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HomeMy WebLinkAbout4335 Resolution - Burnham Wastewater Treatment Agreement RESOLUTION NO.4335 A RESOLUTION OF THE CITY OF PASCO, WASHINGTON, ENTERING WRITTEN FINDINGS AND AUTHORIZING THE INTERIM CITY MANAGER TO ENTER INTO THE WASTEWATER TREATMENT AGREEMENT WITH BURNHAM FOR THE PWRF PRETREATMENT IMPROVEMENTS PHASE 3 PROJECT. WHEREAS, the City of Pasco (City) operates a Process Water Reuse Facility(PWRF) to treat industrial wastewater from Food Processors(Processors)located in the vicinity of the City of Pasco; and WHEREAS, the City's current PWRF system has reached its design life and capacity, such that upgrades and expansion are necessary to accommodate new agricultural food processor wastewater; and WHEREAS, Burnham SEV, a renewable natural gas (RNG) Project Developer, was selected, through processes outlined in Chapter 70A.140 RCW, to privately develop a new industrial wastewater treatment plant,utilizing a low-rate anaerobic digester and nitrogen removal system (System) along with a renewable natural gas plant at the PWRF; and WAEREAS, City and Burnham SEV entered an agreement on November 24, 2021, wherein the City(and Processors) agreed to support the cost of initial engineering for the System; and WHEREAS, Chapter 70A.140 RCW, Water Quality Joint Development Act, provides a mechanism for the City to provide service from water pollution control facilities by means of services agreements with public or private parties; and WHEREAS, pursuant to RCW 70A.140.040(9), prior to execution of the Wastewater Treatment Agreement with Burnham, Burnham and the City understand the necessity of submitting the "proposed service agreement" to the Department of Ecology to review for consistency with RCW 90.46 and RCW 90.48, as a condition precedent to the City's authority to execute the Wastewater Treatment Agreement with Burnham; and WHEREAS, this Agreement was submitted to the Department of Ecology on September 15, 2022, satisfying the condition precedent to the City's execution of this Agreement and is in substantially the same form as was reviewed by the Department of Ecology; and NOW,THEREFORE,BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON: Resolution—Burnham SEV Pasco,LLC Wastewater Treatment Agr.- 1 Section 1. Findin�s. After a public hearing on February 6,2023 was held,the below findings are hereby adopted by the City Council: A. The City of Pasco has determined that it is in the public interest to enter into the service agreement with Burnham SEV Pasco, LLC; B. The service agreement includes project performance bonds or other security by the service provider which in the judgment of the public body are sufficient to secure adequate performance by the service provider; C. That the service agreement includes a provision for an option by which a public body may acquire at fair market value facilities dedicated to such services; D. That the service agreement is financially sound and advantageous compared to other methods. Section 2. DeleQation of Authoritv. That the Interim City Manager is hereby authorized to execute the Wastewater Treatment Ageement with Burnham SEV Pasco, LLC for the PWRF Pretreatment Improvements Phase 3 Project, a copy of which is attached hereto and incorporated herein by reference as Exhibit A; in substantially the same form and to make substantive changes as necessary to execute the Agreement consistent with the intent of the City Council. Be It Further Resolved, that this Resolution shall take effect and be in full force immediately upon passage by the City Council. t�SE �+-t�City Council of the City of Pasco,Washington,this 3�day of April,2023. ... , Blan arajas � - Mayor ATTEST: APPROVED AS TO FORM: �� ���� r Debra Barham, CMC Kerr Fer , PLLC City Clerk Cit orneys Resolution—Burnham SEV Pasco,LLC Wastewater Treatment Agr. -2 WASTEWATER TREATMENT AGREEMENT Betrveen Burnham SEV Pasco LLC And The City of Pasco, Washington Effective April 10, 2023 506528698.4 TABLE OF CONTENTS Page 1. Recitals............................................................................................................................... 1 2. Term...................................................................................................................................3 3. Burnham Obligations.........................................................................................................3 4. City Obligations.................................................................................................................6 5. Payment for System and Services; Change Orders............................................................8 6. Non-Material and Material Breaches of this Agreement................................................. 13 7. Remedies; Cross-Defaults................................................................................................ 14 8. Title, Ownership, and Risk of Loss; Transfer of Environmental Attributes.................... 19 9. Representations and Warranties.......................................................................................20 10. Indemnification................................................................................................................20 11. Limitation of Liability......................................................................................................24 12. Insurance..........................................................................................................................24 13. Force Majeure..................................................................................................................25 14. Confidentiality.................................................................................................................25 15. Governing Law and Disputes.......................................................................... ................. 16. Miscellaneous ..................................................................................................................27 ExhibitA......................................................................................................................................31 ExhibitB......................................................................................................................................33 ExhibitC......................................................................................................................................38 ExhibitD......................................................................:...............................................................40 ExhibitE......................................................................................................................................41 ExhibitF.......................................................................................................................................47 ExhibitG......................................................................................................................................50 ExhibitH......................................................................................................................................51 -i- 506528698.4 WASTEWATER TREATMENT AGREEMENT This Wastewater Treatment Agreement ("Agreement") is entered into � � (the "Effective Date") by and between Burnham SEV Pasco LLC, a Washington limited liability company("Burnham"),with offices at 1201 Wilson Blvd—27�'Floor,Arlington VA,22209, and the City of Pasco, Washington (the"City"), a municipality with offices at 525 N 3rd Ave., Pasco, WA 99301 (each a"Party" and together, the "Parties"). 1. Recitals 1.1 The City owns and operates a wastewater utility, including a process wastewater reuse facility ("PWRF") that operates for the benefit of the City and large agricultural food processors to pretreat, treat, and dispose of approximately one billion gallons of agricultural industrial wastewater by land application on approximatively 1,854 acres of City-owned farmland. See Washington State Discharge Permit No. ST0005369. The existing PWRF consists of a primary treatment process (including two rotary drum screens, one modified clarifier, twelve (12) septic tanks for solids collection from the clarifier, one screw press for solids removal from the rotary drum screens system), one approximately five million gallon ("MG") pond previously used as solids storage, one approximately eight MG pond used as an equalization pond, one approximately 35 MG pond for winter storage, and one 115 MG pond for winter storage, and an irrigation pumps/pipes system for land application of agricultural industrial wastewater; and 1.2 The City's current PWRF system has reached its design life and capacity, such that upgrades and expansion are necessary to accommodate existing and new agricultural food and dairy processor wastewater. To meet the Washington Department of Ecology's ("Ecology") permit requirements to expand the PWRF's capacity, the City sought a contractor capable of treating agricultural and milk processing industrial wastewater and using the biogas produced from such treatment to generate Renewable Natural Gas ("RNG"). Following a competitive selection process, the City selected Burnham SEV Pasco LLC ("Burnham") to develop, design, construct, and operate a wastewater treatment and nitrogen reduction system (the "System," as more particularly described in Exhibit A) that integrates Burnham's RNG production process. Burnham is to finance, design, construct, own, operate, and maintain the System on City-owned property leased by Burnham; and 1.3 The City is in the process of preparing and submitting a new Washington State Waste Discharge Permit ("Discharge Permit") application to Ecology, to include the System and all other components of the agricultural industrial wastewater treatment and disposal process. The City will develop, operate and maintain other facilities, including its storage ponds (equalization and winter storage), irrigation system, land application area, and all related assets (e.g., conveyance water pipes, pump stations, wells and appurtenances) (collectively, "City Facilities") and the City intends to be a joint permittee with Burnham under the Discharge Permit with roles and responsibilities for its implementation as defined in this Agreement; and 1 506528698.4 1.4 The City has sought to utilize the provisions of RCW 70A.140, the Water Quality Joint Development Act, for the purpose of providing an additional means by which to provide financing, development, and operation of water pollution control facilities needed for achievement of state and federal water pollution control requirements for the protection of the state's waters; and 1.5 The System and City Facilities will be supported from rates and fees paid to the City by agricultural and dairy waste processors (provided, however, that the waste processor payments to City are not a condition of any obligation between City and Burnham in this Agreement); and 1.6 Pursuant to RCW 70A.140.040(9),prior to execution of this Agreement,the Parties were required to submit this "proposed service agreemenY' to Ecology to review for consistency with RCW 90.46 and RCW 90.48, as a condition precedent to the City's authority to execute this Agreement; and 1.7 A draft of this Agreement was submitted to Ecology on October 7,2022, satisfying the condition precedent to the City's execution of this Agreement, and Ecology approved the draft Agreement on November 7, 2022; and 1.8 Pursuant to RCW 70A.140.040 (10), the City held a public hearing on February 6, 2023, and made written findingsl that it is in the public interest to enter into this Agreement and that this Agreement is financially sound and advantageous compared to other methods; and 1.9 The Parties entered into the Anaerobic Digestion and Renewable Natural Gas Project Work Acceleration Agreement on September 7, 2022, the Wastewater Treatment,Anaerobic Digestion and Renewable Natural Gas Project Second Wark Acceleration Agreement on December 8, 2022, and the Wastewater Treahnent, Anaerobic Digestion and Renewable Natural Gas Project Third Work Acceleration Agreement on February 9, 2023 (collectively, the "Work Acceleration Agreements") allowing Burnham to undertake certain engineering, legal, permitting, regulatory, financing, design, and other activities to advance the System, including without limitation payments to Swinerton Builders, Inc. ("Swinerton"), and which obligated City to reimburse Burnham up to $7,500,000 for such activities; and 1.10 All capitalized terms in this Agreement shall have the meanings given to them in Exhibit E (Definitions). 1.11 In consideration of the foregoing and for mutual and valuable consideration, the sufficiency of which are acknowledged, the Parties agree as follows: 1 [NTD: Need to update this date] 2 506528698.4 2. Term 2.1 This Agreement shall become effective upon the Effective Date and terminate thirty (30) years after COD (the "Initial Term"), unless terminated in accordance with this Agreement or extended as provided in Section 2.2. 2.2 Upon expiration of the Initial Term, this Agreement shall automatically extend for two additional five(5)-year periods(each a"Renewal Term"and together with the Initial Term, the "Term"), unless terminated by either Party by sending written notice of termination to the other Party no later than one hundred and eighty (180) days before the end of the Initial Term or any Renewal Term, as applicable. 2.3 At the end of the Term, unless as specified elsewhere in this Agreement, City has the option to purchase all right, title, and interest in and to the System, on an"AS- IS" "WHERE IS" basis, without any warranty or further liability to Burnham. In the event the City elects to exercise this purchase option,(a)the procedures set forth in Section 5.5(a) shall be applied and (b) the purchase price shall be equal to the appraised fair market value determined by considering(i)Sections 5.5(b)and 5.5(e) and (ii) the cost approach for appraisals, which shall account for, among other things, the decline in economic value of the System due to the passage of time. Each Party agrees to cooperate with the other Party to take the necessary actions and execute the necessary documents to effectuate such purchase and sale. Following such purchase and sale,unless as specified elsewhere in this Agreement, neither Party shall owe any further liability or obligation to the other Party. 3. Burnham Obligations 3.1 In addition to any other obligations explicitly set forth herein, Burnham (or its agents, contractors, and subcontractors,which for the purposes of this section shall be referred to as "Burnham") shall perform or comply with the following obligations (each a "Surnham Obligation" and together the "Burnham Obligations"): (a) Construction A�reement. Burnham shall maintain in full force and effect the Progressive Design Build Agreement and/or shall enter into any other agreements with service providers necessary to design, develop and construct the System. Burnham shall use commercially reasonable efforts to have City named as a loss payee under(i)the Property Insurance required under this Agreement, and (ii) performance or surety bonds under the Progressive Design Build Agreement or any such similar agreements; (b) Notice to Proceed.Commencing on the Effective Date,Burnham shall make commercially reasonable efforts to conduct all required diligence, obtain the Burnham Permits in accordance with Exhibit G, and issue a Notice to Proceed ("NTP") for construction of the System by May 29, 2023. ("NTP Date"). In all cases, Burnham shall issue its NTP within ninety (90) calendar days of the NTP Date ("NTP Longstop Date"); provided, 3 506528698.4 however, that the NTP Date and NTP Longstop Date will be extended on a day-for-day basis upon the occurrence of any Force Majeure or due to any City Caused Delay or Ecology Delay; (i) If Burnham fails to issue the NTP on or before the NTP Longstop Date each Party has the right, but not the obligation, to terminate this Agreement upon ten(10)business days advance notice, with no further liability owed or owing to the other Party; provided, however, that if City seeks to terminate the Agreement under this section: (1) City must have obtained the City Permits at least sixty (60) calendar days before the NTP Longstop Date and made the rights and obligations of such City Permits reasonably available to Burnham; and (2) City has complied, or if compliance is not yet possible City stands ready to comply, with all applicable City Obligations as set forth in Section 4.1. (c) Commercial Operation. Commencing on NTP, Burnham shall make commercially reasonable efforts to cause the System to reach Commercial Operation by December 31, 2024 ("COD"). In all cases, Burnham shall cause the System to reach Commercial Operation by June 30, 2025 ("COD Longstop Date"); provided, however, that the COD and COD Longstop Date dates will be(x) extended on a day-for-day basis upon the occurrence of any Force Majeure or due to any City Caused Delay or Ecology Delay, (y) and extended per the conditions of Section 7.1(b)(iii). In no circumstances shall any monies accrued but outstanding between the Parties delay Commercial Operation or COD. Burnham shall notify City within ten (10) business days subsequent to the System reaching COD, as confirmed by an independent third-party engineer. At the end of the Term, the System shall remain in Commercial Operation, but subject to City control, unless the Parties agree otherwise; (d) Services. Commencing on COD and throughout the Term, Burnham shall own and operate the System and provide the City with the Services listed in Exhibit B in a manner consistent with Prudent Industry Practices; (e) Effluent Water. Commencing on COD and during the Term,Burnham shall own and operate the System to discharge Effluent Water to City in accordance with the specifications, terms, and conditions in Exhibit D and consistent with Prudent Industry Practice; (fl Burnham Permits. Commencing as of the Effective Date, Burnham shall apply for, procure, and maintain throughout the Term, at its sole cost and expense, all Permits reasonably required for the design, construction, 4 506528698.4 operation, or maintenance of the System, including without limitation the Burnham Permits set forth in Exhibit G, except for any City Permits identified specifically on Exhibit G; and (g) Cooperation. Commencing on the Effective Date, Burnham will cooperate with the City in connection with (1) promptly obtaining any System Pertnits; (2)promptly providing information necessary for the design, construction, operation, or maintenance of the System as reasonably requested by the City; and(3) any other information or effort as reasonably requested from time to time by City to fulfill each Party's responsibilities under this Agreement. (h) Pass-Throu�h Costs. Burnham will make commercially reasonable efforts throughout the Term of this Agreement to obtain prudent pricing for the Pass-Through Costs at set forth in Exhibit F. (i) Gross Wen Nitro�en Reduction Process Performance Guarantees.Burnham will obtain performance guarantees for the Gross Wen Process (the"Gross Wen Process Performance Guarantees"). To the extent circumstances arise that entitle Burnham to pursue its rights, including without limitation compensation, from the Gross Wen Process Performance Guarantees, Burnham will use commercially reasonable efforts to first pursue the repair, replacement, or modification of the Gross Wen Process under the Gross Wen Process Performance Guarantees to meet the performance criteria. If such repair, replacement, or modification is not possible, Burnham shall pass through all liquidated damages received due to a breach of the Gross Wen Process Performance Guarantee,net of collection costs, directly to the City. In addition, Burnham shall match any liquidated damages paid to the City under this clause on a dollar-for-dollar basis,up to a maximum of$1.67 million... (j) Prevailin��. Burnham will satisfy the prevailing wage requirements in RCW 39.12.020 for construction and operation of the System. (k) Optional Performance Bond.2 At any time after the first anniversary of the Effective Date, City may submit to Burnham a written notice for Burnham to run a competitive bid process for the purposes of obtaining a Service Contract Performance Bond. City and Burnham shall provide reasonable cooperation in determining the key terms and conditions that such Service Contract Performance Bond will include. Burnham shall have up to one hundred eighty (180) days to solicit competitive bids from one or more vendors and provide them to City. Burnham and City shall cooperate in good faith to determine whether a Service Contract Performance Bond is necessary and available, and if so, which vendor to select to provide such 2 [NTD: This was removed in last turn by S. Worley. Seems perhaps it was important to Eric or some of the processors?] 5 506528698.4 Service Contract Performance Bond. Should City require that Burnham procure a Service Contract Performance Bond, all costs and fees associated with obtaining and maintaining such Service Contract Performance Bond shall be passed through to City consistent with Exhibit F. 3.2 Burnham's parent company, Burnham Pasco HoldCo LLC, a Delaware limited liability company with offices at 1201 Wilson Blvd — 27th Floor, Arlington VA, 22209 ("Parent"), shall use best efforts to obtain and receive, directly ar indirectly through one or more owners of equity issued by Parent in consideration for or otherwise in respect of any U.S. federal income tax credit pursuant to section 48 of the Internal Revenue Code of 1986, as amended and restated, that is available in respect of that portion of the System that constitutes energy property as such term is used in such section. Within one hundred eighty(180) days of receiving the cash proceeds from the sale of any tax credit Parent ar assignee,as applicable,shall agree with City on a payment schedule where City will receive credit over the length of the Initial Term equal to, at City's option, either (i) 90% of such cash received for the sale of federal tax credits, or(ii) $7,200 per month for each$1,000,000 of such cash received for the sale of federal tax credits (rounded to the nearest million). For the purposes of this Section 3.2 only, Parent shall be a third-party beneficiary under this agreement and City shall have the right to enforce this Section 3.2 against Parent directly. Except as set forth in this Section 3.2, Parent has no rights, obligations, or liabilities and has made no representations and warranties under this Agreement. Section 3.2 AGREED AND ACCEPTED TO: BURNHAM SEV PASCO LLC CITY OF PASCO,WASHINGTON BURNHAM PASCO HOLDCO LLC By: By: By: Name: Chris Tynan Name: Adam Lincoln Name: Chris Tynan Title: CEO Title: City Manager Title: CEO Date: Date: Date: 4. City Obligations 4.1 In addition to any other obligations set forth herein, including any obligations in Exhibit C, City shall comply with the following obligations (each a "City Obligation"and together the"City Obligations"): (a) Site. No later than five (5) business days after the Effective Date (the"Site Delivery Date"}, the City shall execute a lease with Burnham in the form attached as Exhibit H granting Burnham a sufficient leasehold and all appurtenant rights and privileges necessary for Burnham to construct, operate, and maintain the System and perform the Services more particularly described in Exhibit C (the"Site"); 6 506528698.4 (b) Facilitv Plan A�proval;Citv Permits No later than Apri115,2023,City shall receive approval on the Facility Plan associated with the Project.Any delay in receiving approval on the Facility Plan beyond April 15, 2023 will be an "Ecology Delay;" provided, however, that Burnham in its reasonable discretion may waive this City Obligation upon sufficient proof that Ecology intends to approve the Facility Plan by May 5, 2023. City shall maintain throughout the Term, at its sole cost and expense, all City Permits as set forth in Exhibit G; (c) Cooperation. Commencing on the Effective Date, the City will cooperate with Burnham in connection with (1) financing the System, including executing any additional approvals,estoppels,consents,or other documents as reasonably requested with respect to this Agreement and obtaining title insurance for the site lease contemplated in Exhibit H; (2) promptly obtaining any System Permits; (3) promptly providing information necessary for the design, construction, operation, or maintenance of the System; and (4) any other information or effort as reasonably requested by Burnham from time to time to fulfill each Party's responsibilities under the Agreement; (d) Influent Water. Commencing on COD and continuing throughout the Term, at City's sole cost and expense City shall provide Burnham with Influent Water from food and dairy processors in accordance with the specifications in Exhibit C. If at any time Burnham becomes aware that Influent Water delivered by the City or processors is Non-Conforming Influent Water, Burnham may, in its sole discretion,bypass such Non-Conforming Influent Water to the City-owned Storage Pond (as described in Exhibit A) and promptly provide City with notice of such bypass and the reason for same; provided, however, that Burnham's acceptance of Non-Conforming Influent Water shall not relieve City of any responsibility or any costs, damages,or liabilities associated with Non-Conforming Influent Water,and by acceptance Burnham does not waive any other rights or remedies associated with City's or processor's delivery of Non-Conforming Influent Water. (e) Pa ment. The City shall pay Burnham in accordance with Section 5; and (fl Financin 7�, Cooperation. Commencing on the Effective Date, the City shall cooperate with, and provide Burnham with information concerning, City's water and sewer utility, including without limitation operational and financial data consistent with and substantially similar to City disclosures provided in connection with City's issuance of municipal bonds associated with such utility. The City shall execute a continuing disclosure agreement or certificate in connection with the Outstanding Debt that complies with Rule 15c2-12(b)(5) adopted by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as the same may be amended from time to time,related to its water and sewer utility, substantially similar 7 506528698.4 to the disclosures the City provides in connection with its issuance of municipal bonds in connection with such utility. (g) Nitro�en Mana e� ment. To the extent the Discharge Permit's nitrogen or associated constituent (e.g., nitrates) limits are exceeded resulting in any Notices of Violations from Ecology or Claims from other third-parties and all remedies of the Gross Wen Performance Guarantees have been provided, City shall submit a request to Burnham under Section 5.4 for Modifications to the System reasonably sufficient to bring nitrogen and associated constituent levels within Discharge Permit limits, including without limitation installing a moving bed biofilm reactor and any related infrastructure. 4.2 If there are any changes in City's ability to comply with the City Obligations in Exhibit C, any material change in circumstances at the Site, or a Change of Law that necessitates a change to the System or the services to be provided by Burnham in connection herewith(individually or collectively, "Changed Circumstances"), and not as a result of any actions taken by Burnham that interfere with City's ability to comply with the City Obligations, City shall be solely responsible for any increased costs incurred by Burnham to operate the System due to such Changed Circumstances. The Parties agree to negotiate any necessary Modifications in accordance with Section 5.4 to accommodate any Changed Circumstances. 5. Payment for System and Services; Change Orders 5.1 Commencing on COD and continuing throughout the Term, City shall pay Burnham the Adjusted Treatment Fee (as modified, if applicable), Pass-Through Costs and any applicable adjustments as calculated and invoiced by Burnham on a monthly basis in accordance with Exhibit F. (a) Except in the case of Material Breach by Burnham, a Force Majeure lasting more than six (6) months, or as explicitly specified in this Agreement, commencing on Commercial Operation City shall pay to Burnham the Adjusted Treatment Fee each month and through the end of the Term notwithstanding any failure by City to deliver Influent Water or failure or inability of Burnham to accept Influent Water or deliver Effluent Water. (b) If the System is able to accommodate Darigold Operations at any time before the COD Longstop, City shall pay to Burnham 30% of the Adjusted Treatment Fee each month until the System reaches Commercial Operation, after which City shall pay Burnham in accordance with Section 5.1(a). (c) The City acknowledges, covenants, represents, and warrants that all payments made by the City to Burnham shall be deemed operations and maintenance costs of the water/sewer utility pursuant to the Pasco Municipal Code, Section 13.10.010. 8 506528698.4 5.2 Within ten(10)business days after the end of each month after COD,Burnham will issue to City an invoice in accordance with Exhibit F for the Adjusted Treatment Fee (as modified, if applicable), Pass-Through Costs, and any applicable adjustments billed in the immediately preceding month along with any documentation reasonably necessary to support amounts due by the City. The City shall pay each Burnham invoice within thirty (30) calendar days after receipt; provided, however, that City may, in good faith, dispute the correctness of any invoice, Adjusted Treatment Fee, Pass-Through Costs, and any applicable adjustments or adjust any invoice for any arithmetic or computational error upon written notice to Burnham, stating the basis for the dispute or adjustment;provided further, however, that City shall remain obligated to pay all amounts when due except for those amounts disputed due to arithmetic or computational errors. To the extent any disputed amounts are resolved in the City's favor, such previously disputed amounts will be credited or invoiced to City on the following month's invoice from Burnham. Payment will be made by check, cash or electronic funds transfer, or by another mutually agreeable method(s),to the account determined by Burnham. 5.3 If City fails to pay any amount due to Burnham under this Agreement within five (5) business days subsequent to the date such amount was due, then such unpaid amount shall bear interest from the due date until paid in full at the rate of twelve percent (12%) per annum, or, if less, the highest rate permitted by law ("Late Payment Rate"). If the due date of any payment falls on a Sunday or bank holiday, the next business day following such date shall be the last day on which payment can be made without assessment of interest and a late fee. 5.4 At any time during the Term, City may request additional services from Burnham or request any alterations, additions, omissions, modifications, or changes in the scope, schedule, sequence, methods, or performance of the System or Services (collectively, "Modifications").Burnham agrees to reasonably cooperate with City to evaluate and implement any reasonable Modifications proposed by City; provided, however, that the Parties must agree to any such Modifications using the following process: (a) City shall submit a request for additional services in writing to Burnham; (b) Burnham shall submit a written change order to City setting forth the Modifications and expected costs of such Modifications; (c) City shall confirm its agreement to such Modifications and to pay all costs associated with such Modifications, if any, by executing such change order and returning it to Burnham; (d} Following receipt of the City's executed change order, Burnham shall modify Exhibit F to reflect the costs of the agreed upon Modifications; and 9 506528698.4 (e) Any change order evidencing any such Modifications and the modified Exhibit F will become a part of this Agreement and incorporated by reference. (fl Any disputes over a change order or any associated Modification will be handled in accordance with the dispute resolution procedures in Section 15. 5.5 Cit O tion to A uire S stem at Fair Market Value.At any time after the Effective Date, the City shall have an option to purchase the System at Fair Market Value consistent with the requirements of RCW 70A.140.040; provided, FMV shall be determined according to this Agreement Section 5.5. (a) The City shall exercise its option to purchase the System using the following procedure: (i) Following City Council authorization, the City shall send Burnham notice of City's intention to acquire the System for FMV together with an appraisal of FMV prepared by an independent valuation consultant experienced in the valuation of public utility systems. The consultant shall use the methodology as described in 5.5(b) through Section 5.5(d). (ii) Within ninety(90) days of the notice in Section 5.5(a)(i), City shall finalize a plan with Lender(s) for City to either: (1) assume all Outstanding Debt; or (2) pay off of all Outstanding Debt,including without limitation paying any associated breakage fees or costs associated with such Outstanding Debt. In either case, City shall share such plan with Burnham promptly after such plan is finalized. (iii) In the event Burnham disagees with FMV as determined by the City-engaged consultant, within ninety (90) days of the notice in Section 5.5(a)(i), Burnham shall engage a nationally known and experienced valuation consultant to calculate FMV for the System, using the methodology as described in Section 5.5(a)(iv). (iv) Within one hundred eighty (180) days of the notice in Section 5.5(a)(i), Burnham shall deliver to City a report from the valuation consultant calculating FMV for the System. City shall have thirty (30) days to review the valuation report and agree on the FMV. If the FMV valuations are within ten percent(10%)of each other,then the FMV shall be set at the average of the two valuation reports. If the valuation reports are more than ten percent 10% apart, and the Parties are unable to agree on a path forward, then the Parties shall mutually select and share the costs of a third third-party valuation 10 506528698.4 consultant. The third third-party valuation consultant shall be provided both previous valuation reports. The third valuation consultant shall then conduct a FMV valuation and issue an opinion of FMV within thirty(30) days of being retained. That opinion shall be binding and shall set the FMV. (v) Within one hundred eighty(180)days of agreeing on or determining FMV, City and Burnham shall execute all necessary and customary documents to transfer the System to City in exchange for Burnham receiving FMV. (vi) The City may withdraw its notice of intention to purchase the System for FMV at any time and for any reason. In that case, City may not exercise its option to purchase the System for FMV for one (1)year, starting on the date of withdrawal. (b) Whether determined by Burnham, City, or any valuation consultant, FMV shall be determined using the net present value method of valuation considering all expected revenue and expenses over the life of the System, including all revenue expected to be earned over the life of this Agreement: (i) If the City chooses to assume the Outstanding Debt,the valuation of Burnham's equity interest will account for all future equity distributions (including without limitation all costs, expenses, and debt service under the Outstanding Debt) and these equity distributions will be discounted at the City's then-current cost of capital. (ii) If the City chooses to pay off the Outstanding Debt, the amount necessary to pay off the Outstanding Debt (including, without limitation, all associated breakage fees and costs) will be added to the equity value calculation in Section 5.5(b)(i). (c) Further, the FMV valuation should account for each of the following, in addition to any special considerations in Section 5.5(d): (i) The amount that a willing and able buyer would offer, and a willing and able seller would accept,for the purchase and sale of Burnham's interest in the System, in an arm's length transaction, assuming: (1) Neither party is under economic compulsion or has special bargaining power; (2) the buyer possesses all information in the possession of City relating to the System, its condition, and the revenues and expenses of Burnham; 11 506528698.4 (3) The event or circumstance that requires determination of fair market value had not occurred and accordingly this Agreement and Burnham's ownership of the System would remain in effect and Burnham would remain a going concern for the balance of the Initial Term; (4) There exists no prior, known or reasonably foreseeable unusual temporary event or circumstance specific to the System (e.g., damage, operating performance disruptions or destruction) or to market and economic conditions, positive or negative. If such event or circumstance consists of damage or destruction, FMV will exclude (A) the estimated cost to repair and replace the damage or destruction and (B) the loss of revenues during the estimated time to repair and replace the damage or destruction, and Burnham will retain the right to insurance coverage for loss occasioned thereby; (5) There would occur no future unusual temporary event or circumstance specific to the System (e.g., damage or destruction) or to market and economic conditions, positive or negative,not known or reasonably foreseeable at the time of valuation; (6) There would occur no future Change of Law not known or reasonably foreseeable at the time of valuation; (7) There exists no adverse effect from a City Material Breach or Non-Material Breach, and both Parties would generally continue to perform their respective obligations under this Agreement for the remainder of the Initial Term absent early termination; and (8) Short-term impairments to the value of the System such as temporary damage or operating performance shortfalls are reasonably rectified if within Burnham's responsibility under the Agreement. (ii) Reimbursement to Burnham of any reasonable and documented costs associated with demobilizing operations at the System. (iii) Reimbursement to Burnham of any reasonable and documented costs associated with demobilizing operations, terminating the site lease contemplated in Section 4.1(a), or terminating contracts with third-party contractors (including affiliates), including without limitation any costs and liabilities associated with Burnham's non- contractual liabilities and indemnity obligations. 12 506528698.4 (iv) Any reimbursement to Burnham under Sections 5.5(c)(ii) and 5.5(c)(iii) shall be the full and agreed reimbursement available to Burnham under Chapter 8.26 RCW for any relocation assistance. (v) Reimbursement to Burnham of any incremental tax liabilities incurred by Burnham as a result of the exercise of City's option. (d) Timing of City's Exercise of Option and Calculation of FMV. (i) If Burnham or City must determine FMV before COD, then it shall be assumed that COD will occur on or before the COD Longstop Date and that the System shall be operational through the Initial Term. (1) In that case, FMV shall account for the capital costs previously expended and expected capital costs to achieve substantial completion and COD under the then-current construction schedule. If City and Burnham disagree on the cost to complete estimates, Burnham may choose to complete the System before selling the System to City, with the City's cost of completion not contemplated in FMV determination. (ii) If Burnham or City must determine FMV before COD or within the first three (3) years of the Initial Term, in addition to the considerations in Section 5.5(b) through Section 5.5(d)(i), FMV must assume the System will achieve full operational capacity as contemplated by the Agreement. (iii) If Burnham or the City must determine FMV before Burnham or Parent receives any tax credit contemplated in Section 3.2,the FMV valuation will include the expected value of any tax credit reasonably expected to be received over the life of the Agreement. (e) If the City exercises its right to purchase the System at FMV, City shall be required to assume the terms of the RNG Offtake Agreement and RNG Interconnection Agreement, or enter into replacement agreements on materially similar terms and conditions and for the same duration. 6. Non-Material and Material Breaches of this Agreement 6.1 Any breach under this Agreement by either Party that is not a Material Breach shall be a"Non-Material Breach." b.2 The following circumstances shall constitute a "Material Breach" by the applicable non-performing Party: 13 506528698.4 (a) Burnham's failure to reach Commercial Operation within one hundred eighty (180) calendar days of the COD Longstop Date; (b) The City's failure to make any payment required under this Agreement and invoiced by Burnham in accordance with Section 5 and Exhibit F;provided, however, that Burnham shall provide written notice of such failure to the City and the City shall have thirty (30) days to submit payment in full following such notice; (c) Burnham's failure to operate the System or perform the Services consistent with Prudent Industry Practices that results in an Effluent Water Failure lasting more than twelve (12) months;provided, however, that so long as Burnham has provided the City with a written plan, consistent with Prudent Industry Practices and approved by an independent engineer, for resolving such Effluent Water Failure, such failure shall not be a Material Breach; (d) Notwithstanding the provisions in Section 6.2(c) above, Burnham's failure to operate the System or perform the Services consistent with Prudent Industry Practices that results in an Effluent Water Failure lasting more than twenty-four(24) consecutive months; (e) In respect of either Party,the other Party's material misrepresentation,fraud or intentional misconduct in connection with this Agreement; (� In respect of either Party, an Insolvency Event for that Party; 7. Remedies; Cross-Defaults 7.1 Remedies for Non-Material Breaches of Certain Burnham Obligations. (a) Burnham's failure or inability to meet the Effluent Water specifications listed in Exhibit D ("Effluent Water Failure") shall be a Non-Material Breach of this Agreement, with the liability, costs, and responsibility for remedying an Effluent Water Failure to be determined as follows: (i) Upon either Party's determination that an Effluent Water Failure has occurred,such Party shall provide a reasonably detailed notice to the other Party explaining the circumstances of such Effluent Water Failure no later than ten(10)days of such determination.The Parties will immediately cooperate and take steps to remedy such Effluent Water Failure consistent with Section 7.6. (ii) Burnham will be responsible and have sole discretion for performing all work on the System reasonably required to remedy the Effluent Water Failure and bear all liabilities associated with such work. The City will bear all costs associated with remedying the Effluent Water Failure except as noted in 7.1(c), with any costs incurred separately by Burnham invoiced to City as Pass—Through 14 506528698.4 Costs or, if necessary, added to Exhibit F using the change order process in Sections 5.4(a) through 5.4(�. (iii) Notwithstanding the above, if Burnham's failure to operate the System or perform the Services consistent with Prudent Industry Practices was the primary cause of the Effluent Water Failure, Burnham shall bear all costs and liabilities associated with remedying the Effluent Water Failure. Notwithstanding the above, if the Effluent Water Failure was caused by City's delivery of Non- Conforming Influent Water, such remedy shall be determined by Section 7.2(c). (iv) If Burnham fails to deliver Effluent Water in accordance with Exhibit D 3.1(e)or delivers Non-Conforming Effluent Water, City shall promptly notify Burnham of such failure and Burnham shall be solely responsible for any and all losses, damages to City Facilities, or additional costs incurred by City that were caused by Burnham's failure or delivery of Non-Conforming Effluent Water, including without limitation any additional costs of treating, handling, storing, and disposing of such Non-Conforming Effluent Water or discharging Non-Conforming Effluent Water to the City- Owned Storage Pond. (b) Burnham's failure to reach Commercial Operation by COD shall be a Non- Material Breach of this Agreement, with the liability, costs, and responsibility for such failure to be determined as follows: (i) if Burnham fails to reach Commercial Operation by the COD, Burnham shall pay to City the COD Delay Damages for each day following the COD until Commercial Operation is reached or the COD Longstop Date is reached, whichever is earlier; (ii) if Burnham fails to reach Commercial Operation by the COD Longstop Date,Burnham shall pay to City the COD Longstop Delay Damages for each day following the COD Longstop Date until Commercial Operation is reached or this Agreement is otherwise terminated in accordance with Section 6.2(a) and Section 7.4. (iii) Notwithstanding anything else in this Agreement, if Darigold Operations are achieved before COD, then COD shall be extended to March 31, 2025 and the COD Longstop Date shall be extended to September 30, 2025. If Darigold Operations are achieved between COD and the COD Longstop Date, then the COD Longstop Date shall be extended to September 30, 2025. (c) In the event of any damage to the City's Facilities caused by Burnham's acts or omissions or breach of this Agreement, Burnham shall remain 15 506528698.4 obligated to perform all of its obligations under this Agreement and Burnham shall reimburse City for the repair and restoration of the City's Facilities to the same condition as existed immediately before such damage occurred. City shall promptly notify Burnham of any damage to the City's Facilities caused by City's acts or omissions.157.3 7.2 Remedies for Non-Material Breaches of Certain City Obligations. (a) If City fails to timely deliver the Site by the Site Delivery Date in accordance with Section 4.1(a), unless excused by a Force Majeure, such failure shall be a City Caused Delay. (b) If City fails to timely procure the Facility Plan approval under Section 4.1(b), unless excused by a Force Majeure, such failure shall be a City Caused Delay. (c) If the City fails to timely comply with the City Obligations in Sections 4.1(c)through 4.1(�, and such failure results in a Proj ect delay, such failure shall be a City Caused Delay. (d) If City fails to deliver Influent Water in accordance with Exhibit C and Section 4.1(d) or delivers Non-Conforming Influent Water, Burnham shall promptly notify City of such failure and City shall be solely responsible for any and all losses, damage to the System, or additional costs incurred by Burnham that were caused by City's failure or delivery of Non-Conforming Influent Water,including without limitation any additional costs of treating, handling, storing,and disposing of such Non-Conforming Influent Water or discharging Non-Conforming Influent Water to the City-Owned Storage Pond. (e) In the event of any damage to the System caused by City's acts or omissions or breach of this Agreement, City shall remain obligated to perform all of its obligations under this Agreement and City shall reimburse Burnham for the repair and restoration of the System to the same condition as existed immediately before such damage occurred. Burnham shall promptly notify City of any damage to the System caused by City's acts or omissions. 7.3 Remedies for Other Non-Material Breach by Either Party. As promptly as may be reasonably practicable,and unless specified elsewhere in this Agreement no later than thirty (30) business days after becoming aware of a Non-Material Breach, including without limitation Non-Material Breaches specified in Section 7.1 and Section 7.2, the performing Party shall provide written notice of the Non-Material Breach to the non-performing Party ("Claim Notice"}. The failure by the performing Party to give such prompt notice shall not constitute a waiver except to the extent, if any, that the non-performing Party is materially prejudiced by such failure. Except as specified elsewhere in this Agreement, any Claim Notice sent by 16 506528698.4 the performing Party to the non-performing Party shall set forth in reasonable detail, to the extent then known or available: (a) the facts and circumstances giving rise to such Non-Material Breach, including all relevant supporting documentation; (b) the nature of the losses suffered or incurred or expected to be suffered or incurred by the performing Party; (c) a reference to the provisions of this Agreement in respect of which such losses have been suffered or incurred or are expected to be suffered or incurred; (d) the actual amount of losses actually suffered or incurred and, to the extent the losses have not yet been suffered or incurred, a good faith estimate (to the extent reasonably possible, based on the information then known or available) of the amount of losses that could be expected to be suffered or incurred; (e) a reasonably detailed demand for the non-performing Party to take such actions or pay the performing Party any amounts due or reasonably expected to be due to cure the Non-Material Breach (the"Remedy"); and (fl such other information as may be necessary for the non-performing Party to determine whether any limitations under this Agreement may apply. (g) Upon receiving any Claim Notice, the non-performing Party shall perform or pay the Remedy, as applicable, as soon as reasonably practicable,but in any event no later than thirty (30) calendar days. If such Remedy is not reasonably capable of being implemented within thirty (30) calendar days, the Parties shall agree on a longer time to implement the Remedy. If the non-performing Party refuses to comply with the Claim Notice, any disagreements will be resolved by the dispute resolution procedures in Section 15. (h) The Parties agree that a Non-Material Breach will not result in a right for either Party to terminate this Agreement 7.4 Remedies for Material Breach of Either Party (a) Material Breach bv Burnham. If Burnham is in Material Breach of this Agreement, the City may, but is not required to, terminate this Agreement by providing Burnham sixty(60)days advance written notice of termination due to the Material Breach, during which sixty (60) day period Burnham shall have the opportunity to cure such Material Breach. If Burnham fails to " cure and City exercises its termination right, prior to such termination, the City shall elect one of the following: 17 506528698.4 (i) Assumption of Financin�. Subject to Lender(s)' consent, City shall assume the Services under this Agreement and Burnham's obligation to pay the Outstanding Debt pursuant to an agreement between the City and the Lender(s); or (ii) Ri�Pub of First Refusal. Before termination, Lender(s)may choose to liquidate System assets, sell the System at fair market value, or continue to operate the System pursuant to Section 16.5.If Lender(s) choose to liquidate System assets or sell the System, the City shall have a right of first refusal to purchase the System at Fair Market Value as determined in Section 5.5(b)through 5.5(d). The City and Burnham shall execute any agreements or documents necessary to effectuate the City's election of either of the above. If the City assumes the Services under this Agreement, City covenants that it will assume the terms of the RNG Offtake Agreement and RNG Interconnection Agreement, or enter into replacement agreements on materially similar terms and conditions and for the same duration. (b) Material Breach by City. If City is in Material Breach of this Agreement, Burnham may,but is not required to,terminate this Agreement by providing City sixty (60) days advance written notice of termination due to the Material Breach, during which sixty (60) day period City shall have the opportunity to cure such Material Breach. If City fails to cure and Burnham exercises its termination right, City shall owe to Burnham as direct damages, and not as a penalty, the undiscounted value of the City's payments to Burnham for the remainder of the Term (excluding Pass- Through Costs), as reasonably calculated by the Parties using their respective third-party consultants, in accordance with Exhibit F, and any breakage or early termination fees arising from the termination of the RNG Offtake Agreement and RNG Interconnection Agreement. 7.5 Termination of City Lease. If the site lease contemplated in Section 4.1(a) and attached as Exhibit H terminates,this Agreement shall terminate concurrently with the termination of the site lease. If the site lease terminates due to Burnham's material default under the site lease, Burnham shall be considered in Material Breach of this Agreement, with all applicable remedies available to the City under Section 7.4(a). If the site lease terminates due to City's material default under the site lease, City shall be considered ii� Material Breach of this Agreement, with all applicable remedies available to Burnham under Section 7.4(b). 7.6 Liquidated Damages. The Parties acknowledge and agree that with respect to the damages payable under Section 7.1(b), it would be impracticable to determine accurately the extent of the loss the City would have in such case. Therefore, it is in the Parties' interests to establish certainty as to the damages payable. Such damages are in the nature of liquidated damages, do not constitute a penalty, and 18 506528698.4 are a genuine and reasonable pre-estimate of the damages likely to be sustained by the City in such case. 7.7 Good Faith Efforts. In the case of any actual or anticipated breach of this Agreement, each Party agrees to use good faith efforts to take such commercially reasonable actions as necessary to expeditiously resolve the underlying circumstances including without limitation cooperating with the other Party to obtain any new or modified System Permits or other approvals necessary or appropriate in connection with the ownership, occupation; possession or use of the System;provided, however, that in all circumstances neither Party shall be required or be deemed to have waived any defenses it may have under any applicable law or contract. 8. Title, Ownership, and Risk of Loss; Transfer of Environmental Attributes 8.1 City acknowledges that the System at all times during the Term of this Agreement shall be owned by Burnham and will at all times remain Burnham's personal property (and not fixtures), notwithstanding that such System or any part of such System may become attached to the Site or any real property. City shall take no action that is inconsistent with Burnham's ownership of and title to the System and no provision of this Agreement shall be interpreted as giving City any right to operate the System. Burnham may mark or identify the System with labels, plates or other markings showing ownership. All markings and identifications of the System shall include "in partnership with the City of Pasco". Neither City nor Burnham shall not remove any such identifying marks. 8.2 The Parties agree that the transfer of custody of Influent Water to Burnham as contemplated hereunder shall constitute a bailment and that no sale of personal property, waste, or transfer of title to the Influent Water has occurred. City • understands and agrees that, during the period of bailment, the Influent Water will be processed and thereafter will be delivered as Effluent Water in a different form than which it was delivered to Burnham. 8.3 Commencing on COD and continuing until the conveyance of the System to City that will occur at the Term of this Agreement, City assumes the sole risk of condemnation of City's Site and any adverse effects arising from such condemnation. 8.4 City agrees to transfer all title and interest to all carbon credits, greenhouse gas offsets, green tags, renewable energy credits, production tax credits, allowances or offsets for air emissions, "M-RETs," "RINs," "LCFS" credits, or any other local, state, regional, federal, or international environmental programs providing incentives or credits, or any other environmental attributes, however entitled, associated with biogas, RNG, renewable transportation fuels, or other products generated by the anaerobic digestion,processing of organic materials,or otherwise from the Influent Water or operation of the System (collectively, "Environmental Attributes"), including without limitation the ability of the Influent Water, or any 19 506528698.4 portion thereof, to produce RNG and any credits, grants, or incentive payments derived therefrom, to Burnham. Such title and interest transferred from City to Burnham shall include all rights to generate, manage, advertise, claim, promote, and market for sale such Environmental Attributes and RNG. The City shall retain the benefit of all environmental and commercial rights associated with sale of algae. To the extent any emission or other environmental credits, certificates, or similar benefits exist that are not necessary for the production and sale of RNG, and the allocation of such benefits cannot be readily determined pursuant to this Section 8.4, the benefits shall be shared equally between City and Burnham. 8.5 The City agrees to reasonably assist and cooperate with Burnham in securing Environmental Attributes, and otherwise as may be reasonably necessary to carry out the purposes of this Agreement, including from time to time submitting documentation or certifications regarding the Influent Water or the System. 9. Representations and Warranties 9.1 Each Party represents and warrants that it has full power and authority under the laws of the State of Washington to enter into this Agreement. 9.2 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,EACH PARTY MAKES NO WARRANTY OR REPRESENTATION OF ANY KIND WHATSOEVER, EXPRESS OR IMPLIED. ALL IMPLIED WARRANTIES INCLUDING, WITHOUT LIMITATION, WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE ARE HEREBY DISCLAIMED. 10. Indemnification 10.1 Indemnification b Burnham. Burnham agrees that it will indemnify, defend, and hold harmless the City, and its employees, directors, officers, managers, members, and subcontractors (as applicable in the circumstances), (the "City Indemnified Party") from, against, and in all respect of all liabilities,losses,lawsuits,penalties, claims, settlement payments, costs and expenses, interest, awards, judgments, damages,fines or demands(including the costs,expenses and reasonable attorneys' fees on account thereo fl (collectively "Claims") incurred by the City Indemnified Party to third parties arising out of or in connection with (or alleged to arise out of or be in connection with): (a) any personal injury to,or death of, any person,or loss or damage to property arising out of or in connection with the negligence or willful misconduct of Burnham or any of its officers, members, employees, agents, representatives or subcontractors in connection with its obligations or rights under this Agreement; (b) any Burnham Material Breach or Burnham Non-Material Breach; 20 506528698.4 (c) Burnham's acts or omissions under this Agreement that result in an Effluent Water Failure and are the primary cause of a violation of the effluent limitations in the City's Waste Discharge Permit, through no fault or contributory negligence of the City or any third party; (d) any Burnham non-compliance with applicable law, including Environmental Laws; (e) any nuisance condition caused by Burnham's acts or omissions under this Agreement; and (fl any other matter identified as requiring indemnification by Burnham under this Agreement. (g) Burnham shall not, however, be required to reimburse or indemnify any City Indemnified Party for any Claim to the extent any Claim arises from: (i) any City Material Breach or City Non-Material Breach; (ii) the negligence or willful misconduct of any City Indemnified Party; (iii) the City's acts or omissions that cause a violation of the City's Discharge Permit (including the City's supply of Non-Conforming Influent Water or failure to otherwise supply Influent Water in accordance with Exhibit C); (iv) any Abnormal Substances; (v) any Force Majeure event; (vi) any act or omission of any City Indemnified Party responsible for or contributing to the Claim; or (vii) any matter for which the risk has been specifically allocated to the City hereunder. A City Indemnified Party shall promptly notify Burnham of the assertion of any claim against it for which it is entitled to be indemnified hereunder, shall give Burnham the opportunity to defend such claim, and shall not settle the claim without the approval of Burnham which approval shall be in Burnham's sole discretion. These indemnification provisions are for the protection of the City Indemnified Parties only and shall not establish, of themselves, any liability to third parties. The provisions of this subsection 10.1 shall survive termination of this Agreement. 10.2 Indemnification b the Cit . (a) The City agrees that to the extent permitted by law, it will indemnify, defend, and hold harmless Burnham, and its employees, directors, officers, managers, members, shareholders, subsidiaries, and subcontractors (as 21 506528698.4 applicable in the circumstances), (the "Burnham Indemnified Parties") from, against, and in all respect of all Claims incurred by the Burnham Indemnified Party to third parties arising out of or in connection with (or alleged to arise out of or be in connection with): (i) any personal injury to, or death of, any person, or loss or damage to property arising out of the negligence or willful misconduct of City or any of its officers, members, employees, agents, representatives or subcontractors in connection with its obligations or rights under this Agreement, (ii) any City Material Breach or City Non-Material Breach; (iii) the City's acts or omissions that cause a violation of the City's Discharge Permit (including the City's supply of Non-Conforming Influent Water or failure to otherwise supply Influent Water in accordance with Exhibit C or any other failure attributable to City Facilities), through no fault or contributory negligence of Burnham or any third party; (iv) any violation of the fixed dissolved solids effluent limit in the Discharge Permit; (v) any violation of the nitrogen and associated constituent (e.g., nitrates) effluent limits in the Discharge Permit; (vi) any Abnormal Substances; (vii) any soil or groundwater contamination caused by the City's application of Effluent Water to the designated land treatment site via spray irrigation, tl�rough no fault or contributory negligence of Burnham or any third party; (viii) any environmental defect on, under or in the Site on or before the Effective Date of this Agreement or that otherwise arise out of or relate to the City's activities prior to the Effective Date of this Agreement; (ix) any City non-compliance with applicable law, including Environmental Laws; (x) any nuisance condition caused by the City's acts or omissions under this Ageement; and (xi) any other matter identified as requiring indemnification by City under this Agreement. 22 506528698.4 (b) The City shall not, however, be required to reimburse or indemnify any Burnham Indemnified Party for any Claim to the extent any such Claim is due to (i) any Burnham Material Breach or Burnham Non-Material Breach; (ii) the negligence or willful misconduct of any Burnham Indemnified Party; (iii) Burnham's acts or omissions under this Agreement that result in an Effluent Water Failure and are the primary cause of a violation of the effluent limitations in the City's Waste Discharge Permit; provided, however, that the City shall continue to indemnify Burnham for any and all violations of effluent limitations of fixed dissolved solids and nitrogen and associated constituent {e.g., nitrates); (iv) any Force Majeure event; (v) any act or omission of any Burnham Indemnified Party responsible for or contributing to the Claim; or (vi) any matter for which the risk has been specifically allocated to Burnham hereunder. A Burnham Indemnified Party shall promptly notify the City of the assertion of any claim against it for which it is entitled to be indemnified hereunder, shall give the City the opportunity to defend such claim, and shall not settle the claim without the approval of the City which approval shall be in the City's sole discretion.These indemnification provisions are for the protection of the Burnham Indemnified Parties only and shall not establish, of themselves, any liability to third parties. The provisions of this subsection 10.2 shall survive termination of this Agreement. 10.3 Title 51, Revised Code of Washington Waiver. For the purposes of RCW 4.24.115, any Claims by either Indemnified Party where there exists concurrent negligence of(i) the indemnitee or the indemnitee's agents or employees, and (ii) the indemnitor or the indemnitor's agents or employees, such Claims are valid and enforceable only to the extent of the indemnitor's negligence, except as specifically identified elsewhere in this Agreement. For purposes of the indemnities provided pursuant to this Section 10, each Party specifically and expressly waives any immunity that may be granted it under the Washington State Industrial Insurance Act, Title 51 RCW, and all other applicable Industrial Insurance/Worker's Compensation Acts or their equivalent. Further, the indemnification obligations under this Agreement shall not be limited in any way by any limitations on the amount or type of damages, compensation, or benefits payable to or for any third party under Worker's Compensation Acts, Disability Benefits Acts, or other Employee Benefit Acts; provided, this waiver of immunity under this Article extends only to claims against one by the other Party hereto, and does not include, 23 506528698.4 or extend to, any claims by either Party's employees directly against that Party. By initialing below, each Party certifies that the waiver of immunity contained in this Section 10.3 was mutually negotiated. BURNHAM SEV PASCO LLC CITY OF PASCO,WASHINGTON By: By: 11. Limitation of Liability IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY UNDER THIS AGREEMENT OR ANY INDEMNITY OFFERED THEREUNDER FOR ANY SPECIAL, PUNITIVE, EXEMPLARY, SPECULATIVE, INDIRECT, REMOTE OR CONSEQUENTIAL DAMAGES,DAMAGES FOR LOST PROFITS OR DAMAGES BASED ON A MULTIPLE OF EARNINGS OR DIMINUTION IN VALUE OR ANY SIMILAR DAMAGES. 12. Insurance 12.1 Burnham shall maintain, and require each of its subcontractors to maintain, during the construction period before COD, and after COD, in full force and effect for the duration of the Term, insurance with the following coverages and limits: Covera�;e Policv Limits (a) Warker's Compensation Statutory requirements (b) Employer's Liability $2,000,000 each occurrence (c) Comprehensive General Liability, $2,000,000 each occurrence including bodily injury and property damage (d) Auto Liability including bodily injury $1,000,000 each occurrence and property damage (e) Property Insurance(inclusive of Replacement Cost Builders Risk during the construction period before COD, and Physical Damage Coverage after COD) 12.2 Burnham shall provide certificates of insurance evidencing such coverage at such times as City may reasonably from time-to-time request. 24 506528698.4 12.3 City shall maintain in full force and effect at all times during the term of this Agreement insurance with the coverages and limits set forth below: Covera�e Policv Limits (a) Worker's Compensation Statutory requirements (b) Employer's Liability $1,000,000 each occurrence (c) Comprehensive General Liability, $1,000,000 each occurrence including bodily injury and property damage (d) Auto Liability, including bodily injury $1,000,000 each occurrence and property damage 12.4 City shall provide certificates of insurance evidencing such coverage at such times as Burnham may from time to time request. All coverage required by this Agreement shall include a waiver of subrogation. 12.5 The Parties shall meet within sixty(60)days of the fifth(Sth),tenth(l Oth),fifteenth (15th), twentieth(20th), and twenty-fifth(25th) anniversaries of the Effective Date to review the insurance requirements to ensure sufficient coverage under this Agreement. To the extent a Party believes that any insurance coverage is insufficient, the Parties agree to negotiate in good faith to determines appropriate insurance coverage and, if necessary, will modify this Agreement accordingly. 13. Force Majeure 13.1 In the event either Party is rendered unable, wholly or in part, to carry out its respective obligations under this Agreement, except for any obligation to make payment, due to circumstances beyond its reasonable control, including, without limitation, strike,riot,lockouts or other disturbances, flood,natural disaster, acts of God, war or civil insurrection, an epidemic, pandemic, quarantine, national emergency or other unforeseeable circumstances beyond its reasonable control (a "Force Majeure"), then written notice setting out the reason for non-performance shall be given to the other Party by the Party claiming Force Majeure promptly following discovery thereof. Upon receipt of such notice, the obligations of the affected Party shall be suspended during the period of the Force Majeure and any deadline or date certain for performance shall be extended by a period equal to the period of the Force Majeure. Every reasonable effort shall be made by the Parties to avoid delay and limit any period during which performance under this Agreement might be suspended. 14. Confidentiality 14.1 Except as set forth herein, (i) neither Party will disclose Confidential Information of the other Party to any third party, and (ii) each Party will use the other Party's Confidential Information only for purposes of the transactions contemplated by this 25 506528698.4 Agreement; provided, however, that a Party in possession of the other Party's Confidential Information may disclose Confidential Information as required to comply with orders of governmental entities that have jurisdiction over it or as otherwise required by law. 14.2 Each Party agrees to (i) take reasonable steps to protect the other Party's Confidential Information (which steps will be required to be at least as protective as those that the receiving Party takes to protect its own Confidential Information), (ii) notify the other Party promptly upon discovery of any unauthorized use or disclosure of Confidential Information; and (iii) cooperate with the other Party to help regain control of any Confidential Information that is the subject of any such unauthorized use or disclosure and prevent further unauthorized use or disclosure of such Confidential Information. 14.3 Each Party may disclose the other Party's Confidential Information to its subcontractors,agents,legal counsel,accountants,consultants,financing parties,or representatives to the extent necessary in furtherance of this Agreement, and then only on a "need to know" basis in connection with the transactions contemplated hereby and on a confidential basis. 14.4 This Agreement shall be considered a public document and will be available for inspection and copying in accordance with the Public Records Act, chapter 42.56 of the Revised Code of Washington(the"Act"). If Burnham considers any record, in whole or in part, provided to City under this Agreement, whether in electronic or hard copy form, to be protected from disclosure under the Act, Burnham shall make reasonable efforts to clearly identify each such record with words such as "CONFIDENTIAL,""PROPRIETARY"or`BUSINESS SECRET."If a request is made for disclosure of any Burnham Confidential Information, the City shall promptly notify and provide Burnham with a copy of such request. In all cases, the City will ultimately determine whether the requested material should be made available under the Act. If City determines that the material is subject to disclosure, City will notify Burnham of its decision and allow Burnham ten(10)business days to take whatever action it deems necessary to protect its interests. If Burnham fails or neglects to take such action within said period, City will release the record(s) or portions thereof reasonably deemed by City to be subject to disclosure. City shall not be liable to Burnham for inadvertently releasing records pursuant to a disclosure request not clearly identified by Burnham as "CONFIDENTIAL," "PROPRIETARY"or`BUSINESS SECRET." 15. Governing Law and Disputes 15.1 This Agreement shall be interpreted in accordance with the laws of the State of Washington without giving effect to its choice of law principles. 15.2 Any disagreement between Burnham and City which cannot be resolved in accordance with this Agreement shall be referred to the senior management of each Party who shall attempt to resolve the dispute in good faith. To aid resolution by 26 506528698.4 the Parties' senior management, Burnham's and City's representatives shall promptly prepare and exchange memoranda stating the issues in dispute and their positions, summarizing the negotiations which have taken place and attaching relevant documents. If the Parties' senior management resolves the dispute, such resolution shall be reported in writing to and shall be binding upon the Parties. 15.3 If, despite the good faith efforts described in Section 15.2,the Parties are unable to resolve a dispute or claim arising out of or relating to this Agreement or its breach, termination, enforcement, interpretation or validity, the Parties may seek to agree on a forum for mediation to be held at a mutually agreeable site. 15.4 If, despite good faith efforts described in Section 15.2 and 15.3, the Parties are unable to resolve a dispute or claim arising out of or relating to this Agreement or its breach, termination, enfarcement, interpretation or validity, (including the determination of the scope or applicability of this Agreement to arbitrate), shall be determined by arbitration in Seattle, Washington before a single arbitrator who is an experienced attorney in the discipline that is the subject of the dispute and whom shall be jointly selected by Burnham and the City. The arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures. The arbitrator shall issue a reasoned, written decision which will be binding on the Parties. Judgment may be entered upon the arbitrator's decision in any court of competent jurisdiction, and each Party agrees to submit to the personal jurisdiction of any such court for the purposes of any such actions or proceedings to enter or enforce such judgment. 15.5 Should either party employ an attorney to enforce any of the provisions of this Agreement, the non-prevailing Party in any final judgment agrees to pay the other Party's reasonable expenses, including reasonable attorneys' fees and expenses in or out of litigation and, if in litigation, trial, appellate, bankruptcy or other proceedings, expended or incurred in connection therewith, as determined by a court of competent jurisdiction. 15.6 The venue for any judicial proceedings relating to this Agreement shall be the Superior Court for the State of Washington in Franklin County. 16. Miscellaneous 16.1 Amendment and Waiver. No amendment or waiver of any provision of this Agreement shall be valid unless contained within a writing executed by City and Burnham and which references the specific section to be amended or waived. No other amendment or waiver shall have any effect, regardless of its formality, consideration, detrimental reliance or conduct of one or more Parties. Any waiver of any term or condition hereof shall not be construed as a waiver of any subsequent breach or as a subsequent waiver of the same term or condition, or a waiver of any other term or condition of this Agreement. 27 506528698.4 16.2 Assi mment. Either Party, or its assigns as applicable, may assign its rights under this Agreement with the prior consent of the other Party, not to be unreasonably withheld, conditioned or delayed; provided that consent will not be required if Burnham is the assignor and assignment is made to (i) an affiliate of the assigning Party, provided that such affiliate assumes in writing all of the obligations of such assigning Party hereunder; (ii) any person or entity that acquires, directly or indirectly, all or substantially all of the assets of the ultimate parent of such Party (including as a result of a change of control transaction, whether by sale of stock, sale of assets, merger, consolidation or otherwise); and (iii) if Burnham or Burnham's lender is the assignor, the assignee appoints an O&M operator with at least five (5) years of experience operating wastewater treatment plants and demonstrating proficiency operating RNG equipment, or who has a service plan to remotely monitor RNG equipment with experienced RNG technicians. 16.3 Collateral Assi n�nt. Burnham may directly or indirectly collaterally assign, mortgage, or pledge its interests in this Agreement for the purpose of financing the System without City's consent and the City agrees that it shall enter into agreements with the Lender(s} or bond trustee for the Outstanding Debt or any other financing instruments for purposes of any such assignment. 16.4 Counterparts; E-Si natures. This Agreement may be executed by the Parties in any number of counterparts, each of which shall be deemed an original instrument, but all of which together shall constitute but one and the same agreement. A signature of a Party transmitted to the other Party by facsimile,PDF or other electronic means shall constitute the original signature of such Party for all purposes ("Electronic Signature"). 16.5 Lender Right to Cure. If Burnham incurs a Material Breach under this Agreement, the City agrees and acknowledges that Lender(s) may, but do(es) not have the obligation to, (i) acquire title to the System, (ii) cure all defaults and breaches that are capable of cure, and (iii) assume any Burnham Obligation under this Agreement, in which case the City shall recognize such Lender(s} as if such Lender(s)had been the original party to this Agreement. City further agrees to make commercially reasonable efforts to negotiate amendments to this Agreement or otherwise cooperate with the Lender(s) if Lender(s) assume any Burnham Obligations. Nothing in this Section 16.4 will operate to infringe the City's option to purchase the System for FMV under Section 5.5. 16.6 Merger. This Agreement, including any Exhibits, contains the total agreement of the Parties, and all agreements oral or written entered into prior to or contemporaneously with the execution of this Agreement are excluded. This Agreement shall be binding upon the Parties, their successors and assigns. 16.7 Notice.Any notices or other communications required or permitted hereunder shall be in writing and sent to the appropriate addresses designated below (or to such other address or addresses as may hereafter be furnished by one Party to the other Party in compliance with the terms hereo�, by hand delivery, by electronic email 28 506528698.4 (if listed below), by UPS, FedEx, or DHL next-day service, or by registered or certified mail, return receipt requested, postage prepaid. If to City: If to Burnham: City of Pasco Attn: General Counsel Adam Lincoln Burnham SEV Pasco LLC City Manager c/o Burnham RNG LLC 525 N 3rd Avenue 1201 Wilson Blvd—27th Floor Pasco, WA 99301 Arlington VA 22209 With a copy to: With a copy to: Eric Ferguson legal@burnhamdev.com eferguson@kerrlawgroup.net 16.8 No Third-Partv Beneficiaries except Lender �. This Agreement is solely for the benefit of the Parties and their respective successors, Lender(s), and permitted assigns, and nothing herein, express or implied, is intended to or shall confer upon any other person any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement; provided, however, that Burnham's Lender(s) shall have only such third-party beneficiary rights arising from Section 16.4 or as otherwise explicitly granted in the Agreement,and City and Parent shall have such rights and obligations specifically enumerated in Section 3.2. 16.9 Severabilitv. In the event that any clause in this Agreement is deemed unenforceable or invalid, the balance of the Agreement shall remain enforceable. 16.10 No Presumption. The Parties agree that (i) this Agreement was negotiated fairly between them at arm's length and that the final terms of this Agreement are the product of the Parties' negotiations, (ii) this Agreement shall be deemed to have been jointly and equally drafted by them, and(iii)the provisions of this Agreement therefore are not to be construed against either Party on the grounds that such Party drafted or was more responsible for drafting the provisions. 16.11 Eminent Domain.Nothing in this Agreement shall impact City's ability to exercise its eminent domain rights under Chapter 8.12 RWC; provided, however, that any damages or fair market value determined under Chapter 8.12 RWC shall be calculated pursuant to Section 5.5(b) through Section 5.5(e) of this Agreement. [signature page follows] 29 506528698.4 IN WITNESS WHEREOF,the Parties hereto have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date. BURNHAM SEV PASCO LLC CITY OF PASCO,WASHINGTON By: By: Name: Chris Tynan Name: Adam Lincoln Title CEO Title: City Manager Date: Date: 506528698.4 Exhibit A BURNHAM-SUPPLIED SYSTEM The System is composed of the following primary components. Modifications may be made in accordance with Section 5.4 or revisions may be made to accommodate final design: 1. Headworks Svstem: [more detailed description needed—similar to later sections] 2. Anaerobic Di ester S stem and B ass Stations: a. Anaerobic Digester System: a system that holds multiple days of Influent Water at conditions (i.e.,temperature,limited oxygen)that produce biogas (mainly methane and carbon dioxide, other trace gases). The reacted water is then routed to the next process or bypass station. The biogas generated is routed to the gas processing system. b. Bypass -Headworks System to Nitrogen Reduction System: a bypass system where Influent Water is routed from the Headworks System directly to the Nitrogen Reduction System. This system would be used during upset conditions (Anaerobic Digester System/ supporting equipment), or during occurrences when the Influent Water volume exceeds the specification. c. Bypass - Headworks System to City-owned Storage Pond: a bypass system where Influent Water is routed from the Headworks System directly to a City-owned Storage Pond. This system would be used during upset conditions (Anaerobic Digester System /Nitrogen Reduction System / supporting equipment), or during occurrences when the Influent Water exceeds the specification or treatment capacities. 3. Nitro,�en Reduction Svstem and Bypass Station a. Nitrogen Reduction System: a system that is designed to improve levels of the Influent Water characteristics to levels within the effluent specification limits. The reacted water is then routed to the next process. Biosolids and sludge are created during this process. b. Bypass—Nitrogen Reduction System to City-owned Storage Pond: a bypass system where Effluent Water from the Anaerobic Digester System is routed from the discharge of the Anaerobic Digester System around the Nitrogen Reduction System directly to the City-owned Storage Pond. This system would be used during upset conditions (Nitrogen Reduction System / supporting equipment), or during occurrences when the Influent Water volume and/or characteristics are higher than the specification. 4. Gas Processin�: a system that processes the biogas generated from the anaerobic reactors and upgades it to RNG (separating practically all of the methane from the biogas). RNG is then sent to the compression, metering, and the interconnect to gas utility. During upset conditions the biogas is sent to the flare far destruction. 506528698.4 ' 5. Multi-use Buildin�,: a building designed to contain some of the headworks and grit removal system process as well as Motor Control Center, Restrooms, Office, and Maintenance Shop. 6. Influent and Effluent Sampling: a. Sampling of the Influent Water will be established at a location just prior to entering the Headworks System. b. Sampling of the Effluent Water will be established for each discharge source (Anaerobic Digester System and the Nitrogen Reduction System)prior to entering the City-owned Storage Pond or Irrigation Pump System. 506528698.4 Exhibit B BURNHAM OBLIGATIONS Burnham will supply the following wastewater treatment services to the City with respect to the System described in Exhibit A. 1. Operation,Routine Maintenance, and Management of the System. 1.1 Burnham will be responsible for all operations and maintenance obligations required to ensure operation of the System in accordance with the Agreement and Ecology guidance, including without limitation Ecology's Information Manual for Treatment Plant Operators. Burnham shall perform the following Services: a) Day-to-day operations and monitoring for the System; b) Staffing the System sufficient for the operation and maintenance of the System, including with operators certified, as needed, at the appropriate level; c) Performing scheduled routine, preventative, and ongoing maintenance as specified by the equipment manufacturer and consistent with Prudent Industry Practices to ensure the long-term operation of System infrastructure; d) Performing routine maintenance, repairs, and replacements as needed on System components; e) Maintaining operations and routine maintenance records for the supplies needed for System operation and routine maintenance; and fl Ordering and payment for supplies and equipment for routine operations and maintenance of the System. Burnham's payment for supplies and equipment for routine operations and maintenance of the System shall be in accordance with this Agreement and,where appropriate, considered a Pass- Through Cost subject to the terms in Exhibit F. 1.2 Burnham will communicate with the City as is reasonable and necessary regarding Burnham's operation,routine maintenance, and management of the System. 2. Capital Improvements; Major Maintenance; Modifications 2.1 Burnham will perform capital improvements, Major Maintenance and Modifications. 2.2 Annual Major Maintenance Budget. Beginning on April 1 following the first anniversary of COD, and occurring annually on or before April 1 throughout the Term, Burnham will provide the City with a projected annual Major Maintenance budget through 506528698.4 April 1 of the following year, and for each of the next two (2) subsequent years, in accordance with Prudent Industry Practices. The City may object to such budget solely for the purpose of disputing that the projected Major Maintenance is not in accordance with Prudent Industry Practice, within fifteen (15) business days. If the Parties are unable to determine a resolution to any such objection, an independent third-party engineer shall be consulted by the Parties to resolve such objection. If the Parties are unable to agree on a resolution after such consultation,the Parties shall follow the dispute resolution process set forth in Section 15. 2.3 Should Ecology or other applicable regulatory authority establish new or different effluent limits under the Discharge Permit that potentially require Modification(s) to the System,the Parties shall cooperate to evaluate any required Modification(s)to the System. The City shall be responsible for paying for the costs of any such Modifications as provided in Section 5.4 of the Agreement and Exhibit F. 3. State Waste Discharge Permit Compliance, Generally 3.1 The City is responsible for obtaining the Discharge Permit.Both City and Burnham shall be responsible for Permit compliance. 3.2 Relative roles and responsibilities for the City and Burnham to implement and comply with the Permit are defined in the Agreement and this Exhibit B. Burnham's responsibilities for performance standards and regulatory, reporting, and recordkeeping requirements under the Discharge Permit are limited to those set forth in Section 4 of this E�ibit B. 3.3 Burnham's operations will be performed to comply with portions of the City's Discharge Permit relevant to the System and to prevent nuisance conditions. 3.4 Burnham will provide commercially reasonable and necessary support to the City for the Discharge Permit application and renewal processes. 4. Performance Standards and Regulatory, Reporting, and Recordkeeping Requirements 4.1 Burnham's responsibilities for performance standards and regulatory, reporting, and recordkeeping requirements are solely and exclusively for the operation of the System. All aspects of City Facilities, including but not limited to implementation and enforcement of the City's pretreatment program, are the sole and exclusive responsibility of the City and such City Facilities are outside the scope of this Agreement and Burnham's obligation to perform Services and operate the System in accordance with the Agreement. 4.2 Burnham's performance standard responsibilities are set forth in Section 3 of the Agreement; specifically, Burnham shall provide Effluent Water to City in accordance with Exhibit D; provided that Burnham's responsibility for supplying Effluent Water in accordance with Exhibit D is conditioned upon City and processors supplying Influent Water in accordance with Exhibit C. 506528698.4 4.3 Burnham will be responsible for Influent Water and Effluent Water metering/monitoring as more fully described in Section 5 of this Exhibit B; 4.4 For any monitoring and sampling requirements for the System, including monitoring Influent Water to the System and Effluent Water from the System, Burnham will perform any laboratory analysis through an accredited laboratory approved by the City or as otherwise required by the Discharge Permit. 4.5 The City will be responsible for all reporting to Ecology under the Discharge Permit, including any reporting for non-compliance with the Permit. Burnham will be responsible for the provision of any required monitoring and reporting data and information regarding the System to the City, including identifying and reporting to the City any non- compliance or bypasses within the boundaries of the System. 4.6 Burnham will retain a copy of all monitoring reports for the System for a period of three years or for the period of time expressly provided for in the State Waste Discharge Permit's records retention requirements. 4.7 Upon the publication of the draft Discharge Permit, the Parties agree to develop a schedule with Burnham's additional responsibilities for regulatory compliance and reporting and recordkeeping requirements under the Discharge Permit. The Parties agree to amend this Exhibit B to incorporate the schedule prior to issuance of the final Discharge Permit. 5. Metering; Water Quality 5.1 Burnham will install one or more meters as may be necessary to accurately measure the amount and composition of Influent Water delivered by City to Burnham and the amount and composition of Effluent Water delivered to City for purposes of billing City and other monitoring requirements as established in the Discharge Permit. 5.2 Burnham will calibrate, and maintain Meter devices to ensure the accuracy of the measurements is consistent with Prudent Industry Practices, the manufacturer's recommendation, and approved operation and maintenance manual procedures for the device and the waste stream. Burnham will establish the calibration frequency for the Meter(s) in the operation and maintenance manual that conforms to the frequency recommended by the manufacturer. 5.3 Subject to reasonable advance notice,Burnham will provide City with access to the Meter(s) during regular business hours for the purpose of inspecting or monitoring the quantity and quality of Influent Water or Effluent Water. 5.4 City may request periodic testing of any Meter by providing written notice of such request to Burnham. Burnham will conduct such testing;provided that the City may, at its sole cost and expense, hire an independent third-party to conduct such testing. If, during any such testing, the Meter is found to be within a five percent (5%) accuracy range, then the cost of such test shall be borne by the City. If the meter is inaccurate by more than five percent (5%), Burnham shall at Burnham's sole expense, cause the inaccuracy to be 506528698.4 promptly corrected, and the Parties agree that any amounts due or paid for any Services shall be adjusted by the same percentage as the inaccuracy of the Meter, from the date of the City's written request through the date upon which the inaccuracy is corrected, as verified by an independent third-party. 6. Sludge Removal and Disposal 6.1 Burnham will be responsible for removing anaerobic sludge and grit from the System and disposal of such sludge and any associated sludge disposal permits. 6.2 All sludge and grit removal and disposal related to City Facilities will be the sole and exclusive responsibility of the City. 7. System Access and Inspections 7.1 Burnham shall provide Ecology access to conduct inspections of the System during regular business hours to determine compliance with the Discharge Permit. 7.2 Burnham shall provide the City access and the right to conduct inspections of the System and its records during all hours at the City's sole expense and risk following reasonable notice to ensure that the System is being properly maintained in accordance with the Agreement and this Exhibit B. 8. Payment of Permit Fees and Fines S.1 The City is responsible for all Discharge Permit fees. 8.2 If Ecology assesses any fines or penalties under the Discharge Permit as a result of an Effluent Water Failure caused primarily by Burnham, or Burnham's failure to provide the City with required reporting information regarding the performance of the System, Burnham shall indemnify City under Section 10.1 of the Agreement. 9. System Maintenance 9.1 City acknowledges that each and all of Burnham's Obligations under Section 3 of the Agreement and this Exhibit B are subject to and conditioned upon Burnham's right and obligation to perform on the System routine and periodic maintenance, emergency maintenance, and any maintenance necessary to correct anomalies or unanticipated conditions as reasonably required from time to time. In such circumstances, Burnham may direct Influent Water to City-Owned Storage Pond and the volume of Influent Water shall be metered and have the ability to be sampled for laboratory testing. 9.2 Burnham shall provide City with advance notice of any routine and periodic maintenance activities that require the system to be offline within ten(10)calendar days of the commencement of such routine and periodic maintenance activities. 506528698.4 9.3 Burnham may perform emergency maintenance activities as reasonably required under the circumstances. In the case of emergency maintenance activities, Burnham shall provide notice to City as soon as practicable. 10. Indemnification Burnham's sole and exclusive responsibility for wastewater treatment services to the City with respect to the System is limited to the services in this Exhibit B. Consistent with the indemnification provisions in Section 10 of the Agreement, the City will indemnify, defend, and hold harmless Burnham against any Claims unrelated to Burnham's services set forth in this Exhibit B. 506528698.4 Exhibit C CITY OBLIGATIONS City shall supply the Site for the System, as more particularly described below: Site Description: That parcel of land being a portion of The South Half of the Northwest Quarter of Section 4, Township 9 North, Range 30 East, W.M., records of Franklin County, Washington, described as follows: Beginning at the Southwest corner of said South Half; thence North 03°06'31" East along the West line of said South Half, 119.99 feet to the True Point of Beginning; thence continuing North 03°06'31" East along said West line 1256.65 feet to the Northwest corner of said South Half; thence North 88°53'S7" East along the North line of said South Half, 1305.39 feet; thence South 00°02'45" West, 1131.07 feet; thence South 88°53'39" West,413.99 feet; thence South 00°00'00" East, 120.00 feet; thence South 88°45'20" West, 958.71 feet to the True Point of Beginning. Also Known as Lot 1 of Record Survey recorded under Auditor's File No. 1969537. Parcel No. 113090085 Access: Burnham, including Burnham visitors, contractors, and service providers, shall have unencumbered access to the Site and all associated easements and rights-of-way. Access to the site is exclusive, subject to certain easements and other access rights granted in favor of City as identified in the site lease. Utilities: 1. Power: a. City to provide adequately sized underground raceway/conduit to Site boundary. b. Burnham responsible to coordinate with utility provider to provide power through City raceway to facility. 2. Communications: a. City to provide adequately sized underground raceway/conduit to Site boundary. b. Burnham responsible to coordinate with communications provider to provide communications through City raceway to facility. 506528698.4 3. Potable Water: City to provide adequate water source (for use: domestic, fire, and process w/in facility) at Site boundary. Burnham responsible to coordinate with the City to provide potable water through City waterline to Project. 4. Effluent Water Disposal: City to provide disposal with connection piping at Site boundary. 5. Influent Water Supply: City to provide supply with connection piping at Site boundary. City shall supply Influent Water with flows, constituent concentrations, and loads that are within ten percent (10%) of the following values: Influent Characteristics to Wastewater Treatment System Parameter Influent Avg.Annual Daily Flow(MGD) 4.38 Max.28-Day Flow(MGD) 8.56 Max.Instantaneous Flow(GPM) 9,200 BOD,Annual Avg. (mg/L) 3,590 BOD,Annual Avg.Daily Load(lb/d) 131,035 BOD,Load Max.28-Day(lb/d) 300,000 TSS,Annual Avg. (mg/L) 2,140 TSS,Annual Avg.Daily Load(lb/d) 78,170 TSS,Load MaJc.28-Day(lb/d) 227,885 TN,Annual Avg. (mg/L) 114 TN,Annual Avg.Daily Load(lb/d) 4,170 TN,Load Max.28-Day(lb/d) 8,140 Temperature Range(°F) 50-95 Ph 4-10 506528698.4 Exhibit D BURNHAM-SUPPLIED EFFLUENT WATER Burnham shall supply Effluent Water in accordance with the following specifications,which in all cases shall be conditioned upon City providing Burnham with Influent Water in accordance with the City's Obligations in Exhibit C and the conditions in this Exhibit D. Anaerobic Digester System Effluent Discharge Quality Requirements Parameter Design Value3 BOD. Avg. (mg/L) <350 The System is designed and intended to bypass Influent Water around portions of the process based on the System capacities and Influent Water characteristics as described below: a) Influent Water flows above the Max. 28-Day Flow (MGD) and Max. Instantaneous Flow (GPM), as stated in Exhibit C, will typically bypass the Anaerobic Digester System. When Influent Water flows are below this threshold, Burnham will typically send materially all Influent Water through the Anaerobic Digester System. b) The Nitrogen Reduction System will typically be bypassed when Influent Water flows are above 4 MGD. When flows are below 4 MGD, Burnham will typically send materially all Effluent Water from the Anaerobic Digester System to the Nitrogen Reduction System. When flows are above 4 MGD, a portion of the Effluent Water from the Anaerobic Digester System will bypass the Nitrogen Reduction System and be directed to the City-owned Storage Pond. 3 Based on 28-day average, as measured on BVF reactor system effluent. 506528698.4 Exhibit E DEFINITIONS "Abnormal Substances" means substances or materials (including viscous, toxic or hazardous substances) that, based on the basis of design provided by City, (i) could not be reasonably anticipated by Burnham as being in the Influent Water, (ii) are present in the Influent Water in a type, concentration or loading that could not be reasonably anticipated by Burnham;or(iii)exceed the design capacity of the System to adequately treat when operated in accordance with Prudent Industry Practices. "Adjusted Treatment Fee"has the meaning given in Exhibit F. "Base Treatment Fee"has the meaning given in Exhibit F. "Burnham Indemnified Parties"has the meaning given in Section 10.2(a). `Burnham Obligation(s)"has the meaning given in Section 3.1. "Claim Notice"has the meaning given in Section 7.3. "Change of Law" means after the Effective Date (i) the enactment, adoption, promulgation, modification or repeal of any law or regulation applicable to the System or the production or sale of RNG;(ii)the imposition of any material conditions on the issuance or renewal of any applicable Permit (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 by any governmental authority that establishes requirements affecting owning, supplying, constructing, installing, operating or maintaining the System, or other performance of the obligations of either Party hereunder. "Changed Circumstances"has the meaning given in Section 4.2. "City Caused Delay"means any Project delay arising from the City's failure to comply with the terms and conditions of this Agreement or any City act or failure to act that interferes with Burnham's obligations under this Agreement and results in a Project delay, excluding any material and clearly identified delays caused by any third-party that is not under the reasonable control of City and excluding any City act or failure to act pursuant to its generally applicable municipal responsibilities. Any City Caused Delay shall extend the COD Longstop Date on a day-for-day basis until such City Caused Delay is resolved, and the City shall be responsible for any and all reasonable, documented losses or additional costs attributable to such City Caused Delay as set forth in Exhibit F. "City Facilities"has the meaning given in the RECITALS. "City Indemnified Parties"has the meaning given in Section 10.1. "City Obligation(s)"has the meaning given in Section 4.1. 506528698.4 "City Permits" means the Permits that must be obtained and maintained by City as set forth in Exhibit G. "Claims"has the meaning given in Section 10.1. "Commercial Operation"means the date that a Certificate of Substantial Completion or similar certification is issued in accordance with the Progressive Design Build Agreement, as verified by a third-party engineer. "COD"means the actual date upon which the System reaches Commercial Operation. "COD Longstop Date"has the meaning given in Section 3.1(c). "COD Delay Damages"means $5,000 per day. "COD Longstop Delay Damages"means $10,000 per day. "Confidential Information"means any non-public information,know-how or trade secrets in any form that is designated"confidential"or that a reasonable person should understand is confidential. The following information does not constitute Confidential Information: (i) information that is or becomes generally available to the public other than as a result of a disclosure by either Party in violation of this Agreement, (ii) information that was already known by either Party on a non- confidential basis prior to this Agreement, (iii) information that becomes available to either Party on a non-confidential basis from a source other than the other Party if such source was not subject to any prohibition against disclosing the information to such Party, (iv) information required to be disclosed pursuant to a valid public records request under RCW 42.56; and(v) information that is independently developed by a Party without violating its obligations under this Agreement. "Consumer Price Index" means the United States Deparhnent of Labor's Bureau of Labor Statistics Consumer Price Index, All Urban Consumers, All Items, West Region, (1982-84 equals 100), or the successor of such index. "Darigold �perations"means that, to Burnham and City's reasonable satisfaction, the System is able to accept and treat Influent Water from Darigold Inc.before reaching Commercial Operation. "Discharge Permit"has the meaning given in the RECITALS. "Ecology"has the meaning given in the RECITALS. "Ecology Delay"has the meaning given in Section 4.1(b). "Effective Date"has the meaning given in the introduction to the Agreement. "Effluent Water"means wastewater, as measured at the Pond Discharge Station from which the wastewater from the Burnham Supplied Processes enter and is returned to the City as more particularly described in Exhibit A, that meets the specifications in Exhibit D. "Effluent Water Failure"has the meaning given in Section 7.1. 506528698.4 "Environmental Attributes"has the meaning given in Section 8.4. "Environmental Laws"means (a) the Comprehensive Environmental Response, Compensation, and Liability Act,42 U.S.C. 9601 et seq. ("CERCLA");the Emergency Planning and Community Right to Know Act, 42 U.S.C. 11001 et seq.; the Resource Conservation and Recovery Act, 42 U.S.C. 6901 et seq. ("RCRA"); the Safe Drinking Water Act, 42 U.S.C. 300f et seq.; the Toxic Substances Control Act, 15 U.S.C. 2601 et seq.; the Federal Water Pollution Control Act, 33 U.S.C. Sections 1251 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. 2701 et seq.; the Clean Air Act, 42 U.S.C. 7401 et seq.; and the Occupational Safety and Health Act, 29 U.S.C. 651 et seq.; and the regulations promulgated pursuant to the above-listed federal statutes, as amended from time to time; and (b) counterpart state laws and regulations of each item listed in subsection (a) above, as amended from time to time. "Facility Plan" is the facility plan and process water reuse facility engineering report approved by Ecology. "Fair Market Value"or"FMV"has the meaning given in Section 5.5. "Gross Wen Process Performance Guarantees"has the meaning given in Section 3.1(i). "Gross Wen Process"means an algae-based nitrogen reduction process. "Influent Water"means all agricultural and milk processing industrial wastewater that does not contain industrial wastewater in excess of applicable federal and state industrial pre-treatment standards, does not contain Abnormal Substances, and otherwise meets the specifications in Exhibit C, as measured at the point at which the Influent Water is delivered to Burnham as more particularly described in Exhibit A, whether owned or under the control Citv or processors. "Initial Term"has the meaning given in Section 2.1. "Insolvency Event"means with respect to any Party, when: (a)the Party commences a voluntary case or other proceeding seeking liquidation,reorganization or other relief with respect to itself or its debts under any bankruptcy, insolvency, reorganization or other similar law of any jurisdiction now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of such Party or any substantial part of its property, or consents or agrees to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against it, or makes a general assignment for the benefit of creditors, or becomes or is declared insolvent, or acknowledges, in writing, its inability to pay its debts as they become due, or takes any corporate action in any jurisdiction to authorize any of the foregoing; (b) an involuntary case or other proceeding is commenced against the Party seeking liquidation, reorganization or other relief with respect to it or its debts under any bankruptcy, insolvency,reorganization or other similar law of any jurisdiction now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of such person or any substantial part of its property, and such involuntary case or other proceeding shall remain undismissed and unstayed for a period of ninety(90)days; or(c) an order for relief has been entered against that Party under the United States federal, state or other bankruptcy laws of any jurisdiction as now or hereafter in effect. 506528698.4 "Late Payment Rate"has the meaning given in Section 5.3. "Lender(s)" means any third-party lender or financing party providing financing in connection with this Agreement. "Major Maintenance" means repairs and maintenance associated with maintaining System performance consistent with the obligations of this Agreement and consistent with Prudent Industry Practice, including without limitation maintenance, repair, renewal, capital expenditures, reconstruction or replacement of any portion or component of the System, as applicable, of a type that is not normally included as ordinary or routine maintenance and the total cost of such activities exceeds$25,000, as adjusted annually for any change in the Consumer Price Index occurring from January 1 through December 31 of the prior calendar year "Major Maintenance Expenses" means all costs, fees, obligations and other liabilities incurred by Burnham associated with Major Maintenance or replenishing the Major Maintenance Reserve. "Major Maintenance Reserve"means amounts required by Lender(s)to be held in a reserve fund to cover the System's major maintenance costs. "Material Breach"has the meaning given in Section 6.2. "MG"means million gallon(s), as defined in the RECITALS. "Modifications"has the meaning given in Section 5.4. "Net Capital Costs" means actual costs incurred or payable by Burnham or its affiliates in connection with the development, construction and completion of the System, excluding (i) working capital required for System start-up and financing costs, and (ii) costs attributable to any City Caused Delay or Ecology Delay;. Net Capital Costs will be reduced by the amount of two million dollars ($2,000,000.00). � "Net RNG Revenue"means all revenue received from the sale of RNG less any operating costs or other costs associated with the sale of RNG (compression, consumables, electricity, marketing expenses, etc.). "Non-Conforming Influent Water" means agricultural and milk processing industrial wastewater delivered or directed by City to the System that fails to meet in any respect or for whatever reason the specifications in Exhibit C. "Non-Material Breach"has the meaning given in Section 6.1. "Notice to Proceed"or"NTP"means the notice that Burnham has provided, in its sole discretion, to the engineering and procurement contractor to begin procurement and commence construction activity at the Site, a copy of which Burnham will promptly provide to the City. "NTP Date"has the meaning given in Section 3.1(b). "NTP Longstop Date"has the meaning given in Section 3.1(b). 506528698.4 "Outstanding DebY'means at the relevant time,the fully amortized aggregate of(without double- counting): all outstanding principal, interest (including default interest to the extent that borrower incurs default interest arising as a result of the City making any payment later than the date that such payment is due under this Agreement, or incurred by borrower due to any other default by the City under this Agreement), banking fees and premiums on financial insurance policies, agent and trustee fees, costs and expenses and other amounts properly incurred owing or outstanding to the Lender(s) by Burnham under or pursuant to its agreement with the Lender(s), including any prepayment costs, make-whole amounts and breakage costs. "Pass-Through Costs"has the meaning given in Exhibit F. "Permits" means the permits, licenses, certificates, clearances, approvals, authorizations, variances, or consents of any governmental authority, department, or agency, including all amendments thereto and replacements thereof, that must be obtained and/or maintained for construction and operation System. "Prevailing Wage Costs"means the costs incurred by Burnham to comply with Section 3.1(j). "Progressive Design Build Agreement"means the Progressive Design Build Agreement signed between Burnham and Swinerton Builders, Inc. dated October 28, 2022 or any similar agreement signed by Burnham to construct the System. "Prudent Industry Practices" means any of the practices, methods and acts engaged in or approved by a significant portion of the wastewater treatment industry for facilities of similar size and characteristics to the System or any of the practices,methods or acts, which, in the exercise of reasonable judgment in the light of the facts known or that should reasonably have been known at the time a decision is made,could have been expected to accomplish the desired result at the lowest reasonable cost consistent with law, regulation, permits, codes, standards, equipment manufacturer's recommendations, reliability, safety, environmental protection, economy, and expedition. "PWRF"has the meaning given in the RECITALS. "Remedy"has the meaning given in Section 7.3(e) "Renewable Natural Gas" or "RNG" means biomethane produced by the System that meets natural gas pipeline-quality standards such that the biomethane may blend with, or substitute for, geologic natural gas. "Renewal Term"has the meaning given in Section 2.2. "RNG Credit"has the meaning given in Exhibit F. "RNG Interconnection Agreement" means that certain RNG Facilities Interconnect Agreement anticipated to be executed between Burnham and Cascade Natural Gas Corporation. 506528698.4 "RNG Offtake Agreement" means that certain North American Energy Standard Board master agreement, Transaction Confirtnation, and Special Provisions, anticipated to be executed between Burnham and Cascade Natural Gas Corporation. "Services"means the services to be provided by Burnham, its subcontractors, agents, or assigns, under this Agreement, as set forth in Exhibit B. "Site"has the meaning given in Section 4.1(a). "Site Delivery Date"has the meaning given in Section 4.1(a). "System" means the Burnham-supplied wastewater treatment and RNG production facility and ancillary components as set forth in Exhibit A. "System Permits"means City Permits or Burnham Permits, as applicable. "Term"has the meaning given in Section 2.2. "Work Acceleration Agreements"has the meaning given in the Recitals. 506528698.4 Exhibit F PRICING SCHEDULE Base Treatment Fee: [$1,125,000]4 per month Adjusted Treatment Fee: 1. Within thirty(30) calendar days of COD, Burnham shall provide the City with an invoice for the first adjusted Base Treatment fee (the "Adjusted Treatment Fee"), which shall be calculated by Burnham as follows, provided that the total amount of any increase in the Adjusted Treatment Fee for items a, b, c, and d below (and excluding e) may not exceed $170,000 per month(the"Adjusted Treatment Fee Cap"): a. If the Net Capital Cost exceeds$132,000,000,the Base Treatment Fee will be increased in increments of$9,000 per month for each $1,000,000 of increased costs (rounded to the nearest million). b. If the Net Capital Cost is less than $132,000,000, the Base Treatment Fee will be decreased in increments of$9,000 per month for each $1,000,000 of decreased costs (rounded to the nearest million). c. The Base Treatment Fee assumes that the System is financed with senior debt at a total weighted-average cost of debt at 6.5%. For clarity, all debt calculations include only debt incurred by Burnham and do not include any debt at any Burnham affiliates, including without limitation Burnham's parent company. i. For every 10 basis points (bps) above a total weighted-average cost of debt of 6.5%, the Base Treatment Fee will be increased by $5,250. ii. For every 10 bps below a total weighted-average cost of debt of 6.5%,the Base Treatment Fee will be decreased by$5,250. d. The Base Treatment Fee will be decreased by $9,000 per month for each $1,000,000 (rounded to the nearest million) for any payments City makes to Burnham under the Work Acceleration Agreements. e. The Base Treatment Fee will be increased by $9,000 per month for each $1,000,000 (rounded to the nearest million) of costs attributable to City Caused Delays or an Ecology Delay. 4 NTD: Subject to fully executing agreement by April 10. 506528698.4 Annual Modifications to the Adjusted Treatment Fee The Adjusted Treatment Fee will be subject to further modification as follows: 1. Commencing on COD, Burnham will modify the Adjusted Treatment Fee to reflect any percentage adjustment in the Consumer Price Index measured from April 2022 to the month and year immediately preceding the month and year in which COD occurs. This first modification of the Adjusted Treatment Fee will be the Adjusted Treatment Fee calculated and invoiced by Burnham through March 31 of the first calendar year occurring after the calendar year in which COD occurs. 2. Commencing on April 1 of the first calendar year following the year in which COD occurs, and occurring annually on April 1 of each calendar year through the Term, Burnham shall modify the Adjusted Treatment Fee based on changes in the Consumer Price Index and/ar increases in the amount of Influent Water or Non-Conforming Influent Water accepted by the System that occurred during the immediately preceding calendar year(e.g., a modified Adjusted Treatment Fee will be calculated and take effect on April 1, 2025 to reflect circumstances occurring from January 1,2024 through December 31,2024). Burnham will calculate such annual modifications to Adjusted Treatment Fee as follows: a. The then-current Adjusted Treatment Fee will be adjusted for any change in the Consumer Price Index occurring from January 1 through December 31 of the prior calendar year;provided, however, that on April 1 of the first calendar year occurring after COD, such Consumer Price Index adjustment shall be measured from the month COD occurred through December 31 of the prior year(e.g.,if COD occurs Jun 1,2024, the adjustment will be measured from June 1, 2024 through December 31, 2024); and b. If the System accepted more than 1,600 MG of Influent Water or Non-Conforming Influent Water during the prior calendar year, the Adjusted Treatment Fee will be increased by .03% per MG for each MG accepted above 1,600 MG. There will be no adjustment for volume of water if the total volume of Influent Water or Non- Conforming Influent Water is less than 1,600 MG. Such annually modified Adjusted Treatment Fee shall remain fixed for the next twelve (12) months,through March 31 of the subsequent year. Burnham shall document any annual modifications to the Adjusted Treatment Fee and provide City a form summarizing the annual modification to the Adjusted Treatment Fee with the first invoice issued after such modified Adjusted Treatment Fee goes into effect. Pass-Through Costs: The following costs incurred by Burnham will be passed through to City with a ten-percent(10%) markup for administrative costs, and will be invoiced to the City on a monthly basis: o Solid waste disposal (including anaerobic sludge; periodic digester scrapes and clean-outs and any algae or biomass removed from the Gross Wen Process) o Consumables (including replacement parts & associated rental equipment) 506528698.4 o Major Maintenance Expenses The following costs incurred by Burnham will be passed through to City with no markup for administrative costs, and will be invoiced to the City on a monthly basis: o Electricity o Purchased natural gas for system heating use o All City, state, and local taxes with the exception of income taxes (e.g., sales tax, B&O tax, property tax, as applicable) o Rental payments made to City under the site lease o Any costs and fees associated with securing and maintaining a Service Contract Performance Bond RNG Credit. Burnham includes in the Base Treatment Fee an RNG credit of$350,000 per month. Burnham shall reduce or increase all invoiced amounts to City by the changed amount of any RNG Credit, if any, available for the applicable invoiced month. The RNG Credit changed amount will be the amount greater than or less than $350,000 (as adjusted for 50% of change in Consumer Price Index from Apri12022) that Burnham earns in Net RNG Revenue in the previous month. If Burnham's Net RNG Revenue is greater than $350,000, the City's invoiced amount will be reduced by the amount that the Net RNG Revenue exceeds $350,000. If the Burnham's Net RNG Revenue is less than $350,000, the City's invoiced amount will increase by the amount that the Net RNG Revenue is below $350,000. 506528698.4 Exhibit G SYSTEM PERMITS Citv Permits City will procure and maintain, as necessary, the following Permits far the System (the "City Permits"): Permit Name Permit Type Agency State Wastewater Discharge water Ecology Permit Burnham Permits Burnham will procure and maintain, as necessary, the following Permits for the System (the `Burnham Permits"): Permit Name Permit Type Agency Notice of Construction Air Ecology SEPA Review General Franklin Co. Conditional Use(CUP) Use Franklin Co. Industrial Storm Water Water Ecology Solid Waste Permit (If waste Ecolo Necessary) � Dam Safety (If Necessary) Water Ecology 506528698.4 Exhibit H FORM OF SITE LEASE 506528698.4 Basic Terms Summary of the Lease Agreement between Burnham SEV Pasco LLC and the City of Pasco dated �] The following table contains a summary of the basic terms of the Lease Agreement(`Basic Terms Summary") for indicative purposes only and is not intended to be binding on the parties thereto. The provisions and terms summarized in the Basic Terms Summary are more specifically described and defined in the Lease Agreement. In the event of any conflict or inconsistency between the Basic Terms Summary and the Lease Agreement, the terms of the Lease Agreement will govern. Lessor City of Pasco Lessor's Address 525 N 3rd Avenue Pasco, WA 99301 Lessee Burnham SEV Pasco LLC Lessee's Address 1201 Wilson Blvd—27th Floor Arlin ton, VA 22209 Lessor Property The 82.95 acres of land owned by Lessor,as described in E�iibit B to the Lease A reement, which includes the land to be leased b Lessee. Leased Property The 37.33 acres of land owned by Lessor,as described in Exhibit C to the Lease A reement, to be leased b Lessee. Opening Term Lessee will pay Lessor$25,200.00 annually during the Opening Term. Pa ment Initial Term Lessee will pay Lessor $25,200.00 annually during the Initial Term and Payment an Renewal Term. Opening Term The Opening Term will commence on the Agreement Date and continue until the earlier to occur of(a) the COD and (b) the COD Longstop date, unless terminated pursuant to the terms of this Lease Agreement. If COD does not occur within one hundred eighty (180) days after the COD Longstop date(i.e.,the COD does not occur),then this Lease Agreement shall terminate at the end of the O enin Term. Initial Term The Initial Term will commence on the COD and continue for thirty(30) ears. Renewal Terms Term will automatically renew for two (2) additional five-year Renewal Terms. 506528698.4 LEASE AGREEMENT THIS LEASE AGREEMENT (this "Agreement") is entered into by BURNHAM SEV PASCO LLC, a Washington limited liability company ("Lessee") and the CITY OF PASCO, a municipal corporation of the State of Washington("Lessor"and collectively with Lessee,the"Parties"or, as the context requires, "Party") and is effective as of the date this Agreement has been last signed by a Party (the"Agreement Date"). In consideration of the mutual promises contained l�erein,the Parties, intending to be legally bound, agree as follows: RECITALS This Agreement is made with reference to the following facts: A. Lessor and Lessee intend to enter, or have entered, into the Wastewater Treatment Agreement (the"WTA") a copy of which is attached hereto as Exhibit E and incorporated herein by this reference. Pursuant to the terms thereof, Lessor desires to contract with Lessee to develop, design, construct, and operate, a wastewater treatment system (the "System"} in Pasco, Washington, as more particularly described in the WTA; and B. As a condition to Lessee's agreement to enter into the WTA with Lessor, Lessor has agreed to enter into this Agreement and, among other things, grant to Lessee sufficient leasehold and appurtenant rights and privileges necessary for Lessee to construct, operate, and maintain the System, upon the terms and conditions set forth in this Agreement. NOW THEREFORE, in consideration of the foregoing and the WTA, the receipt and sufficiency of which are hereby acknowledge, the parties hereby agree as follows: ARTICLE 1 : Term 1.1 The initial term of this Agreement shall begin on the Agreement Date and shall continue until the earlier to occur of(a) the COD and (b) the COD Longstop date, in each case unless this Agreement is earlier terminated in accordance with its terms (such initial term is hereinafter referred to as the"Opening Term"). 1.2 During the Opening Term, Lessee may, in its sole discretion, terminate this Agreement (a} effective upon thirty (30) days' notice to Lessor, (b) on the NTP Longstop Date in the event Lessee does not issue NTP by the NTP Longstop Date, or(c) if the WTA is no longer in full force and effect following the Effective Date of the WTA. If the COD does not occur within one hundred eighty (180) days after the COD Longstop date (i.e., the COD does not occur), then this Agreement shall terminate at the end of the Opening Term. 1.3 On the COD, an additional term of this Agreement shall commence and shall continue, unless earlier terminated in accordance with the provisions of this Agreement, for a period of thirty (30) years following the COD (the"Initial Term"). 506528698.4 1.4 The Initial Term shall automatically renew for two (2)additional five(5)year terms (each such additional term, a "Renewal Term") unless terminated by Lessee by written notice delivered to Lessor at least one hundred and eighty(180) days prior to the expiration of the Initial Term or the then-current Renewal Term, as applicable, consistent with the terms and conditions hereof. ARTICLE 2 : Lease; Easement 2.1 Lessor hereby grants to Lessee and Lessee hereby leases from Lessor, for the Term, an exclusive and irrevocable right to access and use the Leased Property, together with the rights and privileges appurtenant thereto, in accordance with this Agreement. ' (a) Lessor hereby grants to Lessee and Lessee's employees, members, managers, affiliates, invitees, agents, contractors and subcontractors (collectively, "Representatives"} and those of their affiliates(collectively, "Lessee Parties"), irrevocably for the duration of the Term, an access easement and right of way over, across, under and through the Lessor Property, and (subject to Lessor's approval, not to be unreasonably withheld) any surrounding or nearby premises owned by Lessor, in order for Lessee Parties to access the Leased Property and to build, maintain, and install any road, improvements, equipment, fences, gates, signs, communication lines or facilities, pipelines, or anything else reasonably necessary for the System Activities (as defined below) (collectively, "Lessee Improvements"). (b) Lessor shall provide the Lessee Parties with all access to the Leased Property necessary to allow Lessee to perform all System Activities, including ingress and egress rights through the Lessor Property, any third-party owned neighboring properties necessary to access the Lessor Property, and within the Leased Property, for Lessee and the Lessee Parties to access the System and Lessee Improvements. Without limiting the foregoing,to the extent Lessor has any beneficial easement rights in favor of or necessary to access the Leased Property, Lessor shall provide that Lessee has the right to utilize any such beneficial easements. (c) Lessor shall use its commercially reasonable efforts to provide sufficient space for: temporary storage and staging of equipment;parking of construction crew vehicles and temporary construction trailers; rigging and material handling; and for all other facilities reasonably necessary during the System Activities. (d) Lessor and its authorized representatives shall at all times have access to and the right to observe the installation work, subject to compliance with Lessee's safety rules and Prudent Industry Practices,but shall not interfere with the System Activities or handle any Lessee equipment or the System without written authorization from Lessee. 2.2 Without limitation to Lessee's other rights under this Agreement, Lessor agrees to use its best efforts to cure any defect in, or objection Lessee provides in writing to Lessor regarding, any Existing Lien or any other Lien encumbering or affecting the Leased Property or Lessee's rights in relation thereto. 506528698.4 ARTICLE 3 : Payment 3.1 Openin� Term Pa.�. During the Opening Term, the rent payable by Lessee to Lessor shall be $25,200.00 annually ("Term Payment"), subject to adjustments, if any, set forth below. The Opening Term Payment shall be paid annually. The first payment of Opening Term Payment shall be paid to Lessor within thirty (30) days after the Agreement Date. Each Opening Term Payment thereafter shall be due annually within thirty (30) days of Lessor's written notice to Lessee. 3.2 Initial Term Pa.vment. During the Initial Term and any Renewal Term, the rent payable by Lessee to Lessor shall be$25,200.00 annually("Initial Term Payment"and collectively with the Opening Term Payment, "Rent"). The Initial Term Payment shall be paid annually to Lessor with the first such annual Initial Term Payment to be paid within thirty(30)days of Lessor's written notice to Lessee, provided such notice occurs after the COD. Each subsequent payment shall be due annually within thirty(30)days of Lessor's Written Notice to Lessee during the Initial Term and any Renewal Term. 3.3 Additional Rent Terms. Lessor acknowledges and agrees that the Rent is the only rent or fee Lessee shall be obligated to pay Lessor in connection with this Agreement. Rent shall be offset against any amounts due and payable to Lessee pursuant to the WTA or otherwise paid by another method agreed by the Parties in writing. ARTICLE 4 : Taxes 4.1 Lessee shall pay all applicable personal property Taxes on the System and any applicable leasehold excise Taxes in respect of the Leased Property. Lessee shall not be liable for any real property Taxes during the Term levied against the Leased Property. Unless prohibited by Applicable Law, Lessee shall not be responsible for any Taxes imposed on the income of the Lessor derived from the Leased Property or otherwise. 4.2 If a Party fails to pay directly, or reimburse the other Party for, Taxes for which the first Party is responsible under this Agreement, the other Party may in its sole discretion elect to pay the same directly to the taxing authority and in such event shall be entitled to recover such amount from the first Party with interest thereon at a rate equal to the lower of(a) one and a half percent (1.5%) per month or (b) the highest rate permitted under Applicable Law. Lessee may offset against any amounts owing to Lessor hereunder any Taxes paid by Lessee pursuant to this Section 4.2 for which Lessor is responsible. ARTICLE 5 : System 5.1 Svstem Activities. Lessor agrees to allow Lessee and the other Lessee Parties, throughout the Term, to develop, engineer, design, construct, install, interconnect, operate, maintain, monitor, clean, repair, replace, and remove the System in its entirety or any component thereof and engage in such other activities as are for the benefit thereof or purpose incidental thereto (such development, construction and other activities collectively, "System Activities") on and from the Leased Property.Lessor acknowledges that the System Activities will or may require, among other things, physical installation of the System on the Leased Property, delivery of feedstock to the 5ystem, and transport of RNG from the Leased Property by pipeline or vehicle, 506528698.4 and Lessor consents to such physical installation,delivery,transport and any other lawful activities relating to the System. Without limiting the foregoing, Lessee shall have the right to alter,modify, relocate, or remove any structures as may exist on the Leased Property as of the Agreement Date. 5.2 Permits and Incentives. Each Party shall obtain and maintain certain Permits as required under the WTA. In the event the WTA terminates,each Party shall maintain such Permits as reasonably required by Applicable Law. 5.3 Utilities and Water. Lessee shall be responsible for payment for any upgrades to existing utility systems that Lessee deems necessary for the System Activities that do not constitute Major Maintenance Expenses. Lessor shall cooperate in good faith with Lessee in Lessee's efforts to obtain utility services to and from the Leased Property including any necessary easements on adjacent property. Lessor shall be responsible for Pass-Through Costs during the Term that are needed or used by Lessee. Lessor shall permit Lessee to arrange for and install separate metering service on the Leased Property to record and account for Lessee's utility use. Lessor shall make available, at Lessor's cost, potable water and any other utilities as agreed to under the WTA to Lessee in sufficient quantities for the construction and operation of the System. 5.4 Ownership of S sv tem. (a) Lessor acknowledges and agrees that, at all times during the Term, the System, including all constituent elements or components thereof, (i) is exclusively owned by Lessee or Lessee's Affiliate, (ii) is and shall continue to be the personal property of Lessee and not Lessor, and is not and shall not become or be deemed part of or fixtures to the Leased Property or the Lessor Property, and(iii) shall be installed, operated, and maintained exclusively by Lessee or its Representatives in Lessee's sole discretion and not Lessor unless otherwise agreed by the Parties in writing. Unless otherwise agreed in writing, Lessor shall not engage in any System Activities. (b) Lessor consents to Lessee, in Lessee's sole discretion, filing, on behalf of Lessor, a disclaimer of the System as a fixture of the Lessor Property or the Leased Property in the office where real estate records are customarily filed in the jurisdiction of the Lessor Property. (c) Lessor acknowledges that Lessee is the owner of all Environmental and Tax Attributes attributable to the System, along with any other products or services of any kind produced by the System. (d) At the end of the Term or in the case of Lessor exercising its buyout right under Section 5.5 of the WTA, unless as specified elsewhere in this Agreement, Lessor has the option to purchase for fair market value,using the procedures in Section 5.5 of the WTA, all right, title, and interest in and to the System, on an "AS-IS" "WHERE IS"basis, without any warranty or further liability to Lessee. Each Party further agrees to cooperate with the other Party to take the necessary actions and execute the necessary documents to effectuate such purchase and sale. Following such transfer, unless specified elsewhere in this Agreement including, but not limited to, in this Section 5.4(d), neither Party shall owe any further liability or obligation to the other Party. The provisions of this Section 5.4(d) shall survive the expiration or earlier termination of this Agreement. 506528698.4 ARTICLE 6 : Representations and Warranties 6.1 Mutual Representations and Warranties. Each Party represents and warrants to the other Party: (a) Existence. Such Party is duly and validly formed, existing and in good standing under the laws of the state of its formation or organization and has all requisite power and authority to enter into and perform its obligations under this Agreement. Such Party is duly qualified or licensed to do business in each jurisdiction where the failure to duly qualify or become licensed would adversely affect such Party's ability to perform its obligations under this Agreement. (b) Authorization. The execution, delivery and performance by such Party of this Agreement, and the consummation of the transactions contemplated by this Agreement, have been duly and validly authorized by all necessary action on the part of such Party. (c) Enforceabilitv. This Agreement constitutes the legal, valid and binding obligations of such Party enforceable against such Party in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, arrangement, moratorium or other similar laws, now or hereafter in effect,relating to creditors'rights generally. (d) Consents and A�provals. No consent or approval by, filing with or notice to any Person(including third parties or Governmental Authorities) is required on the part of such Party or any of its Affiliates for the valid execution and delivery of this Agreement and the performance of its obligations hereunder and thereunder, other than those that have been obtained and are in full force and effect. (e) No Violation. Such Party's execution and delivery of this Agreement and performance of its obligations hereunder and thereunder do not and will not (i) violate or conflict with the organizational documents of such Party; (ii) violate or conflict with any law or any order of any court or other Governmental Authority which is binding on (A) such Party or any Affiliate of such Party or (B) assets of such Party or any Affiliate of such Party; or(iii) violate, result in a default under or result in the termination, acceleration or mandatory prepayment of (with or without the giving of notice, the passage of time or both) any obligation under any contract or indebtedness to which such Party or any Affiliate of such Party is party or by which any such Party or any such Party's assets are bound. 6.2 Lessor represents and warrants to Lessee: (a) Lessor is the fee simple owner of, and has good and marketable title to, the Lessor Property (including the Leased Property). Lessor's ownership of the Lessor Property (including the Leased Property) is subject to no Liens or exceptions to title other than Liens, if any, expressly disclosed in writing by Lessor to Lessee prior to the Agreement Date. Lessor is the sole owner of the Lessor Property (including the Leased Property) and has the unrestricted right and authority to execute this Agreement and to grant to Lessee the rights granted hereunder. (b} To the best of Lessor's knowledge, (i) no underground tanks are now located or at any time have been located within the Leased Property or any portion thereof, and 506528698.4 (ii) there is no and has never been any violation or alleged violation with respect to the Leased Property, or the presence, generation, storage, disposal or release of Hazardous Substances in, on or under the Leased Property or within two hundred (200) feet of the Leased Property, of any Environmental Law, including laws,rules or regulations relating to Hazardous Substances. (c) Lessor is not a party to any,and to Lessor's knowledge,there are no pending or threatened, legal, administrative, arbitral or other proceedings, claims, actions or governmental or regulatory investigations of any kind or nature whatsoever against Lessar (i) challenging the validity or propriety of this Agreement, andlor transactions contemplated in this Agreement or(ii) which could reasonably be expected to have a material adverse effect on the ownership or operation of the Lessor Property or any part thereof or interest therein. (d) To the best of Lessor's knowledge, there are no currently existing options, rights of refusal, sales contracts, mineral rights requiring substantial use of the surface or other rights in favor of any third parties relating to the Lessor Property or any interest therein, which could interfere with the development, construction, installation, maintenance or operation by Lessee of the System or that allow any party other than Lessee to develop a renewable energy project or that could adversely affect Lessee's use of the Lessor Property or obtaining the benefits intended under this Agreement. (e) The Parties acknowledge that a Record of Survey has been filed to cause the Leased Property to be a separate and independent legal lot of record. Lessor agrees to indemnify, defend, and hold harmless Lessee and all Lessee Parties from any costs or claims that may arise by reason of any non-compliance with respect to zoning laws applicable to the Leased Property (including, without limitation, (i) legal fees and court costs, and (ii) consequential or punitive damages). ARTICLE 7 : Insurance 7.1 Insurance to be Maintained; Obligations with Respect Thereto (a) Lessee shall maintain comprehensive general liability insurance with respect to the Leased Property and the Lessor Property of which the Leased Property is a part, in the amount of $1,000,000 per occurrence and $2,000,000 in the aggregate per annum with responsible companies qualified to do business in the state in which the Lessor Property is located and in good standing therein insuring both Lessee and Lessor as additional insured against injury to persons or damage to property as provided. (b) Lessor shall maintain insurance coverage of such types and amounts as may be customary, prudent, and reasonable in light of Lessor's ownership of and activities conducted on the Lessor Property, naming Lessee as additional insured. (c) The Parties shall provide each other with certificates for such insurance at or prior to the commencement of the Term, and thereafter within 30 (thirty) days prior to the expiration of any such policies.All such insurance certificates shall provide that such policies shall not be cancelled without at least 30 (thirty) days prior notice to each insured named therein. 506528698.4 7.2 Lessor and Lessee shall each maintain on their respective personal property on or about the Lessor Property a policy of"all risk"property insurance, with vandalism and malicious mischief endarsements, to the extent of at least 100 percent (100%) of full replacement value of its personal property. Lessor and Lessee shall each maintain worker's compensation insurance to the extent required by Applicable Law. 7.3 Lessee shall maintain workers' compensation insurance as required by law. ARTICLE 8 : Covenants 8.1 Lessee Covenants. Lessee shall not directly or indirectly cause, create, incur, assume or allow to exist any Lien on or against the Lessor Property; the foregoing does not preclude the imposition of a Lien on the System by Lessee's Lender or as permitted under Article 14,provided that such Lien shall not create any Lien on the real property of Lessor. 8.2 Lessor Covenants. (a) Lessor shall not directly or indirectly cause, create, incur, or assume any Lien on, affecting or with respect to the System (including any constituent element or component thereo fl or any interest therein.Lessor shall immediately notify Lessee of the existence of any such Lien,shall promptly cause the same to be discharged and released of record without cost to Lessee, and shall indemnify Lessee against all costs and expenses (including reasonable attorneys' fees) incurred in discharging and releasing any such Lien or that otherwise arose as a result of such Lien. (b) Lessor and its authorized representatives and invitees shall not conduct activities on, in or about the Leased Property or the Lessor Property in a manner that has any likelihood of causing damage to, impairment of, or otherwise adversely affecting the System, or that are not in accordance with the WTA or Lessee's safety protocols with respect to the System, and Lessor shall not permit any other lessee at the Lessor Property or any other person to do so. Lessor's activities and any grant of rights Lessor makes to any Person, whether located on the Lessor Property or elsewhere, shall not,currently or prospectively,interfere with:the construction, installation, maintenance or operation of the System, whether located on the Lessor Property or elsewhere; access over the Lessor Property to the Leased Property or the System; any System Activities; or the undertaking of any other activities permitted under this Agreement. (c) Lessor acknowledges that certain aspects inherent to the operation of the System may result in some nuisance, such as visual impacts, possible increased noise levels, possible odor, and other possible effects of renewable natural gas production and transportation. Without limiting the grant of easements made in Article 2 of this Agreement, Lessor understands and has been informed by Lessee that the System may result in some nuisance, and hereby accepts such nuisance, waives its right to object to such nuisance, and agrees to indemnify and defend Lessee from any third party claims concerning such nuisance, in each case provided that Lessee complies with its obligations in this Agreement. (d) Lessar shall not violate any Environmental Law in connection with or related to Lessor's ownership or use of the Lessor Property, including without limitation any such violation which may have occurred by Lessor, or Lessor's employees, members, managers, affiliates, invitees, or agents (collectively, "Lessor Parties") or any other person prior to the 506528698.4 Agreement Date. In conformance with the requirements of Applicable Law, Lessor shall clean up, remove, remedy and repair any soil or ground water contamination and damage caused by the release or disposal of any Hazardous Substances by Lessor or any Lessor Party in, on, under, or about the Leased Property or within two hundred (200) feet of the Leased Property. (e) Lessor covenants that Lessee shall have quiet and peaceful possession of the Leased Property and the rights granted by this Agreement for the entire Term without hindrance, interruption, suit, trouble or interference of any kind by Lessor or any other Person claiming (whether at law or in equity) by, through or under Lessor. Lessor covenants and agrees to and with Lessee: (i) not to allow any Liens against the Leased Property during the Term other than Liens expressly consented to by Lessee in writing or a Lessor Mortgage with respect to which a nondisturbance agreement in a form approved by Lessee has been executed pursuant to Section 15.1 (collectively, "Permitted Liens"), (ii) to promptly pay when due any and all obligations secured by Liens against the Leased Property(including Permitted Liens), (iii) not to allow any default to occur under oblig�tions secured by Liens againsY the Leased Property (including Permitted Liens), and (iv) in accordance with Section 15.1, to obtain a nondisturbance agreement from the holders of all Lessor Mortgages. In lieu of paying amounts secured by Liens that are not Permitted Liens, Lessor may provide a bond or other adequate security in accordance with Applicable Law and the reasonable requirements of Lessee. (� Lessor,in its ministerial role as a governmental agency, shall not enforce or promulgate any law or other governmental regulation in a manner that unduly prejudices, preferences,or burdens Lessee relative to other third parties subject to Lessor's jurisdiction. Lessor shall not take any action as a governmental agency that would cause Lessee to be in breach of this Agreement. For avoidance of doubt, Lessor shall not change zoning laws or permit requirements in a manner that discriminates against Lessee's rights under this Agreement or the WTA. ARTICLE 9 : Indemnification 9.1 Each Party (the "Indemnifying Party") shall defend, indemnify and hold harmless the other Party and the directors, officers, shareholders, partners,members, agents and employees of such other Party, and the respective Affiliates of each thereof(each, an "Indemnified Party" and, collectively, the"Indemnified Parties"), from and against all Claims resulting from(a) 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), (b) violation of Applicable Law (including any Environmental Law) by the Indemnifying Party (or its contractors, agents or employees), (c) a breach or default in the performance of any obligation to be performed by the Indemnifying Party under the terms of this Agreement, (d) any other matter identified as requiring indemnification, or(e) with respect to Lessee as the Indemnifying Party, the release or threatened release of any Hazardous Substance at,on,above or below the Leased Property that has been caused by Lessee or Lessee's contractors, 506528698.4 agents or employees following the Agreement Date,and with respect to Lessor as the Indemnifying Party,the release,threatened release,removal,treatment, storage,disposal,disposition,mitigation, or cleanup of any Hazardous Substance at, on, above or below the Leased Property prior to the Agreement Date or, following the Agreement Date, the release or threatened release of any Hazardous Substance at, on, above or below the Leased Property that has not been caused by Lessee or Lessee's contractors, agents or employees. Without limiting the foregoing, the indemnification obligations set forth herein include Claims brought against any Indemnified Party by any third party. Nothing in the foregoing shall require the Indemnifying Party to indemnify the Indemnified Party for any Claims to the extent caused by or arising out of the Indemnified Party's Event of Default, the negligent acts or omissions of, or the willful misconduct of,the Indemnified Party, any Force Majeure event, any act or omission of any Indemnified Party responsible for ar contributing to the Claim, or any matter for which the risk has been specifically allocated to a particular Party hereunder or under the WTA. 9.2 Indemnification Procedures. A Lessee Indemnified Party shall promptly notify Lessor of the assertion of any claim against it for which it is entitled to be indemnified hereunder, shall give the Lessor the opportunity to defend such claim, and shall not settle the claim without the approval of the Lessor which approval shall be in the Lessor's sole discretion. These indemnification provisions are for the protection of the Lessee Indemnified Parties only and shall not establish, of themselves, any liability to third parties. 9.3 Limitation of Liabilit . IN NO EVENT SHALL EITHER PARTY HAVE ANY LIABILITY UNDER THIS AGREEMENT OR ANY INDEMNITY OFFERED THEREUNDER FOR ANY SPECIAL,PUNITIVE,EXEMPLARY, SPECULATIVE,INDIRECT,REMOTE, OR CONSEQUENTIAL DAMAGES, DAMAGES FOR LOST PROFITS OR DAMAGES BASED ON A MULTIPLE OF EARNINGS OR DIMINUTION IN VALUE, OR ANY SIMILAR DAMAGES. FOR THE AVOIDANCE OF DOUBT, THE INDEMNIFICATION OBLIGATIONS OF THE PARTIES SHALL INCLUDE THOSE ARISING UNDER STRICT LIABILITY. 9.4 Survival. The provisions of this Article 9 shall survive termination of this Agreement. ARTICLE 1Q : Condemnation 10.1 Contests. If, during the Term, any competent authority or entity for any public or quasi-public purpose ("Condemnor") seeks to take or condemn all or any portion of the Leased Property, Lessor and Lessee shall use all reasonable and diligent efforts, each at its own expense, to contest such taking. 10.2 Termination Due To Condemnation. Except as otherwise set forth in the WTA, if at any time during the Term, any Condemnor shall condemn all or any portion of the Leased Property, or the System, so that the purposes of this Agreement are frustrated, then, at Lessee's option, (a) this Agreement shall be modified to revise the definition of Leased Premises to reflect such portion not condemned or(b) this Agreement shall cease and terminate, in either event,upon the earlier of(i) the date that the Condemnor takes physical possession of the Leased Property or the System, (ii) the date that Lessee is, in its sole judgment,no longer able or permitted to operate 506528698.4 the System on the Leased Property in a commercially viable manner, or(iii) the date title vests in the Condemnor. In the event Lessee elects to terminate this Agreement, as provided in the foregoing sentence, Lessee shall continue to pay all amounts payable hereunder to Lessor until the earlier of such dates, at which time Lessor and Lessee shall be relieved of any and all further obligations and conditions to each other under this Agreement, except (A) Lessor shall pay to Lessee a sum representing the total value of the Outstanding Debt, minus the value of any insurance proceeds received or owed to Lessee or Lender arising from a System casualty preceding the effective date of termination (and Lessor shall make such payment to Lessee on the effective date of termination), and(B)the Parties shall be responsible for any indemnity obligations or other obligations which by their terms survive the expiration or termination of the Agreement. 10.3 Distribution of Award. For any taking covered by this Article 10, all sums, including damages and interest, awarded shall be paid and distributed to Lessee and Lessor in accordance with their respective interests under this Agreement. 10.4 Notwithstanding the provision in Section 17.6 of this Agreement, unless Lessor is the Condemnor, this Article 10 shall control in the event of a conflict between the terms in this Agreement and the WTA. This Article 10 shall survive the expiration or earlier termination of this Agreement. ARTICLE 11 : Events of Default, Remedies and Damages 11.1 Events of Default. Each of the following shall constitute an `Bvent of Default"by a Party(the"Defaulting Party"): (a) such Party's material misrepresentation in connection with this Agreement, fraud, or intentional misconduct; (b) failure of such Party to pay any amount due and payable under this Agreement; (c) failure of such Party to perform any material obligation (other than a payment obligation)under this Agreement; (d) an Insolvency Event occurs with respect to such Party; (e) the occurrence of{i) a Material Breach of the WTA by a Defaulting Party, or(ii) the WTA is terminated by reason of a breach by the Defaulting Party thereunder. 11.2 Remedies. (a) Event of Default bv Lessee. (i) If Lessee is the Defaulting Party, Lessor may,but is not required to, terminate this Agreement by providing Lessee sixty(60)days advance written notice of the Event of Default,during which sixty(60)day period Lessee shall have the opportunity to cure such Event of Default. 506528698.4 (ii) If Lessee fails to cure and Lessor exercises its termination right, such termination shall be effective upon the date that Lessor and Lessee fully and finally execute any agreements or documents necessary to effectuate the Lessor's remedy under Section 7.4(a) of the WTA. (iii) Subject to Section 11.5 of this Agreement, if Lessee is the Defaulting Party,beyond any applicable notice and cure periods set forth in this Agreement,Lessor may seek any and all additional available remedies at law or in equity;provided, however, that the remedies provided under the WTA and this Agreement are not meant to provide Lessor with double recovery. (iv) Notwithstanding anything to the contrary set forth herein, Lessor may not terminate this Agreement by reason of any Lessee default so long as the WTA is in effect. (b) Event of Default by Lessor. (i) If Lessor is the Defaulting Party for a non-monetary default, Lessee may,but is not required to,terminate this Agreement by providing Lessee sixty(60)days advance written notice of the Event of Default, during which sixty (60) day period Lessor shall have the opportunity to cure the Event of Default (except for breaches predicated upon Lessor's nonpayment, in which case a 30-day cure notice and cure period shall apply). If Lessor fails to cure and Lessee exercises its termination right, Lessor shall owe to Lessee as direct damages, and not as a penalty, the amounts identified in Section 7.4(b) of the WTA. (ii) Subject to Section 11.5 of this Agreement, if Lessor is the Defaulting Party, beyond any applicable notice and cure periods set forth in this Agreement, Lessee may seek any and all additional remedies at law or in equity;provided, however, that the remedies provided under the WTA and this Agreement are not meant to provide Lessee with double recovery. (c) Events under the WTA. Notwithstanding anything to the contrary in this Article 11, if either Party is in default per Section 11.1(e), then the Defaulting Party shall get the benefit of any notice and cure period under the WTA or this Agreement, whichever is longer, but shall not get the benefit of both cure periods. 11.3 Event of Default or Anticipated Breach. In the case of any Event of Default under or anticipated breach of this Agreement, each Party agrees to use good faith efforts to take such commercially reasonable actions as necessary to expeditiously resolve the underlying circumstance;provided, however, that in all circumstances neither Party shall be required or be deemed to have waived any defenses it may have under Applicable Law or contract. 11.4 Lender Ri�ht to Cure. If Lessor is the Defaulting Party under this Agreement, Lessor agrees and acknowledges that Lender(s) may, but do(es) not have the obligation to, (i} acquire title to the System,(ii)cure all defaults and breaches that are capable of cure,or(iii)assume any Lessee obligation under this Agreement, in which case Lessor shall recognize such Lender(s) as if such Lender had been the original party to this Agreement. 506528698.4 11.5 Dispute Procedures. Provided the WTA is in full force and effect, the Parties agree that all disputes under this Agreement shall be governed by Section 6 and Section 7 of the WTA as if such sections had been set forth herein. ARTICLE 12 : Force Ma,jeure Except as otherwise set forth herein,in the event either Party is rendered unable,wholly or in part, to carry out its respective obligations under this Agreement, except for any obligation to make payment, due to circumstances beyond its reasonable control,including,without limitation, strike, riot, lockouts or other disturbances, flood, natural disaster, acts of God, war or civil insurrection, an epidemic,pandemic or viral or communicable disease outbreak,quarantine,national emergency or other unforeseeable circumstances beyond its reasonable control (a "Force Majeure"), then written notice setting out the reason for non-performance shall be given to the other Party by the Party claiming Force Majeure promptly following discovery thereof. Upon receipt of such notice, the obligations of the affected Party shall be suspended during the period of the Force Majeure and any deadline or date certain for performance shall be extended by a period equal to the period of the Force Majeure. Every reasonable effort shall be made by the Parties to avoid delay and limit any period during which performance under this Agreement might be suspended. ARTICLE 13 : Dispute Resolution 13.1 This Agreement shall be interpreted in accordance with the laws of the State of Washington without giving effect to its choice of law principles. 13.2 Any disagreement between Lessor and Lessee which cannot be resolved in accordance with this Agreement shall be referred to the senior management of each Party who shall attempt to resolve the dispute in good faith. To aid resolution by the Parties' senior management, Lessor's and Lessee's representatives shall promptly prepare and exchange memoranda stating the issues in dispute and their positions, summarizing the negotiations which have taken place and attaching relevant documents. If the Parties' senior management resolves the dispute, such resolution shall be reported in writing to and shall be binding upon the Parties. 133 If, despite the good faith efforts described in Section 13.2,the Parties are unable to resolve a dispute or claim arising out of or relating to this Agreement or its breach, termination, enforcement, interpretation or validity, the Parties may seek to agree on a forum for mediation to be held at a mutually agreeable site. 13.4 If, despite good faith efforts described in Section 13.2 and 13.3, the Parties are unable to resolve a dispute or claim arising out of or relating to this Agreement or its breach, termination, enforcement, interpretation or validity, (including the determination of the scope or applicability of this Agreement to arbitrate), shall be determined by arbitration in Seattle, Washington before a single arbitrator who is an experienced attorney in the discipline that is the subject of the dispute and whom shall be jointly selected by Lessor and Lessee. The arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures. The arbitrator shall issue a reasoned, written decision which will be binding on the Parties. Judgment may be entered upon the arbitrator's decision in any court of competent jurisdiction,and 506528698.4 each Party agrees to submit to the personal jurisdiction of any such court for the purposes of any such actions or proceedings to enter or enforce such judgment. 13.5 Should either Party employ an attorney to enforce any of the provisions of this Agreement, the non-prevailing Party in any final judgment agrees to pay the other Party's reasonable expenses, including reasonable attorneys' fees and expenses in or out of litigation and, if in litigation, trial, appellate, bankruptcy or other proceedings, expended or incurred in connection therewith, as determined by a court of competent jurisdiction. 13.6 The venue for any judicial proceedings relating to this Agreement shall be the Superior Court for the State of Washington in Franklin County. ARTICLE 14 : Financing 14.1 Lender. Notwithstanding any other provision, Lessee shall have the right to encumber its interest in this Agreement, the System and any of Lessee's other improvements located on the Leased Property by mortgage, lease, deed of trust or similar instrument or instruments and by security agreement, fixture filing and financing statements or similar instrument or instruments in favor of Lender. Lessar represents and warrants as follows: (i) such encumbrance by Lessee will not violate any term or condition of any covenant or restriction affecting the Lessor Property or the Leased Property; (ii)there is no existing Lien upon the Lessor Property or the Leased Property that could attach to the System an interest adverse to or senior to Lessee's Lenders' security interest therein; and (iii) there exists no event or condition which constitutes a default, or would,with the giving of notice or lapse of time, constitute a default under the Agreement. 14.2 Rights of Lender. (a) In the event of a foreclosure or seizure of Lessee's rights or property or the exercise of any other right under any security agreement granted by Lessee to a Lender, Lessor agrees to permit such Lender to exercise any and all rights of Lessee hereunder. (b} Lessor agrees to execute any consent to assignment reasonably requested by any Lender to evidence and give effect to the provisions of this Article 14. Lessor shall be timely provided with current addresses for all Lenders and their assignees. At Lessee's request, Lessor shall amend this Agreement to include any provision that may reasonably be requested by an existing or proposed Lender, and shall execute such additional documents as may reasonably be required to evidence such Lender's rights hereunder. (c) Further, Lessor shall, within thirty(30) days after receipt of written request from Lessee or any existing or proposed Lender, execute and deliver thereto a certificate to the effect that Lessor (i} recognizes a particular entity as a Lender under this Agreement and (ii) will accord to such entity all the rights and privileges of a Lender hereunder,in addition to any estoppel or certificate required under Section 17.4. (d) All Lenders shall be deemed third party beneficiaries of the rights granted to Lessee under this Agreement. 506528698.4 ARTICLE 15 : Subordination; Non-Disturbance At Lessee's request, Lessor shall obtain from holders of any mortgage(s) now or subsequently granted by Lessor and recorded against the Leased Property and to any renewals, modifications, refinancings and extensions thereof("Lessor Mortgages"), execution and delivery to Lessee of a nondisturbance agreement, in recordable form with terms and conditions acceptable to Lessee, in its sole discretion, under the terms of which the holder of the Lessor Mortgage covenants and agrees to and with Lessee (i) not to disturb Lessee in its possession of the Leased Property or in the enjoyment of its rights hereunder, and (ii) to notify Lessee of any defaults by Lessor in the performance of its obligations secured by the Lessor Mortgage, and (iii) to provide Lessee a reasonable period of time after Lessee's receipt of notice of Lessor's default to cure said default (which period shall be not less than forty-five (45) days in the event of payment defaults and ninety (90) days in the event of non-payment defaults, and which period shall be extended if default cannot reasonably be cured within such period,provided Lessee has promptly commenced and is diligently performing actions to cure the default), before exercising any rights to foreclose upon or otherwise take ownership of the Leased Property. ARTICLE 16 : Recordation; Confidentiality 16.1 Memorandum of Lease and Easement. The Parties agree that this Agreement shall not be recorded, but the Parties shall execute and record a memorandum of lease and easement agreement ("Memorandum of Lease") in recordable form substantially in the form of Exhibit D with the applicable registry of deeds in the jurisdiction in which tfie Lessor Property is located, which Memorandum of Lease shall contain a reference to the easements and covenants granted by Lessor to Lessee hereunder and shall otherwise be in form and content reasonably acceptable to Lessee. Recordation of the Memorandum of Lease shall be at Lessee's expense. 16.2 Confidentialitv. (a) Except as set forth herein, (i) neither Party will disclose Confidential Information of the other Party to any third party, and (ii) each Party will use the other Party's Confidential Information only for purposes of the transactions contemplated by this Agreement; provided, however, that a Party in possession of the other Party's Confidential Information may disclose Confidential Information as required to comply with orders of governmental entities that have jurisdiction over it or as otherwise required by law. (b) Each Party agrees to (i) take reasonable steps to protect the other Party's Confidential Information (which steps will be required to be at least as protective as those that the receiving Party takes to protect its own Confidential Information), (ii) notify the other Party promptly upon discovery of any unauthorized use or disclosure of Confidential Information; and (iii) cooperate with the other Party to help regain control of any Confidential Information that is the subject of any such unauthorized use or disclosure and prevent further unauthorized use or disclosure of such Confidential Information. (c) Each Party may disclose the other Party's Confidential Information to its subcontractors, agents, legal counsel, accountants, consultants, financing parties, or representatives to the extent necessary in furtherance of this Agreement, and then only on a"need 506528698.4 to know" basis in connection with the transactions contemplated hereby and on a confidential basis. Without negating the foregoing, Lessor agrees and acknowledges that Lessee may disclose this Agreement and all matters relevant to Lessee's rights and obligations hereunder (including, without limitation, correspondence with Lessor) to Lessee's Lender(s) for any financing related purpose, and that such disclosure shall not be in violation of this Agreement. (d) This Agreement shall be considered a public document and will be available for inspection and copying in accordance with the Public Records Act, chapter 42.56 of the Revised Code of Washington (the "Act"). If Lessee considers any record, in whole or in part, provided to Lessor under this Agreement,whether in electronic or hard copy form, to be protected from disclosure under the Act, Lessee shall make reasonable efforts to clearly identify each such record with words such as"CONFIDENTIAL,""PROPRIETARY"or"BUSINESS SECRET."If a request is made for disclosure of any Lessee Confidential Information, Lessor shall promptly notify and provide Lessee with a copy of such request. In all cases, Lessor will ultimately determine whether the requested material should be made available under the Act. If Lessor determines that the material is subject to disclosure, Lessor will notify Lessee of its decision and allow Lessee ten (10) business days to take whatever action it deems necessary to protect its interests. If Lessee fails or neglects to take such action within said period, Lessor will release the record(s)or portions thereof reasonably deemed by Lessor to be subject to disclosure. Lessor shall not be liable to Lessee for inadvertently releasing records pursuant to a disclosure request not clearly identified by Lessee as "CONFIDENTIAL," "PROPRIETARY" or `BUSINESS SECRET." ARTICLE 17 : Miscellaneous 17.1 Definitions. Capitalized terms used in this Agreement shall have the meaning set forth in Exhibit A hereto or as otherwise defined herein. 17.2 Inte retation. Except where otherwise expressly provided or unless the context otherwise necessarily requires, in this Agreement the following shall apply. Reference to a given section, exhibit, annex or schedule is a reference to a section, exhibit, annex or schedule of this Agreement, unless otherwise specified, and all schedules, exhibits and annexes hereto are hereby made a part hereof and incorporated herein by such reference.The headings used in this Agreement have been inserted for convenience of reference only and do not define or limit the provisions hereof. The terms "this AgreemenY', "hereof', "herein", "hereto", "hereunder" and "herewith" refer to this Agreement as a whole. If the time for performing an obligation under this Agreement expires on a day that is not a business day, the time shall be extended until that time on the next business day. With respect to the determination of any period of time, the word "from" means "from and including" and the words "to" and "until" each means "to but excluding". The words "shall" and "will" have the same meaning. The words "include," "includes" or "including" and words of similar import shall be deemed to be followed by the phrase "without limitation" and shall not be limited by any enumeration or otherwise; any pronoun or pronouns used herein shall be deemed to include both the singular and the plural and to cover all genders; the use of the words "or," "either" and "any" shall not be exclusive. The provisions of this Section 17.2 shall survive any expiration or termination of this Agreement. 506528698.4 17.3 Governin Law• Remedies. This Agreement shall be governed by the laws of the State of Washington, without regard to the conflicts of law rules of any jurisdiction. 17.4 Assi�runent. (a) The burdens of the lease, easements and other covenants, rights and obligations contained in this Agreement shall run with and against the Lessor Property and shall be a charge and burden thereon for the duration of this Agreement. Lessor shall provide at least 30 days' prior written notice to Lessee of any sale, assignment or transfer ("Transfer") of any of Lessor's interest in the Lessor Property(or any part thereo� or in this Agreement. In addition, any such Transfer shall be expressly subject to this Agreement. Lessor shall notify Lessee of the closing of such Transfer, and if applicable, the name and contact information of the successor to Lessor's interest and payment instructions for Rent and other amounts due under this Agreement;provided, that Lessor shall indemnify Lessee for losses arising from Lessee's payment of Rent or other amounts as so directed. Until such notice of closing is received, Lessee shall have no duty to any successor to Lessor's interest, and Lessee shall not be in default under this Agreement if it continues to make all payments to the original Lessor before such notice is received. Under no circumstances shall a Transfer by Lessor include the System. (b) This Agreement shall be binding on and inure to the benefit of the Parties' successors and permitted assignees. (c) Lessee may assign,pledge as collateral (in accordance with Article 14,with respect to a Lender), sell or transfer this Agreement or the System or any of Lessee's rights or obligations under this Agreement or rights in and to the System (a) to any Affiliate of Lessee or (b) to any Lender or as part of any transaction Lessee or any Affiliate of Lessee may enter into with any Lender; Lessor hereby consents to any such assignment, pledge, sale or transfer. Lessor acknowledges that Lessee or an Affiliate of Lessee may obtain financing (including, without limitation, any form of debt, equity or lease financing) or credit support from one or more Lenders in relation to the development, construction, ownership, transfer, operation or maintenance of the System. Any Lender (or its wholly owned assignee or designee), or any person acquiring the Lessee's leasehold estate pursuant to foreclosure of a mortgage or a deed or assignment in lieu of such foreclosure,may,upon acquiring the leasehold estate,upon prior written approval of Lessor, which shall not be unreasonably withheld, conditioned or delayed, sell and assign the leasehold estate on such terms and conditions as it may determine and thereafter be relieved of all obligations under this Lease accruing from and after the date of such sale and assignment. (d) Both Parties agree in good faith to consider and to negotiate changes or additions to this Agreement that may be requested by the Lenders. Lessor agrees to execute any consent, estoppel or acknowledgement in form and substance requested by such Lenders (including those consents and other documents pursuant to Article 14, in the case of a collateral pledge to a Lender); any such Lender shall be deemed to be an intended third-party beneficiary of the provisions of this Agreement. (e) Either Party, without charge, at any time and from time to time, within five (5) business days after receipt of a written request by the other Party, shall deliver a written instrument, duly executed, certifying to such requesting Party, ar any other Person specified by 506528698.4 such requesting Party (including any Lender): (i) that this Agreement is unmodified and in full force and effect, or if there has been any modification, that the same is in full force and effect as so modified, and identifying any such modification; (ii) whether or not to the knowledge of any such Party there are then existing any offsets or defenses in favor of such Party against enforcement of any of the terms, covenants and conditions of this Ageement and, if so, specifying the same and also whether or not to the knowledge of such party the other party has observed and performed all of the terms, covenants and conditions on its part to be observed and performed, and if not, specifying the same; and (iii) such other information as may be reasonably requested by the requesting Party. Any written instrument given hereunder may be relied upon by the recipient of such instrument, except to the extent the recipient has actual knowledge of facts contained in the certificate. 17.5 Material Chan�e in Law. In the event of a Material Change in Law,the Parties shall, to the extent necessary and possible, reform this Agreement to ensure compliance and conformity with such Material Change in Law and to restore or retain the Parties' original benefits and burdens under this Agreement. For purposes of this Agreement, a"Material Change in Law" shall mean: (a) the adoption, promulgation, change, repeal or modification after the Agreement Date of any laws, codes, regulations, statutes or orders, (b) an interpretation or application by a Governmental Authority of a law which had not been made, or which if made, was different than a prior interpretation of or application by such Governmental Authority or another Governmental Authority,or(c)the imposition of any material condition in connection with the issuance,renewal, extension,replacement or modification of any permits after the Agreement Date that in the case of (a), (b) or(c): (i) establishes requirements for the construction, financing, ownership, operation or maintenance of the System that are materially more restrictive than the most restrictive requirements in effect as of the Agreement Date, and (ii) has a material and adverse effect on the Lessee's quiet enjoyment of and/or value obtained from the Leased Property. 17.6 Entire A�,reement.This Agreement and the WTA,including any exhibits,schedules or annexes attached hereto and thereto, constitute the entire agreement and understanding between the Parties with respect to Lessee's leasehold interests and supersedes all prior written and oral agreements, discussions, or representations between the Parties, including any non-disclosure agreements;provided that in the case of any conflict or inconsistency between or among the terms of this Agreement and the WTA, the terms of the WTA will govern provided that the WTA is in full force and effect. 17.7 Severabilitv. If a court or other body of competent jurisdiction finds, or the Parties mutually believe, any provision of this Agreement, or portion thereof, to be invalid or unenforceable, such provision will be enforced to the maximum extent permissible so as to effect the intent of the Parties, and the remainder of this Agreement will continue in full force and effect. 17.8 Modification, Waiver. No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in a writing signed by the Parties. Waiver by a Party of a breach of any provision of this Agreement will not operate as a waiver of any other or subsequent breach. 17.9 Notices. Unless otherwise expressly provided in this Agreement, any notice, request, demand, waiver, consent, approval or other communication that is required or permitted 506528698.4 under this Agreement shall be in writing and shall be sent by personal delivery, facsimile transmission, electronic mail, overnight courier, or regular, certified, or registered mail, return receipt requested, to the Lessee or the Lessor, as applicable, at the address below, or to such other addresses as the Parties may specify from time to time in writing. Notices and other communications shall be effective upon personal delivery, receipt of electronic transmission, the promised delivery date after deposit with overnight courier, or five (5) days after deposit in the mail.The Parties deem documents faxed, emailed or sent electronically as PDF files or comparable electronic medium to the specified addresses to be original documents. If to Lessee: Burnham SEV Pasco LLC 1201 Wilson Blvd—27th Floor Arlington, VA 22209 With a copy to: legal@burnahmdev.com If to Lessor: City of Pasco Adam Lincoln City Manager 525 N 3rd Avenue Pasco, WA 99301 With a copy to: Eric Ferguson eferguson@kerrlawgroup.net Third Partv Beneficiary. Except as otherwise provided in this Agreement, this Agreement does not create or imply any rights of or obligations to Persons other than the Parties. Survival. The provisions of this Agreement that should reasonably be considered to survive termination of this Agreement shall survive any termination of this Ageement. For the avoidance of doubt, surviving provisions shall include Article 1 (Term); Article 5 (System transfer) Article 9 (Indemnification); Article 11 (Events of Default, Remedies and Damages); Article 13 (Dispute Resolution); Article 17 (Miscellaneous); and Exhibit A(Definitions). Si�natures. This Agreement may be signed in one or more counterparts, including by PDF or comparable electronic medium, each of which shall be deemed an original, with the same force and effectiveness as though executed in a single document. [SIGNATURE PAGES FOLLOW] 506528698.4 The Parties, through their duly authorized representatives below, have executed this Agreement as of the Agreement Date. LESSEE BURNHAM SEV PASCO LLC, a Washington limited liability company By: Name: Chris Tynan Title: CEO Date STATE OF COUNTY OF This record was acknowledged before me on by as of BURNHAM SEV PASCO LLC. (Signature of notary public) (Title of o�ce) My Commission Expires: (Date) (Stamp) 506528698.4 LESSOR CITY OF PASCO, a Washington municipal corporation By: Name: Title: Date STATE OF WASHINGTON COUNTY FRANKLIN OF This record was acknowledged before me on _, 20_ by as of the CITY OF PASCO. (Signature of notary public) (Title of o�ce) My Commission Expires: (Date) (Stamp) 506528698.4 EXHIBIT A DEFINITIONS Capitalized terms not defined herein are as defined in the WTA. The following words and phrases shall have the meanings set forth herein: "Affiliate" means, with respect to a Person, any Person that directly or indirectly controls, is controlled by, or is under common control with such Person; "Applicable Law" means any applicable law, statute, code, rule, regulation, ordinance, decree, judgment, directive, permit, license, registration, guideline, approval, ruling, injunction, decision or other requirement of a Governmental Authority; "Initial Term"is defined in Section 1.3; "Initial Term Payment"is defined in Section 3.2; "Condemnor"is defined in Section 10.1; "Confidential Information"means any non-public information, know-how or trade secrets in any form that is designated"confidential"or that a reasonable person should understand is confidential. The following information does not constitute Confidential Information: (a) information that is or becomes generally available to the public other than as a result of a disclosure by either Party in violation of this Agreement, (b) information that was already known by either Party on a non- confidential basis prior to this Agreement, (c) information that becomes available to either Party on a non-confidential basis from a source other than the other Party if such source was not subject to any prohibition against disclosing the information to such Party, and (d) information that is independently developed by a Party without violating its obligations under this Agreement; "Defaulting Party"is defined in Section 11.1; "Agreement Date"is defined in the preamble to this Agreement; "Environmental and Tax Attributes" means any and all benefits, emissions reductions, offsets, allowances, carbon credits, portfolio credits, environmental credits, renewable energy credits or certificates, emissions reduction credits, emissions allowances, green tags, rebates, subsidies, payments or other credits or incentives that are attributable to the System or the production or processing of biogas or renewable natural gas from the System or its displacement of conventional energy or fuel or avoidance of emissions,including investment Tax credits,production Tax credits, depreciation benefits,deductions and other Tax credits,Tax benefits,Tax incentives or Tax-related grants available under any Applicable Law relating to the construction, ownership or operation of, or production of energy from, the System; for the avoidance of doubt, "Environmental and Tax Attributes" includes credits generated for any state of Federal Low Carbon Fuel Standard and Federal Renewable Identification Numbers ("RINs") generated in accordance with the Energy Policy Act of 2005; "Environment" means soil, land, surface or subsurface strata, surface waters, groundwaters, drinking water supply, sediments, and ambient air. 506528698.4 "Environmental Law" means all Applicable Laws, including, without limitation, laws relating to consumer leasing and protection,pertaining to the environment,human health or safety, or natural resources, including, but not limited to, (a) releases of Hazardous Substances into the Environment; (b} the presence, manufacture, generation, processing, distribution, use, sale, treatment,recycling,receipt, storage, disposal,transport, arranging for transportation,treatment or disposal, or handling of any Hazardous Substances; or(c) imposing liability with respect to any of the foregoing. To the extent that it relates to the handling of and exposure to hazardous or toxic materials or similar substances, the term "Environmental Law" includes: the Comprehensive Environmental Response, Compensation and Liability Act of 1980(42 U.S.C. § 9601 et seq.),the Superfund Amendments and Reauthorization Act of 1986, the Emergency Planning and Community Right to Know Act (42 U.S.C. §§ 11001 et seq.), the Resource Conservation and Recovery Act of 1976 (42 U.S.C. §§ 6901 et seq.), the Clean Air Act(42 U.S.C. §§ 7401 et seq.), the Federal Water Pollution Control Act(also known as the Clean Water Act) (33 U.S.C. §§ 1251 et seq.), the Toxic Substances Control Act (15 U.S.C. §§ 2601 et seq.), the Safe Drinking Water Act (42 U.S.C. §§ 300f et seq.), the Endangered Species Act (16 U.S.C. §§ 1531 et seq.), the Migratory Bird Treaty Act (16 U.S.C. §§ 703 et seq.), the Bald and Golden Eagle Protection Act (16 U.S.C. §§668 et seq.),the Oil Pollution Act of 1990(33 U.S.C. §§2701 et seq.},the Hazardous Materials Transportation Act(49 U.S.C. §§ 5101 et seq.), and the Occupational Safety and Health Act of 1970 (29 U.S.C. §§ 651 et seq.), the regulations promulgated pursuant to the above-listed federal statutes, and any similar or analogous state and local statutes or regulations promulgated thereunder, as each of the foregoing may be amended or supplemented from time to time in the future, in each case to the extent applicable with respect to the property or operation to which application of the term"Environmental Law"relates; "Event of DefaulY'is defined in Section 11.1; "Force Majeure"is defined in Article 12; "Governmental Authority" means any national, state or local government (whether domestic or foreign), any political subdivision thereof or any other governmental, quasi-governmental, judicial, public or statutory instrumentality, authority, body, agency, bureau, commission, or entity, or any arbitrator with authority to bind a party under Applicable Law; "Hazardous Substance" means any (a) hazardous substance as defined by any Environmental Laws; (b) any petroleum or petroleum product, oil or waste oil; (c) any hazardous material, toxic substance, toxic pollutant, solid waste, municipal waste, industrial waste, hazardous waste, flammable material, radioactive material, pollutant or contaminant or words of similar meaning and regulatory effect under any applicable Environmental Laws; and (d) any other chemical, material, or substance (whether solid, liquid or gaseous) exposure to which or whose discharge, emission, disposal or release is prohibited, limited, or regulated under any applicable Environmental Laws. "Hazardous Substance" includes any mixture or solution of the foregoing, and all derivatives or synthetic substitutes of the foregoing; "Indemnified Party"and"Indemnified Parties" are defined in Section 9.1; "Indemnifying Party"is defined in Section 9.1; 506528698.4 "Opening Term"is defined in Section 1.1; "Opening Term Payment"is defined in Section 3.1; "Leased Property" means the portions of the Lessor Property identified in Exhibit C attached hereto; "Lessee" is defined in the preamble to this Agreement; "Lessee Improvements"is defined in Section 2.1; "Lessee Parties"is defined in Section 2.1; "Lessor" is defined in the preamble to this Agreement; "Lessor Mortgages"is defined in Article 15; "Lessor Parties" is defined in Section 8.2; "Lessor Property" means the real property, including all buildings and improvements, located in Franklin County, Washington as more particularly described in Exhibit B hereto; "Lien"means any lien, mortgage, security interest, charge,pledge or other encumbrance; "Memorandum of Lease"is defined in Section 16.1; "Party" and "Parties" are defined in the preamble to this Agreement; "Permitted Liens"is defined in Section 8.2; "Person" means any individual, corporation, partnership, limited partnership, proprietorship, association, limited liability company, firm, trust, estate or other enterprise or entity; "Renewal Term"is defined in Section 1.4; "Rent" is defined in Section 3.2; "System Activities"is defined in Section 5.1; "Taxes" means any and all federal, state, local or foreign tax, fees, levies, assessments, duties, imposts, tariffs or other charges of any kind imposed or authorized by a Governmental Authority; "Term" means the term of this Agreement, including the Opening Term and the Initial Term, as may be extended or renewed to the extent permitted under the provisions of this Agreement; "Transfer"is defined in Section 17.4(a); "Wastewater Treatment Agreement" or "WTA" means that certain Water Treatment Agreement attached as Exhibit E to this Agreement. 506528698.4 "year"means a consecutive twelve-month period. 506528698.4 EXHIBIT B LESSOR PROPERTY Description of Lessor Property The Lessor Property includes Lot 1 and Lot 2 as depicted in the Record of Survey included in this Exhibit B. Lot 2 is described below. Lot 1 is described in Exhibit C. Lot 2 That parcel of land being a portion of the South Half of the Northwest Quarter of the of Section 4, Township 9 North, Range 30 East,Willamette Meridian, Franklin County,Washington,described as follows: Beginning at the Southwest corner of said South Half; Thence North 88°45'19" East along the South line of said South Half, 2636.99 feet to the Southeast corner thereof; Thence North 03°16'11" East along the East line of said South Half, 1370.29 feet to the Northeast corner thereof; Thence South 88°53'S7"West along the North line of said South Half, 1334.97 feet; Thence South 00°02'45"West, 1131.07 feet; Thence South 88°53'39"West, 413.99 feet; Thence South 00°00'00" East, 120.00 feet; Thence South 88°45'20"West, 958.71 feet to the West line of said South Half; Thence South 03°06'31" West along the West line of said South Half, 119.99 feet to the POINT OF BEGINNING; Containing 45.62 acres, more or less. 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(p O � x ',,� o�� ���� z �r�o �_� r " �� : ��� p �� �� �i � Z � a��� � �pi t=n p� �b � w�3v�i$ � � �Z�°- � d �r-Oo —�— z ��' i O ��z�a C� o o Z � � � QW� � _������ � �-�� � � a � d o � ������s���� � �: �� � 6���'������� � ������������ - ��� � �_�° a ��e��� Y� °� ��° � v �' � ��:�s������� � ���g�� `� �R �d ���� � � 4�R���y��. �������e°� c°�.� j��p q°„ �������;��s� � ��������� �•a� � �F�� � � �� �..�:a b��t���lt���� �j ���`$�����E `"U � �� � ������� � ���������s � � � �s���������� �l` $ s yw.�r' o d� � ���C���8�� 3�� �.-a � � 3��+ N � as���r� �� y.•�i•• ���� ���� �° 3��� ` ____ s��R� ���������� ����� � �������� ����� ��������� � a� �R � s.�Q� ����� ����������� � 7� � ����� ��z3��a���� �� � �_$ �� �a������� ��� � ��°'� �`���E����� ��. � ����� g ���������$� ���� ���� � � � -.. �w... �,y. � N � f0 O � EXHIBIT C LEASED PROPERTY Description of Leased Property Lot 1 That parcel of land being a portion of The South Half of the Northwest Quarter of Section 4, Township 9 North, Range 30 East, W.M., records of Franklin County, Washington, described as follows: Beginning at the Southwest corner of said South Half; thence North 03°06'31" East along the West line of said South Half, 119.99 feet to the True Point of Beginning; thence continuing North 03°06'31" East along said West line 1256.65 feet to the Northwest corner of said South Half; thence North 88°53'S7" East along the North line of said South Half, 1305.39 feet; thence South 00°02'45" West, 1131.07 feet; thence South 88°53'39" West,413.99 feet; thence South 00°00'00" East, 120.00 feet; thence South 88°45'20" West, 958.71 feet to the True Point of Beginning. Also Known as Lot 1 of Record Survey recorded under Auditor's File No. 1969537. Parcel No. 113090085 506528698.4 EXHIBIT D Form of Memorandum of Lease [Attachment] 506528698.4 RECORDING REQUESTED BY AND AFTER RECORDING MAIL TO: Burnham SEV Pasco LLC 1201 Wilson Blvd—27th Floor Arlington, VA 22209 (Space Above for Recorder's Use Only) MEMORANDUM OF LEASE AND EASEMENT AGREEMENT , 20 THIS MEMORANDUM OF LEASE AND EASEMENT AGREEMENT (this "Memorandum") is entered into as of[_], by and between Burnham SEV Pasco LLC ("Lessee") and the City of Pasco ("Lessor") and refers to that certain Lease Agreement dated [_], entered into by and between Lessor and Lessee(the"Agreement"). Capitalized terms used but not defined herein shall have the meanings attributed to same in the Agreement. 1. Lessor has leased to Lessee the Leased Property described in Exhibit 1 attached hereto upon the terms and conditions specified in the Agreement. 2. Lessor is the owner of that certain real property located in Franklin County, Washington, legally described on Exhibit 2 attached hereto and incorporated herein by reference (the "Lessor Property"). The Leased Property comprises a portion of the Lessor Property. 3. The Agreement grants Lessee a non-exclusive easement and right of way over, across, under and through the Lessor Property, and any surrounding or nearby premises owned by Lessor, for Lessee, its employees, invitees, agents, contractors and subcontractors to access the Leased Property and to build, maintain, and install, among other things, any road, improvements, equipment, fences, gates, signs, communication lines or facilities as more specifically set forth in the Agreement. 4. The Opening Term of the Agreement commences on the Agreement Date and continues until the earlier to occur of(a) the COD and (b) the COD Longstop date. If COD does not occur within one hundred eighty(180)days after the COD Longstop date(i.e.,the COD does not occur}, then the Agreement shall terminate at the end of the Opening Term. The Initial Term commences on the COD, and continues for a period of thirty (30) years thereafter. The Agreement term automatically renews for two(2)additional five-year Renewal Terms unless terminated by Lessee. The easement rights granted by Lessor to Lessee pursuant to the Agreement are for a term coterminous with the Agreement. 5. The consideration given for the lease is indicated in the Agreement. 6. This Memorandum shall inure to the benefit of and be binding upon Lessor and Lessee and their respective successors and permitted assigns; provided, however, that this Memorandum is solely for public notice and recording purposes and shall not be construed to alter, modify, limit, 506528698.4 expand, diminish or supplement any of the terms or provisions of the Agreement or any of the rights granted to or covenants made by Lessor or Lessee under the Agreement. In the event of any conflict between the terms and provisions of this Memorandum and the terms and provisions of the Agreement, the terms and provisions of the Agreement shall prevail. This Memorandum shall continue to constitute notice of the Agreement, even if the Agreement is subsequently amended. 7. This Memorandum may be executed in any number of counterparts,each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Memorandum may be transmitted via facsimile or other electronic means and a manual or electronic signature of the undersigned transmitted via such means shall be deemed an original signature for all purposes and have the same force and effect as a manually-signed original. [SIGNATURE PAGES FOLLOW] 506528698.4 LESSEE BURNHAM SEV PASCO LLC, a Washington limited liability company By: Name: Title: Date STATE OF COUNTY OF This record was acknowledged before me on _, 20_ by as of the BURNHAM SEV PASCO LLC. (SignaZure of notary public) (Title ofo�ce) My Commission Expires: �Date� (Stamp) 506528698.4 LESSOR CITY OF PASCO, a Washington municipal corporation By: Name: Title: Date STATE OF COUNTY OF This record was acknowledged before me on _, 20_ by as of the CITY OF PASCO. (Signature ofnotary public) (Title of off ce) My Commission Expires: (Date) (Stamp) 506528698.4 EXHIBIT 1 DESCRIPTION OF LEASED PROPERTY That parcel of land being a portion of The South Half of the Northwest Quarter of Section 4, Township 9 North, Range 30 East, W.M., records of Franklin County, Washington, described as follows: Beginning at the Southwest corner of said South Half; thence North 03°06'31" East along the West line of said South Half, 119.99 feet to the True Point of Beginning; thence continuing North 03°06'31" East along said West line 1256.65 feet to the Northwest corner of said South Half; thence North 88°53'S7" East along the North line of said South Half, 1305.39 feet; thence South 00°02'45" West, 1131.07 feet; thence South 88°53'39" West,413.99 feet; thence South 00°00'00" East, 120.00 feet; thence South 88°45'20" West, 958.71 feet to the True Point of Beginning. Also Known as Lot 1 of Record Survey recorded under Auditor's File No. 1969537. Parcel No. 113090085 506528698.4 EXHIBIT 2 DESCRIPTION OF THE LESSOR PROPERTY The Lessor Property includes Lot 1 and Lot 2 as depicted in the Record of Survey included in this Exhibit B. Lot 2 is described below. Lot 1 is described in Exhibit C. Lot 2 That parcel of land being a portion of the South Half of the Northwest Quarter of the of Section 4, Township 9 North, Range 30 East,Willamette Meridian,Franklin County,Washington,described as follows: Beginning at the Southwest corner of said South Half; Thence North 88°45'19" East along the South line of said South Half, 2636.99 feet to the Southeast corner thereof; Thence North 03°16'11" East along the East line of said South Half, 1370.29 feet to the Northeast corner thereof; Thence South 88°53'S7"West along the North line of said South Half, 1334.97 feet; Thence South 00°02'45" West, 1131.07 feet; Thence South 88°53'39" West, 413.99 feet; Thence South 00°00'00" East, 120.00 feet; Thence South 88°45'20" West, 958.71 feet to the West line of said South Half; Thence South 03°06'31" West along the West line of said South Half, 119.99 feet to the POINT OF BEGINNING; Containing 45.62 acres, more or less. Together with and subject to easements, reservations, covenants and restrictions apparent or of record. 506528698.4 EXHIBIT E Wastewater Treatment Agreement [Attachment] 506528698.4