RFP 20_1868 Utility Scale Solar Schedule D - Example Surface Use Lease.pdf

PR4310-2 (Rev. 03/30/2009)

EXAMPLE SOLAR SURFACE FACILITY

SURFACE USE LEASE

MICHIGAN DEPARTMENT OF NATURAL RESOURCES

FOREST RESOURCES DIVISION

By authority of Part 5, Act 451 of 1994, as amended.

L-XXXXX

Company Name

This lease made and entered into this day of in the year ;

By and between the DIRECTOR OF THE DEPARTMENT OF NATURAL RESOURCES (Lessor) for the STATE OF MICHIGAN, hereafter called "Lessor", whose address is P. O. Box 30452, Lansing, Michigan 48909-7952 and COMPANY NAME, a STATE corporation, whose address is ADDRESS, CITY, STATE ZIP CODE, hereafter called "Lessee".

Whereas, pursuant to Section 503(1) Part 5 of the Natural Resource and Environmental Protection Act, 1994 PA 451 (NREPA), as amended, MCL 324.503(1), the Lessor is required to: protect and conserve the natural resources of the state; provide and develop facilities for outdoor recreation; prevent the destruction of timber and other forest growth by fire or otherwise; promote the reforesting of forest lands belonging to the state;

prevent and guard against the pollution of lakes and streams within the state and enforce all laws provided for that purpose with all authority granted by law; and foster and encourage the protecting and propagation of game and fish.

WHEREAS, the Purpose of this Lease is to allow Lessee to enter the Premises to install, construct, maintain, alter, repair, replace, reconstruct, operate and remove a ground mounted utility-scale solar energy development. The Lessor is allowed to lease lands for such purpose as authorized under Section 503(2) of the

NREPA, MCL 324.503(2).

WHEREAS, the Director of the DNR, or his or her lawful designated Representative, has determined that the purpose of this Lease is necessary to implement Part 5 of 1994 PA 451, as amended, because the generation of renewable energy from sources such as solar power on the Premises will protect and conserve the natural resources and promote Michigan’s progress in converting from non-renewable to renewable energy to implement environmental sustainability.

Therefore, Lessor and Lessee, for the valuable consideration specified in this lease, agree to the following terms and conditions with respect to the following described premises (the “Premises”):

*********** COUNTY

********** Township

T**N, R**W

Premises Description Sections

SURVEY DESCRIPTION OF PREMISES ** & **

Stipulations and Conditions

1. DESCRIPTION OF PREMISES:

Lessor hereby leases to Lessee the Premises, as described on page one and as shown on the attached

Survey of Premises, Exhibit A, hereinafter Survey located in ** Township, ** County.

This lease may be amended upon mutual written agreement between Lessor and Lessee to add additional pipeline related surface facilities and equipment operated by the Lessee on state surface.

2. TITLE:

Lessee acknowledges that (a) Lessor makes no warranty of title with respect to the Premises; (b) Lessee has had the opportunity to make its own assessment to such title; and (c) Lessee waives any claim against Lessor for inadequate or defective title to the Premises.

3. LEASE ADMINISTRATION AND REPRESENTATIVES:

Lessor’s Unit Manager, NAME (or successor), XXXXXXX Management Unit, ADDRESS, CITY, MI ZIP

CODE, PHONE NUMBER, or EMAIL@michigan.gov is the Lease Administrator (Lessor’s Representative) as pertains to the terms and conditions of the lease as well as compliance with the terms and conditions of the lease.

Lessee designates NAME, ADDRESS, CITY, STATE, ZIP CODE, PHONE NUMBER, or

ADDRESS@ADDRESS.COM (or successor) as the Lessee’s Representative who is the contact person responsible for Lessee regarding the administration of the lease. This person shall be authorized to make decisions regarding the maintenance and operation of the Premises.

4. USE OF PREMISES:

A. Lessee hereby acknowledges that the use and occupancy of the Premises shall be subject to the provisions of the NREPA, and confined to the following specific uses:

1. To access, construct, operate, protect and maintain utility-scale solar photovoltaic (PV) systems, fence and appurtenances thereto (the Additional Facilities”) on XXX.XX acres of land, as shown on the attached Survey, Exhibit A, as approved by the Lessor’s Representative.

2. To construct and maintain fencing around the Premises.

3. To use the Lessor approved access drive. The use of the road is non-exclusive.

4. To restore the Premises and surface to the specifications set forth in Paragraph 14.

Lessee shall obtain Lessor’s prior consent, in writing signed by the Lessor’s Representative, to use the Premises for any purpose not listed above in A. 1 through 3. Lessor may terminate this lease if, at any time, Lessee uses the Premises, without express written permission by Lessor, for purposes other than those enumerated in A. 1 through 3. The following activities are specifically prohibited:

mailto:EMAIL@michigan.gov mailto:ADDRESS@ADDRESS.COM

B. PROHIBITED ACTIVITIES:

1. Blockage of the access road unless limited blockage is approved in writing by the Lessor’s Representative. The Grantee may close forest roads and recreational trail crossings in emergency situations for up to 24 hours without approval of the Department’s Representative. Emergency closures of more than 24 hours require the written approval of the Department’s Representative.

2. Any clearing activity outside the Premises.

3. Dumping or disposal of garbage/trash, spare parts, scrap metal, and other waste onto the

Premises.

4. Disposal of trees, treetops, branches, roots, stumps, and other vegetational debris onto the

Premises.

5. Placement of pipelines, unless further authorized by separate easement from Lessor.

Lessor may terminate this lease if, at any time during the term of this lease, prohibited activities occur on the Premises. This paragraph is cross-referenced in paragraph 24.

5. WASTE:

Lessee agrees not to commit, or allow to be committed, waste (as defined in Part 615 of the NREPA, MCL 324.61501 et seq.) or nuisance on the Premises and will not use, or permit to be used, the Premises for an unlawful purpose. Lessee is responsible for all costs and expenses that may be payable or incurred in the use of the Premises in compliance with this lease.

6. LESSOR’S OPERATIONS:

Lessee covenants that its use of the Premises shall, at no time, interfere with the operations of Lessor or its use, or the public’s use of state land adjacent to the Premises subject to Paragraph 25.

7. CONDITION OF PREMISES:

Lessee stipulates, represents, and warrants that Lessee has examined the Premises, and that they are at the time of this lease in good order, repair, and in a safe, clean, and tenantable condition. Lessee represents that it is taking possession of the Premises in their “as is” condition. Lessee can make an independent environmental assessment of the Premises. If an assessment is made, a copy of the environmental assessment shall be provided to the Lessor’s Representative upon or by lease inception.

Lessee agrees to maintain the Premises in good order, repair, and in a safe and clean condition throughout the life of the lease.

8. TERM:

Lessor shall lease the Premises to Lessee for a twenty five (25) year initial term of possession beginning upon actual possession at 12:01 a.m. on __________________, and ending at midnight on ________________, or such later date as provided in Paragraph 9 “OPTION TO RENEW”. The beginning and ending lease term dates may be altered by mutual written consent to reflect the actual date of occupancy. If the occupancy date is changed, Paragraph 9 “OPTION TO RENEW” shall also be changed accordingly.

9. OPTION TO RENEW:

The initial term of this lease may be extended in increments up to 5 years [maximum 40 years] if Lessee gives Lessor 120-days written notice before this lease or any extension expires and agrees to any additional terms and conditions and rent modifications proposed by Lessor in writing. Lessor’s written consent is necessary for any lease term extension.

10. RENT/USE FEE:

Lessee shall pay the sum of $XX,XXX per annum for the use of the Premises. Payment shall be sent to the address indicated under Section 29.

Checks should be made payable to the State of Michigan. Payment is due within 5 days of each and every anniversary date of this lease during the Term hereof or any renewal. A $50 per day Late Fee must be paid to Lessor by Lessee for every day beyond the designated due date that payment is made. Failure to pay rent will be grounds for the Department to terminate the Lease.

11. SERVICES BY LESSEE:

Lessee shall furnish the following services at its own expense:

a. Lessee will secure, maintain, and keep the Premises in good repair.

b. Lessee will pay for all public utilities used including electric service and telecommunications service.

Such utility service may require separate easement approval by the Lessor.

c. Lessee is responsible for snow removal on the Premises as well as maintenance of the designated access road.

d. Lessee shall, dispose of all garbage, waste, and debris from the buildings and grounds within the

Premises. Lessee shall at all times keep the Premises in a clean and sanitary condition and in conformity with standards and rules for sanitation and public health.

Lessee shall maintain standards of cleanliness that will reflect favorable public opinion on the Lessee and the Department. If the Lessor’s Representative determines that Lessee has failed to maintain an acceptable standard of cleanliness and if after 48 hours, consisting of two working days, following verbal and written notification by Lessor, the problem is not rectified to the satisfaction of Lessor, Lessor may perform or have the duties of Lessee performed by others. Lessee shall pay 120 percent of the cost of such work, whether performed by the Lessor or by others at the discretion of Lessor. Situations caused by emergencies that deter Lessee from immediate (48 hours) correction shall be reported to the Lessor’s Representative and appropriate regulatory agencies and shall be excluded from notice and cure provisions of this clause.

12. ASSIGNMENT:

Lessee may not assign this lease without Lessor’s prior written consent, which consent shall not be unreasonably withheld, delayed, or denied. Lessee shall request Lessor’s prior written consent at least 45 days in advance of such an assignment. With Lessor’s prior written consent, an assignment shall be effective to transfer the following: (1) Lessee’s rights under the lease; (2) Lessee’s obligations under the lease only insofar as such obligations relate to use of the Premises after the effective date of assignment;

and (3) any risk of loss associated with use of the Premises after the effective date of assignment. The request for Lessor’s consent shall include the assignee’s bond, and proof of insurance, as determined by Lessor. An assignment granted without the written consent required by this paragraph shall be null and void.

13. SITE PLAN:

Lessee shall provide to the Lessor’s Representative a detailed Site Plan, Exhibit C showing any proposed improvements at least 30 days prior to the expected installation date.

14. COMPLETION/ABANDONMENT:

Within 180 days of the lease term expiration, completion of permitted use, abandonment by Lessee, or lease cancellation, Lessee shall submit an abandonment and site restoration plan to the Lessor’s

Representative for review and approval. Lessee shall remove all installations on the Premises. This shall include removal and proper disposal of all waste, contaminated soils, groundwater or other materials, buildings, utilities, or equipment unless authorized in writing by the Lessor’s Representative. All rights and obligations under this easement shall terminate upon the Lessor’s Representative providing written confirmation to the Lessee that the requirements of the abandonment and site restoration plan have been completed to their satisfaction.

Lessee shall notify the Lessor’s Representative in writing within thirty (30) days of cessation of approved use (abandonment).

15. LAWS, CODES AND PERMITS:

All applicable laws and rules are made a part and condition of this lease. Violations of any of the applicable laws shall be considered a violation of the terms and conditions of this lease and Lessor, at its sole discretion, may invoke all or any combination thereof. No rules made after the approval of this lease shall operate to affect the term of the lease or rental rate, unless agreed to by both Lessor and Lessee.

16. DAMAGE AND REPAIRS:

Lessee shall reimburse Lessor for any repairs or remediation work on the Premises resulting from damage to the Premises caused by Lessee including, but not limited to, damages to the environment or natural resources as defined in Section 20101 (1) (k) of the NREPA, MCL 324.20101 (k).

17. INSPECTION OF PREMISES:

Lessor and Lessor’s agents and employees shall have the right at all reasonable times, with reasonable notice during the term of this lease, and any renewal thereof, to enter the Premises for the purposes of making any inspections and repairs, as may be deemed appropriate by Lessor for the preservation of the Premises.

18. INDEMNIFICATION:

1. Unless resulting from the sole negligence of the Lessor, the Lessee hereby releases, waives, discharges and covenants not to sue the State of Michigan, its departments, officers, employees and agents, from any and all liability to Lessee, its officers, employees and agents, for all losses, injury, death or damage, and any claims or demands thereto, on account of injury to person or property, or resulting in death of Lessee, its officers, employees or agents, in reference to the activities authorized by this lease.

2. Lessee hereby covenants and agrees to indemnify and save harmless the State of Michigan, its departments, officers, employees and agents, from any and all claims and demands, for all loss, injury, death or damage, that any person or entity may have or make, in any manner, arising out of any occurrence related to (1) issuance of this lease; (2) the activities authorized by this lease; and (3) the use or occupancy of the premises which are the subject of this lease by the Lessee, its employees, contractors, or its authorized representatives.

19. INSURANCE:

Lessee shall provide to Lessor certificates of insurance listing the State of Michigan, its several departments, boards, agencies, commissions, officers, and employees as additional insured’s, within 30-calendar days following the execution and delivery of this lease to Lessee, and every year thereafter, for the following insurance coverage. The insurance policies cannot be modified, canceled, or allowed to expire without 30 days prior written notice given to Lessor.

a. Lessee shall obtain general liability insurance, naming Lessor, its officers and employees as additional insured’s and protecting against claims, demands, suits, actions, or causes of action or judgments, settlements, or recoveries, for bodily injury or property damage arising out of a condition of the Premises, or arising in connection with or as a direct or indirect result of the Lessee's use and occupancy of the Premises or its exercise of the right and privileges granted in the lease. Lessee agrees to maintain a policy limit, in the amount of $2,000,000.00 per occurrence for property damage, $2,000,000.00 per occurrence for bodily injury, and $4,000,000.00 aggregate.

b. Lessee shall obtain workers compensation insurance, or be an approved self-insurer for Lessee employers’ claims under Michigan Workers Compensation Act or similar employee benefit act or any other state act applicable to an employee, along with Employer’s Liability Insurance for claims for damages because of bodily injury, occupational sickness or disease or death of an employee when workers compensation may not be an exclusive remedy, subject to a limit of liability of not less than $100,000 each accident.

c. Lessee shall maintain automobile no-fault coverage as required by law, or be an approved self-insurer.

d. Lessee shall maintain pollution liability insurance covering pollution incidents that result in bodily injury or property damage, subject to a limit of liability of not less than $1,000,000.00.

20. ACCIDENTS OR PROPERTY DAMAGE:

Lessee shall report, in writing, to the Lessor’s Representative, all accidents that result in personal injury or damage to the Premises or adjacent land. Lessee shall make complete reports in writing to Lessor’s Representative within 24 hours of any such incident. Incidents resulting in serious personal injury, death, or damage to the Premises or adjacent land are to be reported to Lessor’s Representative immediately by telephone or in person. A written report is to follow as described above. Lessee shall also provide to the Lessor, all reports regarding damage to the Premises or adjacent land required under Part 615 of Public Act 451of 1994, as amended, MCL 324.61501 et seq. and Administrative Rules R324.101 et seq.

21. PERFORMANCE BOND:

As a guarantee of faithful performance of the conditions of this lease, Lessee delivers herewith a cash or surety bond or letter of credit in the sum of $50,000.00. As soon as security for the performance of the terms of this lease or the settlement of claims incident thereto is no longer necessary, deposits in lieu of surety or cash bond will be subject to the conditions set forth in the sentence immediately following, and returned to Lessee. Lessee agrees that all monies deposited under this lease may, upon failure on Lessee’s part to fulfill all and singular the requirements herein set forth or made a part hereof, be retained by the State of Michigan to be applied as far as may be to the satisfaction of Lessee’s obligations assumed hereunder, without prejudice whatever to any rights and remedies of the State of Michigan.

22. NONDISCRIMINATION:

Lessee shall comply with the Elliott-Larsen Civil Rights Act, 1976 PA 453 as amended, MCL 37.2101 et seq.; MSA 3.548 (101) et seq.; the Persons with Disabilities Civil Rights Act, 1976 PA 220, as amended, MCL 37.1101; MSA 3.550 (101) et seq., and all other federal, state, and local fair employment practices and equal opportunity laws and covenants that it shall not discriminate against any employee or applicant for employment, to be employed in the performance of this lease, with respect to his or her hire, tenure, terms, conditions, or privileges of employment, or any matter directly or indirectly related to employment, because of his or her race, religion, color, national origin, age, sex, height, weight, marital status, or physical or mental disability that is unrelated to the individual's ability to perform the duties of a particular job or position. Lessee agrees to include in every subcontract entered into for the performance of this lease this covenant not to discriminate in employment. A breach of this covenant is a material breach of this lease.

23. UNFAIR LABOR PRACTICES:

Lessee shall comply with the Employers Engaging in Unfair Labor Practices Act, 1980 PA 278, as amended, MCL 423.321 et seq.; MSA 17.458(21) et seq.

24. CANCELLATION:

Lessor may cancel this lease provided Lessee is notified in writing at least 30 days prior to the effective date of cancellation and any one of the following occur:

a. Lessor determines that the Premises are no longer being used for the purposes identified in this lease.

b. Lessor determines that Lessee provided Lessor with information, in its application for this lease or at any time during the lease term, that was false or fraudulent.

c. Lessee fails to perform any of its obligations under this lease, and such failure is not cured within 30 calendar days after written notice of default to Lessee.

d. Lessee or any subcontractor, manufacturer, or supplier of Lessee appears in the register compiled by the Michigan Department of Consumer and Industry Services pursuant to 1980 PA 278, as amended, MCL 423.321 et seq.; MSA 17.458(21) et seq. (Employers Engaging in Unfair Labor Practices Act).

e. Lessee or any subcontractor, manufacturer, or supplier of Lessee is found guilty of discrimination, pursuant to 1976 PA 453, as amended, MCL 37.2101 et seq.; MSA 3.548(101) et seq. (Elliott-Larsen Civil Rights Act); or 1976 PA 220, as amended, MCL 37.1101 et seq.; MSA 3.550(101) et seq.

(Persons with Disabilities Civil Rights Act).

25. LESSEE RIGHTS:

Upon payment of the fees and the performance of the conditions outlined herein, Lessee may use the

Premises as provided in Paragraph 4, provided that the use of the Premises by Lessee shall at no time unreasonably interfere with the operations or use of the Lessor or the public on the state lands adjoining the Premises.

26. RESERVATION:

Lessor reserves the right to grant rights-of-way and easements of any kind and nature over and across the

Premises and to grant or exercise all other rights and privileges of every kind and nature not herein specifically granted so long as granting of such rights does not interfere with Lessee’s use of the Premises as described in Paragraph 4.

27. HOLDOVER TENANCY:

If Lessee remains in possession of the Premises after the natural expiration of this lease, with the written consent of Lessor obtained 30 days prior to the expiration of the lease term, but without a renewal of this lease pursuant to Paragraph 9, a new tenancy from month-to-month shall be created between Lessor and Lessee. The new tenancy shall be subject to all of the terms and conditions of this lease, except that rent shall then be due and owing at the rate of $1,000.00 per month and except that such tenancy shall be terminable upon 30 days written notice served by either party.

28. TAXES:

If Lessee is a nongovernmental entity, it may be subject to taxation for the Premises as provided in 1953

P.A. 189, as amended, MCL 211.181 et seq.; MSA 7.7(5) et seq.

Lessee’s failure to notify the taxing authority of this lease or its failure to pay its pro rata share of real property taxes by the first due date shall be a breach of the lease. Lessee shall, upon request, provide Lessor with paid receipts for any real property taxes.

NOTICE AND APPROVALS

29. NOTICES:

Any notices to Lessor or to Lessee required by this lease shall be complete if submitted in writing and transmitted by personal delivery (with signed delivery receipt), or certified or registered mail return receipt requested. Unless either party notifies the other in writing of a different mailing address, notices to Lessor and Lessee shall be transmitted to the addresses listed below:

To Lessor: With copy to Lessor’s Representative:

State of Michigan NAME, Unit Manager Department of Natural Resources XXXXXX Management Unit Forest Resources Division ADDRESS P.O. Box 30452 CITY, STATE ZIP CODE Lansing, Michigan 48909-7952 To Lessee:

CONTACT NAME

COMPANY

ADDRESS

CITY, STATE ZIP CODE

30. NOTICE EFFECTIVE TIME/DATE:

Notices shall be deemed effective as of 12:00 Noon Eastern Standard Time on the third business day following the date of mailing, if sent by mail. Business day is defined as any day other than a Saturday, Sunday, legal holiday, or day preceding a legal holiday. A receipt from a U.S. Postal Service, or comparable agency performing such function, shall be conclusive evidence of the date of mailing.

31. INTERPRETATION:

This lease shall be interpreted in accordance with the laws of the State of Michigan.

32. NO UNNAMED PARTNERS:

Lessee covenants that there are no unnamed partners having authority over the operation or management of the Premises and further represents that Lessee is the only entity responsible for carrying out Lessee’s responsibilities.

33. LESSEE’S INDEPENDENT STATUS:

Lessee covenants that its officers, employees, or agents, are not employees of the State of Michigan.

Lessor and Lessee agree that the Lessee shall have a leasehold interest only on the Premises and that Lessee will have no title lien or any reversionary interest in the Premises or in any property belonging to Lessor surrounding or adjacent to the Premises.

34. CONTRACTS:

Lessee may execute contracts or agreements as the operator of the business authorized under the terms of this lease. The contracts or agreements must not obligate Lessor or conflict with the terms of the lease.

Lessee shall indemnify, defend, and exculpate Lessor from any liability that may accrue or be asserted against the Department or the State of Michigan under such contracts or agreements.

35. REQUIRED APPROVALS:

This lease shall not be binding or effective on either party until executed (and witnessed and notarized as necessary) by Lessor and Lessee.

36. SEVERABLITY:

Should any provision of this lease or any addenda thereto be found to be illegal or otherwise unenforceable by a court of law, such provision shall be severed from the remainder of the lease, and such action shall not affect the enforceability of the remaining provisions of the lease.

37. NON-ENFORCEMENT:

The decision of Lessor not to enforce, in any one or more instances, the performance of any term of this lease may not be construed as a waiver or relinquishment of Lessor’s right to the future performance of the term. Lessee’s obligations to comply with all terms of the lease remain in full force and effect.

38. ENTIRE AGREEMENT AND EXHIBITS:

This lease, with the Exhibits listed below, constitutes the entire agreement between Lessor and Lessee with regard to this transaction, and may be amended only in writing and executed in the same manner as this lease was originally executed.

Exhibit A – Survey of Premises Exhibit B – Site Plan

The said Lessor, by its ACTING CHIEF of Forest Resources Division, has signed and affixed the seal of the State of

Michigan by virtue of action taken by Lessor on ___________________, 20_____, and Lessee has signed and affixed its seal the day and year written below.

ACKNOWLEDGEMENT BY LESSOR

Printed Name, Title: Jeff Stampfly, Acting Chief Agency Name: Forest Resources Division

Department of Natural Resources State of Michigan

Signature: _________________________________________

The foregoing instrument was acknowledged before me this _ day of , 20____, by Jeff Stampfly, Acting Chief, Forest Resources Division.

Prepared by: Matt Fry ____________________________________, Forest Resources Division Karen Maidlow, Notary Public Department of Natural Resources State of Michigan, Ingham County P.O. Box 30452 Acting in Ingham County, Lansing, Michigan Lansing, Michigan 48909-7952 My Commission Expires: July 1, 2025

ACKNOWLEDGEMENT BY LESSEE

Printed Name, Title:

Agency Name:

Signature: _________________________________________

The foregoing instrument was acknowledged before me this ________ day of _______________, 20____, by

__________________________________ Notary Public

State of Michigan, ________________________ County

Acting in ________________________________ County

My Commission Expires: _________________________

SITE PLAN OF DEVELOPMENT-EXHIBIT B

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P / N

STATE

WELL

P / N

STATE

CABIN S05"E 1056'

WETLAND SE 925'

22" OAK

APPROXIMATE E - W 1 / 4 LINE

OPEN LEVEL LAND IN THE

EX!STiNG C.P.f'. SITE I

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