HICKORY RIDGE LANDFILL LANDFILL GAS SALE AND PURCHASE AGREEMENT BETWEEN BFI WASTE SYSTEMS OF NORTH AMERICA, LLC AND GES LIVE OAK – HICKORY RIDGE, LLC November 14, 2008
EXHIBIT
10.8
HICKORY
RIDGE LANDFILL
BETWEEN
BFI
WASTE SYSTEMS OF NORTH AMERICA, LLC
AND
GES
LIVE OAK – HICKORY RIDGE, LLC
November 14,
2008
***** Certain
information in this exhibit has been omitted pursuant to a request for
confidential treatment. The omitted portions have been filed
separately with the Securities and Exchange Commission. We have
marked this exhibit where information has been omitted with
“*****”.
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CONTENTS
ARTICLE
1 – Definitions
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2
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ARTICLE
2 – Preliminary Acts of the Parties
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6
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ARTICLE
3 – Facilities
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10
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ARTICLE
4 – Landfill Gas Purchase/Sales/Acceptance
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11
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ARTICLE
5 – Title/Risk of Loss
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16
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ARTICLE
6 – Term and Right to Terminate
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17
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ARTICLE
7 – Gas Quality
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19
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ARTICLE
8 – Measurement
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21
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ARTICLE
9 – Price, Billing and Payment
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22
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ARTICLE
10 – Indemnity
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24
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ARTICLE
11 – Warranties and Representations
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25
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ARTICLE
12 – Insurance
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27
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ARTICLE
13 – Miscellaneous
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29
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EXHIBIT
A – FORM OF SITE LEASE
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EXHIBIT
B – EXAMPLE OF GROSS REVENUE CALCULATION
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This Landfill Gas Sale and Purchase
Agreement (this “Agreement”), executed and dated as of November 14, 2008 (“Effective Date”), is by and between
BFI Waste Systems of North America, LLC, a Delaware limited liability company,
with principal offices at 00000 Xxxxx Xxxxxx Xxx, Xxxxxxx,
Xxxxxxx 00000 (“Seller”), and GES Live Oak – Hickory Ridge, LLC, a
Georgia limited liability company (“Purchaser”), with principal offices at Suite
000, Xxxxx Xxxxx 200, 0000 Xxxxxxxxx Xxxx, XX, Xxxxxxx, Xxxxxxx 00000 (each of
Seller and Purchaser are referred to herein as “Party” and collectively as the
“Parties”), with reference to the following facts and
circumstances.
RECITALS
WHEREAS,
Seller owns and/or operates a landfill located at 0000 Xxxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxx 00000 (“Seller’s Site”), and Seller owns and/or controls the Landfill
Gas produced at Seller’s Site;
WHEREAS,
Seller desires to make available and sell Landfill Gas collected from current
and future operations of Seller’s Site to Purchaser;
WHEREAS,
Purchaser is currently negotiating to purchase a facility to convert Landfill
Gas into saleable processed gas (the “Processing Facility”) at the Live Oak
Landfill (“Live
Oak”),
located at 0000 Xxxxxxx Xxxx, Xxxxxx, Xxxxxxx 00000;
WHEREAS,
Purchaser desires to purchase Landfill Gas from Seller’s Site during the term of
this Agreement and in accordance with its terms and conditions, and if
successful in purchasing the Processing Facility, Purchaser plans to construct a
pipeline to deliver the Landfill Gas from Seller’s Site to the Processing
Facility;
WHEREAS,
whether or not Purchaser is successful in purchasing the Processing Facility,
Purchaser intends to install necessary equipment on Seller’s Site to provide any
processing of the Landfill Gas required either to transport the Landfill Gas to
Live Oak, to transport the Landfill Gas directly into a nearby gas main of
Atlanta Gas Light Company (the “AGL Main”), or otherwise to transport the
Landfill Gas to facilitate the sale thereof;
WHEREAS,
Purchaser intends to convert the Landfill Gas from the Seller’s Site into
processed gas (or an energy product thereof) and sell such gas to a Gas Buyer(s)
during the term of this Agreement and in accordance with its terms and
conditions; and
WHEREAS,
any other direct or indirect use of the Landfill Gas by Purchaser, other than
the processing of such Landfill Gas for resale, will be subject to the mutual
agreement of Purchaser and Seller, in their discretion.
TERMS AND
CONDITIONS
NOW, THEREFORE, in
consideration of the mutual agreements contained herein, and other good and
valuable consideration, receipt of which is hereby acknowledged, Seller and
Purchaser agree as follows:
ARTICLE
1
DEFINITIONS
1.1
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Accounting
Period means any period that begins on the first day of any
calendar month and ends on the last day of such calendar month during the
Contract Term, except that the first Accounting Period shall commence with
initial deliveries of Landfill Gas hereunder and end on the last day of
the calendar month in which such initial deliveries are
made.
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1.2
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Affiliate
means, with respect to Purchaser or Seller, as the case may be, any Person
that directly or indirectly owns fifty percent (50%) or more of Purchaser
or Seller, or any Person of which Purchaser or Seller directly or
indirectly owns at least fifty percent (50%) of the equitable interests,
or their respective parent entities, or any subsidiary of their respective
parent entities.
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1.3
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Agreement means
this Landfill Gas Sale and Purchase Agreement, including exhibits and
attachments, and all amendments and modifications hereafter executed by
the Parties hereto.
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1.4
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BTU means British
Thermal Unit, defined as the amount of heat required to raise the
temperature of one (1) pound of water one (1) degree Fahrenheit at a
temperature of sixty (60) degrees
Fahrenheit.
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1.5
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Commercial Operations
Date means the first date after which Purchaser’s Facilities have
been in continuous operation (i.e.,
processing and selling Landfill Gas to a Gas Buyer) for a fourteen (14)
consecutive day period during which the availability factor of Purchaser’s
Facilities meets or exceeds eighty percent (80%) calculated on an hourly
basis.
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1.6
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Contract Term
means the period commencing on the Effective Date and ending December 31,
2029.
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1.7
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Delivery Point
means the point on Purchaser’s Site and prior to the Purchaser’s
Facilities where Purchaser shall locate, own, operate, and maintain a
custody transfer meter and Landfill Gas quality
analyzer.
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1.8
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Effective Date
means the date this agreement is duly executed and delivered by both
Parties, as indicated above.
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2
1.9
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Environmental
Attributes means
any and all credits,
benefits, emissions reductions, offsets, and allowances, howsoever
entitled, attributable to the Purchaser’s Facilities, and its displacement
of conventional energy generation. Environmental Attributes
include but are not limited to: (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) and other greenhouse
gases (GHGs) that have been determined by the United Nations
Intergovernmental Panel on Climate Change 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 to these avoided emissions such
as Green Tag Reporting Rights. Green Tag Reporting Rights are
the right of a Green Tag purchaser 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 at the Green Tag
purchaser’s discretion, and include without limitation those Green Tag
Reporting Rights accruing under Section 1605(b) of The Energy Policy Act
of 1992 and any present or future federal, state, or local law, regulation
or xxxx, and international or foreign emissions trading
program. Green Tags are accumulated on kWh basis and one Green
Tag represents the Environmental Attributes associated with one (1) MWh of
energy. To the extent related and limited to the purchase and
sale of Landfill Gas contemplated hereby, Environmental Attributes also
include (i) any energy, capacity, reliability or other power attributes
from the Purchaser’s Facilities, (ii) production tax credits associated
with the construction or operation of Purchaser’s Facilities, Seller’s
Site or Seller’s Facilities, or any other associated contract or right,
and other financial incentives in the form of credits, reductions,
or allowances associated with the Purchaser’s Facilities, Seller’s Site or
Seller’s Facilities that are applicable to a state or federal income
taxation obligation.
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1.10
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Environmental
Laws means any
applicable federal, state, or local governmental law, statute, rule,
regulation, order, consent decree, decree, judgment, permit, license,
covenant, deed restriction, ordinance or other requirement or standard
relating to pollution or the regulation or protection of health, safety,
natural resources, or the environment, as now existing or hereafter in
effect, including, without limitation, those relating to releases,
discharges, emissions, injections, leachings, or disposals of hazardous
substances or hazardous materials into air, water, land or groundwater, to
the withdrawal or use of groundwater, or to the use, handling, treatment,
removal, storage, disposal, processing, distribution, transport, or
management of hazardous substances. "Environmental Laws" shall include,
but shall not be limited to, the Clean Air Act; the federal Water
Pollution Control Act; the Safe Drinking Water Act; the Toxic Substances
Control Act; the Comprehensive Environmental Response, Compensation and
Liability Act, as amended by the Superfund Amendments and Reauthorization
Act of 1986; the Resource Conservation and Recovery Act, as amended by the
Solid and Hazardous Waste Amendments of 1984; the Occupational Safety and
Health Act; the Hazardous Materials Transportation Act; the Oil Pollution
Act of 1990; and any similar federal, state or local statutes and
regulations.
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1.11
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Excess Gas
shall have the meaning set forth in Article
4.2.
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3
1.12
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Excess Gas Condition
shall have the meaning set forth in Article
4.2.
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1.13
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Gas Buyer means
any purchaser of processed or unprocessed Landfill Gas from Purchaser
pursuant to a Gas Purchase
Contract.
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1.14
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Gas Purchase
Contract means an agreement between Purchaser and a Gas Buyer for
the purchase of processed or unprocessed Landfill
Gas.
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1.15
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Governmental
Authority means any United States federal, state or local or any
foreign government, governmental, regulatory or administrative authority,
agency or commission or any court, tribunal, or judicial or arbitral
body.
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1.16
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Gross Revenue
means collected revenue received directly by Purchaser or its Affiliates
from or with respect to the sale of Landfill Gas from Seller’s Site, net
of any refunds of previously collected revenue resulting from Purchaser
overcharging its customers, together with (i) the value realized directly
or indirectly by Purchaser or its Affiliates with respect to any
Environmental Attributes derived by Purchaser or its Affiliates as a
result of the transactions or activities contemplated by this Agreement
and (ii) the value of any exchanged services or other in-kind exchanges
relating to the sale or use of Landfill Gas, if any. Purchaser
agrees to disclose to Seller any contractual provisions that provide for
any exchanged services or other in-kind exchanges in place of the receipt
of revenues relating to the sale of Landfill Gas, if any, it being the
intent of the parties that the market value of such in-kind exchanges, as
reasonably determined by the parties, will be included in the
determination of Gross Revenue. Purchaser and Seller
acknowledge that certain amounts of Purchaser’s Gross Revenue may be
derived from the sale of processed Landfill Gas that has been combined
with landfill gas drawn from Live Oak. To the extent that such
event occurs, the portion of such Gross Revenue attributable to Seller’s
Site from the combined processing of landfill gas from the two landfill
sites shall equal the total gross revenues derived by Purchaser from the
sale of processed landfill gas during the measurement period multiplied by
a fraction, the numerator of which shall be the total MMBTUs of Landfill
Gas drawn by Purchaser from Seller’s Site during the measurement period,
and the denominator of which shall be the combined MMBTUs of landfill gas
drawn from Seller’s Site and from Live Oak to the Processing Facility
during the measurement period. An example of the foregoing
calculation is attached hereto as Exhibit
B. Seller shall be allocated all other gross revenues
relating to the sale of Landfill Gas from Seller’s Site if such Landfill
Gas is not combined with landfill gas from Live Oak. If Seller
and Purchaser, in their discretion, mutually agree upon any other use by
Purchaser of Landfill Gas other than the processing, transportation and
sale of Landfill Gas as contemplated herein, the determination of value
for purposes of this definition shall be as mutually agreed upon by Seller
and Purchaser, in their discretion.
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1.17
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Higher Heating
Value shall mean the amount of heat released when a known volume of
hydrocarbon (i.e., Landfill
Gas) is burned.
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4
1.18
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Landfill Gas
means gas generated from the decomposition of refuse and other solid
wastes deposited or located on Seller’s Site and collected by Seller’s
Facilities.
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1.19
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Modifications
shall have the meaning set forth in Article
4.6.
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1.20
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Person means an
individual, partnership, corporation (including a business trust), limited
liability company, joint stock company, trust, unincorporated association,
joint venture, or other entity, or a government or any political
subdivision or agency thereof, or any trustee, receiver, custodian, or
similar official.
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1.21
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Purchaser means
GES Live Oak – Hickory Ridge, LLC, a Georgia limited liability company,
with principal offices at Suite 000, Xxxxx Xxxxx 200, 0000 Xxxxxxxxx Xxxx,
XX, Xxxxxxx, Xxxxxxx 00000.
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1.22
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Purchaser’s
Facilities means the fixtures, equipment and assets of Purchaser,
whether owned or leased by Purchaser that are used by Purchaser in the
performance of Purchaser’s business and are currently or may in the future
be located on Purchaser’s Site, subject to the terms and conditions of a
Site Lease Agreement. Purchaser’s Facilities may also include,
but shall not be limited to: (i) a pipeline suitable to transport Landfill
Gas from the Delivery Point to the Purchaser’s processing and conversion
equipment at the Live Oak landfill; (ii) a pipeline suitable to transport
Landfill Gas from Purchaser’s Site to the AGL Main or elsewhere for sale;
(iii) all equipment and pipelines necessary or convenient for Purchaser to
process the Landfill Gas on Purchaser’s Site into a saleable product; (iv)
all equipment that may be required for the connection of the existing
blower(s) to the Delivery Point (including all control systems necessary
to automatically direct Landfill Gas to Seller’s Flare when Purchaser does
not purchase and/or accept Landfill Gas from Seller pursuant to this
Agreement or Purchaser’s Facilities do not or cannot process such Landfill
Gas); (v) backup generators that would allow Purchaser to operate the
Purchaser’s Facilities in the event of a power loss and that would also
generate enough electricity in the event of a power loss for Seller to be
able to run a flare system, provide Landfill Gas to the Delivery Point and
pump condensate offsite for disposal; and (vi) metering equipment,
compressors, dehydration units and/or other landfill gas processing
equipment used for collecting, producing and delivering or facilitating
the collection, production and delivery of processed Landfill
Gas, or as the same is modified, expanded and/or
replaced.
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1.23
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Purchaser’s
Site means that certain real estate upon which the Purchaser’s
Facilities will be located, which real estate shall be leased from Seller
pursuant to the terms and conditions of a Site Lease
Agreement.
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1.24
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Qualifying Landfill
Gas means Landfill Gas meeting the minimum standards described in
Article 7.1.
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5
1.25
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Section 29 Tax
Credits means those Tax Credits available under Section 29 of
Subtitle A, Chap. 1A, Part IV of the Internal Revenue Code of 1986, as
amended from time to time (or any successor
provision).
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1.26
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Seller means
BFI Waste Systems of North America, LLC, a Delaware limited liability
company, with offices at 00000 Xxxxx Xxxxxx Xxx, Xxxxxxx, Xxxxxxx
00000.
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1.27
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Seller’s
Facilities means the
fixtures, equipment and assets of Seller, whether owned or leased by
Seller that are either used by Seller in the performance of Seller’s
business or are currently or may in the future be located on Seller’s Site
up to the Delivery Point and includes, but is not limited to, the wells,
pipes, headers and gathering systems, flares, vacuum pipelines, blowers,
condensate knockout vessels or systems and all other fixtures, equipment
and assets that are used for the purpose of collecting, producing and
delivering or facilitating the collection, production and delivery of
Landfill Gas, as such exists as of the Effective Date or as the same may
be modified, expanded and replaced. The term “Seller’s
Facilities” shall not include the Purchaser’s
Facilities.
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1.28
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Seller’s Flare
means the combustion and control system flare(s) owned and operated by
Seller at Seller’s Site.
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1.29
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Seller’s
Site means the Hickory
Ridge Landfill located at 0000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxx
00000.
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1.30
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Site Lease
Agreement means a separate Site Lease Agreement to be entered into
between Purchaser and Seller.
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1.31
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Tax Credits
means all or any of the credits against or with reference to any federal,
state, or local taxes.
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1.32
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Work means any
and all efforts performed by Purchaser to modify Seller’s Facilities to
redirect Landfill Gas to the Delivery Point, as more specifically
described in Article 2.6.
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ARTICLE
2
PRELIMINARY ACTS OF THE
PARTIES
2.1
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Permits,
Authorizations. Seller will use commercially reasonable
efforts to timely and promptly obtain all necessary permits and
authorizations, if any, required to deliver Landfill Gas to Purchaser in
accordance with this Agreement. Seller shall provide Purchaser
reasonable written notice prior to filing for, or requesting, any permit,
authorization, zoning change, consent, or approval (or any modification of
any of the foregoing) related to this Agreement. Any permits
and authorizations relating primarily to the Purchaser’s Facilities or
Purchaser’s business operations shall be the sole responsibility and
obligation of Purchaser. Purchaser shall provide Seller
reasonable written notice prior to filing for, or requesting, any permit,
authorization, zoning change, consent, or approval (or any modification of
any of the foregoing) related to the Purchaser’s Facilities, Purchaser’s
Site, or Purchaser’s business operations related to this
Agreement. Upon written request, each Party shall provide the
other with a copy of the application and status of the permits and
authorizations described above. Notwithstanding any other
provision of this Agreement, Purchaser shall not be obligated to commence
or continue design or construction of the Purchaser’s Facilities or of any
additions, improvements or modifications thereto, or of any modifications
to Seller’s Facilities, except to the extent that Purchaser and Seller
have obtained all necessary permits and authorizations therefore and
Purchaser has entered into one or more Gas Purchase Agreements upon terms
and with respect to quantities of Landfill Gas sufficient in Purchaser’s
sole and absolute discretion to render such facilities economically viable
and advisable, taking into account (among other matters) the financial
terms of this Agreement. Purchaser will use commercially
reasonable efforts to enter into one or more Gas Purchase Agreements
acceptable to it and to obtain all such necessary permits and
authorizations. This Article 2.1
shall in no way limit or modify Seller’s rights set out in Article 6
below.
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6
2.2
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Mutual
Assistance. Each Party shall be responsible for the
acquisition and payment of their respective permits and
authorizations. However, upon written request, the Parties
hereto shall use commercially reasonable efforts to support and assist one
another in the acquisition of any required permit or authorization to
fulfill the obligations hereunder, and the assisting Party shall be
reimbursed its out-of-pocket costs by the Party that requested the support
and assistance. Such support shall include, without limitation,
participation in regulatory proceedings and provision of relevant
non-confidential information concerning each Party’s
operations. If either Party, in its sole and absolute
discretion, provides confidential information to the other Party in
connection with such support, the Party receiving such confidential
information shall comply with the provisions of Article
13.12.
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2.3
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Site Lease
Agreement. No later than one hundred twenty (120) days
after the execution of this Agreement and at no additional cost or
expense, Purchaser and Seller shall enter into a Site Lease Agreement in a
form substantially similar to the form attached hereto as Exhibit A;
provided, however, the Site Lease Agreement shall include a grant to
Purchaser of all necessary easements for pipelines and other
infrastructure located outside Purchaser’s Site (and located on Seller’s
Site) but related to the Purchaser’s Facilities, Purchaser’s Site, or
Purchaser’s business operations as to this
Agreement.
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2.4
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Public Utility
Status. Neither Party hereto shall hold itself out as a
public utility or submit to the jurisdiction of the Georgia Public Service
Commission (“GPSC”), or any other local, state or federal agency by reason
of the extraction, purchase, treatment, delivery, transfer or sale of
Landfill Gas hereunder without being required to do so under applicable
laws. If, for any reason, either Party is considered a public
utility by the GPSC such that its rates, charges, rules, regulations,
service, financing, accounts, and such other matters involving a privately
owned gas public utility distribution system are subject to the regulation
or jurisdiction of the GPSC as provided for under O.C.G.A. §46-4-1, et
seq., or other appropriate Governmental Authority, such Party agrees to
use reasonable, good faith efforts to obtain relief from such regulations,
in the form of a waiver or some other relief acceptable to such
Party. If such Party is unable to obtain the waiver or relief
requested, and the GPSC or other appropriate Government Authority
continues to attempt to subject the Party to regulation as a public
utility, such Party may, upon at least sixty (60) days written notice to
the other Party, terminate this Agreement and have no further obligations
hereunder except for any obligation identified in Article 6.4
herein. Notwithstanding the foregoing, in the event that
Purchaser’s construction of a pipeline to deliver the Landfill Gas from
Seller’s Site to the Processing Facility or the AGL Main or elsewhere
subjects Purchaser to the jurisdiction of the GPSC or any other local,
state or federal agency, and Purchaser consents to such jurisdiction, this
Agreement shall not terminate under this Article 2.4; provided that such
treatment of Purchaser does not have a material adverse effect on Seller
or require Seller to be treated as a public utility by
GPSC. Notwithstanding anything else herein to the contrary, the
Parties acknowledge that the GPSC has safety jurisdiction over all natural
gas pipelines constructed in Georgia and the exercise of such jurisdiction
over any pipelines contemplated by this Agreement shall not provide either
Party a right to terminate this
Agreement.
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7
2.5
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Construction of
Purchaser’s Facilities. Subject to the other provisions
in this Agreement and at no cost to Seller, Purchaser shall construct and
install the Purchaser’s Facilities. The Purchaser’s Facilities
may include any of the equipment or facilities described in Article 1.22
but at a minimum shall include, without
limitation:
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(a)
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All
equipment required for the connection of the Purchaser’s Facilities and
Seller’s Facilities at the Delivery
Point;
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(b)
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A
pipeline suitable to transport Landfill Gas from the Delivery Point to the
Processing Facility, to the AGL Main, or to another location for sale;
and
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(c)
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The
metering and measuring equipment described in Article
8.1.
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2.6
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Modification of
Seller’s Facilities. Purchaser shall, at no cost to
Seller, modify Seller’s Facilities as necessary to redirect Landfill Gas
to the Delivery Point. Prior to making any modifications to
Seller’s Facilities required for connecting Seller’s Facilities to the
Delivery Point, Purchaser shall provide Seller with a full set of
drawings, such that Seller can conduct a design review and approval that
shall be limited to issues directly relating to compatibility with
Seller’s Facilities. Seller shall complete any design review
within thirty (30) days after receipt of the drawings and agrees not to
unreasonably withhold, condition, or delay such
approval. Seller’s review and/or approval of such design shall
not be deemed a warranty or representation of any kind as to the design,
suitability, capability, or expected performance of the Purchaser’s
Facilities or operations. Title to all equipment required to
modify Seller’s Facilities as provided in this Article 2.6 shall pass to
Seller free and clear of all liens, claims, encumbrances and security
interests as of the date of the incorporation of such equipment into
Seller’s Facilities, and Purchaser shall execute and deliver to Seller
such lien waivers and other documents reasonably requested by
Seller.
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8
Purchaser
will perform any modifications to Seller’s Facilities required pursuant to this
Article 2.6 (the “Work”) with qualified persons in such a manner as to take all
reasonable precautions to prevent the disruption of Seller’s Site, Seller’s
Facilities and Seller’s operations. Seller will have the right to
monitor the Work as well as the right to suspend any activity it reasonably
believes in good faith contravenes Seller’s Site safety/work practices or could
materially and adversely impact Seller’s Site, Seller’s Facilities or Seller’s
operations. Purchaser shall conduct the Work in a manner consistent
with all applicable laws, rules, regulations, and orders including, without
limitation, Environmental Laws, occupational safety, and health
laws. Purchaser acknowledges that hazards may be involved in
performing the Work. Accordingly, Purchaser shall perform the Work in
accordance with good industry practices, shall take necessary precautions in the
removal, handling, transporting, and disposing of material and product involved
in the Work, and shall take reasonable precautions to avoid an unhealthy or
unsafe work environment, injuries to persons, damage to property, or
pollution.
Purchaser
and Seller acknowledge that the intent of this Article 2.6 is to ensure that the
Parties cooperate in good faith to maximize the production and collection of
Qualifying Landfill Gas in an effort to maximize the Parties’ mutual economic
benefits under this Agreement while complying with all applicable laws and
permit conditions, but in all cases, subject to the provisions of Article 2.7,
below.
2.7
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Priority of Landfill
Operations. Notwithstanding anything herein to the
contrary, Purchaser understands and agrees that Seller’s primary interest
and obligation are the safe and efficient operation of Seller’s Site, in
compliance with applicable laws and permit conditions, and that any
interest of Purchaser in the Landfill Gas shall remain secondary to the
operation of Seller’s Site. Purchaser’s rights and interests
hereunder shall not interfere with Seller’s compliance with any permit
related to Seller’s Facilities, or with the lawful and safe operation of
Seller’s Site, including the design, construction, operation, maintenance,
monitoring, closure, and post-closure of Seller’s Site. Seller
may, in emergency circumstances, operate its blowers and flares
independent of Purchaser, if Seller deems necessary. Subject to
the foregoing, Seller and Purchaser will work together in good faith to
attempt to minimize adverse impacts to the Landfill Gas flow and
Purchaser’s operations resulting from Seller’s primary interest and
obligation; provided that nothing in this Agreement shall require Seller
to incur out-of-pocket expenses in taking any actions that are not
required to be taken by Seller in this Agreement with respect to
compliance with applicable laws and permits relating to Seller’s Site and
Seller’s operations (without taking into account Purchaser’s activities
for purposes of making the foregoing
determination).
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9
2.8
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Return of Project
Development Payment. Notwithstanding anything herein to
the contrary, during the period from the date hereof through the earlier
of the Commercial Operations Date or December 31, 2010, Purchaser shall
have the option to terminate this Agreement on written notice to Seller
and promptly receive reimbursement from Seller of the entire amount of the
Project Development Payment if Seller fails to use commercially reasonable
efforts (i) to secure all permits, authorizations, licenses and approvals
(or modifications of any of the foregoing) required to be obtained by
Seller with respect to the activities contemplated herein, and (ii) at no
out of pocket cost to Seller, to assist Purchaser in making application
for and obtaining, all other permits, authorizations, zoning changes,
consents, licenses and approvals (or modifications of any of the
foregoing) required to be obtained with respect to the activities
contemplated herein; provided that if at any time Purchaser believes that
Seller is not acting in a commercially reasonable manner, it shall give
written notice to Seller including reasonable detail of any alleged
failure of Seller to fulfill its obligations, and a reasonable opportunity
to cure any such alleged failure. The period within which
Purchaser may terminate and receive reimbursement of the Project
Development Payment shall be extended by the same amount of time that
Seller is determined not to have been using such commercially reasonable
efforts prior to curing such
failure.
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ARTICLE
3
FACILITIES
3.1
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Purchaser’s
Facilities. Purchaser shall be responsible for all costs
and expenses to construct, install, maintain, and operate the Purchaser’s
Facilities (including, but not limited to, utilities
expense). At all times during the term hereof, the Purchaser’s
Facilities shall be designed, constructed, maintained and operated in
compliance with all applicable permits, laws and regulations, including
without limitation Environmental Laws. The Purchaser’s
Facilities shall include equipment to automatically route Landfill Gas to
and start Seller’s Flare in the event the Purchaser’s Facilities are
inoperative, or Purchaser is not fully utilizing the Landfill
Gas. In the event the Purchaser’s Facilities are inoperative
for a period of five (5) consecutive days, Purchaser shall provide written
notice to Seller of such fact and provide an estimate of the date by which
the Purchaser’s Facilities shall be operative. Purchaser shall
retain all rights to any Environmental Attribute, tax, emission or other
credits with respect to the handling, processing and sale of Landfill Gas
downstream of the Delivery Point, including without limitation,
Purchaser’s operations, Purchaser’s Facilities, and the purchase of
Landfill Gas by Gas Buyer(s) from Purchaser, or using Landfill Gas as a
fuel, including without limitation, Renewable Energy Production Incentive
Payments from the U.S. Department of Energy, and any credits realized in
connection with the generation of energy, or the generation of electricity
for its own account (if such use is mutually approved by the Parties), or
the combustion of Landfill Gas by the Purchaser’s
Facilities. Notwithstanding the foregoing, any Environmental
Attribute, tax, emission or other credits that may be taken by Purchaser
and Seller, but not both, shall be shared in the manner contemplated by
Article 9.5, with the exception that any tax, emission or other credits
that would be available to Seller without regard to Purchaser’s activities
hereunder shall remain with Seller.
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10
3.2
|
Seller’s
Facilities. Seller is responsible for the ownership,
operation, and maintenance of Seller’s Facilities. Seller shall
be solely responsible for the design, engineering, construction,
installation and cost of operation and maintenance of Seller’s Facilities,
including the construction, operation and maintenance of Landfill Gas
collection and destruction facilities necessary for health and safety, to
prevent migration of Landfill Gas onto adjacent properties, and to comply
with applicable federal, state and local regulatory requirements for
control of Landfill Gas emissions from Seller’s Facilities (provided
however that any costs associated with the Modification of Landfill Gas
collection and destruction facilities shall be borne by Purchaser to the
extent set forth in Article 4.6
herein).
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3.3
|
Seller’s Compliance
Obligations; Certain Credits. Seller shall design,
construct, install, operate and maintain Seller’s Facilities in accordance
with regulatory requirements of 40 CFR Part 60, Subpart WWW, Standards of
Performance For New Stationary Sources. Notwithstanding the
foregoing, Seller shall be responsible for operation and maintenance costs
and expenses related to the Seller Facilities only to the extent required
for compliance with its permits and laws, rules and regulations applicable
to Seller’s landfill operations and Seller’s Site, or as otherwise
required under this Agreement. Seller shall retain all rights
to any Environmental Attribute, tax, emission or other credits with
respect to the handling of Landfill Gas upstream of the Delivery Point,
including without limitation, Seller’s Site, Seller’s operations and
Seller’s Facilities, including further, without limitation, the flaring or
other combustion of Landfill Gas by Seller’s Facilities, the sale of
Landfill Gas to Purchaser, and Section 29 Tax Credits and similar Tax
Credits. Notwithstanding the foregoing, any Environmental
Attribute, tax, emission or other credits that may be taken by Purchaser
and Seller, but not both, shall be shared in the manner contemplated by
Article 9.5, with the exception that any tax, emission or other credits
that would be available to Seller without regard to Purchaser’s activities
hereunder shall remain with Seller. Each Party shall be
responsible for the purchase of its own emission credits and/or offsets,
as required.
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ARTICLE
4
LANDFILL GAS
PURCHASE/SALES/ACCEPTANCE
4.1
|
Purchase and
Sale. Beginning on the Effective Date, and subject to
the terms and conditions of this Agreement, Purchaser shall have the
exclusive right to purchase from Seller all Landfill Gas produced at
Seller’s Site for processing and sale to Gas Buyer(s) pursuant to a Gas
Purchase Contract(s). Seller shall use commercially reasonable
efforts to provide and sell to Purchaser such Landfill Gas produced at
Seller’s Site in accordance with the terms and conditions of this
Agreement.
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4.2
|
Excess
Gas. Notwithstanding any other term of this Agreement to
the contrary, if at any time following the Commercial Operations Date
Purchaser fails to process and sell at least fifty percent (50%) of the
Qualifying Landfill Gas made available by Seller over a rolling
one hundred eighty (180)-day period (herein defined as an “Excess Gas
Condition”), in addition to Seller’s right to terminate this Agreement as
provided in Article 6.2(f), Seller shall have the option to provide
Purchaser written notice (herein defined as an "Excess Gas Notice") that
Seller wishes to sell Qualifying Landfill Gas in excess of the average
percentage of Qualifying Landfill Gas processed and sold by Purchaser over
the rolling one hundred eighty (180)-day period (“Excess Gas”) to a third
party on a permanent basis. Upon receipt of an Excess Gas
Notice, Purchaser must within sixty (60) days commence purchasing no less
than fifty percent (50%) of all Qualifying Landfill Gas made available by
Seller, or lose the right to purchase the Excess
Gas.
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11
Should Purchaser fail to meet the
forgoing conditions, the Excess Gas shall be released to Seller for sale to a
third party, and the maximum amount of Qualifying Landfill Gas that Seller is
required to make available to Purchaser hereunder shall be reduced to
Purchaser’s average percentage use over the above-referenced rolling one hundred
eighty (180)-day measurement period.
Notwithstanding
the above, Purchaser shall not lose any rights to Landfill Gas if and for so
long as it processes and sells or otherwise pays (and continues to pay) Seller
for no less than fifty percent (50%) of the Qualifying Landfill Gas no more than
sixty (60) days from and after Purchaser’s receipt of the Excess Gas
Notice. The amount payable to Seller for any Qualifying Landfill Gas
not otherwise processed and sold by Purchaser shall be determined by estimating
the Gross Revenue that would be derived by Purchaser if Purchaser were to
utilize, process and sell the Qualifying Landfill Gas on the same basis and with
the same efficiencies that Purchaser utilizes, processes and sells Qualifying
Landfill Gas in general and paying Seller the amount that it would be due in
accordance with this Agreement.
4.3
|
Seller
Operations. Seller shall use commercially reasonable
efforts to provide Purchaser with Qualifying Landfill Gas over the term of
this Agreement. Such commercially reasonable efforts shall
include, but not necessarily be limited to, the
following:
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(a)
|
Seller
will maintain in full force and effect all permits, approvals,
certificates of occupancy and licenses required to deliver Landfill Gas to
Purchaser as provided hereunder. Subject to Article 2.7, Seller
agrees to use commercially reasonable efforts to maximize Qualifying
Landfill Gas production and to provide sufficient competent, knowledgeable
and fit personnel to lawfully and properly perform its obligations
hereunder;
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12
(b)
|
The
Parties recognize and acknowledge that careful and proper tuning of the
xxxxx, including diverting poor quality xxxxx to Seller’s Flare, is likely
to maximize the delivery of Qualifying Landfill Gas to the Delivery Point
such that the Parties’ mutual economic benefits under this Agreement may
be realized. Subject to the provisions of Article 2.7, and any
other limitations set forth in this Agreement, the Parties agree to
cooperate in good faith to accomplish such goal; provided that the cost of
any diversion of the Landfill Gas shall be the sole responsibility of
Purchaser. Accordingly, subject to the above-referenced
limitations, Seller shall tune the well field on Seller’s Site, from time
to time as needed, in accordance with generally accepted landfill
operating practices with the objective of maximizing the delivery of
Qualifying Landfill Gas to the Delivery Point. Tuning of the
well field shall be accomplished by the use of a experienced, qualified
well field technician, and commencing on the Commercial Operations Date,
Purchaser shall pay to Seller the amount of eighty thousand dollars
($80,000) annually, as may be adjusted thereafter on an annual basis, to
take into account changes in the Bureau of Labor Statistics’ Atlanta CPI
series CUURA A319SA0, which payment shall be used by Seller solely to pay
the costs of a qualified well field technician. Such well field
technician shall be primarily dedicated to Seller’s Site and shall,
personally or through a designated backup reasonably acceptable to
Purchaser, be required to be on call seven (7) days a week, twenty-four
(24) hours a day, and his/her primary purpose shall be to assist the
operation of Seller’s Landfill Gas collection system at Seller’s Site in
cooperation with Purchaser as provided herein. As used in this
section, “primarily dedicated” means that such technician shall spend at
least an average of thirty (30) hours during each week at Seller’s Site,
computed on a quarterly basis. The well field technician shall
so assist Purchaser in tuning xxxxx with the objective of optimizing the
production of Qualifying Landfill Gas, so long as such tuning does not
cause Seller’s noncompliance with Environmental Laws or otherwise
interfere with Seller’s operations as contemplated in Article
2.7. Purchaser shall have the right to communicate on an as
needed basis directly with the well field technician and provide input on
the tuning of the xxxxx, including the diversion of poor quality xxxxx to
Seller’s Flare, and such input shall be incorporated into the practices of
the well field technician unless such input contributes to Seller’s
non-compliance with Environmental Laws or permits or creates unsafe
conditions. Payment by Purchaser to Seller of the amount for
such technician shall be made at times and by methods mutually agreed upon
by the Parties. At Purchaser’s sole cost and expense, Purchaser
shall provide the well technician with a portable gas chromatograph, and
shall replace or repair such equipment in the event of malfunction, and
instruct the technician how to use the
instrument;
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(c)
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Seller
shall install and maintain the landfill cap at Seller’s Site in accordance
with regulatory requirements and authorizations. Seller will
provide to Purchaser copies of any proposals it makes with regard to its
proposed closure and post-closure plans to give Purchaser the opportunity
to make recommendations with regard to the closing of Seller’s Site and
the expansion, operation and maintenance of the Landfill Gas collection
facilities to maximize the collection of Qualifying Landfill
Gas. If any of Purchaser’s recommendations are acceptable to
Seller and the implementation thereof results in any incremental cost or
expense to Seller, Purchaser shall agree to bear responsibility for such
incremental cost and expense. Seller shall not unreasonably
deny, delay, or condition any such recommendation of
Purchaser.
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(d)
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Seller
shall maintain the gas xxxxx in accordance with all applicable laws, and
with the objective of maximizing the delivery of Qualifying Landfill Gas
to Purchaser, subject to the provisions of Article 2.7 and any other
limitations set forth in this
Agreement;
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13
(e)
|
Seller
shall tie future Landfill Gas collection facilities at Seller’s Site into
the existing Landfill Gas collection and distribution system so that any
future quantities of Landfill Gas are available to Purchaser at the
Delivery Point; and
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(f)
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Seller
shall notify the Purchaser of an outage for scheduled maintenance of
Seller’s Facilities as soon as reasonably practicable, but in no event
less than ten (10) days in advance. Such scheduled maintenance
shall be coordinated with Purchaser so as to minimize any interference
with the operation of the Purchaser’s Facilities. For
non-scheduled or emergency maintenance of Seller’s Facilities, Seller
shall notify Purchaser as soon as reasonably practicable after it becomes
aware of such required maintenance. Purchaser shall notify
Seller of an outage for scheduled maintenance of Purchaser’s Facilities as
soon as reasonably practicable, but in no event less than ten (10) days in
advance. Such scheduled maintenance shall be coordinated with
Seller so as to minimize any interference with the operations of
Seller. For non-scheduled or emergency maintenance of
Purchaser’s Facilities, Purchaser shall notify Seller as soon as
reasonably practicable after it becomes aware of such required
maintenance.
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4.4
|
Purchaser
Operations. Purchaser shall be obligated to comply with
all requirements and obligations that relate to Purchaser and Purchaser’s
purchase, processing or transmission of the Landfill
Gas. Purchaser shall use commercially reasonable efforts to
increase the Landfill Gas processing capacity of its processing facilities
to accommodate any increase in the supply of Qualifying Landfill Gas
resulting from any expansion or other modification of, or physical change
to, Seller’s Site or Seller’s Facilities. The Parties
anticipate that, as of the Commercial Operations Date, the Purchaser’s
Facilities will have a processing capacity of at least two thousand two
hundred (2,200) standard cubic feet of Landfill Gas per
minute.
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4.5
|
Commercial Operations
Date. Purchaser anticipates that the Commercial
Operations Date will occur prior to December 31, 2010 (the “Target
Date”). If the Commercial Operations Date has not occurred by
that time, Seller agrees not to exercise its option to terminate as
provided in Article 6.2(d), and will provide Purchaser an extension beyond
that date, but in no event later than December 31, 2012 (the “Extension
Date”), so long as Purchaser pays Seller fifty percent (50%) of the
applicable compensation that would have been paid to Seller if Purchaser
were to have processed and sold all Qualifying Landfill Gas made available
by Seller at the then current NEW YORK MERCANTILE EXCHANGE monthly
settling price for Natural Gas (“NYMEX”) (using the same assumptions for
determining assumed Gross Revenues as described in Article 4.2); provided,
however, the Target Date and the Extension Date shall be extended without
additional payment by Purchaser (i) to the extent any such delay is a
result of Seller’s breach of any term or condition of this Agreement,
and/or (ii) to the extent any such delay is a result of Purchaser’s or
Seller’s inability, with the exercise of due diligence, to obtain the
permits or approvals necessary to conduct the operations contemplated by
this Agreement, and/or (iii) to the extent any such delay is a result of
AGL’s failure to complete construction of the pipeline(s) necessary to
transport the Landfill Gas from Purchaser’s Site, and/or (iv) by the
number of days that Purchaser can reasonably demonstrate that its ability
to achieve Commercial Operations prior to the Target Date were caused
primarily by Seller’s closure and/or post-closure
activities. Any delay of the nature described in subsection
(iv) above shall be taken into account only if Purchaser can demonstrate
that Seller’s closure/post-closure activities demonstrably affected
Purchaser’s ability to construct and put in place in a timely manner
Purchaser’s Facilities at Seller’s Site necessary to process and transmit
Landfill Gas or negatively affect the quality of the Landfill Gas such
that it does not meet the standards set forth in Article
7.1.
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14
4.6
|
Purchaser
Modifications. In addition to any rights or remedies it
may have elsewhere in this Agreement, Purchaser shall have the right,
subject to the prior written approval of Seller (which approval shall not
be unreasonably withheld, delayed or conditioned), and at Purchaser’ sole
cost and expense, to implement improvements and/or modifications and
related repairs to Seller’s Facilities that are intended to result in
enhanced quality or quantity of Qualifying Landfill Gas transmitted to the
Delivery Point (collectively, “Modifications”); provided that, in no way
limiting the foregoing, it shall be deemed reasonable for Seller to reject
any proposed Modifications that would increase Seller’s costs of operation
unless Purchaser agrees to reimburse Seller for such additional
incremental costs directly or through increased royalty payments to Seller
that result directly from the proposed Modifications. To the
extent any such Modifications are necessary or would in the future be
necessary to enable Seller to comply with applicable laws, rules,
regulations, or orders, Purchaser may, subject to amendment of this
Agreement, at the time such Modifications are or become so necessary,
offset the reasonable cost of such Modifications against any amounts it
owes Seller under this Agreement; provided that Purchaser disclosed such
fact and the related costs in connection with the approval process; and
further provided, that if this Agreement terminates for any reason, other
than a breach hereof by Purchaser, before Purchaser has been reimbursed
such cost, then Seller shall pay Purchaser the remaining unreimbursed
amount in cash within thirty (30) days following such
termination.
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Any
such Modifications made by Purchaser to Seller’s Facilities shall become
the sole property and responsibility of Seller upon completion
thereof. Should there be an interruption or cessation of, or a
material reduction in, the anaerobic generation of Landfill Gas from
Seller’s Site, such that Purchaser cannot draw Landfill Gas therefrom,
Seller’s obligation to install new xxxxx, piping and other equipment shall
be limited to such changes and corrective measures as are required by
applicable laws, rules and regulations in the landfill
industry. However, the provisions set forth in this Article 4.6
regarding Purchaser’s right to implement Modifications shall continue to
apply.
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15
4.7
|
Implementation of
Purchaser Modifications. Prior to making any
Modifications, Purchaser shall provide Seller with a full set of plans and
drawings of such Modifications, such that Seller can conduct a design
review and approval, which approval may be withheld in Seller’s sole and
absolute discretion. Seller shall complete any design review
within thirty (30) days after receipt of the full set of plans and
drawings; provided, however, that if Seller does not approve such plans
and drawings in writing within such thirty (30) day period, Seller shall
be deemed to have not approved such plans and
drawings. Seller’s review and/or approval of such plans and
drawings shall not be deemed a warranty or representation of any kind as
to the design, suitability, capability or expected performance of any
Modifications. Seller’s failure to review and/or approve such
plans or drawings shall not release Purchaser from any obligations
hereunder nor shall it be deemed a waiver of any of Seller’s rights or
remedies under this Agreement. Title to all Modifications that
are permanently affixed to Seller’s Facilities or Seller’s Site (which
excludes Purchaser’s Site and Purchaser’s Facilities) shall pass to Seller
free and clear of all liens, claims, encumbrances and security interests
as of the date of the incorporation of such equipment into Seller’s
Facilities or Seller’s Site, as applicable, and Purchaser shall execute
and deliver to Seller such lien waivers and other documents reasonably
requested by Seller.
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Purchaser
will perform all work in connection with any Modifications with qualified
persons in such a manner as to take all reasonable precautions to prevent the
disruption of Seller’s Site, Seller’s Facilities and Seller’s
operations. Seller will have the right to monitor the progress of any
Modifications as well as the right to suspend any activity it believes
contravenes safety/work practices at Seller’s Site, or could materially and
adversely impact Seller’s Site, Seller’s Facilities or Seller’s
operations. Purchaser shall conduct all work relating to any
Modifications in a manner consistent with all applicable laws, rules,
regulations, and orders including, without limitation, Environmental Laws, and
occupational safety and health laws. Purchaser acknowledges that
hazards may be involved in performing work in connection with any
Modifications. Accordingly, Purchaser shall perform all work in
connection with any Modifications in accordance with good industry practices,
shall take necessary precautions in the removal, handling, transporting and
disposing of material and product involved in such work, and shall take
reasonable precautions to avoid an unhealthy or unsafe work environment,
injuries to persons, damage to property, or pollution. Promptly
following completion of any Modification, Purchaser shall restore Seller’s
Facilities and Seller’s Site, as applicable, as near to their condition prior to
the commencement of such Modification as is reasonably practicable.
ARTICLE
5
TITLE/RISK OF
LOSS
5.1
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Title to Landfill
Gas. Subject to Purchaser’s rights set out in Article
7.5, title to and control and possession of the Landfill Gas sold
hereunder shall pass from Seller to and be absolutely vested in Purchaser
at the Delivery Point, and liability for and the risk of loss of such
Landfill Gas shall follow title; provided that nothing in the preceding
sentence shall affect Seller’s obligations or liabilities under this
Agreement.
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16
ARTICLE
6
TERM AND RIGHT TO
TERMINATE
6.1
|
Term. This
Agreement shall become effective on the Effective Date and, unless
terminated in whole or part earlier as provided in this Article 6, shall
continue in effect through the Contract Term, and after the expiration of
the Contract Term, this Agreement may be extended for successive terms
only upon the mutual written agreement of the Parties, in their
discretion.
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6.2
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Seller’s Right to
Terminate. Seller may terminate this Agreement by
written notice to Purchaser upon the occurrence of any of the following
events:
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(a)
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Purchaser
fails to perform any material obligation hereunder, and fails to cure such
failure to perform within thirty (30) days after receipt of Seller’s
notice of such failure of performance, or if such cure cannot be completed
in thirty (30) days, Purchaser fails to promptly initiate, diligently
pursue, and implement such cure in a prompt fashion, taking into
consideration the nature of the circumstances; provided that in no event
shall the cure period be extended longer than a total of one hundred
eighty (180) days; or
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(b)
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Purchaser
has breached any material representation, warranty, covenant or agreement
contained in this Agreement; or
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(c)
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Purchaser
fails to perform its obligations under this Agreement due to an event of
Force Majeure that lasts longer than one hundred eighty (180) days,
provided that Seller is willing and able during such time to deliver
Qualifying Landfill Gas to Purchaser hereunder; provided however, Seller
may not terminate the Agreement under this subsection (c) if, at the end
of such 180-day period, Purchaser commences paying Seller fifty percent
(50%) of the applicable compensation that would have been paid to Seller
if Purchaser were to have processed and sold all Qualifying Landfill Gas
made available by Seller using the same procedures as are contained in
Article 4.5 above; or
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(d)
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The
Commercial Operations Date, or any extension thereof authorized
by this Agreement or otherwise agreed to by the Parties, does not occur as
set forth in Article 4.5 hereof through no fault of Seller;
or
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(e)
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If
Purchaser should file a petition for an order of relief under the United
States Bankruptcy Code (11 U.S.C.), make a general assignment for the
benefit of its creditors, or if a receiver should be appointed on account
of insolvency. Purchaser shall notify Seller of any voluntary
Bankruptcy filings within 10 days of
filing;
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(f)
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If,
following the eighteen (18) month anniversary of the Commercial Operations
Date, and within any Contract Year, Purchaser shall fail to process and
sell or otherwise pay Seller for at least fifty percent (50%) of the
Qualifying Landfill Gas made available by Seller over a rolling one hundred eighty
(180)-day period, other than as the result of an event of Force Majeure,
Seller’s failure to deliver such Qualifying Landfill Gas to Purchaser, or
Seller’s breach of any term or condition of this Agreement;
or
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17
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(g)
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Any
change in applicable law or other event adversely affects Seller’s
Facilities, Seller’s Site, or Seller’s ability to fulfill its obligations
under this Agreement such that to continue to perform hereunder would be
unlawful or commercially unreasonable;
or
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(h)
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Purchaser
shall abandon Purchaser’s Site for a period of one hundred eighty (180)
days or shall abandon its duties or obligations hereunder for a period of
one hundred eighty (180) days, after the notice and right to cure
provisions in Article 6.2(a) have been
satisfied.
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6.3
|
Purchaser’s Right to
Terminate. Purchaser may terminate this Agreement by
written notice to Seller upon the occurrence of any of the following
events:
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(a)
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Seller
fails to perform any material obligation hereunder, and fails to cure such
failure to perform within thirty (30) days after receipt of Purchaser’s
notice of such failure of performance, or if such cure cannot be completed
in thirty (30) days, Seller fails to promptly initiate, diligently pursue,
and implement such cure in a prompt fashion, taking into consideration the
nature of the circumstances; provided that in no event shall the cure
period be extended longer than a total of one hundred eighty (180) days;
or
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(b)
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Seller
has breached any material representation, warranty, covenant or agreement
contained in this Agreement; or
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(c)
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Through
no fault, negligence or lack of diligence of Purchaser, the termination or
expiration of any necessary right of way or easement related to the
Purchaser’s Facilities, Purchaser’s Site, or Purchaser’s business
operations as to this Agreement which right of way or easement is not
under the control of Seller; or
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(d)
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Purchaser’s
Facilities and/or Purchaser’s business is no longer economically viable
through no fault of Purchaser, provided that Purchaser must provide a
financial demonstration to the Seller of (i) actual cumulative loss over
six (6) consecutive
operating months, and (ii) a reasonable forecast of continued financial
losses over the next twelve (12) month period;
or
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(e)
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If,
following the Commercial Operations Date, to the extent Landfill Gas is
otherwise available, Seller fails to make available to Purchaser
substantially all of the Landfill Gas, other than as the result of (i) an
event of Force Majeure or (ii) the reduction in the maximum amount of
Landfill Gas Seller is required to make available to Purchaser pursuant to
the provisions of Article 4.2; or.
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18
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(f)
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Any
change in applicable law or other event materially and adversely affects
the Purchaser’s Facilities, Purchaser’s Site, Purchaser’s business
operations or Purchaser’s ability to fulfill its obligations under this
Agreement; or
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(g)
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Seller
fails to perform its obligations under this Agreement due to an event of
Force Majeure that lasts longer than one hundred eighty (180) days,
provided that Purchaser is willing and able during such time to accept
Landfill Gas from Seller hereunder;
or
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(h)
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If
Seller should file a petition for an order of relief under the United
States Bankruptcy Code (11 U.S.C.), make a general assignment for the
benefit of its creditors, or if a receiver should be appointed on account
of insolvency. Seller shall notify Purchaser of any voluntary
Bankruptcy filings within 10 days of
filing.
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6.4
|
Effect of
Termination. Upon termination authorized by Articles
6.2(c), 6.2(d), 6.2(f), 6.2(g), 6.3(c), 6.3(d), 6.3(f) or 6.3(g) of this
Agreement, neither Party shall have any further obligation to
the other, including, without limitation, liability for payment of
compensatory or consequential damages resulting from such termination,
except that: (i) Purchaser shall remain obligated to pay Seller as
provided herein for Gross Revenue derived from all Landfill Gas delivered
hereunder prior to the time of termination, and (ii) Seller shall remain
obligated to pay Purchaser the amounts provided for in Articles 4.6 and
4.7, if any, in accordance with the terms thereof. Except as
limited by the provisions of Article 10.4, upon termination authorized by
any other provision of this Article 6, the Parties may pursue all remedies
available to each at law or in equity, by statute or
otherwise. Notwithstanding anything else herein to the
contrary, the indemnification obligations of Article 10 shall remain in
effect notwithstanding the termination of this
Agreement. Should either Party terminate this Agreement as
authorized by this Agreement, Purchaser shall be obligated to remove
Purchaser’s Facilities from Seller’s Site within a reasonable time not to
exceed two hundred seventy (270) days after such
termination.
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ARTICLE
7
GAS
QUALITY
7.1
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Landfill Gas
Quality. To the extent that any Landfill Gas made
available to Purchaser does not meet the following minimum standards,
Purchaser, as its sole remedy, shall have no obligation to purchase and/or
accept any Landfill Gas that does not meet such standards: four hundred
and fifty (450) BTU per cubic foot (when the gas is saturated with water
vapor, at a base temperature of sixty (60) degrees Fahrenheit and at a
base pressure of 14.73 pounds per square inch absolute (PSIA)) and not
contain in excess of 10% Nitrogen or 2%
Oxygen.
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7.2
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Quality Initiatives
and Capabilities. Subject to Article 2.7 specifying the
priority of Seller’s operations, Seller shall cooperate with Purchaser to
develop appropriate quality initiatives and capabilities at Seller’s Site
with the objective of making available to Purchaser the maximum quantity
of Qualifying Landfill Gas. In addition to the other rights
granted Purchaser in this Agreement, Purchaser shall have the right to
make recommendations with regards to such qualitative initiatives and
capabilities; provided, however, that Purchaser may request that any
information that is disclosed be held confidential pursuant to Article
13.12 of this Agreement. Purchaser shall have the right to make
reasonable requests for meetings to review Seller’s progress regarding to
this Article 7.2.
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19
7.3
|
Limited
Warranty. EXCEPT AS EXPRESSLY PROVIDED IN THIS
AGREEMENT, SELLER MAKES NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
FITNESS FOR A PARTICULAR PURPOSE, RELATED TO THE QUALITY OF THE LANDFILL
GAS. IN NO WAY LIMITING THE FOREGOING, AND NOTWITHSTANDING
ANYTHING HEREIN TO THE CONTRARY, SELLER DOES NOT WARRANT THE RATES OF
PRODUCTION, QUANTITY OR QUALITY OF LANDFILL GAS RESULTING FROM THE
BIOLOGICAL DECOMPOSITION OF SOLID WASTES IN SELLER’S SITE, AND PURCHASER
ACKNOWLEDGES THAT IT IS RELYING SOLELY ON ITS OWN EVALUATION OF SELLER’S
SITE. SELLER MAKES NO REPRESENTATION OR WARRANTY AS TO THE
ACCURACY OR COMPLETENESS OF ANY INFORMATION THAT MAY HAVE BEEN PROVIDED TO
PURCHASER AS PART OF ITS DUE DILIGENCE REVIEW. MOREOVER,
PURCHASER RECOGNIZES THAT LANDFILL GAS MAY CONTAIN CORROSIVE OR
DELETERIOUS SUBSTANCES. SELLER SHALL HAVE NO OBLIGATION TO PAY
COSTS FOR REPAIR OR REPLACEMENT OF THE PURCHASER’S FACILITIES OR ANY
COMPONENT PARTS THEREOF OWNED BY PURCHASER, ITS AFFILIATES OR ANY OTHER
PERSON, CAUSED BY SUCH SUBSTANCES.
|
7.4
|
Disposal of
Condensate. Seller shall be responsible for the disposal
of condensate materials, leachate, and liquids produced on Seller’s
Site. Purchaser shall be responsible for the disposal of
condensate materials, leachate, and liquids produced from its processing
facilities or otherwise after the Delivery Point. The removal,
management, characterization, and disposal of free liquids, leachate
and/or condensate contained in Landfill Gas after the Delivery Point shall
be at the sole cost and expense of Purchaser. Seller shall
accept into its wastewater management system all condensate from the
processing equipment on Purchaser’s Site that does not violate the
acceptance criteria of the commercial wastewater treatment plant that
Seller uses for treatment and disposal of its own
wastewater. Either party may collect samples of condensate from
Purchaser’s Facilities as needed. The party wishing to collect
samples shall provide at least five (5)-days advance notice of its
intention to collect samples so that the other party may witness the
sample collection. Purchaser shall be responsible for and pay
Seller, at Seller’s cost, on a per gallon basis, the wastewater treatment
costs incurred by Seller in proportion to the volume of condensate offered
by Purchaser to Seller for inclusion in Seller’s wastewater management
system. To the extent reasonably practicable, and subject to
the other limitations and restrictions set forth herein, Seller and
Purchaser agree to work together to utilize liquids collected from
Seller’s Site in a mutually beneficial manner, including, without
limitation, seeking authorization to reintroduce such liquids into
Seller’s Site, if such reintroduction would likely increase the generation
of Qualifying Landfill Gas and can technically, feasibly and reasonably be
incorporated into the design and operation of Seller’s
Site.
|
20
7.5
|
Disposal of Landfill
Gas Not Used by Purchaser. Unless otherwise permitted
hereunder or required by any applicable law, no Landfill Gas purchased or
accepted by Purchaser hereunder, or any component or characteristic of
such Landfill Gas, shall be returned to Seller or Seller’s Site without
prior written consent of Seller. Seller shall, at its sole cost
and expense, dispose of any Landfill Gas not required to be purchased
and/or accepted by Purchaser under this Agreement in full compliance with
all applicable laws, regulations and permit conditions, including without
limitation Environmental Laws. All Landfill Gas purchased or
accepted by Purchaser hereunder, or any component or characteristic of
such Landfill Gas, that is not processed or otherwise sold by Purchaser
shall be disposed of by Purchaser, at its sole cost and expense, in full
compliance with all applicable laws, regulations and permit conditions,
including without limitation Environmental Laws. In addition to
the foregoing, Seller hereby agrees to accept redelivery of Landfill Gas
from Purchaser under the condition that Purchaser is required to purge its
Purchaser’s Facilities of Landfill Gas due to: 1) start-up operations, 2)
to perform maintenance, and/or 3) to recycle Landfill Gas that is not
Qualifying Landfill Gas.
|
ARTICLE
8
MEASUREMENT
8.1
|
Metering
Equipment. Purchaser shall, at no cost to Seller,
install, operate and maintain in accurate working order, metering devices,
mutually acceptable to the Parties for the measurement of flow and quality
(including Btu per cubic foot) at the Delivery
Point. The metering devices at the Delivery Point shall measure
the flow and quality of Landfill Gas delivered to
Purchaser. Seller shall have access to the metering and
measurement equipment at reasonable times upon prior notice, and Purchaser
may have its representative
present.
|
8.2
|
Meter
Tests. Purchaser shall, at its expense, keep the
measurement and metering equipment specified in Article 8.1 accurate and
in good repair and calibration, making such periodic tests, as Purchaser
deems necessary, but at least twice each year. Purchaser shall
give Seller reasonable advance notice of any such test so Seller may have
its representative(s) present. Seller may request additional
special tests and calibration of the metering and measurement equipment
two (2) times each year. The expense of such special tests
shall be borne by Seller if the equipment is found to be inaccurate by
less than three percent (3%). If, upon any test, the equipment
is found to be inaccurate by three percent (3%) or more, the cost of
special test shall be borne by Purchaser and meter readings and invoices
shall be corrected for a period extending back to the immediately
preceding test or special test and
calibration.
|
21
(a)
|
Meter Out of
Service. If, for any reason, the metering or measurement
equipment at the Delivery Point is out of service such that the amount of
Landfill Gas delivered and the BTU value cannot be ascertained, Purchaser
will notify Seller within twenty four (24) hours. During the
period when the metering or measurement equipment is out of service, the
Parties shall utilize the metering and measurement records from similar
periods within the immediately preceding thirty (30)
days.
|
ARTICLE
9
PRICE, BILLING AND
PAYMENT
9.1
|
Project Development
Payment. To induce Seller to enter into this Agreement,
no later than the earlier of December 31, 2008, or thirty days after
execution of this Agreement (or the first business day thereafter, if the
thirtieth day falls on a Saturday, Sunday, or a legal holiday) (the
“Payment Date”), Purchaser shall pay to Seller a nonrefundable payment
(except as provided in Article 2.8) in the amount of two million seven
hundred fifty thousand dollars ($2,750,000) (the “Project Development
Payment”) in immediately available funds. If for any reason the
Project Development Payment has not been wired to Seller’s account with
confirmation no later than noon MST on the Payment Date, Seller, at its
option, may terminate this Agreement without liability or obligation to
Purchaser (other than the return of the Project Development Payment if it
is later received).
|
9.2
|
Compensation. During
the term of this Agreement, Purchaser shall pay Seller for Landfill Gas
received at the Delivery Point a royalty of *****. In
addition to the foregoing compensation, certain Environmental Attributes
will be shared in the manner described in Article 9.5, and Purchaser shall
be responsible for payments to Seller for the well field technician as
described in Article 4.3(b).
|
9.3
|
Calculation of Amounts
Due. On or before the fifteenth (15th)
day after each Accounting Period, Purchaser shall invoice its Gas Buyer(s)
for Landfill Gas delivered and sold during such Accounting
Period. Within thirty (30) days receipt of payment from Gas
Buyer(s), Purchaser shall remit to Seller a statement disclosing all
information necessary to determine the amount due to
Seller. Each such statement shall be accompanied by a payment
by Purchaser of any undisputed amounts due to Seller with respect to such
Accounting Period. Purchaser agrees to exercise commercially
reasonable efforts to collect all amounts due from Gas Buyer(s) in a
timely manner.
|
9.4
|
Payment
Terms. Purchaser shall pay to Seller, at the address for
payments set forth below, in immediately available funds the amount due
Seller. Purchaser shall pay Seller in the manner and at the
time set forth in this Article 9. To the extent any undisputed
payment is not made on or before the payment due date, or if any payment
is determined to be due as the result of an audit described in Article
9.6, such late payment shall accrue interest at the rate of prime rate as
published in the Wall Street Journal from time to time plus two percent
(2%) from the date that such payment was
due.
|
*****
Certain information on this page has been omitted from this filing and filed
separately with the Securities and Exchange Commission. Confidential
treatment has been requested with respect to the omitted
information.
22
Attn:
General Manager
|
||
Allied
Waste Systems
|
||
000
Xxxxxx Xxxx Xxxx
|
||
Xxxxxxxx,
Xxxxxxx 00000
|
||
and
copy to:
|
Attn: Senior
Director of Renewable Energy Development
|
|
Allied
Waste Industries
|
||
00000
Xxxxx Xxxxxx Xxx
|
||
Xxxxxxx,
Xxxxxxx
00000
|
9.5
|
Sharing of Certain
Environmental Attributes; Reimbursement of Certain Other
Payments. Except as otherwise provided in Articles 3.1
and 3.3 or elsewhere herein, Purchaser and Seller will share equally any
Environmental Attributes secured in association with (i) the sale or
processing of Landfill Gas to Purchaser, and (ii) Purchaser’s operations
at or relating to Purchaser’s Site or the Purchaser’s
Facilities. In addition, if Seller, in Seller’s sole
discretion, pays any amount required to be paid by Purchaser directly
pursuant to this Agreement, Purchaser shall reimburse Seller for such
payment within ten (10) days after Seller notifies Purchaser and provides
proof of such payment. Seller agrees to give Purchaser advance
notice of its intent to make any such payments. If Purchaser
does not reimburse Seller for such payments during the ten (10) day
period, interest shall begin to accrue on the unpaid amounts at an annual
rate equal to two percent (2%) plus the prime rate of interest as
published in the Wall Street Journal from time to
time.
|
9.6
|
Liability for
Taxes. Seller shall pay or cause to be paid all taxes
and assessments imposed on Seller with respect to the sale of Landfill Gas
and the ownership and operation of Seller’s
Facilities. Purchaser shall pay or cause to be paid all taxes
and assessments imposed upon Purchaser with respect to the purchase,
processing, transmission and/or sale of Landfill Gas and the ownership and
operation of the Purchaser’s Facilities. In addition, Purchaser
shall reimburse Seller in the event the value of the Purchaser’s
Facilities or any other equipment of Purchaser, or any part thereof, is
assessed against any property of Seller. Except as provided in
the preceding sentence, neither Party shall be responsible or liable for
any taxes nor any other statutory charges levied or assessed against any
of the facilities of the other Party used for the purpose of carrying out
the provisions of this Agreement. Each Party shall be
responsible for securing its own sales tax exemptions, if
applicable.
|
23
9.7
|
Records. Purchaser
shall maintain books, records, documents, accounts and other evidence of
(i) Landfill Gas flow and quality, and (ii) amounts due to Seller under
this Agreement in accordance with generally accepted accounting principles
and practices consistently applied. Seller or its designee,
during Purchaser’s normal business hours and upon five (5) days prior
written notice, shall have access to Purchaser’s books, records,
documents, accounts and other evidences, including, without limitation,
applicable Gas Purchase Contracts, pertaining to amounts due to Seller
hereunder, and Landfill Gas flow and quality, for the purpose of
inspection, auditing and copying. With regard to the foregoing
inspection, auditing, and copying rights, Purchaser agrees to exercise any
similar rights that it may have under any Gas Purchase Contract on behalf
or for the benefit of Seller upon Seller’s reasonable
request. Purchaser shall preserve and shall make such books,
records, documents, accounts and other evidences available to Seller or
its designee at no charge for a minimum period of five (5) years
following the month of the relevant delivery of Landfill Gas under this
Agreement. Purchaser shall have the right, during Seller’s
normal business hours, to inspect, audit and copy Seller’s books, records
documents and accounts and other evidence pertaining directly to this
Agreement. The review by either Party of the books and records
of the other Party shall be subject to the confidentiality obligations set
forth in Article 13.12.
|
9.8
|
Electricity. Purchaser
shall pay for or reimburse Seller for electricity used by Seller’s blowers
to deliver Landfill Gas to the Delivery Point, but not for the electricity
used to deliver non-Qualifying Landfill Gas to Seller’s
Flare. The Parties shall mutually agree on an equitable method
to allocate electricity usage between Seller’s blower and Seller’s Flare
(i.e.,
separate meters).
|
ARTICLE
10
INDEMNITY
10.1
|
Seller’s
Indemnity. Seller agrees to defend, indemnify and hold
harmless Purchaser (including its officers, directors, members, employees,
agents, representatives, contractors and subcontractors) from and against
any and all liabilities (including third party liabilities), claims,
injuries (including death resulting therefrom), property damage, fine,
penalty or assessment by any public agency (insofar as not prohibited by
law), cost or expense (including cost of defense, settlement and
reasonable attorney’s fees), which (i) are directly or indirectly caused
by any wrongful act or omission of Seller and/or its officers, directors,
employees, agents, representatives, contractors or subcontractors
associated with, or arising from Seller’s performance or nonperformance of
its obligations under this Agreement or any other agreement between the
parties, (ii) any wrongful act or omission of Seller, its officers,
directors, employees, agents, representatives, contractors or
subcontractors associated with, or arising from the ownership or operation
of Seller’s Facilities and Seller’s Site, (iii) any breach of any
applicable governmental laws, regulations or ordinances, and (iv) any and
all Environmental Claims (as hereinafter defined) brought against
Purchaser located at or otherwise relating to Seller’s Site or Seller’s
business, or Purchaser’s Site or Purchaser’s business, to the extent
arising out of circumstances that (a) exist at the Effective Date, or (b)
which come into existence thereafter otherwise than as a result of the
matters described in Article 10.2 below, or (c) are caused by or result
from a breach of this Agreement by Seller or the negligence or willful
misconduct of Seller. As used herein “Environmental Claims”
means all claims, demands, suits, causes of action or injuries to persons
or property damage arising out of a violation of Environmental
Laws.
|
24
10.2
|
Purchaser’s
Indemnity. Purchaser agrees to defend, indemnify and
hold harmless Seller (including its officers, directors, members,
employees, agents, representatives, contractors, subcontractors,
successors and assigns), from and against any and all liabilities
(including third party liabilities), claims, injuries (including death
resulting therefrom), property damage, fine, penalty or assessment by any
public agency (insofar as not prohibited by law), cost or expense
(including costs of defense, settlement and reasonable attorneys’ fees),
which (i) are directly or indirectly caused solely by any wrongful act or
omission of Purchaser and/or its officers, directors, employees, agents,
representatives, contractors or subcontractors associated with, or arising
from Purchaser’s performance or nonperformance of its obligations under
this Agreement or any other agreement between the parties, (ii) any
wrongful act or omission of Purchaser, its officers, directors, employees,
agents, representatives, contractors or subcontractors associated with, or
arising from Purchaser’s business operations, (iii) any breach of any
applicable governmental laws, regulations or ordinances, and (iv) any and
all Environmental Claims brought against Seller located at or otherwise
relating to Seller’s Site or Seller’s business, or Purchaser’s Site or
Purchaser’s business, to the extent arising out of the operation of
Purchaser’s Facilities or which otherwise come into existence as (or
arises out of) circumstances caused by a result of a breach of this
Agreement by Purchaser or the negligence or willful misconduct of
Purchaser.
|
10.3
|
Comparative
Fault. The Parties agree that principles of comparative
fault shall govern this indemnity
obligation.
|
10.4
|
Limitation of
Damages. Notwithstanding anything herein to the
contrary, neither Party shall have any liability to the other for
incidental, indirect, punitive, or consequential
damages.
|
ARTICLE
11
WARRANTIES AND
REPRESENTATIONS
11.1
|
Purchaser. Purchaser
represents and warrants to Seller as
follows:
|
|
(a)
|
Purchaser
is a limited liability company duly organized and validly existing under
the laws of the State of Georgia, with full legal right, power and
authority to enter into and to fully and timely perform its obligations
hereunder.
|
|
(b)
|
Purchaser
has duly authorized, executed and delivered this Agreement, and this
Agreement constitutes a legal, valid and binding obligation, enforceable
against Purchaser in accordance with its
terms.
|
|
(c)
|
Other
than as previously disclosed in writing by Purchaser to Seller, Purchaser
has no knowledge of any action, suit or proceeding, at law or in equity,
before or by any court or Governmental Authority, pending or threatened
against Purchaser, in which an unfavorable decision, ruling or finding
would materially adversely affect the performance by Purchaser of its
obligations hereunder or the other transactions contemplated hereby, or
that, in any way, would materially adversely affect the validity or
enforceability of this
Agreement.
|
25
|
(d)
|
Neither
the execution or delivery by Purchaser of this Agreement, nor the
performance by it of its obligations in connection with the transactions
contemplated hereby or the fulfillment of the terms and conditions hereof
conflicts with, violates or results in a breach of any constitution, law
or governmental regulation applicable to it, or materially conflicts with,
violates or results in a breach of any term or condition of any order,
judgment, or decree or any agreement of instrument to which Purchaser is a
party or by which Purchaser or any of its properties or assets are bound,
or constitutes a default
thereunder.
|
|
(e)
|
No
approval, authorization, order, consent, declaration, registration or
filing with any federal, state or local governmental authority or
referendum of voters is required for the valid execution and delivery of
this Agreement by Purchaser, except such as have been disclosed to Seller
and have been duly obtained or
made.
|
11.2
|
Seller. Seller
represents and warrants to Purchaser as
follows:
|
|
(a)
|
Seller
is limited liability company duly organized and validly existing under the
laws of the State of Delaware, with full legal right, power and authority
to enter into and to fully and timely perform its obligations
hereunder.
|
|
(b)
|
Seller
has duly authorized, executed and delivered this Agreement, and this
Agreement constitutes a legal, valid and binding obligation of Seller,
enforceable against Seller in accordance with its
terms.
|
|
(c)
|
Other
than as previously disclosed in writing by Seller to Purchaser, Seller has
no knowledge of any action, suit or proceeding, at law or in equity,
before or by any court or Governmental Authority, pending or threatened
against Seller, in which an unfavorable decision, ruling or finding would
materially adversely affect the performance by Seller of its obligations
hereunder or the other transactions contemplated hereby, or that, in any
way, would materially adversely affect the validity or enforceability of
this Agreement.
|
|
(d)
|
No
approval, authorization, order, consent, declaration, registration or
filing with any federal, state or local governmental authority or
referendum of voters is required for the valid execution and delivery of
this Agreement by Seller, except such as have been disclosed to Purchaser
and have been duly obtained or
made.
|
26
|
(e)
|
Neither
the execution or delivery by Seller of this Agreement, nor the performance
by it of its obligations in connection with the transactions contemplated
hereby or the fulfillment of the terms and conditions hereof conflicts
with, violates or results in a breach of any constitution, law or
governmental regulation applicable to it, or materially conflicts with,
violates or results in a breach of any term or condition of any order,
judgment, or decree or any agreement of instrument to which Seller is a
party or by which Seller or any of its properties or assets are bound, or
constitutes a default
thereunder.
|
|
(f)
|
No
approval, authorization, order, consent, declaration, registration,
agreement or filing with DeKalb County, a political subdivision of the
State of Georgia, is required for the valid execution and delivery of this
Agreement by Seller.
|
|
(g)
|
Seller
has good and marketable title to the Landfill Gas, free and clear of all
security interests, liens, claims or encumbrances of any nature or kind
whatsoever in favor of any third party, including, but not limited to any
Governmental Authority.
|
ARTICLE
12
INSURANCE
12.1
|
Purchaser’s Insurance
Requirements. During the term of this Agreement,
Purchaser shall maintain the following minimum insurance coverages, either
by one or more policies, including in combination with an excess liability
policy:
|
Workers’
Compensation:
|
|
Coverage
A
|
Statutory
|
Coverage
B – Employer’s Liability
|
$2,000,000
each accident/$2,000,000
aggregate
|
$2,000,000
each employee by disease
|
|
$2,000,000
policy limit by disease
|
|
Automobile
Liability:
|
|
Bodily
Injury/Property Damage
|
$3,000,000
per accident/$3,000,000 aggregate
|
Combined
– Single Limit
|
Coverage
is to apply to all owned, non-owned, hired and leased vehicles (including
trailers)
|
Commercial
General Liability:
|
|
Bodily
Injury/Property Damage
|
$5,000,000 each
occurrence
|
Combined
– Single Limit
|
$10,000,000
general and complete operations aggregate
|
Pollution
Legal Liability
|
|
Limits
|
$1,000,000
per incident/$1,000,000
aggregate
|
12.2
|
Seller’s Insurance
Requirements. During the term of this Agreement, Seller
shall maintain the following minimum insurance coverages, either by one or
more policies, including in combination with an excess liability
policy:
|
27
Workers’
Compensation:
|
|
Coverage
A
|
Statutory
|
Coverage
B – Employer’s Liability
|
$2,000,000
each accident/$2,000,000
aggregate
|
$2,000,000
each employee by disease
|
|
$2,000,000
policy limit by disease
|
|
Automobile
Liability:
|
|
Bodily
Injury/Property Damage
|
$3,000,000
per accident
|
Combined
– Single Limit
|
Coverage
is to apply to all owned, non-owned, hired and leased vehicles (including
trailers)
|
Commercial
General Liability:
|
|
Bodily
Injury/Property Damage
|
$5,000,000 each
occurrence
|
Combined
– Single Limit
|
$10,000,000
general and complete operations aggregates
|
Pollution
Legal Liability
|
|
Limits
|
$1,000,000
per
incident
|
12.3
|
General
Provisions. All deductibles in the above-described
insurance policies shall be at the respective Party’s sole
risk. Each Party agrees to provide the other Party with
immediate notification of the receipt of any notice of cancellation or
intended cancellation of any of its required insurance. The
insurance carriers providing the coverage required by this Article shall
be rated at least A- VIII by A.M.
Best. All such insurance shall be written as primary,
noncontributing (except for claims arising out of sole
negligence). With the exception of the workers’ compensation
policy, each Party’s insurance coverage, as required herein, will show the
other Party as an additional insured as its interests may appear, and
shall include a waiver of subrogation provision in favor of the other
Party.
|
To the
extent that a party employs, utilizes or contracts with subcontractors and/or
independent contractors to perform services relating to this Agreement, the
party shall require such subcontractors and/or independent contractors to comply
with the same insurance requirements as set forth in this Article.
On the
sixth (6th)
anniversary of the Commercial Operations Date and every five (5) years
thereafter during the Term, the Parties shall review the foregoing insurance
coverage requirements and, to the extent commercially available to them, shall
increase same to bear the same relation to landfill gas-to-energy industry
standards applicable to similarly sized plants in similar locations as they bear
on the date of this Agreement. The foregoing shall not limit the
obligation of Purchaser to maintain the initial types and amounts of insurance
required hereunder.
28
Notwithstanding
the foregoing, the existence of the above insurance or coverages shall not limit
the liability of the Parties under this Agreement.
12.4
|
Certificates of
Insurance. Each Party hereto shall provide to the other
Party certificates of insurance each year during the term of this
Agreement to evidence that the required insurance coverage is in effect at
all times during the term hereof.
|
ARTICLE
13
MISCELLANEOUS
13.1
|
Assignment. This
Agreement may not be assigned by either party without the prior written
approval of the other party, which consent shall not be unreasonably
withheld, conditioned or delayed; provided that (i) Seller may assign all
of its rights, duties and obligations hereunder to a third party purchaser
of Seller’s Site, Seller or substantially all of the assets of Seller
without the written consent of Purchaser (provided that in any event such
purchaser agrees in a writing in form and substance reasonably
satisfactory to Purchaser to assume all of Seller’s duties and obligations
hereunder), and (ii) upon thirty (30) days written notice to Seller,
Purchaser may, without the written consent of Seller, assign all of its
rights, duties and obligations hereunder to (a) an Affiliate of Purchaser,
subject to the continuing obligation of Purchaser hereunder; or (b) on or
following the Commercial Operations Date, a third-party purchaser of
Purchaser or of substantially all of the assets of Purchaser, which shall
include, without limitation, Purchaser’s facilities and operations at Live
Oak if such facilities and operations are then owned by Purchaser
(provided that such purchaser agrees in a writing in form and substance
reasonably satisfactory to Seller to assume all of Purchaser’s duties and
obligations hereunder). Further, both Seller and Purchaser
shall each have the right to assign this Agreement without the written
consent of the other Party hereto as a collateral assignment to any lender
to Seller or Purchaser, as applicable, or any of its Affiliates; provided
that the form of collateral assignment shall be subject to the prior
review and approval of the non-assigning party, such approval not to be
unreasonably withheld, conditioned, or delayed. Notwithstanding
anything herein to the contrary, and in no way limiting the foregoing,
Purchaser acknowledges and agrees that Seller's refusal to consent to a
proposed assignment shall not be deemed unreasonable if, among other
things, (i) Purchaser has not purchased Landfill Gas from
Seller in accordance with this Agreement for a period of twelve (12)
consecutive months after the Commercial Operations Date, (ii) Seller (or
any of its Affiliates) has a significant or material history of litigation
or disputes involving the proposed assignee or any of its Affiliates, or
(iii) the assignee is unwilling to assume all of Purchaser’s duties and
obligations hereunder in a writing addressed to Seller. All
covenants, terms, conditions, and provisions of this Agreement shall be
binding upon the Parties hereto and shall extend to and be binding upon
the successors and permitted assigns of the Parties
hereto.
|
13.2
|
Notices. All
notices, requests, demands, statements and or payment provided for herein
shall be in writing and sent to the Parties hereto at the following
addresses:
|
29
Seller:
|
Attn:
General Manager
|
Allied
Waste Systems
|
|
000
Xxxxxx Xxxx Xxxx
|
|
Xxxxxxxx,
Xxxxxxx 00000
|
|
With
copy to:
|
Attn: Senior
Director of Renewable Energy Development
|
c/o
Allied Waste Industries, Inc.
|
|
00000
Xxxxx Xxxxxx Xxx
|
|
Xxxxxxx,
Xxxxxxx 00000
|
|
and
copy to:
|
Attn: Xxxxx
Xxxxxxx
|
c/o
Xxxxxxxxx Xxxxx
|
|
0000
Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
|
|
Xxxxxxx,
Xxxxxxx 00000
|
|
Purchaser:
|
Attn: Xxxx
Xxxxx
|
President
|
|
GES
Live Oak – Xxxxxxx Xxxxx, XXX
|
|
Xxxxx
000, Xxxxx Xxxxx 200
|
|
0000
Xxxxxxxxx Xxxx, XX
|
|
Xxxxxxx,
Xxxxxxx 00000
|
Such
notices, etc. shall be deemed to have been given and received when personally
delivered or upon receipt as evidence by a U.S. Postal Service Receipt for
Certified or Registered Mail. Either Party may change the address to
which communications or payments are to be made by written notice to the other
Party as set forth above.
13.3
|
Publicity and
Corporate Identity. The Parties shall not use the name,
trade name, trademarks, service marks owned by the other Party, or logos
of the other Party in any publicity releases, news releases, annual
reports, product packaging, signage, stationary, print literature,
advertising, or websites without securing the prior written approval of
the other Party. The Parties shall not, without prior written
consent of the other Party, represent, directly or indirectly, that any
product or service offered by the Party has been approved or endorsed by
the other Party.
|
13.4
|
Entire
Agreement. This Agreement is intended by the Parties as
the expression of their agreement with respect to such subject matter,
both written and oral, and supersedes all previous
agreements. This Agreement may be modified only by a written
amendment executed by both Parties.
|
13.5
|
Fees. Except
as otherwise provided herein, the Parties shall pay their own expenses
including attorney’s fees, incident to the preparation and performance of
this Agreement, whether or not the transactions contemplated herein are
consummated.
|
30
13.6
|
Governing Law; Venue;
Jurisdiction; Attorneys’ Fees. This Agreement shall be
governed by and construed in accordance with the internal laws of the
State of Georgia, without giving effect to any choice or conflict of law
provision or rule (whether of the State of Georgia or any other
jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of Georgia. Notwithstanding
the foregoing, any legal action arising under or in connection with this
Agreement or any other instrument, document or agreement executed or
delivered in connection with this Agreement, or in any way connected with
or related or incidental to the dealings of the Parties with respect to
this Agreement or such other instrument, document or agreement or the
transactions contemplated herein (“Dispute”) shall be brought exclusively
in the state or federal courts located in Xxxxxx County,
Georgia. By execution and delivery of this Agreement, with
respect to Disputes each of the Parties knowingly, voluntarily and
irrevocably: (a) consents, for itself and in respect of its
property, to the exclusive jurisdiction of these courts; (b) waives any
immunity or objection, including any objection to personal jurisdiction or
the laying of venue or based on the grounds of forum non conveniens, which
it may have from or to the bringing of the Dispute in such jurisdiction;
(c) waives any personal service of any summons, complaint or other process
that may be made by any other means permitted by the State of Georgia; (d)
waives any right to trial by jury; (e) agrees that any such Dispute shall
be decided by court trial without a jury; and (f) agrees that any Party to
this Agreement may file an original counterpart or a copy of this Article
with any court as written evidence of the consents, waivers and agreements
of the Parties set forth in this Article. Should any litigation
be commenced under this Agreement, the successful Party in such litigation
shall be entitled to recover, in addition to such other relief as the
court may award, its reasonable attorneys’ fees, expert witness fees,
litigation related expenses, and court or other costs incurred in such
litigation or proceeding.
|
13.7
|
Force
Majeure. No liability shall result to either Party from
delay in performance or from nonperformance caused by acts of God,
strikes, lockouts or other industrial labor disturbances, acts of the
public enemy, wars, blockades, insurrections, riots, epidemics,
landslides, lightning, earthquakes, fires, storms, hurricanes, floods,
high-water washouts, civil disturbances, explosions, freezing of xxxxx or
lines of pipe, partial or entire failure of xxxxx or supply of Landfill
Gas caused directly or indirectly by any of the foregoing occurrences,
enactment of statutes, laws, or regulations, acts of governmental bodies
and any other cause or causes, whether of the kind herein enumerated or
otherwise, not reasonably within the control of the Party affected (each a
“Force Majeure”); provided that inability to make payments that does not
result from any of the foregoing shall not be considered an event of Force
Majeure. The affected Party shall promptly notify the other
Party, in writing, of the Force Majeure, its extent and probable duration
thereof, and shall be diligent in attempting to remove the cause(s)
thereof.
|
13.8
|
Contractor. It
is understood that the employees, subcontractors, methods, equipment, and
facilities of the Parties shall at all times be under their respective
exclusive direction and control. Purchaser’s relationship to
Seller shall be that of an independent contractor. Nothing in
this Agreement shall be construed to constitute Seller or Purchaser, or
any of its or their employees or subcontractors, as an agent, associate,
joint venturer or partner of the other
Party.
|
31
13.9
|
Headings;
Severability. The headings appearing in this Agreement
are intended for convenience and reference only, and are not to be
considered in construing this Agreement. Every provision of
this Agreement is intended to be severable. If any term or
provision hereof is illegal or invalid for any reason whatsoever, such
illegality or invalidity shall not affect the validity or legality of the
remainder of this Agreement.
|
13.10
|
No
Waiver. No delay or omission to exercise any right or
power shall be construed to be a waiver of any default or acquiescence
therein or a waiver of any right or power, and every such right and power
may be exercised from time to time and as often as may be deemed
expedient. Either Party’s acceptance of any performance due
hereunder that does not comply strictly with the terms hereof shall not be
deemed to be waiver of any right of such Party to strict performance by
the other Party. Acceptance of past due amounts or partial
payments shall not constitute a waiver of full and timely payment of any
sums due hereunder.
|
13.11
|
Interpretation. The
terms and provisions are not to be construed more liberally in favor of,
nor more strictly against, either Party. To the extent the
mutual covenants of the Parties under this Agreement create obligations
that extend beyond the termination or expiration of this Agreement, the
applicable provisions of this Agreement shall be deemed to survive such
termination or expiration for the limited purpose of enforcing such
covenants and obligations in accordance with the terms of this
Agreement.
|
13.12
|
Confidential
Information. Either Party may designate any data,
information, reports, or documents provided to the other as “Confidential
Information.” Except as required by law, neither Party shall,
without the prior written consent of the other Party, disclose any
Confidential Information obtained from the other Party to any third
Parties other than to any lender and prospective lender, consultants, or
to employees who have agreed to keep such information confidential as
contemplated by this Agreement and who need the information to assist
either Party with the rights and obligations contemplated
herein. Confidential Information shall not include information
that is: (i) or becomes generally known or available by publication,
commercial use or otherwise through no breach of this Agreement by the
receiving Party; (ii) known by the receiving Party before receipt of the
Confidential Information from the originating Party; (iii) independently
developed by the receiving Party or its directors, officers, employees,
agents, legal counsel or consultants without reference to the originating
Party’s Confidential Information; (iv) lawfully obtained from a third
party who has the right to make such disclosure; or (v) deliberately
released for publication by the originating Party in
writing.
|
13.13
|
Third Party
Beneficiaries. This Agreement is intended to be solely
for the benefit of the Parties hereto and their successors and permitted
assignees and is not intended to and shall not confer any rights or
benefits on any other third party not a signatory hereto, except as
explicitly provided with respect to any
lender.
|
32
13.14
|
Recitals and
Exhibits. All recitals set forth in, and exhibits
attached to, this Agreement are incorporated herein by this
reference.
|
[Signatures
are on the following page.]
33
IN WITNESS WHEREOF, the Parties
hereto have caused the execution of this Agreement by the officers whose names
appear below as of the date first written above:
Purchaser
|
Seller
|
|||
GES
Live Oak – Hickory Ridge, LLC,
|
BFI
Waste Systems of North America, LLC,
|
|||
a
Georgia limited liability company
|
a
Delaware limited liability company
|
|||
By:
|
/s/ Xxxxx X. Xxxx
|
By:
|
/s/ Xxxxxxxx Xxxxx
|
|
Print
Name: Xxxxx X. Xxxx
|
Print
Name: Xxxxxxxx Xxxxx
|
|||
Title: CEO
|
Title: Senior
Director, Renewable Energy
|
|||
Development
|
||||
Date:
November 14, 2008
|
Date:
November 14,
2008
|
Exhibit
A
FORM OF
SITE LEASE AGREEMENT
SITE
LEASE AGREEMENT
between
BFI WASTE SYSTEMS OF NORTH
AMERICA, LLC
and
GES
LIVE OAK – HICKORY RIDGE, LLC
Dated as
of
, 20
TABLE OF
CONTENTS
PAGE
|
||
SECTION
1.
|
PROPERTY
DESCRIPTION
|
1
|
SECTION
2.
|
TERM
|
1
|
SECTION
3.
|
WARRANTY
OF TITLE AND QUIET ENJOYMENT
|
1
|
SECTION
4.
|
RENT
|
1
|
SECTION
5.
|
USE,
IMPROVEMENTS AND EQUIPMENT
|
2
|
SECTION
6.
|
TAXES
AND ASSESSMENTS
|
5
|
SECTION
7.
|
DESTRUCTION
OF BUILDINGS
|
5
|
SECTION
8.
|
WASTE
PRODUCTS AND PERMITS
|
6
|
SECTION
9.
|
CONDEMNATION
|
6
|
SECTION
10.
|
DEFAULT
|
6
|
SECTION
11.
|
PROHIBITION
AGAINST LESSEE CREATING LIENS AGAINST PREMISES
|
7
|
SECTION
12.
|
INSURANCE
|
7
|
SECTION
13.
|
INDEMNITY
|
7
|
SECTION
14.
|
WAIVERS
|
7
|
SECTION
15.
|
NOTICES
|
8
|
SECTION
16.
|
WARRANTY
|
8
|
SECTION
17.
|
EASEMENTS
|
9
|
SECTION
18.
|
ENTIRE
AGREEMENT
|
9
|
SECTION
19.
|
GOVERNING
LAW; VENUE; JURISDICTION; ATTORNEY’S
FEES
|
10
|
SECTION
20.
|
ASSIGNMENT
|
10
|
SECTION
21.
|
BINDING
EFFECT
|
10
|
SECTION
22.
|
BROKERAGE
|
10
|
SECTION
23.
|
HEADINGS
AND TITLES
|
10
|
SECTION
24.
|
SEVERABILITY
|
11
|
SECTION
25.
|
NO
PARTNERSHIP
|
11
|
SECTION
26.
|
CONFLICTS
WITH PURCHASE AGREEMENT
|
11
|
ATTACHMENT A
|
PREMISES
DESCRIPTION
|
|
ATTACHMENT
B
|
DELIVERY
POINT
|
SITE
LEASE AGREEMENT
THIS SITE LEASE AGREEMENT
(this “Lease”) is
entered into this ____ day of ____________________, 20__, between BFI Waste
Systems of North America, LLC, a Delaware limited liability company, with
principal offices at 00000 Xxxxx Xxxxxx Xxx, Xxxxxxx, Xxxxxxx 00000
(“Lessor”),
and GES Live Oak – Hickory Ridge, LLC, a Georgia limited liability company, with
principal offices at Suite 000, Xxxxx Xxxxx 200, 0000 Xxxxxxxxx Xxxx, XX,
Xxxxxxx, Xxxxxxx 00000 (“Lessee”),
pursuant to the terms and conditions of a Landfill Gas Sale and Purchase
Agreement dated November 14, 2008 between Lessor and Lessee (the “Purchase
Agreement”), the terms of which are hereby incorporated
herein. Capitalized terms not otherwise defined herein shall have the
meaning given those terms in the Purchase Agreement.
TERMS AND
CONDITIONS
1. PROPERTY
DESCRIPTION. In consideration of the rents and covenants
herein stipulated to be paid and performed by Lessee, and Lessee’s execution of
the Purchase Agreement, Lessor does hereby grant, demise and lease unto Lessee,
the premises described in Attachment A attached
hereto and hereby incorporated herein (referred to herein as the “Premises
and referred to in the Purchase Agreement as “Purchaser’s
Site””), for the sole purpose of constructing, owning and
operating Purchaser’s Facilities (referred to herein as “Lessee’s
Facilities”). The Premises are located on and/or adjacent to
the Hickory Ridge Landfill, owned and operated by Lessor at 0000 Xxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxx 00000 (the “Landfill”). The
Premises are leased to Lessee in “as-is, where-is” condition,
and, subject to the terms and conditions of the Purchase Agreement, Lessor shall
have no obligation to make any improvements to the Premises before or during the
term of this Lease.
2. TERM. The
term of this Lease shall commence on the date first set forth above and, except
as may be set forth herein, shall continue in effect for so long as the Purchase
Agreement remains in effect, and this Lease shall terminate upon the expiration
or termination of the Purchase Agreement, as set forth therein, and shall be
renewed or extended to the same extent that the Purchase Agreement is renewed or
extended.
3. WARRANTY
OF TITLE AND QUIET ENJOYMENT. Lessor warrants that Lessor
[owns fee simple title to/leases] the Premises, and that Lessor has all right and
authority to make and perform this Lease. Lessor covenants that
Lessee, so long as Lessee observes and keeps the covenants of this Lease on its
part to be kept, and so long as the Purchase Agreement is in effect, shall
lawfully, peaceably and exclusively hold, occupy and enjoy the Premises during
the term hereof.
RENT. Lessor
acknowledges payment in advance of rent for the term of this Lease, including
any extensions thereof, in the sum of One Dollar ($1.00).
5.
|
USE, IMPROVEMENTS AND
EQUIPMENT.
|
(a) Lessor
and Lessee have entered into the Purchase Agreement, whereby Lessor has agreed
to sell and Lessee has agreed to purchase Qualifying Landfill
Gas. Pursuant to the Purchase Agreement and this Lease, Lessee shall,
at its sole cost construct, own and operate on the Premises Lessee’s
Facilities. The Premises may be used by Lessee solely for those
purposes consistent with the Purchase Agreement. Lessee shall have
the right to enter and occupy the Premises to fulfill its rights and obligations
under the Purchase Agreement and for all purposes necessary and convenient to
the construction, operation and use of Lessee’s Facilities. Lessee
has the right at its sole cost to construct, install, maintain and operate on
the Premises Lessee’s Facilities, subject to the provisions of Article 5(b), and
Lessor’s rights under the Purchase Agreement. In connection
therewith, and in accordance with the Purchase Agreement, Lessee has the right,
at its sole cost, to do all work necessary to prepare, maintain and alter the
Premises for Lessee’s business operations, and provide Lessor with ten (10)
business days advance notice of any construction including names of contractors
and subcontractors involved in such construction. Title to Lessee’s Facilities
shall be held by Lessee. Lessee shall remove all of Lessee’s
Facilities and restore the Premises to substantially its condition on the date
hereof at its sole expense in accordance with the terms and conditions of the
Purchase Agreement.
(b) In
no way limiting the foregoing, at least thirty (30) days prior to the
commencement of construction or installation of any Lessee’s Facilities, Lessee
shall provide Lessor with a Facilities Package (as defined
below). The delivery of the Facilities Package shall not obligate
Lessor to take any action or responsibility with respect to, nor shall such
delivery, or Lessor’s review or failure to review the Facilities Package,
relieve Lessee of any of its obligations regarding, the design, installation,
construction, operation or maintenance of Lessee’s
Facilities. Lessor, in its sole discretion, may, but shall not be
obligated to, comment on the Facilities Package, and require Lessee to make any
changes reasonably necessary to comply with the terms and conditions of this
Lease and any applicable law or to comply with reasonable requests of Lessor to
conform with standards of safety or aesthetics adopted by Lessor. If
Lessor has not commented on the Facilities Package within thirty (30) days after
receipt thereof, Lessor shall be deemed irrevocably to have no comments on the
Facilities Package. In no way limiting the foregoing, Lessee shall be
solely responsible to ensure that Lessee’s Facilities do not present any undue
risk of an explosion or other hazard at the Premises or surrounding property;
comply with all applicable laws relating to the Premises and Lessee’s Facilities
including, but not limited to, all Environmental Laws and applicable permits,
except where the failure to comply would not adversely affect Lessee’s
obligations under this Lease. For purposes of this Lease, the term
“Facilities Package” means a site plan for Lessee’s Facilities showing the plant
layout, the location and nature of perimeter fencing and landscaping around
Lessee’s Facilities, the location of the switch gear, the location of the gas
pipeline from the Delivery Point (as defined in the Purchase Agreement) to
Lessee’s Facilities, and the location of any interconnection works, and such
other information as may be reasonably requested by Lessor. The
Delivery Point is further described in Attachment B attached hereto and hereby
incorporated herein.
2
(c) At all
times during the term of this Lease, Lessee will keep and maintain, or cause to
be kept and maintained, Lessee’s Facilities and all such improvements, fittings
and fixtures as Lessee may erect on the Premises in reasonable repair and
condition having regard to their nature and permitted use, except for reasonable
wear and tear and damage by an event of Force Majeure or any action on the part
of the tenants or owners of any adjacent property. Upon the
expiration or earlier termination of this Lease, Lessor and Lessee agree that,
provided Lessee is not in default hereunder, Lessee shall have a period of two
hundred seventy (270) days, commencing on the date of expiration or termination,
to remove Lessee’s Facilities from the Premises. Upon expiration or
earlier termination of this Lease, Lessee shall use commercially reasonable
efforts to restore the Premises to substantially their condition on the date
hereof reasonable wear and tear excepted. Any part of Lessee’s
Facilities that has not been removed prior to the expiration of the aforesaid
two hundred seventy (270) day period shall, at Lessor’s option, be deemed to
have been abandoned, and title to such items shall, at Lessor’s option, vest in
Lessor at the end of such two hundred seventy (270) days, without any payment or
other consideration given by Lessor. Alternatively, Lessor may
require Lessee to remove all or any part of the remaining portion of Lessee’s
Facilities at Lessee’s expense and, if Lessee fails to remove such items at
Lessor’s request, Lessor may remove them at Lessee’s expense.
(d) Lessor
and Lessee intend and agree that, subject to the terms and conditions of this
Lease, Lessee’s Facilities shall be and remain the property of Lessee, and shall
at no time become a fixture with respect to the Premises. Title to
all of Lessee’s Facilities situated or erected on the Premises, as hereinabove
allowed, and any alteration, change or addition thereto, shall remain solely in
Lessee.
(e) Lessor
shall have the right, upon reasonable notice and during normal business hours,
to review and inspect Lessee’s operations on the Premises from time to time
during the term of this Lease. Such review and approval shall create
no warranties to Lessee and shall be limited to the extent necessary to satisfy
Lessor that, in Lessor’s reasonable business judgment, Lessee’s Facilities and
operations on the Premises:
(i)
comply
with the terms of this Lease and the Purchase Agreement;
(ii)
do
not affect or interfere with Seller, Seller’s Site or Seller’s Facilities in a
manner inconsistent with the provisions of Article 2.7 of the Purchase
Agreement;
(iii) do
not emit noxious odors or other emissions that violate any law or regulation,
and
(iv) do
not emit noise in violation of any law or regulation.
3
(f) Lessor
shall be responsible for providing Lessee, its contractors, invitees and agents
suitable road access to the Premises and Lessee’s Facilities. Lessor
shall also be solely responsible for maintaining the access road to the Premises
and Lessee’s Facilities and otherwise keeping them clear for such suitable
access.
(g) Lessee
shall, if requested by Lessor, construct and maintain a fence that encloses the
perimeter of the Premises of a height, size, material, color and type subject to
the mutual agreement of the parties hereto. Such fence and the height, size,
material, color or type thereof shall not adversely affect Lessee, Lessee’s
Facilities, or Lessee’s operations on the Premises.
(h) Lessee
shall comply with Lessor’s reasonable rules and requirements applicable to all
persons that enter the Landfill as may be noticed to Lessee in writing by Lessor
from time to time, and shall cause its officers, directors, employees, agents,
contractors, and invitees to comply with such rules and regulations when
crossing Lessor’s property for ingress to or egress to and from the Premises or
when on Lessor’s property for other purposes related to the transactions
contemplated in this Lease, and shall cause its officers, directors, employees,
agents, contractors, and invitees to comply with such rules and
regulations.
(i) Lessee
will punctually pay, discharge and satisfy all water, gas, telephone,
electricity and power charges and other like payments (“Utility Payments”), charged
on or in respect of the Premises and if Lessee defaults in payment of such
Utility Payments, Lessor may (but shall not be required to) pay the same and in
addition to Lessor’s
other rights, powers and remedies under this Lease, may recover the same from
Lessee. At any time that any Utility Payments that Lessee must pay
remain unpaid and uncontested later than thirty (30) days after they becomes
delinquent, Lessor may give written notice to Lessee of its default, specifying
the default. If Lessee continues to fail to pay any Utility Payments,
or to contest them in good faith within ten (10) days after the written notice,
Lessor may pay the items specified in the notice, and Lessee will, on demand,
reimburse Lessor any amount paid or expended by Lessor for this purpose, plus
interest at the rate of prime rate plus two percent (2%) percent per annum until
Lessee has reimbursed Lessor in full.
(i) Subject
to Article 2.7 of the Purchase Agreement, and at no cost to Lessee (unless
Lessee undertakes modifications, repairs or improvements to Lessor’s Facilities
(referred to in the Purchase Agreement as “Seller’s
Facilities”) pursuant to Article 2.6 or 4.6 of the Purchase Agreement or
otherwise), Lessor and Lessee will work together to attempt to minimize such
adverse impacts to the Landfill, Landfill Gas flow and Lessee’s operations
resulting from the primary interests of Lessor, as identified in Article 2.7 of
the Purchase Agreement; provided that (but also subject to the foregoing) in the
case of an Emergency Condition, Lessor may take any action as may be reasonably
necessary to resolve or rectify any such Emergency Condition, in accordance with
good engineering practice and all applicable laws and regulations, without
consulting with or obtaining input from Lessee. For purposes of this
Lease, “Emergency
Condition” means a condition or situation at the Landfill that presents
an imminent or current physical threat or danger to life or health or presents
an imminent or current physical threat to property or the environment,
including, but not limited to, any condition that has or is likely to result in
a material breach of a site permit or a material breach of applicable laws,
rules, regulations or approvals, including, but not limited to, any
Environmental Law. For purposes of this definition, “material
breach” means a breach that could result in the imposition of any
penalties, fines or other criminal or civil liabilities or obligations or the
suspension or revocation of any permit, license or approval, or could
necessitate the taking of immediate remedial or corrective
actions.
4
(j) Lessor
may curtail, suspend or cease operation of the Landfill as an active waste
disposal facility at any time, in its sole discretion. Lessor may
take any and all actions reasonably required by, and to the extent necessary to
comply with, any laws, rules, regulations, permits, licenses and other
governmental requirements relating to the Landfill ; provided, however, that
except in the case of an Emergency Condition, Lessor shall give Lessee
reasonable prior notice of any such actions to be taken in contravention of the
other terms of this Lease or any related agreement.
(k) Lessee
shall not, and shall not permit any of its affiliates, agents or representatives
to, store, use, release, discharge, or deposit on any portion of the Premises
any hazardous substances except in accordance with Lessor’s rules and
regulations pertaining to the Landfill communicated to Lessee in advance, and
any applicable laws.
(l) Lessee
shall not allow any condition to exist on the Leased Premises that constitutes a
public or private nuisance. Lessor shall not allow any condition
within its control to exist on the Premises that constitutes a public or private
nuisance.
6.
TAXES AND
ASSESSMENTS. Lessor will
promptly pay all taxes and assessments against the Premises as and when they
become due, except that Lessee shall reimburse Lessor for any increase in real
estate taxes and assessments, and for any other taxes or assessments paid by
Lessor that are attributable to the presence of Lessee’s Facilities on the
Premises or to Lessee’s occupying use of the Premises. Lessor and
Lessee agree that they will cooperate, at Lessee’s sole cost, to request that
the Premises and Lessee’s Facilities be separately assessed. In the
event such Improvements are not separately assessed, Lessee shall reimburse
Lessor for the amount of the increase in taxes and assessments reasonably
allocable to Lessee’s Facilities as is mutually agreed upon by Lessor and
Lessee. Within sixty (60) days after receipt of Lessor’s statement
setting out the amount due, Lessee shall have the right but not the obligation,
to contest the validity of any assessment of such taxes or assessments and/or
any relevant authority’s failure to separately assess Lessee’s Facilities, and
Lessor shall reasonably cooperate with and assist Lessee in doing so, at no
out-of-pocket cost to Lessor.
7.
DESTRUCTION
OF BUILDINGS. If Lessee’s
Facilities located on the Premises are partially or totally damaged or destroyed
by any cause, Lessee may elect to terminate this Lease as of the date of the
damage or destruction, by giving notice to Lessor within a commercially
reasonable time following the date of such damage or destruction, in which event
Lessee shall comply with the provisions of Section 5(c).
5
8.
WASTE
PRODUCTS AND PERMITS. At Lessee’s sole
cost, and subject to the provisions of the Purchase Agreement, Lessee shall
deliver condensate extracted from the Landfill Gas by Lessee to the location at
the Landfill designated in Attachment
A. Lessor shall allow Lessee to install and maintain on the
Premises and the Landfill an above-ground condensate storage tank and a pipeline
to transport condensate to the Delivery Point described in Attachment B, both at
locations mutually approved by the parties hereto. Lessor shall
obtain all permits, authorizations, licenses and approvals (or modifications of
any of the foregoing) required to be obtained by Lessor with respect to the
activities contemplated herein and in the Purchase Agreement, and shall maintain
such permits and authorizations in effect at all times during the term of this
Lease. Lessee shall obtain all other permits, authorizations, zoning
changes, consents, licenses and approvals (or modifications of any of the
foregoing) required to be obtained with respect to the activities contemplated
herein and in the Purchase Agreement, and shall maintain such permits and
authorizations in effect at all times during the term of this
Lease. Lessor agrees to cooperate with Lessee, at no out-of-pocket
expense to Lessor, in making application for and obtaining all licenses, permits
and any and all other necessary approvals that may be required for Lessee’s
intended use of the Premises.
9.
CONDEMNATION. If
the Premises or a part thereof sufficient to substantially interfere with the
business for which said Premises are used, shall be condemned, appropriated or
otherwise taken or access to the Premises be impaired by right of eminent
domain, Lessee shall have the right to terminate this Lease on thirty (30) days
written notice to Lessor provided that the election to terminate shall be made
within ninety (90) days after the extent of the taking is known to
Lessee. All damages for condemnation of interests in the Premises and
the easement areas shall be paid to Lessor, and Lessee shall have no claim
thereto; provided, however, that Lessee shall be entitled to any part of such
award related to Lessee’s Facilities that are not relocated or otherwise
compensated for in the condemnation. Lessee shall be entitled, but
shall not be obligated, to bring a separate claim against the condemning entity
for reasonable removal and relocation costs of any removable personal property
that Lessee has the right to remove or for Lessee’s business
damages.
10. DEFAULT.
(a) If
Lessee shall be in default with respect to any of its covenants herein
contained, Lessor shall promptly notify Lessee in writing of the specifics and
circumstances of the default, and if any such default continues for thirty (30)
days after such notice to Lessee, Lessor may terminate this Lease if Lessee
fails to cure any default within the thirty (30)-day period immediately
following receipt of Lessor’s written notice of default; provided that if any
such default is capable of cure, but cannot be cured within the thirty (30)-day
period with reasonable diligence taking into consideration the nature of the
circumstances, Lessee may have additional time to cure the default, but in no
event longer than one hundred eighty (180) days, if within the initial thirty
(30)-day period, Lessee makes commercially reasonable efforts to commence to
cure the default, and is able to cure the default within a commercially
reasonable period of time (not to exceed one hundred eighty (180) days) from the
date upon which written notice of the default is given to
Lessee.
6
(b) If
Lessor shall be in default with respect to any of its covenants herein
contained, Lessee shall promptly notify Lessor in writing of the circumstances
and specifics of any such default, and if such default continues for thirty (30)
days after such notice to Lessor, Lessee may terminate this Lease if Lessor
fails to cure any default within the thirty (30)-day period immediately
following receipt of Lessee’s written notice of default; provided that if any
such default is capable of cure, but cannot be cured within the thirty (30)-day
period with reasonable diligence taking into consideration the nature of the
circumstances, Lessor may have additional time to cure the default, but in no
event longer than one hundred eighty (180) days, if within the initial thirty
(30)-day period, Lessor makes commercially reasonable efforts to commence to
cure the default and, thereafter, diligently pursues the cure to completion, and
is able to cure the default within a commercially reasonable period of time (not
to exceed one hundred eighty (180) days) from the date upon which written notice
of the default is given to Lessor.
(c) If
either party waives a default by the other party, such waiver shall not be
construed or deemed to be a continuing waiver of any subsequent breach or
default on the part of either party.
11. PROHIBITION
AGAINST LESSEE CREATING LIENS AGAINST PREMISES. It is expressly
covenanted and agreed by and between the parties hereto that nothing in this
Lease contained shall authorize Lessee to do any act that will in any way
encumber (except to the extent this Lease creates such an encumbrance) the title
of Lessor in and to the Premises, nor shall the interest or estate of Lessor in
the Premises be in any way subject to any claim by way of lien or encumbrance,
whether by operation of law or by virtue of any express or implied contract by
Lessee, and any claim to or lien upon the Premises arising from any act or
omission of Lessee shall accrue only against the leasehold estate of Lessee and
shall in all respects be subject and subordinate to the paramount title and
rights of Lessor in and to the Premises and the buildings and improvements
thereon. Lessee will not permit the Premises to become subject to any
mechanics’, laborers’ or material men’s lien on account of labor or material
furnished to Lessee in connection with work of any character performed or
claimed to have been performed on the Premises by or at the direction or
sufferance of Lessee; provided, however, that Lessee shall have the right to
contest in good faith and with reasonable diligence the validity of any such
lien or claimed lien.
12. INSURANCE. At
all times during the term of this Lease, Lessor and Lessee shall maintain the
insurance coverages required under the Purchase Agreement.
13.
INDEMNITY. The indemnity
provisions in Article 10 of the Purchase Agreement shall apply to this
Lease.
14. WAIVERS. One
or more waivers of any covenants, condition or agreement herein contained shall
not be construed as a waiver of a further breach of the same covenant, condition
or agreement or of any other covenant, condition or agreement, and the consent
or approval by Lessor to or of any act by Lessee requiring Lessor’s consent or
approval shall not be deemed to waive or render unnecessary Lessor’s consent or
approval to any subsequent similar act by Lessee.
7
15. NOTICES. All notices,
requests, demands, statements and or payment provided for herein shall be in
writing and sent to the parties hereto at the following addresses:
Lessor:
|
Attn:
General Manager
|
Allied
Waste Systems
|
|
000
Xxxxxx Xxxx Xxxx
|
|
Xxxxxxxx,
Xxxxxxx 00000
|
|
With
copy to:
|
Attn: Senior
Director of Renewable Energy Development
|
c/o
Allied Waste Industries, Inc.
|
|
00000
Xxxxx Xxxxxx Xxx
|
|
Xxxxxxx,
Xxxxxxx 00000
|
|
and
copy to:
|
Attn: Xxxxx
Xxxxxxx
|
c/o
Xxxxxxxxx Xxxxx
|
|
0000
Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
|
|
Xxxxxxx,
Xxxxxxx 00000
|
|
Lessee:
|
Attn: Xxxx
Xxxxx
|
President,
GES Live Oak – Xxxxxxx Xxxxx, XXX
|
|
Xxxxx
000, Xxxxx Xxxxx 200
|
|
0000
Xxxxxxxxx Xxxx, XX
|
|
Xxxxxxx,
Xxxxxxx 00000
|
Such
notices, etc. shall be deemed to have been given and received when personally
delivered or upon receipt as evidenced by a U.S. Postal Service Receipt for
Certified or Registered Mail. Either party may change the address to
which communications or payments are to be made by written notice to the other
party as set forth above.
16. WARRANTY.
(a) Lessor
represents and warrants that: (a) Lessor is duly qualified to do business and is
in good standing in the States of Delaware and Georgia; (b) Lessor has full
power and authority to execute, deliver and perform its obligations under this
Lease; (c) the execution, delivery and performance of this Lease by Lessor have
been duly and validly authorized by all necessary action on the part of Lessor;
(d) the execution and delivery of this Lease by Lessor and the performance of
the terms, covenants and conditions contained herein is permitted under all
agreements to which Lessor is a party, or by which the property is bound,
including any and all leases, mortgages and financing agreements, and will not
violate the certificate of incorporation or bylaws of Lessor, or any order of a
court or arbitrator, and will not conflict with and will not constitute a
material breach of, or default under, the provisions of any material contract by
which Lessor is bound; (e) Lessor has not granted any third party any
rights of use, occupancy or otherwise, with respect to the
Premises.
8
(b) Lessee
represents and warrants that: (a) Lessee is duly qualified to do business and is
in good standing in the State of Georgia; (b) Lessee has full power and
authority to execute, deliver and perform its obligations under this Lease; (c)
the execution, delivery and performance of this Lease by Lessee have been duly
and validly authorized by all necessary action on the part of Lessee; (d) the
execution and delivery of this Lease by Lessee and the performance of the terms,
covenants and conditions contained herein will not violate the certificate of
formation or bylaws of Lessee, or any order of a court or arbitrator, and will
not conflict with and will not constitute a material breach of, or default
under, the provisions of any material contract by which Lessee is
bound.
(c) Each
party acknowledges that its representations and warranties as set forth above
will be relied upon by the other party in entering into and performing under
this Lease. The representations and warranties contained in this
Section shall survive the expiration or termination of this Lease.
17. EASEMENTS. Lessor
agrees to grant to Lessee and/or to the appropriate utility providers easements
across the Premises and across property contiguous with the Premises that is
owned or leased by Lessor and that may be reasonably necessary in connection
with Lessee’s performance of the terms and conditions of the Purchase Agreement,
including without limitation for pipelines to transport the Landfill Gas and for
the provision of electric service, all at locations mutually agreed upon by
Lessor and Lessee, provided that Lessor, may, from time to time, and upon the
prior written approval of Lessee, change the locations of any such easements to
the extent Lessor deems necessary in connection with Lessor’s operations at the
Landfill, in which event, notwithstanding any term of the Purchase Agreement to
the contrary, Lessor shall reimburse Lessee for the actual cost of
relocating any of Lessee’s Facilities that may be required in connection with
any such relocation, including without limitation, (i) the revenues and benefits
Lessee would have realized for sale and/or use of Landfill Gas, plus (ii) any
consequences, including without limitation damages, termination and the like
arising with respect to output sales contracts reasonably resulting from any
such relocation, minus (iii) any operating and maintenance costs with respect to
the Lessee’s Facilities that Lessee did not incur because of such
relocation.
18. ENTIRE
AGREEMENT. This Lease and
the Purchase Agreement contain the entire and exclusive agreement
between the parties regarding the lease of the Premises and supersedes and
terminates all prior or contemporaneous arrangements, understandings and
agreements, whether oral or written. This Lease may not be amended or
modified, except by a writing executed by Lessor and Lessee.
9
19. GOVERNING
LAW; VENUE; JURISDICTION; ATTORNEY’S FEES. This Lease shall be
governed by and construed in accordance with the internal laws of the State of
Georgia, without giving effect to any choice or conflict of law provision or
rule (whether of the State of Georgia or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
Georgia. Notwithstanding the foregoing, any legal action arising
under or in connection with this Lease or any other instrument, document or
agreement executed or delivered in connection with this Lease, or in any way
connected with or related or incidental to the dealings of the parties with
respect to this Lease or such other instrument, document or agreement or the
transactions contemplated herein (“Dispute”) shall be brought exclusively in the
state or federal courts located in Xxxxxx County, Georgia. By
execution and delivery of this Lease, with respect to Disputes each of the
parties knowingly, voluntarily and irrevocably: (a) consents, for
itself and in respect of its property, to the exclusive jurisdiction of these
courts; (b) waives any immunity or objection, including any objection to
personal jurisdiction or the laying of venue or based on the grounds of forum
non conveniens, which it may have from or to the bringing of the Dispute in such
jurisdiction; (c) waives any personal service of any summons, complaint or other
process that may be made by any other means permitted by the State of Georgia;
(d) waives any right to trial by jury; (e) agrees that any such Dispute shall be
decided by court trial without a jury; and (f) agrees that any party to this
Lease may file an original counterpart or a copy of this Section with any court
as written evidence of the consents, waivers and agreements of the parties set
forth in this Section. Should any litigation be commenced under this
Lease, the successful party in such litigation shall be entitled to recover, in
addition to such other relief as the court may award, its reasonable attorneys’
fees, expert witness fees, litigation related expenses, and court or other costs
incurred in such litigation or proceeding.
20. ASSIGNMENT. Assignment
of this Lease shall be subject to the same terms, conditions, limitations and
restrictions as are applicable to the parties under the Purchase
Agreement.
21. BINDING
EFFECT. This Lease shall be binding upon and inure to the
benefit of all administrators, executors, personal representatives, heirs,
successors and permitted assigns of the parties hereto. Except as
provided in Section 20, each assignee shall as a precondition to the other
party’s consent execute such written instrument(s) as the other party shall
reasonably require evidencing the assignee’s agreement to be bound by each and
every term of this Lease. The preceding sentence shall not be deemed
to authorize any assignment not specifically authorized elsewhere in this Lease
or in the Purchase Agreement.
22. BROKERAGE. Lessor
and Lessee represent that they have dealt with no broker or agent with respect
to this Lease or the negotiation and execution hereof. Each party
hereby indemnifies and saves and holds the other party harmless against any
claims for brokerage commissions or compensation or other claims of any kind
(including reasonable attorney’s fees and costs) arising out of a breach of the
foregoing representation by the indemnifying party.
23. HEADINGS
AND TITLES. The headings and titles of the articles of this
Lease are inserted for convenience or reference only and shall be disregarded in
construing or interpreting any of its provisions.
10
24. SEVERABILITY. If
any of the provisions, or portions, or applications thereof, of this Lease are
made unenforceable or invalid by any existing or subsequent federal, state or
local requirements, either statutory or administrative, or are held to be
unenforceable or invalid by any court of competent jurisdiction, Lessor and
Lessee shall, except as provided otherwise herein, negotiate an adjustment in
the affected provisions of the Lease with a view toward effecting the purposes
of this Lease, and the validity and enforceability of the remaining provisions
or portions, or applications thereof shall not be affected thereby.
25. NO
PARTNERSHIP. Nothing contained in this Lease shall be
construed to create any association, trust, partnership, or joint venture or
impose a trust or partnership, duty, obligation, or liability or an agency
relationship on, or with regard to, either party. Neither party
hereto shall have the right to bind or obligate the other in any way or manner
unless otherwise provided for herein.
26. CONFLICTS
WITH PURCHASE AGREEMENT. In the event of any conflict between
the provisions of this Lease and the provisions of the Purchase Agreement, the
provisions of the Purchase Agreement shall prevail.
[SIGNATURES
ON FOLLOWING PAGE.]
11
IN WITNESS WHEREOF, Lessor and
Lessee have set their hands and seals as of the date first set out
above.
LESSEE:
|
LESSOR:
|
|
GES
Live Oak – Hickory Ridge, LLC,
|
BFI
Waste Systems of North America, LLC,
|
|
a
Georgia limited liability company
|
a
Delaware limited liability company
|
|
By:
_________________________________________
|
By:
______________________________________________
|
|
Print
Name: __________________________________
|
Print
Name: _______________________________________
|
|
Title:
_______________________________________
|
Title:
____________________________________________
|
|
Date:________________
, 20__
|
Date:
________________ , 20__
|
12
ATTACHMENT
A
PREMISES
DESCRIPTION
[PREMISES
DESCRIPTION TO COME.]
ATTACHMENT
B
[DESCRIPTION
OF DELIVERY POINT TO COME.]