9.e) SOLAR POWER PURCHASE AGREEMENTNovel Energy
Solutions
Solar Power Purchase Agreement
This Solar Power Purchase Agreement (this "Agreement") is entered into by the parties listed below (each a "Party" and collectively
the "Parties") as of the date signed by Seller below (the "Effective Date").
Buyer:
Pricing Attachment
Seller:
System Description, Delivery Point and Premises
Name
City of Scandia
Name
Novel Energy Solutions, LLC
and
Scandia Community and Senior Center
and
23913 County Road 39
Address
14727 209th Street N.
Address
St. Charles, MN 55972
Scandia, MN 55073
Attention: Clifton Kaehler
Attn: City Administrator
Phone
(651)433-2274
Phone
507-272-5401
E-mail
E-mail
cliff.kaehlergnovelenergy.biz
Facility
City of Scandia
Ownership
System
TBD
TBD
Ownership
This Agreement sets forth the terms and conditions of the purchase and sale of electricity generated from the photovoltaic energy
generation system described in Exhibit 2 (the "System") and installed at the Buyer's facility described in Exhibit 2 (the "Facility").
The exhibits listed below are incorporated by reference and made part of this Agreement.
Exhibit 1
Pricing Attachment
Exhibit 2
System Description, Delivery Point and Premises
Exhibit 3
Credit Information
Exhibit 4
General Terms and Conditions
Exhibit 5
Independent Energy Production Analysis
BUYER: SELLER:
CITY OF SCANDIA, MN
NOVEL ENERGY SOLUTIONS, LLC
By:
By:
Its:
Its:
Date:
Date:
Novel Energy Solutions, LLC Solar Power Purchase Agreement 2014 08 25
Version08252014
Exhibit 1
Pricing Attachment
1. PPATerm: Twenty (20) years, beginning on the Commercial Operation Date. Buyer has an option to purchase the System at
the end of the 20 year Term for Faire Market Value as defined in this Agreement provided the System produces at least 50%
of its expected output (so to allow Seller to obtain a minimum 4% pre-tax return).
2. Additional Terms: The City shall have up to two (2) Additional Terms of five (5) years each pursuant to Section 3(b) of the
General Terms and Conditions.
3. Currently Existing Environmental Incentives and Environment Attributes shall accrue to Seller. Any future
Environmental Incentive and Environment Attributes shall be negotiated in good faith between Buyer and Seller.
4. Contract Price:
The Contract Price for the electicicity produced by array will be discounted by 15% to Xcel Energy County price paid by
Buyer/ kWh. This price will increase or decrease proportionately each subsequent Contract Year with each applicable rate
decrease or increase under the Xcel Energy County (the "Utility") Tariff for the class or category of customer applicable to
Buyer; The rate increase/decrease for a given year will go into effect at the time the annual rate increase/decrease from the
Utility goes into effect. For the purposes of this Agreement, a "Contract Year" shall mean each calendar year during which
this Agreement is in effect, except that the initial Contract Year shall commence on the Effective Date and the final Contract
Year shall end on the last day of the Term.
Includes ACH invoicing. If manual invoicing is required,an agreed upon handling charge will be added to each invoice.
5. Condition Satisfaction Date: , 2015
6. Anticipated Commercial Operation Date: TBD
7. Outside Commercial Operation Date: TBD
Novel Energy Solutions, LLC Solar Power Purchase Agreement 2014 08 25
Version08252014
Exhibit 2
System Description, Delivery Point and Premises
1. System Location(s): TBD
2. System Size (DC kW): kW TBD
3. Expected First Year Energy Production (kWh): TBD
4. Expected Structure: Roof
5. Expected Module(s):
Manufacturer/Model Quantity
TBD #
6. Expected Inverter(s):
TBD Quantity
7. Includes:
Balance of System and complete array(s) installation
8. Excludes:
Force Majeure
9. Delivery Point and Premises: Seller shall attach a schematic that contains the:
(i) Facility;
(ii) array;
(iii) Delivery Point; and
(iv) access points needed to install and service System (building access, electrical room, stairs etc.)
10. System Operation and Management: Novel Energy Solutions, LLC
Address
Attach Photo(s)
11426556x2
Exhibit 3
1.
2
11426556x2
Exhibit 4
Solar Power Purchase Agreement General Terms and Conditions
Version dated August 25, 2014
Definitions and Interpretation: Unless otherwise defined or required by the context in which any term appears: (a) the
singular includes the plural and vice versa; (b) the words "herein," "hereof' and "hereunder" refer to this Agreement as a
whole and not to any particular section or subsection of this Agreement; (c) references to any agreement, document or
instrument mean such agreement, document or instrument as amended, modified, supplemented or replaced from time to
time; and (d) the words "include," "includes" and "including" mean include, includes and including "without limitation."
2. Purchase and Sale of Electricity. Buyer shall purchase from Seller, and Seller shall sell to Buyer, all of the electric energy
generated by the System during the Initial Term and any Additional Term (as defined in Exhibit 1, and collectively the
"Term"). Electric energy generated by the System will be delivered to Buyer at the delivery point identified on Exhibit 2
(the "Delivery Point").. Buyer shall take title to the electric energy generated by the System at the Delivery Point, and risk of
loss will pass from Seller to Buyer at the Delivery Point. Buyer may purchase electric energy for the Facility from other
sources if the Buyer's electric requirements at the Facility exceed the output of the System.
3. Term and Termination.
a. Initial Term. The initial term ("Initial Term") of this Agreement shall commence on the Commercial Operation
Date (as defined below) and continue for the length of time specified in Exhibit 1, unless earlier terminated as
provided for in this Agreement. The "Commercial Operation Date" is the date Seller gives Buyer written notice
that the System is mechanically complete and capable of providing electric energy to the Delivery Point.
Upon Buyer's request, Seller will give Buyer copies of certificates of completion or similar documentation from
Seller's contractor and the interconnection or similar agreement with the Utility. This Agreement is effective as of
the Effective Date and Buyer's failure to enable Seller to provide the electric energy by preventing it from
installing the System or otherwise not performing shall not excuse Buyer's obligations to make payments that
otherwise would have been due under this Agreement.
b. Additional Terms. If Buyer has not exercised its option to purchase the System by the end of the Initial Term,
either Party may give the other Party written notice of its desire to extend this Agreement on the terms and
conditions set forth herein for the number and length of additional periods specified in Exhibit 1 (each an
"Additional Term"). Such notice shall be given, if at all, not more than one hundred twenty (120) and not less
than sixty (60) days before the last day of the Initial Term or the then current Additional Term, as applicable. The
Party receiving the notice requesting an Additional Term shall respond positively or negatively to that request in
writing within thirty (30) days after receipt of the request. Failure to respond within such thirty (30) day period
shall be deemed a rejection of the offer for an Additional Term. If both Parties agree to an Additional Term, the
Additional Term shall begin immediately upon the conclusion of the Initial Term or the then current term on the
same terms and conditions as set forth in this Agreement. If the Party receiving the request for an Additional Term
rejects or is deemed to reject the first Party's offer, this Agreement shall terminate at the end of the Initial Term (if
the same has not been extended) or the then current Additional Term.
4. Billing and Payment.
a. Monthly Charges. Buyer shall pay Seller monthly for the electric energy projected to be generated by
the System and delivered to the Delivery Point at the $/kWh price shown in Exhibit 1 as the same may be
adjusted as contemplated therein (the "Contract Price"). The monthly payment for such energy will be
equal to the applicable $/kWh price multiplied by the number of kWh of energy projected to be generated
during the applicable month as measured by the monthly independent energy production analysis for the
Term attached hereto at Exhibit 5. At the end of each calendar year, Seller will conduct a true up to
account for any excess or shortfall in projected generation versus actual generation as described in Section
4(c). The first and last year true ups will likely be less than 12 months.
b. The Seller will provide monthly bill equivalent to (1/12 of the expected annual production of the sytem
(based upon panel age and mfg warranty) x Xcel's current kWh price to Buyer x 0.85 (85%).
11426556x2
C. The excess/shortage of actual kWh production (based upon Xcel Energy County production meter) will be
adjusted to the rightful party within 30 days of the receipt of the previous year's actual production
summary (likely mid- Feb). This is the "-True Up" or correction of energy value from the solar system.
d. Monthly Invoices. Seller shall invoice Buyer monthly, as provided in Section 4(e). Such monthly
invoices shall state (i) the amount of electric energy projected to be produced by the System and delivered
to the Delivery Point, (ii) the prices applicable to, discounted pricing applied to, and charges incurred by,
Buyer under this Agreement and (iii) the total amount due from Buyer.
e. Annual True Up. Seller shall provide Buyer a detailed statement for each calendar year's solar array
production within 30 days of receipt of the summary — expected to be mid-February and not less than30
days after receipt of the yearly summary. This statement will account for any difference of projected
production to actual production (as measured by the System meter). In the event that the System
overproduces the projected amount, Buyer will make a payment to Seller equal to the $/kWh price for
each kWh of overproduction, and in the event that the System underproduces the projected amount, Seller
will make a payment to Buyer equal to the $/kWh price for each kWh of underproduction. Annual true -up
payments shall be due from Buyer or Seller, as applicable, within thirty (30) days of Buyer's receipt of the
detailed statement for the Contract Year described above in this Section 4(c).
L Taxes. Buyer shall either pay or reimburse Seller for any and all taxes assessed on the generation, sale,
delivery or consumption of electric energy produced by the System or the interconnection of the System to
the Utility's electric distribution system, excluding property taxes on the System; provided, however,
Buyer will not be required to pay or reimburse Seller for any taxes during periods when Seller fails to
deliver electric energy to Buyer due to the action or omission of Seller. For purposes of this Section 4(c),
"Taxes" means any federal, state and local ad valorem, property, occupation, generation, privilege, sales,
use, consumption, excise, transaction, and other taxes, regulatory fees, surcharges or other similar charges,
but shall not include any income taxes or similar taxes imposed on Seller's revenues due to the sale of
energy under this Agreement, which shall be Seller's responsibility.
g. Payment Terms. All amounts due under this Agreement shall be due and payable net thirty (30) days
from receipt of invoice. Seller will issue invoices on the first week of each calendar month for projected
energy deliveries during the preceding calendar month, with the exception of the annual true up
contemplated in Section 4(c),
5. Environmental Attributes and Environmental Incentives.
Unless otherwise specified on Exhibit 1, Seller is the owner of all Environmental Attributes and Environmental Incentives
and is entitled to the benefit of all Tax Credits, and Buyer's rights under this Agreement do not include all current
Environmental Attributes, Environmental Incentives or the right to Tax Credits or any other attributes of ownership and
operation of the System, all of which shall be retained by Seller. Buyer shall cooperate with Seller in obtaining, securing and
transferring all Environmental Attributes and Environmental Incentives and the benefit of all Tax Credits, including by using
the electric energy generated by the System Buyer shall not be obligated to incur any out—of—pocket costs or expenses in
connection with such actions unless reimbursed by Seller. If any Environmental Incentives are paid directly to Buyer, Buyer
shall immediately pay such amounts over to Seller. To avoid any conflicts with fair trade rules regarding claims of solar or
renewable energy use, Buyer, if engaged in commerce and/or trade, shall submit to Seller for approval any press releases
regarding Buyer's use of solar or renewable energy and shall not submit for publication any such releases without the written
approval of Seller. Approval shall not be unreasonably withheld, and Seller's review and approval shall be made in a timely
manner to permit Buyer's timely publication.
"Environmental Attributes" means any and all credits, benefits, emissions reductions, offsets, and allowances, howsoever
entitled, attributable to the System, the production of electrical energy from the System and its displacement of conventional
energy generation, including (1) any avoided emissions of pollutants to the air, soil or water such as sulfur oxides (SOx),
nitrogen oxides (NOx), carbon monoxide (CO) and other pollutants; (2) any avoided emissions of carbon dioxide (CO2),
methane (CH4), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases
(GHGs) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by law,
to contribute to the actual or potential threat of altering the Earth's climate by trapping heat in the atmosphere; and (3) the
reporting rights related to these avoided emissions, such as Green Tag Reporting Rights and Renewable Energy Credits.
Green Tag Reporting Rights are the right of a Party to report the ownership of accumulated Green Tags in compliance with
federal or state law, if applicable, and to a federal or state agency or any other party, and include Green Tag Reporting Rights
4
11426556x2
accruing under Section 1605(b) of The Energy Policy Act of 1992 and any present or future federal, state, or local law,
regulation or bill, and international or foreign emissions trading program.
Environmental Attributes do not include Environmental Incentives and Tax Credits. Buyer and Seller shall file all tax returns
in a manner consistent with this Section 5. Without limiting the generality of the foregoing, Environmental Attributes
include carbon trading credits, renewable energy credits or certificates, emissions reduction credits, investment credits,
emissions allowances, green tags, tradeable renewable credits and Green -e® products.
"Environmental Incentives" means any and all credits, rebates, subsidies, payments or other incentives that relate to self—
generation of electricity, the use of technology incorporated into the System, environmental benefits of using the System, or
other similar programs available from the Utility, any other regulated entity, the manufacturer of any part of the System or
any Governmental Authority, including the State of Minnesota's Made in Minnesota Solar PV Production Based Incentive
Program.
"Governmental Authority" means any national, state or local government (whether domestic or foreign), any political
subdivision thereof or any other governmental, quasi -governmental, judicial, public or statutory instrumentality, authority,
body, agency, bureau or entity (including the Federal Energy Regulatory Commission), or any arbitrator with authority to
bind a party at law.
"Tax Credits" means any and all (i) investment tax credits, (ii) production tax credits and (iii) similar tax credits or grants
under federal, state or local law relating to the construction, ownership or production of energy from the System.
6. Conditions to Obligations.
a. Conditions to Seller's Obligations. Seller's obligations under this Agreement are conditioned on the completion of
the following conditions to Seller's reasonable satisfaction on or before the Condition Satisfaction Date:
i. Completion of a physical inspection of the Facility and the property upon which the Facility is located (the
"Premises") including, if applicable, geotechnical work, and real estate due diligence to confirm the
suitability of the Facility and the Premises for the System; no invasive or destructive testing will be done
without buyer's permission and seller will restore any damage caused by inspections.
ii. Approval of (A) this Agreement and (B) the Construction Agreement (if any) for the System by Seller's
Financing Parties or by the applicable party extending credit. "Construction Agreement" as used in this
subsection means an agreement between seller and a contractor to install the System;
iii. Confirmation that Seller will obtain all applicable Environmental Incentives and Tax Credits;
iv. Receipt of all necessary zoning, land use and building permits;
V. Execution of all necessary agreements with the Utility for interconnection of the System to the Utility's
electric distribution system; and
vi. Prior to Seller commencing construction and installation of the System, Buyer shall give Seller proof of
insurance for all insurance required to be maintained by Buyer under this Agreement.
b. Conditions to Buyer's Obligations. Buyer's obligations under this Agreement are conditioned on the occurrence
of the Commercial Operation Date for the System on or before the Outside Commercial Operation Date (See
Exhibit 1 .
C. Failure of Conditions. If any of the conditions listed in subsections a or b above are not satisfied by the applicable
dates specified in those subsections, the Parties will attempt in good faith to negotiate new dates for the satisfaction
of the failed conditions. If the Parties are unable to negotiate new dates then the Party that has not failed to meet an
obligation may terminate this Agreement upon ten (10) days written notice to the other Party without liability for
costs or damages or triggering a default under this Agreement.
Seller's Rights and Obligations.
a. Permits and Approvals. Seller, with Buyer's reasonable cooperation, shall use commercially reasonable efforts to
obtain, at its sole cost and expense:
11426556x2
i. any zoning, land use and building permits required to construct, install and operate the System; and
any agreements and approvals from the Utility necessary in order to interconnect the System to the Utility's
electric distribution system.
Buyer shall cooperate with Seller's reasonable requests to assist Seller in obtaining such agreements, permits and
approvals.
b. Standard System Repair and Maintenance. Seller shall construct and install the System at the Facility using
industry accepted procedures and construction methods. During the Term, Seller will operate and perform all routine
and emergency repairs to, and maintenance of, the System at its sole cost and expense, except for any repairs or
maintenance resulting from Buyer's willful misconduct or breach of this Agreement or the Site Lease (if applicable).
Seller shall not be responsible for any work done by others on any part of the System unless Seller authorizes that
work in advance in writing. Seller shall not be responsible for any loss, damage, cost or expense arising out of or
resulting from improper environmental controls or improper operation or maintenance of the System by anyone
other than Seller or Seller's contractors. If the System requires repairs for which Buyer is responsible, Buyer shall
pay Seller for diagnosing and correcting the problem at Seller or Seller's contractors' then current standard rates.
Seller shall provide Buyer with twenty-four hours advanced notice prior to accessing the Facility to make standard
repairs.
Seller will minimize disruptions to City of Scandia operations during construction and maintenance.
C. Breakdown Notice. Seller shall notify Buyer within twenty-four (24) hours following Seller's discovery of (i) any
material malfunction in the operation of the System or (ii) an interruption in the supply of electrical energy from the
System. Buyer and Seller shall each designate personnel and establish procedures such that each Party may provide
notice of such conditions requiring Seller's repair or alteration at unusual times including weekends and holidays.
d. Suspension. Notwithstanding anything to the contrary herein, Seller shall be entitled to suspend operation of the
System for the purpose of maintaining and repairing the System and such suspension of operation shall not
constitute a breach of this Agreement; provided, that Seller shall use commercially reasonable efforts to minimize
any interruption in operation to the Buyer.
e. Use of Contractors and Subcontractors. Seller shall be permitted to use contractors and subcontractors to perform
its obligations under this Agreement, but City of Scandia will have the right to review and approve of any
subcontractors entering the facility. However, Seller shall continue to be responsible for the quality of the work
performed by its contractors and subcontractors. If a list of pre -approved contractors and subcontractors is desired,
such list shall be scheduled on an appendix to this Exhibit.
C Liens and Payment of Contractors and Suppliers. Seller shall pay when due all valid charges from all
contractors, subcontractors and suppliers supplying goods or services to Seller under this Agreement and shall keep
the Facility free and clear of any liens related to such charges, except for those liens which Seller is permitted by law
to place on the Facility following non-payment by Buyer of amounts due under this Agreement. Seller shall
indemnify Buyer for all claims, losses, damages, liabilities and expenses resulting from any liens filed against the
Facility or the Premises in connection with such charges; provided, however, that Seller shall have the right to
contest any such lien, so long as it provides a statutory bond or other reasonable assurances of payment that either
remove such lien from title to the Facility and the Premises or that assure that any adverse judgment with respect to
such lien will be paid without affecting title to the Facility and the Premises.
g. Separate Warran
Any warranty that Seller provides to Buyer is a separate contract from this Agreement. No rights provided
to Buyer by any warranty may be asserted under this Agreement. No warranty is made in this Agreement.
Therefore, any warranty claim must be made independently of this Agreement under the warranty and will
not affect Buyer's obligations under this Agreement.
ii. NO WARRANTY OR REMEDY, WHETHER STATUTORY, WRITTEN, ORAL, EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, OR WARRANTIES ARISING FROM COURSE OF
DEALING OR USAGE OF TRADE SHALL APPLY TO ANY SERVICES OR GOODS FURNISHED
UNDER THIS AGREEMENT.
0
11426556x2
8. Buyer's Rights and Obligations.
a. Facility Access Rights. Buyer grants to Seller and to Seller's agents, employees and contractors an irrevocable
non-exclusive license running with the Premises (the "License") for access to, on, over, under and across the
Premises for the purposes of (i) installing, constructing, operating, owning, maintaining, accessing, removing and
replacing the System; (ii) performing all of Seller's obligations and enforcing all of Seller's rights set forth in this
Agreement; and (iii) installing, using and maintaining electric lines and equipment, including inverters and meters,
necessary to interconnect the System to Buyer's electric system at the Facility and/or to the Utility's electric
distribution system or that otherwise may from time to time be useful or necessary in connection with the
construction, installation, operation, maintenance or repair of the System. Seller shall provide Buyer with not less
than 24-hour advanced notice prior to entering the Facility and shall try to minimize any disturbance except in
situations where there is imminent risk of damage to persons or property. The term of the License shall continue
until the date that is 90 days following the date of expiration or termination of this Agreement (the "License
Term"). During the License Term, Buyer shall ensure that Seller's rights under the License and Seller's access to
the Premises are preserved and protected and shall not interfere with or permit any third parties to interfere with
such rights or access.
b. OSHA Compliance. Both parties shall ensure that all Occupational Safety and Health Act (OSHA) requirements
and other similar applicable safety laws or codes are adhered to in their performance under this Agreement.
C. Maintenance of Facility. Buyer shall, at its sole cost and expense, maintain the Facility in good condition and
repair. Buyer will ensure that the Facility remains interconnected to the local utility grid. Buyer is fully responsible
for the maintenance and repair of the Facility's electrical system and of all of Buyer's equipment that utilizes the
System's outputs. Buyer shall properly maintain in full working order all of Buyer's electric supply or generation
equipment that Buyer may shut down while utilizing the System. Buyer shall promptly notify Seller of any matters
of which it is aware pertaining to any damage to or loss of use of the System or that could reasonably be expected to
adversely affect the System.
d. No Alteration of Facility. Buyer shall not make any alterations or repairs to the Facility which will adversely affect
the operation and maintenance of the System without Seller's prior written consent, except in emergency situations
where immediate action is accepted. If Buyer wishes to make such alterations or repairs, Buyer shall give prior
written notice to Seller, setting forth the work to be undertaken (except for emergency repairs, for which notice may
be given by telephone), and give Seller the opportunity to advise Buyer in making such alterations or repairs in a
manner that avoids damage to the System. To the extent that temporary disconnection or removal of the System is
necessary to perform such alterations or repairs, such work and any replacement of the System after completion of
Buyer's alterations and repairs shall be done by Seller or a seller approved contractor at Buyer's cost. All of
Buyer's alterations and repairs will be done in a good and workmanlike manner and in compliance with all
applicable laws, codes and permits. Buyer and Seller both acknowledge that the roof of the Facility is scheduled for
replacement in 2019. Buyer will endeavor to provide Seller with at least 90 days advanced written notice of the
remailer and will provide Seller with an estimate of the time it will take for the repair. Buyer and Seller will work in
a cooperative manner to ensure minimal disruption related to the temporary disconnection or removal of the System.
e. Outages. Buyer shall be permitted to be off line for a total of forty-eight (48) day light hours (4 complete days)
(each, a "Scheduled Outage") per calendar year during the Term, during which days Buyer shall not be obligated to
reimburse Seller for lost or recaptured Environmental Incentives or lost sales (and penalties payments associated
with the same) of associated Environmental Attributes (collectively, "Lost Environmental Revenue"), as otherwise
provided herein; provided, however, that Buyer must notify Seller in writing of each such Scheduled Outage at least
forty-eight (48) hours in advance of the commencement of a Scheduled Outage. In the event that Scheduled
Outages exceed a total of forty-eight (48) day light hours per calendar year or there are unscheduled outages, in each
case for a reason other than a Force Majeure event, Seller shall reasonably estimate the amount of Lost
Environmental Revenue resulting from such excess Scheduled Outages or unscheduled outages and shall invoice
Buyer for such amount in accordance with Section 4. For avoidance of doubt, the forty-eight (48) hour period shall
include all Scheduled Outage hours allowed under any of the terms of this Agreement, including those undertaken
pursuant to Section 8(d).
C Liens. Buyer shall not directly or indirectly cause, create, incur, assume or allow to exist any mortgage, pledge,
lien, charge, security interest, encumbrance or other claim of any nature on or with respect to the System or any
interest therein. Buyer shall immediately notify Seller in writing of the existence of any such mortgage, pledge, lien,
charge, security interest, encumbrance or other claim, shall promptly cause the same to be discharged and released
of record without cost to Seller, and shall indemnify Seller against all costs and expenses (including reasonable
11426556x2
attorneys' fees) incurred in discharging and releasing any such mortgage, pledge, lien, charge, security interest,
encumbrance or other claim.
g. Security. Buyer shall be responsible for maintaining the physical security of the System and for any damage or
vandalism to the System as a result of its failure to maintain such security. Buyer will not conduct activities on, in
or about the Premises or the Facility that have a reasonable likelihood of causing damage, impairment or otherwise
adversely affecting the System. Buyer shall provide and take reasonable measures for the security of the System,
including commercially reasonable monitoring of the Facility's alarms.
h. Insolation. Buyer understands that unobstructed access to sunlight ("Insolation") is essential to Seller's
performance of its obligations and a material term of this Agreement. Buyer shall not in any way cause and, where
possible, shall not in any way permit any interference with the System's Insolation. If Buyer becomes aware of any
activity or condition that could diminish the Insolation of the System, Buyer shall notify Seller immediately and
shall cooperate with Seller in preserving the System's existing Insolation levels. The Parties agree that reducing
Insolation would irreparably injure Seller, that such injury may not be adequately compensated by an award of
money damages, and that Seller is entitled to seek specific enforcement of this Section 8(h) against Buyer.
i. Data Line. Buyer will allow Seller to use the facility Wi-Fi or intemet lines to connect a data recording/measuring
device.
j. Breakdown Notice. Buyer shall notify Seller within twenty-four (24) hours following the discovery by it of (i) any
material malfunction in the operation of the System; or (ii) any occurrences that could reasonably be expected to
adversely affect the System. Buyer shall notify Seller immediately upon (x) an interruption in the supply of
electrical energy from the System; or (y) the discovery of an emergency condition respecting the System. Buyer and
Seller shall each designate personnel and establish procedures such that each Party may provide notice of such
conditions requiring Seller's repair or alteration at all times, including weekends and holidays.
OW'
9. Chance in Law.
"Change in Law" means (i) the enactment, adoption, promulgation, modification or repeal after the Effective Date of any
applicable law or regulation; (ii) the imposition of any material conditions on the issuance or renewal of any applicable
permit after the Effective Date of this Agreement (notwithstanding the general requirements contained in any applicable
Permit at the time of application or issue to comply with future laws, ordinances, codes, rules, regulations or similar
legislation), or (iii) a change in any utility rate schedule or tariff approved by any Governmental Authority which in the case
of any of (i), (ii) or (iii), establishes requirements affecting owning, supplying, constructing, installing, operating or
maintaining the System, or other performance of the Seller's obligations hereunder and which has a material adverse effect
on the cost to Seller of performing such obligations.
If any Change in Law occurs that has a material adverse effect on the cost to Seller of performing its obligations under this
Agreement, then the Parties shall, within thirty (30) days following receipt by Buyer from Seller of notice of such Change in
Law, meet and attempt in good faith to negotiate amendments to this Agreement as are reasonably necessary to preserve the
economic value of this Agreement to both Parties. If the Parties are unable to agree upon such amendments within such
thirty (30) day period, then Seller shall have the right to terminate this Agreement without further liability to either Party
except with respect to payment of amounts accrued prior to termination.
10. Relocation of System. If Buyer ceases to conduct business operations at and/or vacates the Facility or is prevented from
operating the System at the Facility prior to the expiration of the Term, Buyer shall have the option to provide Seller with a
mutually agreeable substitute premises located within the same Utility district as the terminated System. Buyer shall provide
written notice at least sixty (60) days but not more than one hundred eighty (180) days prior to the date that it wants to make
this substitution. In connection with such substitution, Buyer shall execute an amended agreement that shall have all of the
same terms as this Agreement except for the (i) Effective Date; (ii) License, which will be amended to grant rights in the real
property where the System relocated to; and (iii) Term, which will be the remainder of the Term of this Agreement and such
amended agreement shall be deemed to be a continuation of this Agreement without termination. Buyer shall also provide
any new Buyer, owner, Seller or mortgagee consents or releases required by Seller or Seller's Financing Parties in connection
with the substitute facility. Buyer shall pay all costs associated with relocation of the System, including all costs and
expenses incurred by or on behalf of Seller in connection with removal of the System from the Facility and installation and
testing of the System at the substitute facility and all applicable interconnection fees and expenses at the substitute facility
Section 4. Seller shall remove the System from the vacated Facility prior to the termination of Buyer's ownership, lease or
other rights to use such Facility. Seller will not be required to restore the Facility to its prior condition but shall promptly pay
Buyer for any damage caused by Seller during removal of the System, but not for normal wear and tear. If the substitute
facility has inferior Insolation as compared to the original Facility, Seller shall have the right to make an adjustment to
11426556x2
Exhibit I such that Buyer's payments to Seller are the same as if the System were located at the original Facility. If Buyer is
unable to provide such substitute facility and to relocate the System as provided, any early termination will be treated as a
default by Buyer.
11. Removal of System at Expiration.
Upon the expiration or earlier termination of this Agreement (provided Buyer does not exercise its purchase option), Seller
shall remove all of its tangible property comprising the System from the Facility on a mutually convenient date, but in no
event later than ninety (90) days after the expiration of the Term. Such removal shall be at Seller's expense unless the
termination is due to a Buyer default. Excluding ordinary wear and tear, the Facility shall be returned to its original condition
including the removal of System mounting pads or other support structures. In no case shall Seller's removal of the System
affect the integrity of Buyer's roof, which shall be as leak proof as it was prior to removal of the System and shall be flashed
and/or patched to existing roof specifications. Seller shall leave the Facility in neat and clean order. If Seller fails to remove
or commence substantial efforts to remove the System by such agreed upon date, Buyer shall have the right, at its option, to
remove/dispose the System and restore the Facility to its original condition (other than ordinary wear and tear) at Seller's
cost. Buyer shall provide sufficient space for the temporary storage and staging of tools, materials and equipment and for the
parking of construction crew vehicles and temporary construction trailers and facilities reasonably necessary during System
removal.
12. Measurement.
Seller shall have the right to measure electricity generated by the System using a monitoring system installed and maintained
by Seller as part of the System.
13. Default, Remedies and Damages.
a. Default. Any Party that fails to perform its responsibilities as listed below or experiences any of the circumstances
listed below shall be deemed a "Defaulting Party" and each event of default shall be a "Default Event":
(1) failure of a Party to pay any amount due and payable under this Agreement, other than an amount
that is subject to a good faith dispute, within ten (10) days following receipt of written notice from
the other Party (the "Non -Defaulting Party") of such failure to pay ("Payment Default");
(2) failure of a Party to substantially perform any other material obligation under this Agreement
within thirty (30) days following receipt of written notice from the Non -Defaulting Party
demanding such cure; provided, that such thirty (30) day cure period shall be extended (but not
beyond ninety (90) days) if and to the extent reasonably necessary to cure the Default Event, if (i)
the Defaulting Party initiates such cure within the thirty (30) day period and continues such cure to
completion and (ii) there is no material adverse affect on the Non -Defaulting Party resulting from
the failure to cure the Default Event;
(3) if any representation or warranty of a Party proves at any time to have been incorrect in any
material respect when made and is material to the transactions contemplated hereby, if the effect
of such incorrectness is not cured within thirty (30) days following receipt of written notice from
the Non -Defaulting Party demanding such cure;
(4) Buyer loses its rights to occupy and enjoy the Premises unless due to condemnation;
(5) a Party, or its guarantor, becomes insolvent or is a party to a bankruptcy, reorganization,
insolvency, liquidation, receivership, dissolution, winding -up or relief of debtors, or any general
assignment for the benefit of creditors or other similar arrangement or any event occurs or
proceedings are taken in any jurisdiction with respect to the Party which has a similar effect (or, if
any such actions are initiated by a third party, such action(s) is(are) not dismissed within ninety
(90) days); or
(6) Buyer prevents Seller from installing the System or otherwise failing to perform in a way that
prevents the delivery of electric energy from the System. Such Default Event shall not excuse
Buyer's obligations to make payments that otherwise would have been due under this Agreement.
9
11426556x2
b. Remedies.
(1) Remedies for Payment Default. If a Payment Default occurs, the Non -Defaulting Party may
suspend performance of its obligations under this Agreement. Further, the Non -Defaulting Party
may pursue any remedy under this Agreement, at law or in equity, including an action for damages
and termination of this Agreement, upon ten (10) days prior written notice to the Defaulting Party
following the Payment Default.
(2) Remedies for Other Defaults. On the occurrence of a Default Event other than a Payment Default,
the Non -Defaulting Party may pursue any remedy under this Agreement, at law or in equity,
including an action for damages and termination of this Agreement or suspension of performance
of its obligations under this Agreement, upon five (5) days prior written notice to the Defaulting
Party following the occurrence of the Default Event. Nothing herein shall limit either Party's right
to collect damages upon the occurrence of a breach or a default by the other Party that does not
become a Default Event. If Buyer terminates this contract without cause prior to System
Installation a $5,000 design cancellation fee shall also apply in addition to any other remedy
available to Seller.
(3) Damages Upon Termination by Default. Upon a termination of this Agreement by the Non -
Defaulting Party as a result of a Default Event by the Defaulting Party, the Defaulting Party shall
pay a Termination Payment to the Non -Defaulting Party determined as follows (the "Termination
Payment"):
Buyer. If Buyer is the Defaulting Party and Seller terminates this Agreement, the
Termination Payment to Seller shall be equal to the sum of:
(i) reasonable compensation, on a net after tax basis assuming a tax rate of 35%, for the
loss or recapture of:
(A) the investment tax credit equal to thirty percent (30%) of the System value;
(B) MACRS accelerated depreciation equal to eighty five percent (85%) of the System
value, and
(C) other financing and associated costs not included in (A) and (B);
(ii) (A) the net present value of the projected payments over the Term post -termination,
had the Term remained effective for the full Initial Term, and (B) the net present value of
lost sales of any Environmental Attributes or Environmental Incentives (including the
State of Minnesota's Made in Minnesota Solar PV Production Based Incentives) that
accrue or are otherwise assigned to Seller pursuant to the terms of this Agreement over
the Term post -termination, had the Term remained effective for the full Initial Term
(Seller shall furnish Buyer with a detailed calculation of such compensation if such a
claim is made);
(iii) removal costs as provided in Section 13(b)(3)(Ch; and
(iv) any and all other amounts previously accrued under this Agreement and then owed
by Buyer to Seller.
The Parties agree that actual damages to Seller in the event this Agreement terminates
prior to the expiration of the Term as the result of a Default Event by Buyer would be
difficult to ascertain, and the applicable Termination Payment is a reasonable
approximation of the damages suffered by Seller as a result of early termination of this
Agreement. The Termination Payment shall not be less than zero.
A. Seller. If Seller is the Defaulting Party and Purchaser terminates this Agreement, the
Termination Payment to Purchaser shall be equal to the sum of (i) the present value
(using a discount rate of 9.5%) of the excess, if any, of the reasonably expected cost of
electric energy from the Utility over the Contract Price for the reasonably expected
production of the System for the remainder of the Initial Term or the then current
Additional Term, as applicable; (ii) all costs reasonably incurred by Purchaser in re-
converting its electric supply to service from the Utility; (iii) any removal costs incurred
by Purchaser, and (iv) any and all other amounts previously accrued under this
Agreement and then owed by Seller to Purchaser. The Termination Payment shall not be
less than zero.
10
11426556x2
B. Obligations Following Termination. If a Non -Defaulting Party terminates this
Agreement pursuant to this Section 13(b1 then following such termination, Seller shall,
at the sole cost and expense of the Defaulting Party, remove the equipment constituting
the System. The Non -Defaulting Party shall take all commercially reasonable efforts to
mitigate its damages as the result of a Default Event.
14. Representations and Warranties.
a. General Representations and Warranties. Each Party represents and warrants to the other the following:
(1) Such Party is duly organized, validly existing and in good standing under the laws of the
jurisdiction of its formation; the execution, delivery and performance by such Party of this
Agreement have been duly authorized by all necessary corporate, partnership or limited liability
company action, as applicable, and do not and shall not violate any law; and this Agreement is
valid obligation of such Party, enforceable against such Party in accordance with its terms (except
as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium and other
similar laws now or hereafter in effect relating to creditors' rights generally).
(2) Such Party has obtained all licenses, authorizations, consents and approvals required by any
Governmental Authority or other third party and necessary for such Party to own its assets, carry
on its business and to execute and deliver this Agreement; and such Party is in compliance with all
laws that relate to this Agreement in all material respects.
b. Buyer's Representations and Warranties. Buyer represents and warrants to Seller the following:
(1) License. Buyer has title to or a leasehold or other property interest in the Premises. Buyer has the
full right, power and authority to grant the License contained in Section 8(a). Such grant of the
License does not violate any law, ordinance, rule or other governmental restriction applicable to
Buyer or the Facility and is not inconsistent with and will not result in a breach or default under
any agreement by which Buyer is bound or that affects the Facility. If Buyer does not own the
Premises or Facility, Buyer has obtained all required consents from the owner of the Premises
and/or Facility to grant the License and enter into and perform its obligations under this
Agreement.
(2) Other Agreements. Neither the execution and delivery of this Agreement by Buyer nor the
performance by Buyer of any of its obligations under this Agreement conflicts with or will result
in a breach or default under any agreement or obligation to which Buyer is a party or by which
Buyer or the Facility is bound.
(3) Accuracy of Information. All information provided by Buyer to Seller, as it pertains to the
Facility's physical configuration, Buyer's planned use of the Facility, and Buyer's estimated
electricity requirements, is accurate in all material respects.
(4) Buyer Status. Buyer is not a public utility or a public utility holding company and is not subject to
regulation as a public utility or a public utility holding company.
(5) No Pool Use. No electricity generated by the System will be used to heat a swimming pool.
15. System and Facility Damage and Insurance.
a. System and Facility Damage.
(1) Seller's Obli atg ions. If the System is damaged or destroyed other than by Buyer's gross
negligence or willful misconduct, Seller shall promptly repair and restore the System to its pre-
existing condition; provided, however, that if more than fifty percent (50%) of the System is
destroyed during the last five (5) years of the Initial Term or during any Additional Term, Seller
shall not be required to restore the System, but may instead terminate this Agreement, unless
Buyer agrees (i) to pay for the cost of such restoration of the System or (ii) to purchase the System
"AS -IS" at the greater of (A) then current fair market value of the System and (B) the sum of the
amounts described in Section 0)(i) (using the date of purchase to determine the appropriate
Contract Year) and Section 0)(iii).
11
11426556x2
(2) Buyer's Obligations. If the Facility is damaged or destroyed by casualty of any kind or any other
occurrence other than Seller's gross negligence or willful misconduct, such that the operation of
the System and/or Buyer's ability to accept the electric energy produced by the System are
materially impaired or prevented, Buyer shall promptly repair and restore the Facility to its pre-
existing condition; provided, however, that if more than 50% of the Facility is destroyed during
the last five years of the Initial Term or during any Additional Term, Buyer may elect either (i) to
restore the Facility or (ii) to pay the Termination Payment and all other costs previously accrued
but unpaid under this Agreement and thereupon terminate this Agreement.
b. Insurance Coverage. At all times during the Term, Seller and Buyer shall maintain the following insurance:
Seller's Insurance. Seller shall maintain (i) property insurance on the System for the replacement cost
thereof, (ii) commercial general liability insurance with coverage of at least $1,000,000 per occurrence and
$2,000,000 annual aggregate, (iii) employer's liability insurance with coverage of at least $1,000,000 and
(iv) workers' compensation insurance as required by law. Seller shall cause Buyer to be named as an
Additional Insured on all policies provided by Seller.
ii. Buyer's Insurance. Buyer shall maintain commercial general liability insurance with coverage of at least
$500,000 per occurrence and $1,500,000 annual aggregate.
C. Policy Provisions. All insurance policies provided hereunder shall (i) contain a provision whereby the insurer
agrees to give the Party not providing the insurance thirty (30) days (ten (10) days in the event of non-payment of
premiums) written notice before the insurance is cancelled, or terminated, (ii) be written on an occurrence basis, (iii)
be maintained with companies either rated no less than A -VII as to Policy Holder's Rating in the current edition of
A.M. Best's Insurance Guide or otherwise reasonably acceptable to the other Party.
d. Certificates. Upon the other Party's request each Party shall deliver the other Party certificates of insurance
evidencing the above required coverage. A Party's receipt, review or acceptance of such certificate shall in no way
limit or relieve the other Party of the duties and responsibilities to maintain insurance as set forth in this Agreement.
e. Deductibles. Unless and to the extent that a claim is covered by an indemnity set forth in this Agreement, each
Parry shall be responsible for the payment of its own deductibles.
12
11426556x2
16. Ownership; Option to Purchase.
a. Ownership of System. Throughout the Term, Seller shall be the legal and beneficial owner of the System at all
times, including all Environmental Attributes and Environmental Incentives, and the System shall remain the
personal property of Seller and shall not attach to or be deemed a part of, or fixture to, the Facility or the Premises.
Each of the Seller and Buyer agree that the Seller is the tax owner of the System and all tax filings and reports will
be filed in a manner consistent with this Agreement. The System shall at all times retain the legal status of personal
property as defined under Article 9 of the Uniform Commercial Code. Buyer covenants that it will use
commercially reasonable efforts to place all parties having an interest in or a mortgage, pledge, lien, charge, security
interest, encumbrance or other claim of any nature on the Facility or the Premises on notice of the ownership of the
System and the legal status or classification of the System as personal property. If there is any mortgage or fixture
filing against the Premises which could reasonably be construed as prospectively attaching to the System as a fixture
of the Premises, Buyer shall provide a disclaimer or release from such lienholder. If Buyer is the fee owner of the
Premises, Buyer consents to the filing of a disclaimer of the System as a fixture of the Premises in the office where
real estate records are customarily filed in the jurisdiction where the Facility is located. If Buyer is not the fee
owner, Buyer will obtain such consent from such owner. For the avoidance of doubt, in either circumstance Seller
shall file such disclaimer. Upon request, Buyer agrees to deliver to Seller a non -disturbance agreement in a form
reasonably acceptable to Seller from the owner of the Facility (if the Facility is leased by Buyer), any mortgagee
with a lien on the Premises, and other Persons holding a similar interest in the Premises. To the extent that Buyer
does not own the Premises or Facility, Buyer shall provide to Seller immediate written notice of receipt of notice of
eviction from the Premises or Facility or termination of Buyer's lease of the Premises and/or Facility.
b. Option to Purchase. At the end of the sixth (6th) and tenth (10th) Contract Years and at the end of the Term,
so long as Buyer is not in default under this Agreement, Buyer may purchase the System from Seller on any
such date for a purchase price equal to the Fair Market Value of the System. The "Fair Market Value" of the
System shall be determined by mutual agreement of Buyer and Seller; provided, however, if Buyer and Seller cannot
agree to a Fair Market Value within thirty (30) days after Buyer has exercised its option, the Parties shall select a
nationally recognized independent appraiser with experience and expertise in the solar photovoltaic industry to
determine the Fair Market Value of the System. Such appraiser shall act reasonably and in good faith to determine
the Fair Market Value of the System on an installed basis and shall set forth such determination in a written opinion
delivered to the Parties; provided that in no event shall the Fair Market Value be less than the sum of the amounts
calculated under Sections 13(b)(3)(A) and (B) as of the date of System title transfer. The valuation made by the
appraiser shall be binding upon the Parties in the absence of fraud or manifest error. The costs of the appraisal shall
be borne by the Parties equally. Buyer must provide a notification to Seller of its intent to purchase at least ninety
(90) days and not more than one hundred eighty (180) days prior to the end of the applicable Contract Year or the
Term, as applicable, and the purchase shall be complete prior to the end of the applicable Contract Year or the Term,
as applicable. Upon purchase of the System, Buyer will assume complete responsibility for the operation and
maintenance of the System and liability for the performance of the System, and Seller shall have no further liabilities
or obligations hereunder.
17. Indemnification and Limitations of Liability.
a. General. Each Party (the "Indemnifying Party") shall defend, indemnify and hold harmless the other Party and the
directors, officers, shareholders, partners, members, agents and employees of such other Party, and the respective
affiliates of each thereof (collectively, the "Indemnified Parties"), from and against all loss, damage, expense,
liability and other claims, including court costs and reasonable attorneys' fees (collectively, "Liabilities") resulting
from any third party claims relating to the breach of any representation or warranty set forth in Section 14 and from
injury to or death of persons, and damage to or loss of property to the extent caused by or arising out of the negligent
acts or omissions of, or the willful misconduct of, the Indemnifying Party (or its contractors, agents or employees) in
connection with this Agreement; provided, however, that nothing herein shall require the Indemnifying Party to
indemnify the Indemnified Party for any Liabilities to the extent caused by or arising out of the negligent acts or
omissions of, or the willful misconduct of, the Indemnified Party. This Section 17(a) however, shall not apply to
liability arising from any form of Hazardous Substances or other environmental contamination, such matters being
addressed exclusively by Section 17(c).
b. Notice and Participation in Third Party Claims. The Indemnified Party shall give the Indemnifying Party written
notice with respect to any Liability asserted by a third party (a "Claim"), as soon as possible upon the receipt of
information of any possible Claim or of the commencement of such Claim. The Indemnifying Party may assume the
defense of any Claim, at its sole cost and expense, with counsel designated by the Indemnifying Party and
reasonably satisfactory to the Indemnified Party. The Indemnified Party may, however, select separate counsel if
both Parties are defendants in the Claim and such defense or other form of participation is not reasonably available
13
11426556x2
to the Indemnifying Party. The Indemnifying Party shall pay the reasonable attorneys' fees incurred by such
separate counsel until such time as the need for separate counsel expires. The Indemnified Party may also, at the
sole cost and expense of the Indemnifying Party, assume the defense of any Claim if the Indemnifying Party fails to
assume the defense of the Claim within a reasonable time. Neither Party shall settle any Claim covered by this
Section 177(b) unless it has obtained the prior written consent of the other Party, which consent shall not be
unreasonably withheld or delayed. The Indemnifying Party shall have no liability under this Section 177(b) for any
Claim for which such notice is not provided if that the failure to give notice prejudices the Indemnifying Party.
C. Environmental Indemnification. Seller shall indemnify, defend and hold harmless all of Buyer's Indemnified
Parties from and against all Liabilities arising out of or relating to the existence at, on, above, below or near the
Premises of any Hazardous Substance (as defined below) to the extent deposited, spilled or otherwise caused by
Seller or any of its contractors or agents. Buyer shall indemnify, defend and hold harmless all of Seller's
Indemnified Parties from and against all Liabilities arising out of or relating to the existence at, on, above, below or
near the Premises of any Hazardous Substance, except to the extent deposited, spilled or otherwise caused by Seller
or any of its contractors or agents. Each Party shall promptly notify the other Party if it becomes aware of any
Hazardous Substance on or about the Premises generally or any deposit, spill or release of any Hazardous Substance.
"Hazardous Substance" means any chemical, waste or other substance (i) which now or hereafter becomes defined
as or included in the definition of "hazardous substances," "hazardous wastes," "hazardous materials," "extremely
hazardous wastes," "restricted hazardous wastes," "toxic substances," "toxic pollutants," "pollution," "pollutants,"
"regulated substances," or words of similar import under any laws pertaining to the environment, health, safety or
welfare, (ii) which is declared to be hazardous, toxic, or polluting by any Governmental Authority, (iii) exposure to
which is now or hereafter prohibited, limited or regulated by any Governmental Authority, (iv) the storage, use,
handling, disposal or release of which is restricted or regulated by any Governmental Authority, or (v) for which
remediation or cleanup is required by any Governmental Authority.
18. Force Maieure.
a. "Force Majeure" means any event or circumstances beyond the reasonable control of and without the fault or
negligence of the Party claiming Force Majeure. It shall include, without limitation, failure or interruption of the
production, delivery or acceptance of electricity due to: an act of god; war (declared or undeclared); sabotage; riot;
insurrection; civil unrest or disturbance; military or guerilla action; terrorism; economic sanction or embargo; civil
strike, work stoppage, slow -down, or lock -out; explosion; fire; earthquake; abnormal weather condition or actions of
the elements; hurricane; flood; lightning; wind; drought; the binding order of any Governmental Authority (; the
failure to act on the part of any Governmental Authority (; unavailability of electricity from the utility grid,
equipment, supplies or products; and failure of equipment not utilized by or under the control of the Party claiming
Force Majeure.
b. Except as otherwise expressly provided to the contrary in this Agreement, if either Party is rendered wholly or partly
unable to timely perform its obligations under this Agreement because of a Force Majeure event, that Party shall be
excused from the performance affected by the Force Majeure event (but only to the extent so affected) and the time
for performing such excused obligations shall be extended as reasonably necessary; provided, that: (i) the Party
affected by such Force Majeure event, as soon as reasonably practicable after obtaining knowledge of the occurrence
of the claimed Force Majeure event, gives the other Party prompt oral notice, followed by a written notice
reasonably describing the event; (ii) the suspension of or extension of time for performance is of no greater scope
and of no longer duration than is required by the Force Majeure event; and (iii) the Party affected by such Force
Majeure event uses all reasonable efforts to mitigate or remedy its inability to perform as soon as reasonably
possible. The Term shall be extended day for day for each day performance is suspended due to a Force Majeure
event.
19. Assignment and Financing.
a. Assignment. This Agreement may not be assigned in whole or in part by either Party without the prior written
consent of the other Party, which consent shall not be unreasonably withheld or delayed. In the event of assignment
request by seller, City of Scandia retains the right to first refusal to all assisgnments. Notwithstanding the foregoing,
Seller may, without the prior written consent of Buyer, (i) assign, mortgage, pledge or otherwise collaterally assign
its interests in this Agreement to any Financing Party, (ii) directly or indirectly assign this Agreement to an affiliate
of Seller, (iii) assign this Agreement to any entity through which Seller is obtaining financing or capital for the
System and (iv) assign this Agreement to any person succeeding to all or substantially all of the assets of Seller
(provided that Seller shall be released from liability hereunder as a result of any of the foregoing permitted
assignments only upon assumption of Seller's obligations hereunder by the assignee and buyers approval of
assignee). Buyer's consent to any other assignment shall not be unreasonably withheld if Buyer has been provided
14
11426556x2
with reasonable proof that the proposed assignee (x) has comparable experience in operating and maintaining
photovoltaic solar systems comparable to the System and providing services comparable to those contemplated by
this Agreement and (y) has the financial capability to maintain the System and provide the services contemplated by
this Agreement in the manner required by this Agreement. This Agreement shall be binding on and inure to the
benefit of the successors and permitted assignees.
b. Financing. The Parties acknowledge that Seller may obtain construction and long-term financing or other credit
support from lenders or third parties (including tax equity or similar investors) ("Financing Parties") in connection
with the installation, construction, ownership, operation and maintenance of the System. Both Parties agree in good
faith to consider and to negotiate changes or additions to this Agreement that may be reasonably requested by the
Financing Parties; provided, that such changes do not alter the fundamental economic terms of this Agreement. The
Parties also agree that Seller may assign this Agreement to the Financing Parties as collateral, and in connection
with any such assignment, Buyer agrees to execute a consent to assignment in customary form and reasonably
acceptable to the Financing Parties.
20. Confidentiality and Publicity.
a. Confidentiality. If either Party provides confidential information, including business plans, strategies, financial
information, proprietary, patented, licensed, copyrighted or trademarked information, and/or technical information
regarding the design, operation and maintenance of the System or of Buyer's business ("Confidential
Information") to the other or, if in the course of performing under this Agreement or negotiating this Agreement a
Party learns Confidential Information regarding the facilities or plans of the other, the receiving Party shall (i)
protect the Confidential Information from disclosure to third parties with the same degree of care accorded its own
confidential and proprietary information, and (ii) refrain from using such Confidential Information, except in the
negotiation and performance of this Agreement. Notwithstanding the above, a Party may provide such Confidential
Information to its, officers, directors, members, managers, employees, agents, contractors and consultants
(collectively, "Representatives"), and affiliates, lenders, and potential assignees of this Agreement (provided and
on condition that such potential assignees be bound by a written agreement or legal obligation restricting use and
disclosure of Confidential Information), in each case whose access is reasonably necessary to the negotiation and
performance of this Agreement. All Confidential Information shall remain the property of the disclosing Party and
shall be returned to the disclosing Party or destroyed after the receiving Party's need for it has expired or upon the
request of the disclosing Party. Each Party agrees that the disclosing Party would be irreparably injured by a breach
of this Section 20ta) by the receiving Party or its Representatives or other person to whom the receiving Party
discloses Confidential Information of the disclosing Party and that the disclosing Party may be entitled to equitable
relief, including injunctive relief and specific performance, in the event of a breach of the provision of this Section
20(a).
b. Permitted Disclosures. Notwithstanding any other provision in this Agreement, neither Party shall be required to
hold confidential any information that (i) becomes publicly available other than through the receiving Party, (ii) is
required to be disclosed to a Governmental Authority under applicable law or pursuant to a validly issued subpoena
(but a receiving Party subject to any such requirement shall promptly notify the disclosing Party of such requirement
to the extent permitted by applicable law), (iii) is independently developed by the receiving Party, (iv) becomes
available to the receiving Party without restriction from a third party under no obligation of confidentiality, or (v) is
required to be disclosed under the Minnesota Governmental Data Practices Act. If disclosure of information is
required by a Governmental Authority, the disclosing Party shall, to the extent permitted by applicable law, notify
the other Party of such required disclosure promptly upon becoming aware of such required disclosure and shall
cooperate with the other Party in efforts to limit the disclosure to the maximum extent permitted by law.
21. Goodwill and Publicity. Neither Party shall use any name, trade name, service mark or trademark of the other Party in any
promotional or advertising material without the prior written consent of such other Party. The Parties shall coordinate and
cooperate with each other when making public announcements related to the execution and existence of this Agreement,
Neither Party shall make any press release or public announcement of the specific terms of this Agreement (except for filings
or other statements or releases as may be required by applicable law) without the specific prior written consent of the other
Party.
22. General Provisions
a. Choice of Law. The law of the state where the System is located shall govern this Agreement without giving effect
to conflict of laws principles.
15
11426556x2
b. Arbitration and Attorneys' Fees. Any dispute arising from or relating to this Agreement shall be arbitrated in
Minneapolis, Minnesota. The arbitration shall be administered by JAMS in accordance with its Comprehensive
Arbitration Rules and Procedures, and judgment on any award may be entered in any court of competent
jurisdiction. If the Parties agree, a mediator may be consulted prior to arbitration. The prevailing Party in any
dispute arising out of this Agreement shall be entitled to reasonable attorneys' fees and costs.
C. Notices. All notices under this Agreement shall be in writing and shall be by personal delivery, facsimile
transmission, electronic mail, overnight courier, or regular, certified, or registered mail, return receipt requested, and
deemed received upon personal delivery, confirmation of transmission of facsimile, acknowledgment of receipt of
electronic transmission, the promised delivery date after deposit with overnight courier, or five (5) days after deposit
in the mail, as applicable. Notices shall be sent to the person identified in this Agreement at the addresses set forth
in this Agreement or such other address as either Party may specify in writing. Each Party shall deem a document
faxed, emailed or electronically sent in PDF form to it as an original document.
d. Survival. Provisions of this Agreement that should reasonably be considered to survive termination of this
Agreement shall survive such termination. For the avoidance of doubt, surviving provisions shall include, without
limitation, Section 14 (Representations and Warranties), Section 7(i) (No Warranty), Section 15 (Insurance
Coverage), Section 17 (Indemnification and Limits of Liability), Section 20 (Confidentiality and Publicity), Section
22(a) (Choice of Law), Section 22(b) (Arbitration and Attorneys' Fees), Section 22(c) (Notices), Section 22(g)
(Comparative Negligence), Section 22(h) (Non -Dedication of Facilities), Section 220) (No Partnership) Section
22(k) (Full Agreement, Modification, Invalidity, Counterparts, Captions) and Section 22(1) (No Third Party
Beneficiaries).
e. Further Assurances. Each of the Parties hereto agree to provide such information, execute and deliver any
instruments and documents and to take such other actions as may be necessary or reasonably requested by the other
Party which are not inconsistent with the provisions of this Agreement and which do not involve the assumptions of
obligations other than those provided for in this Agreement, to give full effect to this Agreement and to carry out the
intent of this Agreement.
E Right of Waiver. Each Party, in its sole discretion, shall have the right to waive, defer or reduce any of the
requirements to which the other Party is subject under this Agreement at any time; provided, however that neither
Party shall be deemed to have waived, deferred or reduced any such requirements unless such action is in writing
and signed by the waiving Party. No waiver will be implied by any usage of trade, course of dealing or course of
performance. A Party's exercise of any rights hereunder shall apply only to such requirements and on such
occasions as such Party may specify and shall in no event relieve the other Party of any requirements or other
obligations not so specified. No failure of either Party to enforce any term of this Agreement will be deemed to be a
waiver. No exercise of any right or remedy under this Agreement by Buyer or Seller shall constitute a waiver of any
other right or remedy set forth herein or provided by law. Any delay or failure of a Party to exercise, or any partial
exercise of, its rights and remedies under this Agreement shall not operate to limit or otherwise affect such rights or
remedies. Any waiver of performance under this Agreement shall be limited to the specific performance waived and
shall not, unless otherwise expressly stated in writing, constitute a continuous waiver or a waiver of future
performance.
g. Comparative Negligence. It is the intent of the Parties that where negligence is determined to have been joint,
contributory or concurrent, each Party shall bear the proportionate cost of any Liability.
h. Non -Dedication of Facilities. Nothing herein shall be construed as the dedication by either Party of its facilities or
equipment to the public or any part thereof. Neither Party shall knowingly take any action that would subject the
other Party, or other Party's facilities or equipment, to the jurisdiction of any Governmental Authority as a public
utility or similar entity. Neither Party shall assert in any proceeding before a court or regulatory body that the other
Party is a public utility by virtue of such other Party's performance under this agreement. If Seller is reasonably
likely to become subject to regulation as a public utility, then the Parties shall use all reasonable efforts to
restructure their relationship under this Agreement in a manner that preserves their relative economic interests while
ensuring that Seller does not become subject to any such regulation. If the Parties are unable to agree upon such
restructuring, Seller shall have the right to terminate this Agreement without further liability, and Seller shall
remove the System in accordance with Section 11 of this Agreement.
i. Estoppel. Either Party hereto, without charge, (at a maximum of twice per year), within 10 business days after
receipt of a written request by the other Party hereto, shall deliver a written instrument, duly executed, certifying to
such requesting Party, or any other person specified by such requesting Party: (i) that this Agreement is unmodified
and in full force and effect, or if there has been any modification, that the same is in full force and effect as so
16
11426556x2
modified, and identifying any such modification; (ii) whether or not to the knowledge of any such Party there are
then existing any offsets or defenses in favor of such Party against enforcement of any of the terms, covenants and
conditions of this Agreement and, if so, specifying the same and also whether or not to the knowledge of such Party
the other Party has observed and performed all of the terms, covenants and conditions on its part to be observed and
performed, and if not, specifying the same; and (iii) such other information as may be reasonably requested by the
requesting Party. Any written instrument given hereunder may be relied upon by the recipient of such instrument,
except to the extent the recipient has actual knowledge of facts contained in the certificate.
j. No Partnership. No provision of this Agreement shall be construed or represented as creating a partnership, trust,
joint venture, fiduciary or any similar relationship between the Parties. No Party is authorized to act on behalf of the
other Party, and neither shall be considered the agent of the other.
k. Full Asreement, Modification, Invalidity, Counterparts, Captions. This Agreement, together with any Exhibits,
completely and exclusively states the agreement of the parties regarding its subject matter and supersedes all prior
proposals, agreements, or other communications between the parties, oral or written, regarding its subject matter.
This Agreement may be modified only by a writing signed by both Parties. If any provision of this Agreement is
found unenforceable or invalid, such unenforceability or invalidity shall not render this Agreement unenforceable or
invalid as a whole. In such event, such provision shall be changed and interpreted so as to best accomplish the
objectives of such unenforceable or invalid provision within the limits of applicable law. This Agreement may be
executed in any number of separate counterparts and each counterpart shall be considered an original and together
shall comprise the same Agreement. The captions or headings in this Agreement are strictly for convenience and
shall not be considered in interpreting this Agreement.
1. No Third Party Beneficiaries. Except as otherwise expressly provided herein, this Agreement and all rights
hereunder are intended for the sole benefit of the Parties hereto and shall not imply or create any rights on the part
of, or obligations to, any other Person.
End of Exhibit 4
17
11426556x2