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Lease Summary for the proposed power plant project

ByFree Press Staff Reading Time: 3 minutes

CITY OF JASPER    

JASPER CLEAN ENERGY CENTER

July 21, 2011

 

 

TOPIC

 

EXPLANATION

 

REFERENCE

 
Landlord: The City of Jasper

Preamble

 
Tenant: Jasper Clean Energy, LLC

Preamble

 
Premises: 1163 E. 15th Street, Jasper, Indiana (approximately 6.5 acres)

Preamble

Exhibit 1

 
Term of  Phase I:(Interim Period) Effective Date to Commencement Date(12 to 18 months)

Preamble

 
Term of  Phase II:(Construction Period) Commencement Date to Commercial Operation Date(18-24 months)

Preamble

 
Term of Phase III:(Operational Period) Commercial Operation Date to End of Lease(20 years + option)

Preamble

 
Term of Phase IV:(End of Lease) Decision for Use of Facility
  • Option of City to purchase entire Facility
  • Return of Facility to City as Biomass-only Operation
  • Decommissioning of Facility / Site

 

Preamble

 
Initial Lease Term: 20 years from Commercial Operation Date

p. 2

 
Construction Term: 18-24 months

p. 2

 
Renewal Options Two 5-year Renewal Terms

p. 2

 
Rent:
  • Interim Option Payment – $60,000 Quarterly [Paid during                                    Phase I].

 

  • Annual Rent

o        $425,000 [Paid during Phases II and III]

o        Inflation increases for Annual Rent (100% of Implicit Price Deflator).

 

  • Royalty

o        $1.5 per MWh [Paid during Phase III]

o        Inflation increases for Royalty (100% of Implicit Price Deflator).

o        Based on production of electricity by Modified Boiler)

 

p. 4

 
Blackout Event:
  • If City and Project are cut off from Grid, Jasper Clean Energy Facility will help facilitate supply of electricity to City.
  • If connected to Grid, Jasper Clean Energy Facility able to start other power plants.

p. 46

 
Repairs & Maintenance:

p. 40

 
Utilities:

Article XXII

 
Insurance:

Article X

Exhibit 20

 
Property Taxes:

Article XXIII

 
Improvements:

Article IX

Exh. 5 / Exh. 11

 
Conditions Precedent:(applicable during Phase I)
  • Lessee’s right to terminate – Conditions Precedent:
  • Lessor’s right to terminate – Conditions Precedent:

o        Inability to obtain environmental permits.

o        Inability to obtain interconnection agreement to Grid

o        Inability to obtain power sales agreement.

o        Inability to obtain construction funding.

o        Inability to obtain natural gas pipeline agreement.

o        Inability to obtain government approvals.

o        Inability to obtain 69KV service line agreement.

o        Inability to obtain tax abatement.

 

o        If Conditions Precedent above not met by September 2012 (Commencement Date)

o        Subject to Lessee’s right to demonstrate substantial effort to comply with and progress towards satisfaction of any of those Conditions Precedent

p. 15

 
Fuel Limitations:
  • Primary Fuels – Natural Gas / Miscanthus
  • Emergency Backup Fuel – Diesel
  • Able to use improved or modified forms of Miscanthus, so long as non-invasive, etc.
  • Able to use of other “closed-loop biomass crop” with consent of City, so long as non-invasive, etc.

Article V

p. 45

 
Commit to Miscanthus:
  • May 1, 2013   –  (25% of acreage – approx. 2,250 acres)                         Contracted
  • May 1,2014    –  (50% of acreage – approx. 4,500 acres))                        Contracted
  • May 1,2015    –  (25% of acreage – approx. 2,250 acres)                         Contracted

p. 38

 
Security / Liquidated Damages:
  • PHASE I      – None                                                     (interim)
  • PHASE II     – $1.5 Million LOC                       (construction)
  • PHASE III   – $3.5 Million LOC                           (operation)

$1.5 Million Sinking Fund

 

p. 20-22

p. 48-49

 
Coordination Committee:
  • Non-compensated committee to mutually resolve lease disputes

p. 33

 
Emissions:
  • Obligations to meet stricter air emission standards (Voluntary Compliance Levels)
  • Monitoring requirements (air)
  • Penalties and Required Actions
  • Sound emissions
  • Noise emissions

Exhibit 14

 
Right of First Refusal:

p. 47

 
Site Location:

Exhibit 1

 
Description of Existing Plant:

Exhibit 2

 
Description of Remaining Equipment:

Exhibit 5

 
Offer of Employment to Existing Employees:

Exhibit 7

 
Qualifications of Facility Manager:

Exhibit 15

 
Construction Control Qualifications:

Exhibit 16

 
Sustainability / Fire Protection:

Exhibit 17

 
Access to and Right of Inspection:

p. 18

 

 

 

 

 

 

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