Bellingham Waterfront District Energy Infrastructure Agreement
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BELLINGHAM WATERFRONT DISTRICT ENERGY INFRASTRUCTURE AGREEMENT THIS AGREEMENT dated for reference the 7th day of December, 2020, BETWEEN: PORT OF BELUNGHAEVI, a special purpose municipal district under the laws of the State of Washington, having an address at 1801 Roeder Avenue, Bellingham WA 98225 ("Port") AND: CORIX UTILITY SYSTEMS (WASHINGTON) INC., a Deiaware private corporation, having an address at 500 West Monroe Street, Suite 3600, Chicago, !L 60661 ("Corix") WHEREAS: A. Port owns the former Georgia-Padfic West industrial site south of Roeder Avenue and east of the Whatcom Waterway that is on the Washington State Department of Ecology ("Ecology") Site Register as a Contaminated Site, Cleanup Site ID number 2279 and which includes approximately 44 acres of property designated for mixed-use development (the "Downtown Waterfront District"), as depicted in Exhibit A, Development Area Map; B. Port and the City of Beilingham have approved a Waterfront District Sub-Area Plan 2019 (as may be amended) regarding the development of the Downtown Waterfront District; C. The City of Bellingham's Municipal Code provides that all new development within the Downtown Waterfront District shall connect to and utilize district specific utilities, such as district energy; D. Port and Harcourt Beliingham LLC entered into a Master Development Agreement dated May 19, 2015 which provides Harcourt Beiiingham LLC the exclusive right to purchase and develop lots within the Development Area in the Downtown Waterfront District; E. Consistent with the City of Beliingham's Municipal Code, Port wouid like to support Corix's development of a district energy system that will provide district energy services to residential and commercial customers located in the Downtown Waterfront District; F. Port has installed a district energy piping system along Laurel Street ("Port's DPS") consisting of heating and cooling pipes and future expansion connections at key locations; G. Corix responded to Port's Request for Qualifications issued on April 6, 2018 in respect of the development of a district energy system in the Downtown Waterfront District and Port and Corix subsequently entered into a Memorandum of Understanding dated December 4, 2018, pursuant to which Corix undertook technical and economic feasibility assessments and due diligence relating to the development of a district energy utility; H. !n support of the development of the district energy utility for the Downtown Waterfront District and the Port has selected Corix as the exclusive provider of district energy services for the Development Area though such a utility; I. Port and Corix desire Corix to design, construct, finance, own, operate and maintain the required infrastructure for the district energy utility that will serve residential and commercial customers in the Development Area, all on the terms and conditions set out in this Agreement; J. Corix and Developers will enter into district energy service agreements for the provision of district energy services to buildings buiit in the Downtown Waterfront District; K. Corix requires Port's support and cooperation to ensure the Developers are aware of the requirement to connect to the district energy system and their related obligations. L The Port's intent En the Downtown Waterfront District has been to acquire, remediate, and transfer the property in the District to other parties as development occurs in order to create economic opportunities pursuant to its statutory mission. NOW THEREFORE THIS AGREEMENT WITNESSES THAT in consideration of the mutual agreements set out below and for other good and valuable consideration (the receipt and sufficiency of which are acknowledged by each Party), the Parties covenant and agree with each other as follows. 1. INTERPRETATION 1.1 Definitions In this Agreement, the following terms have the meanings set out beiow: (a) "Affiliate" means with respect to a specified entity any entity or Person directiy or indirectly, through one or more intermediaries, controlling, controlied by, or under common contro! with that specified entity; (b) "Assumption Event" has the meaning ascribed to it in Section 19.9; (c) "Building" means each permanent structure present or to be constructed by a Developer on a Current Phase Lot; (d) "Building System" means: (i) in the case of a Building, the system of water pipes, space heating and cooling, and hot water delivery and storage equipment to be installed by the Developer and used for distributing and storing Thermal Energy within the Building, connected to but downstream of and excluding the Service Connection and Energy Transfer Station for that Building; and (ii) in the case of an Existing Building, the system of water pipes and space heating and cooling and hot water delivery and storage equipment located inside the exterior face of such Existing Building; Page 2 of 35 (e) "Business Day" means any day except Saturday or Sunday; a statutory hoiiday in the state of Washington, the Province of British Columbia, or the United States of America; and any other day on which banks are generally not open for business in Bellingham, Washington; (f) "Central Energy Plant" or "CEP" means the permanent, physical, central thermal energy plant for the Current Phases, including all associated mechanicai and electrical equipment, interconnections and control systems; (g) "CEP Lot" means the lot comprising part of the Deveiopment Area on which the CEP is to be located or constructed; (h) "Changes of Law" means any enactment of or amendment to Laws affecting (i) the performance, regulation, operation, maintenance or routine repair of the infrastructure; (ii) the provision of Energy Services; and/or (iii) the creation and provision of Thermal Energy; (i) "City" means the City of Beilingham; (j) "City Lands" means lands owned or controlled by the City; (k) "Commencement Date" means the date on which Energy Services are first provided to a Customer; (I) "Connection Fee" means the monetary contribution paid by a Developer in respect of a Building, calculated as a doliar amount per square foot of the Building's total size, adjusted annually for increases in the Consumer Price Index for Whatcom County (or King County if data for Whatcom County is not available); (m) "Connection Schedule" means the then-current timetable according to which the infrastructure will be constructed and connected to each of the Buildings; (n) "Contaminant" means any radioactive materials; asbestos or asbestos containing materials; urea formaldehyde; underground or above ground tanks; pollutants, contaminants, deleterious substances, dangerous substances, goods, or waste; solid, liquid, gaseous or thermal imtants (not including Thermal Energy produced as part of this Agreement); hazardous, corrosive, or toxic substances; hazardous waste; waste; pesticides; defoliants; soot; acids; alkalis; toxic chemicats; or any other solid, liquid, gas, vapor, odor, heat, sound, vibration, radiation, or combination of any of them; the storage, manufacture, handling, disposal, treatment, generation, use, transport, remediation, or Release into the Environment of which is now or hereafter defined by, or prohibited, controlled, or regulated under Environmental Laws; (o) "Contaminated Materials Management Plan" or "CMMP" means the procedures, restrictions, and requirements for handling and management of potentialiy contaminated material (soil, debris, groundwater) on a Contaminated Site within the Development Area. A CMMP has been prepared for the Puip/Tissue Mili Remedial Action Unit (RAU) and is attached as Exhibit B. A CMMP is expected to be prepared for the Chlor-Aikali RAU and will be incorporated herein as Exhibit J upon entry of a corresponding Consent Decree; (p) "Contaminated Site" means any "Facility" under the Model Toxics Control Act (MTCA), Chapter 70.105D of the Revised Code of Washington, and the MTCA Cleanup Regulation, Chapter 1 73- 340 of the Washington Administrative Code (WAC). The Development Area includes Contaminated Sites; Page 3 of 35 (q) "Corix Group" means Corix and its Affiliates and their respective officers, directors, shareholders, empioyees, contractors, agents, successors and permitted assigns; (r) "Current Phase" means the development of the Development Area as contemplated in the Master Development Agreement; (s) "Current Phase Lot" means any lot or iand parcel in the Development Area on which a Building is or will be located and which will be or has been transferred or soid to a Developer; (t) "Customers" means means any Persons who receive Energy Services pursuant to a Customer Agreement; (u) "Customer Service Agreement" means the agreement between Corix and a Customer for the provision of Energy Services, substantially in the form attached as Exhibit G; (v) "DEU" means the district energy utility as contemplated by this Agreement; (w) "District Energy Services Agreement" means an agreement between a Developer and Corix, substantially in the form attached as Exhibit C; (x) "Developer" means Harcourt Bellingham LLC or any other Person or entity to whom Port transfers land or land rights within the Development Area for the purpose of commercial, residential, civic or multi-purpose development; (y) "Development Amendment" has the meaning ascribed to it in Section 2.2; (z) "Development Area" means the Downtown Waterfront District lands and any other lands owned by Port which are subject to the Master Development Agreement, more specifically identified in the map attached as Exhibit A; (aa) "Distribution