HomeMy WebLinkAboutReso 181-2023 (File 23-962)
Solar Power Purchase Agreement
This Solar Power Purchase Agreement (this “Agreement”) is entered into by the parties listed below (each a “Party” and collectively
the “Parties”) as of [date], 2023 (the “Effective Date”).
Purchaser: Seller:
Name
and
Addres
s
Attention:
Name
and
Addres
s
Peninsula Clean Energy Authority
2075 Woodside Rd.
Redwood City, CA 94061
Attention: Rafael Reyes, Director
of Programs
Phone Phone (650) 260-0087
E-mail E-mail [email protected]
Premises
Ownership
Purchaser owns the Premises.
Tax Status System Owner
Project Name
This Agreement sets forth the terms and conditions of the purchase and sale of solar generated electricity from the solar panel system
described in Exhibit 2 (the “System”) and installed on the real property comprising Purchaser’s premises described or depicted in
Schedule A to Exhibit 2 (the “Premises”), including any buildings and other improvements on the Premises other than the System (the
“Improvements”).
The System shall initially be owned by Seller. “System Owner” means Seller or a subsequent owner of the System in the event that
Seller transfers title to the System. Subsequent System Owner(s) shall be bound to the terms of this Agreement and any Seller obligations
thereunder. As a part of any subsequent transfer, Seller shall ensure that the foregoing is reflected in an enforceable instrument along
with the conveyance of Seller’s interest to a System Owner.
The exhibits listed below are incorporated by reference and made part of this Agreement.
Exhibit 1 Pricing
Exhibit 2 System Description, Delivery Point and Premises
Exhibit 3 General Terms and Conditions
Exhibit 4 Performance Guaranty
Purchaser: Seller: Peninsula Clean Energy Authority
Signature:
Signature:
Printed Name: Printed Name: Shawn Marshall
Title: Title: Chief Executive Officer
Date: Date:
Commented [LC1]: City- Just to confirm, PCE will install
the system on City property and continue to own the system,
but sell the electricity generated by the system to the City?
Commented [VP2R1]: Yes, this is our understanding.
Exh. 1, p. 1
Exhibit 1
Pricing
1. Initial Term: Twenty (20) years, beginning on the date that Commercial Operation is achieved (such date, the “Commercial
Operation Date” and such term, the “Initial Term”). “Commercial Operation” means that the System is mechanically complete,
commences regular, daily operation, complies with all applicable law, has undergone successful system testing, is providing
electricity to the Delivery Point at the System Size specified in Exhibit 2 and has obtained all necessary Approvals (as defined in
Section 5(b) of Exhibit 3), including permission to operate from the Utility and Seller.
2. Additional Terms: Upon mutual written agreement, the Parties may extend the Initial Term for up to two (2) additional terms of
up to five (5) years each beginning on the expiration of the Initial Term or on the expiration of the first Additional Term, as
applicable (each, an “Additional Term”).
3. Contract Price: $[_____] per kilowatt-hour (“kWh”) in the first Contract Year, increasing by [______] percent ([__]%) each
subsequent Contract Year. The first Contract Year shall commence on the Commercial Operation Date, and each subsequent
Contract Year shall commence on the anniversary of the Commercial Operation Date.
4. Contract Price Assumptions. The Contract Price is based on the following assumptions:
a. Statutory prevailing wage rates (e.g., Davis-Bacon) do apply.
b. A Performance Guaranty is being provided.
5. Contract Price Exclusions. Unless Seller and Purchaser have agreed otherwise in writing, and except as otherwise provided in
Section 2(c) of Exhibit 3, the Contract Price excludes the following:
a. Groundwork (including excavation and circumvention of underground obstacles) that is unforeseen despite reasonable
efforts to assess existing site conditions. Upgrades or repair to Purchaser or Utility electrical infrastructure (including
Purchaser or Utility service, transformers, substations, poles, breakers, reclosers, and disconnects). “Utility” means the
electric distribution utility serving Purchaser.
b. Tree removal, tree trimming, mowing and any landscape improvements.
c. Decorative fencing and/or any visual screening materials, decorative enhancements to solar support structures (including
painting, paint matching, masonry/stone work, and any lighting not required to meet the minimum code compliance).
d. Removal of existing lighting, light poles, or concrete light post bases.
e. Roof membrane maintenance or reroofing work.
f. Structural upgrades to the Improvements, including Americans with Disabilities Act (“ADA”) upgrades.
g. Installation of public information screen or kiosk (including accompanying Internet connection, power supply, technical
support and ADA access).
h. Changes in System design caused by any inaccuracy in information provided by Purchaser, including information
regarding Purchaser’s energy use, the Premises and the Improvements, including building plans and specifications.
If such excluded costs will result in an increase to the Contract Price, Seller shall deliver notice to Purchaser of such increase to
the Contract Price not less than sixty (60) days prior to commencement of the installation of the System (“Commencement of
Installation” and such notice, the “Excluded Costs Notice”). If excluded costs will result in an increase to the Contract Price
such that the revised Contract Price would increase by no more than [______] percent ([__]%), Purchaser shall be responsible for
such increased Contract Price and the Contract Price shall be amended to reflect the new Contract Price included in the Excluded
Costs Notice. If such excluded costs will result in an increase to the Contract Price, such that the revised Contract Price would
increase by more than [______] percent ([__]%), Purchaser shall have a right to terminate this Agreement without penalty by
providing notice of such termination within thirty (30) days of delivery of the Excluded Costs Notice.
Commented [LC3]: City- Confirm this is acceptable to
City.
Exh. 1, p. 2
6. Purchaser Termination Payment Schedule:
Contract Year Termination Payment
($)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Exhibit 2
System Description, Delivery Point and Premises
1. System Location:
2. System Size (DC kW):
3. System Description (Expected Structure, etc.):
4. Delivery Point and Premises: Schedule A to this Exhibit 2 contains one or more drawings or images depicting:
a. Premises, including the Improvements (as applicable);
b. Proposed System location at the Premises;
c. Delivery point for electricity generated by the System (the “Delivery Point”);
d. Access points needed for Seller to cause the System to be installed and serviced (building access, electrical room,
stairs, etc.); and
e. Construction assumptions (if any).
Schedule A
1. Physical building address:
2. Number of Stories:
3. Total Square Footage:
4. Year Built:
5. Year of any mechanical/electrical updates:
6. Type of Construction, (example; wood frame, masonry, steel):
7. Description/ Type of roof structure/system:
8. Confirm whether the building is sprinklered:
9. Describe any additional security measures, (example: video surveillance, etc.):
A Site Plan and Single Line Diagram are attached at the end of this document labeled “Attachment 1 to Schedule A of Exhibit
2”.
Exhibit 3
General Terms and Conditions
Exhibit 3 Table of Contents
1. PURCHASE AND SALE OF ELECTRICITY ................................................................................................. 1
2. TERM AND TERMINATION ......................................................................................................................... 1
3. BILLING AND PAYMENT; TAXES .............................................................................................................. 1
4. RECS AND INCENTIVES ............................................................................................................................... 2
5. PROJECT COMPLETION ............................................................................................................................... 3
6. INSTALLATION, OPERATION AND MAINTENANCE ............................................................................. 4
7. MISCELLANEOUS RIGHTS AND OBLIGATIONS OF THE PARTIES ..................................................... 5
8. RELOCATION OF SYSTEM .......................................................................................................................... 6
9. REMOVAL OF SYSTEM UPON TERMINATION OR EXPIRATION ........................................................ 6
10. MEASUREMENT ............................................................................................................................................ 6
11. DEFAULT, REMEDIES AND DAMAGES .................................................................................................... 7
12. REPRESENTATIONS AND WARRANTIES ................................................................................................. 9
13. INSURANCE .................................................................................................................................................. 11
14. OWNERSHIP; OPTION TO PURCHASE ..................................................................................................... 11
15. INDEMNIFICATION AND LIMITATIONS OF LIABILITY ...................................................................... 12
16. CHANGE IN LAW ......................................................................................................................................... 13
17. ASSIGNMENT AND FINANCING .............................................................................................................. 14
18. CONFIDENTIALITY ..................................................................................................................................... 14
19. GENERAL PROVISIONS .............................................................................................................................. 16
Exh. 3, p. 1
Exhibit 3
General Terms and Conditions
1. Purchase and Sale of Electricity. Subject to the terms and conditions of this Agreement, Purchaser shall purchase from Seller,
and Seller shall sell to Purchaser, all of the electricity generated by the System during the Term (as defined in Schedule 2(a)).
Electricity generated by the System shall be delivered to Purchaser at the Delivery Point. Title to and risk of loss for the electricity
generated by the System passes to Purchaser from Seller at the Delivery Point. Seller warrants that it will deliver the electricity
to Purchaser at the Delivery Point free and clear of all liens, security interests, claims, and other encumbrances.
2. Term and Termination.
a. Effective Date; Term. This Agreement is effective as of the Effective Date. The electricity supply period under this
Agreement commences on the Commercial Operation Date (as defined in Section 1 of Exhibit 1) and continues for
the duration of the Initial Term and any Additional Terms, unless earlier terminated as provided for in this Agreement
(collectively, the “Term”).
b. Additional Terms. The Parties may agree in writing to extend this Agreement for up to two (2) Additional Terms at
a Contract Price to be negotiated by the Parties prior to the expiration of the Initial Term or the first Additional Term,
as applicable.
c. Termination Due to Contract Price Adjustments or Lack of Project Viability. If, at any time after the Effective
Date and prior to Commencement of Installation, (i) Purchaser terminates this Agreement pursuant to Section 5 of
Exhibit 1, or (ii) Either Party determines that the installation of the System will not be viable for any reason, then
either Party may terminate this Agreement by providing ten (10) days’ prior written notice to the other Party. Neither
Party shall be liable for any damages in connection with such termination. After Commencement of Installation, the
Contract Price shall not be subject to further adjustment pursuant to Section 5 of Exhibit 1 or otherwise.
d. Termination by Purchaser for Delay. If Commencement of Installation has not occurred within three hundred and
sixty-five (365) days after the Effective Date, Purchaser may terminate this Agreement by providing thirty (30) days’
prior written notice to Seller; provided that this Agreement will not terminate pursuant to this Section 2(d) if Seller
causes to be achieved Commencement of Installation on or before the end of such thirty (30) day notice period or if
Commencement of Installation is delayed due to a Force Majeure Event. Purchaser shall not be liable for any damages
in connection with such termination. For the avoidance of doubt, such event shall not be deemed a Default Event by
Seller and Purchaser’s only remedy shall be the reimbursement by Seller of direct costs reasonably incurred by
Purchaser by reason of the termination.
3. Billing and Payment; Taxes.
a. Monthly Charges. Purchaser shall pay Seller monthly for the electricity generated by the System and delivered to the
Delivery Point at the $/kWh rate shown in Exhibit 1 (the “Contract Price”). The monthly payment for such energy
will be equal to the applicable $/kWh rate multiplied by the number of kWh of electricity generated during the
applicable month, as measured by the Meter (as defined in Section 10). Additional costs for items differing from the
assumptions in Exhibit 1, Section 4 are Purchaser’s responsibility.
b. Monthly Invoices. Seller shall invoice Purchaser monthly for amounts owed by Purchaser hereunder. Such monthly
invoices shall state (i) the amount of electricity produced by the System and delivered to the Delivery Point, (ii) the
rates applicable to, and charges incurred by, Purchaser under this Agreement, and (iii) the total amount due from
Purchaser.
c. Payment Terms. All amounts due under this Agreement are due and payable within thirty (30) days following receipt
of invoice. Any undisputed portion of the invoice amount not paid within such thirty (30) day period shall accrue
interest at the annual rate of two and one-half percent (2.5%) above the Prime Rate (but not to exceed the maximum
rate permitted by law). All payments shall be made in U.S. dollars. “Prime Rate” shall mean the annual prime rate of
interest published in the Wall Street Journal for the applicable period during which interest is incurred pursuant to the
terms of the Agreement.
d. Taxes.
Deleted: Seller
Exh. 3, p. 2
i. Purchaser’s Taxes. Purchaser is responsible for: (A) payment of, or reimbursement of Seller, for all taxes
assessed on the generation, sale, delivery or consumption of electricity produced by the System or the
interconnection of the System to the Utility’s electricity distribution system; (B) real property taxes; and (C) any
sales or use taxes as a result of exercising the option to purchase the System in Section 14(b).
ii. Seller’s Taxes. Seller is responsible for: (A) payment of income taxes or similar taxes imposed on Seller’s
revenues due to the sale of electricity under this Agreement; and (B) personal property taxes imposed on the
System (“Seller’s Taxes”).
e. Budgeting for Contract Price. Upon execution of this Agreement and prior to the commencement of each subsequent
budgetary cycle of Purchaser during the Initial Term (and Additional Term, if any), Purchaser shall take all necessary
action to obtain all necessary budgetary approvals and certifications for payment of all of its obligations under this
Agreement for such budgetary cycle, including, but not limited to including the maximum amount of its annual payment
obligations under this Agreement in its budget submitted to Purchaser’s [City Council] for each year of that budget
cycle.
4. RECs and Incentives.
a. Definitions.
“Governmental Authority” means any foreign, federal, state, local or other governmental, regulatory or administrative
agency, court, commission, department, board, or other governmental subdivision, legislature, rulemaking board, court,
tribunal, arbitrating body or other governmental authority having jurisdiction or effective control over a Party.
“Incentives” means (i) a payment paid by a utility or state or local Governmental Authority based in whole or in part
on the cost or size of the System such as a rebate, (ii) a performance-based incentive paid as a stream of periodic
payments by a utility, state or Governmental Authority based on the production of the System, (iii) investment tax
credits, production tax credits, and similar tax credits, grants or other tax benefits under federal, state or local law,
including, but not limited to, the election to receive a payment with respect to investment tax credits or production tax
credits pursuant to Code Section 6417, and (iv) any other attributes, commodity, revenue stream or payment in
connection with the System (such as ancillary or capacity revenue), in each case of (i) through (iv) relating to the
construction, ownership, use or production of energy from the System, provided that Incentives shall not include RECs.
“REC” means a renewable energy credit or certificate under any state renewable portfolio, standard or federal
renewable energy standard, voluntary renewable energy credit certified by a non-governmental organization, pollution
allowance, carbon credit and any similar environmental allowance or credit and green tag or other reporting right
under Section 1605(b) of The Energy Policy Act of 1992 and any present or future federal, state, or local law, regulation
or bill, and international or foreign emissions trading program, in each case relating to the construction, ownership,
use or production of energy from the System, provided that RECs shall not include Incentives.
b. RECs. The Parties hereby agree that Seller is entitled to the benefit of, and will retain all ownership interests in, the
RECs. Seller shall not sell, assign or otherwise transfer the RECs to a third party. If necessary, Purchaser shall cooperate
with Seller in obtaining, securing and transferring any and all RECs. Purchaser is not obligated to incur any out-of-
pocket costs or expenses in connection with such actions unless reimbursed by Seller. Purchaser shall not make any
filing or statements inconsistent with Seller’s ownership interests in the RECs, nor shall Purchaser attempt to sell, assign
or transfer such RECs. If any RECs are delivered directly to Purchaser, Purchaser shall immediately deliver such items
or amounts to Seller.
c. Incentives. The Parties hereby agree that Seller or a subsequent System Owner, if applicable, and not Purchaser, is
entitled to the benefit of, and will retain all ownership interests in, the Incentives. If necessary, Purchaser shall cooperate
with Seller and any such third-party System Owner in obtaining, securing and transferring any and all Incentives,
including cooperating, as requested by Seller, with respect to any challenges as to Seller obtaining any portion or amount
of the Incentives. Without limiting the foregoing, Purchaser acknowledges that Seller intends to qualify for the elective
payment incentive (the “Elective Pay Incentive”) in Section 6417 of the Internal Revenue Code of 1986, as amended
(the “Code”) with respect to the federal income tax credits under either (the “Applicable Credits”) Code Sections 45
or 48. Purchaser agrees to cooperate with Seller to the extent requested by Seller, so that Seller can (i) qualify for the
Applicable Credits in the context of the Elective Pay Incentive, (ii) obtain a payment of applicable proceeds with respect
to Elective Pay Incentive, (iii) avoid a disallowance, recapture, or reduction of the proceeds with respect to the Elective
Pay Incentive, and (iv) prevent an excess payment as set forth in Code Section 6417(d)(6). Purchaser is not obligated
to incur any out-of-pocket costs or expenses in connection with such actions unless reimbursed by Seller or any such
Exh. 3, p. 3
System Owner. Purchaser shall not make any filing or statements inconsistent with Seller’s or System Owner’s
ownership interests in the Incentives, nor shall Purchaser attempt to sell, assign or transfer such Incentives. If any
Incentives are delivered directly to Purchaser, Purchaser shall immediately deliver such items or amounts to Seller.
5. Project Completion.
a. Project Development. Seller shall use reasonable efforts to pursue or cause to be pursued the development and
installation of the System, subject to Section 2(c) and the remaining provisions of this Section 5.
b. Permits and Approvals. Seller shall use reasonable efforts to cause to be obtained the following at its sole cost and
expense (each, an “Approval”):
i. any zoning, land use and building permits required for Seller to cause the System to be constructed, installed and
operated; and
ii. any agreements and approvals from the Utility necessary in order to interconnect the System to the Utility’s
electric distribution system.
Purchaser shall reasonably cooperate with Seller’s reasonable requests to assist Seller in expeditiously obtaining such Approvals,
including, without limitation, the execution of documents required to be provided by Purchaser to the Utility. The Parties
acknowledge and agree that Purchaser does not have authority or jurisdiction over any other public agency’s ability to grant
Approvals or ability to impose limitations that may affect the System, provided, that such acknowledgment and agreement does
not apply to joint powers authorities or related agencies over which Purchaser asserts authority.
c. Force Majeure.
i. Force Majeure Event. If either Party is unable to timely perform any of its obligations (other than payment
obligations) under this Agreement in whole or in part due to a Force Majeure Event, that Party will be excused
from performing such obligations for the duration of the time that such Party remains affected by the Force
Majeure Event; provided, that such Party uses reasonable efforts to mitigate the impact of the Force Majeure
Event and resumes performance of its affected obligations as soon as reasonably practical. The Party affected by
the Force Majeure Event shall notify the other Party as soon as reasonably practical after the affected Party
becomes aware that it is or will be affected by a Force Majeure Event. If the Force Majeure Event occurs during
the Term and impacts the ability of the System to deliver electricity to the Delivery Point, the Term will be
extended day for day for each day delivery is suspended due to the Force Majeure Event, up to a maximum of
two (2) years.
ii. Extended Force Majeure. If a Force Majeure Event notified by either Party under paragraph (i) above continues
for a consecutive period of three hundred sixty-five (365) days or more, then either Party may elect to terminate
this Agreement without either Party having further liability under this Agreement except: (A) liabilities accrued
prior to termination, (B) Seller’s obligation to cause the System to be removed as required under Section 9 (but
Purchaser shall reimburse Seller for Seller’s removal costs if the Force Majeure Event affects Purchaser and
Purchaser elects to terminate the Agreement) and (C) if Purchaser elects to terminate the Agreement in accordance
with this Section, Purchaser shall pay Seller a termination payment equal to the amount set forth in Section 6 of
Exhibit 1. Notwithstanding the foregoing, if the Force Majeure Event can be corrected through repair or
restoration of the System or other actions by Seller and, prior to expiration of the three hundred sixty-five (365)
day period, Seller provides written evidence to Purchaser that it is diligently pursuing such actions, then Purchaser
shall not have the right to terminate this Agreement so long as Seller continues to diligently pursue such actions.
iii. Definition of “Force Majeure Event.” “Force Majeure Event” means any event or circumstance beyond the
reasonable control of and without the fault or negligence of Seller, including, without limitation: an act of God;
war (declared or undeclared); sabotage; piracy; riot; insurrection; civil unrest or disturbance; military or guerilla
action; terrorism; economic sanction, tariff or embargo; civil strike, work stoppage, slow-down, or lock-out;
explosion; fire; earthquake; tsunami; storm; tornado; blizzard; heatwave; hurricane; flood; lightning; hail; wind;
drought; animals; epidemic; pandemic; action or the failure to act by a Governmental Authority or the Utility,
including, but not limited to, a moratorium on any activities related to this Agreement or the delay or a lack of a
final Approval based on the California Environmental Quality Act (“CEQA”) or other applicable law, provided
that the delay in decision-making is not attributable to the Party claiming a Force Majeure Event and that such
Party has exercised its reasonable efforts to cause such Approval to be obtained; delays in interconnection,
provided that the delay in obtaining interconnection is not attributable to the Party claiming a Force Majeure Event
Exh. 3, p. 4
or its agents; unavailability of electricity from the Utility grid; and failure or unavailability of equipment, supplies
or products outside of Seller’s control or due to a Force Majeure Event. For purposes of the definition of “Force
Majeure,” a Party shall not be considered a Governmental Authority if such Party is claiming the presence of a
Force Majeure Event as an excuse for its failure to timely perform its obligations under this Agreement.
d. Extension of Time. If Seller is delayed in causing the achievement of Commencement of Installation due to a Force
Majeure Event, the time for achievement of Commencement of Installation will be automatically extended to account
for the impact of the delay.
e. Commercial Operation. Seller shall notify Purchaser in writing at least one week prior to the Commercial Operation
Date. Upon Purchaser’s reasonable request, Seller shall provide Purchaser with the “Final Completion Certificate” as
executed by the contractor to Seller responsible for installing the System and the “Final Completion Notification” as
executed by Seller to evidence that the System is ready to begin Commercial Operation. Purchaser may not turn on,
electrify or otherwise operate the System in the absence of prior, written permission from Seller.
6. Installation, Operation and Maintenance.
a. Seller’s General Obligations Regarding the System. Subject to the terms and conditions of this Agreement, Seller
shall use reasonable efforts to cause the System to be designed, engineered, installed, commissioned, monitored,
operated and maintained, in each case in a good and workmanlike manner and in accordance with applicable law and
prudent solar industry practices in the State of California. The Seller shall ensure that the System complies with all
applicable law, rules, regulations and local building codes.
b. System Design Approval. Seller has provided Purchaser with a copy of the System design, and Purchaser has
approved such design. Should any subsequent changes to the System design be made prior to Commencement of
Installation, Purchaser shall be provided with a copy of any such revised System design and Purchaser shall have ten
(10) business days after receipt to approve or disapprove the revised design in writing, such approval not to be
unreasonably withheld. Failure by Purchaser to respond within such ten (10) business day period shall be deemed
approval of the revised System design. If Purchaser disapproves the revised System design, Seller may either (i) cause
the design to be reverted to the original design approved by Purchaser or (ii) terminate this Agreement and such
termination shall be without further liability to Purchaser. If changes to the System design or other changes, including
new information regarding Purchaser’s electricity needs or Seller’s selection of equipment for the System, will result
in a change to any of the data on Exhibit 2 (including, but not limited to the System Size), Exhibit 2 may be revised
if any such changes are approved by both Parties in writing.
c. System Repair and Maintenance. Seller may cause the suspension of delivery of electricity from the System to the
Delivery Point for the purpose of causing the maintenance to and repairs of the System; provided that Seller shall use
reasonable efforts to minimize any interruption in service to the Purchaser and shall provide at least thirty (30) business
days’ advance notice to Purchaser of any scheduled maintenance and repairs. Emergency maintenance and repairs
may be performed in the absence of such notice if necessary to prevent harm to persons or property. Scheduled and
unscheduled maintenance and repairs shall be undertaken at Seller’s sole cost and expense, except that Purchaser shall
reimburse Seller for the reasonable cost of any repairs or maintenance resulting from damage caused by Purchaser, its
agents, employees or contractors.
d. System Outage Allowance. Upon Purchaser’s written request, Seller shall cause the System to be taken off-line for a
total of forty-eight (48) daylight hours (as defined by the United States National Weather Service in the area where
the System is located) during each Contract Year (each event an “Outage” and the forty-eight (48) hour period the
“Outage Allowance”). The Outage Allowance includes all Outage hours undertaken by Seller for maintenance or
repairs for which Purchaser is responsible pursuant to Section 6(c) or requested by Purchaser under this Section 6(d)
(other than due to the fault or negligence of Seller). Purchaser’s request shall be delivered at least forty-eight (48)
hours in advance. Purchaser is not obligated to accept or pay for electricity from the System for Outages up to the
annual Outage Allowance. If the aggregate hours for Outages, including, but not limited to Outages resulting from a
temporary disconnection or removal pursuant to Section 6(f), exceed the Outage Allowance in a given Contract Year
and Purchaser has opted out of receiving retail electric generation service from Seller, Seller shall reasonably estimate
the amount of electricity that would have been delivered to Purchaser during such excess Outages and Purchaser shall
pay Seller for such amount in accordance with this Agreement.
e. Maintenance of Premises. Purchaser shall, at its sole cost and expense, maintain the Premises and Improvements in
good condition and repair. Purchaser, to the extent within its reasonable control, (i) shall ensure that the Premises
remains interconnected to the local Utility grid at all times; and (ii) shall not permit cessation of delivery of electric
Commented [LC4]: City- Confirm City has approved
design and the timeline is acceptable.
Commented [VP5R4]: System design has not yet been
provided by PCE. Our understanding is PCE will provide
the design prior to SSF executing the PPA.
Exh. 3, p. 5
service to the Premises from the local Utility. Purchaser is fully responsible for, and shall properly maintain in full
working order and good repair, the electrical infrastructure on the Purchaser’s side of the Delivery Point, including all
of Purchaser’s equipment that utilizes the System’s outputs. Purchaser shall use reasonable efforts to cooperate with
Seller to comply with any technical standard of the Utility providing electrical power to the Purchaser.
f. Alteration or Repairs to Premises. Not less than ninety (90) days prior to making any alterations or repairs to the
Premises (except for emergency repairs) or any Improvement which has an adverse and unavoidable impact on the
operation and maintenance of the System, Purchaser shall inform Seller in writing and, thereafter, shall use reasonable
efforts to conduct such repairs, alterations or Improvements in compliance with any reasonable request made by Seller
within ten (10) days after having received such written request to mitigate any adverse effect. If any repair, alteration
or Improvement result in a permanent and material adverse economic impact on the System, Purchaser may request
relocation of the System under Section 8 hereof. To the extent that temporary disconnection of the System is necessary
in order for Purchaser to perform such alterations or repairs, Seller shall cause to be performed such work, and any re-
connection of the System, at Purchaser’s cost, subject to Section 6(c), 6(d), and 6(e). To the extent that temporary
removal of the System is necessary in order for Purchaser to perform such alterations or repairs, Seller shall use
reasonable efforts to cause to be performed such removal work within one hundred and eighty (180) days of Seller’s
determination that such temporary removal is required and any such removal and re-installation work shall be at
Purchaser’s cost, subject to Section 6(c), 6(d), and 6(e). Purchaser shall cause to be made any alterations and repairs
in a good and workmanlike manner, in compliance with all applicable laws, codes and permits.
7. Miscellaneous Rights and Obligations of the Parties.
a. Access Rights. In consideration of and in order to effectuate the mutual covenants and terms of this Agreement,
Purchaser hereby grants to Seller and to Seller’s agents, employees, contractors and subcontractors and the Utility (i)
a non-exclusive license running with the Premises (the “Non-Exclusive License”) for access to, on, over, under and
across the Premises from the Effective Date until the date that is one hundred and eighty (180) days following the date
of expiration or earlier termination of this Agreement (the “License Term”), for the purposes of performing all of
Seller’s obligations and enforcing all of Seller’s rights set forth in this Agreement and otherwise as required by Seller
in order to effectuate the purposes of this Agreement, including, but not limited to design, engineering, development,
construction, installation, inspection, interconnection, testing, operation, maintenance, repair, replacement and
removal of the System and all incidental and related uses connected therewith. [In addition to the foregoing, if the
System shall be a ground-mounted System to be located within a secure, fenced area on the Premises, Purchaser
hereby grants to Seller an exclusive, sub-licensable license running with the Premises (the “Exclusive License”, and
together with the Non-Exclusive License, the “Licenses”) for purposes of the installation, operation, use and
maintenance of the System on such exclusively licensed area of the Premises during the License Term.] Seller shall
ensure that it and its employees, agents, contractors and subcontractors comply with Purchaser’s site safety and
security requirements which have been provided to Seller in writing within sixty (60) days of the Effective Date when
on the Premises [(other than in respect of the fenced area governed by the Exclusive License)] during the License
Term. During the License Term, Purchaser shall preserve and protect Seller’s rights under the Licenses and Seller’s
access to the Premises and shall not unreasonably interfere, or permit any third parties under Purchaser’s control to
unreasonably interfere, with such rights or access.
b. OSHA Compliance. Each Party shall comply with all Occupational Safety and Health Act (“OSHA”) requirements
and other similar applicable safety laws and codes with respect to such Party’s performance under this Agreement.
c. Safeguarding the Premises. Purchaser shall maintain the physical security of the Premises and Improvements in the
same manner as Purchaser would maintain all of its other real properties, improvements and facilities. Purchaser shall
not conduct or permit activities on, in or about the Premises or the Improvements that have a reasonable likelihood of
causing damage, impairment or otherwise adversely affecting the System. Purchaser shall indemnify Seller for any
loss or damage to the System to the extent caused by or arising out of (i) Purchaser’s breach of its obligations under
this Section or (ii) the acts or omissions of Purchaser or its employees, agents, or contractors. Without limiting the
foregoing, Seller shall arrange for security of the System, equipment and tools during the construction of the System
and Purchaser shall cooperate with Seller and its contractor with respect to such security measures.
d. Insolation. Purchaser acknowledges that unobstructed access to sunlight (“Insolation”) is essential to Seller’s
performance of its obligations and a material term of this Agreement. Purchaser shall not, to the extent within its
reasonable control, cause or permit any interference with the System’s Insolation, and shall ensure that vegetation on
the Premises adjacent to the System is regularly pruned or otherwise maintained to prevent interference with the
System’s Insolation. If either Party discovers any activity or condition that could diminish the Insolation of the System,
such Party shall immediately notify the other Party and Purchaser shall cooperate with Seller in preserving and
Deleted: may adversely affect
Commented [LC6]: City- should confirm this timeline
works for the City.
Commented [LC7]: City- this provision would require City
to give seller a license to enter City property for the purposes
of the solar system and performing things listed in this
agreement.
Commented [LC8R7]: Same comment for the next
sentence, which grants an additional license if it's a secured
area.
Deleted: use reasonable efforts to
Deleted: Seller may record a customary memorandum
of license in the land records respecting the Licenses.
Deleted: a manner to be expected of a reasonable and
prudent owner of premises and improvements similar
to the Premises and Improvements in nature and
location
Deleted: invitees or separate
Commented [LC9]: City-Note the requirements for sunlight
exposure and vegetation pruning.
Commented [VP10R9]: Trees specified in OMP AC
landscape design should not impact solar panels given
species and proximity to the building. Existing eucalyptus
may be a problem.
Exh. 3, p. 6
restoring the System’s Insolation levels as they existed on the Effective Date.
e. Use and Payment of Contractors and Subcontractors. Seller shall use and shall cause to be used suitably qualified,
experienced and licensed contractors and subcontractors to perform its obligations under this Agreement. However,
Seller shall be responsible for the quality of the work performed by such contractors and subcontractors. Seller shall
pay or shall cause to be paid when due all valid charges from all contractors, subcontractors and suppliers supplying
goods or services to Seller under this Agreement.
f. Liens.
i. Lien Obligations. Purchaser shall not directly or indirectly cause, create, incur, assume or allow to exist any
mortgage, pledge, lien, charge, security interest, encumbrance or other claim of any nature, except such
encumbrances as may be required to allow Seller access to the Premises (each a “Lien”) on or with respect to
the System. Seller shall not directly or indirectly cause, create, incur, assume or allow to exist any Lien on or
with respect to the Premises or the Improvements, other than those Liens which Seller is permitted by law to
place on the Premises due to non-payment by Purchaser of amounts due under this Agreement. Each Party shall
immediately notify the other Party in writing of the existence of any such Lien following such Party’s discovery
of same, and shall promptly (and in all events within thirty (30) days) cause the same to be discharged and
released of record without cost to the other Party; provided, however, that each indemnifying Party (defined
below) has the right to contest any such Lien, so long as it provides a statutory bond or other reasonable
assurances of payment that either removes such Lien from title to the affected property, or that assures that any
adverse judgment with respect to such Lien shall be paid without affecting title to such property.
ii. Lien Indemnity. Each Party shall indemnify the other Party from and against all claims, losses, damages,
liabilities and expenses resulting from any Liens filed against such other Party’s property as a result of the
indemnifying Party’s breach of its obligations under Section 7(f)(i).
8. Relocation of System. If, during the Term, Purchaser ceases to conduct operations at the Premises or vacates the Premises, the
Premises have been destroyed, or the Purchaser is otherwise unable to continue to host the System or accept the electricity
delivered by the System for any other reason (other than a Default Event by Seller), Purchaser shall propose in writing the
relocation of the System, at Purchaser’s cost. Such proposal shall be practically feasible and preserve the economic value of this
Agreement for Seller. The Parties shall seek to negotiate in good faith an agreement for the relocation of the System. Pending
agreement on relocation of the System, Purchaser shall continue to pay Seller at the Contract Price for all electricity that Seller
reasonably estimates it would have been able to deliver to Purchaser in accordance with this Agreement but for the applicable
circumstance described in the first sentence of this paragraph.
9. Removal of System upon Termination or Expiration. Upon the expiration or earlier termination of this Agreement (provided
Purchaser does not exercise its purchase option under Section 14(b)), Seller shall, at its expense (unless expressly provided
otherwise in this Agreement), cause to be removed all of the tangible property comprising the System from the Premises with a
targeted completion date that is no later than one hundred and eighty (180) days after the expiration of the Term. The portion of
the Premises where the System is located shall be returned to substantially its original condition as is reasonably possible as
determined by the City, except for ordinary wear and tear, including the removal of System mounting pads or other support
structures, and repair and restoration of the roof and the roof membrane. Seller is required to cause to be repaired any and all
damage to the Premises caused by removal of the System. Notwithstanding the foregoing, Seller shall not be obligated to remove
or cause to be removed any support structures for the System which are affixed to and below the exposed surface of Purchaser’s
structures or any below grade structures, including foundations and conduits, or any roads. If the System is installed on the roof
of an Improvement, Seller’s warranties under Section 12(c)(i) shall apply, as applicable. Purchaser must provide sufficient
access, space and cooperation as reasonably necessary to facilitate System removal. Purchaser shall comply with Section 7(c)
and Section 13 until removal is complete. If Seller fails to cause the removal of the System within one hundred and eighty (180)
days after expiration of the Term, Purchaser may, at its option, remove the System to a public warehouse and restore the Premises
to its original condition (other than ordinary wear and tear) at Seller’s cost, provided that if Seller pays Purchaser for such costs,
Seller shall not be liable to Purchaser for a Default Event by Seller.
10. Measurement.
a. Meter. The System’s electricity output during the Term shall be measured by Seller’s meter, which shall be a revenue
grade meter that meets ANSI-C12.20 standards for accuracy (the “Meter”). Purchaser shall have access to the metered
energy output data via the monitoring system caused to be installed and maintained by Seller as part of the System.
Commented [LC11]: City- This section and the other
provisions of this section should be discussed further to
make sure they are acceptable to City. In particular, I'm not
sure where specifically the solar panel system would be
located so we should think about if there is ever a chance for
the City to cease operations there or not able to host the
system there. This section provides that City will be
responsible for relocation and also will pay for the electricity
that would otherwise be delivered. It seems to me there
should be some "out" for the City if vacating of the property
or cessation of operation is the result of something not within
the City's control.
Commented [VP12R11]: Very unlikely the City would
cease operations of the pool. Even if operations were
paused, there should still be an opportunity for solar energy
collection to continue.
Commented [LC13]: City- Is this removal deadline
acceptable to the City?
Commented [VP14R13]: Yes
Commented [LC15]: City- Confirm this is acceptable to
City- seller is not required to remove underground structures,
for example.
Commented [VP16R15]: Yes, acceptable.
Commented [LC17]: City- Same comment as above
Exh. 3, p. 7
b. Meter Calibration. Seller shall cause the Meter to be calibrated in accordance with manufacturer’s recommendations.
Notwithstanding the foregoing, Purchaser may install, or cause to be installed, its own revenue-grade meter at the
same location as the Meter. If there is a discrepancy between the data from Purchaser’s meter and the data from the
Meter of greater than two percent (2%) over the course of a Contract Year, then Purchaser may request that Seller
calibrate the Meter at Purchaser’s cost.
c. Internet Connection. At all times during the Term, Purchaser shall maintain and make available, at Purchaser’s cost:
i. A hard-wired ethernet port for connection to System equipment located within fifty (50) physical feet of the
electrical room of the Premises; or, if such hard-wired port is not feasible, Wi-Fi available seven (7) days per
week and twenty-four (24) hours per day;
ii. Information technology support services as needed to provide Internet connectivity via the connection described
in Section 10(c)(i); and
iii. A dedicated IP address for System equipment.
If Purchaser does not maintain such Internet connection described above, Seller will not be able to cause the System
to be monitored or provide the performance guaranty set forth on Exhibit 4. Further, if Seller is not able to monitor
the System, Seller will be required to estimate the System’s power production for purposes of determining the monthly
payment(s) for any such month in which the required Internet connection was not available.
11. Default, Remedies and Damages.
a. Default. Any Party that fails to perform its responsibilities as listed below or experiences any of the circumstances
listed below is deemed a “Defaulting Party”, the other Party is the “Non-Defaulting Party” and each of the following
is a “Default Event”:
i. failure of a Party to pay any amount due and payable under this Agreement, other than an amount that is subject
to a good faith dispute, within ten (10) days following receipt of written notice from the Non-Defaulting Party
of such failure to pay (“Payment Default”);
ii. failure of a Party to perform any material obligation under this Agreement or an act or omission of a Party in
violation of the terms and conditions of this Agreement not addressed elsewhere in this Section 11 within sixty
(60) days following receipt of written notice from the Non-Defaulting Party demanding such cure; provided, that
if the Default Event cannot reasonably be cured within sixty (60) days and the Defaulting Party has demonstrated
prior to the end of that period that it is diligently pursuing such cure, the cure period will be extended for a further
reasonable period of time, not to exceed ninety (90) days, or as agreed upon by the Parties in writing;
iii. such Party fails to provide or maintain in full force and effect any required insurance, if such failure is not remedied
within ten (10) business days after receipt of written notice from the Non-Defaulting Party to the Defaulting Party;
iv. any representation or warranty given by a Party under this Agreement was incorrect in any material respect when
made and is not cured within thirty (30) days following receipt of written notice from the Non-Defaulting Party
demanding such cure;
v. a Party becomes insolvent or is a party to a bankruptcy, reorganization, insolvency, liquidation, receivership,
dissolution, winding-up or relief of debtors, or any general assignment for the benefit of creditors or other similar
arrangement or any event occurs or proceedings are taken in any jurisdiction with respect to the Party which has
a similar effect (or, if any such actions are initiated by a third party, such action(s) is (are) not dismissed within
sixty (60) days); or,
vi.
b. Remedies.
i. Purchaser Default Event Remedies. Upon the occurrence and during the continuation of a Default Event where
the Purchaser is the Defaulting Party, including a Payment Default:
A. Seller may exercise any and all remedies available or granted to it pursuant to law or hereunder, including
seeking by mandamus or other suit, action or proceeding at law or in equity to enforce the Seller’s rights
against the Purchaser, including rights to any payments due hereunder in an action for damages, and to
Commented [LC18]: City- Confirm if the City has any
concerns about this provision.
Commented [VP19R18]: No issue.
Deleted: in the case of Purchaser as the Defaulting
Party only, Purchaser (A) loses its rights to occupy
and enjoy the Premises, unless (I) the Parties agree
upon a relocation under Section 8 above; (B) loses its
right to provide or is in default under Section 7(a); or
(C) prevents Seller from performing any material
obligation under this Agreement unless such action
by Purchaser is (I) permitted under this Agreement, or
(II) cured within ten (10) days after written notice
thereof from Seller.
Exh. 3, p. 8
compel the Purchaser to perform and carry out its duties and obligations under the law and its covenants and
agreements with the Seller as provided herein.
B. Seller may suspend performance of its obligations under this Agreement, including, but not limited to,
turning off the System, until the earlier to occur of the date (A) that Purchaser cures the Default Event in
full, including making payment in full as provided in Section 11(b)(i)(C). Seller’s rights under this Section
11(b)(i)(B) are in addition to any other remedies available to it under this Agreement, at law or in equity.
C. except as otherwise provided herein, this Agreement shall not terminate as a result of such Default Event
and shall continue in full force and effect, and Purchaser shall continue to pay, and Seller shall be entitled
to recover payment for: (x) all electricity delivered by Seller pursuant to Section 3 of this Agreement, and
(y) all electricity that Seller reasonably estimates it would have been able to deliver to Purchaser in
accordance with this Agreement but for the Default Event by Purchase, in each case at the Contract Price,
together with (z) any other amounts due and payable pursuant to this Agreement.
ii. Seller Default Event Remedies. Upon the occurrence and during the continuation of a Default Event where
Seller is the Defaulting Party:
A. Purchaser may exercise any and all remedies available or granted to it pursuant to law or hereunder,
including seeking by mandamus or other suit, action or proceeding at law or in equity to enforce the
Purchaser’s rights against the Seller, including rights to any payments due hereunder in an action for
damages, and to compel the Seller to perform and carry out its duties and obligations under the law and its
covenants and agreements with the Purchaser as provided herein.
B. except as otherwise provided herein, this Agreement shall not terminate as a result of such Default Event and
shall continue in full force and effect, and Seller and Purchaser shall continue to pay all amounts due and
payable pursuant to this Agreement.
iii. Optional Termination by Purchaser. In addition to the remedies provided for in Section 11(b)(i) and Section
11(b)(ii), upon the occurrence and during the continuation of a Default Event where Seller is the Defaulting
Party, the Purchaser may terminate this Agreement as further set forth in this Section 11(b)(iii) by providing
thirty (30) days prior written notice to the Seller; provided, that, in the case of a Default Event under Section
11(a)(v) where the Seller is the Defaulting Party, no such notice period shall be required. Upon termination
pursuant to this Section 11(b)(iii), Seller shall pay to Purchaser an amount equal to the sum of (1) the present
value of the excess, if any, of the reasonably expected cost of electricity delivered by the Utility over the Contract
Price for the reasonably expected production of the System for a period of the lesser of five (5) years or the
remainder of the Initial Term or the then current Additional Term, as applicable; (2) all direct costs reasonably
incurred by Purchaser by reason of the termination; and (3) any and all other amounts previously accrued under
this Agreement and then owed by Seller to Purchaser (the “Seller Termination Payment”). The Seller
Termination Payment determined under this Section 11(b)(iii) cannot be less than zero.
iv. Optional Termination by Seller. In addition to the remedies provided for in Section 11(b)(i) and Section
11(b)(ii), upon the occurrence and during the continuation of a Default Event where Purchaser is the Defaulting
Party, the Seller may terminate this Agreement as further set forth in this Section 11(b)(iv) by providing thirty
(30) days prior written notice to the Seller; provided, that, in the case of a Default Event under Section 11(a)(v)
where the Purchaser is the Defaulting Party, no such notice period shall be required. Upon termination pursuant
to this Section 11(b)(iv), Purchaser shall pay to Seller an amount equal to the sum of (1) the applicable amount set
forth in the Purchaser Termination Payment Schedule of Section 6 of Exhibit 1, and (2) any other amounts
previously accrued under this Agreement and then owed by Purchaser to Seller (collectively, the “Purchaser
Termination Payment” and, together with the Seller Termination Payment, the “Termination Payment”).
v. Severability of Remedies. If any remedy in Section 11(b) is held by a court of competent jurisdiction to be in
conflict with any statute, constitutional provision, regulation or other rule of law, or is otherwise held to be
unenforceable for any reason whatsoever, such circumstances shall not have the effect of rendering the other
remedies herein contained invalid, inoperative, or unenforceable to any extent whatsoever. If any one or more
of the provisions contained in Section 11(b) of this Agreement shall for any reason be held to be invalid, illegal
or unenforceable in any respect, then such provision or provisions shall be deemed severable from the remaining
provisions contained in this Section 11(b) and such invalidity, illegality or unenforceability shall not affect any
other provision of this Agreement, and this Agreement shall be construed as if such invalid or illegal or
unenforceable provision had never been contained herein. The Parties hereby declare that they each would have
executed this Agreement and each and every other section hereof irrespective of the fact that any one or more
Commented [LC20]: How is this amount calculated?
Deleted: The Purchaser Termination Payment
determined under this Section 11(b)(iv) cannot be less
than zero.
Exh. 3, p. 9
sections of this Section 11(b) may be held illegal, invalid or unenforceable.
vi. Liquidated Damages. The Parties agree that, if Seller terminates this Agreement prior to the expiration of the
Term pursuant to Section 11(b)(iv), actual damages would be difficult to ascertain, and the Purchaser
Termination Payment determined in accordance with Section 11(b)(iv) is a reasonable approximation of the
damages suffered by Seller as a result of early termination of this Agreement and is not a penalty.
c. Obligations Following Termination. If a Party terminates this Agreement pursuant to Section 11(b)(iii), or Section
11(b)(iv), then following such termination, Seller shall cause and shall have the right to cause the equipment
constituting the System to be removed in compliance with Section 9 at the sole cost and expense of the Defaulting
Party, provided, however that Seller shall not be required to cause the System to be removed following the occurrence
of a Default Event by Purchaser, unless Purchaser has paid the Purchaser Termination Payment to Seller or pre-pays
the cost of removal and restoration reasonably estimated by Seller.
i. Reservation of Rights. Except in the case of a termination under Section 11(b)(iii) or Section 11(b)(iv) and
payment of a Termination Payment, if any, determined pursuant to as provided therein, nothing in this Section
11 limits either Party’s right to pursue any remedy under this Agreement, at law or in equity, including with
respect to the pursuit of an action for damages by reason of a breach or Default Event under this Agreement.
ii. Mitigation Obligation. Regardless of whether this Agreement is terminated for a Default Event, the Non-
Defaulting Party must make reasonable efforts to mitigate its damages as the result of such Default Event;
provided that such obligation shall not reduce the Defaulting Party’s obligation to pay their full respective
termination payment amounts.
iii. No Limitation on Payments. Nothing in this Section 11 excuses a Party’s obligation to make any payment when
due under this Agreement, including with respect to payments for electricity that would have been delivered to
Purchaser but for a Purchaser breach or Default Event.
12. Representations and Warranties.
a. General Representations and Warranties. Each Party represents and warrants to the other the following:
i. Such Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its
formation; the execution, delivery and performance by such Party of this Agreement have been duly authorized
by all necessary governmental action, and do not and will not violate any law; and this Agreement is the valid
obligation of such Party, enforceable against such Party in accordance with its terms (except as may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium and other similar laws now or hereafter in
effect relating to creditors’ rights generally).
ii. Such Party has obtained all licenses, authorizations, consents and approvals required by applicable law and any
Governmental Authority or other third-party and necessary for such Party to own its assets, carry on its business
and operations and to execute and deliver this Agreement; and such Party is in compliance with all laws that
relate to this Agreement in all material respects.
b. Purchaser’s Representations and Warranties. Purchaser represents and warrants to Seller the following:
i. Licenses. (A) Purchaser has title to and is the fee owner of the Premises such that Purchaser has the full right,
power and authority to enter into and perform all of its obligations under this Agreement, (B) this Agreement
does not violate any law, ordinance, rule or other governmental restriction applicable to Purchaser or the
Premises and is not inconsistent with and will not result in a breach or default under any agreement by which
Purchaser is bound or that affects the Premises, and (C) there are no deeds of trust, mortgages or similar security
instruments with a lien against the Premises.
ii. Other Agreements. Neither the execution and delivery of this Agreement by Purchaser nor the performance by
Purchaser of any of its obligations under this Agreement conflicts with or will result in a breach or default under
any agreement or obligation to which Purchaser is a party or by which Purchaser is bound.
iii. Accuracy of Information. All information provided by Purchaser to Seller, as it pertains to (A) the Premises,
(B) the Improvements on which the System is to be installed, if applicable, (C) Purchaser’s planned use of the
Premises and any applicable Improvements, and (D) Purchaser’s estimated electricity requirements, is accurate
Deleted: Purchaser’s
Deleted: full Purchaser Termination Payment set
forth in Section 6 of Exhibit 1 following a Default
Event by Purchaser
Exh. 3, p. 10
in all material respects.
iv. Purchaser Status. Purchaser is not a public utility or a public utility holding company and is not subject to
regulation as a public utility or a public utility holding company.
v. Limit on Use. No portion of the electricity generated by the System shall be used to heat a swimming pool.
c. Seller’s Warranties.
i. Seller shall provide for a warranty on roof of any Improvement for damages caused by penetrations or other
destructions during System installation. This roof warranty shall terminate upon the earlier of (A) five (5) years
following the Commercial Operation Date and (B) the expiration of the warranty applicable to such roof provided
by Purchaser’s roofing contractor.
ii. If Seller or its agents damage any other part of the Premises or any Improvement (including roof damages not
covered under Section 12(c)(i) above), Seller shall repair or reimburse Purchaser for such damage, as agreed by
the Parties and subject to Section 15.
d. NO OTHER WARRANTY. THE WARRANTIES SET FORTH IN SECTIONS 12(a) AND 12(c) OF THIS
AGREEMENT ARE PURCHASER’S SOLE AND EXCLUSIVE BASIS FOR ANY CLAIM OR LIABILITY
ARISING OUT OF OR IN CONNECTION WITH THIS SECTION 12, WHETHER ARISING IN CONTRACT,
TORT (INCLUDING NEGLIGENCE), STRICT LIABILITY OR OTHERWISE. OTHER THAN AS EXPRESSLY
SET FORTH IN SECTIONS 12(a) AND 12(c), NO WARRANTY, WHETHER STATUTORY, WRITTEN, ORAL,
EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY AND
FITNESS FOR A PARTICULAR PURPOSE, OR WARRANTIES ARISING FROM COURSE OF DEALING OR
USAGE OF TRADE, APPLIES UNDER THIS AGREEMENT. THE PERFORMANCE GUARANTY SET FORTH
IN EXHIBIT 4 REPRESENTS A SEPARATE CONTRACT BETWEEN PURCHASER AND THE ISSUER OF THE
PERFORMANCE GUARANTY. IF THE ISSUER OF THE PERFORMANCE GUARANTY (OR ANY
SUBSEQUENT ASSIGNEE) AND THE SELLER ARE NOT THE SAME PERSON, NO RIGHTS PROVIDED TO
PURCHASER BY THE PERFORMANCE GUARANTY MAY BE ASSERTED UNDER THIS AGREEMENT, AND
NO CLAIM UNDER THE PERFORMANCE GUARANTY WILL AFFECT PURCHASER’S OBLIGATIONS
UNDER THIS AGREEMENT.
Commented [LC21]: City- confirm this is acceptable.
Commented [VP22R21]:
Deleted: If Seller causes to be penetrated the roof of
any Improvement on which the System is installed,
during System installation or any System repair,
Deleted: damage
Deleted: these roof penetrations
Exh. 3, p. 11
13. Insurance.
a. Insurance Coverage. At all times during the Term, the Parties shall maintain the following insurance, as applicable:
i. Seller’s Insurance. Seller shall maintain (A) property insurance on the System for the replacement cost thereof,
(B) commercial general liability, employers liability and automobile liability insurance with primary coverage
of at least $1,000,000 per occurrence, an excess liability limit of $5,000,000, for a total of $6,000,000 in the
aggregate, and (C) workers’ compensation insurance as required by law. Seller’s coverage may be provided as
part of an enterprise insurance program.
ii. Purchaser’s Insurance. Purchaser shall maintain commercial general liability insurance with coverage of at least
$2,000,000 per occurrence.
b. Policy Provisions. The insurance policies referenced in Section 13(a) shall (i) contain a provision whereby the insurer
agrees to give the other Party at least thirty (30) days (ten (10) days for non-payment of premiums) written notice
before the insurance is cancelled, or terminated, (ii) be written on an occurrence basis, and (iii) be maintained with
companies either rated no less than A-VII as to Policy Holder’s Rating in the current edition of A.M. Best’s Insurance
Guide or otherwise reasonably acceptable to the other Party.
c. Certificates. Upon the other Party’s request, each Party shall deliver to the other Party certificates of insurance
evidencing the above required coverage. A Party’s receipt, review or acceptance of such certificate shall in no way
limit or relieve the other Party of the duties and responsibilities to maintain insurance as set forth in this Agreement.
d. Deductibles. Each Party shall pay or cause to be paid its own insurance deductibles, except in the case of claims (i)
resulting from a breach of this Agreement, in which case the breaching Party is responsible for payment of the non-
breaching Party’s deductible for any responding insurance, and (ii) covered by an indemnity set forth in this
Agreement.
14. Ownership; Option to Purchase.
a. Ownership of System.
i. Ownership; Personal Property. System Owner or its assignee shall be the legal and beneficial owner of the
System and the System will remain the personal property of System Owner or such assignee and will not attach
to or be deemed a part of, or fixture to, the Premises or any Improvement on which the System is installed. Each
of the Seller and Purchaser agree that System Owner or its assignee is the tax owner of the System and all tax
filings and reports shall be filed in a manner consistent with this Agreement. The System will at all times retain
the legal status of personal property as defined under Article 9 of the Uniform Commercial Code.
ii. Notice to Purchaser Lienholders. Purchaser shall use reasonable efforts to place all parties having a Lien on
the Premises or any Improvement on which the System is installed on notice of the ownership of the System and
the legal status or classification of the System as personal property. If any mortgage or fixture filing against the
Premises could reasonably be construed as prospectively attaching to the System as a fixture of the Premises,
Purchaser shall provide a disclaimer or release from such lienholder.
iii. Fixture Disclaimer. Purchaser consents to the filing of a disclaimer of the System as a fixture of the Premises in
the office where real estate records are customarily filed in the jurisdiction where the Premises are located. If, at
any point after the Effective Date, Purchaser is not the fee owner of the Premises, Purchaser shall obtain such
consent from such fee owner. For the avoidance of doubt, in either circumstance Seller has the right to file such
disclaimer.
iv. SNDA. Upon request, Purchaser shall deliver to Seller a subordination and non-disturbance agreement in a form
mutually acceptable to Seller and Purchaser, regarding any mortgagee with a Lien on the Premises, and other
Persons holding a similar interest in the Premises.
v. Eviction Notice. Purchaser hereby represents and warrants that it is the legal owner of the Premises. To the extent
that Purchaser does not own the Premises or any Improvement on which the System is installed after the Effective
Date, Purchaser shall provide to Seller immediate written notice of any such change in ownership and receipt of
notice of eviction from the Premises or applicable Improvement or termination of Purchaser’s lease of the
Premises and/or Improvement.
Commented [LC23]: City- confirm with Risk Manager that
these requirements can be satisfied. It appears to me they are
fine.
Commented [LC24]: City- we should confirm the solar
system is deployed on City properties and facilities.
Commented [VP25R24]: Will only be installed on City
properties/facilities.
Exh. 3, p. 12
b. Option to Purchase.
i. Exercise of Option. At the end of the Initial Term and each Additional Term, so long as Purchaser is not in
default under this Agreement and it is beyond the date that is the sixth (6th) anniversary of the Commercial
Operation Date, Purchaser may purchase the System from System Owner on any such date for a purchase price
equal to the Fair Market Value of the System applicable as of the date of the transfer of title to the System.
Purchaser shall notify Seller of its intent to purchase at least ninety (90) days and not more than one hundred
eighty (180) days prior to the end of the Initial Term or Additional Term, as applicable, and the purchase shall
be completed prior to the end of the Initial Term or Additional Term, as applicable.
ii. Fair Market Value. The “Fair Market Value” of the System shall be determined by mutual agreement of the
Parties; provided, however, if the Parties cannot agree to a Fair Market Value within thirty (30) days after
Purchaser has delivered to Seller a notice of its intent to purchase the System, the Parties shall select a nationally
recognized independent appraiser with experience and expertise in the solar photovoltaic industry to determine
the Fair Market Value of the System. Such appraiser shall act reasonably and in good faith to determine the Fair
Market Value of the System on an installed basis and shall set forth such determination in a written opinion
delivered to the Parties. The valuation made by the appraiser will be binding upon the Parties in the absence of
fraud or manifest error. The costs of the appraisal shall be borne by the Parties equally.
iii. Title Transfer; Warranties; Manuals. If Purchaser exercises its purchase option pursuant to Section 14(b)(i)
above, title to the System and manufacturers’ warranties shall transfer to Purchaser upon System Owner’s receipt
of the purchase price and execution by System Owner and Purchaser of a written instrument or agreement to
effect such transfer to be negotiated between System Owner and Purchaser. The System will be sold “as is, where
is, with all faults.” Upon purchase of the System, Purchaser shall assume complete responsibility for the
operation and maintenance of the System and liability for the performance of (and risk of loss for) the System,
and, except for any Seller obligations that survive termination under Section 19(d), System Owner will have no
further liabilities or obligations hereunder for the System.
15. Indemnification and Limitations of Liability.
a. General. Each Party (the “Indemnifying Party”) shall defend, indemnify and hold harmless the other Party, its
officials, officers, representatives, agents and employees (collectively, the “Indemnified Parties”), from and against
any loss, damage, expense, liability and other claims, including court costs and reasonable attorneys’ fees (collectively,
“Liabilities”) resulting from (i) any Claim (as defined in Section 15(c)) relating to the Indemnifying Party’s breach
of any representation or warranty set forth in Section 12 and (ii) injury to or death of persons, and damage to or loss
of property to the extent caused by or arising out of the negligent acts or omissions of, or the willful misconduct of,
the Indemnifying Party (or its contractors, agents or employees) in connection with this Agreement; provided,
however, that nothing herein will require the Indemnifying Party to indemnify the Indemnified Parties for any
Liabilities to the extent caused by or arising out of the negligent acts or omissions of, or the willful misconduct of, an
Indemnified Party. This Section 15(a) does not apply to Liabilities arising out of or relating to any form of Hazardous
Substances or other environmental contamination, such matters being addressed exclusively by Section 15(d).
b. Permission to Operate Indemnification. Each Party shall defend, indemnify and hold harmless the other Party from
and against any Liabilities resulting from the Indemnifying Party’s breach of its obligations under Section 15(c).
c. Notice and Participation in Third-Party Claims. The Indemnified Party shall give the Indemnifying Party written
notice with respect to any Liability asserted by a third-party (a “Claim”), as soon as possible upon the receipt of
information of any possible Claim or of the commencement of such Claim. The Indemnifying Party may assume the
defense of any Claim, at its sole cost and expense, with counsel designated by the Indemnifying Party and reasonably
satisfactory to the Indemnified Party. The Indemnified Party may, however, select separate counsel if both Parties are
defendants in the Claim and such defense or other form of participation is not reasonably available to the Indemnifying
Party. The Indemnifying Party shall pay the reasonable attorneys’ fees incurred by such separate counsel until such
time as the need for separate counsel expires. The Indemnified Party may also, at the sole cost and expense of the
Indemnifying Party, assume the defense of any Claim if the Indemnifying Party fails to assume the defense of the
Claim within a reasonable time. Neither Party may settle any Claim covered by this Section 15(c) unless it has obtained
the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed. The
Indemnifying Party has no liability under this Section 15(c) for any Claim for which such notice is not provided if the
failure to give notice prejudices the Indemnifying Party.
d. Environmental Indemnification.
Commented [LC26]: City- note the option of purchasing
the system after the 6th year from the operation date.
Commented [VP27R26]: Noted.
Deleted: , its affiliates and the other Party’s and its
affiliates’ respective directors, officers, shareholders,
partners, members,
Deleted: Purchaser
Deleted: Seller Indemnified Parties
Deleted: Purchaser’s
Deleted: Purchaser’s
Exh. 3, p. 13
i. Seller Indemnity. Seller shall indemnify, defend and hold harmless all of Purchaser’s Indemnified Parties from
and against all Liabilities arising out of or relating to the existence at, on, above, below or near the Premises of
any Hazardous Substance (as defined in Section 15(d)(iii)) to the extent deposited, spilled or otherwise caused
by Seller or any of its contractors, agents or employees.
ii.
iii. Notice. Each Party shall promptly notify the other Party if it becomes aware of any Hazardous Substance on or
about the Premises generally or any deposit, spill or release of any Hazardous Substance. “Hazardous
Substance” means any chemical, waste or other substance (a) which now or hereafter becomes defined as or
included in the definition of “hazardous substances,” “hazardous wastes,” “hazardous materials,” “extremely
hazardous wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic pollutants,” “pollution,”
“pollutants,” “regulated substances,” or words of similar import under any laws pertaining to the environment,
health, safety or welfare, (b) which is declared to be hazardous, toxic, or polluting by any Governmental
Authority, (c) exposure to which is now or hereafter prohibited, limited or regulated by any Governmental
Authority, (d) the storage, use, handling, disposal or release of which is restricted or regulated by any
Governmental Authority, or (e) for which remediation or cleanup is required by any Governmental Authority.
e. Limitations on Liability.
i. No Consequential Damages. Except with respect to indemnification of third-party claims pursuant to Section 15,
fraud or willful misconduct, neither Party nor its directors, officers, shareholders, partners, members, agents and
employees subcontractors or suppliers will be liable for any indirect, special, incidental, exemplary, or
consequential loss or damage of any nature (including, without limitation, lost revenues, lost profits, lost business
opportunity or any business interruption) arising out of their performance or non-performance hereunder even if
advised of such. Notwithstanding the previous sentence, the Purchaser Termination Payment set forth in Section
6 of Exhibit 1 shall be deemed to be direct, and not indirect or consequential damages for purpose of this Section
15(e)(i).
f. Comparative Negligence. Where negligence is determined to have been joint, contributory or concurrent, each Party
shall bear the proportionate cost of any Liability.
16. Change in Law.
a. Impacts of Change in Law. If Seller determines that a Change in Law has occurred or will occur that has or will have
a material adverse effect on Seller’s rights, entitlement, obligations or costs under this Agreement, then Seller may so
notify the Purchaser in writing of such Change in Law. Within thirty (30) days following receipt by the Purchaser of
such notice, the Parties shall meet and attempt in good faith to negotiate such amendments to this Agreement as are
reasonably necessary to preserve the economic value of this Agreement to both Parties. If the Parties are unable to
agree upon such amendments within such thirty (30) day period, then Seller may terminate this Agreement and cause
the System to be removed and the Premises to be restored in accordance with Section 9 without either Party having
further liability under this Agreement except with respect to liabilities accrued prior to the date of termination.
b. Illegality or Impossibility. If a Change in Law renders this Agreement, or Seller’s performance of this Agreement,
either illegal or impossible (which impossibility shall not include a Force Majeure event as defined in this Agreement),
then Seller may terminate this Agreement immediately upon notice to Purchaser without either Party having further
liability under this Agreement except with respect to liabilities accrued prior to the date of termination.
c. “Change in Law” means (i) the enactment, adoption, promulgation, modification or repeal after the Effective Date
of any applicable law or regulation, (ii) the imposition of any material conditions on the issuance or renewal of any
applicable permit by an entity other than Purchaser after the Effective Date (notwithstanding the general requirements
contained in any applicable Permit at the time of application or issue to comply with future laws, ordinances, codes,
rules, regulations or similar legislation), or (iii) a change in any utility rate schedule or tariff approved by any
Governmental Authority that materially alters the financial obligations of Seller under this Agreement.
17. Assignment and Financing.
a. Assignment.
Deleted: Purchaser Indemnity. Purchaser shall
indemnify, defend and hold harmless all of Seller’s
Indemnified Parties from and against all Liabilities
arising out of or relating to the existence at, on,
above, below or near the Premises of any Hazardous
Substance, except (A) to the extent deposited, spilled
or otherwise caused by Seller or any of its
contractors, agents or employees or, (B) where the
deposit, spill, or existence of the Hazardous
Substance is not caused by Seller or any of its
contractors or agents, to the extent the condition is
known by Seller or any of its contractor or agents and
is worsened as a result of the negligent acts or
omissions, willful misconduct, or breach of Contract
by Seller or any of its contractors, agents or
employees.
Deleted: <#>Actual Damages. Except with respect to
indemnification of Claims pursuant to this Section 15,
and except as otherwise limited in Section 12(d),
Seller’s aggregate liability under this Agreement
arising out of or in connection with the performance
or non-performance of this Agreement cannot exceed
$1,000,000. The provisions of this Section 15(e)(ii)
will apply whether such liability arises in contract,
tort, strict liability or otherwise.¶
Deleted: <#>EXCLUSIVE REMEDIES. TO THE
EXTENT THAT THIS AGREEMENT SETS FORTH
SPECIFIC REMEDIES FOR ANY CLAIM OR
LIABILITY, SUCH REMEDIES ARE THE
AFFECTED PARTY’S SOLE AND EXCLUSIVE
REMEDIES FOR SUCH CLAIM OR LIABILITY,
WHETHER ARISING IN CONTRACT, TORT
(INCLUDING NEGLIGENCE), STRICT LIABILITY
OR OTHERWISE.¶
Exh. 3, p. 14
i. Restrictions on Assignment. Subject to the remainder of this Section 17(a), this Agreement may not be assigned
in whole or in part by either Party without the prior written consent of the other Party, which consent may not be
unreasonably withheld or delayed. .
ii. Permitted Assignments. Notwithstanding Section 17(a)(i), Seller may, without the prior written consent of
Purchaser but with advance written notice to Purchaser, assign, mortgage, pledge or otherwise directly or
indirectly assign its interests in this Agreement to (A) any Financing Party (as defined in Section 17(b)), (B) any
entity through which Seller is obtaining financing from a Financing Party, or (C) any affiliate of Seller or any
person succeeding to all or substantially all of the assets of Seller; provided, that, the assignment does not
negatively affect the terms of this Agreement or Seller’s ability to perform hereunder or thereunder. Seller is not
released from liability hereunder as a result of any assignment to an affiliate unless the assignee assumes Seller’s
obligations hereunder by binding written instrument.
iii. Successors and Permitted Assignees. This Agreement is binding on and inures to the benefit of successors and
permitted assignees. The restrictions on assignment contained herein do not prohibit or otherwise limit changes
in control of Seller.
b. Financing. The Parties acknowledge that Seller and/or System Owner may obtain debt or equity financing or other
credit support from lenders, investors or other third parties (each, a “Financing Party”) in connection with the
installation, construction, ownership, operation and maintenance of the System. In furtherance of Seller’s and/or
System Owner’s financing arrangements and in addition to any other rights or entitlements of Seller or System
Owner’s under this Agreement, Purchaser shall timely execute any consents to assignment (which may include notice,
cure, attornment and step-in rights) or estoppels and negotiate any amendments to this Agreement that may be
reasonably requested by Seller and/or System Owner or the Financing Parties; provided, that such estoppels, consents
to assignment or amendments do not alter the fundamental economic terms of this Agreement.
c. Termination Requires Consent. Seller and Purchaser agree that any right of Seller to terminate this Agreement is
subject to the prior written consent of any Financing Party. Purchaser’s rights to terminate this Agreement shall not
be affected.
18. Confidentiality.
a. Confidential Information. To the maximum extent permitted by applicable law including but not limited to the Public
Records Act, if either Party provides business secret or trade secret information (“Confidential Information”) to the
other or, if in the course of performing under this Agreement or negotiating this Agreement a Party learns Confidential
Information of the other Party, the receiving or learning Party shall (i) protect the Confidential Information from
disclosure to third parties with the same degree of care accorded its own confidential and proprietary information, and
(ii) refrain from using such Confidential Information, except in the negotiation, performance, enforcement and, in the
case of Seller, financing, of this Agreement.
b. Permitted Disclosures. Notwithstanding Section 18(a):
i. A Party may provide such Confidential Information to its affiliates and to its and its affiliates’ respective officers,
directors, members, managers, employees, agents, contractors, consultants and Financing Parties (collectively,
“Representatives”), and potential direct or indirect assignees of this Agreement if such potential assignees are
first bound by a written agreement or legal obligation restricting use and disclosure of Confidential Information.
Each Party is liable for breaches of this provision by any person to whom that Party discloses Confidential
Information.
ii. Confidential Information does not include any information that (A) becomes publicly available other than
through breach of this Agreement, (B) is required to be disclosed to a Governmental Authority under applicable
law or pursuant to a validly issued subpoena, (C) is independently developed by the receiving Party, or (D)
becomes available to the receiving Party without restriction from a third party under no obligation of
confidentiality. If disclosure of information is required by a Governmental Authority, the disclosing Party shall,
to the extent permitted by applicable law, notify the other Party of such required disclosure within a reasonable
time upon becoming aware of such required disclosure.
iii. Each Party hereto acknowledges and agrees that this Agreement and information and documentation provided
in connection with this Agreement may be subject to the California Public Records Act (Government Code
Deleted: Purchaser may not withhold its consent to
an assignment proposed by Seller where the proposed
assignee has the financial capability and experience
necessary to operate and maintain solar photovoltaic
systems such as the System in accordance with
prudent solar industry practices in the State of
California
Deleted: confidential information
Commented [LC28]: This term is too broad and needs to be
defined, as the City is not in a position to make everything
confidential or determine whether something is confidential
given its obligation to comply with the Public Records Act.
Deleted: Subject
Deleted: to Section 18(b)(iii), the Parties hereby agree
to treat Sections 3 and 6 of Exhibit 1 as Confidential
Information of each Party for purposes of this Section
18 and to redact the numbers set forth in such Sections
from any publication or disclosure of this Agreement.
Deleted: promptly
Deleted: and shall reasonably cooperate with the
other Party’s efforts to limit the disclosure to the
extent permitted by applicable law
Commented [LC30]: City- note the agreement would have
City provide notice to seller regarding PRA requests. I think
this is reasonable but please let me know if you have
concerns.
Commented [VP31R30]: Acceptable.
Exh. 3, p. 15
Section 7920.000 et seq.). Upon request or demand from any third person not a Party to this Agreement for
production, inspection and/or copying of this Agreement or other Confidential Information, the recipient of such
request or demand shall make reasonable efforts to notify the other Party in writing in advance of any disclosure
that the request or demand has been made. Although the California Public Records Act recognizes that certain
confidential business or trade secret information may be protected from disclosure, Purchaser may not be in a
position to establish that the information that Seller or a System Owner submits is Confidential Information. If a
request is made for Confidential Information and the requester takes legal action seeking release of the materials
it believes does not constitute Confidential Information, Seller and subsequent System Owner agree to indemnify,
defend and hold harmless Purchaser, its officials, agents and employees, from any judgment, fines, penalties,
and award of attorneys’ fees awarded against Purchaser in favor of the party requesting the Confidential
Information, and any and all costs connected with that defense. This obligation to indemnify survives the
termination of this Agreement and the Parties agrees that this indemnification survives as long as the Confidential
Information is in the City's possession, which includes a minimum retention period for such documents.
iv.
v. Confidential Information may be disclosed by either Party to any nationally recognized credit rating agency (e.g.,
Moody’s Investors Service, Standard & Poor’s, or Fitch Ratings) in connection with the issuance of a credit
rating for that Party, provided that any such credit rating agency agrees in writing to maintain the confidentiality
of such Confidential Information.
c. Miscellaneous. All Confidential Information remains the property of the disclosing Party and will be returned to the
disclosing Party or destroyed (at the receiving Party’s option) after the receiving Party’s need for it has expired or
upon the request of the disclosing Party.
d.
19. General Provisions.
a. Definitions and Interpretation. Unless otherwise defined or required by the context in which any term appears: (i)
the singular includes the plural and vice versa, (ii) the words “herein,” “hereof” and “hereunder” refer to this
Agreement as a whole and not to any particular section or subsection of this Agreement, (iii) references to any
agreement, document or instrument mean such agreement, document or instrument as amended, restated, modified,
supplemented or replaced from time to time, and (iv) the words “include,” “includes” and “including” mean include,
includes and including “without limitation.” The captions or headings in this Agreement are strictly for convenience
and will not be considered in interpreting this Agreement. As used in this Agreement, “dollar” and the “$” sign refer
to United States dollars.
b. Choice of Law; Dispute Resolution. This Agreement and the rights and duties of the Parties hereunder shall be
governed by and construed, enforced and performed in accordance with the laws of the State of California, without
regard to principles of conflict of laws. In the event of a dispute, controversy, or claim arising out of or relating to this
Agreement, the Parties shall confer and attempt to resolve such matter informally. If such dispute or claim cannot be
resolved in this matter, then the dispute or claim shall be referred first to executive officers of the Parties for their
review and resolution. If the dispute or claim still cannot be resolved by such officers, then any dispute arising out of
this Agreement shall be venued either in the San Mateo County Superior Court or in the United States District Court
for the Northern District of California. The prevailing Party in any dispute arising out of this Agreement is entitled to
reasonable attorneys’ fees and costs.
c. Notices. All notices under this Agreement shall be in writing and delivered by hand, electronic mail, overnight courier,
or regular, certified, or registered mail, return receipt requested, and will be deemed received upon personal delivery,
acknowledgment of receipt of electronic transmission, the promised delivery date after deposit with overnight courier,
or five (5) days after deposit in the mail. Notices must be sent to the person identified in this Agreement at the addresses
set forth in this Agreement or such other address as either Party may specify in writing.
d. Survival. Section 6 of Exhibit 1, and Sections 3, 4, 5(c), 11, 12(c), 14, 15, 17, 18 and 19 of this Exhibit 3 shall survive
termination of this Agreement.
e. Further Assurances. Each Party shall provide such information, execute and deliver any instruments and documents
and to take such other actions as may be reasonably requested by the other Party to give full effect to this Agreement
and to carry out the intent of this Agreement.
Deleted: 6250
Deleted: , to the extent permissible,
Deleted: and shall take all reasonably necessary and
customary steps to protect Confidential Information
that is the subject of any California Public Records
Act request submitted by a third person to Purchaser,
including, but not limited to, applicable exceptions
described by Cal. Gov’t Code Sections 6254 and
6255
Commented [LC32]: The City's agreement to this part is
contingent upon "confidential information" being defined
above.
Deleted: A Party may be required to make portions of
this Agreement available to the public in connection
with the process of seeking approval from its
respective governing board of its entry into this
Agreement. Such Party shall provide prior, written
approval of the other Party prior to such disclosure,
and shall provide such other Party the opportunity to
review any redacted version of this Agreement to be
so disclosed.
Deleted: Each Party acknowledges that the disclosing
Party would be irreparably injured by a breach of this
Section 18 by the receiving Party or its Representatives
or other person to whom the receiving Party discloses
Confidential Information of the disclosing Party and
that the disclosing Party may be entitled to equitable
relief, including injunctive relief and specific
performance, for breaches of this Section 18. To the
fullest extent permitted by applicable law, such
remedies shall not be deemed to be the exclusive
remedies for a breach of this Section 18, but will be in
addition to all other remedies available at law or in
equity. The obligation of confidentiality will survive
termination of this Agreement for a period of two (2)
years.
Deleted: Goodwill and Publicity. Neither Party may
(A) make any press release or public announcement of
the specific terms of this Agreement or the use of solar
or renewable energy involving this Agreement (except
for filings or other statements or releases as may be
required by applicable law), or (B) use any name, trade
name, service mark or trademark of the other Party in
any promotional or advertising material without the
prior written consent of the other Party which consent
shall not be unreasonably withheld. The Parties shall
coordinate and cooperate with each other when making
public announcements regarding this Agreement, the
System and its use, and each Party may promptly, and
in any case within 14 days, review, comment upon and
approve any publicity materials, press releases or other
public statements before they are made.
Notwithstanding the above, Seller is entitled to publish
the name of Purchaser, System location, System size
without obtaining the prior, written consent of
Purchaser and to place signage on the Premises
reflecting its association with the System.
Exh. 3, p. 16
f. Waivers. No provision or right or entitlement under this Agreement may be waived or varied except in writing signed
by the Party to be bound. No waiver of any of the provisions of this Agreement will constitute a waiver of any other
provision, nor will such waiver constitute a continuing waiver unless otherwise expressly provided.
g. Non-Dedication of Facilities. Nothing in this Agreement may be construed as the dedication by either Party of its
facilities or equipment to the public or any part thereof. Neither Party may knowingly take any action that would
subject the other Party, or other Party’s facilities or equipment, to the jurisdiction of any Governmental Authority as
a public utility or similar entity. Neither Party may assert in any proceeding before a court or regulatory body that the
other Party is a public utility by virtue of such other Party’s performance under this Agreement. If Seller is reasonably
likely to become subject to regulation as a public utility, then the Parties shall use reasonable efforts to restructure
their relationship under this Agreement in a manner that preserves their relative economic interests while ensuring that
Seller does not become subject to any such regulation. If the Parties are unable to agree upon such restructuring, either
Party may terminate this Agreement without further liability under this Agreement except with respect to liabilities
accrued prior to the date of termination and remove the System in accordance with Section 9.
h. Service Contract. The Parties intend this Agreement to be a “service contract” within the meaning of Section
7701(e)(3) of the Code. Purchaser shall not take the position on any tax return or in any other filings suggesting that
it is anything other than a purchase of electricity from the System.
i. No Partnership. No provision of this Agreement may be construed or represented as creating a partnership, trust,
joint venture, fiduciary or any similar relationship between the Parties. No Party is authorized to act on behalf of the
other Party, and neither may be considered the agent of the other.
j. Entire Agreement, Modification, Invalidity, Captions. This Agreement constitutes the entire agreement of the
Parties regarding its subject matter and supersedes all prior proposals, agreements, or other communications between
the Parties, oral or written. This Agreement may be modified only by a writing signed by both Parties.
k. Severability. If any provision of this Agreement is held by a court of competent jurisdiction to be in conflict with
any statute, constitutional provision, regulation or other rule of law, or is otherwise held by such court to be
unenforceable for any reason whatsoever, such provision shall not be read to render and shall not have the effect of
rendering this Agreement or the other provisions herein unenforceable, inoperative or invalid to any extent whatsoever.
In such event, such provision shall be deemed severable from the remaining provisions of this Agreement and such
invalidity, illegality or unenforceability shall not affect any other provision of this Agreement, and this Agreement
shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein.
l. No Third-Party Beneficiaries. Except as otherwise expressly provided herein, this Agreement and all rights
hereunder are intended for the sole benefit of the Parties hereto, and the Financing Parties to the extent provided herein
or in any other agreement between a Financing Party and Seller or Purchaser, and do not imply or create any rights
on the part of, or obligations to, any other Person.
m. Counterparts. This Agreement may be executed in any number of separate counterparts and each counterpart will be
considered an original and together comprise the same Agreement.
n. Electronic Signatures. Electronic signatures may be used in place of original signatures on this Agreement. Each
Party intends to be bound by the signatures on the electronic document, is aware that the other Party will rely on the
electronic signatures, and hereby waives any defenses to the enforcement of the terms of this Agreement based on the
use of an electronic signature. After both Parties agree to the use of electronic signatures, both Parties must sign the
document electronically.
o. No Recourse to Members of Seller. Seller is organized as a Joint Powers Authority in accordance with the Joint
Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.) pursuant to its Joint Powers
Agreement and is a public entity separate from its constituent members. Seller shall solely be responsible for all debts,
obligations and liabilities accruing and arising out of this Agreement. Purchaser shall have no rights and shall not
make any claims, take any actions or assert any remedies against any of Seller’s constituent members, or the
employees, directors, officers, consultants or advisors of Seller or of its constituent members, in connection with this
Agreement.
End of Exhibit 3
Deleted: Seller
Deleted: If the Parties agree, e
Commented [LC33]: City- confirm this is accurate for
PCE?
Commented [VP34R33]: PCE to confirm.
Exh. 4, p. 1
Exhibit 4
Performance Guaranty
In consideration for Purchaser’s entering into the Solar Power Purchase Agreement between Peninsula Clean Energy Authority
(“Seller”) and the [Purchaser] related to the System at the Premises (the “PPA”), this Performance Guaranty (this “Guaranty”) is
entered into by the parties listed below (each a “Party” and collectively the “Parties”) as of the date signed by Guarantor below (the
“Effective Date”).
Purchaser: Guarantor:
Name and Address Name and
Address
Phone Phone
E-mail E-mail
Project Name
This Guaranty sets forth the terms and conditions of a guaranty provided by Guarantor in conjunction with the PPA. Capitalized terms
not otherwise defined herein have the meanings given such terms in the PPA. The term of this Guaranty will be concurrent with the term
of the PPA; except that it will not exceed the Initial Term. This Guaranty will be updated by Guarantor to reflect the as-built
specifications of the System.
1. Guaranty. Guarantor guarantees that during the term of the PPA the System will generate not less than [_____] percent ([__]%)
of the estimated generation of the System based on PVSyst (“Estimated PVSyst Production (Annual kWh)”) as set forth in
Table 1.A below (such guaranteed generation, the “Guaranteed Production (Annual kWh)” set forth on Table 1.A below);
provided that the Guaranteed Production values are subject to reasonable downward adjustment for extreme weather conditions.
A. Guarantor will use local weather data to adjust the System’s Guaranteed kWh, based on the following
methods if available and in descending order of preference: (i) satellite data provided by a third-party vendor of Seller; or
(ii) available data from a locally installed weather station at the Premises owned and properly maintained by Purchaser.
Table 1.A, projected production values assuming average weather conditions:
Contract
Year
Estimated PVSyst
Production (Annual
kWh)
Guaranteed
Production (Annual
kWh)
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Year 12
Year 13
Year 14
Year 15
Year 16
Commented [LC35]: City- confirm these performance
standards are acceptable. 5
Commented [VP36R35]: Data to be discussed and agreed
upon before executing PPA.
Exh. 4, p. 2
Year 17
Year 18
Year 19
Year 20
B. If at the end of each successive Contract Year the AC electricity produced by the System as measured and
recorded by Seller (the “Actual kWh”) is less than the Guaranteed kWh for that Contract Year, then Guarantor shall pay
Purchaser an amount equal to (i) the difference between the Guaranteed kWh and the Actual kWh, multiplied by (ii) the
Performance Guarantee Payment Rate (as defined in Section 1(E)), in each case with respect to the affected Contract Year.
C. If at the end of each successive Contract Year the AC electricity produced by the System as measured and
recorded by Seller (the “Actual kWh”) is more than the Guaranteed kWh for that Contract Year, then an amount equal to (i)
the difference between the Actual kWh Guaranteed kWh and the Guaranteed kWh, multiplied by (ii) the Performance Guarantee
Payment Rate, in each case with respect to the affected Contract Year, shall be credited against and shall reduce by such amount
any payments owed by Guarantor to Purchaser in the following Contract Year pursuant to Section 1(B) of this Exhibit 4. The
amount under Section 1(C)(i) above shall be capped at one hundred and five percent (105%) of the Guaranteed kWh for the
applicable Contract Year.
D. If a payment of greater than fifty dollars ($50) is due under Section 1(B), after subtracting any credits pursuant
to Section 1(C), (i) Guarantor will deliver a statement to Purchaser detailing the Guaranteed kWh and the calculation of the
payment due; and (ii) the payment shall be due within ninety (90) days after the end of the Contract Year. If no payment is due,
then no statement or payment will be issued.
E. “Performance Guarantee Payment Rate” means the Contract Price.
2. Exclusions. The Guaranty set forth in Section 1 does not apply to the extent of any reduced generation from the System due to
the following (including the downtime required for repair, replacement or correction):
A. a Force Majeure Event, which includes (i) destruction or damage to the System or its ability to safely produce
electricity not caused by Seller or its approved service providers while servicing the System (e.g., vandalism); (ii) a power or
voltage surge caused by someone other than Seller, including a grid supply voltage outside of the standard range specified by
the Utility; and (iii) theft of the System; and (iv) curtailment or reduction of energy production required by the Utility or grid
operator.
B. Purchaser’s failure to perform, or breach of, Purchaser’s obligations under the PPA.
3. Liquidated Damages; Waiver of Cost Savings. The Parties agree that the payment described in Section 1(B) is a reasonable
approximation of the damages suffered by Purchaser as a result of underperformance of the System, is bargained-for by the Parties, and
shall be the Purchaser’s sole and exclusive remedy hereunder for underperformance of the System. Purchaser hereby disclaims, and any
beneficiary of this Guaranty hereby waives, any warranty with respect to any cost savings from using the System.
4. Incorporation of PPA Provisions. Section 5(c) (Force Majeure), Section 17 (Assignment and Financing) and Section 19
(General Provisions) of Exhibit 3 of the PPA and any Sections referenced therein are incorporated into this Guaranty as if any reference
therein to “Agreement” were to this Guaranty and any reference to “Parties” were to the Parties to this Guaranty.
Guarantor:
Signature:
Purchaser:
Signature:
Printed Name: Printed Name:
Title: Title:
Date: Date: