THE ENERGY NETWORK, INC.
AND
THE CITY OF HARTFORD
DISTRICT HEATING & COOLING SERVICE AGREEMENT
Subject to the terms and conditions set forth in this Service
Agreement ("Agreement"), The Energy Network, Inc. ("Seller"), a
Connecticut corporation with a place of business at 000 Xxxxxxxx
Xxxxxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, and the City of Hartford
("Purchaser"), a municipal corporation with its place of business
at 000 Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, agree as follows:
Premises: Montessori Magnet School
Middle School
Math, Science and Arts High School
Commons Building
Theatre
Parking Garage and Retail Space
All located between Vernon, Brownell, Broad and Washington Streets
in the City of Hartford (known as The Learning Corridor), as more
particularly described in Exhibit A-1 attached hereto.
Term commences on the Heating Cut-Over Date shown on Exhibit C and
ends on a date twenty-five (25) years later.
Energy Products:
---------------
/X/ Chilled Water
/ / Steam
/X/ Hot Water
1. AGREEMENT TO PURCHASE AND SELL.
a. PURCHASE. Provided Purchaser shall have executed and
delivered easements (the "Easements" for access, construction,
maintenance and service substantially in the form attached hereto
as Exhibit A, which Easements Purchaser agrees to execute and
deliver, and subject to and in accordance with the terms and
conditions of this Agreement, Seller shall supply to Purchaser, and
Purchaser shall purchase from Seller, all of the Energy Products
(as herein defined) required by Purchaser to enable it to heat and
air condition the Premises during the term of this Agreement. All
such Energy Products shall be supplied by Seller in accordance
with the Energy Product Specifications set forth in Exhibit A-2 and
at the rates delineated in Exhibit B, both of which exhibits are
attached hereto and incorporated herein by reference.
b. REQUIREMENTS. Subject to the other terms of this
Agreement, Purchaser agrees that, from the Service Date until the
end of the term of this Agreement, Purchaser will only use
Seller's Energy Products to heat and air condition the Premises,
except that Purchaser shall be entitled to use other means to heat
or air condition discrete portions of the Premises that are
impossible or impracticable to heat or air condition with Seller's
Energy Products. Purchaser shall obtain Seller's written consent
to the use of such other means, such consent not to be unreasonably
withheld or delayed.
c. REPRESENTATIONS. Seller hereby represents, warrants and
agrees that it is the owner of that certain steam facility formerly
known as Hartford Hospital CCF-1 and that it will contract with
Hartford Hospital to purchase certain additional steam capacity
(collectively, the "Steam Facility"), and that it will become the
owner of or obtain the necessary rights to a chilled water facility
(the "Chilled Water Facility"), from which Seller will initially
provide the Energy Products to the Premises. The Steam Facility
and the Chilled Water Facility will have sufficient capacity to
service the Premises and any other uses of Energy Products which
are (or are to be) supplied therefrom. In the event Seller decides
to relocate any of such facilities, it shall then certify to
Purchaser that the new Facilities have available capacity adequate
to service the Project.
2. TERM. The term of this Agreement shall be as indicated
on Page 1.
3. SERVICE INTERRUPTIONS.
a. For purposes of this Agreement, the following terms shall
have the meanings ascribed thereto below:
(i) A "Planned Interruption" shall mean any interruption in
the supply of Energy Products to the Premises which (A)
occurs during a time when Purchaser's heating or cooling
system calls for the interrupted Energy Product, and (B)
meets all of the requirements set forth in subparagraph
(b) below;
(ii) A "Covered Interruption" shall mean a Planned
Interruption for or with respect to which Seller provides
Temporary Service at or for the Premises in accordance
with subparagraph (e) below;
(iii) "Permanent Service" shall mean the supply of Energy
Products to the Premises from one or more permanent
facilities;
(iv) "Temporary Service" shall mean the supply of Energy
Products to the Premises from one or more portable units;
(v) At any time any buildings on the Premises are occupied, a
"Service Failure" shall mean any inability of the Seller
to deliver required Energy Products to the Premises at
the temperatures set forth in Exhibit D and at the flow
rates set forth in Exhibit A-2, provided that Purchaser
was then able to extract energy at the temperature
differential set forth in Exhibit D and at the flow rate
and energy quantities set forth in Exhibit A-2. At all
other times, a "Service Failure" shall mean the inability
by Seller to deliver Energy Products to the Premises at
such temperatures and at such flow rates as are
necessary to avoid any actual, or imminent threat of,
damage to or injury on the Premises (or any persons or
property located thereon or thereat); and
(vi) An "Impermissible Interruption" shall mean any of the
following: (A) any interruption in the supply of required
Energy Products to the Premises other than (1) a Covered
Interruption or (2) a Planned Interruption which
Purchaser agrees does not require Temporary Service, or
(B) any Covered Interruption which nonetheless results in
a Service Failure. Purchaser shall send Seller a written
notice as soon as practicable after the event when it
claims that an Impermissible Interruption has occurred.
b. Subject to the provisions of subparagraphs (e) and 6(a)
below, Seller shall have the right, at all reasonable times, to
interrupt the supply of Energy Products to the Premises for the
purpose of performing necessary maintenance, repairs, and/or
connections to those of its mains, pipes and related machinery and
equipment which service the Premises. Seller's rights as aforesaid
are, and at all times during the term hereof shall be, contingent
upon Seller's providing Purchaser with at least five (5) days'
prior written notice of any such interruption. Seller shall
exercise due diligence and act with reasonable dispatch in
restoring any such service, providing, however, that, to the extent
reasonably practicable, any of the above-described work shall be
(and the reasonableness of any interruption experienced in
connection therewith shall largely be dependant upon such work's
not being able to reasonably be) accomplished during evenings,
weekends and other non-academic hours.
c. Subject to the provisions of subparagraphs (e) and 6(a)
below, Purchaser acknowledges that emergencies may occur which will
require Seller to interrupt the supply of Energy Products to the
Premises before the Seller can provide Purchaser with the notice
required pursuant to Subparagraph (b) above. In such event, Seller
shall notify Purchaser as soon as practicable. Seller shall then
exercise due diligence and act with immediate dispatch to either
(1) restore permanent service, or (2) if such service neither can
nor will be restored in twenty-four (24) hours, provide Temporary
Service, at or for the Premises. Thereafter, Seller shall act with
reasonable dispatch in restoring permanent service to the Premises,
providing, however, that, to the extent reasonably practicable, any
of that work shall be (and the reasonableness of any interruption
experienced in connection therewith shall largely be dependant upon
such work s not being able to reasonably be) accomplished during
evenings, weekends and other non-academic hours.
d. Any notice provided by Seller pursuant to this paragraph
3 shall identify (i) the date and time at which the subject
interruption began (or is scheduled to occur), (ii) the reason(s)
therefor, (iii)the efforts being (or to be) undertaken by Seller to
provide Temporary Service, (iv) the efforts being (or to be)
undertaken by Seller to restore permanent service, (v) the dates
and times during which the efforts to restore permanent service is
to be performed, and (vi) the date and time by which such efforts
are expected to be completed.
e. Seller shall ensure that Temporary Service is available
at or for the Premises prior to implementing any Planned
Interruption whenever Seller knows or should know that, but for
such Temporary Service, a Planned Interruption will result in an
Impermissible Interruption. In the event of any other
interruption, Seller shall ensure that either Temporary Service is
available at or for the Premises, or permanent service will be
restored to the Premises, within twenty-four (24) hours after the
occurrence of such interruption. Seller shall pay Purchaser $1,000
per day for each 24-hour period that Seller fails to provide
Temporary Service as required by this subparagraph. In addition,
Seller shall bear the cost of providing Temporary Service in the
case of an interruption unless the interruption is due principally
to an act or omission of Purchaser and Seller is unable after
reasonable effort to recover the costs associated with providing
Temporary Service from a third party. In any of these latter
circumstances, Purchaser shall be responsible for the cost of such
Temporary Service. In the event Seller fails to provide any
Temporary Service required to be provided hereunder, then
Purchaser, in addition to any other rights and remedies it may
have, all of which are hereby expressly reserved to Purchaser, may
obtain the same from some other source and charge the reasonable
cost thereof to Seller.
4. PAYMENT. Provided that Seller has completed all work
necessary to furnish the Energy Products to The Learning Corridor
(and further provided that such completion has not been prevented
by acts of the Purchaser), and commencing on the Heating Cut-Over
date shown on Exhibit C, Seller shall render a monthly invoice to
Purchaser which reflects (a) the Fixed Payment as defined in
Exhibit B and (b) the appropriate Variable Payment as defined in
Exhibit B, including consumption recorded with respect to each of
the six (6) facilities which comprise the Premises. Purchaser
shall pay in full within thirty (30) days the undisputed portion of
any invoice delivered by Seller.
5. FORCE MAJEURE. Neither Seller nor Purchaser shall be
considered to have breached its obligations under this Agreement to
the extent either is precluded from performing any of its
obligations hereunder by reason of any act, omission or
circumstance occasioned by or in consequence of any acts of God,
acts of the public enemy, wars, blockades, insurrection, riots,
lightning, earthquakes, fires, storms, floods, washouts, arrests,
restraints of ruler and peoples, civil disturbances, explosions,
strikes, breakage or accident to machinery or lines of pipe or
mains, the binding order of any court or government authority which
has been resisted in good faith by all reasonable legal means, or
the failure or want of any necessary supplies or products not
within the control of such party; providing, first, that any such
act, omission or circumstance is not due to the negligence or
willful misconduct of the party seeking to be excused therefrom (or
any of its officers, directors, officials, agents or employees);
and, providing, further, that such party is unable to prevent or
overcome such act, omission or circumstance by the exercise of due
diligence. Such causes or contingencies affecting performance by
Seller or Purchaser, however, shall not relieve either of them of
liability in the event of their concurring negligence or in the
event of their failure to use due diligence to remedy the situation
and remove the cause in an adequate manner and with all reasonable
dispatch.
6. TERMINATION BY PURCHASER.
a. This Agreement is subject to the limitation that,
(i) whenever Seller shall fail to pay any undisputed portions
of amounts which are owed to Purchaser within thirty (30)
days of Purchaser's written demand therefor; or
(ii) in the event five (5) or more Impermissible Interruptions
occur in any three hundred sixty-five (365) day period;
provided that Seller has not begun to and thereafter
diligently proceeds to complete all efforts required to
correct, to Purchaser's reasonable satisfaction, the
causes of the event or events which led to the
Impermissible Interruptions; or
(iii) in the event Temporary Service is required to be
supplied to the Premises from a portable unit which
materially inconveniences Purchaser for more than ten
(10) School Days (being herein defined as any day on
which any academic programs are (or were) scheduled to be
provided or conducted in any buildings on the Premises)
in any fiscal year or for more than thirty (30) School
Days in any five (5) year period; or
(iv) whenever the Seller shall do, or permit anything to be
done, whether by action or inaction, contrary to any
material covenant or agreement on the part of Seller
contained herein, or shall fail in the keeping or
performance of any of the material covenants, agreements,
terms or provisions of this Agreement which on the part
or behalf of Seller are to be kept or performed, and
Seller shall fail to commence to take steps to remedy the
same within thirty (30) days after written notice shall
have been given to Seller by Purchaser specifying the
same, or, in the event the matter or thing complained of
in said notice cannot reasonably be cured within said
thirty (30) day period, then such additional period of
time as is required to cure said default providing Seller
shall diligently commence and shall thereafter diligently
proceed to remedy the same; or
(v) whenever an involuntary petition shall be filed against
Seller under any bankruptcy or insolvency law or under
the reorganization provisions of any law of like import,
or a receiver of Seller or of or for the property of
Seller shall be appointed without the acquiescence of
Seller, or whenever this Agreement or the unexpired
balance of the Term would, by operation of law or
otherwise, except for this provision, devolve upon or
pass to any person, firm or corporation other than Seller
or a corporation in which Seller may be duly merged,
converted or consolidated under statutory procedure, and
such circumstance under this subparagraph (v) shall
continue and shall remain undischarged or unstayed for an
aggregate period of sixty (60) days (whether or not
consecutive) or shall not be remedied by Seller within
sixty (60) days; or
(vi) whenever Seller shall make an assignment of the property
of Seller for the benefit of creditors or shall file a
voluntary petition under any bankruptcy or insolvency
law, or whenever any court or competent jurisdiction
shall approve a petition filed by Seller under the
reorganization provisions of the United States Bankruptcy
Code or under the provisions of any law of like import,
or whenever a petition shall be filed by Seller under the
arrangement provisions of the United States Bankruptcy
Code or under the provisions of any law of like import,
or whenever Seller shall desert or abandon the Demised
Premises;
THEN (providing Purchaser is not then in default of any of its
obligations under this Agreement beyond any period provided for
notice and an opportunity to cure the same, but regardless of and
notwithstanding the fact the Purchaser has or may have some other
remedy under this Agreement or by virtue hereof, or in law or in
equity) Purchaser may, subject to the following provisions of this
subparagraph, give to the Seller a notice (herein called the
"second notice") of intention to end the Term of this Agreement
specifying a day not less than ten (10) days thereafter as being
the termination date hereof, and, upon the giving of the second
notice, this Agreement and the term hereby granted shall expire and
terminate upon the day so specified in the second notice as fully
and completely and with the same force and effect as if the day so
specified were the date hereinbefore fixed for the expiration of
the Term of this Agreement and (except as provided in subparagraph
18(j) hereof) all rights of Seller under this Agreement shall
thereupon expire and terminate. Any right Purchaser may have to
terminate this Agreement by virtue of the occurrence of any event
of the type delineated in Sections 6(a)(i) or (iii) hereof shall be
expressly contingent upon Purchaser's giving Seller the second
notice of Purchaser's intent to terminate this Agreement within one
hundred eighty (180) days of the occurrence of the same; it being
the intent of the parties that, unless Purchaser provides such
notice within said time frame, Purchaser shall be deemed to have
irrevocably waived its right to terminate this Agreement pursuant
to this subparagraph as a result of said event. The failure of
Purchaser to exercise any right it otherwise has to terminate this
Agreement by virtue of the occurrence of any such event shall not,
however, constitute, or be deemed to, have caused, a waiver by
Purchaser of any right it otherwise might then or thereafter have
hereunder as a result of the occurrence of any other event.
b. In addition to the foregoing rights, but not in
derogation thereof, Purchaser shall not be required to pay any
costs or fees hereunder during any period of time when Energy
Products are not available hereunder at the times and in the manner
required hereby, prorated for the period of such failure to supply,
excepting instances of scheduled system maintenance, when no
abatement of fees or costs shall apply. In the event that
Purchaser becomes entitled under this section to terminate this
Agreement, then Purchaser and Seller agree that any damages which
may be asserted by Purchaser to obtain a permanent supply of energy
to enable it to heat and air condition the Premises shall be
calculated net of any expenses saved as a consequence of the breach
with any necessary capital costs being depreciated over not fewer
than twenty (20) years, using the Purchaser's actual cost of
capital. Except as provided in subparagraphs 18(e) and (j) below
or as otherwise specifically enumerated in this Agreement, neither
party nor either party s parents, subsidiaries, affiliates, agents,
officers, directors, officials, or employees shall be liable to the
other party or said other party's parents, subsidiaries,
affiliates, agents, officers, directors, officials or employees for
claims for incidental, indirect or consequential damages, whether
based on breach of warranty (express or implied), contract, tort or
otherwise, connected with or resulting from, directly or
indirectly, performance or non-performance by either party of any
of its obligations under this Agreement.
c. Notwithstanding anything to the contrary set forth in
this Agreement, so long as the Purchaser is the City of Hartford
(the "City"), the Seller's obligation to provide any goods or
services under this Agreement in any fiscal year, and the
Purchaser's obligation to pay the Seller for any such goods or
services in any fiscal year (including, without limitation, any
fixed or other charges which otherwise would be payable by the
Purchaser regardless or whether any goods or services were in fact
provided to the Purchaser that year), is expressly contingent upon
the Purchaser's having first appropriated sufficient funds for that
purpose for such year to cover the cost of the same. If at any
time the Purchaser knows or has reason to believe that it has
failed to appropriate sufficient sums for said purpose, the
Purchaser shall promptly notify the Seller of that fact, and the
Seller shall then have the option to terminate this Agreement by
providing the Purchaser with written notice to that effect in
accordance with Section 19(e) of this Agreement. Any such
termination shall be effective as of the latter of (i) the date
through which the Purchaser reasonably can be expected to pay for
any and all charges hereunder that year by virtue of the sums
appropriated for that purpose, or (ii) the date specified in such
notice as the last day through which the Seller intends to provide
any goods or services hereunder. For purposes of this Agreement, a
"fiscal year" shall be the period between July 1 of each calendar
year and June 30th of the following calendar year, or such other
period of time which is adopted by the City as its official fiscal
year.
7. TERMINATION BY SELLER.
a. This Agreement is subject to the limitation that,
(i) whenever Purchaser shall fail to pay the undisputed
portion of any amounts which are owed to Seller within
thirty (30) days of Seller's written demand therefor; or
(ii) whenever the Purchaser shall do, or permit anything to be
done, whether by action or inaction, contrary to any
covenant or agreement on the part of Purchaser contained
herein, or shall fail in the keeping or performance of
any of the covenants, agreements, terms or provisions of
this Agreement which on the part or behalf of Purchaser
are to be kept or performed, and Purchaser shall fail to
commence to take steps to remedy the same within thirty
(30) days after written notice shall have been given to
Purchaser by Seller specifying the same, or, in the
event the matter or thing complained of in said notice
cannot reasonably be cured within said thirty (30) day
period, then such additional period of time as is
required to cure said default providing Purchaser shall
diligently commence and shall thereafter diligently
proceed; or
(iii) whenever an involuntary petition shall be filed
against Purchaser under any bankruptcy or insolvency law
or under the reorganization provisions of any law of like
import, or a receiver of Purchaser or of or for the
property of Purchaser shall be appointed without the
acquiescence of Purchaser, or whenever this Agreement or
the unexpired balance of the Term would, by operation of
law or otherwise, except for this provision, devolve upon
or pass to any person, firm or corporation other than
Purchaser or a corporation in which Purchaser may be duly
merged, converted or consolidated under statutory
procedure, and such circumstance under this subparagraph
(iii) shall continue and shall remain undischarged or
unstayed for an aggregate period of sixty (60) days
(whether or not consecutive) or shall not be remedied by
Purchaser within sixty (60) days; or
(iv) whenever Purchaser shall make an assignment of the
property of Purchaser for the benefit of creditors or
shall file a voluntary petition under any bankruptcy or
insolvency law, or whenever any court or competent
jurisdiction shall approve a petition filed by Purchaser
under the reorganization provisions of the United States
Bankruptcy Code or under the provisions of any law of
like import, or whenever a petition shall be filed by
Purchaser under the arrangement provisions of the United
States Bankruptcy Code or under the provisions of any law
of like import, or whenever Purchaser shall desert or
abandon the Demised Premises; or
(v) whenever some or all of Seller's facilities are destroyed
or substantially damaged by reason of Force Majeure or
all or a substantial portion of such facilities is taken
by eminent domain proceedings, such that the Seller
cannot meet its obligations hereunder and Seller
reasonably elects within ninety (90) days of any said
event not to rebuild or restore the facilities or
equipment by providing written notice to Purchaser of
that election; or
(vi) whenever any governmental entity withdraws any
governmental authority which otherwise is required by
Seller to furnish, or fails to enforce any governmental
rule or regulation and thereby prevents Seller from
furnishing, Energy Products substantially as required
under the provisions of this Agreement; providing that it
is impossible for Seller to regain such authority or
economically impracticable for Seller to comply with such
rules or regulations, and Seller notifies Purchaser of
that event within thirty (30) days of its occurrence;
THEN (providing Seller is not then in default of any of its
obligations under this Agreement beyond any period provided for
notice and an opportunity to cure the same, but regardless of and
notwithstanding the fact the Seller has or may have some other
remedy under this Agreement or by virtue hereof, or in law or in
equity) Seller may give to the Purchaser a notice (herein called
the "second notice") of intention to end the Term of this Agreement
specifying a day not less than ten (10) days thereafter as being
the termination date hereof, and, upon the giving of the second
notice, this Agreement and the term hereby granted shall expire and
terminate upon the day so specified in the second notice as fully
and completely and with the same force and effect as if the day so
specified were the date hereinbefore fixed for the expiration of
the Term of this Agreement and (except as provided in subparagraph
18(j) hereof) all rights of Purchaser under this Agreement shall
thereupon expire and terminate.
8. NONWAIVER. The failure of either party to assert its
rights under this Agreement shall not constitute a waiver of such
right except as stated otherwise. In the event of termination of
this Agreement, Seller may enter the Premises for the purpose of
removing Seller's equipment on at least thirty (30) days written
notice of its intent to do the same; providing, first, that no such
equipment shall be removed during any hours or in any manner as
would cause or threaten to cause any disruption of any academic
programs being conducted on the Premises; and, providing, further,
that Seller shall promptly repair any damage which may be effected
to the Premises by reason of its removal of its equipment.
Seller s obligations to indemnify and hold harmless Purchaser, and
to maintain insurance for the benefit of Purchaser, as provided in
Sections 19 (i) and (j) below shall continue to apply during and
with respect to any activity which may be undertaken by Seller
pursuant to this paragraph, notwithstanding the prior termination
hereof.
9. PURCHASER'S FACILITIES. Seller shall furnish Purchaser
with inlet strainers which are appropriate for the Energy Products
to be provided hereunder at no additional cost to Purchaser. Said
strainers, together with all piping, valves, regulators and other
equipment furnished by Purchaser, shall be and remain the property
of Purchaser. Purchaser agrees that it will properly maintain such
equipment at all times.
Additionally, by payment of $1,200,000.00, Purchaser may
acquire title to all of the pipe, valves, meters, flow regulators,
manholes and related equipment and materials that are to be
furnished and installed on the Learning Corridor property as
described in Exhibit A-1. Notwithstanding this transfer of title,
Seller shall continue to be fully responsible for the maintenance,
repair and replacement of all such transferred equipment for the
duration of the Term of this Agreement, except to the extent that
such maintenance, repair and replacement is required due to actions
of Purchaser.
In the event that the Purchaser pays the $1,200,000.00
described above, the initial Capital Recovery Component of the
Monthly Payment, which is more fully described in Exhibit B-Rate
Schedule shall be reduced by $9,167.00.
10. SELLER'S FACILITIES. The Seller also shall furnish and
install all valves, piping, meters, submeters, regulators and other
equipment which are required for delivery and monitoring of the
Energy Products between the Facility and the outside wall of the
building(s) to which they are to be supplied by Seller, all of
which property, with the exception of the inlet strainer, shall be
and remain the property of Seller, and is herein referred to as the
"Distribution System". Seller shall notify the Purchaser regarding
the proposed routing of the Distribution System from the Facility
not later than the date indicated on, and shall otherwise construct
said system in accordance with, the Development Milestone Schedule
which is attached hereto and made a part hereof as Exhibit C.
Seller agrees that it will properly maintain such equipment at all
times. Purchaser hereby grants Seller a right of access to
Seller's facilities for the purpose of maintaining and operating
same, provided that Seller shall give Purchaser prior notice of its
desire for such access, which notice shall not be required in the
case of an emergency.
11. METERING, ACCESS. Purchaser shall provide the Seller the
spaces at the Premises designated in Exhibit D in which to meter
Energy Product usage, which spaces shall be located within the
vicinity of the place where service enters the buildings. Seller
shall be allowed access to the Premises at all reasonable times for
the purpose of operating, inspecting, reading, repairing,
maintaining or altering any of Seller's equipment or meters located
in the Premises. Seller agrees to calibrate all meters for
accuracy in accordance with the manufacturer's specifications and
to provide the results of such calibration to Purchaser. Purchaser
reserves the right independently at its own expense to check the
calibration of such meters, provided it has notified Seller in
advance of such checking and Seller approves of the procedure and
personnel to be employed, which approval will not be unreasonably
withheld or delayed.
12. CONTROL WITHIN THE PREMISES. The Purchaser shall be
responsible for the control and possession of hot, chilled water
and return water from the time the hot or chilled water passes the
outlet side (or Purchaser's side) of Seller's inlet service valve
until the return water passes the inlet side (or Purchaser's side)
of Seller's outlet service valve. Except to the extent Seller is
negligent in the delivery of the Energy Products, after hot and
chilled water have passed the first of these two points, and before
the return water has passed the second of these two points, Seller
shall have no responsibility for anything which may be done, happen
or arise with respect to such hot, chilled water or return water.
Nothing in this Section 13 shall affect Seller's responsibility for
the accurate metering of Energy Products nor shall it affect
Seller's right of access to perform such metering or maintenance of
Seller's equipment located on the Premises.
13. GOVERNING LAW. This Agreement shall be governed by, and
construed, interpreted and enforced in accordance with the laws of
the State of Connecticut as such laws are applied to contracts
between Connecticut residents entered into and to be performed
entirely in Connecticut.
14. ASSIGNMENT.
a. This Agreement may be assigned by Seller, provided
Purchaser shall have consented thereto (such consent not to be
unreasonably withheld or delayed) and that the assignee assumes all
obligations hereunder. Purchaser also consents to any collateral
assignment of this Agreement by Seller to any lender in connection
with any financing of its construction or improvements to its
district heating and cooling system. Purchaser agrees to execute a
written consent to effectuate any assignment permitted under this
Agreement.
b. This Agreement may be assigned by Purchaser with Seller's
consent to any person or entity to whom ownership or possession of
the Premises is transferred on the condition that the assignee
shall assume all of Purchaser's obligations hereunder for the
balance of the term of this Agreement. Upon such assumption (in
such form and on such terms as are reasonably satisfactory to
Seller), Purchaser shall be relieved of all of its obligations
hereunder and all references herein to Purchaser shall be deemed to
mean Purchaser's assignee. Seller reserves the right to withhold
its consent to such assignment(s) and assumption(s) only if, in the
Seller's reasonable judgment, Seller concludes that the assignee(s)
will be incapable of meeting the obligations of Purchaser
hereunder. A copy of this Agreement, or a notice of this
Agreement, may be filed on the land records of the City of
Hartford. In the event of such filing, the rights and obligations
herein set forth shall be deemed to be covenants running with the
land and binding upon the successors and assigns of the parties.
c. Notwithstanding the foregoing, Seller agrees that
Purchaser may assign this Agreement and its rights and obligations
hereunder to The Learning Corridor Corporation (the "LCC"), or any
entity related thereto (individually and collectively, an "LCC
Assignee"), in which event such LCC Assignee shall be liable for
the performance of this Agreement if and only to the extent that
such assignee has received rents or other payments pursuant to
leases and other agreements relating to the Learning Corridor
sufficient to meet all of its obligations hereunder; providing,
however, that no such assignment shall be effective and LCC
Assignee's liability hereunder shall be limited as aforesaid unless
and until all referenced rents and other payments due to the LCC
Assignee shall have been collaterally assigned to Seller to the
extent necessary to secure payments due Seller hereunder.
15. CUSTOMER INSTRUCTIONS. Seller has provided Purchaser
with Customer Instructions which are attached as Exhibit D. Seller
will notify Purchaser in writing of proposed changes in the
Customer Instructions at least four (4) weeks before the changes
are effective, provided Purchaser shall not be required to accept
any changes which have a material effect on the terms and
conditions of this Agreement.
16. PRIOR AGREEMENTS. Intentionally Omitted.
17. ARBITRATION.
a. Any controversy or dispute as to (i) whether either party
has breached any of its obligations under this Agreement or, if so,
the extent to which the other is entitled to any damages as a
result thereof, or (ii) whether, and, if so, to what extent, any
adjustment is required in any of the rates to be charged to
Purchaser as provided in Exhibit B hereto, shall be resolved by
binding arbitration in Hartford, Connecticut in accordance with the
procedures and requirements set forth in this Paragraph 17. Except
as modified herein, such arbitration shall be held in accordance
with the rules then prevailing for commercial arbitrations before
the American Arbitration Association. Such resolution shall be
final and conclusive as to such controversy or dispute and may be
enforced in any court of competent jurisdiction.
b. Each party shall give written notice to the other of the
existence and nature of any dispute proposed to be arbitrated. If,
within 15 days (except in the case of matters which are the subject
of Paragraphs 6 and 7), the dispute is not resolved through
negotiations pursued diligently in good faith, then either party
may initiate arbitration by so advising the other party in writing.
If the parties cannot agree on a single arbitrator within 10 days
thereafter, each party shall by written notice appoint an
arbitrator and the two thus appointed shall select a third
arbitrator to serve as Chair of the panel of arbitrators, and such
three arbitrators shall determine all matters by majority vote.
Any such arbitrators shall be either (a) members in good standing
of the Connecticut Bar with at least ten (10) years experience as a
practicing attorney, who, if any dispute or controversy involves or
is likely to involve the interpretation or application of any of
the provisions of Exhibit B to this Agreement, have spent the
majority of at least five (5) years litigating or negotiating
complex financial or commercial matters, or (b) other professionals
with at least ten (10) years experience in or with the utility
industry. Prior to appointment, the arbitrator(s) shall agree to
conduct such arbitration in accordance with the terms of this
paragraph.
c. Except as otherwise provided by the arbitrator(s), the
parties shall have six (6) months to perform discovery and present
evidence and argument to the arbitrator(s). During that period the
arbitrator(s) shall be available to receive and consider all such
evidence as is relevant and, within reasonable limits due to the
restricted time period, to hear as much of such argument as
possible, giving a fair allocation of time to each party to the
arbitration. The arbitrator(s) shall use all reasonable means to
expedite discovery and shall sanction noncompliance with reasonable
discovery requests or any discovery order. The arbitrator(s) shall
not consider any evidence or argument not presented during such
period. At the conclusion of such period the arbitrator(s) shall
have thirty (30) days to reach a determination.
d. The arbitrator(s) shall have the right only to interpret
and apply the terms of this Agreement and may not change any such
terms, deprive any party thereto of any right or remedy expressly
provided hereunder, or provide any right or remedy that has been
excluded hereunder.
e. The determination of the arbitrator or the majority of
the arbitrators shall be conclusive upon the parties. The
arbitrator or the majority of the arbitrators shall give written
notice to the parties stating the determination and findings of
fact and conclusions of law, and shall furnish to each party a copy
thereof signed by him or them within ten (10) calendar days from
the date of such determination.
f. All costs of the arbitrator(s) in connection with any
arbitration shall be paid by the nonprevailing party, unless the
arbitrator(s) shall otherwise determine for good cause on a case-
by-case basis.
g. Nothing herein shall preclude either party from seeking
to restrain the breach or threatened breach of this Agreement by
the other in a court of equity, or from pursuing any other
equitable rights or remedies which it may have against the other,
or, except to the extent any claim or action is for or sounds in
breach of contract, from pursuing any other rights or remedies it
may have against the other in a court of law.
18. ACCESS AND DEVELOPMENT. In order to effectuate the
foregoing agreements, the parties agree as follows:
a. NOTICE. Seller shall notify the Purchaser regarding the
proposed routing of its pipelines for its hot and chilled water
prior to the submission of its permit applications.
b. SERVICE REQUIREMENTS. Seller shall install service
adequate to satisfy the Purchaser's heating and cooling
requirements in accordance with the Energy Product Specifications
set forth in Exhibit A-2 hereto.
The Parties shall cooperate fully with each other and with
each others' contractors in the construction of the on-site
portions of Seller's work in a manner that will not adversely
impact either Party's construction effort.
c. ATTENDANCE AT MEETINGS. Seller and Purchaser will make
all reasonable efforts to participate in the Purchaser's project
coordination meetings.
d. REPORTS. Seller shall provide the Purchaser a monthly
update of Seller's progress measured against the Milestone
Development Schedule. If it becomes apparent to the Purchaser that
the Seller may not be able to achieve the Late Completion
Milestones, Purchaser may demand that Seller take corrective
action.
e. DAMAGES FOR DELAY. Seller hereby acknowledges and agrees
that time is of the essence in the performance of this Agreement
and, to that end, that Purchaser is relying on Seller to have
completed the permanent facilities on the Premises, and
substantially completed the Distribution System and any and all
other offsite facilities necessary to provide the Energy Products
to the Premises, by no later than the final completion date set
forth in Exhibit C. Seller hereby acknowledges and agrees that
Purchaser is likely to incur damages in excess of $10,000.00 a
month should Seller fail to complete such work as aforesaid.
Accordingly, and without in any way limiting any rights or remedies
which Purchaser may have against Seller, all of which are hereby
reserved on Purchaser's behalf, Seller hereby agrees that it shall
pay Purchaser the sum of $10,000 per month (prorated for any part
thereof) for and on and as of the last day of each month (or part
thereof) that Seller has not completed such work after the last day
of the month immediately preceding the final completion date set
forth in Exhibit C. Any amounts payable by Seller as aforesaid
shall merely constitute the pre-payment by Seller of a portion of
the damages which are likely to be incurred and for which Seller
shall remain liable hereunder; it being the agreement of the
parties, however, that if Seller believes that Purchaser has not
incurred damages equal to at least $10,000 a month (prorated for
any part thereof), Seller will have the burden of proving by clear
and convincing evidence that Purchaser has not in fact been damaged
to that extent.
f. LICENSES. Seller shall be solely responsible for
securing all permits and licenses and for the construction of all
of the facilities, equipment and pipelines that may be required to
serve the Purchaser's facilities. Purchaser will cooperate with
Seller in the filing of any appropriate applications.
Notwithstanding these provisions, Purchaser shall provide Seller,
at no cost to Seller, all necessary easements and similar rights to
enable Seller to construct and maintain its facilities within areas
that are controlled by Purchaser.
g. ALTERNATE CONNECTIONS. Seller will incorporate alternate
connection points in its design for those portions of the hot water
and chilled water systems that are to be located on the Purchaser's
site. These alternate connection points will be designed and
located to mutually agreeable standards to allow the Seller to
isolate the Purchaser's facility and to connect temporary boilers
and chillers to the on-site distribution system. This design
feature will enable Seller to satisfy Purchaser's full design load
in the event that the operation of Purchaser's hot water and
chilled water production facilities or Purchaser's pipelines are
disrupted.
h. LIENS. Seller shall not allow any liens to be placed
against Purchaser's properties. If any such liens are filed,
Seller shall discharge the same promptly at Seller's expense.
i. INSURANCE.
During the term hereof, the Seller shall carry and keep in
force the following types and amounts of liability insurance:
(i) GENERAL LIABILITY INSURANCE. The Seller shall carry and
keep in force a policy or policies of comprehensive
general liability insurance (including contractual
liability coverage) insuring against damages to persons
or property (including, but not limited to, loss of life)
occurring upon, in or about the Premises, in an amount
not less than a combined single limit of at least One
Million Dollars ($1,000,000.00) for each occurrence with
a deductible not exceeding Ten Thousand Dollars
($10,000.00), which deductible is understood to be the
responsibility of the Seller;
(ii) Automobile Liability Insurance for all automobiles used
by the Seller and/or any of its officers, agents and/or
employees in connection with the services provided by it
hereunder, with a combined single limit of one million
dollars ($1,000,000.00) for each accident with a
deductible not exceeding Ten Thousand Dollars
($10,000.00), which deductible is understood to be the
responsibility of the Seller; and
(iii) Workers' Compensation Insurance covering the Seller's
and its agent's and Seller's employees at the Connecticut
Statutory limit including Employers' Liability with
limits of $100,000.00 for each accident, $500,000.00 for
each disease/policy limit, and $100,000 for disease for
each employee, with a deductible not exceeding Ten
Thousand Dollars ($10,000.00), which deductible is
understood to be the responsibility of the Seller; and
(iv) Umbrella Liability following form over the insurance
provided under subsections (a)(i) and a(ii) above, and
Employer's Liability Insurance, with a limit of liability
which, when combined with the primary insurance over
which such excess coverage is being provided, equals at
least Ten Million Dollars ($10,000,000.00).
The amounts of the aforementioned coverages shall be reviewed
and, as appropriate, revised by agreement of the parties as of July
1, 2001 and every (3rd) anniversary thereof thereafter. In the
event the parties are unable to reach agreement as to whether and,
if so, to what extent, any changes should be made in the foregoing
at least ninety (90) days prior to the date that any such agreement
is otherwise required hereunder, the parties shall (and, at any
other time, either party may, at its own sole cost and expense)
cause said coverages to be determined at least forty-five (45) days
prior to said date by an independent adjuster approved by both
parties (an "Independent Adjuster"), which approval shall not be
unreasonably withheld or delayed. For purposes of the foregoing,
any person which is nominated by a party (the "nominating party")
to serve as an Independent Adjuster hereunder shall be deemed
approved by the other party unless said other party (the "objecting
party") provides written notice of its objection thereto to the
nominating party within five (5) business days of the objecting
party's receipt of said nomination. In the event the parties are
unable to agree on an Independent Adjuster within thirty (30) days
of either party's having first nominated any person to serve in
that capacity, or should any dispute exist concerning any
determination reached by any Independent Adjuster, the amount of
such coverages as then remain in dispute shall be resolved by
arbitration in accordance with Section 17 below; providing, first,
that neither party shall be able to dispute any determination which
is made by an Independent Adjuster unless it gives notice of its
intent so to do within thirty (30) days of its receipt of notice of
such adjuster's determination thereof under and in accordance with
this Agreement, and providing, further, that in the event of any
such dispute, any and all coverages in question shall be and remain
the higher of the amounts previously required hereunder or the
amounts determined to be appropriate by the Independent Adjuster
until the matter is resolved pursuant to arbitration at which time
the coverages in dispute shall be as established by the
arbitrators, subject to future adjustment pursuant to this
paragraph.
The insurances required in this Section may be carried on
either an "occurrence" or a "claims made" basis, providing,
however, that, should any insurance be carried on a "claims made"
basis, the Seller also shall be obligated to procure an extended
reporting period thereto or a subsequent "claims made" policy with
the same retroactive date as the prior "claims made" policy, as
necessary to protect CREC and the Purchaser from any claims,
actions or causes of action which first accrue during the term
hereof.
All insurance which is carried pursuant to this shall include
provisions which deny to the insurer acquisition by subrogation of
rights of recovery against the Purchaser, as and to the extent such
rights have been waived by the insured party prior to occurrence of
loss or injury as set forth elsewhere in this paragraph, and
insofar as and to the extent that such provisions may be effective
without making it impossible to obtain insurance coverage from
reputable companies qualified to do business in the State of
Connecticut even though extra premiums may result therefrom. The
Purchaser shall be entitled to have duplicates of certificates of
any policies containing such provision. The Seller hereby waives
its rights of recovery against the Purchaser for loss or injury
against which the Purchaser is protected by insurance containing
said provisions, reserving, however, any rights with respect to any
excess of loss or injury over the amount recovered by such
insurance.
The Purchaser shall be named as additional insureds for all
insurance policies required hereunder. The Seller shall file
certificates of all such insurance with the Purchaser. All
insurance will be effected under standard form policies by insurers
of recognized responsibility which are licensed and/or admitted to
do business in the State of Connecticut and which are rated as A-
(X) or better by the latest edition of Best's Rating Guide or other
recognized replacement therefor (or as otherwise approved by
Purchaser in writing on a case by case basis upon issuance of any
policy and/or any renewal thereof, which approval may be withheld
in its sole and absolute discretion), and will provide for thirty
(30) days prior notice of any cancellation of or changes in
coverage provided in the certificates of insurance. Copies of such
insurance policies, or certificates of insurance, will be provided
to the Purchaser upon the execution of this Agreement and no later
than thirty (30) days prior to each renewal date thereof each year
thereafter.
All insurance policies referred to in this Article shall
provide that any losses thereunder shall be adjusted with the
Purchaser and the Seller and that loss thereunder shall be payable
to the Seller and the Purchaser, as their interests may appear.
Neither the Seller nor Purchaser shall unreasonably withhold or
delay its endorsement to any insurance check payable hereunder.
Except as otherwise provided to the contrary in this Section,
any insurance required by this Agreement may be obtained by means
of any combination of primary and umbrella coverages and by
endorsement and/or rider to a separate or blanket policy and/or
under a blanket policy in lieu of a separate policy or policies,
provided that the Seller shall deliver a certificate of insurance
of any said separate or blanket policies and/or endorsements and/or
riders evidencing to the Purchaser that the same complies in all
respects with the provisions of this Agreement, and that the
coverages thereunder and the protection afforded the Purchaser
thereunder are at least equal to the coverages and protection which
would be provided under a separate policy or policies procured
solely under and by reason of this Agreement. The certificates of
such policy or policies evidencing such coverages shall be
delivered to the Purchaser upon the execution hereof and as of
thirty (30) days prior to the anniversary date thereof each year
thereafter.
All references in this Article to a "deductible" shall be
deemed to mean a deductible and/or a self insured retention.
The Seller agrees that it will not carry or be the beneficiary
of any insurance insuring the Seller or any other person or entity
against the risks for which insurance is required to be maintained
pursuant to this Section unless the Purchaser is named as
Additional Insureds thereunder and the insurance and insurance
carriers otherwise comply with the terms of this Section.
It is agreed between the parties hereunto that the amounts of
insurance in this Agreement do not, in any way, limit the liability
of the Seller to the Purchaser by virtue of its promise to
indemnify and hold harmless the Purchaser so that in the event that
any Claim results in a settlement or judgment in an amount in
excess of the amount of insurance coverage carried by the Seller,
the Seller shall be liable to the Purchaser for the difference,
plus all fees and expenses incurred in collecting the same, all at
the Seller s sole cost and expense. In the event the City of
Hartford, as the initial Purchaser, assigns its interests in this
Agreement in connection with any lease of the Premises, then the
term "Purchaser" as used in this Section 19(i) shall be deemed to
mean and include the City and the assignee.
j. INDEMNIFICATION.
(i) The Seller shall indemnify, defend and hold harmless the
Purchaser, and its agents, officials, employees and
assigns from and against any and all loss or liability
(statutory or otherwise), claims, actions, suits,
demands, judgments, costs, executions, interest and
expense whatsoever, including, but not limited to, costs
of investigation, defense and settlement and all
reasonable attorneys' fees and disbursements,
(hereinafter, individually and collectively, a "Claim" or
"Claims") for or arising from Seller's Facility or
Distribution System, or Seller's performance or lack
thereof hereunder, or the negligence of Seller or any of
its officers, directors, agents or employees, including,
but not limited to, Claims based upon the Seller's
failure to pay for or provide goods or services as
required hereunder or any act or omission on the part of
the Seller or any of its agents, officers, directors or
employees in the acquisition or provision thereof, as
well as Claims for or arising from injury to, or death
of, any person or persons, or damage to real or personal
property (including the loss of use thereof), which
occurs under, in connection with or by reason of this
Agreement or the Seller's performance hereunder (or lack
thereof) during the term hereof. In case any action or
proceeding is brought against the Purchaser by reason of
any matter which is the subject of the foregoing
indemnity, the Seller shall pay all costs, reasonable
attorneys' fees, out-of-pocket expenses, and liabilities
resulting therefrom, and shall resist such action or
proceeding by attorneys chosen by it and reasonably
satisfactory to the Purchaser, as applicable.
(ii) The Purchaser shall indemnify, defend and hold harmless
the Seller, and its agents, officers, directors and
employees and assigns from and against any and all loss
or liability (statutory or otherwise), claims, actions,
suits, demands, judgments, costs, executions, interest
and expense whatsoever, including, but not limited to,
costs of investigation, defense and settlement and all
reasonable attorneys' fees and disbursements,
(hereinafter, individually and collectively, a "Claim" or
"Claims") for or arising from Purchaser's performance or
lack thereof hereunder or the negligence of Purchaser or
any of its officials, agents or employees, including, but
not limited to, Claims based upon the Purchaser's failure
to pay for or provide goods or services as required
hereunder or any act or omission on the part of Purchaser
or any of its agents, officers, directors or employee in
the acquisition or provision thereof, as well as Claims
for or arising from injury to, or death of, any person or
persons, or damage to real or personal property
(including the loss of use thereof), which occurs under,
in connection with or by reason of this Agreement or the
Purchaser s performance hereunder (or lack thereof)
during the term hereof. In case any action or proceeding
is brought against the Purchaser by reason of any matter
which is the subject of the foregoing indemnity, the
Purchaser shall pay all costs, reasonable attorneys'
fees, out-of-pocket expenses, and liabilities resulting
therefrom, and shall resist such action or proceeding by
attorneys chosen by it and reasonably satisfactory to the
Seller, as applicable.
k. LATE PAYMENTS. At its option, either party may impose a
late payment charge not to exceed 1.25% per month on all sums not
paid thereto in full as and when due hereunder. The exercise of
this option by either party shall not preclude said party from
exercising any other right or remedy it may have under or by virtue
of this Agreement.
19. MISCELLANEOUS.
a. This Agreement shall be binding upon Purchaser, Seller
and their respective successors and assigns
b. The headings and titles of paragraphs are for convenience
only and do not affect the meaning or interpretation of any
provision hereof.
c. Except as otherwise stated herein, this Agreement
constitutes the entire understanding and agreement of the parties
hereto as to the subject matter hereof and supersedes all prior
agreements, understandings and negotiations between the parties
with respect thereto. No modification or amendment of this
Agreement shall be valid and effective unless expressly set forth
in an agreement in writing signed by Purchaser and Seller.
d. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original, and all of which together
shall constitute but one and the same instrument.
e. Any notice, invoice or other communication that is
required to be given pursuant to this Agreement shall be sent to
the persons or offices, and to the addresses, set forth below:
If to Seller: Xxxxxxxx X. Xxxxxxx, Esq.
Vice President, General Counsel
and Secretary
The Energy Network
000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxx, XX 00000-0000
If to Purchaser: City Manager
City of Hartford
000 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
With a copy to:
Corporation Counsel
City of Hartford
000 Xxxx Xxxxxx
Xxxxxxxx, XX 00000
f. Purchaser and its successors and assigns shall have the
right at any time during the term of this Agreement to prepay in
whole or in part the so-called "Capital Recovery Component"
described in Exhibit B based upon a price fairly determined which
reflects the Seller's investment (net of depreciation) and the
assumed return on such investment over the term hereof. In the
event such right to prepay is exercised, Purchaser and Seller shall
grant to each other such rights, easements and licenses as may be
reasonably necessary for Seller to retain the use and equipment of
the affected assets and for Purchaser to acquire legal title to
such assets; provided that nothing in the foregoing shall otherwise
alter the rights and obligations of the parties hereto under this
Agreement.
20. CONDITIONS OF ACCESS TO AND WORK ON THE PREMISES.
To the extent reasonably possible and except in cases of
emergency, Seller shall not attempt to gain access to, maintain or
perform any other work with respect to any equipment or any other
matter or thing on the Premises at any time when its so doing is
likely to cause any disruption of any academic programs being
conducted on the Premises. Seller further agrees that it shall
repair any damage which may occur to the Premises by reason of any
work or other activity which it performs or in which it is engaged
thereon.
21. NO MECHANIC'S LIENS.
Notice is hereby given that the City of Hartford shall not be
liable for any labor or materials furnished or to be furnished to
the Seller upon credit, and that no mechanic's or other lien, for
any such labor or materials shall attach to or affect the estate or
interest of the City in and to Premises. Whenever and as often as
any such lien shall have been filed against the Premises, whether
or not based upon any action or interest of Seller or of any
subcontractor or if any conditional xxxx of sale shall have been
filed for or affecting any materials, machinery or fixtures used in
the construction, repair or operation thereof, or annexed thereto,
by the Seller, the Seller shall forthwith take such action by
bonding, deposit or payment as will remove or satisfy the lien or
conditional xxxx of sale.
22. WARRANTY OF EQUIPMENT. Seller hereby warrants that all
of the materials which are purchased from the Seller hereunder
shall be suitable for the purposes intended and shall be free from
defects in material and workmanship as and when installed Seller
hereunder.
SELLER:
THE ENERGY NETWORK, INC.
By: S/ Xxxxx X. Xxxxxxx 4/5/99
-----------------------------
Its: President
Duly Authorized
PURCHASER:
CITY OF HARTFORD
By: S/ Xxxxx X. Xxxxx
-----------------------------
Its:Acting City Manager 4/6/99
Duly Authorized Xxxxx X. Xxxxx
Approved as to legality and form.
S/ Xxxxxxx X. Calleris
----------------------------------
Acting Corporation Counsel
Exhibits Attached:
Exhibit A - Easement Form
Exhibit A-1 - Legal Description (map)
Exhibit A-2 - Energy Product Specifications
Exhibit B - Rate Schedule
Appendix to Exhibit B - The Learning Corridor Pricing
Appendix to Exhibit B - Hot/Chilled Water Pricing
Exhibit C - Development Milestone Schedule
Exhibit D - Customer Instructions
