities, settlement payments, awards, judgments, fines, penalties, damages,
expenses, deficiencies or other charges with respect thereto, but excluding in any event any Party's
own (i.e., not damages claimed by a third party) lost profits and other special or consequential
damages, which result from the indemnifiable events described herein.
"Extension Date": Shall have the meaning set forth in Section 2.2(c).
"Extension Term": Shall have the meaning set forth in Section 2.2(c).
"Generation Commencement Date": The earlier of: (a) the date Tenant provides written
notice to Owner of the Generation Commencement Date; or (b) the date on which any Solarpower
Facilities that are being constructed on the Property have passed their initial performance tests and
have begun to commercially deliver electricity into the transmission grid.
"Hazardous Materials": Shall have the meaning set forth in Section 10.2(d).
"Indemnified Party": Shall have the meaning set forth in Section 10.4.
"Indemnifying Party": Shall have the meaning set forth in Section 10.4.
"MISO": MISO, a Regional Transmission Organization.
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"Laws": All valid and applicable laws, statutes, ordinances, regulations, orders and
assessments of any federal, state, county or local governmental authority with jurisdiction over the
Project or the Property.
"Lease": The Lease created by this Agreement.
"Lease Rights": The following lease rights in, on, under, over, across, along and above
the Property:
(a) A right of access and of ingress to and egress from the Project, as well as a
right for access to and from adjacent lands in the Project, in each case by means of any existing
roads on the Property, and by such other roads as Tenant may construct on the Property from time
to time at locations reasonably agreed between Tenant and Owner, for the benefit of and for
purposes incidental to Operations on the Property, provided that Owner agrees to approve at least
one road location to the Project;
(b) The right to install, use, repair, improve, relocate, replace and remove
Transmission Facilities to be placed in locations selected by Tenant.
(c) A non-exclusive right for any audio, visual, view, light, shadow, noise,
vibration, air turbulence, wake, electromagnetic or other effect of any kind or nature whatsoever
resulting, directly or indirectly, from any Operations conducted, or Project owned, leased, operated
or maintained by Tenant on the Property and on lands near the Property.
(d) The right to use construction staging and laydown areas in locations
reasonably agreed between Tenant and Owner for installing, using, repairing, improving,
relocating, replacing, and removing the Project.
(e) The exclusive right to study, develop and use the Property for converting
solar energy into electrical energy and collecting and transmitting the electrical energy so
converted.
(f) The exclusive right to access, relocate and maintain the Project located on
the Property.
(g) The exclusive right to capture, use and convert unobstructed solar resources
over and across the Property.
(h) The right to subjacent and lateral support for the Project.
Tenant acknowledges and agrees that the "Lease Rights" are subject to Tenant's
compliance with all applicable Laws, including the securing of any required permits, licenses, or
approvals, and that except as otherwise expressly set forth herein, Owner makes no representation
or warranty concerning any applicable Laws or the ability to secure any permits, licenses, or
approvals.
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"Lease Year": The period from the Generation Commencement Date through the
December 31 of the calendar year in which the Generation Commencement Date occurs (which
shall be deemed the first Lease Year), and each subsequent calendar year during the Production
Term.
"Lender": Any financial institution or other Person that from time to time provides
secured financing for some or all of the Project or Operations, and any agent, security agent,
collateral agent, indenture trustee, loan trustee, loan participant or participating or syndicated
lenders involved in whole or in part in such financing, and their respective representatives,
successors and assigns.
"Lender's Lien": Shall have the meaning set forth in Section 9.2.
"Monetary Default": Shall have the meaning set forth in Section 8.1.
"Non -Monetary Default": Shall have the meaning set forth in Section 8.1.
'Notice of Default": Shall have the meaning set forth in Section 8.1.
"Operations": The activities which Tenant has the right to undertake pursuant to Section
5.1.
"Owner": The legal owner of the Property described in the Basic Terms and Conditions
and as further defined in Exhibit A.
"Owner Nonrenewal Notice": Shall have the meaning set forth in Section 2.2(c).
"Person": Any individual, corporation, partnership, joint venture, association, joint stock
company, trust, trustee, estate, limited liability company, unincorporated organization, real estate
investment trust, government or any agency or political subdivision thereof, or any other form of
entity.
"Production Term": The period beginning on the Generation Commencement Date and
terminating upon expiration or earlier termination as provided herein.
"Production Term Rent": Shall have the meaning set forth in the Basic Terms and
Conditions.
"Project": The Solarpower Facilities, Transmission Facilities, electric transformers,
energy storage facilities, telecommunications equipment related to the Solarpower Facilities,
roads, meteorological stations and solar energy measurement equipment (including pyranometers),
maintenance, administrative and storage areas and buildings, reasonable signage and all related
improvements and equipment, portions of which are located on the Property.
"Property": The Property as described in the Basic Terms and Conditions.
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"Real Property Records": The official public records of the County or Counties in which
deeds and other instruments affecting title to real property are required to be recorded to place
third parties on constructive notice of them.
"Rent": The Development Term Rent, Construction Term Rent, Production Term Rent,
and Restoration Term Rent as described in Article 3.
"Restoration Obligations": Tenant's obligation to (i) remove from the Property any part
of the Project owned, installed or constructed by Tenant thereon except for roads, (ii) fill in and
compact all trenches or other borings or excavations made by Tenant on the Property (excepting
borrow pits and quarries), and (iii) leave the surface of the Property free from debris, as more
particularly defined and described in Section 6.6.
"Restoration Term": As more particularly defined in the Basic Terms and Conditions,
Section 2.2(d), and Section 6.6, the period beginning on (a) the expiration or earlier termination of
the Construction Term, if it occurs and if construction has commenced, or (b) if the Production
Term commences, the expiration or earlier termination of the Production Term, and expiring when
Tenant completes the Restoration Obligations
"Restoration Term Rent": Shall have the meaning set forth in the Basic Terms and
Conditions.
"Solar Panel": A photovoltaic generation unit which converts sunlight into electrical
current which is included in the Solarpower Facilities.
"Solarpower Facilities": Solar -powered electric generating facilities, including Solar
Panels, other photovoltaic generating equipment and such other solar -powered generating
equipment as reasonably determined by Tenant, related infrastructure and the ancillary
improvements and equipment providing support or otherwise associated therewith, all of which is
located on the Property and on any other real property included in the Project.
"Stand -Alone Lease Right": Shall have the meaning set forth in Section 4.2.
"Taking": Shall have the meaning set forth in Section 10.6(a).
"Term": The Development Term, the Construction Term (if it becomes effective) the
Production Term (if it becomes effective and including one or more Extension Terms if exercised),
and the Restoration Term each as described in Section 2.2.
"Town": The town in which the Property is situated.
"Transmission Facilities": Underground and above -ground wires and cables, for the
transmission of electrical energy and/or for communication purposes, and all necessary appliances
and fixtures for use in connection with said wires and cables under, along, above and in or adjacent
to the Property; and one or more substations or interconnection or switching facilities, together
with all related or appropriate rights of way, on, along and in or adjacent to the Property.
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Section 1.2 Construction. In this Agreement, unless the context otherwise requires, the
singular shall include the plural, the masculine shall include the feminine and neuter, and vice
versa. The terms "include," "includes" and "including" shall be deemed to be followed by the
words "without limitation." The term "year" refers to a calendar year, the term "month" refers to
a calendar month, and any period measured by a "year" or a "month" from a reference date refers
to the period beginning on such reference date and ending on the same date of the next succeeding
calendar year or month, respectively, or, if no such date exists in the next succeeding calendar
month, the last day of such next succeeding calendar month. References to a Section or Exhibit
shall be references to a Section of, or Exhibit to, this Agreement unless specifically stated
otherwise. A reference to a given agreement or instrument shall be a reference to that agreement
or instrument as modified, amended, supplemented and restated through the date as of which such
reference is made. The term "or" is not exclusive, the term "shall" is mandatory and the term
"may" is permissive. Owner and Tenant acknowledge that each was actively involved in the
negotiation and drafting of this Agreement and that no law or rule of construction shall be raised
or used in which the provisions of this Agreement shall be construed in favor of or against either
party because one is deemed to be the author thereof. Captions or titles used herein are for
convenience of reference only and do not affect the meaning or intent hereof.
ARTICLE 2 GRANT OF RIGHTS; TERM
Section 2.1 Lease and Grant of Lease Rights. For the good and valuable consideration
provided herein, the receipt and sufficiency of which are hereby acknowledged by Owner and
Tenant, Owner hereby leases to Tenant, and Tenant leases from Owner, the Property, and Owner
grants to Tenant the Lease Rights. Tenant acknowledges and agrees that the "Lease Rights" are
subject to Tenant's compliance with all applicable Laws, including the securing of any required
permits, licenses, or approvals, and that except as otherwise expressly set forth herein, Owner
makes no representation or warranty concerning any applicable Laws or the ability to secure any
permits, licenses, or approvals.
Section 2.2 Term of Lease. The term of this Agreement shall consist of the
Development Term plus, if it becomes effective, the Construction Tenn, plus, if it becomes
effective, the Production Term, plus, if exercised, up to four (4) Extension Terms, plus, if it
becomes effective, the Restoration Term. Prior to the expiration of the Development Term, Tenant
shall have the option to extend the term of this Agreement through the Construction Term, exercise
of such option by Tenant being made and evidenced solely by achievement of the Construction
Commencement Date. Prior to the expiration of the Construction Tenn, Tenant shall have the
option to extend the term of this Agreement through the Production Term, exercise of such option
by Tenant being made and evidenced solely by achievement of the Generation Commencement
Date. Notwithstanding any other provision of this Agreement (including any Lender protection
provisions), if the Development Term or Construction Term of this Agreement expires in
accordance with the terms of this Agreement, prior to the Generation Commencement Date
occurring, this Agreement shall automatically terminate at the expiration of the Restoration Term,
if applicable
(a) The Development Term shall commence on the Effective Date and continue
for a period of up to five (5) years, provided, however, that Tenant shall have the right to extend
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the Development Term two (2) times for an additional one (1) year each by delivering written
notice of such extension to Owner at least thirty (30) days prior to the then -current expiration date
of the Development Term, in the event Tenant extends the Development Term, Tenant shall owe
the Additional Development Term Rent as set forth in Section 3.1. The Development Term shall,
in all events, terminate on the Construction Commencement Date and the Construction Term shall
commence.
(b) The Construction Term shall commence on the Construction
Commencement Date and continue for a period of up to three (3) years. The Construction Term
shall, in all events, terminate on the Generation Commencement Date and the Production Term
shall commence.
(c) The Production Term, if it occurs, shall commence on the Generation
Commencement Date and continue to the date that is twenty (20) years from the Generation
Commencement Date, provided, however, that Tenant shall have the right to extend the Production
Term by four (4) separately exercised periods of five (5) years each (each such five year period,
an "Extension Term") if Tenant delivers written notice of such extension to Owner at least one
hundred eighty (180) days prior to the then -current expiration date of the Production Term or the
then -current expiration date of the Extension Term, as applicable (the "Extension Date"). The
parties understand that the Production Term could total up to forty (40) years if all four (4) options
for Extension Terms are exercised and this Agreement is not earlier terminated by Tenant in
accordance with its terms. The parties intend that the Tenant not lose any option to extend an
Extension Term through inadvertence or mistake. Accordingly, and notwithstanding the
foregoing, if Tenant shall fail to exercise its renewal option for an Extension Term within such
time period as set forth above, Tenant's right to exercise its option for an Extension Term shall
nonetheless continue for an additional sixty (60) days following receipt of Owner's notice to
Tenant and to any Lender of the failure of Tenant to timely exercise such option (the "Owner
Nonrenewal Notice"),If either Tenant or Lender provides notice to Owner of its intent to exercise
such option within such sixty (60) day period following receipt of the Owner Nonrenewal Notice,
then such exercise by Tenant or Lender shall be deemed timely given.
(d) The Restoration Term shall commence on the expiration or earlier
termination of (i) the Construction Term, if it occurs and if construction has commenced, or (ii)
the Production Term, if Tenant does exercise an option to extend the term of the Lease through the
Production Term. The Restoration Term shall when Tenant completes the Restoration
Obligations.
ARTICLE 3 RENT
Section 3.1 Development Term Rent. During the Development Term, Tenant shall pay
to Owner the Development Term Rent in the amount provided for in the Basic Terms and
Conditions. The Signing Fee is payable within forty-five (45) days from the Effective Date. Each
payment of the Periodic Development Term Rent is payable within forty-five (45) days after the
end of each 12-month period of the Development Term (for example, the first such 12-month
period expiring 12 months after the Effective Date). If Tenant exercises an option to extend the
Development Term for one (1) additional year, then the Additional Development Term Rent is
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payable within forty-five (45) days from the date when the additional one (1) year of the
Development Term commences. Tenant shall have no obligation to make any payment to Owner
otherwise required under this Agreement until Tenant has received from Owner a completed
Internal Revenue Service Form W-9.
Section 3.2 Construction Term Rent. During the Construction Term, if it occurs, Tenant
shall pay to Owner the Construction Term Rent in the amount provided for in the Basic Terms and
Conditions. The Construction Term Rent is payable within forty-five (45) days from the
Construction Commencement Date and within forty-five (45) days from each annual anniversary
thereof for the remainder of the Construction Term. If the Construction Commencement Date
occurs during any one (1) year period in which Development Term Rent has been paid, including
in a year in which Tenant has extended the Development Term, the Construction Term Rent shall
be reduced by the prorated amount of the Development Term Rent or the Additional Development
Term Rent, as applicable, for the remaining period for which Development Term Rent has been
paid. For illustrative purposes only, if the Construction Commencement Date occurs six (6) months
into the first year the Development Term is extended, the Construction Term Rent shall be reduced
by a prorated amount that is equal to six (6) months of the Additional Development Term Rent.
Section 3.3 Production Term Rent.
(a) During the Production Term, if it occurs, Tenant shall pay to Owner the
Production Term Rent for each Lease Year as provided for in the Basic Terms and Conditions. If
the Generation Commencement Date occurs during any one (1) year period in which Construction
Term Rent has been paid, the Production Term Rent shall be reduced by the prorated amount of
the Construction Term Rent for the remaining period for which Construction Term Rent has been
paid. For illustrative purposes only, if the Generation Commencement Date occurs six (6) months
into the first year of the Construction Term, the Production Term Rent shall be reduced by a
prorated amount that is equal to six (6) months of the Construction Term Rent.
(b) Payment of Rent. The Production Term Rent shall be paid to Owner within
thirty (30) days of the Generation Commencement Date. Subsequent Production Term Rent shall
be paid annually within thirty (30) days of the first day of each Lease Year. Notwithstanding any
of the foregoing, Tenant shall have no further liability to make any payments of Development
Term Rent, Construction Term Rent or Production Term Rent under this Agreement following its
termination or expiration. If the first or last Lease Year is less than an entire calendar year, the
Production Term Rent shall be prorated for the applicable portion of such Lease Year.
Section 3.4 Restoration Term Rent. Tenant shall not owe any amounts to Owner as rent
during the Restoration Term.
Section 3.5 Payment Adjustments. If Owner owns less than the full surface estate in all
or any part of the Property, all payments required hereunder shall be reduced to the proportion that
Owner's interest in the Property bears to the full surface estate in the Property, or any portion
thereof.
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Section 3.6 Crop Compensation, Pivot and Drip Irrigation, and CRP. Tenant shall use
its commercially reasonable efforts to avoid damaging Owner's existing cultivated land,
pastureland and pivot or drip irrigation systems ("Irrigation System") if located on the Property.
If Tenant's development of the Project: (a) damages or destroys any of Owner's crops or saw -log
timber on such cultivated land, then Tenant shall reimburse Owner the fair market value for the
year in which the crop damage occurred, as established by Multi -Peril Insurance historic yields for
the ten (10) previous years, for any damage to or displacement of Owner's cultivated crops on the
Property caused by Tenant, (b) damages or destroys any of Owner's pasture land, then Tenant will
reseed the affected areas with grasses and/or natural vegetation in accordance with the reasonable
and customary standards in the area for restoring and reseeding pastureland, or (c) damages or
causes Owner to relocate the Irrigation System, the Tenant shall reimburse Owner for the fair
market value, for the year in which the crop damage occurred, of the cost to relocate, repair or
replace the Irrigation System, whichever cost is less. If Owner is a party to a Conservation Reserve
Program contract ("CRP Contract") with the U.S. Department of Agriculture pursuant to 7 C.F.R.
Part 1410 regarding the Property, then Owner shall provide Tenant with a true and complete copy
of such CRP Contract, together with all amendments and modifications, and if applicable, Tenant
shall reimburse Owner for (a) any rental payments, or portion thereof, Owner would have received
from the U.S. Department of Agriculture but for locating the Project on the Property, and (b) the
penalties and interest, if any (including for any past payments received by Owner that must be
repaid by Owner), assessed by, the U.S. Department of Agriculture as a result of the location of
the Project on the Property. Owner shall cooperate with Tenant in completing and submitting
documents to obtain any exemptions allowed under the Conservation Reserve Program for the use
of the Project on the portions of the Property covered by a CRP Contract. Section 3.6 shall not
apply to Owner's cultivated land, pastureland, and Irrigation System(s) existing after the
Construction Commencement Date or notice to Owner thereof.
Section 3.7 Payment Allocations.
Tenant shall make all payments due under this Agreement to Owner as provided below:
City of Waterloo
715 Mulberry St.
Waterloo, IA 50703
% of each payment: 100%
For the avoidance of doubt, Tenant's failure to make payments pursuant to this Section 3.7
shall not constitute an Event of Default, so long as payment is made to Owner at the address
provided in the Basic Terms and Conditions. Owner acknowledges and agrees that payment of all
sums due under this Agreement pursuant to this Section 3.7 shall satisfy all requirements for the
payment of Rent and other sums required to be made by Tenant under this Agreement.
ARTICLE 4 LEASE RIGHTS
Section 4.1 Additional Lease Rights. If Tenant wishes to obtain from Owner one or
more lease rights on, over, across, along and/or above any real property that is owned or controlled
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by Owner and adjacent to the Property (each, an "Additional Lease Right"), in connection with,
for the benefit of and for purposes incidental to the Project, including the right to install and
maintain on such other real property (i) transmission lines and facilities, both overhead and
underground, which carry electrical energy to and/or from the Project, (ii) communications lines
and facilities, both overhead and underground, which carry communications to and/or from the
Project, and/or (iii) metering equipment, substations, switching stations, solar energy measurement
equipment and control, maintenance and administration buildings that benefit the Project, then
upon request Owner shall grant to Tenant such a lease right in such location or locations as Tenant
may reasonably request, provided that Tenant shall agree to pay to Owner a fee consistent with the
Production Term Rent for the number of acres subject to such Additional Lease Right in addition
to all other amounts payable by Tenant to Owner hereunder.
Section 4.2 Stand -Alone Lease Rights. Owner acknowledges that commercial
operation of the Project may require, from time to time during the Project's existence, additional
lease rights in favor of certain third parties on the Property and on the real property that is owned
by Owner and adjacent to the Property. Accordingly, if the independent system operator with
jurisdiction over the system in which the Project operates, the transmission system owner or
operator to whose transmission lines the Project interconnects, the phone or other communications
provider, or the off -taker to whom output and/or renewable energy credits from the Project is to
be sold, determines that one or more separate, stand-alone lease (each, a "Stand -Alone Lease
Right") on, over, across, along and/or above the Property and any real property that is owned by
Owner and adjacent to the Property, including the right to install and maintain on the Property
(i) transmission lines and facilities, both overhead and underground, which carry electrical energy
to and/or from the Project, (ii) communications lines and facilities, both overhead and
underground, which carry communications to and/or from the Project, and/or (iii) metering
equipment, substations, switching stations, solar energy measurement equipment and control,
maintenance and administration buildings that benefit the Project, is reasonably required for the
efficient and/or safe operation of the Project, then upon request Owner shall grant to such third
party such an lease right in such location or locations as such party may reasonably request,
provided that such party shall agree to pay to Owner a reasonable fee agreed to by Owner in
advance for such lease right in addition to all other amounts payable by Tenant to Owner
hereunder.
Section 4.3 Nature of Lease Rights, Additional Lease Rights and Stand -Alone Lease
Rights. Each Lease Right, Additional Lease Right and Stand -Alone Lease Right (i) shall be in the
nature of and similar to the Lease Rights granted to Tenant under Section 2.1 and shall be in a
form reasonably acceptable to Tenant and Owner, such Affiliate or the grantee of such lease rights
as applicable (which form shall at a minimum include lender protective provisions comparable to
those included herein), (ii) shall be a lease right in favor of Tenant or such other holder of such
lease right, and (iii) shall, upon the granting thereof, be included within the meaning of the term
"Lease Rights", except where otherwise stated or where the context otherwise requires. Each
Lease Right, Additional Lease Right and Stand -Alone Lease Right shall inure to the benefit of and
be binding upon Owner and the holder of such Lease Right, Additional Lease Right or Stand -
Alone Lease Right, as the case may be, and their respective successors and assigns, and all persons
claiming under them.
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Section 4.4 Separate Storage Leases.
If Tenant from time to time so requests and provided that no uncured Event of Default then
exists under this Agreement, Owner shall promptly execute and deliver to Tenant or an Affiliate
selected by Tenant one (1) or more separate, independent lease agreements for separate and distinct
battery energy storage projects to be located on the Property, which separate, independent lease
agreements shall be on substantially the same terms and in substantially the same form as this
Agreement.
ARTICLE 5 PERMITTED USE; RIGHTS OF PARTIES; DEVELOPMENT
PROGRESS
Section 5.1 Permitted Use. Tenant shall use the Property solely for solar energy
purposes, and Tenant shall also have the exclusive right to use the Property for solar energy
purposes. "Solar energy purposes" means converting solar energy into electrical energy, and
collecting, storing and transmitting the electrical energy so converted, together with any and all
other activities related thereto, including (i) determining the feasibility of solar energy conversion
on the Property, including studies on solar irradiance, light direction and other meteorological data
and extracting soil samples, and all other testing, studies or sampling desired by Tenant;
(ii) constructing, installing, using, replacing, relocating, controlling and removing from time to
time, and maintaining and operating the Project; and (iii) undertaking any other activities, whether
accomplished by Tenant or a third party authorized by Tenant, that Tenant reasonably determines
are necessary, useful or appropriate to accomplish any of the foregoing, including the right to erect,
construct, reconstruct, replace, relocate, remove, control, maintain and use Transmission Facilities
from time to time in connection with the Project.
Section 5.2 No Required Construction or Production. Nothing contained in this
Agreement shall be construed as requiring Tenant (i) to undertake construction or installation or
to alter or remove any part of the Project on the Property or elsewhere except for those
requirements contained in Section 6.6 hereof, (ii) to continue operation of any part of the Project
from time to time located on the Property or elsewhere or (iii) to generate or sell any minimum or
maximized amount of electrical energy from the Property; and the decision if, when and to what
extent that such construction and generation will occur shall be solely in Tenant's discretion.
Owner acknowledges that Tenant has made no representations or warranties to Owner, including
any regarding development of, or the likelihood of power generation from, the Property.
ARTICLE 6 TENANT'S OBLIGATIONS
Section 6.1 Compliance with Law. In conducting its Operations on the Property, Tenant
shall comply in all material respects with all Laws; however, Tenant may contest the validity or
applicability of any Law (including any property tax) to Tenant, the Project, the Operations, or any
other activity or property of Tenant or Tenant's Affiliate, by appropriate legal proceedings brought
in the name of Tenant or in the names of both Tenant and Owner where appropriate or required.
Any such contest or proceeding, including any initiated by Tenant and maintained in the name of
Owner, shall be controlled and directed by Tenant, but in consultation with Owner and at no cost
to Owner, excepting proceedings which arise due to Owner's violation of any law. Tenant agrees
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to promptly reimburse Owner for any costs or fees (including reasonable attorney's fees) incurred
by Owner in connection with this Section.
Section 6.2 Location of Project and Care and Appearance. Tenant shall notify and
reasonably consult with Owner regarding the location of the Project on the Property prior to the
Construction Commencement Date; provided however, (i) such consultation is advisory only,
(ii) Tenant shall not be restricted in any way from exercising Tenant's rights hereunder as a result
of such consultation, and (iii) Tenant shall not be required to obtain Owner's approval or consent
to the location of any part of the Project. Tenant shall bury all wires, cables and lines on the
Property that are required to be buried at least twenty-four inches (24") below the surface of the
Property. If such wires, cables, or lines become exposed at the surface or are not buried at least
twenty-four inches (24") below the surface regardless of the cause, Tenant shall take all actions
necessary to cause the wires, cables, and lines to be buried at least twenty-four inches (24") below
the surface of the Property. Where commercially feasible, Tenant agrees to (x) install all overhead
lines along existing transmission or utility easements and (y) bury collection cables and fiber optic
cables either underneath or alongside newly -constructed roads. Tenant shall keep the Property
clean and free of debris created by Tenant, its contractors, or others entering the Property at the
request of Tenant. Tenant shall not use the Property for storage except for materials, construction
equipment and vehicles directly associated with construction or maintenance of the Project on the
Property or adjacent lands that are part of the Project and Tenant shall have the right to designate
for use in this regard during the construction and development process (or at any time thereafter)
such laydown yards or areas as it shall determine to be appropriate given the then current nature
of the Operations. Tenant shall take commercially reasonable steps to maintain the grass on the
Property in compliance with the Owner's wildlife hazard management plan at Tenant's sole cost
and expense.
Section 6.3 Fences and Gates. Tenant shall have the right to remove fences, gates, and
cattle guards, but only as reasonably necessary to accommodate the Project; however, upon
Owner's reasonable request, Tenant shall maintain, repair or replace any fences, gates, or cattle
guards, damaged or removed in connection with Tenant's activities. Any fences, gates, or cattle
guards repaired or replaced by Tenant shall be in conformance with the quality and style of the
fences, gates, and cattle guards existing on, or if none are on then nearby, the Property. Fences
removed from locations within the Property where Tenant has determined removal is necessary to
avoid interference with its Operations, if replaced, shall be rebuilt by Tenant at its expense in other
mutually agreeable locations and sufficient to withstand Tenant's uses for the Operations and of
not less than the same style and quality installed by Owner elsewhere on the Property. Once
completed, all replacement fences, gates and cattle guards shall be owned and maintained by
Owner. If Tenant makes a new entrance through any existing fence, Tenant shall install a cattle
guard sufficient to withstand Tenant's uses for the Operations and of not less than the same style
and quality installed by Owner elsewhere on the Property. Tenant will reseed areas cleared by
Tenant and used for lay -down or storage areas with the same types of grasses or crops found on
adjacent tracts if Owner reasonably requests such reseeding.
Section 6.4 Operations. During the Development Term, Tenant may access the
Property following prior notice to the Owner (which notice may be oral), except in the event of an
emergency, where no prior notice shall be required. During the Construction Term and the
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Production Term, Tenant shall have access to the Property twenty-four (24) hours a day, seven (7)
days a week, without prior notice to Owner. Tenant and all Tenant personnel, and all personnel
of third parties authorized to enter the Property by Tenant, shall follow the following rules while
on the Property. Any individual who commits a third violation of these rules after receipt of written
warning from Owner, may be fined in an amount not to exceed $500.00 per violation for each
violation of these rules after receipt of written warning from Owner for the first and second
violations.
(a) All access gates shall remain padlocked at all times when not in use; all
access gates, as well as all interior gates, shall remain closed at all times when not in use.
(b) All personnel shall minimize, to the extent reasonably possible, the creation
of dust and the introduction of noxious plants or vegetation to the Property.
(c) At no time shall any of employees of Tenant, or any third parties authorized
to enter the Property by Tenant bring any of the following onto the Property:
(i) Weapons of any type, including but not limited to, guns, bows and
arrows, or sling shots.
(ii) Animal calling devices.
(iii) Fishing equipment or nets.
(iv) Dogs, cats or any other animals.
(v) Alcoholic beverages.
(vi) Illegal drugs or related paraphernalia.
(d) Smoking is prohibited except in designated construction areas and in
vehicles. Tenant will employ prudent precautions to prevent fires, including avoiding the build-
up of plant material under vehicles. In the event a grass fire is started, Owner shall be promptly
notified, as well as emergency personnel if necessary. Tenant agrees to pay to Owner a reasonable
fee per acre for fire damage but not less than $50.00 per acre for fire damage to existing crops
and/or pasture land (whether located on the Property or adjacent lands owned by Owner) that is
caused by Tenant, its employees, contractors, agents or any individual allowed onto the Property
by Tenant. Such payment shall be due and payable within thirty (30) days of such fire. Such
payment shall in no way limit or waive Owner's right to obtain payment for fire damage to animals,
structures, equipment or other things located on the Property, or lands adjacent to the Property.
(e) Tenant shall keep the Property clean and free of all trash and litter which
may emanate from Tenant or its employees, agents, contractors or invitees operations on the
Property, and if Tenant does not do so within ten (10) days after written notice from Owner, Tenant
agrees to pay Owner's reasonable costs of picking up such litter and trash either on the Property
or adjacent lands. Under no circumstances will Tenant bury or burn any trash, debris or foreign
material of any nature on the Property.
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(f) Tenant, its employees, contractors, agents and any individual allowed onto
the Property by Tenant shall not bury, dump, spill or discharge any Hazardous Materials (as
defined in Section 10.2), gasoline, oil, hydraulic fluid, fuel, paint or other foreign, toxic, or other
waste substances on the Property.
(g) No wood, plants, animals (dead or alive), artifact or any other item that was
not originally brought onto the Property by Tenant's personnel will be removed from the Property.
(h) The following speed limits shall be strictly observed while using roads on
the Property: thirty-five (35) miles per hour during daylight; twenty-five (25) miles per hour after
dark.
Section 6.5 Payment of Claims. Tenant shall pay, when due, all claims for labor or
materials furnished to or for Tenant at the Property, which claims are secured by any mechanic's
or materialmen's lien against the Property; however, Tenant may contest such claims by
appropriate legal proceedings brought in the name of Tenant or in the names of both Tenant and
Owner where appropriate or required, so long as Tenant pays and satisfies any adverse judgment
that may be rendered thereon before the enforcement thereof. Any such contest or proceeding,
including any maintained in the name of Owner, shall be controlled and directed by Tenant.
Section 6.6 Restoration. Subject to the rights of Lenders upon termination of this
Agreement as provided herein, and subject to the rights of Lease Right holders as provided in
Article 4, during the Restoration Term, Tenant shall complete the Restoration Obligations;
provided however, the Restoration Obligations shall not include the replanting of trees, removing
of access roads or regrading to existing conditions, and, as to any part of the Project located beneath
the surface of the land, Tenant shall only be required to remove any part of the Project located
beneath the surface of the land (such as, without limitation, footings and foundations) to a depth
of twenty-four (24) inches below the surface of the land. Nothing contained in this Section shall
be construed as precluding Tenant from taking any of the foregoing actions at any time during the
Development Term, the Construction Term, or the Production Term. No less than thirty (30) days
prior to the commencement of the Restoration Term, Tenant shall provide to Owner and maintain
during the remainder of the Term one or more performance bonds, letters of credit, or another form
of financial security in such type and amount determined in the Tenant's discretion, in each case
in form and substance to secure Tenant's completion of the Restoration Obligations. The amount
of any financial security maintained by Tenant pursuant to the prior sentence shall be reduced by
the scrap and salvage value of the Project. In the event any federal, state, county or local
governmental authority with jurisdiction over the Project or the Property requires bonding or other
security securing decommissioning and the Restoration Obligations, then Tenant's satisfaction of
those requirements shall satisfy all bonding or other security requirements under this Section 6.6.
No less than thirty (30) days prior to the commencement of the Restoration Term, Tenant shall
provide to Owner a decommissioning plan for Tenant's satisfaction of the Restoration Obligations.
Section 6.7 Taxes. Tenant shall pay prior to delinquency any property taxes levied and
assessed by any governmental authority upon any part of the Project placed on the Property by
Tenant. Owner shall pay when due any taxes attributable to (a) improvements or facilities installed
by Owner or others (excluding Tenant) on the Property and (b) the underlying value of the
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Property; provided, however, that if, following the Construction Commencement Date, the taxes
against the underlying value of the Property are increased by reason of a change of use
determination by a taxing entity (including roll -back taxes assessed up to five (5) years after
termination or expiration of this Agreement, provided Owner uses good faith efforts to obtain
agricultural exemptions, if applicable, during such time) or increased assessment of the Property
resulting from Tenant's Operations or any part of the Project thereon, then Tenant shall pay the
entire amount of such increase so attributable. Owner and Tenant agree that during the
Development Term hereof, no change in Owner's agricultural activities on the Property is required
by this Agreement. Owner shall submit any real property tax bill regarding the Property and/or the
Project (and any other communication from any government authority regarding the same) to
Tenant within thirty (30) days after Owner's receipt thereof from the taxing authority. If any taxes
payable by Tenant hereunder are levied or assessed in the name of Owner as part of the real
property taxes payable by Owner, then, within thirty (30) days after Owner submits the real
property tax bill to Tenant, Tenant shall reimburse Owner for all such taxes payable by Tenant
hereunder. Tenant's obligations hereunder are subject to Tenant's right to contest pursuant to
Section 6.1 and hereunder. Tenant shall have the right, in its sole discretion, to contest by legal
proceedings (which may be brought in the name(s) of Owner and/or Tenant where appropriate or
required), the validity or amount of any assessments or taxes for which Tenant is responsible
hereunder. Owner shall in all respects cooperate with Tenant in any such contest.
ARTICLE 7 OWNER'S OBLIGATIONS
Section 7.1 No Interference.
(a) Among the Lease Rights granted and conveyed by Owner to Tenant is the
exclusive right to the flow of sunshine and solar irradiation to and across the Property. Owner
covenants that neither Owner nor any other Person (other than Tenant and Persons claiming
through or under Tenant) shall obstruct or interfere with such Lease Right for the free flow of
sunshine and solar irradiation throughout the entire area of the Property ("Irradiation Lease
Right"), which shall consist of horizontally three hundred and sixty degrees (360°) from each point
within the Property where the Project is or may be located at any time or from time to time to the
boundaries of the Property, and vertically through all space above the surface of the Property.
(b) Accordingly, neither Owner's activities nor the exercise of any rights
hereafter given or granted by Owner to any other Person (whether exercised on the Property or
elsewhere), shall materially interfere with Tenant's then -existing lease or other rights relating to
(i) access by Tenant or its Affiliates or contractors to the Property or any lands in the vicinity of
the Property used by Tenant in the Operations associated with the Project, (ii) Operations of Tenant
or its Affiliates or contractors on the Property or on any lands owned by Owner in the vicinity of
the Property, (iii) the exercise of Tenant's rights under this Agreement, or (iv) the undertaking of
any other activities permitted by Tenant hereunder.
(c) Without limiting the generality of the foregoing, for so long as this
Agreement is in effect, Owner covenants that, to ensure the Irradiation Lease Right referenced in
Section 7.1(a), neither Owner nor any other Person that has obtained rights either from Owner or
any party claiming, directly or indirectly, under Owner, shall interfere with solar irradiation or
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light direction over the entire Property or any lands owned or controlled by Owner in the vicinity
of the Property on which Tenant or any Affiliate thereof owns, leases, operates or maintains
Solarpower Facilities, and Owner shall not plant trees or construct buildings or other
improvements that will adversely affect the full Irradiation Lease Right, or engage in any other
activity on the Property or elsewhere, that might cause a decrease in the output or efficiency of
any of the Solarpower Facilities. The parties acknowledge and agree that the grant of the
Irradiation Lease Right and the covenants by Owner contained in this Agreement are a material
inducement for Tenant to enter into this Agreement, and each of the parties acknowledge and
recognize that a violation of the terms hereof will cause irreparable damage to Tenant and Tenant
may have no adequate remedy at law for such violation. Accordingly, each of the parties agrees
that Tenant shall be entitled, as a matter of right, to an injunction from any court of competent
jurisdiction restraining any violation of such covenants and to specifically enforce Tenant's
exclusive right to the Irradiation Lease Right. This right to injunctive relief will be cumulative
and in addition to whatever remedies Tenant may otherwise have at law.
(d) In the event that Owner becomes a party to an oil and gas lease or sub-
surface agreement or mineral interest lease or sub -surface agreement affecting the Property that is
executed after the date hereof, Owner agrees to include surface use provisions in such oil and gas
or mineral interest lease or surface agreement substantially as follows:
Lessee agrees that its lease is subordinate and subject to all leases, lease rights and
easements that are of record as of the date of this Lease. Further, lessee covenants and
agrees that lessee shall take all reasonable actions to accommodate the use of the surface
of the leased property by the surface owner or other persons or entities having rights of
use of the surface of the leased property, regardless of whether such uses or rights of use
arise before or after the date of this lease. Lessee shall not have the right to damage,
relocate, or remove any surface structure or improvement, without the express written
consent of the owner of such structure or improvement, regardless of when such surface
structure or improvement was constructed or installed.
Lessee acknowledges that lessor and third parties ("Energy Tenant," whether one or more)
may execute one or more agreements, contracts, leases, or easements affecting the leased
property authorizing the operation of solar power projects for generating electricity and
related facilities on the leased property. Lessee agrees to fully cooperate with any Energy
Tenant with regard to the use of the leased property. Lessee agrees to fully compensate
any Energy Tenant for any damage caused by lessee to the facilities or property of such
Energy Tenant.
Lessee shall not drill any well or perform any subsurface activity within 300 feet of any
solar power generating unit located on the leased property.
Section 7.2 Compliance with Obligations. Owner shall comply on a timely basis with
all of its legal and contractual obligations with respect to the Property, including the payment
before delinquency of property taxes that are attributable to the underlying value of the Property
or improvements thereon not owned by Tenant. If Owner fails to do so, then, without limitation
upon any other rights or remedies that Tenant may have at law or in equity, Tenant may (but shall
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not be obligated to) pay or otherwise satisfy any unpaid property taxes or other obligations of
Owner which, if left unsatisfied, could delay, interfere with, impair or prevent Operations or the
exercise of any of Tenant's other rights under this Agreement, or the financing of the Project; and
Tenant shall thereupon be subrogated to the rights of the obligee of such obligations. Without
limitation on any other rights or remedies available to Tenant, any sums so expended by Tenant
shall, at Tenant's election, either be (i) immediately reimbursed to Tenant by Owner or (ii) offset
against any Rent or other amounts then or thereafter due and payable to Owner under this
Agreement.
Section 7.3 Rights of Third Parties.
(a) From and after the Effective Date, any right, title or interest created by
Owner in favor of or granted to any third party shall be subject to (i) this Agreement and all of
Tenant's rights, title and interests created hereby, (ii) any Lender's Lien then in existence on the
leasehold estate created by this Agreement, (iii) Tenant's right to create a Lender's Lien and
(iv) any and all documents executed or to be executed by Tenant in connection with this
Agreement.
(b) If at any time during the Term any Encumbrance to Owner's title to the
Property which was created prior to the Effective Date is found, exists or is claimed to exist against
the Property or any portion thereof, creates rights superior to those of Tenant, and Tenant in its
sole discretion determines that the existence, use, operation, implementation or exercise of such
Encumbrance could delay, interfere with, impair or prevent Operations or the exercise of any of
Tenant's other rights under this Agreement or the financing of the Project, Tenant shall be entitled
to seek to obtain a subordination, non -disturbance agreement, consent or other agreement,
including a recognition agreement in favor of any Lender (in a form and containing provisions
reasonably acceptable to Tenant or its Lenders) from the holder of such Encumbrance that will
eliminate such risks for the benefit of Tenant, and Owner shall use its best efforts to assist Tenant
in connection therewith.
Section 7.4 No Ownership Rights. Owner acknowledges and agrees that (i) Tenant is
and shall remain the exclusive owner and operator of the Project, which is Tenant's personal
property and which shall not be deemed a fixture, (ii) Owner has no right or interest in or to the
Project, (iii) Owner may not sell, lease, assign, mortgage, pledge or otherwise transfer, alienate or
encumber the Project with the fee interest or leasehold or other rights in or to the Property or
otherwise; and (iv) notwithstanding anything to the contrary herein, Tenant has the right to remove
the Project and its other personal property from the Property at any time and from time to time,
including upon the expiration or earlier termination of this Agreement, in accordance with Section
6.6. Without limiting the generality of the foregoing, Owner hereby waives any statutory or
common law lien that it might otherwise have in or to the Project or any part thereof. Any and all
solar resource data collected by or on behalf of Tenant after the Effective Date is the sole property
of Tenant. The solar resource data shall be Confidential Information.
Section 7.5 Cooperation.
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(a) Owner shall fully support and cooperate (and shall use reasonable efforts to
cause any other Person with any other right, title or interest in the Property to cooperate) with
Tenant in the conduct of its construction and Operations and in otherwise giving effect to the
purpose and intent of this Agreement, including in Tenant's efforts to obtain from any
governmental authority or any other Person any environmental impact review, permit, entitlement,
approval, authorization or other rights necessary or convenient in connection with construction
and Operations; and Owner shall (and shall use reasonable efforts to cause any such other Person
to) promptly upon request, without demanding additional consideration therefor, execute, and, if
appropriate, cause to be acknowledged and recorded, any map, application, permit or document
that is reasonably requested by Tenant in connection therewith (as well as any amendment to this
Agreement or any recordable memorandum executed in connection herewith for purposes of
correcting or replacing property descriptions based on surveys or other relevant information
obtained after the Effective Date, or making other non -substantive corrections, additions or
substitutions). Without limiting the generality of the foregoing, in connection with any application
by Tenant for a governmental permit, approval, authorization, entitlement or other consent, Owner
agrees (and shall use reasonable efforts to cause any such other Person to agree) not to oppose, in
any way, whether directly or indirectly, any such application or approval at any administrative,
judicial or legislative level. Further, in the event of legal proceedings related to Tenant's use of the
Property after the Effective Date, except those arising out of the interpretation and/or enforcement
of the Agreement, Owner shall, in all respects, fully cooperate with Tenant in any such proceeding.
Owner agrees that Tenant may provide the Memorandum of Lease Agreement in lieu of any
affidavit by Owner or other form of Owner's consent (whether oral or written) that may be
requested or required in connection with Tenant's efforts to obtain any environmental impact
review, permit, entitlement, approval, authorization, agreement or other rights necessary or
convenient in Tenant's discretion for the Project.
(b) Owner shall, promptly after the Effective Date, make available to Tenant
copies of any and all surveys that relate to the Property (to the extent such information relates
directly to the proposed Project) to the extent that the same are in Owner's possession or under its
control. Upon request from Tenant, Owner shall cooperate with Tenant's efforts to obtain
subordination and/or non-interference agreements with the holders of any mineral interests or other
parties having any surface rights to the Property. Owner shall provide Tenant with all information
in Owner's possession reasonably required by Tenant to make contacts with such holders and to
negotiate such agreements, including the names, addresses and phone numbers of contact persons
and the locations of any other holder's or party's equipment, improvements, or facilities located
or proposed to be located on the Property.
(c) Owner shall cooperate with Tenant in its development of the Project by
avoiding the pasturing of animals on or near portions of the Property at which Tenant's
construction, removal, maintenance or other similar activities are occurring.
(d) Owner shall not obstruct passage along, into or from any road or area within
the Property that is accessed in connection with the Operations, except that Owner may fence and
gate such areas and gate roads if it provides the keys or combinations to Tenant for any gate locks.
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(e) Prior to the Construction Commencement Date, Owner shall remove any
tangible personal property (e.g. goods, equipment, inventory, vehicles, trailers, farm implements,
farm animals, parts/accessories, barrels/containers, discard/rubbish materials, etc.) from the
Property.
Section 7.6 Setback Waiver. To the extent that (i) Owner now or in the future owns or
leases any land adjacent to the Property, or (ii) Tenant or any Affiliate thereof owns, leases or
holds an easement over land adjacent to the Property and has installed or constructed or desires to
install or construct any part of the Project on said land at and/or near the common boundary
between the Property and said land, Owner hereby waives any and all setbacks and setback
requirements, whether imposed by law or by any Person, including any setback requirements
described in any applicable zoning ordinance or in any governmental entitlement or permit
heretofore or hereafter issued to Tenant or such Affiliate. Further, if so requested by Tenant or
any such Affiliate, Owner shall promptly, without demanding additional consideration thereof,
execute, and if appropriate cause to be acknowledged and recorded, any setback waiver, setback
elimination or other document or instrument required by any governmental authority or that Tenant
or such Affiliate deems necessary or convenient to the obtaining of any entitlement or permit.
Section 7.7 Confidentiality. Subject to any duties imposed by law by reason of
recordation of the Memorandum of Lease Agreement, Owner shall hold in confidence, and shall
require its principals, officers, employees, representatives and agents to hold in confidence, for the
sole benefit of Tenant, (i) any accountings, (ii) all information pertaining to the Rent and to
calculation of Rent payments (including the sale price of power), (iii) any other financial
information provided by or on behalf of Tenant, (iv) any books, records, computer printouts,
product designs or information regarding Tenant or an Affiliate thereof and (v) any information
regarding resource assessment, energy output or availability from Operations on the Property
(collectively, "Confidential Information"), whether disclosed by Tenant or an Affiliate thereof
or discovered by Owner, unless such Confidential Information either (i) is in the public domain by
reason of prior publication through no act or omission of Owner or its principals, officers,
employees, representatives or agents, or (ii) was already known to Owner at the time of disclosure
and which Owner is free to use or disclose without breach of any obligation to any Person. Owner
shall not use any such Confidential Information for its own benefit, publish or otherwise disclose
such Confidential Information to others, or permit the use of such Confidential Information by
others for their benefit or to the detriment of Tenant. Notwithstanding the foregoing, Owner may
disclose such information to (1) Owner's lenders, attorneys, accountants and other personal
financial advisors, or (2) any prospective purchaser of the Property; provided that in making such
disclosure Owner advises the party receiving the information of the confidentiality thereof and
obtains the agreement of said party to abide by the confidentiality provisions above, and Owner
shall be responsible to Tenant for any failure of any such third party to do so. Owner may also
disclose such information pursuant to any lawful subpoena or court order, in which case Owner
shall give Tenant sufficient advance notice of such proceedings to allow Tenant to oppose the
issuance of the same (or, if this is not possible, as much notice as is practicable). Notwithstanding
the foregoing, certain Laws, such as Iowa Code Chapter 22, may require the disclosure of certain
information or materials otherwise classified as Confidential Information, and no provision of this
Agreement shall be construed to preclude Owner from disclosing information or materials that is
required to be disclosed pursuant to any Laws, including but not necessarily limited to Iowa Code
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Chapter 22; provided, however, that prior to such disclosure required pursuant to any Laws, Owner
shall promptly notify Tenant in writing of the request for disclosure and provide Tenant with copies
of all relevant documents related to the request for disclosure and allow Tenant to take any and all
actions Tenant deems necessary and appropriate to protect its Confidential Information, including,
but not limited to, intervening in any legal proceedings related to the disclosure of the Confidential
Information.
Section 7.8 Division of Lease. If Tenant from time to time so requests and provided
that no uncured Event of Default then exists under this Agreement, Owner shall promptly divide
the Agreement into two (2) or more separate, independent agreements for separate and distinct
solar power projects by entering into two or more new agreements that provide Tenant with
separate leasehold rights to different portions of the Property, as designated by Tenant. Each of
such new agreements shall (i) contain the same terms and conditions as this Agreement (except
for any requirements that have been fulfilled by Tenant prior to the execution of such new
agreements), (ii) be for a term equal to the remaining Term, (iii) contain a grant to Tenant of rights
similar to the Lease Rights, covering such portion or portions of the overall Property as Tenant
may designate, (iv) require payment to Owner of only a proportionate amount of Rent, and
(v) enjoy the same priority as this Agreement over any Encumbrance created by Owner. Further,
in the event of an uncured Event of Default (as defined below) by the Tenant under any such new
agreement, such default shall not affect, or cause a termination of, this Agreement or any other
separate new agreement.
Section 7.9 Estoppel Certificates. Owner shall, within twenty (20) days after request
by Tenant or any Lender, execute and deliver an estoppel certificate substantially in the form of
Exhibit D, attached hereto, (i) certifying (if true) that this Agreement is in full force and effect and
has not been modified, (ii) certifying (if true) that to the best of Owner's knowledge there are no
uncured Events of Default hereunder, and no condition or event exists which, with the passage of
time, would become an Event of Default (or, if any uncured Events of Default or any such
conditions or events exist, stating with particularity the nature thereof), (iii) certifying the status of
any conditions subsequent provided in this Agreement and (iv) containing any other certifications
as may reasonably be requested. Any such statements may be conclusively relied upon by Tenant
and any existing or proposed Lender. The failure of Owner to deliver any estoppel certificate
within such time shall be conclusive upon Owner that (i) this Agreement is in full force and effect
and has not been modified, (ii) there are no uncured Events of Default by Tenant hereunder, and
no conditions or events exist which, with the passage of time, would become an Event of Default,
(iii) any conditions subsequent set forth in this Agreement have been satisfied (except to the extent
that such satisfaction, by the terms of this Agreement, is not due to occur until a future date) and
(iv) the other certifications so requested are in fact true and correct.
Section 7.10 Representations and Warranties of Owner. Owner hereby represents and
warrants to Tenant that, as of the Effective Date:
(a) (i) Owner is the sole fee owner of the Property (or the lesser interest
designated in the Basic Terms and Conditions, as the case may be), and Owner's ownership interest
is subject to no Encumbrances or any agreements that could affect Tenant's use, possession or
occupancy of the Property except those filed in the Real Property Records and those unrecorded
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tenancies, lease agreements, claims of lease, or other occupancies or rights of Possession as
enumerated in Exhibit B hereto, true and correct copies of which have been provided to Tenant,
(ii) each Person signing this Agreement on behalf of Owner is authorized to do so, (iii) Owner has
the full and unrestricted legal power, right and authority to enter into this Agreement, to grant the
Lease and the Lease Rights to Tenant and to perform its obligations hereunder, (iv) no other Person
(including any spouse) is required to join in this Agreement in order for the same to be fully
enforceable by Tenant and for Tenant to enjoy all the rights and benefits accorded to it hereunder,
(v) this Agreement, the Lease and the Lease Rights are and will be in full force and effect, without
the necessity of any consent of or joinder herein by any other Person, (vi) this Agreement
constitutes the valid and binding obligation of Owner, and is enforceable in accordance with its
terms and (vii) Owner is not the subject of any bankruptcy, insolvency or probate proceeding.
(b) To the best of Owner's knowledge, neither this Agreement nor the Property
or any portion thereof is in violation of any Law. Each parcel of the Property is a separate legal
parcel which may be developed, leased and financed in compliance with applicable subdivision
laws and all local ordinances adopted pursuant thereto.
(c) To the best of Owner's knowledge, there are no pending or threatened
actions, suits, claims, legal proceedings or any other proceedings affecting or that could affect the
Property or any portion thereof, at law or in equity, before any court or governmental agency.
(d) To the best of Owner's knowledge, there are no commitments or agreements
with any governmental agency or public or private utility affecting the Property or any portion
thereof that have not been disclosed by Owner to Tenant and listed on Exhibit B hereto.
(e) To the best of Owner's knowledge, there are no other material adverse facts
or conditions relating to the Property or any portion thereof that could delay, interfere with, impair
or prevent Operations or the exercise of any of Tenant's other rights under this Agreement, the
Lease or the Lease Rights, or the financing of the Project.
(f) To the best of Owner's knowledge, the Property is not enrolled in any and
does not benefit from any tax abatements, reduced tax assessments, or other tax programs that are
reasonably expected to be lost as a result of the construction and operation of the Project on the
Property, resulting in an increase in taxes assessed against the Property.
(g) Notwithstanding any other term or provision of this Agreement, except as
expressly set forth in this Agreement, Owner does not provide any warranty or representation with
respect to the condition of the Property or its suitability for Tenant's desired uses, and Owner does
not, and cannot, provide any warranty or representation that Tenant will be issued or obtain all
required or necessary permits, licenses, or approvals as required under any Laws. Owner shall
reasonably support and cooperate with efforts undertaken by Tenant to secure any such required
or necessary permits, licenses, or approvals (see Section 7.5).
ARTICLE 8 DEFAULT; REMEDIES; PROTECTION OF LENDERS
Section 8.1 Default.
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(a) Except as qualified by Section 8.2 and 8_4, if Tenant fails to perform its
obligations under this Agreement (an "Event of Default"), then Owner shall have the right to seek
actual monetary damages, specific performance, and/or injunctive relief if Tenant shall have failed
to cure such Event of Default, within thirty (30) days in the case of a Monetary Default or within
one hundred twenty (120) days in the case of a Non -Monetary Default, after Tenant has received
written notice from Owner stating with particularity the nature and extent of such Event of Default
and each Lender has received a duplicate copy of such notice as required by Section 8.4 (a "Notice
of Default"); provided, however, that, in the case of a Non -Monetary Default, if the nature or
extent of the obligation or obligations is such that more than one hundred twenty (120) days are
required in the exercise of commercially reasonable diligence for performance of such
obligation(s), then Tenant shall not be in default if Tenant commences such performance within
such one hundred twenty (120) day period and thereafter pursues the same to completion with
commercially reasonable diligence. For purposes hereof, a "Monetary Default" means an Event
of Default consisting of the failure to pay when due any Rent or other monetary obligation of
Tenant to Owner under this Agreement and any other Event of Default is sometimes referred to
herein as a "Non -Monetary Default."
(b) Owner's failure to perform any one of the following shall constitute an
event of default of Owner ("Owner Event of Default"): (i) failure of any representation or
warranty made by Owner in this Agreement to be true and correct in all material respects at any
time during the Term, or (ii) the failure to comply with any provision of this Agreement, and such
failure shall continue uncured for thirty (30) days after notice thereof by Tenant, provided that
Owner is using commercially reasonable efforts to pursue such cure and provided, further, if such
failure is not capable of being cured within such period of thirty (30) days with the exercise of
reasonable diligence, then such cure period shall be extended for an additional reasonable period
of time so long as Owner is exercising commercially reasonable efforts to cure such failure. Upon
the occurrence and during the continuation of an Owner Event of Default, Tenant: (i) shall have
the right to pursue any and all remedies under this Agreement, at law or in equity and (ii) may
terminate this Agreement. The failure to obtain any permit, license, or approval, as required by
any Laws by Tenant, shall not be a default of Owner.
Section 8.2 Owner's Right to Terminate for Monetary Default.
(a) If and only if a Monetary Default shall occur, and such Monetary Default is
not disputed in good faith by Tenant or a Lender through implementation of the escrow described
in (b) below, then notwithstanding anything to the contrary contained in this Agreement, Owner
may terminate this Agreement while such Monetary Default is still continuing if both of the
following occur:
(i) Tenant fails to cure the Monetary Default within thirty (30) days
after receipt of the written Notice of Default from Owner (with a simultaneous duplicate
copy to each Lender as set forth in Section 8.1(a) and Section 8.4), and then Tenant fails
to cure the Monetary Default within thirty (30) days after receipt of a second Notice of
Default from Owner (with a simultaneous duplicate copy to each Lender), which states in
14 point bold and all capitalized print at the top of the first page of the Notice of Default:
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NOTICE OF DEFAULT: FAILURE TO RESPOND COULD RESULT IN
TERMINATION OF LEASE, and
(ii) all Lenders fail to cure the Monetary Default within the forty five
(45) day period permitted to them after receipt of their duplicate Notice of Default, all
pursuant to Section 8.4.
(b) If Owner alleges that a Monetary Default has occurred but Tenant or any
Lender, in good faith, disputes Owner's contention, Tenant or such Lender may deposit the amount
in controversy in escrow with any reputable third party escrow agent, or may interplead the same,
which amount shall remain undistributed until final, non -appealable decision by a court of
competent jurisdiction or agreement of the parties.
(c) Upon termination or expiration of this Agreement, and in connection with
any Event of Default for which Owner has terminated this Agreement, Owner shall be entitled to
pursue any and all remedies or relief provided under this Agreement or otherwise available to
Owner under Iowa law, including but not limited to, any action of any kind to evict, eject, or
remove the Tenant or any of its property or assets from the Property, including but not limited to
specific performance, or for damages. The Restoration Obligations of Tenant shall survive
termination or expiration of this Agreement and, without limiting this subsection (d), Owner shall
be entitled to commence an action of any kind to seek recovery of damages or other relief in
connection with Tenant's failure to perform its Restoration Obligations as required under this
Agreement. Any remedies or relief available to Owner shall survive any termination of this
Agreement.
Section 8.3 Limitation on Remedies. Except as otherwise expressly set forth in this
Section 8, at all times after the Construction Commencement Date, Owner shall not (and hereby
waives the right to) seek or commence any action or proceeding involving ejectment, eviction,
removal of the Project from the Property, or any other similar remedy or rescission or reformation
of this Agreement, and Owner shall be limited to the remedies authorized in Section 8.1 and 8.2
based on the type of Event of Default (Monetary or Non -Monetary); to be clear, Owner may only
terminate this Agreement for uncured Monetary Default in accordance with Section 8.2. Each of
the parties hereby waives any right to recover consequential damages, indirect or special damages
or lost profits. except as otherwise permitted by this Agreement, and further subject to the
qualification that any damages that arise directly from a default with respect to an obligation of
Tenant or Owner shall not be construed as being an item of consequential damages or an indirect
or special item of damages. In any event, however, lost revenue or loss profits shall not be
recoverable.
Section 8.4 Protection of Lenders.
(a) If Tenant has assigned, hypothecated, mortgaged or pledged all or any
portion of its right, title or interest under this Agreement, in the Lease, in the Lease Rights and/or
in any portion of the Project, it shall promptly give notice of the same (including the address of
the Lender) to Owner, together with a general description of the interest transferred; provided,
however that the failure to give such notice shall not constitute a default or Event of Default under
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this Agreement but rather shall only have the effect that Owner shall not be required to recognize
or be bound by such assignment, hypothecation, mortgage or pledge (and all notice and other
requirements in this Article 8 benefiting such Lender shall accordingly be inapplicable to Owner)
until such notice shall have been given.
(b) Every Lender shall have the right, but not the obligation, (i) to make any
payments due under this Agreement, and (ii) to do any other act or thing that may be necessary or
appropriate to be done in the performance and observance of the terms hereof. All payments so
made and all things so done and performed by any Lender shall be as effective to prevent or cure
any Event of Default under this Agreement as they would have been if made, done and performed
by Tenant, and Owner agrees to accept such performance, payment and cure. Owner agrees to
accept such payment and performance, and authorizes the performing Lender (or its employees,
agents, representatives or contractors) to enter upon the Property to complete such performance
with all the rights, privileges and obligations of Tenant hereunder.
(c) Owner agrees for the benefit of each Lender that it will not, without the
prior consent of such Lender (which consent shall be given or withheld on the basis of the
documents governing the relationship between such Lender and Tenant): (i) amend or modify, or
take any action causing, consenting to or accepting the amendment or modification of this
Agreement, if such amendment or modification would reduce the rights or remedies of such Lender
hereunder or impair or reduce the security for any Lender's Lien, (ii) by agreement with Tenant,
cancel, terminate or suspend this Agreement, the Lease or the Lease Rights or (iii) take any action
dausing, consenting to or accepting the cancellation, termination or suspension of this Agreement,
the Lease or the Lease Rights.
(d) Owner shall deliver to each Lender a duplicate copy of any and all Notices
of Default that Owner may from time to time deliver to Tenant, and such copies shall be delivered
to each such Lender at the same time such Notices of Default are delivered to Tenant. Failure to
serve a copy of any such Notice of Default to any Lender shall render the Notice of Default to
Tenant ineffective.
(e) Upon Tenant's failure to cure any Event of Default within the time provided
in Section 8.1, the Lenders shall have an additional forty five (45) days (running concurrently for
each Lender) after the expiration of the time provided in Section 8.1 and Section 8.2 to cure such
Event of Default. However, if such Event of Default is a Non -Monetary Default and cannot, in
the exercise of commercially reasonable diligence, be cured within such additional forty-five
(45) day period, then such Lenders shall have such additional time (running concurrently for each
Lender) to cure such Event of Default as may be reasonably necessary using commercially
reasonable diligence. Any Non -Monetary Default that cannot be cured by such Lenders shall
nevertheless be deemed to have been cured and remedied if (i) on or before forty five (45) days
after receiving the Notice of Default from Owner, any such Lender shall have acquired Tenant's
then -remaining right, title and interest in the Property, or shall have commenced foreclosure or
other appropriate proceedings for such purposes and shall be prosecuting such proceedings to
completion with commercially reasonable diligence, (ii) any such Lender shall have fully cured
within such forty five (45) day period any failure to perform any monetary obligations of Tenant
hereunder and shall thereafter continue to perform such monetary obligations, and (iii) after
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obtaining Tenant's then -remaining right, title and interest in the Property, any such Lender
commences performance of the non -monetary obligations of Tenant hereunder and thereafter
pursues the same to completion with commercially reasonable diligence. All rights of Owner to
terminate this Agreement as a result of the occurrence of a Monetary Default hereunder shall be
expressly conditioned upon (i) each such Lender having first received a copy of the Notice of
Default as and when provided in Section 8.4(d) and (ii) such Lenders having together failed to cure
the Event of Default (or, in the case of a Non -Monetary Default, acquire possession of the Property
or commence foreclosure or other appropriate proceedings) as set forth, and within the time
specified, in this Section 8.4(e).
(f) If any such Lender is prohibited by any process or injunction issued by, or
by reason of any action of, any court having jurisdiction over any bankruptcy, reorganization,
insolvency or other debtor -relief proceeding from commencing or prosecuting foreclosure or other
appropriate proceedings, then the times specified in Section 8.4(e) for commencing or prosecuting
such foreclosure or other proceedings shall be extended for the period of such prohibition;
provided, however, that such Lender (or another Lender) shall have fully cured, within the time
specified in Section 8.4(e), any failure to perform any monetary obligations of Tenant hereunder,
and shall thereafter continue to perform such monetary obligations when and as due hereunder.
(g) The transfer of Tenant's interest under this Agreement to any Lender and/or
to one or more purchasers or tenants (i) at a foreclosure sale by judicial or nonjudicial foreclosure
and sale, (ii) by a conveyance by Tenant in lieu of foreclosure or (iii) by any other assignment or
conveyance, including by a Lender following foreclosure and sale, or as a result of any other legal
proceeding, shall not require the consent of Owner, provided that such Lender and/or purchaser
shall provide written notice to Owner of the transfer of Tenant's interest under this Agreement not
later than thirty (30) days thereafter, and Owner agrees that upon such foreclosure, sale,
conveyance, assignment or other proceeding, Owner shall recognize such Lender or such other
purchaser(s) or Tenant(s) as the successor to Tenant under this Agreement; provided, however,
that, subject to Section 8.4(i), such Lender or such purchaser or Tenant assumes the obligations of
Tenant under this Agreement and pays all amounts in arrears due from Tenant to Owner hereunder.
(h) Neither the bankruptcy nor the insolvency of Tenant shall be grounds for
terminating this Agreement. If this Agreement is rejected by a trustee or debtor -in -possession in
any bankruptcy or insolvency proceeding, or if this Agreement is terminated for any reason in
connection therewith, and if, within sixty (60) days after receiving notice of such rejection or
termination, any Lender shall so request, then, so long as such Lender has cured any Monetary
Default and is making commercially reasonable efforts to cure any Non -Monetary Default as
provided herein, Owner shall execute and deliver to such Lender or its designee a new agreement,
which new agreement shall (i) be on the same terms and conditions as this Agreement (except for
any requirements that have been fulfilled by Tenant prior to rejection or termination of this
Agreement), (ii) be for a term equal to the remaining Term before giving effect to such rejection
or termination, (iii) contain a lease of the portion of the Property in which such Lender had an
interest on the date of such rejection or termination, (iv) contain a grant to the Lender of lease
rights similar to the Lease Rights, covering such portion or portions of the overall Property as such
Lender may designate, (v) require payment to Owner of only a proportionate amount of Rent,
(vi) enjoy the same priority as this Agreement over any lien, Encumbrance or other interest created
27
by Owner, and (vii) be executed within thirty (30) days after receipt by Owner of notice of the
Lender's election to enter into a new agreement.
(i) No Lender shall have any duty, obligation or liability under this Agreement
prior to the time of its entry into physical possession of the Property or its commencement of
performance of Tenant's obligations under this Agreement or under a new agreement entered into
as provided in Section 8.4(h). If a Lender elects to perform Tenant's obligations under this
Agreement or to enter into a new agreement as provided in Section 8.4(h), then such Lender shall
not have any personal liability to Owner for the performance of such obligations, and the sole
recourse of Owner in seeking the enforcement of such obligations shall be to such Lender's interest
in the Project and under this Agreement. If a Lender assigns its interest in this Agreement or in a
new agreement entered into pursuant to Section 8.4(h) to any Person, then, provided that such
assignee assumes the obligations of Tenant (or such Lender, as the case may be) under this
Agreement, such Lender shall be released from any further liability hereunder.
(j) There shall be no merger of the Lease or the Lease Rights, or of the
leasehold estate or interest created thereby, with the fee estate in the Property by reason of the fact
that the Lease, the Lease Rights or said leasehold estate may be held, directly or indirectly, by or
for the account of any Person who owns such fee estate or any interest therein, and no such merger
shall occur unless and until all persons then having an interest in such fee estate and all persons
(including any Lender) then having an interest in or under the Lease or the Lease Rights, shall join
in a written instrument effecting such merger and duly record the same.
(k) Without limitation as to Tenant's rights under Section 7.3(b), if there is an
existing deed of trust, mortgage or similar security instrument or Encumbrance creating a lien
against the Property (each a "Mortgage"), Owner agrees to promptly obtain from the holder of
each such Mortgage (each, a "Mortgagee"), an executed subordination and non -disturbance
agreement (an "SNDA") assuring Tenant, any holder of a sub -easement and/or a sublease, and
their respective Lenders that notwithstanding any default by Owner, or any foreclosure or deed in
lieu thereof, Tenant's (and its successors', assigns', sublessees', and subeasement holders') rights
under this Agreement shall continue in full force and effect and their use and possession of the
Property shall remain undisturbed in accordance with the provisions of this Agreement. Such
SNDA will be in a form reasonably acceptable to Tenant, any holder of a subeasement and/or a
sublease, and their respective Lenders, and, at Tenant's sole option, shall be in the form of a direct
SNDA with a holder of a subeasement and/or sublease.
ARTICLE 9 ASSIGNMENT AND SUBLETTING
Section 9.1 Right to Assign or Sublet. Tenant may assign or sublet or apportion or grant
subeasements in or to all or any of Tenant's right, title and interest under this Agreement, in the
Lease and/or in the Lease Rights so long as written notice of such assignment is provided to Owner
after such assignment is effective. Upon any assignment of all of Tenant's right, title and interest
under this Agreement, in the Lease and in the Lease Rights, the assigning Tenant shall
automatically (without the need for any writing) be released from all of its obligations and liability
under this Agreement, except for liabilities that accrued prior to the date of such transfer.
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Section 9.2 Right To Encumber. Tenant may, at any time and from time to time,
conditionally or unconditionally, without obtaining the consent of Owner, hypothecate, mortgage,
grant or pledge all or any portion of Tenant's right, title or interest under this Agreement, in the
Lease, in the Lease Rights and/or in any portion of the Project to any Lender as security for the
repayment of any indebtedness and/or the performance of any obligation relating in whole or in
part to the Project or Operations (a "Lender's Lien").
ARTICLE 10 GENERAL PROVISIONS
Section 10.1 Insurance. Tenant shall obtain and keep in effect a broad form commercial
general liability insurance policy (or its contemporary equivalent), including bodily injury and
property damage coverage, with a limit of no less than Five Million Dollars ($5,000,000), during
the Production Term, and no less than Two Million Dollars ($2,000,000), during the Development
Term and the Construction Term, of combined single limit liability coverage per occurrence,
accident or incident, with a commercially reasonable deductible. The Tenant shall cause the
Owner to be named as an additional insured in such policy, and such policy shall be issued on a
primary and non-contributory basis and Tenant shall deliver to the Owner a certificate of insurance
evidencing said policy, which certificate shall provide that (i) the Owner shall be given notice of
any cancellation or termination of such insurance in accordance with policy terms but not less than
thirty (30) days and (ii) the insurer waives all rights of subrogation against Owner in connection
with any loss or damage covered by such policy. Tenant may satisfy its insurance obligations
under this Section 10.1 through individual insurance policy or policies, blanket insurance policies
or through a program of self-insurance. Owner will carry commercial general liability insurance
coverage covering Owner's indemnity obligations hereunder as well as occurrences, accidents and
incidents resulting from Owner's actions on the Property that (1) occur from and after the Effective
Date (regardless of when the claim is filed) and (2) result of bodily injury, personal injury or death
to any Person and/or damage or destruction of property. Said insurance shall have a combined
single limit of liability per occurrence of not less than one million dollars ($1,000,000) on a single
limit / primary basis and not less than two million dollars ($2,000,000) on an aggregate basis, or
such greater amounts as are typical for comparable projects. Tenant and Lender (if any) shall be
named as additional insureds under Owner's Commercial General Liability policy. Upon written
request by Tenant, Owner shall deliver to Tenant a certificate of insurance evidencing said policy,
which certificate shall provide that (i) the Tenant and Lender (if any) shall be given notice of any
modification, cancellation or termination of such insurance in accordance with policy terms, and
(ii) the insurer waives all rights of subrogation against Tenant in connection with any loss or
damage covered by such policy.
Section 10.2 Environmental Matters.
(a) Owner represents and warrants that, to the best of Owner's knowledge:
(i) the Property is in compliance with Environmental Laws (defined below); and (ii) there are no
Hazardous Materials (defined below) in, on, or under the Property, other than herbicides, pesticides
and fertilizers that have been stored, mixed and applied on the Property in compliance with normal
agricultural practices and in compliance with Environmental Laws. The Tenant acknowledges that
Owner has not performed due diligence, testing, examinations, studies, or related activities with
respect to the Property subject to this Agreement.
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(b) Tenant assumes responsibility for and agrees to comply with (i) all
Environmental Laws applicable to Tenant's use of the Property and (ii) all remediation and other
requirements of Environmental Laws related to Hazardous Materials, to the extent located on or
released on, from or onto, the Property by Tenant or its contractors. Owner assumes responsibility
for and agrees to comply with (i) all Environmental Laws applicable to (A) Owner's use of the
Property, or (B) any conditions existing prior to Tenant's first use of the Property pursuant to this
Agreement, and (ii) all remediation and other requirements of Environmental Laws related to (as
well as all consequences of the existence of) Hazardous Materials located on or released on, from
or onto, the Property prior to Tenant's first use of the Property or as a result of the acts or omissions
of Owner or its employees, agents, invitees, contractors or tenants (other than Tenant).
(c) "Environmental Laws" means any and all federal, state, local, and foreign
environmental, health and/or safety -related laws, ordinances, codes, rules, regulations (as
interpreted by judicial and administrative decisions) relating to protection of the environment,
health and safety, and natural resources. Environmental Laws includes the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended ("CERCLA"),
the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. Sec. 6901 et seq., the rules
and regulations of and enforced by the Iowa Department of Natural Resources ("Environmental
Code"), and the common law.
(d) "Hazardous Materials" means (i) any and all substances, materials,
chemicals, and wastes regulated by Environmental Laws; (ii) "hazardous substance," "pollutant or
contaminant," "petroleum," and "natural gas liquids" as such terms are defined or used in
Section 9601 of CERCLA or by the Environmental Code; or (iii) hazardous wastes, as defined by
RCRA.
(e) No liability shall arise in Tenant from the mere discovery of facts or
conditions existing or pertaining to the Property.
Section 10.3 Use of Water.
(a) Owner hereby grants to Tenant a non-exclusive right to use water from any
and all existing wells on the Property (the "Wells"), together with associated rights to access the
Wells, in connection with the Project. The Wells may not be used by Tenant for other purposes
or the water sold to third parties. Tenant shall have no obligation to maintain, repair, or replace
the Wells; provided, however, that if Tenant's, or its contractors', employees', agents, invitees',
representatives', or tenants' use of the Wells directly damages or destroys a Well, Tenant shall
reimburse Owner for the reasonable and actual costs for the repair of the Well. Tenant agrees that
its use and enjoyment of the Wells shall be undertaken in a manner that does not materially
interfere with Owner's use and enjoyment of the Wells.
(b) To the extent permitted by applicable Laws, Owner grants to Tenant, at
Tenant's sole cost and expense, the right to install, construct, drill, maintain, repair, replace,
relocate, remove and reconstruct a water well, water line, and related facilities on the Property in
connection with the Project (the "Well Facilities").
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(c) To the extent permitted by applicable Laws, Owner leases to Tenant the
right to use the surface water pertaining or appurtenant to the Property in connection with the
Project.
(d) Tenant shall pay Owner, or a governmental entity as directed by applicable
Laws, the fair market value per acre foot of water delivered to and used by Tenant calculated based
on the location of the Property and subject to applicable Laws.
Section 10.4 Indemnity. Owner and Tenant, on behalf of itself and its principals,
members, officers, employees, agents, representatives, contractors, successors and assigns (the
"Indemnifying Party"), shall indemnify, defend and hold harmless the other party and its
principals, members, officers, employees, agents, representatives, contractors, successors and
assigns (collectively, the "Indemnified Party") from and against any Expenses, including arising
from (i) physical damage to property (including the personal property of the Indemnified Party) or
physical injury to or death of any person, in each case to the extent caused by the negligence or
misconduct of the Indemnifying Party, (ii) any violation by the Indemnifying Party of any Law, or
(iii) any material default by the Indemnifying Party, or any failure to be true of any representation
or warranty made by the Indemnifying Party, under this Agreement. The reference to property
damage in the preceding sentence does not include losses of rent, business opportunities, profits
and other consequential damages that may result from Owner's loss of use of any portion of the
Property occupied by the Project pursuant to the Lease or the Lease Rights; provided, however,
that an Indemnifying Party shall have no obligation to indemnify or defend any Indemnified Party
with respect to any Expenses that result or arise from an Indemnified Party's acts or omissions,
negligence or willful misconduct. The parties acknowledge that if Owner is a quasi -governmental
entity that may have limited legal authority and financial capacity to indemnify Tenant; then in the
event the Indemnifying Party under this Section is Owner, Owner shall indemnify Tenant to the
extent of its legal and financial capacity.
Section 10.5 Safety Measures; Waiver and Recognition.
(a) Owner authorizes Tenant to take reasonable safety measures to reduce the
risk of damage to the Project or the risk that the Project will cause damage, injury or death to
people, livestock, other animals or property, and Tenant may construct fencing around the Project
and take other security precautions if Tenant determines, in its sole discretion, that such fencing
and/or security measures will reduce such risks of damage, death or injury or will protect Tenant's
property. The cost of any fencing constructed by Tenant, or of any other such security measures
taken by Tenant, shall be borne solely by Tenant. Owners shall comply with all safety,
environmental, security, or other procedures reasonably set forth by Tenant as required for
compliance with all applicable rules, regulations, laws, orders, and standards, including those set
forth by the Federal Energy Regulatory Commission, the North American Electric Reliability
Corporation (including the Critical Infrastructure Protection standards), any other applicable
regulatory authority, and any other applicable standard setting -entity generally recognized in the
energy industry.
(b) Owner is aware of the potential risks associated with electromagnetic and
stray voltage resulting from the production and transmission of electricity, and knowingly waives
31
all claims resulting from these causes, and owner shall have no right to indemnity pursuant to
Section 10.4 for any such claims. Owner additionally recognizes the need to exercise extreme
caution when in proximity to any portion of the project and the importance of respecting gates,
fences, signage, rules and other safety measures utilized by tenant, and owner agrees to exercise
such caution and respect such measures at all times and to cause its principals, members, officers,
employees, agents, representatives and contractors to do the same, with failure to do so constituting
a material default and subjecting owner to an obligation of indemnity for the consequences thereof
as set forth in Section 10.4.
Section 10.6 Casualty and Condemnation.
(a) If all or part of the Property is proposed to be taken as a result of any action
or proceeding in eminent domain, or is proposed to be transferred in lieu of condemnation to any
authority entitled to exercise the power of eminent domain (collectively, a "Taking"), Owner shall
provide Tenant with immediate written notice of any impending proceeding or meeting related to
such Taking and shall not in the absence of Tenant settle with the Taking authority or agree on
compensation for such Taking.
(b) After payment of all reasonable fees and expenses incurred by Owner and/or
Tenant in collecting the award, any award or other compensation ("Award") payable as a
consequence of such Taking shall be paid to Owner and Tenant in accordance with their interests
in the Property, as follows:
(i) Tenant shall first be entitled to receive out of the Award (A) the
value of the leasehold estates pursuant to the Lease and the Lease Rights in the portions of
the Property subject to the Taking that would have existed but for the Taking; and (B) the
value of the Project; and (C) any other compensation or benefits payable by law to Tenant
as a consequence of the interruption of Tenant's business and the other costs and expenses
incurred by Tenant as consequence of the Taking; and thereafter,
(ii) Owner shall be entitled to receive out of the Award (A) the value of
its fee interest in the Property; and (B) any remainder of the Award.
(c) This Agreement shall terminate as to any portion of the Property so
condemned or taken (except in the case of a temporary Taking after the duration of which Tenant
desires to continue this Agreement, and the Term shall be extended, in such event, by the duration
of such temporary Taking).
(d) Following any casualty event affecting the Property, or any other facilities
installed thereon by Tenant, including, without limitation, any earthquake or wildfire, Tenant shall
have the right to terminate this Agreement in the event any of the following events occurs:
(i) Net insurance proceeds (after deducting the cost of recovery of such
proceeds) are not available to pay one hundred percent (100%) of the cost of such repair,
excluding any deductible that Tenant may be required to pay pursuant to other provisions
of this Agreement;
32
(ii) The Property or any facilities installed thereon by Tenant cannot,
with reasonable diligence, be fully repaired by Tenant within one hundred twenty
(120) days after the date of the damage or destruction; or
(iii) The Property or any facilities installed thereon by Tenant cannot be
safely repaired because of the presence of hazardous factors, including, but not limited to,
earthquake faults, radiation, chemical waste and other similar dangers.
(e) If Tenant elects to terminate this Agreement, pursuant to Section 10.6(d),
Tenant may give Owner written notice of its election to terminate within thirty (30) days after such
damage or destruction, and this Agreement shall terminate fifteen (15) days after the date Owner
receives such notice. To the extend received by Tenant and applicable to such casualty event,
proceeds from insurance maintained by Tenant under Section 10.1 of this Agreement shall be used
by Tenant to complete the Restoration Obligations. If Tenant elects not to terminate this
Agreement, Tenant shall, following the date of such damage or destruction, commence the process
of obtaining necessary permits and approvals, and shall commence repair of its facilities on the
Property as soon as practicable and thereafter prosecute the same diligently to completion, in which
event this Agreement shall continue in full force and effect. All insurance proceeds from insurance
maintained by Tenant under Section 10.1 shall be disbursed and paid to Tenant. Tenant shall not
be entitled to any compensation or damages from Owner for loss of the use of the Property, damage
to Tenant's facilities or personal property or any inconvenience occasioned by such damage, repair
or restoration
Section 10.7 Notices. Any notices, statements, requests, demands, consents,
correspondence or other communications required or permitted to be given hereunder shall be in
writing and shall be given personally, by certified or registered mail, postage prepaid, with delivery
confirmation, return receipt requested, or by overnight or other courier or delivery service, freight
prepaid, to the address of the party to be notified indicated in the Basic Terms and Conditions (and
if to a Lender, the address indicated in any notice to Owner provided under Section 8.4(a)). If to
Tenant, a copy shall also be sent (which shall not constitute notice) to any and all Lenders, to
Tenant's counsel at the address below, and any other party designated by Tenant in writing.
With a copy to: Carl H. Bivens, Esq.
Troutman Pepper Locke
1001 Haxall Point
Richmond, Virginia 23219
Notices delivered by hand shall be deemed delivered when actually received, and notices sent by
certified or registered mail with delivery confirmation or by overnight or other courier or delivery
service shall be deemed delivered upon actual receipt, and shall be deemed to have been given on
the day of actual delivery to the intended recipient (as evidenced by written acceptance of delivery
by the recipient) or on the day delivery is refused. Owner and Tenant and any Lender may change
its address for receipt of notices by sending notice hereunder of such change to the other party (in
the case of a Lender, both parties) in the manner specified in this Section. Notwithstanding the
foregoing, any amounts payable to Owner under this Agreement shall be deemed tendered three
(3) days after a check for the same, addressed to Owner's address above, is deposited in the United
33
States mail, first-class postage prepaid.
Section 10.8 Force Majeure. Notwithstanding any other provision of this Agreement, the
obligations of Owner and Tenant under this Agreement (other than monetary obligations, none of
which shall be excused or delayed by reason of this Section) shall be suspended and excused, and
the term, and any other time periods set forth herein shall continue and be extended for a like
period of time, while such party is hindered or prevented, in whole or in part, from complying with
any term, covenant, condition or provision of this Agreement, by any Event of Force Majeure.
Section 10.9 Meetings with Third Persons. During the Term, Tenant and its
representatives, agents and contractors shall have the right to (i) meet with governmental agencies
and with any other Persons with whom Owner has contractual arrangements in connection with or
relating to the Property or any portion thereof, and (ii) discuss with any such Persons the terms of
this Agreement, the terms of any contractual arrangements between Owner and any such Person,
and any other matters relating to the Property or Tenant's intended use of the Property.
Section 10.10 Termination.
(a) Tenant shall have the right to terminate this Agreement as to all or any
portion of the Property at any time and without cause, and shall execute and cause to be
acknowledged and recorded in the Real Property Records a release describing the portion of rights,
title or interest released, which release shall be deemed delivered to and accepted by Owner upon
such recordation. Tenant shall provide Owner notice of any such termination. The portion of the
Property remaining after any partial termination of this Agreement shall thereafter be the
"Property" for purposes of this Agreement and all payment amounts based on acreage shall be
adjusted accordingly. Upon termination of the Lease in its entirety prior to the Construction
Commencement Date, Tenant shall not have any obligations with respect to the Restoration Term
or the Restoration Obligations.
(b) No act or failure to act on the part of Tenant (including, without limitation,
non-use of any portion of the Property for any particular period of time) shall be deemed to
constitute an abandonment or surrender of the Lease, the Lease Rights or any portion thereof other
than Tenant's releases given pursuant this Section 10.10.
(c) Following the expiration or earlier termination of this Agreement and
Tenant's completion of its obligations with respect to the Restoration Term, Tenant shall execute
and cause to be acknowledged and recorded in the Real Property Records a release of all of
Tenant's right, title and interest in the Property.
(d) Notwithstanding any other Section or provision of this Agreement to the
contrary, Owner shall have the right to terminate this Agreement at any time, with or without
cause, during the Restoration Term. The limitation of remedies available to Owner hereunder shall
otherwise apply in the event Owner terminates this Agreement during the Restoration Term. In the
event Owner terminates this Agreement during the Restoration Term, then all of Tenant's
obligations under the Restoration Term, including, without limitation, satisfaction of the
34
Restoration Obligations, shall become null and void and Tenant shall not have any further
obligations with respect to the Restoration Term or Restoration Obligations.
Section 10.11 Third Party Beneficiaries. Except with respect to the rights of Lenders
(which Lenders are hereby expressly made third party beneficiaries hereof to the extent of their
respective rights hereunder), the agreements and covenants contained herein are made solely for
the benefit of Owner and Tenant, and shall not be construed as benefiting any Person who is not a
party to this Agreement.
Section 10.12 Attorneys' Fees. In the event of any litigation related to the interpretation
or enforcement hereof, or which in any other manner relates to the Lease, the Lease Rights, this
Agreement or the Property, the prevailing party shall be entitled to recover from the other party all
of its attorneys' fees and court and other costs awarded by a court of competent jurisdiction.
Section 10.13 Covenants Running With the Land. The Property shall be held, conveyed,
assigned, hypothecated, encumbered, leased, used and occupied subject to the provisions of this
Agreement, which provisions shall run with the Property, and shall be binding upon and inure to
the benefit of the parties and each other Person having any interest therein during their ownership
thereof, and their respective tenants, heirs, executors, administrators, successors and assigns.
Section 10.14 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state in which the Property is situated.
Section 10.15 Memorandum. Concurrently with execution hereof, the parties shall
execute a Memorandum of Lease Agreement in the form attached to this Agreement as Exhibit C
and cause it to be acknowledged and recorded in the Real Property Records at Tenant's cost.
Section 10.16 Joint and Several Liability. If Owner consists of more than one Person,
each reference herein to "Owner" shall include each Person signing this Agreement as or on behalf
of Owner and the liability of each Person signing this Agreement as Owner shall be joint and
several.
Section 10.17 Binding on Partial Interests. If this Agreement is not executed by one or
more of the persons or entities comprising the Owner herein, or by one or more persons or entities
holding an interest in the Property, then this Agreement shall nonetheless be effective, and shall
bind all those persons and entities who have signed this Agreement.
Section 10.18 Savings Clause. If any term or provision hereof is held to be invalid, void
or otherwise unenforceable by any court of competent jurisdiction, then the same shall not affect
the validity or enforceability of any other term or provision hereof, the terms and provisions hereof
being severable.
Section 10.19 No Waiver. The waiver of any covenant, condition or agreement contained
herein shall not constitute a waiver of any other covenant, condition or agreement herein or of the
future performance thereof.
35
Section 10.20 Entire Agreement; Modifications; Conflicts. This Agreement, including
any Exhibits attached hereto, contains the entire agreement between the parties in connection with
any matter mentioned or contemplated herein, and all prior or contemporaneous proposals,
agreements, understandings and representations, whether oral or written, are merged herein and
superseded hereby. No modification, waiver, amendment, discharge or change of this Agreement
shall be valid unless the same is in writing and signed by the party against whom the enforcement
thereof is sought. The submission of this document for examination and negotiation does not
constitute an offer to lease, or a reservation of, or option for, the Property, and this document shall
become effective and binding only upon the execution and delivery hereof by both Owner and
Tenant. In the event of a conflict between the provisions contained in the Basic Terms and
Conditions and the provisions of the body of this Agreement, the provisions of the Basic Terms
and Conditions shall control.
Section 10.21 Multiple Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original and all of which when taken together shall constitute
one and the same document.
Section 10.22 Provision of Copy of Lease. After execution by all parties to the
Agreement, if Owner so requests in writing, Tenant shall provide, within thirty (30) days of receipt
of such written request, Owner one (1) complete copy of this Agreement.
Section 10.23 Cooperation on Owner's Interest. It is the intent of the parties hereto that
all of Owner's undivided ownership interest in the Property be leased to Tenant hereunder. Owner
agrees that in the event Owner's undivided ownership interest in the Property is more or less than
that specified in the Basic Terms and Conditions, Owner shall, at no additional cost to Tenant,
execute any and all amendments to this Agreement, the Memorandum of Lease Agreement (such
amendment in recordable format) and such other documents as reasonably required to reflect
Owner's proper undivided ownership interest. Owner agrees to reasonably cooperate with Tenant
in completing any such amendments and in facilitating associated corrections with any title
company working with Tenant.
Section 10.24 Limited Accessway. Tenant shall have the right to require Owner to
relocate the North Gate (as defined below) and/or the Beacon (as defined below) upon thirty (30)
days prior written notice, at Tenant's sole cost and expense, to a location outside of the Property.
Upon such relocation, Owner and Tenant shall enter into an amendment to this Agreement to
update this Section 10.24 and Exhibit A-1 to accurately reflect Owner's access rights under this
Section 10.24. Upon at least forty-eight (48) hours prior written notice to Tenant (except in the
case of emergency where Owner shall use commercially reasonable efforts to provide prior written
notice to Tenant), Owner shall have the right to access certain portions of the Property depicted as
"Beacon" (the "Beacon") and "FAA Facility" (the "FAA Facilities") on Exhibit A-1 attached
hereto and by reference made a part hereof; provided, such access to the Beacon and FAA Facilities
shall be limited to entering the Property through the gates depicted as "North Gate" (the "North
Gate") and "South Gate" (the "South Gate") on Exhibit A-1, and such access shall be limited to
use of the area shown as "Optional Access route (Approx. 4.49 acres" on Exhibit A-1 (the
"Limited Accessway"). Owner shall adhere to all security measures and protocols of Tenant, and
Tenant shall have the right to have a representative present during such access over the Limited
36
Accessway to the Beacon and/or FAA Facilities. Further, Owner's indemnity obligations under
Section 10.4 shall include Owner's access rights and use of the Limited Accessway under this
Section 10.24. Tenant shall not construct or install Solar Panels within those portions of the
Property where the Beacon, FAA Facilities, or Limited Accessway are located, but Tenant shall
have all other rights granted by this Agreement with respect to such portions of the Property,
including, without limitation, installation of other Solarpower Facilities (such as transmission
lines) over the Limited Accessway.
Section 10.25 Restricted Area. Notwithstanding any provision of this Agreement to the
contrary, Tenant shall not construct or install Solar Panels on that portion of the Property identified
on Exhibit A-2 attached hereto as the "Solar Panel Restricted Area (Approx. 1,121 Acres)" (the
"Restricted Area"), but Tenant shall have all other rights granted by this Agreement with respect
to such portion of the Property, including, without limitation, installation of other Solarpower
Facilities (such as transmission lines).
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
37
Execution Version
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered by their duly authorized representatives as of the Effective Date.
OWNER:
City of Waterloo
By:
Printed Name: David Boesen
Title: Mayor
[Signature Page]
TENANT:
GRAND HUSK SOLAR, LLC
a Delaware limited liability company
By:
Printed Name:
Title:
[Signature Page]
Execution Version
Attachments:
Exhibit A — Description of Property
Exhibit A-1 — Limited Accessway
Exhibit A-2 — Restricted Area
Exhibit B — Permitted Encumbrances
Exhibit C — Memorandum of Lease Agreement
Exhibit D — Form of Estoppel Certificate
Execution Version
EXHIBIT A
Description of Property
501.45 acres of land, more or less, in Black Hawk County, Iowa, identified as follows:
A Portion of Parcel Number: 891305101016
Acreage: 283
Legal Description:
Ni.-21 Sec. 32-90-13; Se(.. 32-50-13
NE-1 VEI Se 32-90-13:
NW NE Sec. 32-20-13.
SE--- NE-1-- Sec. 32-90-1'6'
Std-2' NE' Sec. 32-90-1'6
4
NE-t 8_71 Sec. 32-90-13
NW SE-t Sec. Z.42-96-1`,',
N13-i .1-1- Sec. 3 90-13; SE- Si See
Sec. 33-90-13; S4 3W Seri:. 33.90-13,
St4 SE-, Sec. 33 -'..)U-13
1.1 Qf t'r4 Nort,Imel:t frocticlifa_c_uart/er.
I). _Qr. ;;ryAt , .tug_ tY:-.GeYVA .440_
.i1W1.4r.C4t.ht3 (3'1..1-9) kt;:co,vf ......
)..or the. :tort.'r.c t. rp.tctinnal, Qu4rtr_r fria. *) . of .
Uo..:Your Tornrigp
RI4gP.No,_TILIxt..v.pn.(13) ..Qf the 51.1. r.
AND
Exhibit A
Parcel Number: 901330326003
Acreage: 26.74
Parcel Number: 901331201001
Acreage: 38.48
Legal Description of Parcel Numbers 901330326003 and 901331201001:
The Northeast Quarter of the Southwest Quarter of Section Nc.
Thirty (30): and the Northwest Quarter of the NOrtheas' Quarter
of Section No. Thirty-one (31). all in Township No. Ninety (90)
North, Range No. Thirteen (13) west of the Fifth Principal
Meridian, in Black hawk f,n::.ty, low, except legal hi,*4a...s.
AND
Parcel Number: 901330476001
Acreage: 38.00
Legal Description:
The Southeast Quarter of the Southeast Quarter of Section No.
Thirty (30), Township No. Ninety (90) North, Range No. Thirteen
(13) nest of the Fifth Principal t•leridian, Black Hawk County,
Ioa.a.
AND
Parcel Number: 901331226001
Acreage: 38.00
Legal Description:
The Northeast Quarter of the NorthEest rui.oter of Section No.
Thirty-one (31), Township No. Ninet (90) North, Range Ne.
Thirteen (13) West of the Fifth Principal Meridian, Black Hawk
County, Iowa.
AND
Parcel Number: 901331276001
Acreage: 39
Parcel Number: 901331251002
Acreage: 38.23
Legal Description of Parcel Numbers 901331276001 and 901331251002:
The South One-half of the Northeast Quarter of Section '1o. Thirty-one (31),
Township No. Ninety (90) North, Range No. Thirteen (13) West of the Fifth
(Sth) Principal Meridian, Black Hawk County, Iowa.
Waterloo
Rogonal Airport
EXHIBIT A-1
Limited Accessway
Parcel ID: 891305101016
Approx. Acreage: 1,355.76
3.200 Feet
Sou Ces. Esra TorTurn. Gurnm FAO. NOAA. uSCaS i() Open5ueetrtaH
COntnhutamand the GrS User Cdntay. trtv
p Airport Bo.mlary 111 Month Gate
Optimal Acte_ss. route (AWrex- 4..a wrest SOud+ Gate
0 Beacon .k FAA Fzeillty
Execution Version
EXHIBIT A-2
Restricted Area
arse
rea
Parcel IDs: 891305101016, 901330326003, 901331201001,
901330476001, 901331226001, 901331276001, & 901331251002
Approx. Acreage: 1,556 acres
T c Rd
Big Woods
Campground
Area
North Industrial
Park
edar Woods
Disc Goff
Course
US Highway 218
0 3950 7.900 Feet
I i I
Gene
-'� Dunkarton Rd
Midporr@
�L
a
I-1 Property Boundary
VA
Solar Panel restricted Area (Approx. 1,188.7 acres)
EXHIBIT B
Permitted Encumbrances
(None, unless listed below)
EXHIBIT C
Memorandum of Lease Agreement
[full document begins on following page]
Exhibit C-1
This document was prepared by and
after recording return to:
Attn: Lease & Title Department
Grand Husk Solar, LLC
320 N. Sangamon Street, Suite 1025
Chicago, Illinois 60607
Telephone Number:
Parcel Identification Numbers: 891305101016, 901330326003, 901331201001, 901330476001, 901331226001,
901331276001, and 901331251002
MEMORANDUM OF LEASE AGREEMENT
THE STATE OF IOWA §
KNOW ALL PERSONS BY THESE PRESENTS:
COUNTY OF BLACK HAWK
THIS MEMORANDUM OF LEASE AGREEMENT (this "Memorandum"), is made,
dated and effective as of (the "Effective Date"), by CITY OF
WATERLOO of 715 Mulberry St. Waterloo, IA 50703 ("Owner"), and GRAND HUSK
SOLAR, LLC, a Delaware limited liability company, with offices at 320 N. Sangamon Street,
Suite 1025, Chicago, Illinois 60607 ("Tenant"), with regards to the following:
1. Solar Agreement. Owner and Tenant did enter into that certain Lease Agreement
of even date herewith (the "Agreement"), which affects the real property located in the County of
Black Hawk, State of Iowa, as more particularly described in Exhibit A attached hereto (the
"Property"). Capitalized terms used and not defined herein have the meaning given the same in
the Agreement.
2. Grant of Rights. The Agreement grants Tenant: (a) the exclusive right to study,
develop and use the Property for converting solar energy into electrical energy and collecting and
transmitting the electrical energy so converted; (b) the exclusive right to access, relocate and
maintain the "Project," as that term is defined in the Agreement, on the Property; (c) an exclusive
right to capture, use and convert the unobstructed solar resources over and across the Property; (d)
a non-exclusive right for any audio, visual, view, light, shadow, noise, vibration, air turbulence,
wake, electromagnetic or other effect of any kind attributable to the development of the Property
for solar energy purposes and operation of the Project; (e) the right to subjacent and lateral support
for the Project; (f) the right of ingress to and egress from the Project on, under, over and across the
Property by means of (A) roads and lanes thereon if existing or (B) such routes, roads and lanes as
Tenant may construct from time to time as provided in the Agreement; (g) the exclusive right to
erect, construct, reconstruct, replace, relocate, remove, operate, maintain and use, on, under, over
and across the Property, in connection with Project overhead and underground electric
transmission and communication system lines and facilities; and (h) the right to undertake any
Exhibit C-2
other activities, as permitted in the Agreement, necessary to accomplish the purposes of the
Agreement.
3. Term; Extensions. The Agreement shall be for an initial Development Term of
up to seven (7) years from the Effective Date. If exercised pursuant to the terms and conditions of
the Agreement, the term of the Agreement may be extended for a Construction Term of up to three
(3) years following the Development Term. If exercised pursuant to the terms and conditions of
the Agreement, the term of the Agreement may be extended for a Production Term of twenty (20)
years following the Construction Term. The Agreement also provides for a right to extend the
Production Term for up to four (4) separate Extension Terms of five (5) years each, totaling twenty
(20) additional years, as determined by Tenant, and if the extension terms and conditions of the
Agreement are met, such renewals to be exercised by Tenant at least 180 days prior to the then -
current expiration date of the Production Term or Extension Term, as the case may be. The
Restoration Term shall begin on the expiration or earlier termination of (a) the Construction Term,
if it occurs and if construction has commenced, or (b) the Production Term, if Tenant does exercise
an option to extend the term of the Lease through the Production Term, and shall expire when
Tenant completes the Restoration Obligations. All rights granted pursuant to the Agreement are
for a term coterminous with the Agreement.
4. Rights of Mortgagees. Pursuant to the Agreement, any Lender of Tenant or
Tenant's assignees has certain rights regarding notice and right to cure any default of Tenant under
the Agreement, as well as other rights as set forth in the Agreement.
5. Assignment. Tenant's rights and obligations under the Agreement are assignable
without Owner's prior written consent so long as written notice of such assignment is provided to
Owner after such assignment is effective. Upon any assignment of all of Tenant's right, title and
interest under the Agreement, the assigning Tenant shall automatically (without the need for any
writing) be released from all of its obligations and liability under the Agreement, except for
liabilities that accrued prior to the date of such transfer.
6. Non -Interference and Setbacks. To the extent permitted by law Owner has waived
any and all setbacks and setback requirements, whether imposed by applicable law or by any
person or entity, including any setback requirements described in the zoning ordinance of the
County of Black Hawk, or in any governmental entitlement or permit heretofore or hereafter issued
to Tenant, such sublessee or such Affiliate. Owner has agreed not to engage in any activity that
might interfere with Tenant's efforts to develop, construct or operate the Project or cause a
decrease in the output or efficiency of the Project without the prior written consent of Tenant.
7. Subordination. The Agreement provides that from and after its effective date, any
right, title or interest created by Owner in favor of or granted to any third party shall be subject to
(i) the Agreement and all of Tenant's rights, title and interests created thereby, (ii) any lien of any
lender of Tenant's then in existence on the leasehold estate created by the Agreement, and (iii)
Tenant's right to create a lien in favor of any lender of Tenant's.
8. Agreement Controls. This Memorandum does not supersede, modify, amend or
otherwise change the terms, conditions or covenants of the Agreement, and Owner and Tenant
Exhibit C-3
executed and are recording this Memorandum solely for the purpose of providing constructive
notice of the Agreement and Tenant's rights thereunder. The terms, conditions and covenants of
the Agreement are incorporated in this Memorandum by reference as though fully set forth herein.
9. No Ownership. Owner shall have no ownership, lien, security or other interest in
any of the Project installed on the Property, or except for as otherwise provided in the Agreement,
any profits derived therefrom, and Tenant may remove any or all Project at any time.
10. Cooperation. Owner shall fully support and cooperate with Tenant in the conduct
of construction and Operations, including in Tenant's efforts to obtain from any governmental
authority or any other Person any environmental impact review, permit, entitlement, approval,
authorization or other rights necessary or convenient in connection with construction and
Operations. Without limiting the generality of the foregoing, in connection with any application
by Tenant for a governmental permit, approval, authorization, entitlement or other consent, Owner
agrees (and shall use reasonable efforts to cause any such other Person to agree) not to oppose, in
any way, whether directly or indirectly, any such application or approval at any administrative,
judicial or legislative level. Further, in the event of legal proceedings related to Tenant's use of the
Property after the Effective Date, except those arising out of the interpretation and/or enforcement
of the Agreement, Owner shall, in all respects, fully cooperate with Tenant in any such proceeding.
Owner agrees that Tenant may provide this Memorandum of Lease Agreement in lieu of any
affidavit of Owner or other form of Owner's consent (whether oral or written) that may be
requested or required in connection with Tenant's efforts to obtain any environmental impact
review, permit, entitlement, approval, authorization, agreement or other rights necessary or
convenient in Tenant's discretion for the Project.
11. Counterparts. This Memorandum may be executed in counterparts, each of which
shall be deemed an original and all of which when taken together shall constitute one and the same
document.
[signatures appear on following page]
Exhibit C-4
IN WITNESS WHEREOF, the parties have executed this Memorandum to be effective as
of the date first written above.
OWNER:
CITY OF WATERLOO
By:
Printed Name: David Boesen
Title: Mayor
STATE OF TOWN,
COUNTY OF
This instrument was acknowledged before me by David Boesen, Mayor, and known to me to be
the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he
executed the same for the purposes and consideration therein expressed.
Given under my hand and seal thiso9V day o ' 1 / ,. , 20
AP"( 'It
IOWA
BRITNI C PERKINS
COMMISSION NO.845529
MY COMMISSION EXPIRES
JANUARY 27, 2026
My$rnmission Expires:
P ' .lic in and for the State of
(Notary Seal)
Exhibit C — Signature Page
TENANT:
GRAND HUSK SOLAR, LLC,
a Delaware limited liability company
By:
Printed Name:
Title:
STATE OF ILLINOIS
COUNTY OF COOK
This instrument was acknowledged before me by
of Grand Husk Solar, LLC, a Delaware limited liability company, on behalf
of said company, and known to me to be the person whose name is subscribed to the foregoing
instrument, and acknowledged to me that he executed the same for the purposes and consideration
therein expressed.
Given under my hand and seal this day of , 20 .
My Commission Expires:
Notary Public in and for the State of Illinois
(Notary Seal)
Exhibit C — Signature Page
Execution Version
EXHIBIT "A" to
MEMORANDUM OF LEASE AGREEMENT
Description of Property
501.45 acres of land, more or less, in Black Hawk County, Iowa, identified as follows:
A Portion of Parcel Number: 891305101016
Acreage: 283
Legal Description:
NT 1,;4* Sec. 32-i:0-.133
NE24 NEI Sec. 32-90-13:
NV* NE4 Sec. 32-90-13.
SE* NE-41- Sec. 32-90-13'
NE i Sec 32-90-13
.
NE4; S7,7, Sec. 52-90-1,3
NW SE- Sec. 32-90-13
I 4. :0
3 -90-13i sr S:iSec:. 33-90-13
Sec. 33-90.-13; S4,+.. SWI Sec,. 33-00-13.
AND
SE:',43, Sec. 53-z--)0-13
jtklf. (F ;:or ti,Afe;:.t rroctictva ;-„-I*Ar, ter
.tix..2k47.1 TAT t,.7:-.01,"ftr, .4230
(37.3.$) kt,r.9f Nqrth..7.racticzi-W.
tjr !fort:rage trrctiqnu.NIrtrr of,
tbn Your (4), cUin Torar,h19 ND, Eir.hty-rnine_ (89)..Nort.b,
ji0,_ Thirtreii (3)t .Qt7 the 5t11 P. 1..
Exhibit A to Exhibit C
Parcel Number: 901330326003
Acreage: 26.74
Parcel Number: 901331201001
Acreage: 38.48
Legal Description of Parcel Numbers 901330326003 and 901331201001:
The Northeast Quarter of the Southwest Quarter of Section Nc.
Thirty (30); and the Northwest Quarter of the thortF,e+s' Quarter
of Section No. Thirty-one (31), all in Township No. Ninety (90)
North, Range No. Thirteen (13) Wei of the Fifth Pr ncipal
Meridian, in Black Hawk Crr..;ty, Iowa. except legal hir•',.ra•.c.
AND
Parcel Number: 901330476001
Acreage: 38.00
Legal Description:
The Southeast Quarter of the Southeast Quarter of Section No.
Thirty (30), Township No. Ninety (95) North, Range No. Thirteen
(13) ''rest of the 'rifth Principal Meridian, (flack Hawk County,
Io%.a.
AND
Parcel Number: 901331226001
Acreage: 38.00
Legal Description:
The Northeast Quarter of the t:orthE ist Gu "ter of Section No.
Thirty-one (31), Township No. Ninet (90) North, Ranee No.
Thirteen `13) West of the Fifth Principe► Meridian, Black Hawk
County, Iowa.
AND
Parcel Number: 901331276001
Acreage: 39
Parcel Number: 901331251002
Acreage: 38.23
Legal Description of Parcel Numbers 901331276001 and 901331251002:
The South One-half of the Northeast Quarter of Section No. Thirty-one (31),
Township No. Ninety (90) North, Range No. Thirteen (13) West of the Fifth
(5th) Principal 'deridian, Black Hawk County, Iowa.
(f
Owner:
Tenant:
Collateral Agent:
1)
F
Execution Version
EXHIBIT D
Form of Estoppel Certificate
ESTOPPEL CERTIFICATE
1, a Delaware limited liability company
1., as collateral agent (the "Collateral Agent")
for the Secured Parties (as defined in the Financing Agreement (as defined
below)) ("Secured Parties")
Collateral Agent's Address:
Tax Equity Investor:
f 1
1
f 1
f 1
Attention: [
Email: I
1, as Class A Investor (as defined in the ECCA (as defined
below)) ("Tax Equity Investor")
Tax Equity Investor's Address:
f 1
Attn: [ 1
f 1
f 1
f 1
Attention: [ 1
Email: [ 1
with a copy to (which shall not constitute notice):
r 1
f 1
f 1
Attention: [ 1
Email: J 1
Exhibit D-1
Title Company: [ ], a [ ] corporation (the "Title Company", together
with the Collateral Agent and the Tax Equity Investor, the "Relying
Parties")
Title Company Address:
Attention: [ ]
Lease:
Property: Description attached hereto as Exhibit B.
Owner hereby certifies the following to (a) the Collateral Agent, for the benefit of the
Secured Parties, and its successors, assigns and/or designees, (b) Tax Equity Investor, (c) Tenant
and (d) the Title Company and its successors, assigns and/or designees, in each case, as of the
Effective Date (as defined below) concerning the above -referenced Lease and the Property, with
the understanding that (i) the Collateral Agent and the Secured Parties will be relying on such
statements with respect to loans, letters of credit and other financial accommodations to be made
to Tenant and/or affiliates of the Tenant under that certain Financing Agreement, dated as of
[ ], 20 (as amended, amended and restated, supplemented or otherwise modified
from time to time, the "Financing Agreement"), by and among [ ], a
Delaware limited liability company, [ ], a [ ] (collectively, the
"Borrowers"), the Collateral Agent, and the other agents, arrangers and financial institutions or
other Persons from time to time party thereto, (ii) the Tax Equity Investor will be relying on such
statements with respect to tax equity investments and other financial accommodations to be made
to Tenant and/or affiliates of the Tenant under that certain Equity Capital Contribution Agreement,
dated as of [ ], 20 (as amended, amended and restated, supplemented or otherwise
modified from time to time, the "ECCA"), by and between [ ], a [ ]limited
liability company, and the Tax Equity Investor, (iii) the Tenant will be relying on such statements
with respect to the loans, letters of credit and other financial accommodations to be made in
connection with the Financing Agreement and the tax equity investments and other financial
accommodations to be made in connection with the ECCA and (iv) the Title Company will be
relying on such statements with respect to the issuance of title insurance policies to the Collateral
Agent and Tenant:
1. A true, correct and complete copy of the Lease (and all amendments and
supplements thereto) is attached to this Estoppel Certificate as Exhibit A and incorporated herein
for all purposes. There are no other documents or agreements (written or oral) that are a part of
the Lease and no other documents or agreements (written or oral) between Owner and Tenant with
respect to the Property or the Project. The parties agree that the copy of the Lease attached hereto
as Exhibit A shall be removed prior to recordation of this Estoppel Certificate; provided, however,
that the absence of such Exhibit A for recordation purposes shall not affect the effectiveness of
Exhibit D-2
this Estoppel Certificate and the representations, acknowledgements and agreements described
herein.
2. The Lease is in full force and effect and has not been modified, restated, cancelled,
supplemented, surrendered, or terminated (except as identified herein). The Lease represents the
entire agreement between Owner and Tenant with respect to the Property subject to the Lease.
The term of the Lease commenced on and will expire on
unless extended as provided in the Lease. Tenant has the right to extend the term of the Lease for
[ ( )] extension term of [ ( ) years and ( ) months]. Owner has not received
notice of any prior assignment or sublease of any right, title or interest of Tenant in, to or under
the Lease.
3. To Owner's knowledge, Tenant has fulfilled all of its obligations under the Lease
now due and owing, and there are no uncured Events of Default of Tenant with respect to the
Lease. There are no uncured Events of Default of Owner with respect to the Lease. There currently
exists no dispute (or any threatened dispute) between Owner and Tenant with respect to the Lease
and there are no delinquent payments under the Lease. Owner has no present right to terminate
the Lease. Tenant has neither given nor received any notice of default, Event of Default or
termination of the Lease. Owner has neither given nor received any notice of default Event of
Default or termination of the Lease. There are no facts or circumstances which with the giving of
notice or lapse of an applicable cure period, or both, would constitute a breach or default under the
Lease.
4. Owner is the current holder of the fee title of the surface estate and the mineral
estate to the Property described in the Lease. Owner: (a) holds the entire interest of owner under
the Lease; (b) has not conveyed, mortgaged, assigned or otherwise transferred the Property or
Owner's interest in the Lease to any third party; and (c) has not agreed to convey, mortgage, assign
or otherwise transfer the Property or Owner's interest in the Lease to any third party. Owner
acknowledges that pursuant to the Lease, Owner shall not exercise or lease or permit any other
person or entity to exercise any water or mineral rights on the surface of the Property, or above a
depth of 500 feet on the Property or if such exercise by Owner interferes with Tenant's use of the
Property for the purpose of installation, construction, operation, maintenance, repair,
improvement, or replacement of the Project and uses incidental thereto. All representations made
by Owner and Tenant in the Lease are true and correct in all material respects as of the date hereof.
5. Except for the lien for this year's property taxes that are not now due and payable,
there are no judgments, liens, deeds of trust or mortgages encumbering the Property and there are
no unpaid bills, outstanding claims or persons entitled to claims for mechanics or materialmens'
liens against the Property for work performed on the Property by or for Owner (as opposed to work
performed on the Property by or for Tenant).
Party.
6. Owner acknowledges receiving notice of the name and address of each Relying
7. Tenant has informed Owner that Tenant has granted a first -priority lien and security
interest in Tenant's leasehold estate in the Property under the Lease and the Project to the Collateral
Exhibit D-3
Agent to secure the repayment of the ,loans and other financial accommodations made under the
Financing Agreement. Owner agrees that (i) the Collateral Agent, the Secured Parties, the Tax
Equity Investor and any affiliates, successors and assigns, shall be deemed to be and shall be
entitled to all of the rights, benefits and protections of, a "Lender" pursuant to Section [ 1 of the
Lease and the other provisions thereof, and (ii) the Collateral Agent, the Secured Parties, the Tax
Equity Investor and any affiliates, successors and assigns and transferees, shall be deemed to be
and shall be entitled to all of the rights, benefits and protections of, an "Assignee" pursuant to
Section [ 1 of the Lease and the other provisions thereof. Notwithstanding the foregoing, the
rights of the Collateral Agent and the Tax Equity Investor or any affiliates, successors and assigns
with respect to an assignment or transfer of the Lease shall be subject to Paragraph 8 below.
8. In addition to the provisions specified in Section F 1 of the Lease, the following
shall apply to the Collateral Agent, the Tax Equity Investor, their affiliates, successors and assigns
(for so long as the Collateral Agent, the Tax Equity Investor, their affiliates, successors and assigns
remain a "Lender" under the Lease) and to each other person that provides written notice to Owner
that it is a "Lender" under the Lease (and for so long as each such person remains a "Lender"
under the Lease):
8.1 Owner agrees to provide notice of any request by Tenant for any
amendment, modification, or supplement to the Lease to the Collateral Agent and the Tax Equity
Investor at the address provided to Owner by the Collateral Agent and the Tax Equity Investor.
Owner agrees that, for so long as a Collateral Agent or Tax Equity Investor is a "Lender" under
the Lease, Owner shall provide such notices to the Collateral Agent and the Tax Equity Investor
at the address already provided to Owner (or at such other address as the Collateral Agent or the
Tax Equity Investor may from time to time provide).
8.2 The Collateral Agent shall have the absolute right, without Owner's
consent, to take any of the following actions or do any of the following: (i) assign, amend, modify
and/or restate its Deed of Trust (as defined below); (ii) enforce its Deed of Trust; (iii) acquire title
to Tenant's leasehold estate under the Lease (whether by foreclosure under its Deed of Trust or
assignment in lieu of foreclosure); (iv) take possession of the Project or the Property pursuant to
its rights under its Deed of Trust and operate the Project subject to compliance with the Lease; (v)
following acquisition of title (or a third parry's acquisition of title) to Tenant's leasehold estate
under the Lease as a result of the Collateral Agent's foreclosure or assignment in lieu of
foreclosure, (a) assign or transfer Tenant's leasehold estate under the Lease to a successor third
party, (b) engage an operator experienced in the operation of photovoltaic solar projects or (c)
comply with the assignment provisions of the Lease; (vi) exercise any rights of Tenant with respect
to the Lease or (vii) cause a receiver to be appointed to do any of the foregoing things. Tenant has
entered into (a) the Deed of Trust (as defined in the Financing Agreement) ("Deed of Trust"), in
favor of the Title Company, as trustee for the benefit of the Collateral Agent.
8.3 The Collateral Agent shall have no obligation under the Lease prior to the
time that the Collateral Agent succeeds to absolute title to the leasehold estate of Tenant under the
Lease; and the Collateral Agent shall be liable to perform obligations under the Lease only for and
during the period of time that the Collateral Agent directly holds such absolute title. Further, in
the event that the Collateral Agent elects, prior to the time that such Collateral Agent succeeds to
Exhibit D-4
absolute title to the leasehold estate of Tenant under the Lease, to (i) perform Tenant's obligations
under the Lease, (ii) continue Tenant's operations on the Property, (iii) acquire any portion of
Tenant's right, title or interest in the Property or under the Lease or (iv) enter into a new agreement
as provided in Paragraph 8.4 below, then the Collateral Agent shall not have any personal liability
to Owner in connection therewith, and Owner's sole recourse in the event of default by the
Collateral Agent shall be to exercise those remedies of Owner permitted pursuant to the Lease.
Moreover, the Collateral Agent or other party who acquires the leasehold estate created by the
Lease pursuant to foreclosure or an assignment in lieu of foreclosure shall not be liable to perform
any obligations thereunder to the extent the same are incurred or accrue after the Collateral Agent
or other party no longer has ownership of such leasehold estate.
8.4 In the event that the Lease is rejected or disaffirmed pursuant to bankruptcy
law or any other law affecting creditor's rights, then, so long as the Collateral Agent has cured any
monetary event of default by Tenant and is making commercially reasonable efforts to cure any
non -monetary event of default by Tenant (other than the bankruptcy of Tenant) as provided therein,
Owner shall, immediately upon written request from the Collateral Agent received within ninety
(90) days after any such termination, rejection or disaffirmance, without demanding additional
consideration therefor, enter into a new agreement in favor of the Collateral Agent, which new
agreement shall (i) contain the same covenants, agreements, terms, provisions and limitations as
the Lease (except for any requirements that have been fulfilled by Tenant prior to such termination,
rejection or disaffirmance), (ii) be for a term commencing on the date of such termination, rejection
or disaffirmance, and continuing for the remaining term of the Lease before giving effect to such
termination, rejection or disaffirmance and (iii) enjoy the same priority as the Lease over any lien,
encumbrance or other interest created by Owner. On execution of such new agreement by the
Collateral Agent, and until such time as such new agreement is fully executed and delivered by all
parties, the Collateral Agent may enter, use and enjoy the Property and conduct operations thereon
as if the Lease were still in effect. At the option of the Collateral Agent, the new agreement may
be executed by a designee of the Collateral Agent, without the Collateral Agent assuming the
burdens and obligations of Tenant thereunder. If more than one "Lender" makes a written request
for a new agreement pursuant hereto, then the same shall be delivered to the Collateral Agent
whose Deed of Trust is senior in priority.
9. Owner acknowledges its obligation to give notice of any act of default of Tenant
under the Lease to the Collateral Agent and the Tax Equity Investor at its address stated above (or
such other addresses specified by the Collateral Agent or the Tax Equity Investor in writing to
Owner).
10. Other than Tenant, there are no tenants or other third parties using or otherwise
occupying the Property, including, but not limited to, any third party mineral and water rights
holders.
11. There are no actions or proceedings, whether voluntary or involuntary, pending
against Owner in any State or Federal court (including any bankruptcy court, governmental
authority, or arbitration board or tribunal which could reasonably be expected to have a material
adverse effect on the ability of Owner to perform its obligations under the Lease), or any judgments
affecting Owner's title to the Property, and, to the knowledge of Owner, none have been
Exhibit D-5
threatened. As used herein, the term "pending" means actions or proceedings which have been
filed and actually served on Owner.
12. Owner has not received notice of any condemnation of or any other governmental
or judicial action against, or threat of condemnation of or any other governmental or judicial action
against, the Property, or a portion of the Property, that remains in effect or unresolved.
13. Owner is not aware of any event, act, circumstance, or condition constituting an Event
of Force Majeure or otherwise excusing the performance of any party under the Lease. No known
facts exist entitling Owner to any claim, counterclaim, offset, or defense against the Tenant in
respect of the Lease.
14. This Estoppel Certificate shall be binding upon Owner and its successors and
assigns.
15. This Estoppel Certificate may be executed with counterpart signature pages and in
duplicate originals, each of which shall be deemed an original, and all of which together shall
constitute a single instrument.
16. This Estoppel Certificate is made and delivered as of - (the "Effective
Date"). This Estoppel Certificate may be relied upon by the Tenant, the Collateral Agent, the other
Secured Parties (as defined in the Financing Agreement), the Tax Equity Investor and the Title
Company, the successors and assigns of each of them and any future leasehold mortgagee of
Tenant.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
Exhibit D-6
IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, have
duly executed this Estoppel Certificate as of the day and year first above written.
OWNER:
By:
Name:
Title:
[Estoppel Signature Page]
Execution Version
EXHIBIT "A"
To Estoppel Certificate
[Lease Agreement and any amendments to be attached but not to be recorded]
Exhibit A to Estoppel Certificate
Execution Version
EXHIBIT `B"
To Estoppel Certificate
Description of Property
[LEGAL DESCRIPTION AND SURVEY DRAWING TO BE ATTACHED]
Exhibit B to Estoppel Certificate
Execution Version
LEASE AGREEMENT
between
Grand Husk Solar, LLC
as Tenant
and
Waterloo Airport Commission
as Owner
dated lt-{ 202�
Execution Version
TABLE OF CONTENTS
Page(s)
ARTICLE 1 DEFINITIONS AND CONSTRUCTION 2
Section 1.1 Defined Terms 3
Section 1.2 Construction 7
ARTICLE 2 GRANT OF RIGHTS; TERM 8
Section 2.1
Section 2.2
ARTICLE 3 RENT
Section 3.1
Section 3.2
Section 3.3
Section 3.4
Section 3.5
Section 3.6
Section 3.7
ARTICLE 4 LEASE RIGHTS
Section 4.1
Section 4.2
Section 4.3
Section 4.4
Lease and Grant of Lease Rights 8
Term of Lease 8
9
Development Term Rent 9
Construction Term Rent 10
Production Term Rent 10
Restoration Term Rent 10
Payment Adjustments 10
Crop Compensation, Pivot and Drip Irrigation, and CRP 10
Payment Allocations 1 1
11
Additional Lease Rights 11
Stand -Alone Lease Rights 12
Nature of Lease Rights, Additional Lease Rights and Stand -
Alone Lease Rights 12
Separate Storage Leases 12
ARTICLE 5 PERMITTED USE; RIGHTS OF PARTIES; DEVELOPMENT
PROGRESS 13
Section 5.1 Permitted Use 13
Section 5.2 No Required Construction or Production 13
ARTICLE 6 TENANT'S OBLIGATIONS 13
Section 6.1 Compliance with Law 13
Section 6.2 Location of Project and Care and Appearance 13
Section 6.3 Fences and Gates 14
Section 6.4 Operations 14
Section 6.5 Payment of Claims 16
Section 6.6 Restoration 16
Section 6.7 Taxes 16
ARTICLE 7 OWNER'S OBLIGATIONS 17
Section 7.1 No Interference 17
Section 7.2 Compliance with Obligations 18
Section 7.3 Rights of Third Parties 19
Section 7.4 No Ownership Rights 19
Section 7.5 Cooperation 19
Section 7.6 Setback Waiver 20
Section 7.7 Confidentiality 21
Section 7.8 Division of Lease 22
Section 7.9 Estoppel Certificates 22
Section 7.10 Representations and Warranties of Owner 22
ARTICLE 8 DEFAULT; REMEDIES; PROTECTION OF LENDERS 23
Section 8.1 Default 23
Section 8.2 Owner's Right to Terminate for Monetary Default 24
Section 8.3 Limitation on Remedies Error! Bookmark not defined.
Section 8.4 Protection of Lenders 25
ARTICLE 9 ASSIGNMENT AND SUBLETTING 28
Section 9.1 Right to Assign or Sublet 28
Section 9.2 Right To Encumber 28
ARTICLE 10 GENERAL PROVISIONS 29
Section 10.1 Insurance 29
Section 10.2 Environmental Matters 29
Section 10.3 Use of Water 30
Section 10.4 Indemnity 31
Section 10.5 Safety Measures; Waiver and Recognition 31
Section 10.6 Casualty and Condemnation 32
Section 10.7 Notices 33
Section 10.8 Force Majeure 33
Section 10.9 Meetings with Third Persons 34
Section 10.10 Termination by Tenant 34
ii
Section 10.11 Third Party Beneficiaries 35
Section 10.12 Attorneys' Fees 35
Section 10.13 Covenants Running With the Land 35
Section 10.14 Governing Law 35
Section 10.15 Memorandum 35
Section 10.16 Joint and Several Liability 35
Section 10.17 Binding on Partial Interests 35
Section 10.18 Savings Clause 35
Section 10.19 No Waiver 35
Section 10.20 Entire Agreement; Modifications; Conflicts 35
Section 10.21 Multiple Counterparts 36
Section 10.22 Provision of Copy of Lease 36
Section 10.23 Cooperation on Owner's Interest 36
Section 10.24 Restricted Area 36
iii
Execution Version
LEASE AGREEMENT
THIS LEASE AGREEMENT ("Agreement") is made, dated and effective as of
(the "Effective Date"), and between the Owner ("Owner") and
Tenant ("Tenant"), designated in the Basic Terms and Conditions below:
Basic Terms and Conditions
Effective Date of this Agreement:
Owner:
Waterloo Airport Commission
Owner's Address:
715 Mulberry St., Waterloo, IA 50703
Tenant:
Grand Husk Solar, LLC, a Delaware limited liability
company
Tenant's Address:
320 N. Sangamon Street, Suite 1025, Chicago, Illinois
60607
Property:
257.99 acres in the County of Black Hawk, Iowa as
specifically described in Exhibit A.
Length of Lease Term:
.
The "Development Term" shall be a period of five
(5) years from the Effective Date, with two (2) one (1)-
year extension options (i.e., totaling up to seven (7) years
if all options and extensions are exercised), all as set forth
in Section 2.2(a). The "Construction Term" shall
commence on the Construction Commencement Date and
be for a period of up to three (3) years, all as set forth in
Section 2.2(b). The Tenant may exercise an option to
extend the term of the Lease through the Production Term
by achieving the Generation Commencement Date.
Should the Generation Commencement Date occur any
time prior to the expiration of the Construction Term, the
"Production Term" will automatically commence and
continue, unless terminated earlier as provided herein, to
a date which is twenty (20) years from the Generation
Commencement Date, subject to four (4) extension terms
of five (5) years each (i.e., totaling up to forty (40) years
of Production Term if all options and extensions are
exercised), all as provided in Section 2.2(c). The
"Restoration Term" shall begin on the expiration or earlier
termination of (a) the Construction Term, if it occurs and
if construction has commenced, or (b) the Production
Term, if Tenant does exercise an option to extend the term
of the Lease through the Production Term, and shall
expire when Tenant completes the Restoration
Obligations.
Development Term Rent:
One-time payment of $50.00 per acre subject to this
Agreement (excluding the Restricted Area) to be paid by
Tenant to Owner (the "Signing Fee"), as well as and to
the extent applicable $50.00 per acre subject to this
Agreement (excluding the Restricted Area) to be paid by
Tenant to Owner at the end of each twelve (12) month
period during the Development Term (the "Periodic
Development Term Rent"), and if the Development
Term is extended, a one-time payment for each extension
of $30.00 per acre subject to this Agreement (excluding
the Restricted Area) (the "Additional Development
Term Rent" and together with the Signing Fee and
Periodic Development Term Rent, the "Development
Term Rent"). Development Term Rent is payable as
required in Section 3.1.
Construction Term Rent:
If the Construction Commencement Date has occurred,
then an annual payment of $350.00 per acre times the
number of acres of the Property which Tenant's plans
show will be enclosed by a fence to be constructed for the
Project shall be paid by Tenant to Owner (the
"Construction Term Rent"). Construction Term Rent is
payable as required in Section 3.2.
Production Term Rent:
During the Production Term (if it occurs), Tenant will pay
Owner for the first Lease Year an amount equal to
$1,400.00 (the "Production Term Rent Multiplier")
multiplied by the total number of acres of the Property
which are enclosed by a fence constructed for the Project
or which Tenant's plan show will be enclosed by a fence
to be constructed for the Project. The Production Term
Rent Multiplier shall increase by two percent (2%) per
Lease Year during the Production Term. All of the
foregoing shall be referred to as the "Production Term
Rent".
Restoration Term Rent:
Tenant will not owe any amounts to Owner as rent during
the Restoration Term.
ARTICLE 1 DEFINITIONS AND CONSTRUCTION
2
Section 1.1 Defined Terms. When used in this Agreement, the following capitalized
terms shall have the definitions indicated:
"Additional Lease Rights": Shall have the meaning set forth in Section 4.1.
"Affiliate": any Person (i) who, directly or indirectly (including through one or more
intermediaries), holds an equity interest in Tenant (a "Parent Company") or (ii) in which Tenant
or a Parent Company, directly or indirectly (including through one or more intermediaries) holds
an equity interest.
"Agreement": This Lease Agreement (including the Lease and Lease Rights).
"Award": Shall have the meaning set forth in Section 10.6(b).
"CERCLA": Shall have the meaning set forth in Section 10.2(c).
"Confidential Information": Shall have the meaning set forth in Section 7.7.
"Construction Commencement Date": The earlier of: (a) the date Tenant provides
written notice to Owner of the Construction Commencement Date; or (b) the date when Tenant
commences the installation of vertical improvements for Solarpower Facilities for the Project on
the Property and is diligently pursuing construction of the Project on the Property. For the
avoidance of doubt, pre -construction studies, surveys, and development -related diligence shall not
be considered construction commencement.
"Construction Term": The period beginning on the Construction Commencement Date
and terminating upon expiration or earlier termination as provided herein.
"Construction Term Rent": Shall have the meaning set forth in the Basic Terms and
Conditions.
"County": The county in which the Property is situated.
"Development Term": The period during which Tenant performs development activities,
including but not limited to measuring the solar resource, obtaining permits, securing Tenant's
position to interconnect into the grid, as more particularly defined in the Basic Terms and
Conditions and Section 2.2(a).
"Development Term Rent": Shall consist of the Signing Fee and, if applicable, the
Periodic Development Term Rent and the Additional Development Term Rent, and have the
meaning set forth in the Basic Terms and Conditions.
"Effective Date": Shall have the meaning given in the first sentence of this Agreement.
"Encumbrances": Any liens, encumbrances, covenants, conditions, reservations,
restrictions, easements, leases, licenses, occupancies, tenancies, mineral rights, water rights or
other matters affecting, relating to or encumbering the Property or any portion thereof.
3
"Environmental Laws": Shall have the meaning set forth in Section 10.2(c).
"Event of Default": Shall have the meaning set forth in Section 8.1.
"Event of Force Majeure": Strikes, lockouts or other labor disturbances; delays in
transportation; inability to secure labor or materials in the open market; acts of God or the
elements, including fire, flood, washout, perils at sea, lightning, earthquake or accidents;
conditions arising out of or attributable to acts of war, civil disturbances or riots; the effect of any
Law; the failure of any governmental authority to issue any permit, entitlement, approval or
authorization within a reasonable period of time after an application for the same has been
submitted; the inability to sell electricity at commercially reasonable prices in the open market;
orders of curtailment or suspension or cessation of transmission system operations by MISO; or
any other matter or condition beyond the reasonable anticipation and control of the party in
question, whether or not similar to the matters or conditions herein specifically enumerated; and
(in the case of Tenant) while litigation contesting all or any portion of the right, title and interest
of Owner in the Property and/or of Tenant under this Agreement shall be pending and not finally
determined.
"Expenses": Any and all expenses incurred in connection with investigating, defending
or asserting any claim, action, suit or proceeding incident to any matter indemnified against
hereunder (including, without limitation, court filing fees, court costs, arbitration fees or costs,
witness fees, and reasonable fees and disbursements of legal counsel, investigators, expert
witnesses, consultants, accountants and other professionals), and any and all losses, costs,
obligations, liabilities, settlement payments, awards, judgments, fines, penalties, damages,
expenses, deficiencies or other charges with respect thereto, but excluding in any event any Party's
own (i.e., not damages claimed by a third party) lost profits and other special or consequential
damages, which result from the indemnifiable events described herein.
"Extension Date": Shall have the meaning set forth in Section 2.2(c).
"Extension Term": Shall have the meaning set forth in Section 2.2(c'.
"Generation Commencement Date": The earlier of: (a) the date Tenant provides written
notice to Owner of the Generation Commencement Date; or (b) the date on which any Solarpower
Facilities that are being constructed on the Property have passed their initial performance tests and
have begun to commercially deliver electricity into the transmission grid.
"Hazardous Materials": Shall have the meaning set forth in Section 10.2(d).
"Indemnified Party": Shall have the meaning set forth in Section 10.4.
"Indemnifying Party": Shall have the meaning set forth in Section 10.4.
"MISO": MISO, a Regional Transmission Organization.
"Laws": All valid and applicable laws, statutes, ordinances, regulations, orders and
assessments of any federal, state, county or local governmental authority with jurisdiction over the
Project or the Property.
"Lease": The Lease created by this Agreement.
"Lease Rights": The following lease rights in, on, under, over, across, along and above
the Property:
(a) A right of access and of ingress to and egress from the Project, as well as a
right for access to and from adjacent lands in the Project, in each case by means of any existing
roads on the Property, and by such other roads as Tenant may construct on the Property from time
to time at locations reasonably agreed between Tenant and Owner, for the benefit of and for
purposes incidental to Operations on the Property, provided that Owner agrees to approve at least
one road location to the Project;
(b) The right to install, use, repair, improve, relocate, replace and remove
Transmission Facilities to be placed in locations selected by Tenant.
(c) A non-exclusive right for any audio, visual, view, light, shadow, noise,
vibration, air turbulence, wake, electromagnetic or other effect of any kind or nature whatsoever
resulting, directly or indirectly, from any Operations conducted, or Project owned, leased, operated
or maintained by Tenant on the Property and on lands near the Property.
(d) The right to use construction staging and laydown areas in locations
reasonably agreed between Tenant and Owner for installing, using, repairing, improving,
relocating, replacing, and removing the Project.
(e) The exclusive right to study, develop and use the Property for converting
solar energy into electrical energy and collecting and transmitting the electrical energy so
converted.
(f) The exclusive right to access, relocate and maintain the Project located on
the Property.
(g) The exclusive right to capture, use and convert unobstructed solar resources
over and across the Property.
(h) The right to subjacent and lateral support for the Project.
Tenant acknowledges and agrees that the "Lease Rights" are subject to Tenant's
compliance with all applicable Laws, including the securing of any required permits, licenses, or
approvals, and that Owner makes no representation or warranty concerning any applicable Laws
or the ability to secure any permits, licenses, or approvals.
"Lease Year": The period from the Generation Commencement Date through the
December 31 of the calendar year in which the Generation Commencement Date occurs (which
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shall be deemed the first Lease Year), and each subsequent calendar year during the Production
Term.
"Lender": Any financial institution or other Person that from time to time provides
secured financing for some or all of the Project or Operations, and any agent, security agent,
collateral agent, indenture trustee, loan trustee, loan participant or participating or syndicated
lenders involved in whole or in part in such financing, and their respective representatives,
successors and assigns.
"Lender's Lien": Shall have the meaning set forth in Section 9.2.
"Monetary Default": Shall have the meaning set forth in Section 8.1.
"Non -Monetary Default": Shall have the meaning set forth in Section 8.1.
"Notice of Default": Shall have the meaning set forth in Section 8.1.
"Operations": The activities which Tenant has the right to undertake pursuant to Section
5.1.
"Owner": The legal owner of the Property described in the Basic Terms and Conditions
and as further defined in Exhibit A.
"Owner Nonrenewal Notice": Shall have the meaning set forth in Section 2.2(c).
"Person": Any individual, corporation, partnership, joint venture, association, joint stock
company, trust, trustee, estate, limited liability company, unincorporated organization, real estate
investment trust, government or any agency or political subdivision thereof, or any other form of
entity.
"Production Term": The period beginning on the Generation Commencement Date and
terminating upon expiration or earlier termination as provided herein.
"Production Term Rent": Shall have the meaning set forth in the Basic Terms and
Conditions.
"Project": The Solarpower Facilities, Transmission Facilities, electric transformers,
energy storage facilities, telecommunications equipment related to the Solarpower Facilities,
roads, meteorological stations and solar energy measurement equipment (including pyranometers),
maintenance, administrative and storage areas and buildings, reasonable signage and all related
improvements and equipment, portions of which are located on the Property.
"Property": The Property as described in the Basic Terms and Conditions.
"Real Property Records": The official public records of the County or Counties in which
deeds and other instruments affecting title to real property are required to be recorded to place
third parties on constructive notice of them.
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"Rent": The Development Term Rent, Construction Term Rent, Production Term Rent,
and Restoration Term Rent as described in Article 3.
"Restoration Obligations": Tenant's obligation to (i) remove from the Property any part
of the Project owned, installed or constructed by Tenant thereon except for roads, (ii) fill in and
compact all trenches or other borings or excavations made by Tenant on the Property (excepting
borrow pits and quarries), and (iii) leave the surface of the Property free from debris, as more
particularly defined and described in Section 6.6.
"Restoration Term": As more particularly defined in the Basic Terms and Conditions,
Section 2.2(d), and Section 6.6, the period beginning on (a) the expiration or earlier termination of
the Construction Term, if it occurs and if construction has commenced, or (b) if the Production
Term commences, the expiration or earlier termination of the Production Term, and expiring when
Tenant completes the Restoration Obligations.
"Restoration Term Rent": Shall have the meaning set forth in the Basic Terms and
Conditions.
"Solar Panel": A photovoltaic generation unit which converts sunlight into electrical
current which is included in the Solarpower Facilities.
"Solarpower Facilities": Solar -powered electric generating facilities, including Solar
Panels, other photovoltaic generating equipment and such other solar -powered generating
equipment as reasonably determined by Tenant, related infrastructure and the ancillary
improvements and equipment providing support or otherwise associated therewith, all of which is
located on the Property and on any other real property included in the Project.
"Stand -Alone Lease Right": Shall have the meaning set forth in Section 4.2.
"Taking": Shall have the meaning set forth in Section 10.6(a).
"Term": The Development Term, the Construction Term (if it becomes effective) the
Production Term (if it becomes effective and including one or more Extension Terms if exercised),
and the Restoration Term each as described in Section 2.2.
"Town": The town in which the Property is situated.
"Transmission Facilities": Underground and above -ground wires and cables, for the
transmission of electrical energy and/or for communication purposes, and all necessary appliances
and fixtures for use in connection with said wires and cables under, along, above and in or adjacent
to the Property; and one or more substations or interconnection or switching facilities, together
with all related or appropriate rights of way, on, along and in or adjacent to the Property.
Section 1.2 Construction. In this Agreement, unless the context otherwise requires, the
singular shall include the plural, the masculine shall include the feminine and neuter, and vice
versa. The terms "include," "includes" and "including" shall be deemed to be followed by the
words "without limitation." The term "year" refers to a calendar year, the term "month" refers to
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a calendar month, and any period measured by a "year" or a "month" from a reference date refers
to the period beginning on such reference date and ending on the same date of the next succeeding
calendar year or month, respectively, or, if no such date exists in the next succeeding calendar
month, the last day of such next succeeding calendar month. References to a Section or Exhibit
shall be references to a Section of, or Exhibit to, this Agreement unless specifically stated
otherwise. A reference to a given agreement or instrument shall be a reference to that agreement
or instrument as modified, amended, supplemented and restated through the date as of which such
reference is made. The term "or" is not exclusive, the term "shall" is mandatory and the term
"may" is permissive. Owner and Tenant acknowledge that each was actively involved in the
negotiation and drafting of this Agreement and that no law or rule of construction shall be raised
or used in which the provisions of this Agreement shall be construed in favor of or against either
party because one is deemed to be the author thereof. Captions or titles used herein are for
convenience of reference only and do not affect the meaning or intent hereof.
ARTICLE 2 GRANT OF RIGHTS; TERM
Section 2.1 Lease and Grant of Lease Rights. For the good and valuable consideration
provided herein, the receipt and sufficiency of which are hereby acknowledged by Owner and
Tenant, Owner hereby leases to Tenant, and Tenant leases from Owner, the Property, and Owner
grants to Tenant the Lease Rights. Tenant acknowledges and agrees that the "Lease Rights" are
subject to Tenant's compliance with all applicable Laws, including the securing of any required
permits, licenses, or approvals, and that Owner makes no representation or warranty concerning
any applicable Laws or the ability to secure any permits, licenses, or approvals.
Section 2.2 Term of Lease. The term of this Agreement shall consist of the
Development Term plus, if it becomes effective, the Construction Term, plus, if it becomes
effective, the Production Term, plus, if exercised, up to four (4) Extension Terms, plus, if it
becomes effective, the Restoration Term. Prior to the expiration of the Development Term, Tenant
shall have the option to extend the term of this Agreement through the Construction Term, exercise
of such option by Tenant being made and evidenced solely by achievement of the Construction
Commencement Date. Prior to the expiration of the Construction Term, Tenant shall have the
option to extend the term of this Agreement through the Production Term, exercise of such option
by Tenant being made and evidenced solely by achievement of the Generation Commencement
Date. Notwithstanding any other provision of this Agreement (including any Lender protection
provisions), if the Development Term or Construction Term of this Agreement expires in
accordance with the terms of this Agreement, prior to the Generation Commencement Date
occurring, this Agreement shall automatically terminate at the expiration of the Restoration Term,
if applicable
(a) The Development Term shall commence on the Effective Date and continue
for a period of up to five (5) years, provided, however, that Tenant shall have the right to extend
the Development Term two (2) times for an additional one (1) year each by delivering written
notice of such extension to Owner at least thirty (30) days prior to the then -current expiration date
of the Development Term, in the event Tenant extends the Development Term, Tenant shall owe
the Additional Development Term Rent as set forth in Section 3.1. The Development Term shall,
8
in all events, terminate on the Construction Commencement Date and the Construction Term shall
commence.
(b) The Construction Term shall commence on the Construction
Commencement Date and continue for a period of up to three (3) years. The Construction Term
shall, in all events, terminate on the Generation Commencement Date and the Production Term
shall commence.
(c) The Production Term, if it occurs, shall commence on the Generation
Commencement Date and continue to the date that is twenty (20) years from the Generation
Commencement Date, provided, however, that Tenant shall have the right to extend the Production
Term by four (4) separately exercised periods of five (5) years each (each such five year period,
an "Extension Term") if Tenant delivers written notice of such extension to Owner at least one
hundred eighty (180) days prior to the then -current expiration date of the Production Term or the
then -current expiration date of the Extension Term, as applicable (the "Extension Date"). The
parties understand that the Production Term could total up to forty (40) years if all four (4) options
for Extension Terms are exercised and this Agreement is not earlier terminated by Tenant in
accordance with its terms. The parties intend that the Tenant not lose any option to extend an
Extension Term through inadvertence or mistake. Accordingly, and notwithstanding the
foregoing, if Tenant shall fail to exercise its renewal option for an Extension Term within such
time period as set forth above, Tenant's right to exercise its option for an Extension Term shall
nonetheless continue for an additional sixty (60) days following receipt of Owner's notice to
Tenant and to any Lender of the failure of Tenant to timely exercise such option (the "Owner
Nonrenewal Notice"),If either Tenant or Lender provides notice to Owner of its intent to exercise
such option within such sixty (60) day period following receipt of the Owner Nonrenewal Notice,
then such exercise by Tenant or Lender shall be deemed timely given.
(d) The Restoration Term shall commence on the expiration or earlier
termination of (i) the Construction Term, if it occurs and if construction has commenced, or (ii)
the Production Term, if Tenant does exercise an option to extend the term of the Lease through the
Production Term. The Restoration Term shall expire when Tenant completes the Restoration
Obligations.
ARTICLE 3 RENT
Section 3.1 Development Term Rent. During the Development Term, Tenant shall pay
to Owner the Development Term Rent in the amount provided for in the Basic Terms and
Conditions. The Signing Fee is payable within forty-five (45) days from the Effective Date. Each
payment of the Periodic Development Term Rent is payable within forty-five (45) days after the
end of each 12-month period of the Development Term (for example, the first such 12-month
period expiring 12 months after the Effective Date). If Tenant exercises an option to extend the
Development Term for one (1) additional year, then the Additional Development Term Rent is
payable within forty-five (45) days from the date when the additional one (1) year of the
Development Term commences. Tenant shall have no obligation to make any payment to Owner
otherwise required under this Agreement until Tenant has received from Owner a completed
Internal Revenue Service Form W-9.
9
Section 3.2 Construction Term Rent. During the Construction Term, if it occurs, Tenant
shall pay to Owner the Construction Term Rent in the amount provided for in the Basic Terms and
Conditions. The Construction Term Rent is payable within forty-five (45) days from the
Construction Commencement Date and within forty-five (45) days from each annual anniversary
thereof for the remainder of the Construction Term. If the Construction Commencement Date
occurs during any one (1) year period in which Development Term Rent has been paid, including
in a year in which Tenant has extended the Development Term, the Construction Term Rent shall
be reduced by the prorated amount of the Development Term Rent or the Additional Development
Term Rent, as applicable, for the remaining period for which Development Term Rent has been
paid. For illustrative purposes only, if the Construction Commencement Date occurs six (6) months
into the first year the Development Term is extended, the Construction Term Rent shall be reduced
by a prorated amount that is equal to six (6) months of the Additional Development Term Rent.
Section 3.3 Production Term Rent.
(a) During the Production Term, if it occurs, Tenant shall pay to Owner the
Production Term Rent for each Lease Year as provided for in the Basic Terms and Conditions. If
the Generation Commencement Date occurs during any one (1) year period in which Construction
Term Rent has been paid, the Production Term Rent shall be reduced by the prorated amount of
the Construction Term Rent for the remaining period for which Construction Term Rent has been
paid. For illustrative purposes only, if the Generation Commencement Date occurs six (6) months
into the first year of the Construction Term, the Production Term Rent shall be reduced by a
prorated amount that is equal to six (6) months of the Construction Term Rent.
(b) Payment of Rent. The Production Term Rent shall be paid to Owner within
thirty (30) days of the Generation Commencement Date. Subsequent Production Term Rent shall
be paid annually within thirty (30) days of the first day of each Lease Year. Notwithstanding any
of the foregoing, Tenant shall have no further liability to make any payments of Development
Term Rent, Construction Term Rent or Production Term Rent under this Agreement following its
termination or expiration. If the first or last Lease Year is less than an entire calendar year, the
Production Term Rent shall be prorated for the applicable portion of such Lease Year.
Section 3.4 Restoration Term Rent. Tenant shall not owe any amounts to Owner as rent
during the Restoration Term.
Section 3.5 Payment Adjustments. If Owner owns less than the full surface estate in all
or any part of the Property, all payments required hereunder shall be reduced to the proportion that
Owner's interest in the Property bears to the full surface estate in the Property, or any portion
thereof.
Section 3.6 Crop Compensation, Pivot and Drip Irrigation, and CRP. Tenant shall use
its commercially reasonable efforts to avoid damaging Owner's existing cultivated land,
pastureland and pivot or drip irrigation systems ("Irrigation System") if located on the Property.
If Tenant's development of the Project: (a) damages or destroys any of Owner's crops or saw -log
timber on such cultivated land, then Tenant shall reimburse Owner the fair market value for the
year in which the crop damage occurred, as established by Multi -Peril Insurance historic yields for
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the ten (10) previous years, for any damage to or displacement of Owner's cultivated crops on the
Property caused by Tenant, (b) damages or destroys any of Owner's pasture land, then Tenant will
reseed the affected areas with grasses and/or natural vegetation in accordance with the reasonable
and customary standards in the area for restoring and reseeding pastureland, or (c) damages or
causes Owner to relocate the Irrigation System, the Tenant shall reimburse Owner for the fair
market value, for the year in which the crop damage occurred, of the cost to relocate, repair or
replace the Irrigation System, whichever cost is less. If Owner is a party to a Conservation Reserve
Program contract ("CRP Contract") with the U.S. Department of Agriculture pursuant to 7 C.F.R.
Part 1410 regarding the Property, then Owner shall provide Tenant with a true and complete copy
of such CRP Contract, together with all amendments and modifications, and if applicable, Tenant
shall reimburse Owner for (a) any rental payments, or portion thereof, Owner would have received
from the U.S. Department of Agriculture but for locating the Project on the Property, and (b) the
penalties and interest, if any (including for any past payments received by Owner that must be
repaid by Owner), assessed by, the U.S. Department of Agriculture as a result of the location of
the Project on the Property. Owner shall cooperate with Tenant in completing and submitting
documents to obtain any exemptions allowed under the Conservation Reserve Program for the use
of the Project on the portions of the Property covered by a CRP Contract. Section 3.6 shall not
apply to Owner's cultivated land, pastureland, and Irrigation System(s) existing after the
Construction Commencement Date or notice to Owner thereof.
Section 3.7 Payment Allocations.
Tenant shall make all payments due under this Agreement to Owner as provided below:
Waterloo Airport Commission
715 Mulberry St.
Waterloo, IA 50703
% of each payment: 100%
For the avoidance of doubt, Tenant's failure to make payments pursuant to this Section 3.7
shall not constitute an Event of Default, so long as payment is made to Owner at the address
provided in the Basic Terms and Conditions. Owner acknowledges and agrees that payment of all
sums due under this Agreement pursuant to this Section 3.7 shall satisfy all requirements for the
payment of Rent and other sums required to be made by Tenant under this Agreement.
ARTICLE 4 LEASE RIGHTS
Section 4.1 Additional Lease Rights. If Tenant wishes to obtain from Owner one or
more lease rights on, over, across, along and/or above any real property that is owned or controlled
by Owner and adjacent to the Property (each, an "Additional Lease Right"), in connection with,
for the benefit of and for purposes incidental to the Project, including the right to install and
maintain on such other real property (i) transmission lines and facilities, both overhead and
underground, which carry electrical energy to and/or from the Project, (ii) communications lines
and facilities, both overhead and underground, which carry communications to and/or from the
Project, and/or (iii) metering equipment, substations, switching stations, solar energy measurement
11
equipment and control, maintenance and administration buildings that benefit the Project, then
upon request Owner shall grant to Tenant such a lease right in such location or locations as Tenant
may reasonably request, provided that Tenant shall agree to pay to Owner a fee consistent with the
Production Term Rent for the number of acres subject to such Additional Lease Right in addition
to all other amounts payable by Tenant to Owner hereunder.
Section 4.2 Stand -Alone Lease Rights. Owner acknowledges that commercial
operation of the Project may require, from time to time during the Project's existence, additional
lease rights in favor of certain third parties on the Property and on the real property that is owned
by Owner and adjacent to the Property. Accordingly, if the independent system operator with
jurisdiction over the system in which the Project operates, the transmission system owner or
operator to whose transmission lines the Project interconnects, the phone or other communications
provider, or the off -taker to whom output and/or renewable energy credits from the Project is to
be sold, determines that one or more separate, stand-alone lease (each, a "Stand -Alone Lease
Right") on, over, across, along and/or above the Property and any real property that is owned by
Owner and adjacent to the Property, including the right to install and maintain on the Property
(i) transmission lines and facilities, both overhead and underground, which carry electrical energy
to and/or from the Project, (ii) communications lines and facilities, both overhead and
underground, which carry communications to and/or from the Project, and/or (iii) metering
equipment, substations, switching stations, solar energy measurement equipment and control,
maintenance and administration buildings that benefit the Project, is reasonably required for the
efficient and/or safe operation of the Project, then upon request Owner shall grant to such third
party such an lease right in such location or locations as such party may reasonably request,
provided that such party shall agree to pay to Owner a reasonable fee agreed to by Owner in
advance for such lease right in addition to all other amounts payable by Tenant to Owner
hereunder.
Section 4.3 Nature of Lease Rights, Additional Lease Rights and Stand -Alone Lease
Rights. Each Lease Right, Additional Lease Right and Stand -Alone Lease Right (i) shall be in the
nature of and similar to the Lease Rights granted to Tenant under Section 2.1 and shall be in a
form reasonably acceptable to Tenant and Owner, such Affiliate or the grantee of such lease rights
as applicable (which form shall at a minimum include lender protective provisions comparable to
those included herein), (ii) shall be a lease right in favor of Tenant or such other holder of such
lease right, and (iii) shall, upon the granting thereof, be included within the meaning of the term
"Lease Rights", except where otherwise stated or where the context otherwise requires. Each
Lease Right, Additional Lease Right and Stand -Alone Lease Right shall inure to the benefit of and
be binding upon Owner and the holder of such Lease Right, Additional Lease Right or Stand -
Alone Lease Right, as the case may be, and their respective successors and assigns, and all persons
claiming under them.
Section 4.4 Separate Storage Leases.
If Tenant from time to time so requests and provided that no uncured Event of Default then
exists under this Agreement, Owner shall promptly execute and deliver to Tenant or an Affiliate
selected by Tenant one (1) or more separate, independent lease agreements for separate and distinct
battery energy storage projects to be located on the Property, which separate, independent lease
12
agreements shall be on substantially the same terms and in substantially the same form as this
Agreement.
ARTICLE 5 PERMITTED USE; RIGHTS OF PARTIES; DEVELOPMENT
PROGRESS
Section 5.1 Permitted Use. Tenant shall use the Property solely for solar energy
purposes, and Tenant shall also have the exclusive right to use the Property for solar energy
purposes. "Solar energy purposes" means converting solar energy into electrical energy, and
collecting, storing and transmitting the electrical energy so converted, together with any and all
other activities related thereto, including (i) determining the feasibility of solar energy conversion
on the Property, including studies on solar irradiance, light direction and other meteorological data
and extracting soil samples, and all other testing, studies or sampling desired by Tenant;
(ii) constructing, installing, using, replacing, relocating, controlling and removing from time to
time, and maintaining and operating the Project; and (iii) undertaking any other activities, whether
accomplished by Tenant or a third party authorized by Tenant, that Tenant reasonably determines
are necessary, useful or appropriate to accomplish any of the foregoing, including the right to erect,
construct, reconstruct, replace, relocate, remove, control, maintain and use Transmission Facilities
from time to time in connection with the Project.
Section 5.2 No Required Construction or Production. Nothing contained in this
Agreement shall be construed as requiring Tenant (i) to undertake construction or installation or
to alter or remove any part of the Project on the Property or elsewhere except for those
requirements contained in Section 6.6 hereof, (ii) to continue operation of any part of the Project
from time to time located on the Property or elsewhere or (iii) to generate or sell any minimum or
maximized amount of electrical energy from the Property; and the decision if, when and to what
extent that such construction and generation will occur shall be solely in Tenant's discretion.
Owner acknowledges that Tenant has made no representations or warranties to Owner, including
any regarding development of, or the likelihood of power generation from, the Property.
ARTICLE 6 TENANT'S OBLIGATIONS
Section 6.1 Compliance with Law. In conducting its Operations on the Property, Tenant
shall comply in all material respects with all Laws; however, Tenant may contest the validity or
applicability of any Law (including any property tax) to Tenant, the Project, the Operations, or any
other activity or property of Tenant or Tenant's Affiliate, by appropriate legal proceedings brought
in the name of Tenant or in the names of both Tenant and Owner where appropriate or required.
Any such contest or proceeding, including any initiated by Tenant.and maintained in the name of
Owner, shall be controlled and directed by Tenant, but in consultation with Owner and at no cost
to Owner, excepting proceedings which arise due to Owner's violation of any law. Tenant agrees
to promptly reimburse Owner for any costs or fees (including reasonable attorney's fees) incurred
by Owner in connection with this Section.
Section 6.2 Location of Project and Care and Appearance. Tenant shall notify and
reasonably consult with Owner regarding the location of the Project on the Property prior to the
Construction Commencement Date; provided however, (i) such consultation is advisory only,
13
(ii) Tenant shall not be restricted in any way from exercising Tenant's rights hereunder as a result
of such consultation, and (iii) Tenant shall not be required to obtain Owner's approval or consent
to the location of any part of the Project. Tenant shall bury all wires, cables and lines on the
Property that are required to be buried at least twenty-four inches (24") below the surface of the
Property. If such wires, cables, or lines become exposed at the surface or are not buried at least
twenty-four inches (24") below the surface regardless of the cause, Tenant shall take all actions
necessary to cause the wires, cables, and lines to be buried at least twenty-four inches (24") below
the surface of the Property. Where commercially feasible, Tenant agrees to (x) install all overhead
lines along existing transmission or utility easements and (y) bury collection cables and fiber optic
cables either underneath or alongside newly -constructed roads. Tenant shall keep the Property
clean and free of debris created by Tenant, its contractors, or others entering the Property at the
request of Tenant. Tenant shall not use the Property for storage except for materials, construction
equipment and vehicles directly associated with construction or maintenance of the Project on the
Property or adjacent lands that are part of the Project and Tenant shall have the right to designate
for use in this regard during the construction and development process (or at any time thereafter)
such laydown yards or areas as it shall determine to be appropriate given the then current nature
of the Operations. Tenant shall take commercially reasonable steps to maintain the grass on the
Property in compliance with the Owner's wildlife hazard management plan at Tenant's sole cost
and expense.
Section 6.3 Fences and Gates. Tenant shall have the right to remove fences, gates, and
cattle guards, but only as reasonably necessary to accommodate the Project; however, upon
Owner's reasonable request, Tenant shall maintain, repair or replace any fences, gates, or cattle
guards, damaged or removed in connection with Tenant's activities. Any fences, gates, or cattle
guards repaired or replaced by Tenant shall be in conformance with the quality and style of the
fences, gates, and cattle guards existing on, or if none are on then nearby, the Property. Fences
removed from locations within the Property where Tenant has determined removal is necessary to
avoid interference with its Operations, if replaced, shall be rebuilt by Tenant at its expense in other
mutually agreeable locations and sufficient to withstand Tenant's uses for the Operations and of
not less than the same style and quality installed by Owner elsewhere on the Property. Once
completed, all replacement fences, gates and cattle guards shall be owned and maintained by
Owner. If Tenant makes a new entrance through any existing fence, Tenant shall install a cattle
guard sufficient to withstand Tenant's uses for the Operations and of not less than the same style
and quality installed by Owner elsewhere on the Property. Tenant will reseed areas cleared by
Tenant and used for lay -down or storage areas with the same types of grasses or crops found on
adjacent tracts if Owner reasonably requests such reseeding.
Section 6.4 Operatiohs. During the Development Term, Tenant may access the
Property following prior notice to the Owner (which notice may be oral), except in the event of an
emergency, where no prior notice shall be required. During the Construction Term and the
Production Term, Tenant shall have access to the Property twenty-four (24) hours a day, seven (7)
days a week, without prior notice to Owner. Tenant and all Tenant personnel, and all personnel
of third parties authorized to enter the Property by Tenant, shall follow the following rules while
on the Property. Any individual who commits a third violation of these rules after receipt of written
warning from Owner, may be fined in an amount not to exceed $500.00 per violation for each
14
violation of these rules after receipt of written warning from Owner for the first and second
violations.
(a) All access gates shall remain padlocked at all times when not in use; all
access gates, as well as all interior gates, shall remain closed at all times when not in use.
(b) All personnel shall minimize, to the extent reasonably possible, the creation
of dust and the introduction of noxious plants or vegetation to the Property.
(c) At no time shall any of employees of Tenant, or any third parties authorized
to enter the Property by Tenant bring any of the following onto the Property:
(i) Weapons of any type, including but not limited to, guns, bows and
arrows, or sling shots.
(ii) Animal calling devices.
(iii) Fishing equipment or nets.
(iv) Dogs, cats or any other animals.
(v) Alcoholic beverages.
(vi) Illegal drugs or related paraphernalia.
(d) Smoking is prohibited except in designated construction areas and in
vehicles. Tenant will employ prudent precautions to prevent fires, including avoiding the build-
up of plant material under vehicles. In the event a grass fire is started, Owner shall be promptly
notified, as well as emergency personnel if necessary. Tenant agrees to pay to Owner a reasonable
fee per acre for fire damage but not less than $50.00 per acre for fire damage to existing crops
and/or pasture land (whether located on the Property or adjacent lands owned by Owner) that is
caused by Tenant, its employees, contractors, agents or any individual allowed onto the Property
by Tenant. Such payment shall be due and payable within thirty (30) days of such fire. Such
payment shall in no way limit or waive Owner's right to obtain payment for fire damage to animals,
structures, equipment or other things located on the Property, or lands adjacent to the Property.
(e) Tenant shall keep the Property clean and free of all trash and litter which
may emanate from Tenant or its employees, agents, contractors or invitees operations on the
Property, and if Tenant does not do so within ten (10) days after written notice from Owner, Tenant
agrees to pay Owner's reasonable costs of picking up such litter and trash either on the Property
or adjacent lands. Under no circumstances will Tenant bury or burn any trash, debris or foreign
material of any nature on the Property.
(f) Tenant, its employees, contractors, agents and any individual allowed onto
the Property by Tenant shall not bury, dump, spill or discharge any Hazardous Materials (as
defined in Section 10.2), gasoline, oil, hydraulic fluid, fuel, paint or other foreign, toxic, or other
waste substances on the Property.
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(g) No wood, plants, animals (dead or alive), artifact or any other item that was
not originally brought onto the Property by Tenant's personnel will be removed from the Property.
(h) The following speed limits shall be strictly observed while using roads on
the Property: thirty-five (35) miles per hour during daylight; twenty-five (25) miles per hour after
dark.
Section 6.5 Payment of Claims. Tenant shall pay, when due, all claims for labor or
materials furnished to or for Tenant at the Property, which claims are secured by any mechanic's
or materialmen's lien against the Property; however, Tenant may contest such claims by
appropriate legal proceedings brought in the name of Tenant or in the names of both Tenant and
Owner where appropriate or required, so long as Tenant pays and satisfies any adverse judgment
that may be rendered thereon before the enforcement thereof. Any such contest or proceeding,
including any maintained in the name of Owner, shall be controlled and directed by Tenant.
Section 6.6 Restoration. Subject to the rights of Lenders upon termination of this
Agreement as provided herein, and subject to the rights of Lease Right holders as provided in
Article 4, during the Restoration Term, Tenant shall complete the Restoration Obligations;
provided however, the Restoration Obligations shall not include the replanting of trees, removing
of access roads or regrading to existing conditions, and, as to any part of the Project located beneath
the surface of the land, Tenant shall only be required to remove any part of the Project located
beneath the surface of the land (such as, without limitation, footings and foundations) to a depth
of twenty-four (24) inches below the surface of the land. Nothing contained in this Section shall
be construed as precluding Tenant from taking any of the foregoing actions at any time during the
Development Term, the Construction Term, or the Production Term. No less than thirty (30) days
prior to the commencement of the Restoration Term, Tenant shall provide to Owner and maintain
during the remainder of the Term one or more performance bonds, letters of credit, or another form
of financial security in such type and amount determined in the Tenant's discretion, in each case
in form and substance to secure Tenant's completion of the Restoration Obligations. The amount
of any financial security maintained by Tenant pursuant to the prior sentence shall be reduced by
the scrap and salvage value of the Project. In the event any federal, state, county or local
governmental authority with jurisdiction over the Project or the Property requires bonding or other
security securing decommissioning and the Restoration Obligations, then Tenant's satisfaction of
those requirements shall satisfy all bonding or other security requirements under this Section 6.6.
No less than thirty (30) days prior to the commencement of the Restoration Term, Tenant shall
provide to Owner a decommissioning plan for Tenant's satisfaction of the Restoration Obligations.
Section 6.7 Taxes. Tenant shall pay prior to delinquency any property taxes levied and
assessed by any governmental authority upon any part of the Project placed on the Property by
Tenant. Owner shall pay when due any taxes attributable to (a) improvements or facilities installed
by Owner or others (excluding Tenant) on the Property and (b) the underlying value of the
Property; provided, however, that if, following the Construction Commencement Date, the taxes
against the underlying value of the Property are increased by reason of a change of use
determination by a taxing entity (including roll -back taxes assessed up to five (5) years after
termination or expiration of this Agreement, provided Owner uses good faith efforts to obtain
agricultural exemptions, if applicable, during such time) or increased assessment of the Property
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resulting from Tenant's Operations or any part of the Project thereon, then Tenant shall pay the
entire amount of such increase so attributable. Owner and Tenant agree that during the
Development Term hereof, no change in Owner's agricultural activities on the Property is required
by this Agreement. Owner shall submit any real property tax bill regarding the Property and/or the
Project (and any other communication from any government authority regarding the same) to
Tenant within thirty (30) days after Owner's receipt thereof from the taxing authority. If any taxes
payable by Tenant hereunder are levied or assessed in the name of Owner as part of the real
property taxes payable by Owner, then, within thirty (30) days after Owner submits the real
property tax bill to Tenant, Tenant shall reimburse Owner for all such taxes payable by Tenant
hereunder. Tenant's obligations hereunder are subject to Tenant's right to contest pursuant to
Section 6.1 and hereunder. Tenant shall have the right, in its sole discretion, to contest by legal
proceedings (which may be brought in the name(s) of Owner and/or Tenant where appropriate or
required), the validity or amount of any assessments or taxes for which Tenant is responsible
hereunder. Owner shall in all respects cooperate with Tenant in any such contest.
ARTICLE 7 OWNER'S OBLIGATIONS
Section 7.1 No Interference.
(a) Among the Lease Rights granted and conveyed by Owner to Tenant is the
exclusive right to the flow of sunshine and solar irradiation to and across the Property. Owner
covenants that neither Owner nor any other Person (other than Tenant and Persons claiming
through or under Tenant) shall obstruct or interfere with such Lease Right for the free flow of
sunshine and solar irradiation throughout the entire area of the Property ("Irradiation Lease
Right"), which shall consist of horizontally three hundred and sixty degrees (360°) from each point
within the Property where the Project is or may be located at any time or from time to time to the
boundaries of the Property, and vertically through all space above the surface of the Property.
(b) Accordingly, neither Owner's activities nor the exercise of any rights
hereafter given or granted by Owner to any other Person (whether exercised on the Property or
elsewhere), shall materially interfere with Tenant's then -existing lease or other rights relating to
(i) access by Tenant or its Affiliates or contractors to the Property or any lands in the vicinity of
the Property used by Tenant in the Operations associated with the Project, (ii) Operations of Tenant
or its Affiliates or contractors on the Property or on any lands owned by Owner in the vicinity of
the Property, (iii) the exercise of Tenant's rights under this Agreement, or (iv) the undertaking of
any other activities permitted by Tenant hereunder.
(c) Without limiting the generality of the foregoing, for so long as this
Agreement is in effect, Owner covenants that, to ensure the Irradiation Lease Right referenced in
Section 7.1(a), neither Owner nor any other Person that has obtained rights either from Owner or
any party claiming, directly or indirectly, under Owner, shall interfere with solar irradiation or
light direction over the entire Property or any lands owned or controlled by Owner in the vicinity
of the Property on which Tenant or any Affiliate thereof owns, leases, operates or maintains
Solarpower Facilities, and Owner shall not plant trees or construct buildings or other
improvements that will adversely affect the full Irradiation Lease Right, or engage in any other
activity on the Property or elsewhere, that might cause a decrease in the output or efficiency of
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any of the Solarpower Facilities. The parties acknowledge and agree that the grant of the
Irradiation Lease Right and the covenants by Owner contained in this Agreement are a material
inducement for Tenant to enter into this Agreement, and each of the parties acknowledge and
recognize that a violation of the terms hereof will cause irreparable damage to Tenant and Tenant
may have no adequate remedy at law for such violation. Accordingly, each of the parties agrees
that Tenant shall be entitled, as a matter of right, to an injunction from any court of competent
jurisdiction restraining any violation of such covenants and to specifically enforce Tenant's
exclusive right to the Irradiation Lease Right. This right to injunctive relief will be cumulative
and in addition to whatever remedies Tenant may otherwise have at law.
(d) In the event that Owner becomes a party to an oil and gas lease or sub-
surface agreement or mineral interest lease or sub -surface agreement affecting the Property that is
executed after the date hereof, Owner agrees to include surface use provisions in such oil and gas
or mineral interest lease or surface agreement substantially as follows:
Lessee agrees that its lease is subordinate and subject to all leases, lease rights and
easements that are of record as of the date of this Lease. Further, lessee covenants and
agrees that lessee shall take all reasonable actions to accommodate the use of the surface
of the leased property by the surface owner or other persons or entities having rights of
use of the surface of the leased property, regardless of whether such uses or rights of use
arise before or after the date of this lease. Lessee shall not have the right to damage,
relocate, or remove any surface structure or improvement, without the express written
consent of the owner of such structure or improvement, regardless of when such surface
structure or improvement was constructed or installed.
Lessee acknowledges that lessor and third parties ("Energy Tenant," whether one or more)
may execute one or more agreements, contracts, leases, or easements affecting the leased
property authorizing the operation of solar power projects for generating electricity and
related facilities on the leased property. Lessee agrees to fully cooperate with any Energy
Tenant with regard to the use of the leased property. Lessee agrees to fully compensate
any Energy Tenant for any damage caused by lessee to the facilities or property of such
Energy Tenant.
Lessee shall not drill any well or perform any subsurface activity within 300 feet of any
solar power generating unit located on the leased property.
Section 7.2 Compliance with Obligations. Owner shall comply on a timely basis with
all of its legal and contractual obligations with respect to the Property, including the payment
before delinquency of property taxes that are attributable to the underlying value of the Property
or improvements thereon not owned by Tenant. If Owner fails to do so, then, without limitation
upon any other rights or remedies that Tenant may have at law or in equity, Tenant may (but shall
not be obligated to) pay or otherwise satisfy any unpaid property taxes or other obligations of
Owner which, if left unsatisfied, could delay, interfere with, impair or prevent Operations or the
exercise of any of Tenant's other rights under this Agreement, or the financing of the Project; and
Tenant shall thereupon be subrogated to the rights of the obligee of such obligations. Without
limitation on any other rights or remedies available to Tenant, any sums so expended by Tenant
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shall, at Tenant's election, either be (i) immediately reimbursed to Tenant by Owner or (ii) offset
against any Rent or other amounts then or thereafter due and payable to Owner under this
Agreement.
Section 7.3 Rights of Third Parties.
(a) From and after the Effective Date, any right, title or interest created by
Owner in favor of or granted to any third party shall be subject to (i) this Agreement and all of
Tenant's rights, title and interests created hereby, (ii) any Lender's Lien then in existence on the
leasehold estate created by this Agreement, (iii) Tenant's right to create a Lender's Lien and
(iv) any and all documents executed or to be executed by Tenant in connection with this
Agreement.
(b) If at any time during the Term any Encumbrance to Owner's title to the
Property which was created prior to the Effective Date is found, exists or is claimed to exist against
the Property or any portion thereof, creates rights superior to those of Tenant, and Tenant in its
sole discretion determines that the existence, use, operation, implementation or exercise of such
Encumbrance could delay, interfere with, impair or prevent Operations or the exercise of any of
Tenant's other rights under this Agreement or the financing of the Project, Tenant shall be entitled
to seek to obtain a subordination, non -disturbance agreement, consent or other agreement,
including a recognition agreement in favor of any Lender (in a form and containing provisions
reasonably acceptable to Tenant or its Lenders) from the holder of such Encumbrance that will
eliminate such risks for the benefit of Tenant, and Owner shall use its best efforts to assist Tenant
in connection therewith.
Section 7.4 No Ownership Rights. Owner acknowledges and agrees that (i) Tenant is
and shall remain the exclusive owner and operator of the Project, which is Tenant's personal
property and which shall not be deemed a fixture, (ii) Owner has no right or interest in or to the
Project, (iii) Owner may not sell, lease, assign, mortgage, pledge or otherwise transfer, alienate or
encumber the Project with the fee interest or leasehold or other rights in or to the Property or
otherwise; and (iv) notwithstanding anything to the contrary herein, Tenant has the right to remove
the Project and its other personal property from the Property at any time and from time to time,
including upon the expiration or earlier termination of this Agreement, in accordance with Section
6.6. Without limiting the generality of the foregoing, Owner hereby waives any statutory or
common law lien that it might otherwise have in or to the Project or any part thereof. Any and all
solar resource data collected by or on behalf of Tenant after the Effective Date is the sole property
of Tenant. The solar resource data shall be Confidential Information.
Section 7.5 Cooperation.
(a) Owner shall fully support and cooperate (and shall use reasonable efforts to
cause any other Person with any other right, title or interest in the Property to cooperate) with
Tenant in the conduct of its construction and Operations and in otherwise giving effect to the
purpose and intent of this Agreement, including in Tenant's efforts to obtain from any
governmental authority or any other Person any environmental impact review, permit, entitlement,
approval, authorization or other rights necessary or convenient in connection with construction
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and Operations; and Owner shall (and shall use reasonable efforts to cause any such other Person
to) promptly upon request, without demanding additional consideration therefor, execute, and, if
appropriate, cause to be acknowledged and recorded, any map, application, permit or document
that is reasonably requested by Tenant in connection therewith (as well as any amendment to this
Agreement or any recordable memorandum executed in connection herewith for purposes of
correcting or replacing property descriptions based on surveys or other relevant information
obtained after the Effective Date, or making other non -substantive corrections, additions or
substitutions). Without limiting the generality of the foregoing, in connection with any application
by Tenant for a governmental permit, approval, authorization, entitlement or other consent, Owner
agrees (and shall use reasonable efforts to cause any such other Person to agree) not to oppose, in
any way, whether directly or indirectly, any such application or approval at any administrative,
judicial or legislative level. Further, in the event of legal proceedings related to Tenant's use of the
Property after the Effective Date, except those arising out of the interpretation and/or enforcement
of the Agreement, Owner shall, in all respects, fully cooperate with Tenant in any such proceeding.
Owner agrees that Tenant may provide the Memorandum of Lease Agreement in lieu of any
affidavit by Owner or other form of Owner's consent (whether oral or written) that may be
requested or required in connection with Tenant's efforts to obtain any environmental impact
review, permit, entitlement, approval, authorization, agreement or other rights necessary or
convenient in Tenant's discretion for the Project.
(b) Owner shall, promptly after the Effective Date, make available to Tenant
copies of any and all surveys that relate to the Property (to the extent such information relates
directly to the proposed Project) to the extent that the same are in Owner's possession or under its
control. Upon request from Tenant, Owner shall cooperate with Tenant's efforts to obtain
subordination and/or non-interference agreements with the holders of any mineral interests or other
parties having any surface rights to the Property. Owner shall provide Tenant with all information
in Owner's possession reasonably required by Tenant to make contacts with such holders and to
negotiate such agreements, including the names, addresses and phone numbers of contact persons
and the locations of any other holder's or party's equipment, improvements, or facilities located
or proposed to be located on the Property.
(c) Owner shall cooperate with Tenant in its development of the Project by
avoiding the pasturing of animals on or near portions of the Property at which Tenant's
construction, removal, maintenance or other similar activities are occurring.
(d) Owner shall not obstruct passage along, into or from any road or area within
the Property that is accessed in connection with the Operations, except that Owner may fence and
gate such areas and gate roads if it provides the keys or combinations to Tenant for any gate locks.
(e) Prior to the Construction Commencement Date, Owner shall remove any
tangible personal property (e.g. goods, equipment, inventory, vehicles, trailers, farm implements,
farm animals, parts/accessories, barrels/containers, discard/rubbish materials, etc.) from the
Property.
Section 7.6 Setback Waiver. To the extent that (i) Owner now or in the future owns or
leases any land adjacent to the Property, or (ii) Tenant or any Affiliate thereof owns, leases or
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holds an easement over land adjacent to the Property and has installed or constructed or desires to
install or construct any part of the Project on said land at and/or near the common boundary
between the Property and said land, Owner hereby waives any and all setbacks and setback
requirements, whether imposed by law or by any Person, including any setback requirements
described in any applicable zoning ordinance or in any governmental entitlement or permit
heretofore or hereafter issued to Tenant or such Affiliate. Further, if so requested by Tenant or
any such Affiliate, Owner shall promptly, without demanding additional consideration thereof,
execute, and if appropriate cause to be acknowledged and recorded, any setback waiver, setback
elimination or other document or instrument required by any governmental authority or that Tenant
or such Affiliate deems necessary or convenient to the obtaining of any entitlement or permit.
Section 7.7 Confidentiality. Subject to any duties imposed by law by reason of
recordation of the Memorandum of Lease Agreement, Owner shall hold in confidence, and shall
require its principals, officers, employees, representatives and agents to hold in confidence, for the
sole benefit of Tenant, (i) any accountings, (ii) all information pertaining to the Rent and to
calculation of Rent payments (including the sale price of power), (iii) any other financial
information provided by or on behalf of Tenant, (iv) any books, records, computer printouts,
product designs or information regarding Tenant or an Affiliate thereof and (v) any information
regarding resource assessment, energy output or availability from Operations on the Property
(collectively, "Confidential Information"), whether disclosed by Tenant or an Affiliate thereof
or discovered by Owner, unless such Confidential Information either (i) is in the public domain by
reason of prior publication through no act or omission of Owner or its principals, officers,
employees, representatives or agents, or (ii) was already known to Owner at the time of disclosure
and which Owner is free to use or disclose without breach of any obligation to any Person. Owner
shall not use any such Confidential Information for its own benefit, publish or otherwise disclose
such Confidential Information to others, or permit the use of such Confidential Information by
others for their benefit or to the detriment of Tenant. Notwithstanding the foregoing, Owner may
disclose such information to (1) Owner's lenders, attorneys, accountants and other personal
financial advisors, or (2) any prospective purchaser of the Property; provided that in making such
disclosure Owner advises the party receiving the information of the confidentiality thereof and
obtains the agreement of said party to abide by the confidentiality provisions above, and Owner
shall be responsible to Tenant for any failure of any such third party to do so. Owner may also
disclose such information pursuant to any lawful subpoena or court order, in which case Owner
shall give Tenant sufficient advance notice of such proceedings to allow Tenant to oppose the
issuance of the same (or, if this is not possible, as much notice as is practicable). Notwithstanding
the foregoing, certain Laws, such as Iowa Code Chapter 22, may require the disclosure of certain
information or materials otherwise classified as Confidential Information, and no provision of this
Agreement shall be construed to preclude Owner from disclosing information or materials that is
required to be disclosed pursuant to any Laws, including but not necessarily limited to Iowa Code
Chapter 22; provided, however, that prior to such disclosure required pursuant to any Laws, Owner
shall promptly notify Tenant in writing of the request for disclosure and provide Tenant with copies
of all relevant documents related to the request for disclosure and allow Tenant to take any and all
actions Tenant deems necessary and appropriate to protect its Confidential Information, including,
but not limited to, intervening in any legal proceedings related to the disclosure of the Confidential
Information.
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Section 7.8 Division of Lease. If Tenant from time to time so requests and provided
that no uncured Event of Default then exists under this Agreement, Owner shall promptly divide
the Agreement into two (2) or more separate, independent agreements for separate and distinct
solar power projects by entering into two or more new agreements that provide Tenant with
separate leasehold rights to different portions of the Property, as designated by Tenant. Each of
such new agreements shall (i) contain the same terms and conditions as this Agreement (except
for any requirements that have been fulfilled by Tenant prior to the execution of such new
agreements), (ii) be for a term equal to the remaining Term, (iii) contain a grant to Tenant of rights
similar to the Lease Rights, covering such portion or portions of the overall Property as Tenant
may designate, (iv) require payment to Owner of only a proportionate amount of Rent, and
(v) enjoy the same priority as this Agreement over any Encumbrance created by Owner. Further,
in the event of an uncured Event of Default (as defined below) by the Tenant under any such new
agreement, such default shall not affect, or cause a termination of, this Agreement or any other
separate new agreement.
Section 7.9 Estoppel Certificates. Owner shall, within twenty (20) days after request
by Tenant or any Lender, execute and deliver an estoppel certificate substantially in the form of
Exhibit D, attached hereto, (i) certifying (if true) that this Agreement is in full force and effect and
has not been modified, (ii) certifying (if true) that to the best of Owner's knowledge there are no
uncured Events of Default hereunder, and no condition or event exists which, with the passage of
time, would become an Event of Default (or, if any uncured Events of Default or any such
conditions or events exist, stating with particularity the nature thereof), (iii) certifying the status of
any conditions subsequent provided in this Agreement and (iv) containing any other certifications
as may reasonably be requested. Any such statements may be conclusively relied upon by Tenant
and any existing or proposed Lender. The failure of Owner to deliver any estoppel certificate
within such time shall be conclusive upon Owner that (i) this Agreement is in full force and effect
and has not been modified, (ii) there are no uncured Events of Default by Tenant hereunder, and
no conditions or events exist which, with the passage of time, would become an Event of Default,
(iii) any conditions subsequent set forth in this Agreement have been satisfied (except to the extent
that such satisfaction, by the terms of this Agreement, is not due to occur until a future date) and
(iv) the other certifications so requested are in fact true and correct.
Section 7.10 Representations and Warranties of Owner. Owner hereby represents and
warrants to Tenant that, as of the Effective Date:
(a) (i) Owner is the sole fee owner of the Property (or the lesser interest
designated in the Basic Terms and Conditions, as the case may be), and Owner's ownership interest
is subject to no Encumbrances or any agreements that could affect Tenant's use, possession or
occupancy of the Property except those filed in the Real Property Records and those unrecorded
tenancies, lease agreements, claims of lease, or other occupancies or rights of Possession as
enumerated in Exhibit B hereto, true and correct copies of which have been provided to Tenant,
(ii) each Person signing this Agreement on behalf of Owner is authorized to do so, (iii) Owner has
the full and unrestricted legal power, right and authority to enter into this Agreement, to grant the
Lease and the Lease Rights to Tenant and to perform its obligations hereunder, (iv) no other Person
(including any spouse) is required to join in this Agreement in order for the same to be fully
enforceable by Tenant and for Tenant to enjoy all the rights and benefits accorded to it hereunder,
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(v) this Agreement, the Lease and the Lease Rights are and will be in full force and effect, without
the necessity of any consent of or joinder herein by any other Person, (vi) this Agreement
constitutes the valid and binding obligation of Owner, and is enforceable in accordance with its
terms and (vii) Owner is not the subject of any bankruptcy, insolvency or probate proceeding.
(b) To the best of Owner's knowledge, neither this Agreement nor the Property
or any portion thereof is in violation of any Law. Each parcel of the Property is a separate legal
parcel which may be developed, leased and financed in compliance with applicable subdivision
laws and all local ordinances adopted pursuant thereto.
(c) To the best of Owner's knowledge, there are no pending or threatened
actions, suits, claims, legal proceedings or any other proceedings affecting or that could affect the
Property or any portion thereof, at law or in equity, before any court or governmental agency.
(d) To the best of Owner's knowledge, there are no commitments or agreements
with any governmental agency or public or private utility affecting the Property or any portion
thereof that have not been disclosed by Owner to Tenant and listed on Exhibit B hereto.
(e) To the best of Owner's knowledge, there are no other material adverse facts
or conditions relating to the Property or any portion thereof that could delay, interfere with, impair
or prevent Operations or the exercise of any of Tenant's other rights under this Agreement, the
Lease or the Lease Rights, or the financing of the Project.
(f) To the best of Owner's knowledge, the Property is not enrolled in any and
does not benefit from any tax abatements, reduced tax assessments, or other tax programs that are
reasonably expected to be lost as a result of the construction and operation of the Project on the
Property, resulting in an increase in taxes assessed against the Property.
(g) Notwithstanding any other term or provision of this Agreement, except as
expressly set forth in this Agreement, Owner does not provide any warranty or representation with
respect to the condition of the Property or its suitability for Tenant's desired uses, and Owner does
not, and cannot, provide any warranty or representation that Tenant will be issued or obtain all
required or necessary permits, licenses, or approvals as required under any Laws. Owner shall
reasonably support and cooperate with efforts undertaken by Tenant to secure any such required
or necessary permits, licenses, or approvals (see Section 7.5).
ARTICLE 8 DEFAULT; REMEDIES; PROTECTION OF LENDERS
Section 8.1 Default.
(a) Except as qualified by Section 8.2 and 8_4, if Tenant fails to perform its
obligations under this Agreement (an "Event of Default"), then Owner shall have the right to seek
actual monetary damages, specific performance, and/or injunctive relief if Tenant shall have failed
to cure such Event of Default, within thirty (30) days in the case of a Monetary Default or within
one hundred twenty (120) days in the case of a Non -Monetary Default, after Tenant has received
written notice from Owner stating with particularity the nature and extent of such Event of Default
and each Lender has received a duplicate copy of such notice as required by Section 8.4 (a "Notice
23
of Default"); provided, however, that, in the case of a Non -Monetary Default, if the nature or
extent of the obligation or obligations is such that more than one hundred twenty (120) days are
required in the exercise of commercially reasonable diligence for performance of such
obligation(s), then Tenant shall not be in default if Tenant commences such performance within
such one hundred twenty (120) day period and thereafter pursues the same to completion with
commercially reasonable diligence. For purposes hereof, a "Monetary Default" means an Event
of Default consisting of the failure to pay when due any Rent or other monetary obligation of
Tenant to Owner under this Agreement and any other Event of Default is sometimes referred to
herein as a "Non -Monetary Default."
(b) Owner's failure to perform any one of the following shall constitute an
event of default of Owner ("Owner Event of Default"): (i) failure of any representation or
warranty made by Owner in this Agreement to be true and correct in all material respects at any
time during the Term, or (ii) the failure to comply with any provision of this Agreement, and such
failure shall continue uncured for thirty (30) days after notice thereof by Tenant, provided that
Owner is using commercially reasonable efforts to pursue such cure and provided, further, if such
failure is not capable of being cured within such period of thirty (30) days with the exercise of
reasonable diligence, then such cure period shall be extended for an additional reasonable period
of time so long as Owner is exercising commercially reasonable efforts to cure such failure. Upon
the occurrence and during the continuation of an Owner Event of Default, Tenant: (i) shall have
the right to pursue any and all remedies under this Agreement, at law or in equity and (ii) may
terminate this Agreement. The failure to obtain any permit, license, or approval, as required by
any Laws, shall not be a default of Owner.
Section 8.2 Owner's Right to Terminate for Monetary Default.
(a) If and only if a Monetary Default shall occur, and such Monetary Default is
not disputed in good faith by Tenant or a Lender through implementation of the escrow described
in (b) below, then notwithstanding anything to the contrary contained in this Agreement, Owner
may terminate this Agreement while such Monetary Default is still continuing if both of the
following occur:
(i) Tenant fails to cure the Monetary Default within thirty (30) days
after receipt of the written Notice of Default from Owner (with a simultaneous duplicate
copy to each Lender as set forth in Section 8.1(a) and Section 8.4), and then Tenant fails
to cure the Monetary Default within thirty (30) days after receipt of a second Notice of
Default from Owner (with a simultaneous duplicate copy to each Lender), which states in
14 point bold and all capitalized print at the top of the first page of the Notice of Default:
NOTICE OF DEFAULT: FAILURE TO RESPOND COULD RESULT IN
TERMINATION OF LEASE, and
(ii) all Lenders fail to cure the Monetary Default within the forty five
(45) day period permitted to them after receipt of their duplicate Notice of Default, all
pursuant to Section 8.4.
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(b) If Owner alleges that a Monetary Default has occurred but Tenant or any
Lender, in good faith, disputes Owner's contention, Tenant or such Lender may deposit the amount
in controversy in escrow with any reputable third party escrow agent, or may interplead the same,
which amount shall remain undistributed until final, non -appealable decision by a court of
competent jurisdiction or agreement of the parties.
(c) Upon termination or expiration of this Agreement, and in connection with
any Event of Default for which Owner has terminated this Agreement, Owner shall be entitled to
pursue any and all remedies or relief provided under this Agreement or otherwise available to
Owner under Iowa law, including but not limited to, any action of any kind to evict, eject, or
remove the Tenant or any of its property or assets from the Property, including but not limited to
specific performance, or for damages. The Restoration Obligations of Tenant shall survive
termination or expiration of this Agreement and, without limiting this subsection (d), Owner shall
be entitled to commence an action of any kind to seek recovery of damages or other relief in
connection with Tenant's failure to perform its Restoration Obligations as required under this
Agreement. Any remedies or relief available to Owner shall survive any termination of this
Agreement.
Section 8.3 Limitation on Remedies. Except as otherwise expressly set forth in this
Section 8, at all times after the Construction Commencement Date, Owner shall not (and hereby
waives the right to) seek or commence any action or proceeding involving ejectment, eviction,
removal of the Project from the Property, or any other similar remedy or rescission or reformation
of this Agreement, and Owner shall be limited to the remedies authorized in Section 8.1 and 8_2
based on the type of Event of Default (Monetary or Non -Monetary); to be clear, Owner may only
terminate this Agreement for uncured Monetary Default in accordance with Section 8.2. Each of
the parties hereby waives any right to recover consequential damages, indirect or special damages
or lost profits. except as otherwise permitted by this Agreement, and further subject to the
qualification that any damages that arise directly from a default with respect to an obligation of
Tenant or Owner shall not be construed as being an item of consequential damages or an indirect
or special item of damages. In any event, however, lost revenue or loss profits shall not be
recoverable.
Section 8.4 Protection of Lenders.
(a) If Tenant has assigned, hypothecated, mortgaged or pledged all or any
portion of its right, title or interest under this Agreement, in the Lease, in the Lease Rights and/or
in any portion of the Project, it shall promptly give notice of the same (including the address of
the Lender) to Owner, together with a general description of the interest transferred; provided,
however that the failure to give such notice shall not constitute a default or Event of Default under
this Agreement but rather shall only have the effect that Owner shall not be required to recognize
or be bound by such assignment, hypothecation, mortgage or pledge (and all notice and other
requirements in this Article 8 benefiting such Lender shall accordingly be inapplicable to Owner)
until such notice shall have been given.
(b) Every Lender shall have the right, but not the obligation, (i) to make any
payments due under this Agreement, and (ii) to do any other act or thing that may be necessary or
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appropriate to be done in the performance and observance of the terms hereof. All payments so
made and all things so done and performed by any Lender shall be as effective to prevent or cure
any Event of Default under this Agreement as they would have been if made, done and performed
by Tenant, and Owner agrees to accept such performance, payment and cure. Owner agrees to
accept such payment and performance, and authorizes the performing Lender (or its employees,
agents, representatives or contractors) to enter upon the Property to complete such performance
with all the rights, privileges and obligations of Tenant hereunder.
(c) Owner agrees for the benefit of each Lender that it will not, without the
prior consent of such Lender (which consent shall be given or withheld on the basis of the
documents governing the relationship between such Lender and Tenant): (i) amend or modify, or
take any action causing, consenting to or accepting the amendment or modification of this
Agreement, if such amendment or modification would reduce the rights or remedies of such Lender
hereunder or impair or reduce the security for any Lender's Lien, (ii) by agreement with Tenant,
cancel, terminate or suspend this Agreement, the Lease or the Lease Rights or (iii) take any action
causing, consenting to or accepting the cancellation, termination or suspension of this Agreement,
the Lease or the Lease Rights.
(d) Owner shall deliver to each Lender a duplicate copy of any and all Notices
of Default that Owner may from time to time deliver to Tenant, and such copies shall be delivered
to each such Lender at the same time such Notices of Default are delivered to Tenant. Failure to
serve a copy of any such Notice of Default to any Lender shall render the Notice of Default to
Tenant ineffective.
(e) Upon Tenant's failure to cure any Event of Default within the time provided
in Section 8.1, the Lenders shall have an additional forty five (45) days (running concurrently for
each Lender) after the expiration of the time provided in Section 8.1 and Section 8.2 to cure such
Event of Default. However, if such Event of Default is a Non -Monetary Default and cannot, in
the exercise of commercially reasonable diligence, be cured within such additional forty-five
(45) day period, then such Lenders shall have such additional time (running concurrently for each
Lender) to cure such Event of Default as may be reasonably necessary using commercially
reasonable diligence. Any Non -Monetary Default that cannot be cured by such Lenders shall
nevertheless be deemed to have been cured and remedied if (i) on or before forty five (45) days
after receiving the Notice of Default from Owner, any such Lender shall have acquired Tenant's
then -remaining right, title and interest in the Property, or shall have commenced foreclosure or
other appropriate proceedings for such purposes and shall be prosecuting such proceedings to
completion with commercially reasonable diligence, (ii) any such Lender shall have fully cured
within such forty five (45) day period any failure to perform any monetary obligations of Tenant
hereunder and shall thereafter continue to perform such monetary obligations, and (iii) after
obtaining Tenant's then -remaining right, title and interest in the Property, any such Lender
commences performance of the non -monetary obligations of Tenant hereunder and thereafter
pursues the same to completion with commercially reasonable diligence. All rights of Owner to
terminate this Agreement as a result of the occurrence of a Monetary Default hereunder shall be
expressly conditioned upon (i) each such Lender having first received a copy of the Notice of
Default as and when provided in Section 8.4(d) and (ii) such Lenders having together failed to cure
the Event of Default (or, in the case of a Non -Monetary Default, acquire possession of the Property
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or commence foreclosure or other appropriate proceedings) as set forth, and within the time
specified, in this Section 8.4(e).
(f) If any such Lender is prohibited by any process or injunction issued by, or
by reason of any action of, any court having jurisdiction over any bankruptcy, reorganization,
insolvency or other debtor -relief proceeding from commencing or prosecuting foreclosure or other
appropriate proceedings, then the times specified in Section 8.4(e) for commencing or prosecuting
such foreclosure or other proceedings shall be extended for the period of such prohibition;
provided, however, that such Lender (or another Lender) shall have fully cured, within the time
specified in Section 8.4(e), any failure to perform any monetary obligations of Tenant hereunder,
and shall thereafter continue to perform such monetary obligations when and as due hereunder.
(g) The transfer of Tenant's interest under this Agreement to any Lender and/or
to one or more purchasers or tenants (i) at a foreclosure sale by judicial or nonjudicial foreclosure
and sale, (ii) by a conveyance by Tenant in lieu of foreclosure or (iii) by any other assignment or
conveyance, including by a Lender following foreclosure and sale, or as a result of any other legal
proceeding, shall not require the consent of Owner, provided that such Lender and/or purchaser
shall provide written notice to Owner of the transfer of Tenant's interest under this Agreement not
later than thirty (30) days thereafter, and Owner agrees that upon such foreclosure, sale,
conveyance, assignment or other proceeding, Owner shall recognize such Lender or such other
purchaser(s) or Tenant(s) as the successor to Tenant under this Agreement; provided, however,
that, subject to Section 8.4(i), such Lender or such purchaser or Tenant assumes the obligations of
Tenant under this Agreement and pays all amounts in arrears due from Tenant to Owner hereunder.
(h) Neither the bankruptcy nor the insolvency of Tenant shall be grounds for
terminating this Agreement. If this Agreement is rejected by a trustee or debtor -in -possession in
any bankruptcy or insolvency proceeding, or if this Agreement is terminated for any reason in
connection therewith, and if, within sixty (60) days after receiving notice of such rejection or
termination, any Lender shall so request, then, so long as such Lender has cured any Monetary
Default and is making commercially reasonable efforts to cure any Non -Monetary Default as
provided herein, Owner shall execute and deliver to such Lender or its designee a new agreement,
which new agreement shall (i) be on the same terms and conditions as this Agreement (except for
any requirements that have been fulfilled by Tenant prior to rejection or termination of this
Agreement), (ii) be for a term equal to the remaining Term before giving effect to such rejection
or termination, (iii) contain a lease of the portion of the Property in which such Lender had an
interest on the date of such rejection or termination, (iv) contain a grant to the Lender of lease
rights similar to the Lease Rights, covering such portion or portions of the overall Property as such
Lender may designate, (v) require payment to Owner of only a proportionate amount of Rent,
(vi) enjoy the same priority as this Agreement over any lien, Encumbrance or other interest created
by Owner, and (vii) be executed within thirty (30) days after receipt by Owner of notice of the
Lender's election to enter into a new agreement.
(i) No Lender shall have any duty, obligation or liability under this Agreement
prior to the time of its entry into physical possession of the Property or its commencement of
performance of Tenant's obligations under this Agreement or under a new agreement entered into
as provided in Section 8.4(h). If a Lender elects to perform Tenant's obligations under this
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Agreement or to enter into a new agreement as provided in Section 8.4(h), then such Lender shall
not have any personal liability to Owner for the performance of such obligations, and the sole
recourse of Owner in seeking the enforcement of such obligations shall be to such Lender's interest
in the Project and under this Agreement. If a Lender assigns its interest in this Agreement or in a
new agreement entered into pursuant to Section 8.4(h) to any Person, then, provided that such
assignee assumes the obligations of Tenant (or such Lender, as the case may be) under this
Agreement, such Lender shall be released from any further liability hereunder.
(j) There shall be no merger of the Lease or the Lease Rights, or of the
leasehold estate or interest created thereby, with the fee estate in the Property by reason of the fact
that the Lease, the Lease Rights or said leasehold estate may be held, directly or indirectly, by or
for the account of any Person who owns such fee estate or any interest therein, and no such merger
shall occur unless and until all persons then having an interest in such fee estate and all persons
(including any Lender) then having an interest in or under the Lease or the Lease Rights, shall join
in a written instrument effecting such merger and duly record the same.
(k) Without limitation as to Tenant's rights under Section 7.3(b), if there is an
existing deed of trust, mortgage or similar security instrument or Encumbrance creating a lien
against the Property (each a "Mortgage"), Owner agrees to promptly obtain from the holder of
each such Mortgage (each, a "Mortgagee"), an executed subordination and non -disturbance
agreement (an "SNDA") assuring Tenant, any holder of a sub -easement and/or a sublease, and
their respective Lenders that notwithstanding any default by Owner, or any foreclosure or deed in
lieu thereof, Tenant's (and its successors', assigns', sublessees', and subeasement holders') rights
under this Agreement shall continue in full force and effect and their use and possession of the
Property shall remain undisturbed in accordance with the provisions of this Agreement. Such
SNDA will be in a form reasonably acceptable to Tenant, any holder of a subeasement and/or a
sublease, and their respective Lenders, and, at Tenant's sole option, shall be in the form of a direct
SNDA with a holder of a subeasement and/or sublease.
ARTICLE 9 ASSIGNMENT AND SUBLETTING
Section 9.1 Right to Assign or Sublet. Tenant may assign or sublet or apportion or grant
subeasements in or to all or any of Tenant's right, title and interest under this Agreement, in the
Lease and/or in the Lease Rights so long as written notice of such assignment is provided to Owner
after such assignment is effective. Upon any assignment of all of Tenant's right, title and interest
under this Agreement, in the Lease and in the Lease Rights, the assigning Tenant shall
automatically (without the need for any writing) be released from all of its obligations and liability
under this Agreement, except for liabilities that accrued prior to the date of such transfer.
Section 9.2 Right To Encumber. Tenant may, at any time and from time to time,
conditionally or unconditionally, without obtaining the consent of Owner, hypothecate, mortgage,
grant or pledge all or any portion of Tenant's right, title or interest under this Agreement, in the
Lease, in the Lease Rights and/or in any portion of the Project to any Lender as security for the
repayment of any indebtedness and/or the performance of any obligation relating in whole or in
part to the Project or Operations (a "Lender's Lien").
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ARTICLE 10 GENERAL PROVISIONS
Section 10.1 Insurance. Tenant shall obtain and keep in effect a broad form commercial
general liability insurance policy (or its contemporary equivalent), including bodily injury and
property damage coverage, with a limit of no less than Five Million Dollars ($5,000,000), during
the Production Term, and no less than Two Million Dollars ($2,000,000), during the Development
Term and the Construction Term, of combined single limit liability coverage per occurrence,
accident or incident, with a commercially reasonable deductible. The Tenant shall cause the
Owner to be named as an additional insured in such policy, and such policy shall be issued on a
primary and non-contributory basis and Tenant shall deliver to the Owner a certificate of insurance
evidencing said policy, which certificate shall provide that (i) the Owner shall be given notice of
any cancellation or termination of such insurance in accordance with policy terms but not less than
thirty (30) days and (ii) the insurer waives all rights of subrogation against Owner in connection
with any loss or damage covered by such policy. Tenant may satisfy its insurance obligations
under this Section 10.1 through individual insurance policy or policies, blanket insurance policies
or through a program of self-insurance. Owner will carry commercial general liability insurance
coverage covering Owner's indemnity obligations hereunder as well as occurrences, accidents and
incidents resulting from Owner's actions on the Property that (1) occur from and after the Effective
Date (regardless of when the claim is filed) and (2) result of bodily injury, personal injury or death
to any Person and/or damage or destruction of property. Said insurance shall have a combined
single limit of liability per occurrence of not less than one million dollars ($1,000,000) on a single
limit / primary basis and not less than two million dollars ($2,000,000) on an aggregate basis, or
such greater amounts as are typical for comparable projects. Tenant and Lender (if any) shall be
named as additional insureds under Owner's Commercial General Liability policy. Upon written
request by Tenant, Owner shall deliver to Tenant a certificate of insurance evidencing said policy,
which certificate shall provide that (i) the Tenant and Lender (if any) shall be given notice of any
modification, cancellation or termination of such insurance in accordance with policy terms, and
(ii) the insurer waives all rights of subrogation against Tenant in connection with any loss or
damage covered by such policy.
Section 10.2 Environmental Matters.
(a) Owner represents and warrants that, to the best of Owner's knowledge:
(i) the Property is in compliance with Environmental Laws (defined below); and (ii) there are no
Hazardous Materials (defined below) in, on, or under the Property, other than herbicides, pesticides
and fertilizers that have been stored, mixed and applied on the Property in compliance with normal
agricultural practices and in compliance with Environmental Laws. The Tenant acknowledges that
Owner has not performed due diligence, testing, examinations, studies, or related activities with
respect to the Property subject to this Agreement.
(b) Tenant assumes responsibility for and agrees to comply with (i) all
Environmental Laws applicable to Tenant's use of the Property and (ii) all remediation and other
requirements of Environmental Laws related to Hazardous Materials, to the extent located on or
released on, from or onto, the Property by Tenant or its contractors. Owner assumes responsibility
for and agrees to comply with (i) all Environmental Laws applicable to (A) Owner's use of the
Property, or (B) any conditions existing prior to Tenant's first use of the Property pursuant to this
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Agreement, and (ii) all remediation and other requirements of Environmental Laws related to (as
well as all consequences of the existence of) Hazardous Materials located on or released on, from
or onto, the Property prior to Tenant's first use of the Property or as a result of the acts or omissions
of Owner or its employees, agents, invitees, contractors or tenants (other than Tenant).
(c) "Environmental Laws" means any and all federal, state, local, and foreign
environmental, health and/or safety -related laws, ordinances, codes, rules, regulations (as
interpreted by judicial and administrative decisions) relating to protection of the environment,
health and safety, and natural resources. Environmental Laws includes the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended ("CERCLA"),
the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. Sec. 6901 et seq., the rules
and regulations of and enforced by the Iowa Department of Natural Resources ("Environmental
Code"), and the common law.
(d) "Hazardous Materials" means (i) any and all substances, materials,
chemicals, and wastes regulated by Environmental Laws; (ii) "hazardous substance," "pollutant or
contaminant," "petroleum," and "natural gas liquids" as such terms are defined or used in
Section 9601 of CERCLA or by the Environmental Code; or (iii) hazardous wastes, as defined by
RCRA.
(e) No liability shall arise in Tenant from the mere discovery of facts or
conditions existing or pertaining to the Property.
Section 10.3 Use of Water.
(a) Owner hereby grants to Tenant a non-exclusive right to use water from any
and all existing wells on the Property (the "Wells"), together with associated rights to access the
Wells, in connection with the Project. The Wells may not be used by Tenant for other purposes
or the water sold to third parties. Tenant shall have no obligation to maintain, repair, or replace
the Wells; provided, however, that if Tenant's, or its contractors', employees', agents, invitees',
representatives', or tenants' use of the Wells directly damages or destroys a Well, Tenant shall
reimburse Owner for the reasonable and actual costs for the repair of the Well. Tenant agrees that
its use and enjoyment of the Wells shall be undertaken in a manner that does not materially
interfere with Owner's use and enjoyment of the Wells.
(b) To the extent permitted by applicable Laws, Owner grants to Tenant, at
Tenant's sole cost and expense, the right to install, construct, drill, maintain, repair, replace,
relocate, remove and reconstruct a water well, water line, and related facilities on the Property in
connection with the Project (the "Well Facilities").
(c) To the extent permitted by applicable Laws, Owner leases to Tenant the
right to use the surface water pertaining or appurtenant to the Property in connection with the
Project.
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(d) Tenant shall pay Owner, or a governmental entity as directed by applicable
Laws, the fair market value per acre foot of water delivered to and used by Tenant calculated based
on the location of the Property and subject to applicable Laws.
Section 10.4 Indemnity. Owner and Tenant, on behalf of itself and its principals,
members, officers, employees, agents, representatives, contractors, successors and assigns
(the "Indemnifying Party"), shall indemnify, defend and hold harmless the other party
and its principals, members, officers, employees, agents, representatives, contractors,
successors and assigns (collectively, the "Indemnified Party") from and against any
Expenses, including arising from (i) physical damage to property (including the personal
property of the Indemnified Party) or physical injury to or death of any person, in each case
to the extent caused by the negligence or misconduct of the Indemnifying Party, (ii) any
violation by the Indemnifying Party of any Law, or (iii) any material default by the
Indemnifying Party, or any failure to be true of any representation or warranty made by the
Indemnifying Party, under this Agreement. The reference to property damage in the
preceding sentence does not include losses of rent, business opportunities, profits and other
consequential damages that may result from Owner's loss of use of any portion of the
Property occupied by the Project pursuant to the Lease or the Lease Rights; provided,
however, that an Indemnifying Party shall have no obligation to indemnify or defend any
Indemnified Party with respect to any Expenses that result or arise from an Indemnified
Party's acts or omissions, negligence or willful misconduct. The parties acknowledge that
if Owner is a quasi -governmental entity that may have limited legal authority and financial
capacity to indemnify Tenant; then in the event the Indemnifying Party under this Section
is Owner, Owner shall indemnify Tenant to the extent of its legal and financial capacity.
Section 10.5 Safety Measures; Waiver and Recognition.
(a) Owner authorizes Tenant to take reasonable safety measures to reduce the
risk of damage to the Project or the risk that the Project will cause damage, injury or death to
people, livestock, other animals or property, and Tenant may construct fencing around the Project
and take other security precautions if Tenant determines, in its sole discretion, that such fencing
and/or security measures will reduce such risks of damage, death or injury or will protect Tenant's
property. The cost of any fencing constructed by Tenant, or of any other such security measures
taken by Tenant, shall be borne solely by Tenant. Owners shall comply with all safety,
environmental, security, or other procedures reasonably set forth by Tenant as required for
compliance with all applicable rules, regulations, laws, orders, and standards, including those set
forth by the Federal Energy Regulatory Commission, the North American Electric Reliability
Corporation (including the Critical Infrastructure Protection standards), any other applicable
regulatory authority, and any other applicable standard setting -entity generally recognized in the
energy industry.
(b) Owner is aware of the potential risks associated with electromagnetic and
stray voltage resulting from the production and transmission of electricity, and knowingly waives
all claims resulting from these causes, and owner shall have no right to indemnity pursuant to
Section 10.4 for any such claims. Owner additionally recognizes the need to exercise extreme
caution when in proximity to any portion of the project and the importance of respecting gates,
31
fences, signage, rules and other safety measures utilized by tenant, and owner agrees to exercise
such caution and respect such measures at all times and to cause its principals, members, officers,
employees, agents, representatives and contractors to do the same, with failure to do so constituting
a material default and subjecting owner to an obligation of indemnity for the consequences thereof
as set forth in Section 10.4.
Section 10.6 Casualty and Condemnation.
(a) If all or part of the Property is proposed to be taken as a result of any action
or proceeding in eminent domain, or is proposed to be transferred in lieu of condemnation to any
authority entitled to exercise the power of eminent domain (collectively, a "Taking"), Owner shall
provide Tenant with immediate written notice of any impending proceeding or meeting related to
such Taking and shall not in the absence of Tenant settle with the Taking authority or agree on
compensation for such Taking.
(b) After payment of all reasonable fees and expenses incurred by Owner and/or
Tenant in collecting the award, any award or other compensation ("Award") payable as a
consequence of such Taking shall be paid to Owner and Tenant in accordance with their interests
in the Property, as follows:
(i) Tenant shall first be entitled to receive out of the Award (A) the
value of the leasehold estates pursuant to the Lease and the Lease Rights in the portions of
the Property subject to the Taking that would have existed but for the Taking; and (B) the
value of the Project; and (C) any other compensation or benefits payable by law to Tenant
as a consequence of the interruption of Tenant's business and the other costs and expenses
incurred by Tenant as consequence of the Taking; and thereafter,
(ii) Owner shall be entitled to receive out of the Award (A) the value of
its fee interest in the Property; and (B) any remainder of the Award.
(c) This Agreement shall terminate as to any portion of the Property so
condemned or taken (except in the case of a temporary Taking after the duration of which Tenant
desires to continue this Agreement, and the Term shall be extended, in such event, by the duration
of such temporary Taking).
(d) Following any casualty event affecting the Property, or any other facilities
installed thereon by Tenant, including, without limitation, any earthquake or wildfire, Tenant shall
have the right to terminate this Agreement in the event any of the following events occurs:
(i) Net insurance proceeds (after deducting the cost of recovery of such
proceeds) are not available to pay one hundred percent (100%) of the cost of such repair,
excluding any deductible that Tenant may be required to pay pursuant to other provisions
of this Agreement;
(ii) The Property or any facilities installed thereon by Tenant cannot,
with reasonable diligence, be fully repaired by Tenant within one hundred twenty
(120) days after the date of the damage or destruction; or
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(iii) The Property or any facilities installed thereon by Tenant cannot be
safely repaired because of the presence of hazardous factors, including, but not limited to,
earthquake faults, radiation, chemical waste and other similar dangers.
(e) If Tenant elects to terminate this Agreement, pursuant to Section 10.6(d),
Tenant may give Owner written notice of its election to terminate within thirty (30) days after such
damage or destruction, and this Agreement shall terminate fifteen (15) days after the date Owner
receives such notice. To the extend received by Tenant and applicable to such casualty event,
proceeds from insurance maintained by Tenant under Section 10.1 of this Agreement shall be used
by Tenant to complete the Restoration Obligations. If Tenant elects not to terminate this
Agreement, Tenant shall, following the date of such damage or destruction, commence the process
of obtaining necessary permits and approvals, and shall commence repair of its facilities on the
Property as soon as practicable and thereafter prosecute the same diligently to completion, in which
event this Agreement shall continue in full force and effect. All insurance proceeds from insurance
maintained by Tenant under Section 10.1 shall be disbursed and paid to Tenant. Tenant shall not
be entitled to any compensation or damages from Owner for loss of the use of the Property, damage
to Tenant's facilities or personal property or any inconvenience occasioned by such damage, repair
or restoration
Section 10.7 Notices. Any notices, statements, requests, demands, consents,
correspondence or other communications required or permitted to be given hereunder shall be in
writing and shall be given personally, by certified or registered mail, postage prepaid, with delivery
confirmation, return receipt requested, or by overnight or other courier or delivery service, freight
prepaid, to the address of the party to be notified indicated in the Basic Terms and Conditions (and
if to a Lender, the address indicated in any notice to Owner provided under Section 8.4(a)). If to
Tenant, a copy shall also be sent (which shall not constitute notice) to any and all Lenders, to
Tenant's counsel at the address below, and any other party designated by Tenant in writing.
With a copy to:
Carl H. Bivens, Esq.
Troutman Pepper Locke
1001 Haxall Point
Richmond, Virginia 23219
Notices delivered by hand shall be deemed delivered when actually received, and notices sent by
certified or registered mail with delivery confirmation or by overnight or other courier or delivery
service shall be deemed delivered upon actual receipt, and shall be deemed to have been given on
the day of actual delivery to the intended recipient (as evidenced by written acceptance of delivery
by the recipient) or on the day delivery is refused. Owner and Tenant and any Lender may change
its address for receipt of notices by sending notice hereunder of such change to the other party (in
the case of a Lender, both parties) in the manner specified in this Section. Notwithstanding the
foregoing, any amounts payable to Owner under this Agreement shall be deemed tendered three
(3) days after a check for the same, addressed to Owner's address above, is deposited in the United
States mail, first-class postage prepaid.
Section 10.8 Force Majeure. Notwithstanding any other provision of this Agreement, the
obligations of Owner and Tenant under this Agreement (other than monetary obligations, none of
33
which shall be excused or delayed by reason of this Section) shall be suspended and excused, and
the term, and any other time periods set forth herein shall continue and be extended for a like
period of time, while such party is hindered or prevented, in whole or in part, from complying with
any term, covenant, condition or provision of this Agreement, by any Event of Force Majeure.
Section 10.9 Meetings with Third Persons. During the Term, Tenant and its
representatives, agents and contractors shall have the right to (i) meet with governmental agencies
and with any other Persons with whom Owner has contractual arrangements in connection with or
relating to the Property or any portion thereof, and (ii) discuss with any such Persons the terms of
this Agreement, the terms of any contractual arrangements between Owner and any such Person,
and any other matters relating to the Property or Tenant's intended use of the Property.
Section 10.10 Termination by Tenant.
(a) Tenant shall have the right to terminate this Agreement as to all or any
portion of the Property at any time and without cause, and shall execute and cause to be
acknowledged and recorded in the Real Property Records a release describing the portion of rights,
title or interest released, which release shall be deemed delivered to and accepted by Owner upon
such recordation. Tenant shall provide Owner notice of any such termination. The portion of the
Property remaining after any partial termination of this Agreement shall thereafter be the
"Property" for purposes of this Agreement and all payment amounts based on acreage shall be
adjusted accordingly. Upon termination of the Lease in its entirety prior to the Construction
Commencement Date, Tenant shall not have any obligations with respect to the Restoration Term
or the Restoration Obligations.
(b) No act or failure to act on the part of Tenant (including, without limitation,
non-use of any portion of the Property for any particular period of time) shall be deemed to
constitute an abandonment or surrender of the Lease, the Lease Rights or any portion thereof other
than Tenant's releases given pursuant this Section 10.10.
(c) Following the expiration or earlier termination of this Agreement and
Tenant's completion of its obligations with respect to the Restoration Term, Tenant shall execute
and cause to be acknowledged and recorded in the Real Property Records a release of all of
Tenant's right, title and interest in the Property.
(d) Notwithstanding any other Section or provision of this Agreement to the
contrary, Owner shall have the right to terminate this Agreement at any time, with or without
cause, during the Restoration Term. The limitation of remedies available to Owner hereunder shall
otherwise apply in the event Owner terminates this Agreement during the Restoration Term. In the
event Owner terminates this Agreement during the Restoration Term, then all of Tenant's
obligations under the Restoration Term, including, without limitation, satisfaction of the
Restoration Obligations, shall become null and void and Tenant shall not have any further
obligations with respect to the Restoration Term or Restoration Obligations.
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Section 10.11 Third Party Beneficiaries. Except with respect to the rights of Lenders
(which Lenders are hereby expressly made third party beneficiaries hereof to the extent of their
respective rights hereunder), the agreements and covenants contained herein are made solely for
the benefit of Owner and Tenant, and shall not be construed as benefiting any Person who is not a
party to this Agreement.
Section 10.12 Attorneys' Fees. In the event of any litigation related to the interpretation
or enforcement hereof, or which in any other manner relates to the Lease, the Lease Rights, this
Agreement or the Property, the prevailing party shall be entitled to recover from the other party all
of its attorneys' fees and court and other costs awarded by a court of competent jurisdiction.
Section 10.13 Covenants Running With the Land. The Property shall be held, conveyed,
assigned, hypothecated, encumbered, leased, used and occupied subject to the provisions of this
Agreement, which provisions shall run with the Property, and shall be binding upon and inure to
the benefit of the parties and each other Person having any interest therein during their ownership
thereof, and their respective tenants, heirs, executors, administrators, successors and assigns.
Section 10.14 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the state in which the Property is situated.
Section 10.15 Memorandum. Concurrently with execution hereof, the parties shall
execute a Memorandum of Lease Agreement in the form attached to this Agreement as Exhibit C
and cause it to be acknowledged and recorded in the Real Property Records at Tenant's cost.
Section 10.16 Joint and Several Liability. If Owner consists of more than one Person,
each reference herein to "Owner" shall include each Person signing this Agreement as or on behalf
of Owner and the liability of each Person signing this Agreement as Owner shall be joint and
several.
Section 10.17 Binding on Partial Interests. If this Agreement is not executed by one or
more of the persons or entities comprising the Owner herein, or by one or more persons or entities
holding an interest in the Property, then this Agreement shall nonetheless be effective, and shall
bind all those persons and entities who have signed this Agreement.
Section 10.18 Savings Clause. If any term or provision hereof is held to be invalid, void
or otherwise unenforceable by any court of competent jurisdiction, then the same shall not affect
the validity or enforceability of any other term or provision hereof, the terms and provisions hereof
being severable.
Section 10.19 No Waiver. The waiver of any covenant, condition or agreement contained
herein shall not constitute a waiver of any other covenant, condition or agreement herein or of the
future performance thereof.
Section 10.20 Entire Agreement; Modifications; Conflicts. This Agreement, including
any Exhibits attached hereto, contains the entire agreement between the parties in connection with
any matter mentioned or contemplated herein, and all prior or contemporaneous proposals,
agreements, understandings and representations, whether oral or written, are merged herein and
35
superseded hereby. No modification, waiver, amendment, discharge or change of this Agreement
shall be valid unless the same is in writing and signed by the party against whom the enforcement
thereof is sought. The submission of this document for examination and negotiation does not
constitute an offer to lease, or a reservation of, or option for, the Property, and this document shall
become effective and binding only upon the execution and delivery hereof by both Owner and
Tenant. In the event of a conflict between the provisions contained in the Basic Terms and
Conditions and the provisions of the body of this Agreement, the provisions of the Basic Terms
and Conditions shall control.
Section 10.21 Multiple Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed an original and all of which when taken together shall constitute
one and the same document.
Section 10.22 Provision of Copy of Lease. After execution by all parties to the
Agreement, if Owner so requests in writing, Tenant shall provide, within thirty (30) days of receipt
of such written request, Owner one (1) complete copy of this Agreement.
Section 10.23 Cooperation on Owner's Interest. It is the intent of the parties hereto that
all of Owner's undivided ownership interest in the Property be leased to Tenant hereunder. Owner
agrees that in the event Owner's undivided ownership interest in the Property is more or less than
that specified in the Basic Terms and Conditions, Owner shall, at no additional cost to Tenant,
execute any and all amendments to this Agreement, the Memorandum of Lease Agreement (such
amendment in recordable format) and such other documents as reasonably required to reflect
Owner's proper undivided ownership interest. Owner agrees to reasonably cooperate with Tenant
in completing any such amendments and in facilitating associated corrections with any title
company working with Tenant.
Section 10.24 Restricted Area. Notwithstanding any provision of this Agreement to the
contrary, Tenant shall not construct or install Solar Panels on that portion of the Property identified
on Exhibit A-1 attached hereto as the "Solar Panel Restricted Area (Approx. 55.4 Acres)" (the
"Restricted Area"), but Tenant shall have all other rights granted by this Agreement with respect
to such portion of the Property, including, without limitation, installation of other Solarpower
Facilities (such as transmission lines).
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
36
Execution Version
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed and
delivered by their duly authorized representatives as of the Effective Date.
OWNER:
Waterloo Airport Commission
By:
Printed Name: David Boesen
Title: Mayor
[Signature Page]
TENANT:
GRAND HUSK SOLAR, LLC
a Delaware limited liability company
By:
Printed Name:
Title:
[Signature Page]
Execution Version
Attachments:
Exhibit A — Description of Property
Exhibit A-1 — Restricted Area
Exhibit B — Permitted Encumbrances
Exhibit C — Memorandum of Lease Agreement
Exhibit D — Form of Estoppel Certificate
Execution Version
EXHIBIT A
Description of Property
257.99 acres of land, more or less, in Black Hawk County, Iowa, identified as follows:
Parcel Number: 891304426003
Acreage: 89.24
Legal Description:
The Southeast Quarter of the Northeast Fractional Quarter of
Section No. Four (4). except the East Fifty (50) feet thereof
condemned for road purposea, and the Northeast Quarter of the
Southeast Quarter of Section No. Four (4) except the East
Fifty (50) feet thereof condemned for road purposes, and the
southeast Quarter of the -Southeast Quarter of Section No.
Four (4) except the South Fifty (50) feet thereof and except
the East Fifty (50) feet thereof condemned for road purposes.
all in Township No. Eighty-nine (89) North. Range No. Thirteen
(13) West of the Fifth (5th) Principal Meridian, in Black
Hawk County. Iowa.
AND
Parcel Number: 901330401001
Acreage: 39.8
Parcel Number: 901330451002
Acreage: 34.3
Legal Description of Parcel Numbers 901330401001 and 901330451002:
1'1)c• IVt•st (hie-hai( (W I 2) of the Southeast One-fixtrtl (Sl: 1 4) all In
kcttlon 1'ItirR' (3O). Fi wnshlp Ninety (9H)) North of Range 'I'hirteef (13)
West of tik Fifth Principal Meridian, Black 1 lavk County, Iowa.
AND
Parcel Number: 901332101001
Acreage: 37.50
Legal Description:
The jorthse t .tusrter, of the Northwest 4uer tor of .imctton
No. 'htrty-teo (?2) Aownahtj No. ninety (9. ) ttcrtt4 asrr.e�s
:.o. Thirteen (1.3) Rest of the fifth (5th) Frincite1 +iariatan.
!n block tisirk County, Ione,
Exhibit A
AND
Parcel Number: 901329451002
Acreage: 19.25
Parcel Number: 901329476001
Acreage: 37.9
Legal Description of Parcel Numbers 901329451002 and 901329476001
Southeast i,2uorier c,f the Southeast Stuart?r on0 t .:Ast
Ore -half of the Southwest C::uarter of the Southeast ivarf. ,
all in Section No. Two*nty-nine (29), Township No. Ninct,.
t90) North, [?crn;je f . Thirteen (13) s est of the 5th Princi-
pol Meriuion, in Biawk Hawk County, Iowa.
Execution Version
EXHIBIT A-1
Restricted Area
2.850
W Dunkerton Rd
Parcel IDs: 901332101001, 891304426003,
901329476001, & 901329451002
Approx. Acreage: 184.05 acres
5,700 Feet
Property Boundary
Solar Panel Restricted Area (Approx. 60.55 acres)
EXHIBIT B
Permitted Encumbrances
(None, unless listed below)
EXHIBIT C
Memorandum of Lease Agreement
[full document begins on following page]
Exhibit C-1
This document was prepared by and
after recording return to:
Attn: Lease & Title Department
Grand Husk Solar, LLC
320 N. Sangamon Street, Suite 1025
Chicago, Illinois 60607
Telephone Number:
Parcel Identification Numbers: 891304426003, 901330401001, 901330451002, 301332101001, 901329451001,
and 901329476001
MEMORANDUM OF LEASE AGREEMENT
THE STATE OF IOWA §
KNOW ALL PERSONS BY THESE PRESENTS:
COUNTY OF BLACK HAWK
THIS MEMORANDUM OF LEASE AGREEMENT (this "Memorandum"), is made,
dated and effective as of (the "Effective Date"), by WATERLOO
AIRPORT COMMISSION of 715 Mulberry St. Waterloo, IA 50703 ("Owner"), and GRAND
HUSK SOLAR, LLC, a Delaware limited liability company, with offices at 320 N. Sangamon
Street, Suite 1025, Chicago, Illinois 60607 ("Tenant"), with regards to the following:
1. Solar Agreement. Owner and Tenant did enter into that certain Lease Agreement
of even date herewith (the "Agreement"), which affects the real property located in the County of
Black Hawk, State of Iowa, as more particularly described in Exhibit A attached hereto (the
"Property"). Capitalized terms used and not defined herein have the meaning given the same in
the Agreement.
2. Grant of Rights. The Agreement grants Tenant: (a) the exclusive right to study,
develop and use the Property for converting solar energy into electrical energy and collecting and
transmitting the electrical energy so converted; (b) the exclusive right to access, relocate and
maintain the "Project," as that term is defined in the Agreement, on the Property; (c) an exclusive
right to capture, use and convert the unobstructed solar resources over and across the Property; (d)
a non-exclusive right for any audio, visual, view, light, shadow, noise, vibration, air turbulence,
wake, electromagnetic or other effect of any kind attributable to the development of the Property
for solar energy purposes and operation of the Project; (e) the right to subjacent and lateral support
for the Project; (f) the right of ingress to and egress from the Project on, under, over and across the
Property by means of (A) roads and lanes thereon if existing or (B) such routes, roads and lanes as
Tenant may construct from time to time as provided in the Agreement; (g) the exclusive right to
erect, construct, reconstruct, replace, relocate, remove, operate, maintain and use, on, under, over
and across the Property, in connection with Project overhead and underground electric
transmission and communication system lines and facilities; and (h) the right to undertake any
Exhibit C-2
other activities, as permitted in the Agreement, necessary to accomplish the purposes of the
Agreement.
3. Term; Extensions. The Agreement shall be for an initial Development Term of
up to seven (7) years from the Effective Date. If exercised pursuant to the terms and conditions of
the Agreement, the term of the Agreement may be extended for a Construction Term of up to three
(3) years following the Development Term. If exercised pursuant to the terms and conditions of
the Agreement, the term of the Agreement may be extended for a Production Term of twenty (20)
years following the Construction Term. The Agreement also provides for a right to extend the
Production Term for up'to four (4) separate Extension Terms of five (5) years each, totaling twenty
(20) additional years, as determined by Tenant, and if the extension terms and conditions of the
Agreement are met, such renewals to be exercised by Tenant at least 180 days prior to the then -
current expiration date of the Production Term or Extension Term, as the case may be. The
Restoration Term shall begin on the expiration or earlier termination of (a) the Construction Term,
if it occurs and if construction has commenced, or (b) the Production Term, if Tenant does exercise
an option to extend the term of the Lease through the Production Term, and shall expire on the
earlier of (y) 12 months from such date, or (z) when Tenant completes the Restoration Obligations.
All rights granted pursuant to the Agreement are for a term coterminous with the Agreement.
4. Rights of Mortgagees. Pursuant to the Agreement, any Lender of Tenant or
Tenant's assignees has certain rights regarding notice and right to cure any default of Tenant under
the Agreement, as well as other rights as set forth in the Agreement.
5. Assignment. Tenant's rights and obligations under the Agreement are assignable
without Owner's prior written consent so long as written notice of such assignment is provided to
Owner after such assignment is effective. Upon any assignment of all of Tenant's right, title and
interest under the Agreement, the assigning Tenant shall automatically (without the need for any
writing) be released from all of its obligations and liability under the Agreement, except for
liabilities that accrued prior to the date of such transfer.
6. Non -Interference and Setbacks. To the extent permitted by law Owner has waived
any and all setbacks and setback requirements, whether imposed by applicable law or by any
person or entity, including any setback requirements described in the zoning ordinance of the
County of Black Hawk, or in any governmental entitlement or permit heretofore or hereafter issued
to Tenant, such sublessee or such Affiliate. Owner has agreed not to engage in any activity that
might interfere with Tenant's efforts to develop, construct or operate the Project or cause a
decrease in the output or efficiency of the Project without the prior written consent of Tenant.
7. Subordination. The Agreement provides that from and after its effective date, any
right, title or interest created by Owner in favor of or granted to any third party shall be subject to
(i) the Agreement and all of Tenant's rights, title and interests created thereby, (ii) any lien of any
lender of Tenant's then in existence on the leasehold estate created by the Agreement, and (iii)
Tenant's right to create a lien in favor of any lender of Tenant's.
8. Agreement Controls. This Memorandum does not supersede, modify, amend or
otherwise change the terms, conditions or covenants of the Agreement, and Owner and Tenant
Exhibit C-3
executed and are recording this Memorandum solely for the purpose of providing constructive
notice of the Agreement and Tenant's rights thereunder. The terms, conditions and covenants of
the Agreement are incorporated in this Memorandum by reference as though fully set forth herein.
9. No Ownership. Owner shall have no ownership, lien, security or other interest in
any of the Project installed on the Property, or except for as otherwise provided in the Agreement,
any profits derived therefrom, and Tenant may remove any or all Project at any time.
10. Cooperation. Owner shall fully support and cooperate with Tenant in the conduct
of construction and Operations, including in Tenant's efforts to obtain from any governmental
authority or any other Person any environmental impact review, permit, entitlement, approval,
authorization or other rights necessary or convenient in connection with construction and
Operations. Without limiting the generality of the foregoing, in connection with any application
by Tenant for a governmental permit, approval, authorization, entitlement or other consent, Owner
agrees (and shall use reasonable efforts to cause any such other Person to agree) not to oppose, in
any way, whether directly or indirectly, any such application or approval at any administrative,
judicial or legislative level. Further, in the event of legal proceedings related to Tenant's use of the
Property after the Effective Date, except those arising out of the interpretation and/or enforcement
of the Agreement, Owner shall, in all respects, fully cooperate with Tenant in any such proceeding.
Owner agrees that Tenant may provide this Memorandum of Lease Agreement in lieu of any
affidavit of Owner or other form of Owner's consent (whether oral or written) that may be
requested or required in connection with Tenant's efforts to obtain any environmental impact
review, permit, entitlement, approval, authorization, agreement or other rights necessary or
convenient in Tenant's discretion for the Project.
11. Counterparts. This Memorandum may be executed in counterparts, each of which
shall be deemed an original and all of which when taken together shall constitute one and the same
document.
[signatures appear on following page]
Exhibit C-4
IN WITNESS WHEREOF, the parties have executed this Memorandum to be effective as
of the date first written above.
OWNER:
Waterloo Airport Commission
By:
Printed Name: David Boesen
Title: Mayor
STATE OF
COUNTY OF
§
§
§
This instrument was acknowledged before me by David Boesen, Mayor, and known to me to be
the person whose name is subscribed to the foregoing instrument, and acknowledged to me that he
executed the same for the purposes and consideration therein expressed.
Given under my hand and seal this day of , 20 .
My Commission Expires:
Notary Public in and for the State of
(Notary Seal)
Exhibit C — Signature Page
TENANT:
GRAND HUSK SOLAR, LLC,
a Delaware limited liability company
By:
Printed Name:
Title:
STATE OF ILLINOIS
COUNTY OF COOK
This instrument was acknowledged before me by
of Grand Husk Solar, LLC, a Delaware limited liability company, on behalf
of said company, and known to me to be the person whose name is subscribed to the foregoing
instrument, and acknowledged to me that he executed the same for the purposes and consideration
therein expressed.
Given under my hand and seal this day of , 20
My Commission Expires:
Notary Public in and for the State of Illinois
(Notary Seal)
Exhibit C — Signature Page
Execution Version
EXHIBIT "A" to
MEMORANDUM OF LEASE AGREEMENT
Description of Property
257.99 acres of land, more or less, in Black Hawk County, Iowa, identified as follows:
Parcel Number: 891304426003
Acreage: 89.24
Legal Description:
The Southeast Quarter of the Northeast Fractional Quarter of
Section No. Four (4). except the Cast Fifty (50) feet thereof
condemned far road purposes, and the Northeast Quarter of the
Southeast Quarter of Section No. Four (4) except the East
Fifty (50) feet thereof condemned for road purposes, and the
Southeast Quarter of the -Southeast Quarter of Section No.
Four (4) except the South Fifty (50) feet thereof and except
the East Fifty (50) feet thereof condemned for road purposes,
all in Township No. Eighty-nine (89) North, Range No. Thirteen
(13) West of the Fifth (5th) Principal Meridian, in Black
Hawk County. Iowa.
AND
Parcel Number: 901330401001
Acreage: 39.8
Parcel Number: 901330451002
Acreage: 34.3
Legal Description of Parcel Numbers 901330401001 and 901330451002:
1'itc� Wrsr Onc•-hal( (W I 2) of Southcast Onc•-(mnrrtl (till 1 4) all In
Sol ion I'hirly (30), rownshih ('K)) North crf R(tngt, 'Fhirtc•4•rt (13)
W4'st of lira VI !Vine ilutl Mrrklian, HIack Hawk County, Iowa.
AND
Parcel Number: 901332101001
Acreage: 37.50
Legal Description:
Exhibit A to Exhibit C
T!» :iorttoiirirt 4uerter cf tt,4 :iortb. t ,unrt;tr cf ..;,action
•bt: ty-two (:'.:) •crinahli :;o. ninaty (9. i :crtre, Zec e
;;o. Thlctaesa 11.31 fie3t of t:a fiftb (5th) Frinctye, d ridLan,
in black Hawk County, tows,
AND
Parcel Number: 901329451002
Acreage: 19.25
Parcel Number: 901329476001
Acreage: 37.9
Legal Description of Parcel Numbers 901329451002 and 901329476001
S3utheosl .. carter at the Southwast uuorter un.i ;nt test
Or,e--holf of the Southwest Quarter of the Southeast Quarter,
Oil in Section No. Twenty-nine (29), Township No. Ninety
(90) North, 2._nje rb. Thirteen (13) 0,est of the .5th Princi-
pal Meri.iion, in BIack Hawk County, Iowa.
([
Owner:
Tenant:
Collateral Agent:
1)
r
Execution Version
EXHIBIT D
Form of Estoppel Certificate
ESTOPPEL CERTIFICATE
1, a Delaware limited liability company
1., as collateral agent (the "Collateral Agent")
for the Secured Parties (as defined in the Financing Agreement (as defined
below)) ("Secured Parties")
Collateral Agent's Address:
Tax Equity Investor:
Attention: [
Email: f
1, as Class A Investor (as defined in the ECCA (as defined
below)) ("Tax Equity Investor")
Tax Equity Investor's Address:
f 1
Attn: [
1
Attention: [ 1
Email: [ 1
with a copy to (which shall not constitute notice):
r 1
f 1
f 1
Attention: [
Email: [ 1
Exhibit D-1
Title Company: [ 1, a F 1 corporation (the "Title Company", together
with the Collateral Agent and the Tax Equity Investor, the "Relying
Parties")
Title Company Address:
f 1
f 1
f l
1
Attention: [
Lease:
Property: Description attached hereto as Exhibit B.
Owner hereby certifies the following to (a) the Collateral Agent, for the benefit of the
Secured Parties, and its successors, assigns and/or designees, (b) Tax Equity Investor, (c) Tenant
and (d) the Title Company and its successors, assigns and/or designees, in each case, as of the
Effective Date (as defined below) concerning the above -referenced Lease and the Property, with
the understanding that (i) the Collateral Agent and the Secured Parties will be relying on such
statements with respect to loans, letters of credit and other financial accommodations to be made
to Tenant and/or affiliates of the Tenant under that certain Financing Agreement, dated as of
1, 20 (as amended, amended and restated, supplemented or otherwise modified
from time to time, the "Financing Agreement"), by and among [ 1, a
Delaware limited liability company, [ 1, a [ 1 (collectively, the
"Borrowers"), the Collateral Agent, and the other agents, arrangers and financial institutions or
other Persons from time to time party thereto, (ii) the Tax Equity Investor will be relying on such
statements with respect to tax equity investments and other financial accommodations to be made
to Tenant and/or affiliates of the Tenant under that certain Equity Capital Contribution Agreement,
dated as of [ 1, 20_ (as amended, amended and restated, supplemented or otherwise
modified from time to time, the "ECCA"), by and between [ 1, a [ 'limited
liability company, and the Tax Equity Investor, (iii) the Tenant will be relying on such statements
with respect to the loans, letters of credit and other financial accommodations to be made in
connection with the Financing Agreement and the tax equity investments and other financial
accommodations to be made in connection with the ECCA and (iv) the Title Company will be
relying on such statements with respect to the issuance of title insurance policies to the Collateral
Agent and Tenant:
1. A true, correct and complete copy of the Lease (and all amendments and
supplements thereto) is attached to this Estoppel Certificate as Exhibit A and incorporated herein
for all purposes. There are no other documents or agreements (written or oral) that are a part of
the Lease and no other documents or agreements (written or oral) between Owner and Tenant with
respect to the Property or the Project. The parties agree that the copy of the Lease attached hereto
as Exhibit A shall be removed prior to recordation of this Estoppel Certificate; provided, however,
that the absence of such Exhibit A for recordation purposes shall not affect the effectiveness of
Exhibit D-2
this Estoppel Certificate and the representations, acknowledgements and agreements described
herein.
2. The Lease is in full force and effect and has not been modified, restated, cancelled,
supplemented, surrendered, or terminated (except as identified herein). The Lease represents the
entire agreement between Owner and Tenant with respect to the Property subject to the Lease.
The term of the Lease commenced on and will expire on
unless extended as provided in the Lease. Tenant has the right to extend the term of the Lease for
( )] extension term of [ ( ) years and ( ) months]. Owner has not received
notice of any prior assignment or sublease of any right, title or interest of Tenant in, to or under
the Lease.
3. To Owner's knowledge, Tenant has fulfilled all of its obligations under the Lease
now due and owing, and there are no uncured Events of Default of Tenant with respect to the
Lease. There are no uncured Events of Default of Owner with respect to the Lease. There currently
exists no dispute (or any threatened dispute) between Owner and Tenant with respect to the Lease
and there are no delinquent payments under the Lease. Owner has no present right to terminate
the Lease. Tenant has neither given nor received any notice of default, Event of Default or
termination of the Lease. Owner has neither given nor received any notice of default Event of
Default or termination of the Lease. There are no facts or circumstances which with the giving of
notice or lapse of an applicable cure period, or both, would constitute a breach or default under the
Lease.
4. Owner is the current holder of the fee title of the surface estate and the mineral
estate to the Property described in the Lease. Owner: (a) holds the entire interest of owner under
the Lease; (b) has not conveyed, mortgaged, assigned or otherwise transferred the Property or
Owner's interest in the Lease to any third party; and (c) has not agreed to convey, mortgage, assign
or otherwise transfer the Property or Owner's interest in the Lease to any third party. Owner
acknowledges that pursuant to the Lease, Owner shall not exercise or lease or permit any other
person or entity to exercise any water or mineral rights on the surface of the Property, or above a
depth of 500 feet on the Property or if such exercise by Owner interferes with Tenant's use of the
Property for the purpose of installation, construction, operation, maintenance, repair,
improvement, or replacement of the Project and uses incidental thereto. All representations made
by Owner and Tenant in the Lease are true and correct in all material respects as of the date hereof.
5. Except for the lien for this year's property taxes that are not now due and payable,
there are no judgments, liens, deeds of trust or mortgages encumbering the Property and there are
no unpaid bills, outstanding claims or persons entitled to claims for mechanics or materialmens'
liens against the Property for work performed on the Property by or for Owner (as opposed to work
performed on the Property by or for Tenant).
6. Owner acknowledges receiving notice of the name and address of each Relying
Party.
7. Tenant has informed Owner that Tenant has granted a first -priority lien and security
interest in Tenant's leasehold estate in the Property under the Lease and the Project to the Collateral
Exhibit D-3
Agent to secure the repayment of the loans and other financial accommodations made under the
Financing Agreement. Owner agrees that (i) the Collateral Agent, the Secured Parties, the Tax
Equity Investor and any affiliates, successors and assigns, shall be deemed to be and shall be
entitled to all of the rights, benefits and protections of, a "Lender" pursuant to Section [ -I of the
Lease and the other provisions thereof, and (ii) the Collateral Agent, the Secured Parties, the Tax
Equity Investor and any affiliates, successors and assigns and transferees, shall be deemed to be
and shall be entitled to all of the rights, benefits and protections of, an "Assignee" pursuant to
Section [ ] of the Lease and the other provisions thereof. Notwithstanding the foregoing, the
rights of the Collateral Agent and the Tax Equity Investor or any affiliates, successors and assigns
with respect to an assignment or transfer of the Lease shall be subject to Paragraph 8 below.
8. In addition to the provisions specified in Section [ 1 of the Lease, the following
shall apply to the Collateral Agent, the Tax Equity Investor, their affiliates, successors and assigns
(for so long as the Collateral Agent, the Tax Equity Investor, their affiliates, successors and assigns
remain a "Lender" under the Lease) and to each other person that provides written notice to Owner
that it is a "Lender" under the Lease (and for so long as each such person remains a "Lender"
under the Lease):
8.1 Owner agrees to provide notice of any request by Tenant for any
amendment, modification, or supplement to the Lease to the Collateral Agent and the Tax Equity
Investor at the address provided to Owner by the Collateral Agent and the Tax Equity Investor.
Owner agrees that, for so long as a Collateral Agent or Tax Equity Investor is a "Lender" under
the Lease, Owner shall provide such notices to the Collateral Agent and the Tax Equity Investor
at the address already provided to Owner (or at such other address as the Collateral Agent or the
Tax Equity Investor may from time to time provide).
8.2 The Collateral Agent shall have the absolute right, without Owner's
consent, to take any of the following actions or do any of the following: (i) assign, amend, modify
and/or restate its Deed of Trust (as defined below); (ii) enforce its Deed of Trust; (iii) acquire title
to Tenant's leasehold estate under the Lease (whether by foreclosure under its Deed of Trust or
assignment in lieu of foreclosure); (iv) take possession of the Project or the Property pursuant to
its rights under its Deed of Trust and operate the Project subject to compliance with the Lease; (v)
following acquisition of title (or a third party's acquisition of title) to Tenant's leasehold estate
under the Lease as a result of the Collateral Agent's foreclosure or assignment in lieu of
foreclosure, (a) assign or transfer Tenant's leasehold estate under the Lease to a successor third
party, (b) engage an operator experienced in the operation of photovoltaic solar projects or (c)
comply with the assignment provisions of the Lease; (vi) exercise any rights of Tenant with respect
to the Lease or (vii) cause a receiver to be appointed to do any of the foregoing things. Tenant has
entered into (a) the Deed of Trust (as defined in the Financing Agreement) ("Deed of Trust"), in
favor of the Title Company, as trustee for the benefit of the Collateral Agent.
8.3 The Collateral Agent shall have no obligation under the Lease prior to the
time that the Collateral Agent succeeds to absolute title to the leasehold estate of Tenant under the
Lease; and the Collateral Agent shall be liable to perform obligations under the Lease only for and
during the period of time that the Collateral Agent directly holds such absolute title. Further, in
the event that the Collateral Agent elects, prior to the time that such Collateral Agent succeeds to
Exhibit D-4
absolute title to the leasehold estate of Tenant under the Lease, to (i) perform Tenant's obligations
under the Lease, (ii) continue Tenant's operations on the Property, (iii) acquire any portion of
Tenant's right, title or interest in the Property or under the Lease or (iv) enter into a new agreement
as provided in Paragraph 8.4 below, then the Collateral Agent shall not have any personal liability
to Owner in connection therewith, and Owner's sole recourse in the event of default by the
Collateral Agent shall be to exercise those remedies of Owner permitted pursuant to the Lease.
Moreover, the Collateral Agent or other party who acquires the leasehold estate created by the
Lease pursuant to foreclosure or an assignment in lieu of foreclosure shall not be liable to perform
any obligations thereunder to the extent the same are incurred or accrue after the Collateral Agent
or other party no longer has ownership of such leasehold estate.
8.4 In the event that the Lease is rejected or disaffirmed pursuant to bankruptcy
law or any other law affecting creditor's rights, then, so long as the Collateral Agent has cured any
monetary event of default by Tenant and is making commercially reasonable efforts to cure any
non -monetary event of default by Tenant (other than the bankruptcy of Tenant) as provided therein,
Owner shall, immediately upon written request from the Collateral Agent received within ninety
(90) days after any such termination, rejection or disaffirmance, without demanding additional
consideration therefor, enter into a new agreement in favor of the Collateral Agent, which new
agreement shall (i) contain the same covenants, agreements, terms, provisions and limitations as
the Lease (except for any requirements that have been fulfilled by Tenant prior to such termination,
rejection or disaffirmance), (ii) be for a term commencing on the date of such termination, rejection
or disaffirmance, and continuing for the remaining term of the Lease before giving effect to such
termination, rejection or disaffirmance and (iii) enjoy the same priority as the Lease over any lien,
encumbrance or other interest created by Owner. On execution of such new agreement by the
Collateral Agent, and until such time as such new agreement is fully executed and delivered by all
parties, the Collateral Agent may enter, use and enjoy the Property and conduct operations thereon
as if the Lease were still in effect. At the option of the Collateral Agent, the new agreement may
be executed by a designee of the Collateral Agent, without the Collateral Agent assuming the
burdens and obligations of Tenant thereunder. If more than one "Lender" makes a written request
for a new agreement pursuant hereto, then the same shall be delivered to the Collateral Agent
whose Deed of Trust is senior in priority.
9. Owner acknowledges its obligation to give notice of any act of default of Tenant
under the Lease to the Collateral Agent and the Tax Equity Investor at its address stated above (or
such other addresses specified by the Collateral Agent or the Tax Equity Investor in writing to
Owner).
10. Other than Tenant, there are no tenants or other third parties using or otherwise
occupying the Property, including, but not limited to, any third party mineral and water rights
holders.
11. There are no actions or proceedings, whether voluntary or involuntary, pending
against Owner in any State or Federal court (including any bankruptcy court, governmental
authority, or arbitration board or tribunal which could reasonably be expected to have a material
adverse effect on the ability of Owner to perform its obligations under the Lease), or any judgments
affecting Owner's title to the Property, and, to the knowledge of Owner, none have been
Exhibit D-5
threatened. As used herein, the term "pending" means actions or proceedings which have been
filed and actually served on Owner.
12. Owner has not received notice of any condemnation of or any other governmental
or judicial action against, or threat of condemnation of or any other governmental or judicial action
against, the Property, or a portion of the Property, that remains in effect or unresolved.
13. Owner is not aware of any event, act, circumstance, or condition constituting an Event
of Force Majeure or otherwise excusing the performance of any party under the Lease. No known
facts exist entitling Owner to any claim, counterclaim, offset, or defense against the Tenant in
respect of the Lease.
14. This Estoppel Certificate shall be binding upon Owner and its successors and
assigns.
15. This Estoppel Certificate may be executed with counterpart signature pages and in
duplicate originals, each of which shall be deemed an original, and all of which together shall
constitute a single instrument.
16. This Estoppel Certificate is made and delivered as of (the "Effective
Date"). This Estoppel Certificate may be relied upon by the Tenant, the Collateral Agent, the other
Secured Parties (as defined in the Financing Agreement), the Tax Equity Investor and the Title
Company, the successors and assigns of each of them and any future leasehold mortgagee of
Tenant.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
Exhibit D-6
IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, have
duly executed this Estoppel Certificate as of the day and year first above written.
OWNER:
By:
Name:
Title:
[Estoppel Signature Page]
Execution Version
EXHIBIT "A"
To Estoppel Certificate
[Lease Agreement and any amendments to be attached but not to be recorded]
Exhibit A to Estoppel Certificate
Execution Version
EXHIBIT `B"
To Estoppel Certificate
Description of Property
[LEGAL DESCRIPTION AND SURVEY DRAWING TO BE ATTACHED]
Exhibit B to Estoppel Certificate