HomeMy WebLinkAbout09813Amended 11/9/2020
ORDINANCE NO. 9813
AN ORDINANCE APPROVING A SOLAR ENERGY AND ENERGY
LEASE AGREEMENT BETWEEN THE CITY OF PUEBLO, A
COLORADO MUNICIPAL CORPORATION AND AURORA SOLAR
LLC, AN OREGON LIMITED LIABILITY COMPANY AWARDING
BID NO. 19-044 SOLAR PROJECT ON HONOR FARM
PROPERTY FOR PUEBLO, CO RELATING TO THE LEASE OF
LAND WITHIN THE CITY-OWNED HONOR FARM PROPERTY
FOR THE DEVELOPMENT OF SOLAR ELECTRICAL
GENERATION AND ENERGY STORAGE FACILITIES AND
AUTHORIZING THE MAYOR TO EXECUTE SAID AGREEMENT
WHEREAS, competitive bids for Bid No. 19-044 Solar Project on Honor Farm Property for
Pueblo, CO; and,
WHEREAS, the proposal of Aurora Solar LLC, an Oregon limited liability company was
the lowest of those bids determined to be responsible, and the Committee of Awards recommends
to the City Council that it authorize Bid No. 19-044 to be performed; NOW THEREFORE,
BE IT ORDAINED BY THE CITY COUNCIL OF PUEBLO, that:
SECTION 1.
The Solar Energy and Energy Lease Agreement (“Lease Agreement”) between the City
of Pueblo, a Colorado municipal corporation and Aurora Solar LLC, an Oregon Limited Liability
Company, dated November 9, 2020, a copy of which is attached hereto including all associated
documents, having been approved as to form by the City Attorney, is hereby approved. The Mayor
is authorized to execute and deliver said Lease Agreement in the name of the City and the City
Clerk is directed to affix the seal of the City thereto and attest same.
SECTION 2.
The officers and staff of the City are authorized and directed to perform any and all acts
consistent with the intent of the Ordinance and Agreement to implement the policies and
procedures described therein.
SECTION 3.
This Ordinance shall become effective immediately upon final passage and approval
Action by City Council:
Introduced and initial adoption of Ordinance by City Council on October 26, 2020 .
Final adoption of Ordinance by City Council on November 9, 2020 .
President of City Council
Action by the Mayor:
☒ Approved on November 11, 2020 .
☐ Disapproved on based on the following objections:
Mayor
Action by City Council After Disapproval by the Mayor:
☐ Council did not act to override the Mayor's veto.
☐ Ordinance re-adopted on a vote of , on
☐ Council action on __________________failed to override the Mayor’s veto.
President of City Council
ATTEST
City Clerk
Amended 11/9/2020
City Clerk’s Office Item # R-4
BACKGROUND PAPER FOR PROPOSED
ORDINANCE
COUNCIL MEETING DATE: October 26, 2020
TO: President Dennis E. Flores and Members of City Council
CC: Nicholas A. Gradisar, Mayor
VIA: Brenda Armijo, City Clerk
FROM: Scott Hobson, Acting Director of Planning and Community Development
SUBJECT: AN ORDINANCE APPROVING A SOLAR ENERGY AND ENERGY LEASE
AGREEMENT BETWEEN THE CITY OF PUEBLO, A COLORADO MUNICIPAL
CORPORATION AND AURORA SOLAR LLC, AN OREGON LIMITED LIABILITY
COMPANY AWARDING BID NO. 19-044 SOLAR PROJECT ON HONOR FARM
PROPERTY FOR PUEBLO, CO RELATING TO THE LEASE OF LAND WITHIN
THE CITY-OWNED HONOR FARM PROPERTY FOR THE DEVELOPMENT OF
SOLAR ELECTRICAL GENERATION AND ENERGY STORAGE FACILITIES
AND AUTHORIZING THE MAYOR TO EXECUTE SAID AGREEMENT
SUMMARY:
Attached is a proposed Ordinance approving and authorizing the Mayor to sign a Solar Energy
and Energy Lease Agreement (“Lease”) with Aurora Solar LLC, an Oregon Limited Liability
Company (“Aurora Solar”) awarding Bid No. 19-044 for the development and operation of solar
electrical generation and energy storage facilities on a maximum of 1,144 acres of the City’s
Honor Farm property.
PREVIOUS COUNCIL ACTION:
Not applicable to this Ordinance.
BACKGROUND:
On August 16, 2019, the City of Pueblo received proposals from three companies to potentially
develop and operate solar generation facilities on the City’s Honor Farm property. Aurora Solar’s
proposal submitted by Avangrid Renewables was selected as the most qualified and cost
beneficial submittal that was received by the City. Following the selection of Aurora Solar, a Solar
Energy and Energy Lease Agreement was prepared that provides for up to a five (5) year
Development Period for the securing of all required permissions and permits, and the construction
and installation of the solar facilities on up to a maximum of 1,144 acres of the 2,430 acres owned
by the City. Following the completion of the Development Period, Aurora Solar will be authorized
to operate the solar energy generation and solar energy storage facilities for a period of forty (40)
years.
In order for the Project to be implemented the conservation easement on the City’s property that
is held by the State of Colorado will need to be amended to allow for solar energy generation and
solar energy storage facilities to be located on the City property. Aurora Solar will be submitting
a request for the State of Colorado to approve an amendment to the conservation easement that
will allow for the development of the solar facilities. Without the amendment to the conservation
easement, the Project will not be authorized to be constructed and operated.
FINANCIAL IMPLICATIONS:
Under the attached Agreement, the City will lease to Aurora Solar up to 1,144 acres of the City’s
Honor Farm property for a forty (40) year period (“Operation Period”) following the completion of
the Development Period for the installation of the photovoltaic solar panels and solar energy
storage facilities. Commencing on the Effective Date of the Lease, Aurora Solar will pay the City
$34,320 annually during the Development Period of the Project. On each anniversary of the
Development Period, the Lease payment shall be increased by $3,000 dollars. Upon the initiation
of operations (“Operations Date”), Aurora Solar will pay the City an annual lease payment of $500
per acre of property utilized for the solar energy generation and the storage of solar energy. The
Operation Period payment will increase in an amount equal to two and one-quarter percent
(2.25%) from the previous twelve (12) months payment and continuing throughout the forty (40)
year Operation Period. Revenues from the lease will be deposited into the Honor Farm Enterprise
Account.
BOARD/COMMISSION RECOMMENDATION:
Not applicable.
STAKEHOLDER PROCESS:
The City staff has contacted Colorado Parks and Wildlife to notify them about a potential request
to amend the conservation easement held by the State of Colorado that currently does not allow
for solar energy generation and solar energy storage facilities to be located on the City property.
Aurora Solar will be submitting a request for the State of Colorado to approve an amendment to
the conservation easement that will allow for the development of the solar facilities.
ALTERNATIVES:
The Project will not move forward if the Agreement is not approved.
RECOMMENDATIONS:
Approve the Ordinance.
Attachments: Proposed Ordinance
Solar Energy and Energy Storage Lease Agreement and Attachments
SOLAR ENERGY
AND ENERGY STORAGE LEASE AGREEMENT
This SOLAR ENERGY AND ENERGY STORAGE LEASE AGREEMENT (this
"Agreement")is made, dated and effective as of the Effective Date (defined below),by and between
Landowner (defined below) and Aurora Solar LLC, an Oregon limited liability company
("Lessee").
1. Basic Provisions. The following terms used in this Agreement have the meanings
set forth below:
1.1 "Landowner" City of Pueblo, a Colorado Municipal Corporation
1.2 "Property" The real property consisting of approximately 1144 acres located in
Pueblo County, CO, which is described on the attached Exhibit A
and depicted on the attached Exhibit B, each incorporated herein by
this reference.
1.3 "Effective Date" g ,
1.4 "Development The period commencing upon the Effective Date and expiring on the
Period" earlier of(a)the fifth(5th) anniversary thereof or (b)the Operations
Date, unless earlier terminated pursuant to Section 12.1 below.
1.5 "Development Annual payments as set out below, payable as provided in
Period Payments" Section 5.1:
Development Period Year Amount
Year 1: $34, 320
Year 2: $37,320
Year 3: $40,320
Year 4: $43,320
Year 5: $46,320
1.6 "Operations Date" The date on which any Generation Facilities installed by Lessee on
the Property begin generating electrical energy or any Energy
Storage Facilities begin capturing and storing energy for use at a later
time.
1.7 "Extended Term" The forty (40)-year period commencing upon the earlier of the
Operations Date or the expiration of the Development Period, as
described in Section 4 below.
1.8 "Extended Term Annual rent in the amount of five hundred ($500) per acre of
Lease Rate" Property per year, increasing by 2.25% annually and payable as
described in Section 5.2 below.
1.9 "Improvements" All facilities, structures, equipment, machinery, materials and
property of every kind and character constructed, installed, and/or
placed on, above, or under the Property by or on behalf of Lessee in
connection with a Solar Project or Energy Storage.
1.10 "Interconnection Any and all Improvements the purpose of which is to transmit and
and Transmission deliver electrical power from Energy Storage Facilities or Generation
Facilities" Facilities located on the Property to a utility grid or other system,
including without limitation, transformers and electrical
transmission lines.
1.11 "Solar Project" Any Energy Facilities (as defined in Section 3.2.2 below), including
Generation Facilities and related Improvements and Interconnection
and Transmission Facilities, that are developed, constructed and
operated on the Property, or on other property, by or on behalf of
Lessee, as an integrated system to generate and deliver electrical
power to purchasers of such power.
1.12 "Solar Energy All facilities, structures, equipment, machinery, materials and
Facilities" property of every kind and character, including, without limitation,
Energy Storage Facilities, that are constructed, installed, and/or
placed on, above, or under the Property by or on behalf of Lessee in
connection with a Solar Project or Energy Storage. Solar Energy
Facilities include, but are not limited to, individual units or arrays of
solar energy collection cells, panels, mirrors, lenses and related
facilities (including battery and battery-like technology making up
Energy Storage Facilities) necessary to harness sunlight for
photovoltaic or solar thermal electric energy generation, including
without limitation, heating, and power generation systems installed
in connection with the foregoing solar energy facilities, existing
and/or future technologies used or useful in connection with the
generation of electricity from sunlight, and associated support
structures, interconnection facilities for delivery to a utility grid or
other system (including transformers and electrical transmission
lines), energy collection facilities, braces, wiring, plumbing, and
related equipment, as well as facilities for solar research and
development activities, including operations and maintenance
building(s), together with all related utilities supporting same.
1.13 "Solar Solar energy resource evaluation; solar research, solar energy
Operations" development; converting solar energy into thermal and/or electrical
energy; collecting and transmitting the thermal and/or electrical
energy converted from solar energy; storage and transmitting stored
energy; and any and all activities related to the foregoing.
1.14 "Energy Storage" The capture and storage of energy produced at one time for
utilization at a later time.
1.15 "Energy Storage Any method, equipment, facility, or Improvement used to capture
Facilities" and store energy from any source and convert it and dispatch it as
electrical power at a later time, including but not limited to battery,
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battery-like technology, or flywheel for storing any kind of energy
and providing regulation, frequency response, load following
capacity, or other storage benefit.
1.16 "Solar Energy All facilities, structures, equipment, machinery, materials and
Facilities" property of every kind and character, including, without limitation,
Energy Storage Facilities, that are constructed, installed, and/or
placed on, above, or under the Property by or on behalf of Lessee in
connection with a Solar Project or Energy Storage. Solar Energy
Facilities include, but are not limited to, individual units or arrays of
solar energy collection cells, panels, mirrors, lenses and related
facilities (including battery and battery-like technology making up
Energy Storage Facilities) necessary to harness sunlight for
photovoltaic or solar thermal electric energy generation, including
without limitation, heating, and power generation systems installed
in connection with the foregoing solar energy facilities, existing
and/or future technologies used or useful in connection with the
generation of electricity from sunlight, and associated support
structures, interconnection facilities for delivery to a utility grid or
other system (including transformers and electrical transmission
lines), energy collection facilities, braces, wiring, plumbing, and
related equipment, as well as facilities for solar research and
development activities, including operations and maintenance
building(s), together with all related utilities supporting same.
2. Lease and Confirmation; Location of Solar Energy Facilities; Separate Leases.
2.1. Lease and Confirmation. For good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged by Landowner, Landowner hereby leases the
Property to Lessee pursuant to the terms of this Agreement commencing as of the Effective Date.
2.2. Location of Solar Energy Facilities on the Property. If Lessee determines
in its sole discretion that any portion of the Property is not necessary or desirable for the proposed
construction and installation of Solar Energy Facilities, Lessee may, but shall not be obligated to,
unilaterally release any such portion of the Property from Lessee's leasehold interest under this
Agreement, while retaining Lessee's interest under this Agreement in the retained portion of the
Property. Lessee agrees that it shall determine and give notice to Landowner of the location of Solar
Energy Facilities and any substations or interconnection facilities to be located on the Property as
soon as reasonably practicable, and such location, together with all necessary and appropriate
setbacks, shall be deemed the "Property" thereafter. The parties hereby agree that Lessee may
unilaterally amend the Exhibit A to this Agreement as and if necessary, to modify the legal
description of the Property following such determination. Lessee shall, at its sole cost and expense,
with the cooperation of Landowner (which may include Landowner's notary-acknowledged
execution of such amendment), record with the Office of the County Clerk of Pueblo County a
mutually executed and acknowledged amendment to this Agreement and any memorandum of this
Agreement, reflecting the final legal description of the Property. The location, total acreage and
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legal description of the land constituting the Property are subject to adjustment in Lessee's sole
determination and discretion, or if and as required or desired by Pueblo County in order to obtain a
permit for the Solar Project
2.3. Division Into Separate Leases. Lessee may use the Property for a Solar
Project or Lessee may divide the Property between two or more separate Solar Projects. If Lessee
elects to so divide the Property into two or more Solar Projects, then Landowner shall, within thirty
(30) days after written request from Lessee, and without demanding any additional consideration,
bifurcate this Agreement by entering into and delivering to Lessee two or more stand-alone new
leases (which shall supersede and replace this Agreement) that provide Lessee with separate
leasehold estates in different portions of the Property,as designated by Lessee. Each new lease shall:
(a) specify the portion(s) of the Property to be covered thereby, (b) contain the same terms and
conditions as this Agreement, including the per acre Development Term Payments and Extended
Term Rent (except for any requirements that have been fulfilled by Lessee or any other person or
entity prior to the execution of such new lease, and except for any modifications that may be required
to ensure that each Party's combined obligations under such new leases do not exceed such Party's
obligations under this Agreement); (c) be for a term equal to the remaining term of this Agreement;
(d) contain a grant of access, transmission, communications and other easements for the benefit of
the bifurcated leasehold estates, covering such portion or portions of the Property as Lessee may
designate; and (e) enjoy the same priority as this Agreement over any lien, encumbrance or other
interest against the Property. Further,each new lease shall provide that default under such new lease
shall not cause across default of the other new lease.
3. Purposes of Lease; Permitted Uses.
3.1. Purpose of Lease for Solar Operations and Energy Storage. The lease
created by this Agreement is solely and exclusively for Solar Operations or Energy Storage, and
throughout the term of this Agreement, Lessee shall have the sole and exclusive right to use the
Property for Solar Operations and Energy Storage. Lessee shall have no right to use the Property
for agricultural or any other purposes.
3.1.1 Solar Energy Facilities Layout Plan. Prior to the commencement of
construction of the Solar Project, Lessee shall provide to Landowner a plan indicating the proposed
location of the Solar Energy Facilities ("Solar Energy Facilities Layout Plan"). Lessee shall
consult with Landowner and seek Landowner's input on Lessee's Solar Energy Facilities Layout
Plan prior to construction of any Solar Energy Facilities, showing Landowner the proposed location
of solar panels, roads, electric power lines and other improvements, before making Lessee's final
decisions as to location of Solar Energy Facilities on the Property. Lessee may, from time to time
upon written notice to Landowner and with Landowner's approval, which approval shall not be
unreasonably withheld, delayed or conditioned, make changes to the location of Solar Energy
Facilities from the location(s) shown on the then current Solar Energy Facilities Layout Plan, and
the Solar Energy Facilities Layout Plan shall be deemed to be modified to reflect such changes.
Lessee shall not be required to get written consent from Landowner if the location of any Solar
Energy Facilities is within five hundred feet of the original anticipated location of such Solar Energy
Facilities.
3.2. Permitted Uses of Property by Lessee for Solar Operations and Energy
Storage. The rights granted to Lessee in this Agreement with respect to Solar Operations and Energy
Storage permit Lessee, without limitation, to do the following:
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3.2.1. conduct studies and collect data relating to solar radiation, solar
energy, and other meteorological information;
3.2.2. construct, erect, install, reinstall, replace, relocate, and remove from
time to time the following, on the Property, on adjacent property or elsewhere: (a) Solar Energy
Facilities; (b) electrical wires and cables required for the gathering and transmission of electrical
energy and/or for communication purposes, which may be placed overhead on appurtenant support
structures or underground, and one or more substations or interconnection or switching facilities
from which Lessee may interconnect to a utility transmission system or the transmission system of
another purchaser of electrical energy, together with the appropriate rights-of-way on, along, in and
under the Property; (c) Energy Storage Facilities; (d) solar energy measurement equipment; (e)
maintenance yards, control buildings, control boxes and computer monitoring hardware; and(f) any
other improvements, including roads, fixtures, facilities, machinery and equipment useful or
appropriate to accomplish any of the foregoing (all of the foregoing, including the Solar Energy
Facilities, collectively, a"Solar Energy System");
3.2.3. excavate, grade, level and otherwise modify the land included within
the Property, with Landowner's approval, which shall not be unreasonably withheld, in connection
with Lessee's use of the Property for Solar Operations and Energy Storage;
3.2.4. use, maintain, monitor, and operate the Solar Energy Facilities and
Energy Storage Facilities on the Property; and
3.2.5. undertake any other lawful activities, whether accomplished by
Lessee or a third party authorized by Lessee, that Lessee determines are necessary, in connection
with or to accomplish any of the foregoing purposes.
3.3. Restricted Uses During Development Period. Notwithstanding anything
contained herein to the contrary, during the Development Period, Lessee's permitted activities shall
include the following: conducting studies of solar radiation, solar energy and other meteorological
data; extracting soil samples, performing geotechnical tests, conducting solar research and
development, and conducting such other tests, studies, inspections and analysis on the Property as
Lessee deems necessary,useful or appropriate,as well as constructing,erecting,installing,relocating
and removing from time to time meteorological equipment and other facilities for solar research and
development, together with rights of ingress and egress pursuant to Section 3.4.
3.4. Ingress and Egress. This Agreement includes the right of ingress of and
egress from (i) the Solar Energy System located on the Property over and across the Property by
means of any existing roads and lanes thereon, and by such other route or routes as Lessee may
construct on the Property from time to time, for the benefit of and for purposes incidental to Solar
Operations on the Property and Energy Storage on the Property.
3.5. Acknowledgments of Uses Related to Solar Operations and Energy
Storage. The parties acknowledge and agree that:
3.5.1. solar energy and Energy Storage technologies are improving at a rapid
rate and that it is likely that Lessee may (although Lessee shall not be required to) replace from time
to time existing Solar Energy Facilities on the Property with new model or design Solar Energy
Facilities that have increased energy capture and efficiency;
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3.5.2. the rights granted to Lessee in this Agreement include the right to
conduct any and all Solar Operations and Energy Storage on the Property, for the benefit of and for
purposes incidental to Solar Operations and Energy Storage, activities and projects on lands other
than the Property, including, the right to (i) install and maintain on the Property transmission lines
and facilities, both overhead and underground, which carry electricity to and/or from lands other
than the Property, and (ii) install and maintain on the Property communication lines and facilities,
both overhead and underground, which carry communications to and/or from lands other than the
Property.
3.6. Uses by Multiple Solar Projects. Lessee may use the Property for one Solar
Project, or Lessee may divide the Property into multiple Solar Projects, or Lessee may combine the
Solar Energy Facilities and Energy Storage Facilities located on the Property with Solar Energy
Facilities and Energy Storage Facilities located adjacent to or in the vicinity of the Property to form
a single Solar Project and Energy Storage project.
3.7. Survival of Covenants. Landowner acknowledges that the Solar Energy
Facilities and Energy Storage Facilities on the Property may be a portion of a larger solar energy
project and Energy Storage project. Landowner further acknowledges that the covenants,conditions,
rights and restrictions in favor of Lessee under this Agreement and Lessee's reliance on and benefit
from those covenants,conditions,rights and restrictions may be for the benefit of such larger project,
the Solar Energy Facilities or Energy Storage Facilities of which will from time to time share
structural and transmission components, ingress and egress, utility access, and other support, with
the Solar Energy Facilities or Energy Storage Facilities located on the Property; accordingly, the
covenants, conditions, rights and restrictions in favor of Lessee pursuant to this Agreement shall not
be deemed invalid or inoperative or otherwise be disregarded while any portion of the Solar Energy
Facilities or Energy Storage Facilities on the Property or an adjacent property are under
development, being replaced, or operational.
3.8. Grant of Solar Rights. Landowner hereby grants Lessee rights on,over, and
above the Property for the free passage of solar radiation to the Solar Energy Facilities. Any
obstruction to the passage of direct solar radiation across the Property to the Solar Energy Facilities
by Landowner or persons other than Lessee or a Tenant or Assignee (as defined in Section 10.1
below) or persons claiming through or under Lessee or a Tenant or Assignee is prohibited. Lessee
shall have the right to remove trees, structures and improvements on the Property which adversely
impacts the Solar Operations. Landowner may not, in connection with Landowner's use of the
Remaining Property or operation of its business,place structures or improvements on the Remaining
Property that may impede or interfere with the passage of direct solar radiation to the Solar Energy
Facilities. Landowner will not consent to any proposed variance, amendment or other modification
of applicable local or state law that would adversely impact the rights granted to Lessee in this
Section 3.8.
4. Development Period; Extended Term; Renewal Terms. Lessee's rights under this
Agreement shall continue initially throughout the Development Period. If, during the Development
Period, the Operations Date occurs, then this Agreement shall be extended automatically for the
Extended Term,commencing on such Operations Date. If the Operations Date does not occur within
the Development Period, then upon the expiration of the Development Period, the Extended Term
of forty (40)-years will commence automatically. During the Extended Term,Lessee and any Tenant
or Assignee(as defined in Section 10.1 below)may,by notice to Landowner no later than thirty(30)
days prior to the expiration of the Extended Term, elect to extend this Agreement for an additional
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ten-year period commencing upon the expiration of the Extended Term (the"Renewal Term"). With
respect to an extension of the term of the Agreement, at Lessee's election and discretion, Landowner
and Lessee shall execute in recordable form, and Lessee will then record,a memorandum evidencing
the extension, satisfactory in form and substance to Lessee.
5. Payments. Lessee will pay Landowner the following amounts:
5.1. Development Period Payments. In order to keep this Agreement in effect
during the Development Period, Lessee shall pay Development Period Payments to Landowner as
follows:
5.1.1. Within ninety(90)days of the start of the Development Period,Lessee
shall pay Landowner the Development Period Payment for the first twelve (12) consecutive months
of the Development Period.
5.1.2. For each subsequent year of the Development Period beginning on the
first anniversary of the start of the Development Period, Lessee shall pay Landowner the
Development Period Payment within forty-five (45) days of the anniversary of the start of the
Development Period.
5.1.3. Development Period Payments will automatically discontinue the
earlier of a) the date of the start of the Extended Term or b) any termination of this Agreement.
Development Period Payments for partial years or years in which the start of the Extended Term
occurs will be prorated or credited toward rent due for the first year of the Extended Term.
5.2 Rent Payments. Commencing on the first day of the Extended Term and on
the same day of each year thereafter during the term of this Agreement, Lessee shall pay the
Extended Term Payments set forth in Section 1.7 above to Landowner.
6. Ownership of Solar Energy Facilities. Landowner shall have no ownership or other
interest in any Solar Energy Facilities installed on the Property or any environmental attributes
produced therefrom, including without limitation any and all credits, benefits, emissions reductions,
offsets and allowances of any kind, howsoever entitled, attributable to the Solar Energy Facilities or
the electric energy, capacity or other generator-based products produced therefrom. The manner of
operation of the Solar Energy Facilities, including but not limited to decisions on when to conduct
maintenance, is within the sole discretion of Lessee.
7. Taxes. Lessee shall pay any increase in the real property taxes levied against the
Property directly attributable to the installation of Solar Energy Facilities on the Property, including
any reclassification of the Property as a result of the Solar Energy Facilities or this Agreement, to
the extent that such increase is not separately assessed to Lessee and paid directly by Lessee to the
taxing authorities. Lessee shall not be liable for taxes attributable to facilities installed by
Landowner or others on the Property, or to the underlying value of the Property itself. It is a
condition to Landowner's right to payment or reimbursement of any such increased taxes hereunder
that Landowner submit the real property tax bill to Lessee within ten (10) days after Landowner
receives the bill from the taxing authority. Lessee shall have the right to pay its portion of the real
property taxes directly to the taxing authority. Landowner shall pay its portion of the real property
taxes, and if Landowner fails to do so, Lessee shall be entitled(but not obligated)to make payments
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in fulfillment of Landowner's obligations to the taxing authority and may offset the amount of such
payments from amounts due Landowner under this Agreement.
8. Lessee's Representations, Warranties and Covenants. Lessee hereby represents,
warrants, covenants and acknowledges to Landowner as follows:
8.1. Location of Solar Energy Facilities; Site Plans. Notwithstanding any other
provision of this Agreement,Landowner expressly reserves the right to use the Property for all other
purposes to the extent such use by Landowner does not, currently or in the future, interfere with
Lessee's operations hereunder or enjoyment of the rights hereby granted; Lessee shall make
reasonable efforts not to disturb Landowner's activities on the Property. Lessee shall post the access
roads it constructs going to the Solar Energy Facilities as being private roads only for use by
Landowner, and by Lessee's authorized personnel in connection with the Solar Energy Facilities.
Landowner may use or cross such roads only to the extent that Landowner does not interfere with
Lessee's rights under this Agreement.
8.2. Insurance. Lessee shall, at its expense, maintain a commercial general
liability insurance policy insuring Lessee and Landowner against loss or liability caused by Lessee's
occupation and use of the Property under this Agreement, in an amount not less than Five Million
Dollars($5,000,000)of combined single limit liability coverage per occurrence,accident or incident,
which has a commercially reasonable deductible. Such insurance shall provide that such insurance
may not be canceled or terminated in any manner not less than ten (10) days' written notice to
Landowner. Certificates of such insurance evidencing the coverage required by this Agreement shall
be provided to Landowner at Landowner's reasonable request.
8.3. Indemnity. Lessee will indemnify Landowner against liability for physical
damage to property and for physical injuries or death to Landowner, The Property or the public, to
the extent caused by Lessee's (or any Assignees, Tenants, employees, agents or contractors of
Lessee) occupancy, operation or use of the Property, except to the extent such damages, injuries or
death are caused by the negligence or willful misconduct of Landowner or Landowner's agents or
invitees. The reference to property damage in the preceding sentence does not include any damages
to crops, or any losses of rent, business opportunities, profits and the like that result from
Landowner's loss of use of any portions of the Property occupied by, or otherwise attributable to the
installation of, Solar Energy Facilities pursuant to this Agreement. Lessee shall, at Lessee's sole
expense, take reasonable safety and security measures to reduce the risk of damage to the Solar
Energy Facilities or the risk that the Solar Energy Facilities will cause damage, injury or death to
people, livestock, other animals and property, including without limitation, fencing around the
perimeter of the Solar Energy Facilities as Lessee may deem necessary or appropriate to secure or
enclose the same, without burdening Landowner's use of the Remaining Property.
8.4. Requirement of Governmental Agencies. Lessee, at its expense, shall
comply in all material respects with valid laws, ordinances, statutes, orders and regulations of any
governmental agency applicable to the Solar Energy Facilities. In its sole discretion and through
appropriate legal proceedings brought in the name of Lessee or in the names of both Lessee and
Landowner where appropriate or required, Lessee shall have the right to contest the validity or
applicability to the Property or Solar Energy Facilities of any law, ordinance, statute, order,
regulation, property assessment or the like now or hereafter made or issued by any federal, state,
county,local or other governmental agency or entity. Landowner shall cooperate in every reasonable
way in such contest, provided Lessee reimburses Landowner for its reasonable and actual out-of-
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pocket expense incurred in connection with such cooperation. Any such contest or proceeding,
including any maintained in the name of Landowner, shall be controlled and directed by Lessee, but
Lessee shall observe and comply during the contest with the contested law, ordinance, statute,order,
regulation or property assessment.
8.5. Construction Liens. Lessee shall keep the Property free and clear of all liens
and claims of liens for labor and services performed on, and materials, supplies or equipment
furnished to, the Property in connection with Lessee's use of the Property pursuant to this
Agreement; provided, however, that if Lessee wishes to contest any such lien, Lessee shall, within
sixty (60) days after it receives notice of the filing of such lien, remove or bond around such lien
pursuant to applicable law.
8.6. Crop Damage.
(a) During initial construction, Lessee shall pay Landowner crop damage on a per
acre basis (prorated for fractional portions), for any and all portions of the Property that are taken
out of commercial crop production during the construction of the Solar Facilities and any and all
crops that are removed or damaged as a direct result of Lessee's construction and operation of Solar
Facilities on the Property. Portions of the Property shall be deemed to have been taken out of
commercial crop production only to the extent Lessee's construction of Solar facilities on the
Property materially interferes with Landowner's ability to farm such portions of the Property in
which such construction occurs,assuming that Landowner was actually farming such portions of the
Property immediately prior to Lessee's commencing construction of the Solar Facilities on the
Property. Such crop damage shall be paid one time per growing season in which such construction
and crop damage occur.
Crop damage will equal "Amount of damaged acres"multiplied by "Average yield in the County of
Property"multiplied by "Price".
"Amount of damaged acres" shall be based on Landowner's reasonable estimate as reasonably
reviewed and agreed by Lessee's representative.
"Average yield in the County of Property" shall be based on the average yield for the latest three
(3) years of corn in the County as published by the National Agricultural Statistical Service
through the website (www.nass.usda.gov), or if unavailable, another publicly available information
source of average yields in the County.
"Price", regardless of the actual type of crop, shall be based on the Corn future price for December
delivery during the year that crop damages occur, and will be the closing price of that year's
December futures quoted on the 15th of the month in which damages occur as posted by Chicago
Board of Trade, or if unavailable another publicly available information source.
(b) After initial construction is complete, Lessee shall be responsible to pay Landowner any losses
of income,rent,business opportunities,profits or other losses arising out of the damage by the Lessee
of any crops growing on the Property as a result of the existence or operations of the Solar Facilities
to the extent, but only to the extent that such damage occurs outside the boundaries of the access
roads and Solar Facilities installed on the Property pursuant to this Agreement or otherwise outside
the graveled area surrounding the base of any Solar Facilities installed on the Property. It being the
intention of the parties that compensation under Section 1.6 includes a payment for crop damage
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incidental to such existence and operation. Such crop damage, if any, occurring after construction
is complete, will equal:
"Amount of damaged acres"multiplied by "Average yield in the County of Property"multiplied by
"Price".
"Amount of damaged acres" shall be based on Landowner's reasonable estimate as reasonably
reviewed and agreed by Lessee's representative.
"Average yield in the County of Property" shall be based on the average yield for the latest three
(3) years of corn in the County as published by the National Agricultural Statistical Service
through the website (www.nass.usda.gov), or if unavailable, another publicly available information
source of average yields in the County.
"Price",regardless of the type of crop, shall be based on the corn future price for December delivery
during the year that crop damages occur,and will be the closing price of that year's December futures
quoted on the 15th of the month in which damages occur as posted by Chicago Board of Trade, or if
unavailable another publicly available information source. In the event that,after initial construction
is complete, a crop type different from corn, becomes the prevalent crop type in the County of the
Property, then the"Price" shall be the future price for that new prevalent type of crop for December
delivery during the year that crop damages occur, and will be the closing price of that year's
December futures quoted on the 15th of the month in which damages occur as posted by Chicago
Board of Trade, or if unavailable another publicly available information source.
To the extent that Landowner demonstrates crop damages for a specialty crop (i.e., a crop not
normally grown within the county) that the Landowner has planted and which was damaged during
the operation of the Solar Facilities, the parties agree that the crop damage calculation shall remain
the same as identified, except that (i) the "Average Yield in the County of the Property" shall be
based on the actual yield for the specialty crop on the Property and(ii)the"Price"shall be the market
price, or if unavailable actual receipts from Landowner's sale of such specialty crop.
8.7. Hazardous Materials and Landfill. Lessee shall not violate, and shall
indemnify Landowner against, any violation by Lessee or Lessee's agents or contractors of any
federal, state or local law, ordinance or regulation relating to the generation, manufacture,
production,use,storage,release or threatened release,discharge,disposal,transportation or presence
of any substance, material or waste which is now or hereafter classified as hazardous or toxic, or
which is regulated under current or future federal, state or local laws or regulations, on or under the
Property.
If any part of the Property includes any portion of a landfill, Lessee shall not, in any way, disturb
such landfill without the prior written consent of Landowner and any governmental agency which
Landowner may require including, but not limited to, the designated state regulatory body.
8.8. Compliance With Law. Lessee shall, at Lessee's expense, at all times
promptly observe and comply with all present and future laws, orders, regulations, rules, ordinances
and requirements of federal, state, county and city governments with respect to the use, care and
control of the Property.
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8.9. Representations. Lessee acknowledges that this Agreement is accepted and
executed on the basis of Lessee's own examination and personal knowledge of the value and
condition of the Property; that no representation as to the value, condition or repair of the Property
has been made by Landowner or any agent of Landowner;and that Lessee agrees to take the Property
in the condition the Property is in at the date of the execution of this Agreement.
8.10. Repair and Maintenance. Lessee shall, at Lessee's expense, maintain the
Property in good order and condition during the term of this Agreement.
8.10.1. Lessee shall make commercially reasonable efforts to preserve top soil
during construction and Landowner acknowledges that Lessee may use any soil other than_topsoil
as part of the general construction process, provided that such use is on the property of Landowner.
If any excess soil is available after construction on Landowner's land, Lessee shall offer such soil to
Landowner for Landowner's use and Landowner may move such soil at Landowner's sole cost. If
Landowner does not elect to take the soil, Lessee shall be responsible for such soil's removal, at
Lessee's expense.
8.10.2. Lessee shall make commercially reasonable repair, (including
replacement of damaged tile as necessary),of any tile damage that Lessee's construction or operation
activities cause on The Property, and Lessee will pay crop damage for any crops damaged by flood
due to broken tile attributable to Lessee's activities on the property. Underground electrical wires
and cables shall be installed with a trencher, and to a depth not less than 42 inches below the surface
of the ground. All farm drainage tile which intersects the Lessee's underground electrical wires and
cable shall be identified and repaired and/or replaced if damaged by a contractor, qualified in farm
drainage. Lessee agrees to consult, in good faith, with Landowner regarding the repair and/or
replacement of said drainage tile. Landowner shall have the right to inspect all tile repairs and
connections prior to backfill, provided Landowner is immediately available to do so. If Landowner
is not available, Lessee's contractor shall provide Landowner with digital photographs of the repair.
Upon completion of the construction project, Lessee shall provide Landowner with i) a GPS
coordinate reading of the location of such repaired or replaced tile and ii) an illustration depicting
the location of all underground electrical wires and cables, on the property of Landowner, as well as
the intersection of all such underground improvements with the drainage tile system on the Property.
In the event that Landowners' activities on the property subsequent to installation of the Solar
Facilities shall require a physical locate as to said wires and cables, Lessee agrees to do so, at no
expense to Landowner, within five (5) days of receiving the locate request.
8.10.3. Lessee shall undertake commercially reasonable efforts to control
weed outgrowth on the Property during the term of this agreement.
8.11. Return of Property. Upon the expiration of this Agreement or its
termination for any cause,Lessee shall return the Property in good order and condition. Specifically,
Lessee shall, prior to the date of the expiration or termination of this Agreement, remove all above
ground improvements of Lessee down to a depth of three feet, except such improvements as roads
or similar ground improvements as designated by Landowner. Lessee shall comply with appropriate
local or state regulations relative to provision of any surety or guaranty of this obligation.
9. Landowner's Representations, Warranties and Covenants. Landowner hereby
represents, warrants and covenants to Lessee as follows:
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9.1. Landowner's Authority. Landowner has sole and exclusive possession of
the Property and has the unrestricted right and authority to execute this Agreement and to grant to
Lessee the rights granted hereunder. No rights to convert the solar resources of the Property or to
otherwise use the Property for solar energy conversion purposes have been granted to or are held by
any party other than Lessee. Each person signing this Agreement on behalf of Landowner is
authorized to do so. When signed by Landowner, this Agreement constitutes a valid and binding
agreement enforceable against Landowner in accordance with its terms.
9.2. No Interference. Any grant of rights Landowner hereafter makes to any
person or entity, whether located on the Property or elsewhere, shall not, in the future, impede or
interfere with: (i) the siting, permitting, construction, installation, maintenance, operation,
replacement, or removal of Solar Energy Facilities, located on the Property; (ii) access over the
Property to Solar Energy Facilities; (iii) the undertaking of any other activities of Lessee permitted
under this Agreement; (iv) the availability, accessibility, or non-obstructed passage of direct solar
radiation across the Property; or (v) the transmission of electric, electromagnetic or other forms of
energy to or from the Property. In no event during the term of this Agreement shall Landowner
construct,build or locate or allow others to construct, build or locate any Solar Energy System, Solar
Energy Facilities or similar project on the Property.
9.3. Water for Solar Energy Facilities; Cooperation and Reimbursement of
Costs. During the term of this Agreement, Landowner shall make available to Lessee, to the extent
available to Landowner in excess of Landowner's own needs and to the extent allowed under
applicable law and permits, water in such quantities as may be needed and available for Lessee's
Development Period operations as set forth in Section 3.3, and for sanitary and drinking purposes,
as well as operational purposes during the Extended Term,First Renewal Term and Second Renewal
Term. Landowner shall cooperate with Lessee to study the availability of water on or to the Property
and to obtain water rights or a contract for the delivery of water to the Property for use by Lessee in
its Solar Operations. Lessee shall reimburse Landowner for its reasonable and actual administrative,
operation and utility costs, and all expenses directly and indirectly incurred by Landowner in
satisfaction of this Section 9.3.
9.4. Title Review and Cooperation. Landowner shall cooperate with Lessee to
obtain nondisturbance, subordination and other title curative agreements from any person with a
current lien, encumbrance,mortgage, lease or other exception to Landowner's fee or leasehold titles
to the Property to the extent necessary to eliminate any actual or potential interference by any such
person with any rights granted to Lessee under this Agreement. If Lessee and Landowner are unable
to obtain such agreements from any third party holding an interest in the Property,Lessee,in addition
to any other rights provided for herein, shall be entitled (but not obligated) to make payments in
fulfillment of Landowner's obligations to such third party and may offset the amount of such
payments from amounts due Landowner under this Agreement. Landowner shall execute any
estoppel certificates that may be reasonably necessary for recording purposes or otherwise
reasonably requested by Lessee.
9.5. Requirements of Governmental Agencies. Landowner shall assist and fully
cooperate with Lessee in complying with or obtaining any land use permits and approvals, tax-
incentive or tax-abatement program approvals, building permits, environmental impact reviews or
any other approvals required or deemed desirable by Lessee in connection with the development,
financing, construction, installation, replacement, relocation, maintenance, operation or removal of
Solar Energy Facilities, including execution of applications for such approvals and delivery of
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information and documentation related thereto, and execution, if required, of any orders or
conditions of approval. Lessee shall reimburse Landowner for its reasonable and actual out-of-
pocket expense directly incurred in connection with such cooperation, to the extent Lessee has
approved such expenses in advance. Landowner shall make available to Lessee copies of all field
tiling surveys,environmental,geotechnical and other site assessments, surveys,plans and other such
records of Landowner to the extent such information relates directly to the proposed Solar Energy
Facilities.
9.6. Indemnity. Landowner will defend,indemnify and hold harmless Lessee for,
from and against liability for physical damage to property (including, without limitation, Lessee's
roads) and for physical injuries or death to Lessee or its tenants, invitees, contractors or the public,
to the extent caused by the negligence or willful misconduct of Landowner or its agents, employees
or contractors.
9.7. Hazardous Materials. Landowner shall not violate, and shall indemnify
Lessee for, from and against any violation (past, present or future) by Landowner or Landowner's
agents or contractors of, any federal, state or local law, ordinance or regulation relating to the
generation,manufacture, production,use, storage, release or threatened release, discharge, disposal,
transportation or presence of any substance, material or waste that is now or hereafter classified as
hazardous or toxic, or which is regulated under current or future federal, state or local laws or
regulations, on or under the Property.
9.8. Quiet Enjoyment. Landowner covenants and warrants that Lessee shall
peacefully hold and enjoy all of the rights granted by this Agreement for its entire term without
hindrance or interruption by Landowner or any person lawfully or equitably claiming by, through,
under or superior to Landowner subject to the terms of this Agreement.
10. Assignment; Subleases; Cure.
10.1. Assignees and Tenants. Lessee and any Assignee (as defined below) shall
have the right, without need for Landowner's consent, to do any of the following, conditionally or
unconditionally, with respect to all or any portion of the Property: finance Solar Energy Facilities;
grant co-leases, separate leases, subleases, easements, licenses or similar rights (however
denominated)to one or more Assignees or Tenants (as defined below); or sell, convey, lease, assign,
mortgage, encumber or transfer to one or more Assignees or Tenants this Agreement, or any right
or interest in this Agreement, or any or all right or interest of Lessee in the Property or in any or all
of the Solar Energy Facilities that Lessee or any other party may now or hereafter install on the
Property. An"Assignee" is any of the following: (i) any one or more parties involved in financing
or refinancing of any Solar Energy Facilities, including, without limitation, any lender to or investor
in Lessee or in any Solar Energy Facilities; (ii) any purchaser or lessee of any of the Solar Energy
Facilities, or any purchaser of all of substantially all of the membership interests in Lessee or of all
or any portion of Lessee's interest in this Agreement; (iii) a corporation, limited liability company,
partnership or other entity now existing or hereafter organized in which Lessee,or any affiliate,owns
(directly or indirectly) at least fifty-one percent (51%) of all outstanding shares of voting stock or
ownership interests;(iv)a partnership now existing or hereafter organized,a general partner of which
is such a corporation or limited liability company; or (v) a corporation, limited liability company,
partnership or other entity that acquires all or substantially all of Lessee's or Lessee's business,assets
or capital stock, directly or indirectly, by purchase, merger, consolidation or other means. A
"Tenant" is any person who succeeds to the leasehold interest of Lessee as an Assignee or to whom
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a sublease is conveyed by Lessee or an Assignee. Lessee or an Assignee that has assigned an interest
under this Section, or that has conveyed a sublease, will give notice of such assignment or sublease
(including the address of the assignee or sublease thereof for notice purposes) to Landowner,
provided that failure to give such notice shall not constitute a default under this Agreement but rather
shall only have the effect of not binding Landowner with respect to such assignment or sublease
until such notice shall have been given.
10.2. Assignee/Tenant Obligations. No Assignee or Tenant that does not directly
hold an interest in this Agreement, and no Assignee or Tenant that holds an interest in or lien on or
security interest in this Agreement for security purposes, shall have any obligation or liability under
this Agreement prior to the time that such Assignee or Tenant directly holds an interest in this
Agreement or, in the case of an interest, lien or security interest for security purposes, the holder
thereof succeeds to absolute title to such interest, in this Agreement. Any such Assignee or Tenant
shall be liable to perform obligations under this Agreement only for and during the period such
Assignee or Tenant directly holds such interest or absolute title.Any assignment permitted hereunder
shall release the assignor from obligations accruing after the date that liability is assumed by the
Assignee or Tenant.
10.3. Right to Cure Defaults/Notice of Defaults/Right to New Lease. To prevent
termination of this Agreement or any partial interest therein, Lessee, or any Assignee or Tenant,
shall have the right, but not the obligation, at any time prior to the termination, to pay any or all
amounts due hereunder, and to do any other act or thing required of any Assignee, Tenant or Lessee
hereunder or necessary to cure any default and to prevent the termination of this Agreement. As a
precondition to exercising any rights or remedies as a result of any alleged default by Lessee, an
Assignee or a Tenant, Landowner shall give written notice of the default to each Assignee and each
Tenant, concurrently with delivery of such notice to Lessee, specifying in detail the alleged event of
default and the required remedy. Each such Assignee and each such Tenant shall have the same
amount of time to cure said default as is given to Lessee pursuant to this Agreement, which cure
period for each Assignee and each Tenant shall commence to run with the end of the cure period
given to Lessee in this Agreement. If Lessee or an Assignee or Tenant holds an interest in less than
all the rights and interests under this Agreement, the Property or the Solar Energy Facilities, any
default under this Agreement shall be deemed remedied, as Lessee's or such Assignee's or Tenant's
partial interest, and Landowner shall not disturb such partial interest, if Lessee or the Assignee or
Tenant, as the case may be, shall have cured its pro rata portion of the default by paying the fees
attributable to the Solar Energy Facilities in which Lessee or the Assignee or Tenant, as the case
may be,holds an interest. In the event of an uncured default by Lessee,or by an Assignee of Lessee's
entire interest in this Agreement, or in the event of a termination of this Agreement by agreement,
by operation of law or otherwise, each Assignee of a partial interest in this Agreement, and each
Tenant who is a sublessee of Lessee or of an Assignee of Lessee, shall have the right to demand, and
the Landowner shall grant and enter into, a new lease, substantially identical to this Agreement, by
which such Assignee of a partial interest in the rights and interests under this Agreement, or such
Tenant by a sublease, shall be entitled to, and Landowner shall not disturb, the continued use and
enjoyment by such Tenant or Assignee of the Property, or portion of the Property, for the full term
of this Agreement, as set forth in Section 4 of this Agreement, or such shorter term as said Assignee
or Tenant may otherwise be entitled pursuant to its assignment or sublease. Further, in the event of
an uncured default by Lessee or by an Assignee of Lessee's entire interest in this Agreement, or in
the event of a termination of this Agreement by agreement, by operation of law or otherwise,
Landowner hereby agrees that, if and for so long as (i) a Tenant who is a sublessee of Lessee or of
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an Assignee is not in default under the sublease (beyond any period given Lessee, an Assignee or a
Tenant under this Agreement to cure such default), (ii) such Tenant attorns to the Landowner, and
(iii)the terms and conditions of the Tenant's sublease do not contravene the terms and conditions of
this Agreement, Landowner shall (a) recognize such sublease, (b) not diminish nor interfere with
such Tenant's possession of the portion of the Property covered by the sublease or with any term
extension or renewal rights in the sublease, and (c) not disturb such Tenant's occupancy of such
portion of the Property for the full term of this Agreement or such shorter term to which such Tenant
may be entitled under the sublease. A Tenant that is, or in the future becomes, a sublessee of Lessee,
or a sublessee of an Assignee, is an intended third-party beneficiary of the provisions of this Section
10.3 and entitled to enforce this provision.
10.4. Acquisition of Interest. Except as otherwise provided in Section 10.1 above,
the acquisition of all or any portion of Lessee's or an Assignee's or Tenant's interest in the Property
or the Solar Energy Facilities or this Agreement by another Assignee or Tenant or any other person
through foreclosure or other judicial or nonjudicial proceedings in the nature thereof or any
conveyance in lieu thereof, shall not require the consent of Landowner or constitute a breach of any
provision or a default under this Agreement, and upon such acquisition or conveyance Landowner
shall recognize the Assignee or Tenant, or such other party, as Lessee's or such other Assignee's or
Tenant's proper successor.
10.5. New Lease. If this Agreement is rejected by a trustee or debtor-in-possession
in any bankruptcy or insolvency proceeding or this Agreement is terminated as result of any
incurable default, and within sixty (60) days after such rejection or termination Lessee or any
Assignee or Tenant shall have arranged to the reasonable satisfaction of Landowner for the payment
of all fees or other charges due and payable by Lessee or other Assignees or Tenants as of the date
of such rejection or termination, then Landowner shall execute and deliver to Lessee or such
Assignee or Tenant, as the case may be, a new lease to the Property which (i) shall be for a term
equal to the remainder of the term of this Agreement before giving effect to such rejection or
termination, (ii) shall contain the same covenants, agreements, terms, provisions and limitations as
this Agreement (except for any requirements that have been fulfilled by Lessee or any Assignee or
Tenant prior to rejection or termination of this Agreement), and(iii) shall include that portion of the
Property improved with Solar Energy Facilities in which Lessee or such other Assignee or Tenant
had an interest on the date of rejection or termination.
10.6. Extended Cure Period. If any default by Lessee or an Assignee or Tenant
under this Agreement cannot be cured without obtaining possession of all or part of the Property
and/or all or part of the Solar Energy Facilities and/or all or part of Lessee's or another Assignee's
or Tenant's interest in this Agreement, then any such default shall be deemed remedied if(i) within
sixty (60) days after receiving notice from Landowner as set forth in Section 12.2 hereof, either
Lessee or an Assignee or Tenant shall have acquired possession of all or part of the Property and/or
all or part of the Solar Energy Facilities and/or all or part of such interest in this Agreement, or shall
have commenced appropriate judicial or nonjudicial proceedings to obtain the same; and (ii) Lessee
or the Assignee or Tenant, as the case may be, shall be in the process of diligently prosecuting any
such proceedings to completion;and(iii)after gaining possession of all or part of the Property and/or
all or part of the Solar Energy Facilities and/or all or part of such interest in this Agreement, Lessee
or the Assignee or Tenant performs all other obligations as and when the same are due in accordance
with the terms of this Agreement. If Lessee or an Assignee or Tenant is prohibited by any process
or injunction issued by any court or by reason of any action by any court having jurisdiction over
15
any bankruptcy or insolvency proceeding involving Lessee or any defaulting Assignee or Tenant, as
the case may be, from commencing or prosecuting the proceedings described above, the 60-day
period specified above for commencing such proceeding shall be extended for the period of such
prohibition.
10.7. Certificates, etc. Landowner shall execute such estoppel certificates
(certifying as to such matters as Lessee may reasonably request, including without limitation that no
default then exists under this Agreement, if such be the case) and/or consents to assignment and/or
nondisturbance agreements as Lessee or any Assignee or Tenant may reasonably request from time
to time. Landowner and Lessee shall cooperate in amending this Agreement from time to time to
include any provision that may be reasonably requested by Lessee, Landowner or any Assignee or
Tenant for the purpose of implementing the provisions contained in this Agreement or of preserving
an Assignee's security interest.
10.8. Landowner Transfers and Mortgages; Subdivision of Property.
10.8.1. Landowner Transfers and Mortgages. Landowner shall have the right
to transfer or convey Landowner's undivided interest in the Property to any person or entity (a
"Transferee") without Lessee's prior consent provided that there is a concurrent transfer and/or
assignment and assumption of Landowner's rights and obligations under this Agreement to the same
Transferee as part of the same transaction. Further, Landowner shall have the right to transfer
Landowner's undivided interest in a portion of the Property (a"Partial Transfer")to any person or
entity (a"Partial Transferee") provided that upon closing of each Partial Transfer, (a) each Partial
Transferee shall assume in a writing reasonably acceptable to Lessee all of the Landowner's then-
existing obligations under this Agreement to the extent same relate to the portion of the Property
being transferred,and(b) each of Landowner and any Partial Transferee must agree in writing to the
following: Following any Partial Transfer, Lessee will, on an annual basis:
• calculate the sum of all payments due under Section 5 above for the applicable year,
• divide such sum by the number of acres constituting the Property subject to this
Agreement (subject to any partial termination during the term of this Agreement), and
• pay each of Landowner and any Partial Transferee a pro rata amount based on the
acreage owned by each party.
For example purposes only, if(i) Landowner owns 100 acres and partially transfers 10 acres upon
which Energy Facilities are installed by Lessee; and(ii)annual payments due under Section 5 during
the year following such Partial Transfer total $100,000; then (iii) Lessee will pay the original
Landowner $90,000 and the Partial Transferee $10,000. Such allocation will be without respect to
any Energy Facilities or Improvements installed on any portion of the Property transferred or
retained by Landowner.
10.8.2. Subdivision of Property. Notwithstanding anything to the contrary in
Section 10.8.1 above, if any Partial Transfer results in a subdivision of the Property, Lessee shall
have the right to receive, review, and comment on any applications for any such subdivision before
the same are submitted to or filed with the applicable governmental body, and shall be entitled to
receive prior written notice from Landowner of any public proceeding related thereto. Any such
subdivision shall not violate any zoning and/or subdivided land ordinances and regulations
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(including but not limited to any setback requirements) applicable to all or any portion of any
Lessee's project located or to be located thereon.
10.8.3. No Severance or Assignment of Payment Rights. Landowner shall have
no right to sever its "solar rights", howsoever denominated, or any payments to be made to
Landowner pursuant to this Agreement, from Landowner's fee interest in the Property, by way of
assignment, conveyance or otherwise, without Lessee's prior written consent.
11. Lender Protection. Lessee and any Assignee or Tenant may,at any time and without
the consent of Landowner, grant to any person or entity (herein, together with that person's or
entity's successors and assigns, a"Lender") one or more mortgages, trust deeds or similar security
interests in all or any part of its interests under this Agreement (a "Mortgage"). In the event any
such Mortgage is granted,the Lender thereunder shall, for so long as its Mortgage remains in effect,
be entitled to the protections described in the following provisions of this Section 11, upon delivery
to Landowner of notice of its name and address.
11.1. Consent to Modification, Termination or Surrender. So long as any
Mortgage remains in effect, this Agreement shall not be modified, and Landowner shall not accept
a surrender of any of the Property or a termination or release of this Agreement prior to expiration
of all periods described in Section 4, without the prior written consent of all Lenders.
11.2. Notice of Default; Opportunity to Cure. As a precondition to exercising
any rights or remedies for any alleged default under this Agreement, Landowner shall give written
notice of the default to each Lender concurrently with delivery of such notice to Lessee, an Assignee
or a Tenant, as applicable, specifying in detail the alleged default and the required remedy. In the
event Landowner gives any such notice, the following provisions shall apply:
(a) The Lender shall have the same period after receipt of the
default notice as is given to Lessee, the Assignee or Tenant to remedy or cause to be remedied the
default plus, in each instance, (i) an additional thirty (30) days after receipt of the default notice in
the event of any monetary default(meaning any failure to pay when due any rent,real property taxes,
insurance premiums or other monetary obligation under this Agreement);and(ii)an additional thirty
(30) days after receipt of the default notice in the event of any other type of default, provided that
such 30-day period shall be extended for the time reasonably required to complete such cure,
including the time required for the Lender to perfect its right to cure such default by obtaining
possession of the Property (including possession by a receiver) or by instituting foreclosure
proceedings, provided the Lender acts with reasonable and continuous diligence. Lenders shall have
the absolute right to do any act or thing required to be performed by Lessee, an Assignee or any
Tenant under this Agreement, and any such act or thing performed by a Lender shall be as effective
to prevent a default under this Agreement and/or a forfeiture of any rights under this Agreement as
if done by Lessee, the Assignee or Tenant itself.
(b) During any period of possession of the Property by a Lender
(or a receiver requested by such Lender) and/or during the pendency of any foreclosure proceedings
instituted by a Lender, the Lender shall pay or cause to be paid the rent and all other monetary
charges payable by Lessee, an Assignee or any Tenant which have accrued and are unpaid at the
commencement of such period and those which accrue thereafter during such period. Following
acquisition of Lessee's, an Assignee or any Tenant's leasehold estate by the Lender or its assignee
or designee as a result of foreclosure or assignment in lieu of foreclosure, or by a purchaser at a
17
foreclosure sale, this Agreement shall continue in full force and effect and the Lender or other party
acquiring title to the leasehold estate shall, as promptly as reasonably possible, commence the cure
of all other defaults hereunder and thereafter diligently process such cure to completion, whereupon
Landowner's right to terminate this Agreement based upon such defaults shall be deemed waived;
provided, however, the Lender or other party acquiring title to the leasehold estate shall not be
required to cure those defaults which are not reasonably susceptible of being cured or performed by
such party ("Non-Curable Defaults"). Non-curable defaults shall be deemed waived by Landowner
upon completion of foreclosure proceedings or acquisition of Lessee's, Assignee's or Tenant's
interest in this Agreement by such party.
(c) Upon the sale or other transfer of the leasehold interests and
obligations acquired pursuant to foreclosure or assignment in lieu of foreclosure,the Lender or other
acquiring party shall have no further duties or obligations hereunder.
(d) Neither the bankruptcy nor the insolvency of Lessee, an
Assignee or any Tenant shall be grounds for terminating this Agreement as long as the rent and all
other monetary charges payable by such Lessee, Assignee or Tenant hereunder are paid by the
Lender in accordance with the terms of this Agreement.
(e) Nothing herein shall be construed to extend this Agreement
beyond periods contemplated in Section 4 or to require a Lender to continue foreclosure proceedings
after the default has been cured. If the default is cured and the Lender discontinues foreclosure
proceedings, this Agreement shall continue in full force and effect.
11.3. New Lease to Lender. If this Agreement terminates as a result of any default,
foreclosure or assignment in lieu of foreclosure, or bankruptcy, insolvency or appointment of a
receiver in bankruptcy, Landowner shall give prompt written notice to the Lenders. Landowner
shall, upon written request of the first priority Lender that is made within ninety (90) days after
notice to such Lender,enter into a new lease of the Property with such Lender,or its designee,within
thirty (30) days after the receipt of such request. Such new lease shall be effective as of the date of
the termination of this Agreement, shall be upon the same terms, covenants, conditions and
agreements as contained in this Agreement,and shall be subject to all existing subleases entered into
pursuant to this Agreement,provided that the subtenants are not then in default. Upon the execution
of any such new lease, the Lender shall (i) pay Landowner any amounts which are due Landowner
from Lessee, the Assignee or Tenant, (ii) pay Landowner any and all amounts which would have
been due under this Agreement (had this Agreement not been terminated) from the date of
termination to the date of the new lease, (iii) perform all other obligations of Lessee and/or the
Assignee or Tenant under the terms of this Agreement, to the extent performance is then due and
susceptible of being cured and performed by the Lender; and (iv) agree in writing to perform, or
cause to be performed, all non-monetary obligations which have not been performed by Lessee, the
Assignee or Tenant that would have accrued under this Agreement up to the date of commencement
of the new lease, except those obligations which constitute Non-Curable Defaults. Any new lease
granted to the Lender shall enjoy the same priority as this Agreement over any lien, encumbrance or
other interest created by Landowner. The provisions of this Section 11 shall survive termination of
this Agreement and shall continue in effect thereafter and, from the effective date of termination to
the date of execution and delivery of such new lease, such Lender may use and enjoy said Property
without hindrance by Landowner or any person claiming by,through or under Landowner, provided
that all of the conditions for a new lease as set forth in this Section are complied with.
18
11.4. Subleases. During any periods following termination of this Agreement
thereafter in which any Lender is entitled to enter into a new lease of the Property pursuant to Section
11.3,Landowner will not terminate any sublease or the rights of any sublessee thereunder unless the
sublessee is in default under such sublease. During such period, if the Landowner receives any rent
and other payments due from sublessees,including any sublessees whose attornment Landowner has
agreed to accept, Landowner will do so as agent of such Lender and shall deposit such rents and
payments in a separate and segregated account in trust subject to a right of setoff against amounts
due to Landowner. Upon the execution and delivery of a new lease with Lender, Landowner shall
account to its counterparty under such new lease for the rent and other payments made under such
subleases, and the counter-party shall then assign the rent and other payments due under such
subleases to any Lenders under this Agreement. The collection of rent by Landowner acting as an
agent pursuant to this Section 11.4 shall not be deemed an acceptance by Landowner for its own
account of the attornment of any sublessee unless Landowner shall have agreed in writing with such
sublessee that its subtenancy shall be continued following the expiration of any period during which
a Lender may be granted a new lease, in which case such attornment shall take place upon the
expiration of such period but not before. Landowner shall not be under any obligation to enforce any
subleases.
11.5. No Waiver. No payment made to Landowner by any Lender shall constitute
an agreement that such payment was, in fact, due under the terms of this Agreement or a waiver of
the Lender's rights with respect to any wrongful, improper or mistaken notice or demand with
respect to such payment.
11.6. No Merger. There shall be no merger of this Agreement, or of the leasehold
estate or other interests created by this Agreement, with the fee estate in the Property by reason of
the fact that this Agreement or any such interests may be held, directly or indirectly, by or for the
account of any person or persons who shall own the fee estate or any interest therein, and no such
merger shall occur unless and until all persons at the time having an interest in the fee estate in the
Property, and all persons (including Lenders) having an interest in or under this Agreement and any
portion of the fee estate shall join in a written instrument effecting such merger and shall duly record
the same.
11.7. Further Amendments. Upon request, Landowner shall (1) amend this
Agreement to include any provision reasonably requested by a proposed Lender, provided such
amendment does not materially impair Landowner's rights or substantially increase the burdens or
obligations of Landowner under this Agreement, and (2) execute such estoppel certificates
(certifying as to such matters as Lender may reasonably request, including, without limitation, that
no default then exists under this Agreement, if such be the case) and other additional instruments
reasonably requested by any Lender to evidence the status of this Agreement and Lender's rights
under this Agreement.
11.8. Taking for Public Use. If the Property, in whole or in part, is taken or
condemned for public use(an agreed sale to a public or quasi-public corporation or utility after threat
of condemnation constitutes a taking for public use), all compensation awarded upon such
condemnation or taking for the Property or any improvements of Landowner on the Property shall
be paid directly to Landowner and all compensation relating to the Solar Operations shall be paid
directly to Lessee. Upon any such taking by condemnation, the title to the Property so taken shall
vest in the condemnor,free and clear of this Agreement,subject to the parties' rights to compensation
as set forth in the preceding sentence, and except for said rights to compensation, this Agreement
19
shall terminate as to the Property so taken, and the rent shall be reduced in accordance with the per-
acre rates set forth in Paragraphs 1.5 and 1.6 above for the remainder of the term of this Agreement.
This paragraph shall not be deemed a waiver or modification of any right which either party may
have to recover directly from such condemnor any claim for business interruption or moving or
relocation expenses.
12. Default and Termination.
12.1. Lessee's Right to Terminate. Lessee shall have the right to terminate this
Agreement, and Assignees and Tenants shall have the right to terminate their respective interests in
or under this Agreement, as to all or any part of the Property at any time, effective upon thirty (30)
days' written notice to Landowner. If such termination is as to only part of the Property, this
Agreement shall remain in effect as to the remainder of the Property.
12.2. Landowner's Right to Terminate. Except as qualified by Section 10 and
by Section 11, Landowner shall have the right to terminate this Agreement if: (i) a material default
in the performance of Lessee's obligations under this Agreement shall have occurred and remains
uncured, (ii) Landowner simultaneously notifies Lessee and all Lenders, Assignees and Tenants in
writing of the default, which notice sets forth in reasonable detail the facts pertaining to the default
and specifies the method of cure, and(iii) the default shall not have been remedied within sixty (60)
days after Lessee, or within one hundred twenty (120) days in the case of all Assignees and Tenants,
receive the written notice, or, if cure will take longer than sixty (60) days for Lessee or one hundred
twenty (120) days for any Assignee or any Tenant, Lessee, or an Assignee or Tenant on Lessee's
behalf, has not begun diligently to undertake the cure within the relevant time period and thereafter
diligently prosecutes the cure to completion.
12.3. Effect of Termination. Upon termination of this Agreement, whether as to
the entire Property or only as to part, Lessee shall (i) upon written request by Landowner, execute
and record a quitclaim deed to Landowner of all of Lessee's right, title and interest in and to the
Property, or to that part thereof as to which this Agreement has been terminated, and (ii) as soon as
practicable thereafter, remove all above-ground Solar Energy Facilities from the Property or portion
as to which this Agreement was terminated, exclusive of any continuing right established pursuant
to this Agreement to survive the term of this Agreement, and restore the soil surface to a condition
reasonably similar to its original condition. If Lessee fails to remove such Solar Energy Facilities
within twelve (12) months of termination of this Agreement, Landowner may do so, in which case
Lessee shall reimburse Landowner for reasonable and actual costs of removal incurred by
Landowner, less any salvage value received by Landowner, within thirty (30) days after receipt of
an invoice from Landowner. Lessee shall continue to make Extended Term Payments until such
Solar Energy Facilities are removed from the Property.
12.4. Cumulative Remedies. Subject to the other terms and conditions of this
Agreement,each party shall have all rights and remedies available at law and in equity for any breach
of this Agreement by the other party.
13. Miscellaneous.
13.1. Force Majeure. If performance of this Agreement or of any obligation
hereunder is prevented or substantially restricted or interfered with by reason of an event of"Force
Majeure" (defined below),the affected party, upon giving notice to the other party, shall be excused
20
from such performance to the extent of and for the duration of such prevention, restriction or
interference. The affected party shall use its reasonable efforts to avoid or remove such causes of
nonperformance and shall continue performance hereunder whenever such causes are removed.
"Force Majeure" means fire, earthquake, flood or other casualty or accident; strikes or labor
disputes; war, civil strife or other violence, any law, order, proclamation, regulation, ordinance,
action, demand or requirement of any government agency or utility, or any other act or condition
beyond the reasonable control of a party hereto. This Section shall not excuse or extend payment
obligations.
13.2. Confidentiality. Landowner shall maintain in the strictest confidence, for the
benefit of Lessee, any Assignee or Tenant, all information pertaining to the financial terms of or
payments under this Agreement, Lessee's site or product design, methods of operation, methods of
construction, power production or availability of the Solar Energy Facilities, and the like, whether
disclosed by Lessee, any Assignee or Tenant, or discovered by Landowner, unless such information
either (i) is in the public domain by reason of prior publication through no act or omission of
Landowner or its employees or agents; or (ii) was already known to Landowner at the time of
disclosure and which Landowner is free to use or disclose without breach of any obligation to any
person or entity. Landowner shall not use such information for its own benefit, publish or otherwise
disclose it to others, or permit its use by others for their benefit or to the detriment of Lessee, any
Assignee or Tenant. Notwithstanding the foregoing, Landowner may disclose such information to
Landowner's lenders, attorneys, accountants and other personal financial advisors solely for use in
connection with their representation of Landowner regarding this Agreement; any prospective
purchaser of the Property who has made a written offer to purchase or otherwise acquire the Property
that Landowner desires to accept; or pursuant to lawful process, subpoena or court order requiring
such disclosure, provided Landowner in making such disclosure advises the party receiving the
information of the confidentiality of the information and obtains the written agreement of said party
not to disclose the information, which agreement shall run to the benefit of and be enforceable by
Lessee. Landowner shall get Lessee's written consent before issuing a press release or having any
contact with or responding to the news media with any operational, sensitive or confidential
information with respect to this Agreement,the solar power project to be constructed on the Property
by Lessee, or any other existing solar power project owned or operated by Lessee. The provisions
of this Section 13.2 shall survive the termination or expiration of this Agreement.
13.3. Successors and Assigns. This Agreement shall burden the Property and shall
run with the land. This Agreement shall inure to the benefit of and be binding upon Landowner and
Lessee and, to the extent provided in any assignment or other transfer under Section 10 hereof, any
Assignee or Tenant, and their respective heirs, transferees, successors and assigns, and all persons
claiming under them. References to "Lessee" in this Agreement shall be deemed to include
Assignees and Tenants that hold a direct ownership interest in this Agreement and actually are
exercising rights under this Agreement to the extent consistent with such interest.
13.4. Memorandum of Lease. Landowner and Lessee shall execute in recordable
form and Lessee shall then record a memorandum of the lease evidenced by this Agreement
reasonably satisfactory in form and substance to Lessee and Landowner. Landowner hereby consents
to the recordation of the interest of an Assignee in the Property.
13.5. Notices. All notices or other communications required or permitted by this
Agreement, including payments to Landowner, shall be in writing and shall be deemed given when
personally delivered, or in lieu of such personal service, five (5) days after deposit in the United
21
States mail, first class, postage prepaid, certified, or the next business day if sent by reputable
overnight courier, provided receipt is obtained and charges prepaid by the delivering party. Any
notice shall be addressed as follows:
If to Landowner: If to Lessee:
City of Pueblo, a Colorado municipal Aurora Solar LLC
Corporation Attn: Contracts Administration
Attn: Mayor of Pueblo 1125 NW Couch, Suite 700
1 City Hall Place Portland, Oregon 97209
Pueblo, CO 81003 Facsimile: (503) 796-6901
Facsimile.: (719) 553-2698 Telephone No.: (503) 796-7000
Telephone No.: (719)553-2611
With copy to:
With copy to: Aurora Solar LLC
City of Pueblo, a Colorado municipal Attn: Real Estate Administration
corporation 1125 NW Couch, Suite 700
Attn: City Attorney Portland, Oregon 97209
1 City Hall Place Facsimile: (503) 796-6901
Pueblo, CO 81003 Telephone No.: (503) 796-7000
For Electronic Funds: If to any Assignee or Tenant:
Information to be provided to Lessee At the address indicated in the notice to
separately and Lessee shall hold the Landowner provided under Section 10.1
same strictly confidential hereof.
Any party may change its address for purposes of this paragraph by giving written notice of such
change to the other parties in the manner provided in this paragraph.
Furthermore, by providing appropriate account information above, Landowner consents to Lessee
making any and all necessary payments due under this Agreement by electronic payment. All
amounts paid into the account listed above shall be deemed received by Landowner upon the
execution of the electronic payment by Lessee.
13.6. Entire Agreement; Amendments. This Agreement constitutes the entire
agreement between Landowner and Lessee respecting its subject matter. Any agreement,
understanding or representation respecting the Property, this Agreement, the Lease or any other
matter referenced herein not expressly set forth in this Agreement, or in a subsequent writing signed
by both parties, is null and void. This Agreement shall not be modified or amended except in a
writing signed by both parties. No purported modifications or amendments, including, without
limitation, any oral agreement (even if supported by new consideration), course of conduct or
absence of a response to a unilateral communication, shall be binding on either party.
22
13.7. Legal Matters.
13.7.1. This Agreement shall be governed by and interpreted in accordance
with the laws of the State Colorado. If the parties are unable to resolve amicably any dispute arising
out of or in connection with this Agreement, they agree that such dispute shall be resolved in the
federal court located in the county in which the Property is situated, or if none, then a federal court
nearest the county in which the Property is situated.
13.7.2. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS
AGREEMENT, NEITHER PARTY SHALL BE ENTITLED TO, AND EACH OF LANDOWNER AND LESSEE
HEREBY WAIVES ANY AND ALL RIGHTS TO RECOVER,CONSEQUENTIAL,INCIDENTAL,AND PUNITIVE
OR EXEMPLARY DAMAGES,HOWEVER ARISING,WHETHER IN CONTRACT,IN TORT,OR OTHERWISE,
UNDER OR WITH RESPECT TO ANY ACTION TAKEN IN CONNECTION WITH THIS AGREEMENT.
13.7.3. EACH OF THE PARTIES KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED
ON THIS AGREEMENT,OR ARISING OUT OF,UNDER OR IN CONNECTION WITH THIS AGREEMENT AND
ANY AGREEMENT CONTEMPLATED TO BE EXECUTED IN CONJUNCTION HEREWITH,OR ANY COURSE
OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS
OF ANY PARTY HERETO. EACH OF THE PARTIES TO THIS AGREEMENT WAIVES ANY RIGHT TO
CONSOLIDATE ANY ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION
IN WHICH A JURY TRIAL CANNOT OR HAS NOT BEEN WAIVED. THIS PROVISION IS A MATERIAL
INDUCEMENT TO EACH OF THE PARTIES FOR ENTERING INTO THIS AGREEMENT.
13.8. Partial Invalidity. Should any provision of this Agreement be held in a final
and unappealable decision by a court of competent jurisdiction to be either invalid, void or
unenforceable, the remaining provisions hereof shall remain in full force and effect and unimpaired
by the court's holding. Notwithstanding any other provision of this Agreement, the parties agree
that in no event shall the term of this Agreement be longer than the longest period permitted by
applicable law.
13.9. Tax Credits. If under applicable law the holder of a leasehold interest in the
nature of that held by Lessee, an Assignee or a Tenant under this Agreement becomes ineligible for
any tax credit, benefit or incentive for alternative energy expenditure established by any local, state
or federal government, then, at Lessee's option, Landowner and Lessee shall amend this Agreement
or replace it with a different instrument so as to convert Lessee's interest in the Property to a
substantially similar interest that makes Lessee eligible for such tax credit, benefit or incentive.
13.10. No Partnership. Nothing contained in this Agreement shall be construed to
create an association,joint venture, trust or partnership covenant, obligation or liability on or with
regard to any one or more of the parties to this Agreement.
13.11. Counterparts. This Agreement 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.
13.12 Decommissioning Security. Lessee shall maintain such bond, letter of credit
or other security ("Decommissioning Security") securing payment of decommissioning costs for
Solar Energy Facilities located on the Property as and to the extent required by applicable
23
governmental authorities in connection with (and as part of) land use and permitting approvals for
the Project. If the applicable governmental authority does not require Decommissioning Security,
then on the date that is twenty-one(21)years after the Operations Date(the"Bonding Date"),Lessee
shall obtain, and maintain in effect for Landowner's benefit throughout the remainder of the
Extended Term, Decommissioning Security in an amount equal to the estimated costs of removing
the Solar Energy Facilities and restore the Property in accordance with Section 12.3 above. The
amount of such costs initially shall be as estimated by a reputable, independent contractor selected
by Lessee. From and after the Bonding Date, the amount of Decommissioning Security may be
reviewed at Landowner's request every five (5) years. In the event such review indicates that the net
decommissioning costs have increased since the Bonding Date, then the amount of the
Decommissioning Security will be increased consistent with such revised estimate. The revised
estimate will be obtained from a reputable, independent contractor selected by Lessee. The
Decommissioning Security shall further be available to Landowner with respect to any failure by
Lessee to remediate hazardous materials released on the Property by Lessee,its agents or contractors.
[Signature and Acknowledgment Pages Follow]
24
IN WITNESS WHEREOF, Landowner and Lessee have caused this Agreement to be executed
and delivered by their duly authorized representatives as of the Effective Date.
LANDOWNER:
CITY OF PUEBLO,a Colorado municipal corporation
Atte • By: •
City Clerk: Brenda Armijo Mayor: Nicholas A. radisar
STATE OFCj)bad?)
) ss.
COUNTY OF'YU&b
The foreping instrument was acknowledged before me this day of NOk..vn tot r",
20Xby N'61616 5rit.d tSCW, as M a OY , personally known to me
(or proved to me on the basis of satisfactory evidence) to be the person(s) whose names(s) is/are
subscribed to the within instrument and acknowledged to me that he/she/they executed the same in
his/her/their authorized capacity(ies), and that by his/her/their signatures(s) on the instrument the
person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
BELINDA KIMBALL N /`I CIA 143114
NOTARY PUBLIC
STATE OF COLORADO Notary Public for Sty ór CO k(4Cdb
NOTARY ID 20094005563 My commission expires: J3/
MY COMMISSION EXPIRES FEBRUARY 23,2021 Commission No.: a GO q'-16065103
25
IN WITNESS WHEREOF, Landowner and Lessee have caused this Agreement to be
executed and delivered by their duly authorized representatives as of the Effective Date.
LESSEE: Aurora Solar LLC,
an Oregon limited liability company
By:
�, Print ame: Sara Parsons
Title: Authorized representative
BY: 4LjkLJlJ
P �Z-
Printed Na Ze:( cLnp t.,r-
Title:A - h (17 id g Q p rLi 1ntab
vi
STATE OF OREGON )
COUNTY OF Multnomah )
MA
iThe 'foregoing instrument was acknowledged before me this I '" day of
/" 4 1
, 202(, by &rr,. Pc.rSuwS and S}crkti•.tt L&t Pier
as Authorized Representatives of Aurora Solar LLC, an Oregon limited liability company, on its
behalf.
sFvr -
,s /
\ :j=;-)Z1
e{\10,.1G(11:',745
• r to :9207.4
No . y Public for G -gon
M commission • sires: P ece cir o2 10 z Y
Commission No.: I v v Sl KS
EXHIBIT A
Description of Property
All that real property located in Pueblo County, State of Colorado, described as follows:
I( WNtiI III' SF:(` I'ION Al,I.OQtJO"r PAR 1
W/2 SW/4, EXCLUDING PUEBLO MOTOR SPORTS PARK
T20S, R65W 16 PROPERTY
ALL LAND IN PARCEL# 517000005
NE/4, SW/4
T20S, R65W 17 E/2, SE/4, SW/4
E/2,N W/4, SW/4
S/2, SW/4
T20S, R65W 18 S/2, SE/4
N/2
T20S, R65W 19 E/2, SE/4
NW/4
N/2, NE/4
S2/, SE/4,NE/4
T20S, R65W 20 S/2, SE/4
E/2,NE/4, SE/4
ALL LAND IN PARCEL# 500000007
T20S, R65W 21 NW/4 NW/4, EXCLUDING PUEBLO MOTOR SPORTS
PARK PROPERTY
27
EXHIBIT B
DEPICTION OF THE PROPERTY
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City o
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Lease Area
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PREPARED BY:
Aurora Solar LLC
Attention: Land Management
1125 NW Couch, Suite 700
Portland, OR 97209
Telephone: 503.796.7000
AFTER RECORDING RETURN TO:
Winthrop & Weinstine
Attn: Krista A. Bengtson-Cook
225 South Sixth Street, Suite 3500
Minneapolis, MN 55402-4629
Telephone: 612.604.6629
(Space above this line for Recorder's use only)
MEMORANDUM OF SOLAR ENERGY AND
ENERGY STORAGE LEASE AGREEMENT
This MEMORANDUM OF SOLAR ENERGY AND ENERGY STORAGE LEASE
AGREEMENT (this "Memorandum") is made, effective as of 'c�Qa�;.�t1 j
2Q2, by and between City of Pueblo, a Colorado municipal corporation ("Landowner"), whose
address is 1 City Hall Place Pueblo,CO 81003 and Aurora Solar LLC,an Oregon limited liability
company ("Lessee"), whose address is Attn: Land Management, 1125 NW Couch, Suite 700,
Portland, Oregon 97209, in light of the following facts and circumstances:
Landowner and Lessee entered in that certain Solar Energy and Energy Storage Lease
Agreement, of even date herewith (the "Agreement"), pursuant to which Landowner has leased
to Lessee the real property of Landowner (the "Property") located in Pueblo County, Colorado,
as more particularly described on Exhibit A attached hereto and which Agreement and said Exhibit
A are hereby incorporated herein as if fully set forth in this Memorandum. Landowner and Lessee
have executed and acknowledged this Memorandum for the purpose of providing constructive
notice of the Agreement. Capitalized terms not otherwise defined in this Memorandum shall have
the meanings provided in the Agreement. In the event of any conflict or inconsistency between
the provisions of this Memorandum and the provisions of the Agreement, the provisions of the
Agreement shall control. Nothing in this Memorandum shall be deemed to amend, modify,
change, alter, amplify, limit, interpret or supersede any provision of the Agreement or otherwise
limit or expand the rights and obligations of the parties under the Agreement and the Agreement
shall control over this Memorandum in all events.
NOW THEREFORE, Landowner and Lessee hereby agree as follows:
1. Lease of Property; Easements. Landowner leases the Property to Lessee on the
terms, covenants and conditions stated in the Agreement. The lease created by the Agreement is
solely and exclusively for Solar Operations or Energy Storage, or both, as defined in the
Agreement, and Lessee shall have the exclusive right to use the Property for Solar Operations and
Energy Storage purposes, together with certain related access and easement rights and other rights
related to the Property as more fully described in the Agreement. Reference is hereby made to the
Agreement for a complete description of the respective rights and obligations of the parties
regarding the Property and the covenants, conditions, restrictions and easements affecting the
Property pursuant to the Agreement.
2. Term. Lessee's rights under the Agreement shall commence on the Effective Date
and continue for five(5)years(the"Development Period")thereafter. If either(i)any Generation
Facilities installed by Lessee on the Property begin generating electrical energy or any Energy
Storage Facilities begin capturing and storing energy for use at a later time the Property during the
Development Period, or(ii) Lessee pays Landowner the first Extended Term Lease Rate payment,
then the Agreement shall automatically be extended for an Extended Term of forty (40) years. In
the event of any such extension for the Extended Term, the Extended Term shall commence on
the first to occur of (i) the Operations Date, or (ii) the expiration of the Development Period.
During the Extended Term, Lessee and any Tenant or Assignee may, by notice to Landowner no
later than thirty (30) days prior to the expiration of the Extended Term, elect to extend the
Agreement for an additional ten-year period commencing upon the expiration of the Extended
Term (the "Renewal Term"). With respect to an extension of the term of the Agreement, at
Lessee's election and discretion, Landowner and Lessee shall execute in recordable form, and
Lessee will then record, a memorandum evidencing the extension, satisfactory in form and
substance to Lessee.
3. Ownership. Landowner shall have no ownership or other interest in any Solar
Energy Facilities installed on the Property.
4. No Interference. Among other things, the Agreement provides that Landowner's
activities and any grant of rights Landowner makes to any person or entity, whether located on the
Property or elsewhere, shall not, currently or in the future, impede or interfere with: i) the siting,
permitting, construction, installation, maintenance, operation, replacement, or removal of Solar
Energy Facilities located on the Property; (ii) access over the Property to Solar Energy Facilities;
(iii)the undertaking of any other activities of Lessee permitted under this Agreement; (iv) the
availability, accessibility, or non-obstructed passage of direct solar radiation across the Property;
or(v) the transmission of electric,electromagnetic or other forms of energy to or from the Property.
In no event during the term of the Agreement shall Landowner construct, build or locate or allow
others to construct, build or locate any Solar Energy System, Solar Energy Facilities or similar
project on the Property.
5. Successors and Assigns. The Agreement and any easement or rights granted
Lessee therein shall burden the Property and shall run with the land. The Agreement shall inure
to the benefit of and be binding upon Landowner and Lessee and, to the extent provided in any
assignment or other transfer under the Agreement, any Assignee or Tenant, and their respective
heirs, transferees, successors and assigns, and all persons claiming under them.
6. Multiple Counterparts. This Memorandum may be executed by different parties
on separate counterparts, each of which, when so executed and delivered, shall be an original, but
all such counterparts shall constitute one and the same instrument.
2
7. Governing Law. This Memorandum and the Agreement shall be governed by and
interpreted in accordance with the laws of the State of Colorado.
[Signatures and Acknowledgments Follow]
3
IN WITNESS WHEREOF, Landowner and Lessee have caused this Memorandum to be
executed and delivered by their duly authorized representatives as of the date first written above.
LANDOWNER: City of Pueblo,
a Colorado municipal corporation
Name: Nicholas A. radisar
Title: Mayor
STATE OFIbr b
) ss.
COUNTY OFT U (b
The foregoing instrument was acknowledged before me this 1 ( day of NOVA-1'n bc.4-"1
20 by Nickio415 Gadtstr, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person(s) whose names(s) is/are subscribed to the within
instrument and acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signatures(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
A KIMBALL
NOTARY �/� ACIA
PUBLIC5k k- O e}is 2cGb
STATE OF COLORADO Notary Public for
NOTARY ID 20094005563 My commission expires: �a3 ��l
MY COMMISSION EXPIRES FEBRUARY 23,2021 Commission No.: vt 0641 i4(c055(p3
4
IN WITNESS WHEREOF, Landowner and Lessee have caused this Memorandum to be
executed and delivered by their duly authorized representatives as of the date first written above.
LESSEE: Aurora Solar LLC,
an Oregon limited liability company
v)�'�qt' By:
Printed Name: Sara Parsons
Title: Authorized Representative
By:
Printed Na e: Sly ha n'i 1AL p 1 �.
Title:A IA.I n t 1lZE� ‘U,11 Ran ta
STATE OF OREGON )
COUNTY OF Multnomah )
The forgoing instrument was acknowledged before me this %ttday of A44 y
20at by >c ,
os s and 54"too.:c 1_ /'er lI as
Authorized Representatives of Aurora Solar LLC, an Oregon limited liability company, on its
behalf.
OFFICIAL STAMP
ice;,. ,i1,.-711
1`101 ik'tY HY3LIC Or G,ON
0',1•11SSION NO.1003745
nFr`'WIBER 02,2024
No : Public for/egon
My commission -xpires: Ilcewi cr O1/ c)zy
Commission No.: I&c,ci`i S'
EXHIBIT A
Description of Property
All that real property located in Pueblo County, State of Colorado, described as follows:
o\\NSI III' SI'(' I ION Ai 1 °0101 I' AR I
T20S, R65W 16 W/2 SW/4, EXCLUDING PUEBLO MOTOR SPORTS PARK
PROPERTY
ALL LAND IN PARCEL# 517000005
T20S, R65W 17 NE/4, SW/4
E/2, SE/4, SW/4
E/2,NW/4, SW/4
T20S, R65W 18 S/2, SW/4
S/2, SE/4
T20S, R65W 19 N/2
E/2, SE/4
NW/4
N/2,NE/4
S2/, SE/4,NE/4
T20S, R65W 20 S/2, SE/4
E/2,NE/4, SE/4
ALL LAND IN PARCEL# 500000007
T205, R65W 21 NW/4 NW/4, EXCLUDING PUEBLO MOTOR SPORTS PARK
PROPERTY
ADDENDUM TO SOLAR ENERGY AND ENERGY STORAGE LEASE AGREEMENT` �t.►
THIS ADDENDUM (hereinafter called the "Addendum") is made thegtday of r t�
, 2(171, between the City of Pueblo, a Colorado municipal corporation (hereinafter
called the"Landowner") and Aurora Solar LLC, an Oregon limited liability company (hereinafter
called the "Lessee"). This Addendum supplements and modifies that certain Solar Energy and
Energy Storage Lease Agreement (hereinafter called the "Agreement") of even date herewith,
entered into between the Landowner and Lessee. The definitions set forth in the Agreement are
equally applicable to this Addendum. Landowner and Lessee stipulate and agree that in the event
of a conflict between the terms and conditions of the Agreement and this Addendum, the terms
and conditions of this Addendum shall control. The Landowner and the Lessee are referred to
collectively in this Addendum as the "Parties" and individually, without differentiation, each as a
Party.
14. Annexation. Prior to the commencement of construction of Improvements on the
Property, Lessee shall complete the process of annexing the Property into the corporate City limits
of the Landowner. Completion of the annexation process shall mean recordation of the Ordinance
annexing the Property into the City of Pueblo.
15. Filings of Record. The leasehold interest conveyed by Landowner to the Lessee in
the Agreement is subject to and subordinate to the terms and conditions of that certain Deed of
Conservation Easement Honor Farm Open Space and Park parcels City of Pueblo, dated June 29,
2001 and also subject to and subordinate to all easements, reservations, restrictions, covenants,
limitations, rights-of-way and conditions of record. In addition, the leasehold interest conveyed
in the Agreement is for the surface estate only and no mineral rights are conveyed by the
Agreement.
16. Colorado Open Records Act. As a public entity, Landowner is subject to the
Colorado Open Records Act("CORA")C.R.S.24-72-200.1,et seq. which requires the Landowner
to make available for inspection all public records as defined by state law. The Parties agree that
while the Agreement and the Addendum are public records subject to inspection by the public,
other documents and materials in the possession of the Landowner may qualify as "trade secrets,
privileged information, and confidential commercial, financial, geological, or geophysical data"
which are statutorily precluded from public inspection. In the event that Landowner receives a
CORA request for inspection of documents or materials (other than the Agreement and the
Addendum) Landowner shall provide Lessee with written notice of such CORA request to permit
Lessee to object to such public inspection. Should the Lessee object to public inspection and
should the person making the CORA request file a lawsuit against the Landowner to compel public
inspection, Lessee shall defend and hold the Landowner harmless in such litigation including the
payment of all judgments, costs and attorney fees.
17. Taxes. With respect to the Solar Project, Lessee shall cause to be paid, before
delinquency, all sales and use taxes and all property taxes levied or charged against any of the
personal property situated on the Property and all possessory interest real property taxes levied or
assessed against the Property.
1
18. Utilities. Lessee shall pay all charges for sewer, water, gas, electricity, telephone
and all other utility services furnished to or used in or supplied to the Property. Landowner shall
not furnish, provide or pay for any utilities or services of any kind.
19. Condition of Property.
19.1 IT IS UNDERSTOOD AND AGREED THAT LANDOWNER IS NOT MAKING
AND HAS NOT AT ANY TIME, MADE ANY WARRANTY OR REPRESENTATION OF
ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE
PROPERTY, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTY OR
REPRESENTATION AS TO HABITABILITY, MERCHANTABILITY, FITNESS FOR A
PARTICULAR PURPOSE, TITLE (OTHER THAN THE COVENANT OF QUIET
POSSESSION SET FORTH IN THE AGREEMENT), ZONING, PHYSICAL OR
ENVIRONMENTAL CONDITIONS, UTILITIES, GOVERNMENTAL APPROVALS,
COMPLIANCE OF THE LEASED PREMISES WITH GOVERNMENTAL LAWS, THE
TRUTH, ACCURACY OR COMPLETENESS OF ANY DOCUMENT OR OTHER
INFORMATION PROVIDED TO LESSEE BY ANY OTHER PERSON, OR ANY OTHER
MATTER OR THING REGARDING THE PROPERTY.
19.2 The taking of possession of the Property by Lessee after the Effective Date shall be
conclusive evidence that the Lessee accepts the Property in its then present condition"As Is,Where
Is, With All Faults" and that the Property is in good and satisfactory condition at the time of the
commencement of the lease.
20. Integration. Except as supplemented and modified by this Addendum, the
provisions of the Agreement shall remain unchanged and in full force and effect and fully binding
on the Parties, their successors and assigns and the Agreement and this Addendum shall be
construed together as a single integrated document.
21. Fencing. Lessee, at its own cost and expense, shall install fencing along the
perimeter of the Solar Energy Facilities to secure and enclose the same.
22. Removal of vegetation. Only minimal vegetation removal is permitted as
necessary, upon the prior written approval of the City of Pueblo Park and Recreation Director, for
the construction and installation of the Solar Energy Facilities.
IN WITNESS WHEREOF, this Addendum is executed by the Parties hereto in their
respective names as of the date first above written.
2
LESSEE:
AURORA SOLAR LLC
AN OREGON LIMITED LIABILITY COMPANY
By: •- i)64, y%ND
Printed Name: Sara Parsons
Authorized Representative
Title:
By: )4
- Lt /L�v -tJp.,t� )
Printed Name: U I- I` h ( f 1 0 LA P QX
Title: 6UIi- r' Uf2.(.d V( Lp TtfLii t tIL tv/ .
STATE OF OREGON )
) ss.
COUNTY OF MULTNOMAH )
The foregoing instrument was acknowledged before me this IV" day of JA 4y
, 20ak by 54rh, ?cc -5cm S and 54q ctact Lc acv 1
as authorized representatives of Aurora Solar LLC, an Oregon limited liability company, on its
behalf.
Witness my hand and official seal.
`
My commission expires: PeccAbo- o kart
,,,;. OFFICIAL STAMP
[ SEAL ] �"��, l�La 't. ���'�''SI i'�w!�Ir
)- NOT=PLICLIC-OFIEGON No .ry Public
d6 COMi,ISSION NO.1005745
MMY COMMISSION EXPIRES DECEMBER 02,2024
LANDOWNER:
CITY OF PUEBLO, A COLORADO
MUNICIPAL CORPORATION
4.741401 ATTEST:
By: Nicholas A. adisar, Mayor 1X/ALA-0'
Brenda Armijo, City Cler
3