ACS/CF
7/19/2017
MASTER PURCHASE AND SALE AGREEMENT
2
31824673v1
THIS MASTER PURCHASE AND SALE AGREEMENT (“Master Agreement”) is made as of the following date: [DATE] (the “Effective Date”) between [SELLER] (“Seller”), a [e.g., Delaware limited liability company] with its principal place of business at [ADDRESS] and Marin Clean Energy, a California joint powers authority (“Buyer”) with its principal place of business at 1125 Tamalpais Avenue, San Rafael, CA 94901 (each, a “Party” and collectively, the “Parties”). This Master Agreement, together with any exhibits, schedules, written supplements, and amendments thereto, and all Transactions shall be referred to as the “Agreement.”
Unless the context otherwise specifies or requires, capitalized terms in this Agreement have the meanings set forth in Article1.
RECITALS
WHEREAS, the Parties wish to buy and sell the Product (as defined herein) on the terms and conditions set forth in the Agreement;
NOW THEREFORE, in consideration of their mutual covenants herein, the Parties agree as follows:
ARTICLE 1DEFINITIONS
1.1. Contract Definitions.
Capitalized terms not defined in Article1 shall have the meaning provided in Exhibit A. The following terms, when used herein with initial capitalization, shall have the meanings set forth below:
“Act” means the Joint Exercise of Powers Act of the State of California (Government Code Section 6500, et seq.).
“Agreement” has the meaning set forth in the preamble.
“Applicable Laws” means all constitutions, treaties, laws, ordinances, rules, regulations, interpretations, permits, judgments, decrees, injunctions, writs and orders of any Governmental Authority that apply to either or both of the Parties, the Project or the terms of this Agreement.
“As-Available” means a Product for which, subject to the terms of this Agreement, (i) Seller is obligated to sell and deliver and (ii) Buyer is obligated to purchase and receive the Energy component of the Product from the Project whenever such Energy is capable of being generated from the Project.
“Business Day” means a day on which Federal Reserve member banks are open for business, beginning at 5:00a.m. and ending at 5:00p.m. Pacific Prevailing Time.
“CAISO” means the California Independent System Operator, or its successor.
“CEC” means the California Energy Commission.
“Confirmation Letter” means a Confirmation Letter in the form of Exhibit A, which is used by the Parties to effect a Transaction and constitutes part of and is subject to the terms and provisions of this Agreement.
“Contract Price” means the amount payable by Buyer to Seller for the Product as agreed upon in the applicable Transaction.
“Costs” means, with respect to the Non-Defaulting Party, brokerage fees, commissions, legal expenses and other similar third-party transaction costs and expenses reasonably incurred by that Party in liquidating or replacing a Terminated Transaction pursuant to Section9.2, entering into any new arrangement that replaces a Terminated Transaction.
“CPUC” means the California Public Utilities Commission.
“Deliver”, “Delivered” and “Delivery” have the meanings set forth in Section2.3.
“Delivery Period” means the period during which Delivery will occur, as specified in the applicable Confirmation Letter.
“Energy” means electrical energy, measured in MWh.
“Firm” means, with respect to a Transaction, that either Party shall be relieved of its obligations to sell and deliver or purchase and receive without liability only to the extent that, and for the period during which, such performance is prevented by Force Majeure. In the absence of Force Majeure, the Party to which performance is owed shall be entitled to receive from the Party which failed to deliver/receive an amount determined pursuant to the applicable Confirmation Letter for such Transaction.
“Force Majeure” means an event or circumstance that materially adversely affects the performance by a Party (“Claiming Party”) of its obligations under this Agreement, which event or circumstance was not reasonably anticipated as of the Trade Date and which is not within the reasonable control of, or the result of negligence of, the Claiming Party, and which the Claiming Party is unable to overcome or avoid or cause to be avoided by the exercise of due diligence, and includes such events as acts of God; fire; flood; earthquake; war; riots; or terrorism that affects one or both Parties. Force Majeure may not be based on (i) the loss or failure of Buyer’s markets; (ii) Buyer’s inability economically to use or resell the Product; (iii) Seller’s ability to sell the Product to another party on terms superior to Seller's terms herein; (iv) Buyer’s ability to purchase similar Product from another party on terms superior to the Buyer’s terms herein; or (v)Seller’s failure to obtain or maintain its permits, interconnection or transmission rights, and site control rights, each with respect to the Project unless any such failure is due to an act of God, fire, flood, earthquake, war, riots or terrorism. With respect to a Party’s obligation to make payments hereunder, Force Majeure will be only an event or act of a governmental authority that on any day disables the banking system through which a Party makes such payments. Force Majeure does not include any action taken by Buyer in its governmental capacity.
“Gains” means the present value of the economic benefit to a Party, if any (exclusive of Costs), resulting from the termination of a Terminated Transaction, determined in a commercially reasonable manner.
“Governmental Authority” means:
(a) Any federal, state, local, municipal or other government;
(b) Any governmental, regulatory or administrative agency, commission, or other authority lawfully exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power; or
(c) Any court or governmental tribunal.
“Interest Rate” is equal to the prime lending rate published under the heading “Money Rates” in the Wall Street Journal on the date of calculation.
“Joint Powers Agreement” means that certain agreement creating Buyer, with an effective date of December 19, 2008.
“Losses” means the present value of the economic loss to a Party, if any (exclusive of Costs), resulting from a Terminated Transaction, determined in a commercially reasonable manner.
“MWh” means megawatt-hour.
“Non-Firm” means, with respect to a Transaction, that delivery or receipt of the Product may be interrupted for any reason or for no reason, without liability on the part of either Party.
“Product” has the meaning set forth in the applicable Confirmation Letter.
“Product Shortfall Amount” has the meaning set forth in Section 2.4.
“Project” means the resource(s) designated in the Confirmation Letter from which the Seller will Deliver the Product.
“Renewable Energy Credit” has the meaning set forth in CPUC Decision D.08-08-028, as such definition may be modified by the CPUC or Applicable Law from time to time.
“Replacement Price” shall mean the price calculated by Buyer at which (a) Buyer, acting in a commercially reasonable manner, purchases a replacement for any Product specified in a Transaction but not Delivered by Seller, plus (i) costs reasonably incurred by Buyer in purchasing such substitute Product, (ii) penalties and fines, if any, and (iii) additional transmission charges, if any, reasonably incurred by Buyer to the Delivery Point, or at Buyer’s option, (b) the market price at the Delivery Point for such Product not Delivered as determined by Buyer in a commercially reasonable manner; provided in no event shall (a) or (b) exceed $100/MWh.
“Replacement Product” means Product meeting all requirements of the Transaction, except for the requirements that such Product (i) be produced by the Facility and (ii) have been delivered during the originally required month of the Delivery Period.
“Settlement Amount” means the Losses or Gains, and Costs, which the Non-Defaulting Party incurs as a result of the liquidation of Terminated Transactions pursuant to Section9.2. If the Non-Defaulting Party’s Gains exceed its Costs and Losses, then the Settlement Amount will be zero dollars ($0.00). The Settlement amount does not include consequential, incidental, punitive, exemplary, indirect, or business interruption damages.
“Shortfall Quantity” has the meaning set forth in Section 2.4.
“Tariff” means the CAISO Fifth Replacement FERC Electric Tariff, as amended from time to time.
“Trade Date” means the “Trade Date” specified in the applicable Confirmation Letter.
“Transaction” means a particular transaction agreed to by the Parties in writing pursuant to a Confirmation Letter relating to the sale and purchase of Product under this Agreement.
“WECC” means the Western Electricity Coordinating Council, the regional reliability council for the Western United States, Northwestern Mexico and Southwestern Canada.
1.2 Rules of Interpretation.
In this Agreement, except as expressly stated otherwise or unless the context otherwise requires:
(a) headings and the rendering of text in bold and italics are for convenience and reference purposes only and do not affect the meaning or interpretation of this Agreement;
(b) words importing the singular include the plural and vice versa and the masculine, feminine and neuter genders include all genders;
(c) the words “hereof”, “herein”, and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement;
(d) a reference to an Article, Section, paragraph, clause, Party, or Exhibit is a reference to that Section, paragraph, clause of, or that Party or Exhibit to, this Agreement unless otherwise specified, and in the event of a conflict, the provisions of the main body of this Agreement shall prevail over the provisions of any attachment or annex;
(e) a reference to a document or agreement, including this Agreement shall mean such document, agreement or this Agreement including any amendment or supplement to, or replacement, novation or modification of this Agreement, but disregarding any amendment, supplement, replacement, novation or modification made in breach of such document, agreement or this Agreement;
(f) a reference to a Person includes that Person’s successors and permitted assigns;
(g) the term “including” means “including without limitation” and any list of examples following such term shall in no way restrict or limit the generality of the work or provision in respect of which such examples are provided;
(h) references to any statute, code or statutory provision are to be construed as a reference to the same as it may have been, or may from time to time be, amended, modified or reenacted, and include references to all bylaws, instruments, orders and regulations for the time being made thereunder or deriving validity therefrom unless the context otherwise requires;
(i) in the event of a conflict, a mathematical formula or other precise description of a concept or a term shall prevail over words providing a more general description of a concept or a term;
(j) references to any amount of money shall mean a reference to the amount in United States Dollars;
(k) the expression “and/or” when used as a conjunction shall connote “any or all of”;
(l) words, phrases or expressions not otherwise defined herein that (i) have a generally accepted meaning in Prudent Operating Practice shall have such meaning in this Agreement or (ii) do not have well known and generally accepted meaning in Prudent Operating Practice but that have well known and generally accepted technical or trade meanings, shall have such recognized meanings; and
(m) each Party acknowledges that it was represented by counsel in connection with this Agreement and that it or its counsel reviewed this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement.
ARTICLE 2TERM AND TRANSACTION
2.1. Term.
The term (“Term”) of this Agreement commences on the Effective Date and continues until terminated by either Party upon thirty (30) days’ prior notice, except that any such termination is not effective until all payments, Deliveries and other obligations of the Parties under all Transactions under this Agreement have been completed.
2.2. Transaction.
Unless specifically excused by the terms of this Agreement during the Delivery Period of any Transaction, Seller shall sell and Deliver, or cause to be Delivered, and Buyer shall purchase and receive, or cause to be received, the Product, and Buyer shall pay Seller the Contract Price, all in accordance with the terms of this Agreement, including the Confirmation Letter associated with any Transaction. The Parties recognize that Seller is not a retail provider, the transaction is a sale for resale, and Buyer will resell the Product purchased from Seller to third parties.
2.3. Delivery.
During any Delivery Period specified in a Confirmation Letter, Seller will deliver the Energy associated with the Product to the Delivery Point (“Deliver”, “Delivered” or “Delivery”). The Parties intend for the Product to be physically settled. Each Party will bear its own expenses associated with Delivery. Delivery will consist of Product in whole MWh.
2.4. Delivery Failure.
During any month of the Delivery Period, if the quantity of Product Delivered by Seller is less than the amount required under the Transaction and such failure is not excused under the terms of the Product (such amount, the “Shortfall Quantity”), Seller shall pay to Buyer an amount (the “Product Shortfall Amount”) equal to the product of (i) the amount (whether positive or negative), if any, by which the Replacement Price differed from the Contract Price (Replacement Price - Contract Price) and (ii) the Shortfall Quantity. If the total amounts for all days calculated under this paragraph are negative, then neither the Purchaser nor the Seller shall be liable for the Product Shortfall Amount.
Notwithstanding the foregoing, for Products with a Contract Price that is Indexed, Seller may, as an alternative to paying Product Shortfall Amounts, provide Replacement Product that is (i) delivered to Buyer at NP 15 EZ Gen Hub, (ii) scheduled via day-ahead Inter-SC Trades (or as otherwise provided under the Confirmation Letter) within ninety (90) days after the month during which Seller fails to deliver the Shortfall Quantity, (iii) delivered upon a schedule reasonably acceptable to Buyer, and (iv) delivered to Buyer without imposing additional costs upon Buyer. Seller must give Buyer written notice of Seller’s intent to Deliver Replacement Product within ten (10) Business Days of the applicable month in which the Shortfall Quantity occurred. Buyer will pay Seller for all such Replacement Product provided pursuant to this Section 2.4 at the Contract Price.