EXHIBIT 10.48
REAL PROPERTY LEASE
AND EASEMENT AGREEMENT
This Lease is made and entered into by and between THE XXXX:
COMPANY ("LESSOR" hereinafter), a Georgia corporation, and PANDA-
XXXXXXXX CORPORATION ("LESSEE" hereinafter), a Delaware corporation.
In consideration of the mutual covenants and agreements set forth in
this Lease, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, LESSOR does hereby (i)
demise and lease to LESSEE and LESSEE does hereby lease from LESSOR
that certain real property (the "Premises" hereinafter) located in the
City of Roanoke Rapids, County of Halifax, State of North Carolina,
more fully described in Exhibit A hereto and (ii) grant and convey to
LESSEE an easement of ingress and egress on and across property owned
by LESSOR, which real property is described in Exhibit B hereto, to
the extent necessary to assemble, construct, use, operate, inspect and
maintain the cogeneration facility (the "Facility") hereinafter
described and all interconnection facilities (the "Interconnection
Facilities") necessary to deliver electrical, steam and other energy
to LESSOR and to Virginia Electric and Power Company ("Utility")
(including, without limitation, all transformers, breakers, lines,
poles, guy wires and anchors and associated equipment and material,
and any modifications thereto, required for the purpose of connecting
the Facility to Utility's transmission lines).
ARTICLE 1 - PURPOSE OF LEASE AND EASEMENT
1.01 LESSOR and LESSEE each understand that the purpose of this Lease
and Easement is to provide land upon which LESSEE will construct the
Facility (and will employ the Facility to provide electricity and steam to
the LESSOR and Utility and to others) pursuant to that certain Cogeneration
Energy Supply Agreement (the "COGENERATION AGREEMENT" hereinafter) entered
into between LESSOR and LESSEE as of January 11, 1989.
1.02 LESSEE shall comply with all present and future laws, ordinances,
rules and regulations of any governmental authority (including, without
limitation, rules and regulations of the Environmental Protection Agency
and the Occupational Safety and Health Administration) affecting the
Facility or any part thereof and/or the operation thereof in accordance
with the terms of the COGENERATION AGREEMENT.
ARTICLE 2 - TERM OF LEASE AND EASEMENT
2.01 Subject to extension as provided in Section 2.02 or 2.03 below,
the initial term of this Lease and Easement shall commence on the date of
the execution hereof. It shall terminate on December 31 of the year in
which the twenty-fifth (25th) anniversary of the Completion Date specified
in the COGENERATION AGREEMENT occurs.
2.02 If LESSOR exercises the option described in Sections 8.01(a)
and 8.02 of the COGENERATION AGREEMENT (to extend the term of the
COGENERATION AGREEMENT for an additional ten years), the initial term
of this Lease and Easement shall be automatically extended for an
identical ten (10) year period at the annual rental and on the terms
and conditions contained herein. The term of this Lease and Easement,
if so extended, shall expire on December 31 of the year in which the
thirty-fifth (35th) anniversary of the Completion Date occurs.
2.03 Notwithstanding any provision of the COGENERATION AGREEMENT
to the contrary, LESSEE shall have the option of extending this Lease
and Easement for a term of ten years beginning on December 31 of the
year in which the twenty-fifth (25th) anniversary of the Completion
Date specified in the COGENERATION AGREEMENT occurs and terminating on
December 31st of the year in which the thirty-fifth (35th) anniversary
of the Completion Date specified in the COGENERATION AGREEMENT occurs
at the annual rental and on the terms and conditions otherwise
contained herein by giving notice to LESSOR of its intention to extend
at least two years prior to the end of the initial term hereof and
thereupon the term of this Lease and Easement shall be so extended
without any further action by either party.
ARTICLE 3 - RENT
3.01 Subject to adjustment as provided in Section 6.01 below,
LESSEE agrees to pay LESSOR the sum of one dollar ($1.00) for each
year or partial year of the initial and extended term of this Lease
and Easement.
3.02 Rent for the first year shall be due and payable
concurrently with the execution of this Lease and Easement. Rent for
the second year shall be due and payable on January 1 of the year next
following the year in which this Lease and Easement is executed. Rent
for subsequent years shall be due and payable on each subsequent
January 1. Rent may be prepaid.
ARTICLE 4 - SURRENDER
4.01 Upon the expiration of the term (initial or extended) of this
Lease and Easement, unless LESSOR elects to purchase the Facility as
permitted by Sections 8.01(b) and 8.03 of the COGENERATION AGREEMENT,
LESSEE shall within twenty-four (24) months after the expiration of the
term (initial or extended), and at its own expense, remove all
improvements on the Premises and grade and otherwise and restore the
Premises to the condition in which it existed on the date of execution
of this Lease, except that LESSEE shall not be required to replace any
materials actually excavated or removed from the Site during
construction of the Facility.
ARTICLE 5 - CONDEMNATION
5.01 If, during the term of this Lease and Easement, all of the
Premises, or such portion thereof as shall practically prevent the
intended use and operation of the Facility, should be taken for any
public or quasi-public use under any governmental law, ordinance, or
regulation, or by right of eminent domain, or should be sold to the
condemning authority under threat of condemnation, this Lease and
Easement shall terminate, and the rent shall be abated during the
unexpired portion of this Lease and Easement, effective as of the date
of the taking of the Premises by the condemning authority.
ARTICLE 6 - DEFAULT
6.01 LESSOR and LESSEE each recognize that a substantial
expenditure will be made by LESSEE to construct the Facility and the
Interconnection Facilities on the Premises and that one or more liens
on the said Facility (or on parts thereof), or on LESSOR's rights and
interest hereunder, will be created in connection with said
construction. Accordingly, LESSOR and LESSEE each agree as follows:
(a) that a termination of the COGENERATION AGREEMENT, by either
party, prior to expiration of the initial term or of the extended term
(if the initial term has been or is extended as provided in 2.02 or
2.03 above) of this Lease and Easement, shall not have the effect of
terminating this Lease and Easement. LESSOR and LESSEE shall (in the
event of any such termination of the COGENERATION AGREEMENT) negotiate
a new rental for the balance of the term of this Lease and Easement.
Said new rental shall be a reasonable rental, payable monthly, for the
Premises (without consideration of the improvements thereon) for the
use and time period in question. If LESSOR and LESSEE are unable to
negotiate a new rental, the new rental shall be determined by
arbitration pursuant to the Commercial Rules of the American
Arbitration Association. Notwithstanding the foregoing, this Lease may
be terminated by LESSOR in the event that the COGENERATION AGREEMENT
is terminated for any of the reasons specified in Section 13.01(ii)
through (vi) thereof;
(b) that, if any rental payment is not made when due, LESSOR may
terminate this Lease and Easement upon a minimum of thirty (30) days
written notice of such default to LESSEE. If LESSEE ceases to operate
an electricity or steam generating power plant on the Premises, LESSOR
may terminate this lease upon a minimum of twelve months written notice
of default to LESSEE. Said notice of termination shall be withdrawn if
the default in question is cured prior to the expiration of the notice
period in question. LESSOR shall have the option, subject to Section
8.03(d) of the COGENERATION AGREEMENT, to purchase the Facility and
the Interconnection Facilities after the effective date of such
termination for a purchase price determined in accordance with
Sections 8.03(b) and (c) of the COGENERATION AGREEMENT, which option
may be exercised by giving written notice to LESSEE of such exercise
within 30 days after such effective date. Notwithstanding anything in
Section 8.02(a) of the COGENERATION AGREEMENT to the contrary, no
option to purchase the Facility and the Interconnection Facility may be
exercised by LESSOR on or after the 31st day following such effective
date. Neither LESSEE nor its assigns shall be deemed to have ceased
operating a power plant on the Premises by reason of (i) temporarily
(for purposes of maintenance or repair) or permanently (for purposes of
replacement) removing any or all items of machinery, equipment or
other personal property located on the Premises or the Easement 9 ( ii
) the failure to generate or sell electricity or steam during any
period that electricity or steam is not required to be generated or
sold under the COGENERATION AGREEMENT or any contract LESSEE may have
to sell electricity, (iii) the failure to generate electricity or
steam during any period in which the Facility or the Interconnection
Facilities are being repaired or (iv) any act or occurrence described
in Section 11.01 of the COGENERATION AGREEMENT is preventing the
generation or sale of steam or electricity.
(c) that a default under the COGENERATION AGREEMENT by either
party, prior to the expiration of the said initial or extended term of
this Lease and Easement, shall not be considered a default under this
Lease and Easement (unless otherwise provided herein); and (~) that the
remedy for a default under this Lease and Easement shall be damages
(and not termination) unless otherwise provided herein.
6.02 The failure, by either party, to seek a remedy for a specific
breach of this Lease and Easement shall not constitute a waiver of the
right to seek a remedy for that breach.
A waiver by either party of a breach of this Lease and Easement
shall not constitute a waiver of any subsequent breach.
ARTICLE 7 - INSPECTION
7.01 Without regard to ownership or other rights in the Facility,
the Interconnection Facilities, the Easement or the property owned by
LESSOR adjacent to the Leased Premises ("LESSOR's Plant"), it is
understood that the parties hereto, their agents, employees,
contractors, subcontractors, and other authorized representatives,
will of necessity require access to facilities or areas controlled by
or under the jurisdiction of the other party; and furthermore that
Utility, its agents, employees, contractors, subcontractors and other
authorized representatives will of necessity require access to
facilities or areas controlled by both parties hereto. LESSOR and
LESSEE agree to provide and make available such access, provided that
LESSOR and LESSEE shall each take all reasonable steps to insure that
no access by such party to areas controlled by the other party whether
for inspection or otherwise shall unreasonably interfere with the
operations of such other party.
ARTICLE 8 - QUIET ENJOYMENT; TITLE TO IMPROVEMENTS
8.01 LESSOR covenants that at all times during the term
of this Lease and Easement, so long as LESSEE is not in default
hereunder, LESSEE's quiet enjoyment of the Lease and Easement Premises
or any part thereof shall not be disturbed by any act of LESSOR, or any
one acting by, through or under LESSOR.
8.02 LESSOR agrees that the Facility and Interconnection
Facilities, as between LESSOR and LESSEE, are and shall remain the
personal property of LESSEE at all times. Unless and until LESSOR has
exercised its option granted in the COGENERATION AGREEMENT to purchase
the Facility and subject to the provisions of Section 6.01(b) hereof,
LESSEE shall have the right to remove all improvements constituting the
Facility and the Interconnection Facilities, and additions thereto, at
any time and from time to time regardless of the degree of affixation
of such property to the Leased Premises, the Easement or LESSOR's
Plant. LESSOR hereby waives any landlord's lien, contractual or
otherwise, it may have in and to the improvements and personal property
constituting the Facility or the Interconnection Facilities, and
additions thereto, or which is located on or about the Premises or the
Easement.
ARTICLE 9 - MISCELLANEOUS
9.01 All notices, approvals, consents, requests and other
communications hereunder shall be in writing and shall be deemed to
have been given when delivered to the other party by registered,
certified or express mail, return receipt requested/ postage prepaid'
addressed as follows:
If to the LESSEE: Panda Energy Corporation
0000 Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxxxx Xxxxxx
If to the LESSOR: Director of Operations
The Xxxx Company
Xxxxx Products Division
X.X. Xxx 0000
Xxxxxxx Xxxxxx, XX 00000
Rejection or refusal to accept or the inability to deliver because of
changed address of which no notice was given shall be deemed to be receipt
of the notice, approval, consent, request or other communication so sent.
The parties hereto may, by notice given hereunder, designate any further
or different addresses to which subsequent notices, approvals, consents,
requests or other communications shall be sent or persons to whose
attention the same shall be directed.
9.02 This Lease and Easement shall be binding upon, and inure to the
benefit of, the parties to this Lease and Easement and their respective
heirs, executors, administrators, legal representatives, successors, and
assigns when permitted by this Lease and Easement.
9.03 THIS LEASE AND EASEMENT SHALL BE CONSTRUED UNDER, AND IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NORTH CAROLINA.
9.04 The rights and remedies provided by this Lease and Easement
are cumulative, and the use of any one right or remedy by either party
shall not preclude or waive its rights to use any or all other
remedies. These rights and remedies are given in addition to any other
rights the parties may have by law, statute, ordinance, or otherwise.
9.05 If, as a result of a breach of this Lease and Easement by
either party, the other party employs an attorney or attorneys to
enforce its rights under this Lease and Easement, then the breaching
party agrees to pay the other party the reasonable attorney's fees an
costs incurred to enforce the Lease and Easement.
9.06 Either party hereto may assign its rights hereunder without
approval but may not delegate its obligations without the express
written approval of the other party.
9.07 LESSOR agrees that LESSEE shall have the right, from time to
time, and at any time during the term of this Lease and Easement, to
mortgage its leasehold estate in the leased Premises, the Easement or
any portion thereof, or to encumber the same or any portion thereof,
by deed of trust or otherwise, to secure the financing of the
development, construction or operation of the Facility. From and after
the time that LESSOR has received written notice of any such mortgage
or deed of trust from LESSEE and the mortgagee or deed of trust
beneficiary ("LENDER" hereinafter), LESSOR shall furnish written
notice to LENDER of any default hereunder and of the remedy LESSOR
intends to exercise simultaneously with notice to LESSEE thereof or,
if earlier, at least twenty (20) days prior to exercising such remedy,
and shall give LENDER copies of all notices required to be given to
LESSEE hereunder, and LENDER shall have the right to perform on
behalf of LESSEE any covenant of LESSEE hereunder. LENDER, its
successors and assigns, may, at their option, and by delivery to
LESSOR of a written agreement to assume the obligations and duties of
LESSEE under this Lease and Easement, succeed to LESSEE's rights and
privileges under this Lease and Easement and receive the benefits and
accept the responsibilities of this Lease and Easement pursuant to the
terms and provisions hereof, and LESSOR will recognize the succession
of LENDER, its successors and assigns, to LESSEE's rights and will
continue to perform LESSOR's obligations contained in this Lease and
Easement for so long as LENDER, its successors and assigns, continue
to perform the obligations of LESSEE under this Lease and Easement as
they become due. In the event that LENDER succeeds to the rights and
interest of LESSEE hereunder, LESSOR hereby agrees that LENDER may, at
its option, and by delivering written notice to LESSOR, assign its
interest under this Lease and Easement to any individual, sole
proprietorship, partnership, joint venture, trust, unincorporated
organization, association, corporation, institution, entity, or
other person ("ASSIGNEE" hereunder). Such ASSIGNEE shall succeed
to LENDER's rights and privileges under this Lease and Easement and
receive the benefits and accept the responsibilities of LESSEE pursuant
to the terms and provisions of this Lease and Easement, and LESSOR
will recognize the succession of such ASSIGNEE to LENDER's rights hereunder
and will perform its obligations and duties hereunder provided that
such ASSIGNEE executes and delivers to LESSOR a written agreement to
assume the obligations and duties of LESSEE hereunder. LESSOR
acknowledges and agrees that upon the consummation of an assignment to
an ASSIGNEE, LENDER shall have no further obligation, duty or
liability to LESSOR hereunder.
9.08 LESSEE shall pay all ad valorem taxes on, or any increase in
ad valorem taxes payable by LESSOR that results from or is
attributable to, the Facility or the Interconnection Facilities.
9.09 LESSOR and LESSEE shall cooperate with each other in
obtaining any and all government permits, certificates or other
authority that may be required as a prerequisite to the activities set
forth herein.
ARTICLE X - INDEMNIFICATION
10.01 LESSEE shall not cause or permit any Hazardous Material to
(as hereinafter defined) to be brought upon, kept, or used in or about
the Premises by LESSEE, its agents, employees, contractors or
invitees, except for such Hazardous Material as is necessary or useful
to LESSEE'S business.
10.02 Any Hazardous Material permitted on the Premises as
provided in Section 10.01 and all containers therefor, shall be used,
kept, stored and disposed of in a manner that complies with all
federal, state, and local laws or regulations applicable to the
Hazardous Material.
10.03 LESSEE shall not discharge, leak or emit, or permit to be
discharged, leaked or emitted, any material into the atmosphere,
ground, sewer system or any body of water, if that material (as is
reasonably determined by any governmental authority) does or may
pollute or contaminate the same, or may adversely affect (a) the
health, welfare or safety of persons, whether located on the Premises
or elsewhere or (b) the condition, use or enjoyment of the buildings
or any other real or personal property included in the Premises.
10.04 LESSEE shall promptly provide LESSOR with a copy of all
notices, reports and other communications sent to or received by any
governmental agency pursuant to or relating to LESSEE'S compliance
with, federal, state and local laws or regulations applicable to
Hazardous Material used, kept, stored or disposed of on the Premises
or relating to any determination of a governmental agency of the type
described in Section 10.03 above.
10.05 As used herein, the term "Hazardous Material" means (a)
any "hazardous waste" as defined by the Resource Conservation and
Recovery Act of 1976, as amended from time to time, and regulations
promulgated thereunder and (b) any "hazardous substance" as defined
by the Comprehensive Environmental Response Compensation and Liability
Act of 1980, as amended from time to time, and regulations promulgated
thereunder.
10.06 LESSEE hereby agrees that it shall be fully liable for all
costs and expenses related to the use, storage and disposal of
Hazardous Material kept on the Premises by LESSEE (except any
Hazardous Material used, stored or disposed of on the Premises prior
to the date hereof that might remain on the Premises after the date
hereof) and LESSEE shall give immediate notice to LESSOR of any
violation or potential violation of the provisions of Section 10.01,
10.02, or 10.03 that comes to its attention or knowledge. LESSEE shall
indemnify and hold LESSOR harmless from all damages, penalties,
claims, losses, liabilities, and expenses incurred by or imposed upon
LESSOR pursuant to any applicable federal or state environmental
statute where the damages, penalties, claims, losses, liabilities
or expenses arise out of or in connection with the presence of any
Hazardous Substance on or about the Premises caused as a direct result
of activities conducted by LESSEE after the date of this Lease other
than the excavation or removal by LESSEE of fly ash or other debris
found on the Premises before the date of this Lease, provided that
LESSEE will pay for the cost of actual excavation and removal of such
fly ash and other debris.
ARTICLE 11 - EASEMENT AND RIGHT OF WAY
11.01 LESSOR hereby grants and conveys to LESSEE, including
without limitation, LESSEE's contractors, subcontractors, vendors and
suppliers for the term of this Lease, an easement and right-of-way
(the "Easement" ~ for the assembly, construction, use, operation,
inspection and maintenance of the Facility, the Interconnection
Facilities and the extension of gas feeder lines to the Facility on
and across the property described on Exhibit B hereto.
EXECUTED EFFECTIVE June 9, 1989 in
[CORPORATE SEAL] THE XXXX COMPANY
ATTEST: By: Xxxx Xxxxx
Title: President
[CORPORATE SEAL] PANDA-XXXXXXXX CORPORATION
ATTEST: By: Xxxxxx X. Xxxxxx
Title: President
STATE OF TEXAS
COUNTY OF DALLAS
This 6th day of June, 1989, personally came before me, Xxxxxx Xxxxxx
a notary public, for the State of Texas who, being by me duly sworn, says
that she knows the Common Seal of Panda-Xxxxxxxx Corporation and is
acquainted with Xxxxxx X. Xxxxxx who is the President of said Corporation,
and that she, the said Xxxxx Xxxxxxxx is the Assistant Secretary of the
said Corporation, and saw the said President sign the foregoing instrument,
and saw the Common Seal of said Corporation affixed to said instrument by
said President, and that she, the said Assistant Secretary signed her name
in attestation of the execution of said instrument in the presence of said
President of said corporation.
Witness my hand and notarial seal or stamp this the 6th day of June,
1898.
(Notarial Seal or Stamp) Xxxxxx Xxxxxx
Notary Public
My commission expires:
7-6-93
STATE OF GEORGIA
COUNTY OF XXXX
This 9th day of June, 1989, personally came before me, Cater X. Xxxxxxxx
a notary public, X. X. Xxxxxx who, being by me duly sworn, says that he knows
the Common Seal of the Xxxx Company and is acquainted with Xxxx Xxxxx who is
the President of said Corporation, and that he, the said X. X. Xxxxxx is the
Assistant Secretary of the said Corporation, and saw the said President sign
the foregoing instrument, and saw the Common Seal of said Corporation
affixed to said instrument by said President, and that he, the said
X. X. Xxxxxx signed his name in attestation of the execution of said
instrument in the presence of said President of said corporation.
Witness my hand and notarial seal or stamp this the 9th day of June, 1989.
(Notarial Seal or Stamp)
My commission expires: Cater X. Xxxxxxxx
May 14, 1993 Notary Public
