This Agreement is dated for reference and made effective by Mattlater

VIEWS: 8 PAGES: 23

									                                             SCHEDULE C
                                               LEASE

THIS AGREEMENT made effective as of the             day of   , 2009.


BETWEEN:

                  SASKATCHEWAN POWER CORPORATION, a Crown corporation
                  incorporated under The Power Corporation Act (Saskatchewan) (“SaskPower”)

                                                  and

                    , a corporation incorporated under the laws of     (the “Supplier”)

WHEREAS:

A.       SaskPower is the owner of the Lands, located in the Province of Saskatchewan;

B.     The Supplier and SaskPower have entered into a Peaking Power Purchase Agreement for
the supply and purchase of electrical energy (the “PPA”);

C.      The Supplier wishes to conduct the Power Supply Operations on the Leased Area and
SaskPower is prepared to grant this lease for that purpose upon the terms and conditions set out
herein.

        NOW THEREFORE, in consideration of the mutual covenants herein contained the
Parties agree, each with the other, as follows:

1.       INTERPRETATION

1.1      Definitions

In this Lease, the following words and expressions whenever used, shall have the following
meanings:

           (a)    “Business Day” means a day that is not a Saturday, Sunday or statutory or civic
                  holiday in the Province of Saskatchewan;

           (b)    “Claim” or “Claims” means any claim, demand, action, proceeding, regulatory
                  investigation or order;

           (c)    (b) “Contaminants” means any radioactive or asbestos materials, urea
                  formaldehyde, hydrocarbons, pollutants, deleterious, poisonous, noxious,
                  dangerous, hazardous, corrosive or toxic substances or goods, special waste or
                  waste of any kind, or any other substance the storage, manufacture, disposal,
                  treatment, generation, use, transport, remediation or release into the Environment
                  of which is now or hereafter prohibited, controlled, or regulated under


Peaking PPA Lease v2.0 (April 1, 2009).DOC
      Environmental Laws and “substance” includes any sound, vibration, heat,
      radiation or other form of energy;

(d)   (c) “Environment” means air and the layers of the atmosphere, land (including
      soil, subsoil, sediments, consolidated surficial deposits and rock), water, organic
      and inorganic matter and living organisms and the interacting natural systems and
      ecological and climatic interrelationships that include the aforementioned
      components;

(e)   (d) “Environmental” means matters related directly or indirectly to the
          Environment;

(f)   (e) “Environmental Laws” means any and all laws and other standards,
      guidelines, policies and requirements having the force of law of or which are
      applied by any federal, provincial, municipal or other governmental authority
      having jurisdiction over the Leased Area, SaskPower or the Supplier now or
      hereafter in force relating in any way to the Environment, Environmental
      assessment, health, occupational health and safety or the manufacture, use,
      transportation, storage and disposal of Contaminants, including the related
      principles of common law and equity; and shall be deemed to include any such
      Environmental Laws of a provincial, municipal or local authority;

(g)   (f) “GST” means the Goods and Services Tax as provided for in the Excise Tax
      Act (Canada), or any successor or replacement legislation;

(h)   “Indemnitee” means the Indemnitee as identified and referred to in Section 8.3;

(i)   “Indemnitor” means the Indemnitor as identified and referred to in Section 8.3;

(j)   (g) “Initial Term” has the meaning ascribed thereto in Section 2.1;

(k)   (h) “Lands” means those lands legally described in Schedule “A”;

(l)   (i) “Leased Area” means the area outlined in red or cross-hatched on the Site Plan
      attached as Schedule “B”;

(m) “Loss” or “Losses” means injury or death, damage to or loss of property, costs,
    losses, damages, liabilities, fines, interest, penalties, legal fees and expenses
    arising from any Claim;

(n)   (j) “Party” means either SaskPower or the Supplier and “Parties” means
      collectively SaskPower and the Supplier;

(o)   (k) “Person” has the meaning ascribed thereto in the PPA;

(p)   (l) “Power Supply Operations” means the use of Supplier’s Facilities for the
      purpose of generating electricitypurposes specified in this Agreement and for any
      other lawful purpose incidental or ancillary thereto;


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         (q)   “Pre-Existing Contaminants” means those Contaminants in, on or under the
               Leased Area as shown in the Phase II environmental report dated and provided
               to the Supplier;

         (r)   (m) “Rent” has the meaning attributed thereto in Section 3.1;

         (s)   (n) “Supply Period” has the meaning ascribed thereto in the PPA;

         (t)   (o) “Supplier’s Facilities” means the electrical apparatus and equipment owned
               and operated by the Supplier located on the Leased Area.

All other capitalized terms used herein but not otherwise defined herein shall have the meaning
ascribed thereto in the PPA.

1.2    Interpretation

In this Lease except as otherwise provided, or unless the context otherwise requires:

        (a)    the words “herein” and “hereunder” and other words of similar import refer to this
               Lease as a whole and not to any particular provision hereof;

        (b)    headings inserted in this Lease are for convenience only and are not intended to
               interpret, define or limit the scope, extent or intent of this Lease or any provision
               hereof;

        (c)    words like “including”, “specifically” or “particularly” or words of similar import
               when following any general statement, term or matter, shall not be construed to
               limit such general statement, term or matter to the specific items or matters
               following such word or to similar items or matters, whether or not non-limiting
               language (such as “without limitation” or other words of similar import) is used
               with reference thereto but rather shall be deemed to refer to all other items or
               matters that could reasonably fall within the broadest possible scope of such
               general statement, term or matter;

        (d)    any reference to a statute includes amendments thereto, regulations made pursuant
               thereto, and to any statute or regulation that supplements, supersedes or replaces
               same;

        (e)    words importing one gender include all other genders, words in the singular
               include the plural and words importing individuals shall include firms and
               corporations, and, in each case, vice versa;

        (f)    if a word is defined in this Lease, a derivative of that word shall have a
               corresponding meaning; and

        (g)    where any date set in this Lease by which or on which some act, matter, event or
               thing is to occur falls on a date which is not a Business Day, then such date shall
               be changed to the next following Business Day.


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1.3    Schedules

The schedules to this Lease are as follows:

       Schedule “A”- Lands

       Schedule “B”- Leased Area

2.     LEASE

2.1    Grant of Lease

SaskPower hereby demises and leases the Leased Area to the Supplier to have and to hold the
Leased Area commencing on the date hereof and, subject to the Supplier’s right to renewextend
set forth in Section 10.1, ending on the date the Supply Period ends in accordance with the
termsand ending on the earlier of twenty-five years after the Commercial Operations Date (as
that term is defined in the PPA) or [twenty-seven] years after the date hereof, unless terminated
in accordance with the provisions of the PPAthis Agreement (the “Initial Term”).

The Supplier acknowledges and agrees that the Leased Area shall be used solely for the purposes
of constructing and operating the Supplier’s Facilities and conducting the Power Supply
Operations.

2.2    No Warranty

The Leased Area is leased to the Supplier on an as is, where is basis, and there are no warranties
or representations as to condition of the Leased Area or the nature or fitness for any purpose of
the Leased Area, either express or implied, and the Supplier hereby waives any such warranties
or representations that would otherwise be applicable to this Lease, the Leased Area or the
demise thereof to the Supplier.

2.3    Access to and Use of Lands

SaskPower grantsIn the event that the Leased Area does not have direct access to a public
roadway, SaskPower shall grant the Supplier, during the Initial Term and any renewal term the, a
non-exclusive right and, licence to utilize the common use areas of the Lands for egress and
ingress as is reasonably necessary for the conduct of the Power Supply Operations on the Leased
Area including vehicular and pedestrian trafficand easement of access, egress and ingress to and
from the Leased Area, as more particularly shown on the site plan attached as Schedule “B”, for
the Supplier and its permittees and their respective vehicles and supplies and equipment at all
time and for all purposes and things necessary for or incidental to the exercise and enjoyment of
the rights arising in respect of this Lease including the right to construct, operate, maintain and
repair the Supplier’s Facilities and all facilities and equipment incidental or ancialliary therto.

2.4 2.4 Quiet Enjoyment

DuringSubject to any public utility easements over the Leased Area, during the Initial Term (and
any renewal term) of this Lease and subject to the terms hereof, provided the Supplier is


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otherwise performing and observing the terms of this Lease, the Supplier shall peacefully and
quietly enjoy the use of the Leased Area solely for the purposes of conducting the Power Supply
Operations.




2.5 2.5 Assignment of Lease

The Supplier may not assign this Lease or any of its respective rights or obligations hereunder or
any interest herein without the prior written consent of SaskPower which consent may not be
unreasonably withheld or delayed. SaskPower may withhold its consent unless the proposed
Assignee first assumes and agrees to be bound by the terms of this Lease pursuant to an
agreement in writing which is in form and content satisfactory to SaskPower, acting reasonably.
Notwithstanding the foregoing, in the case of an assignment by the Supplier in favour of a
lender, such assignment shall be subject to SaskPower’s prior written consent to the lender
security arrangements on such terms as SaskPower may reasonably require. SaskPower agrees
to consent to such lender security, provided that Supplier and the lender execute the Consent to
Financing and Priority Agreement in substantially the form set forth in Schedule L of the PPA.

3.     RENT

3.1    Rent

       (a)     For and in consideration of the lease herein granted, SaskPower, during the Initial
               Term shall be paid rent annually by the Supplier in the amount of $1 plus GST
               (the “Rent”) and payable in advance on the first day of the Initial Term hereof and
               thereafter on each anniversary date of the commencement of the Initial Term
               hereof.

       (b)     The Rent shall be net to SaskPower free and clear of any expenses in connection
               with the construction, care, maintenance, operation, repair, replacement,
               alteration, addition, change, substitution, and improvement of or to the Supplier’s
               Facilities (all of which shall be the Supplier's responsibility). The Supplier shall
               reimburse SaskPower for any costs, outlays and expenses of any nature and kind
               whatsoever relating to or affecting the Leased Area or the Supplier’s Facilities
               paid by SaskPower.

       (c)     The Supplier will in each and every year of the Initial Term (and any renewal
               term) pay within thirty (30) days after the same shall become due and payable all
               municipal taxes, rates, duties, assessments, including local improvement rates,
               and other charges that may be levied, rated, charged, or assessed against the
               Leased Area and the Supplier’s Facilities and every tax and licence fee in respect
               of any and every business carried on thereon or therein by the Supplier (other than
               such taxes as corporate, income, capital, profits, or excess profits taxes assessed
               upon SaskPower), and all charges for utilities or services consumed by the
               Supplier, non-payment of which would create a lien or charge against the Leased


                                           -5-
               Area or the Lands, and will indemnify and keep indemnified SaskPower from and
               against payment of all losses, costs, charges, and expenses occasioned by or
               arising from any and all such taxes, rates, duties, assessments, charges and license
               fees. In the event that the Supplier shall fail to make the payments to be made by
               the Supplier as specified in this Section, SaskPower may, but shall not be
               obligated to, make such payment.

       (d)     If the Rent or any other amount payable hereunder by the Supplier to SaskPower
               shall be in arrears by more than thirty (30) days, such amount shall bear interest at
               the rate of ten percent (10%) per annumwhich is used by the Royal Bank of
               Canada or its successor as a reference rate for the purpose of determining rates of
               interest charged by it on Canadian dollar commercial demand loans made by it in
               Canada and which is quoted by such bank, from time to time as its “prime rate”
               plus two percent (2%) from the date the Rent or other amount is due until the date
               of actual payment, and SaskPower shall have all remedies for the collection of
               such interest, if unpaid, after demand, as in the case of rent in arrears, but the
               stipulation for interest shall not prejudice or affect any other remedies of
               SaskPower under this Lease.

       (e)     Outstanding amounts due to SaskPower pursuant to this Lease may be collected
               by SaskPower as if they were Rent and SaskPower's remedies contained in
               section 9 shall apply to the collection of such amounts.

4.     CONSTRUCTION OF SUPPLIER’S FACILITIES AND RIGHTS THERETO

4.1    Supplier to Construct Supplier’s Facilities

The Supplier, at its sole cost and expense, and in accordance with the PPA, shall construct or
cause to be constructed the Supplier’s Facilities, within the Leased Area expeditiously and in a
good and workmanlike manner in accordance with all federal, provincial and municipal building
and safety codes applicable to the Supplier’s Facilities, the Leased Area, the Lands and the
activities of the Supplier.

4.2    Other Duties of Supplier in Respect of Construction

Subject to the terms of the PPA, the Supplier shall:

       (a)     obtain all the necessary development and building permits and all other permits,
               consents and approvals from all federal, provincial and municipal governments,
               agencies and authorities necessary or desirable in respect of the construction of all
               buildings and improvements constituting the Supplier’s Facilities;

       (b)     be responsible for all worker and occupational health and safety duties,
               responsibilities and obligations with respect to all work performed on the Leased
               Area or in respect of the Supplier’s Facilities by or on behalf of the Supplier and
               shall indemnify and save harmless SaskPower from any liability for claims,
               damages or penalties, including legal fees on a solicitor and own client basis to
               defend any prosecutions or civil actions, arising from the Supplier' failure to


                                           -6-
               comply with the duties, responsibilities and obligations under any applicable
               worker or occupational health and safety legislation rules or regulations, whether
               federal, provincial or municipal;

       (c)     promptly pay when due all proper accounts for work done or materials supplied in
               respect of the construction of the Supplier’s Facilities; and

       (d)     not suffer or permit any lien under The Builders' Lien Act (Saskatchewan) or like
               statute to be registered against the title to the Leased Area or the Lands by reason
               of work, services or materials supplied or claimed to have been supplied to the
               Supplier or anyone acting on behalf of the Supplier. If any such lien is registered,
               the Supplier will do all things necessary, acting diligently and using best efforts,
               to obtain and register a discharge forthwith after such lien has come to the notice
               of the Supplier.

4.3    Removal of Supplier’s Facilities

The Supplier has the obligation (subject to SaskPower’s option to purchase the Supplier’s
Facilities set forth in the PPA) at the expiration of this Lease, at its own cost and expense, to
promptly and no later than 180[365] days following the expiration of the Lease, remove the
Supplier’s Facilities, including any building or foundations constructed as part of the Supplier’s
Facilities and to restore the Leased Area to the condition that existed immediately prior to the
commencement of this Lease, without limiting the generality of the foregoing, any foundations
constructed as part of the Supplier’s Facilities shall be removed to a depth of at least four feet
below ground level. Notwithstanding any other terms in this or any other agreement between the
Parties, including the PPA, the Supplier's removal obligations shall continue notwithstanding any
termination of this Lease. At the commencement of the final year of the Initial Term, if
requested by SaskPower, the Supplier shall provide performance security to SaskPower to ensure
compliance with this section 4.3 in such form and on such terms satisfactory to SaskPower,
acting reasonably.

4.4    SaskPower's Obligations

SaskPower shall, using its commercially reasonable efforts and acting reasonably, provide such
consents, approvals, authorizations and agreements, and do all such other things as may be
reasonably required to enable the Supplier to perform its obligations under this Section and this
Lease, provided that nothing herein shall obligate SaskPower to perform the Supplier's
obligations under this Section and this Lease.

5.     MAINTENANCE AND REPAIR

5.1    Maintenance and Repair of Supplier’s Facilities

The Supplier shall at its sole cost and expense be responsible for the maintenance and repair of
the Supplier’s Facilities and all improvements related thereto or otherwise now or hereafter
located within the Leased Area.

6.     ENVIRONMENTAL PROVISIONS


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6.1    Compliance with Environmental Laws

Notwithstanding any other covenants, agreements or obligations of the Supplier contained in this
Lease or the PPA:

       (a)    the Supplier shall at its own cost and expense observe and comply with all
              applicable Environmental Laws.

       (b)    except when a dispute or an action has been commenced in relation to
              environmental matters between the Parties, the Supplier shall promptly deliver to
              SaskPower a copy of any assessment, audit, report, or test results relating to the
              Environmental condition of the Leased Area conducted by or for the Supplier at
              any time before, during, or after the Initial Term (or any renewal term).

       (c)    the Supplier shall, at SaskPower’s reasonable request from time to time, provide
              SaskPower with a certificate of a senior officer of the Supplier stating that, to the
              best of its knowledge after having made reasonable inquiries, that the Supplier, is
              in compliance with all Environmental Laws and that no adverse Environmental
              occurrences have taken place at the Leased Area, other than as disclosed in
              writing to SaskPower.

6.2    Access by Landlord

       (a)    Without relieving the Supplier of any of its obligations under this Lease, the
              Supplier shall, at such reasonable times as SaskPower requires, upon twenty-four
              (24) hours prior written notice and in the presence of an authorized representative
              of the Supplier, permit SaskPower at its cost or its designated representatives to
              enter and inspect the Leased Area and the operations conducted at the Leased
              Area, to conduct Environmental tests and Environmental assessments and in that
              regard, to remove samples from the Leased Area, to carry out measurements or
              surveys in, on, below or above the Leased Area, to examine and make copies of
              any documents or records relating to the Environmental condition of the Leased
              Area, and to take such steps to determine the existence of any Contaminants in,
              on, below or above the Leased Area as SaskPower, acting reasonably, deems
              necessary for the safety and preservation of the Leased Area; PROVIDED THAT
              in so doing, SaskPower shall not unreasonably interfere with or detrimentally
              affect the operation of the Supplier's business except to the extent as may be
              necessary for the purposes hereinbefore described. SaskPower will provide the
              Supplier with copies of the results on any such tests and assessments in a timely
              fashion.

       (b)    SaskPower may, at any time, and from time to time, enter on the Leased Area to
              determine the existence of any substance in or on any part of the Leased Area
              which causes or contributes to an adverse Environmental condition, and for such
              purpose SaskPower may, without limitation, carry out soils, water, air,
              Environmental or other tests, measurements or surveys in, on or below the Leased
              Area or any part thereof.


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6.3   Environmental Events

      (a)   The Supplier shall promptly notify SaskPower in writing of any of the following
            events (an “Environmental Event”) of which the Supplier may become aware:

            (i)     any release of a Contaminant or any other occurrence or condition at the
                    Leased Area or any adjacent property that could contaminate or constrain
                    the use of the Leased Area or any adjacent property contrary to any
                    Environmental Law or subject the Supplier, SaskPower, or the Leased
                    Area to any fines, penalties, orders, investigations or proceedings under
                    Environmental Laws;

            (ii)    any administrative or judicial charge, order, investigation or notice of
                    violation or non-compliance under any Environmental Laws issued against
                    the Supplier relating to operations at the Leased Area or requiring the
                    Supplier to perform any remedial work; and

            (iii)   any notice, claim, action or other proceeding by any third party against the
                    Supplier or in respect of the Leased Area concerning the release or alleged
                    release of Contaminants at or from the Leased Area or the Environmental
                    condition of the Leased Area or the compliance with Environmental Laws
                    of the operations of the Supplier at the Leased Area.

      (b)   SaskPower shall promptly notify the Supplier of any Environmental Event which
            can reasonably be expected to impact the Leased Area of which SaskPower may
            become aware.

      (c)   The Supplier shall notify the appropriate regulatory authorities of any release of
            any Contaminants at or from the Leased Area in accordance with Environmental
            Laws, and failure by the Supplier to do so shall authorize, but not obligate,
            SaskPower to so notify the appropriate authorities.

      (d)   IfExcept to the extent that the Environmental Event is caused by SaskPower
            (including Pre-Existing Contaminants) if, during the Initial Term (or any renewal
            term) an Environmental Event takes place, the Supplier shall, at its own expense:

            (i)     as soon as practicable, give or cause to be given to SaskPower notice to
                    that effect and thereafter from time to time, give or cause to be given to
                    SaskPower, written notice of the extent and nature of the Supplier’s
                    compliance with the following provisions of this Section 1.16.3(d);

            (ii)    as soon as practicable, prepare all necessary studies, plans and proposals
                    and submit the same to SaskPower for approval, provide all bonds and
                    other security required by governmental authorities and, in accordance
                    with Environmental Laws, remediate or cause to be remediated to an
                    amount, concentration or level in compliance with Environmental Laws
                    any contamination of the Leased Area or any adjacent property resulting
                    from the Environmental Event, and shall keep SaskPower fully informed


                                        -9-
                    and provide to SaskPower full information with respect to proposed plans
                    and comply with SaskPower’s reasonable requirements with respect to
                    such plans;

            (iii)   if requested by SaskPower, obtain or cause to be obtained a certificate
                    from an independent consultant designated or approved by SaskPower,
                    verifying the complete and proper compliance with the requirements of
                    Environmental Laws or, if such is not the case, reporting as to the extent
                    and nature of any failure to comply with Environmental Laws;

            (iv)    as soon as practicable, cease or cause the cessation of any activity which
                    constitutes an Environmental Event and which causes or permits any
                    Contaminants to be released in, on, below or above the Leased Area or
                    any adjacent land, air or water or results in any Contaminants being
                    released into the Environment; and

            (v)     if requested by SaskPower, obtain or cause to be obtained a certificate
                    from an independent consultant designated or approved by SaskPower, as
                    the case may be, verifying that any activity referred to in Section
                    1.16.3(d)(iv) has ceased.

      (e)   For greater certainty, the obligations of the Supplier under Section 6.3(d)(ii) shall
            include the treatment of water, including surface and groundwater, and the
            remediation by removal of any soils containing Contaminants in amounts,
            concentrations or levels exceeding the standards set as acceptable at the time of
            remediation under Environmental Laws. Any soil so removed shall be promptly
            replaced by soil free of Contaminants in amounts, concentrations or levels above
            the standard described in the preceding sentence.

6.4   Removal of Contaminants

      (a)   The Supplier shall, except to the extent that the presence of the Contaminants was
            caused by SaskPower, at its own cost and expense promptly, and no later than
            180[365] days following the expiry or earlier termination of this Lease, remove
            any Contaminants that may have come onto, into or under the Leased Area or
            migrated thereunder or therefrom during the Initial Term (or any renewal term) of
            this Lease.

      (b)   Notwithstanding any other provision of this Lease, if at any time or upon the
            expiry or earlier termination of this Lease, in SaskPower’s reasonable opinion the
            Leased Area or any adjacent property is contaminated by Contaminants in an
            amount, concentration or level which exceeds that permitted under Environmental
            Laws as a result of the Power Supply Operations, then notwithstanding that no
            governmental authority has required any remedial action to be taken, the Supplier
            shall upon request from SaskPower and at its own expense, promptly take the
            measures set forth in Section 6.3(d)(ii) and (iii).




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       (c)     The Supplier shall provide or cause to be provided to SaskPower full information
               with respect to any remedial work performed pursuant to this Article 6 and shall
               comply with SaskPower’s reasonable requirements with respect to such work.

       (d)     The Supplier agrees that if SaskPower reasonably determines that SaskPower, its
               property, its reputation or the Leased Area is placed in any jeopardy by the
               requirement for any such remedial work, SaskPower may, but shall be under no
               obligation to, undertake such work or any part thereof at the cost of the Supplier.

6.5    Ownership of Contaminants

Notwithstanding any rule of law to the contrary, any Contaminants or improvements or goods
containing Contaminants brought onto, used at or released from the Leased Area by the Supplier,
or any Person for whom the Supplier is in law responsible, shall be and remain the sole and
exclusive property of the Supplier and shall not become the property of SaskPower,
notwithstanding the degree of their affixation to the Leased Area and notwithstanding the expiry
or earlier termination of this Lease. This clause supersedes any other provision of this Lease to
the contrary.

6.6    Survival of Supplier’s Obligations

       (a)     The obligations of the Supplier under this Article 6 including the Supplier’s
               obligation to remove and remediate Contaminants, shall survive the expiry or
               early termination of this Lease. If, after the expiry or early termination of this
               Lease, the performance of those obligations by the Supplier requires access to the
               Leased Area, the Supplier shall have such access and entry at such times and upon
               such terms and conditions as SaskPower may, from time to time, specify, acting
               reasonably.

       (b)     The obligations of the Supplier under this Article 6 are in addition to, and shall
               not limit, the obligations of the Supplier contained in other provisions of this
               Lease.

7.     INSURANCE

7.1    Insurance

The Supplier agrees that it shall obtain, pay for and maintain property insurance on the
Supplier’s Facilities during the Initial Term and any renewal term in such amount and to such an
extent as would a prudent owner of such facilities. In addition, the Supplier shall obtain, pay for
and maintain in force throughout the Initial Term and any renewal term the following minimum
liability insurance coverage, with insurers authorized to do business in the province of
Saskatchewan.

       (a)     Employers' Liability and Workers' Compensation Insurance providing statutory
               benefits in accordance with the laws and regulations of the Province of
               Saskatchewan. The minimum limits for the Employers' Liability Insurance shall
               be $1,000,000 per occurrence.


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       (b)     Commercial General Liability Insurance with a minimum limit of $2,000,000 per
               occurrence and $2,000,000 products and completed operations coverage, covering
               all amounts that Supplier becomes legally obligated to pay as damages arising
               from personal injury (including death), property damage (including loss of use)
               and non-owned automobile liability.

       (c)     Automobile Third Party Liability Insurance for coverage of owned and non-
               owned and hired vehicles, not otherwise insured by the Commercial General
               Liability Policy, with a minimum, combined single limit of $2,000,000 per
               occurrence for bodily injury (including death), and property damage (including
               loss of use).

       (d)     Excess Liability Insurance over and above the Employers' Liability, Commercial
               General Liability and Automobile Third Party Liability Insurance coverage, with
               a minimum combined single limit of $20,000,000 per occurrence.

       (e)     Any other insurance that the Supplier is required by law to provide or that
               Supplier deems appropriate to protect its interests for risks assumed under this
               Lease or otherwise.

       (f)     The minimum liability insurance coverage levels noted in Sections 7.1(a) to 7.1(e)
               may be reviewed and revised at SaskPower’s discretion as required from time to
               time to compensate for the impact of inflation. No adjustments will be made in
               the first 10 years after the commencement of the Supply Period.

       (g)     The Supplier shall provide SaskPower with satisfactory proof of insurance
               coverage required by this Section 7.1 prior to the Supplier entering upon the
               Leased Area and thereafter annually.

7.2    Terms of Insurance

The Supplier shall ensure that each of the insurance policies listed in Section 7.1, must:

       (a)     defend and include SaskPower as an “additional insured” on a primary basis for
               liability arising out of or in relation to the Supplier’s work or operations
               performed under or incidental to this Lease, except for the coverage described in
               Section 7.1(a);

       (b)     provide for at least 30 days’ written notice being given to SaskPower before any
               coverage is cancelled or any change material to the interests of SaskPower is
               effected;

       (c)     be primary insurance and non-contributing with any insurance or self-insurance
               program maintained by SaskPower; and

       (d)     contain provisions whereby the Supplier’s insurer waives all rights of recovery,
               under subrogation or otherwise, against SaskPower.



                                           - 12 -
The requirements contained in this Article 7 as to the types and limits of insurance to be
maintained by the Supplier are not intended to and shall not in any manner, limit or qualify the
liabilities and obligations assumed by the Supplier under this Lease.

7.3    Insurance Risks

The Supplier shall not do, omit to do, or permit to be done or omitted to be done upon the Lands,
the Leased Area or any other portion of the Supplier’s Facilities anything that may contravene or
be prohibited by any of SaskPower's insurance policies in force from time to time covering or
relevant to any part of the Supplier’s Facilities or which would prevent SaskPower from
procuring such policies with insurers acceptable to SaskPower. If the occupancy of the Leased
Area, the conduct of business in the Leased Area or any acts or omissions of the Supplier in the
Leased Area or any other portion of the Supplier’s Facilities causes or results in any increase in
premiums for any of SaskPower's insurance policies, then, without limiting any other rights or
remedies of SaskPower, the Supplier shall pay any such increase forthwith upon receipt of the
invoices of SaskPower for such additional premiums.

7.4    Release of SaskPower

The Supplier hereby releases SaskPower from any and all claims, actions, causes of action,
damages, demands for damages and other liabilities, howsoever arising, that may be made by
the Supplier against SaskPower under the provisions of this Lease to the extent of all insurance
proceeds paid under the policies of insurance maintained by the Supplier or which would have
been paid if the Supplier had maintained the insurance required under this Lease and had
diligently processed any claims thereunder. In addition and without limitation, the Supplier
agrees that SaskPower, regardless of negligence or alleged negligence on the part of SaskPower
or any breach of this Lease by SaskPower and, notwithstanding anything else herein contained,
shall not be liable for and the Supplier hereby release SaskPower from:

       (a)     any and all claims, actions, causes of action, damages, demands for damages and
               other liabilities:

               (i)    for or related to any bodily injury, personal injury, illness or discomfort to
                      or death of any of the Supplier’s agents, officers, contractors, employees,
                      invitees, or any other Person for whom the Supplier is legally responsible
                      in or about the Supplier’s Facilities or the Leased Area; and

               (ii)   for or related to any loss or damage to property owned by the Supplier or
                      by others and for which property the Supplier is responsible in or about
                      the Supplier’s Facilities or the Leased Area;

       (b)     any loss or damage caused as a result of any damage, destruction, construction,
               alteration, expansion, expropriation, reduction, repair or reconstruction from time
               to time of the Supplier’s Facilities, any parts or components of the Supplier’s
               Facilities or of any improvements thereto;

       (c)     any indirect or consequential damages including, but not limited to, loss of
               profitwith respect to the condition of the Leased Area.


                                          - 13 -
7.5    SaskPower Insurance

In the event the Supplier fails to place insurance as required in this Lease, SaskPower may (but
shall not be obliged) during the Initial Term (and any renewal term) to obtain and maintain and
keep in force for the mutual benefit of the Supplier and SaskPower such insurance as SaskPower
may, in its unfettered discretion, determine as prudent in connection with the Leased Area
including insurance against fire and extended perils to the full replacement cost and general
public liability insurance against claims for personal injury, death or property damage occurring
in, or about the Leased Area. The Supplier shall reimburse SaskPower for the cost of such
insurance on demand.

8.     INDEMNITY BY SUPPLIER

8.1    Indemnity byof Supplier

The Supplier shall be liable to SaskPower for, and as a separate and independent covenant
shalldefend, indemnify and save harmless SaskPower’s officers, directors, employees and agents,
from and against, any and all claims, actions, causes of action, damages, demands for damages,
losses and other liabilities and expenses (including, without limitation, those in connection with
bodily injury (including death), personal injury, illness or discomfort or damage to property and
legal fees on a solicitor and own client, full indemnity basis) due to or arising from or out of all
Claims made or brought against and all Losses suffered by SaskPower, directly or indirectly, to
the extent that such Claim or Loss arises as a result of: (i) the Supplier’s acts or omissions related
to this Lease; (ii) the performance of the Supplier’s obligations under this Lease or the
Interconnection Agreement; or (iii) any occurrence in, on or at the Leased Area or the occupancy
or use by the Supplier of the Leased Area or any other part of the Supplier’s Facilities or conduct
of the Power Supply Operations or occasioned wholly or in part by any act or omission of the
Supplier, its officers, employees, agents, contractors, invitees, or by any Person permitted by the
Supplier to be on, in or about, the Leased Area or the Supplier’s Facilities or due to or arising out
of any breach by the Supplier of this Lease. This indemnification shall survive the expiration or
termination of this Lease.; except to the extent such Claim or Loss results from SaskPower’s
breach of its obligations under this Lease, negligence or willful misconduct. This indemnity
shall survive the termination of this Agreement.

8.2    Indemnity by SaskPower

SaskPower shall defend, indemnify and save harmless the Supplier’s officers, directors,
employees and agents, from and against all Claims made or brought against and all Losses
suffered by the Supplier, directly or indirectly, to the extent that such Claim or Loss arises as a
result of SaskPower’s acts or omissions arising out of or related to this Lease or the performance
of its obligations under this Lease or the Interconnection Agreement, except to the extent such
Claim or Loss results from the Supplier’s breach of its obligations under this Lease, negligence
or willful misconduct. This indemnity shall survive the termination of this Agreement.

8.3    Amount of Claim

In the event that pursuant to this Article 8 either Party as Indemnitor is required to indemnify the
other as Indemnitee, the amount which the Indemnitor shall be required to pay to the Indemnitee

                                            - 14 -
with respect to any Claim or Loss shall be the full amount of all such Claims and Losses and all
costs or expenses incurred in defending or dealing with such Claims net of the present value of
any tax benefits associated with such Claims or Losses.

8.4    Notice of Claim

The Indemnitee shall, promptly upon the discovery by the Indemnitee of the existence of a
Claim to which this Article 8 applies, the Indemnitee shall notify the Indemnitor in writing of
such Claim setting out, to the extent reasonably feasible, full and detailed particulars of the
Claim including, without limitation, the nature of and specific basis for such Claim and the
estimated amount of such Claim (which estimate shall not be conclusive of the final amount of
such Claim).

8.5    Effect of Failure to Give Notice

In the event that the Indemnitee fails to give to the Indemnitor the notice required by this Article
16 with respect to any Claim then, to the extent that the Indemnitor is materially prejudiced by
such failure, the obligation of the Indemnitor to indemnify the Indemnitee pursuant to this
Article 16 shall cease with respect to such Claim.

8.6    Right to Dispute

The Indemnitor shall at all times have the right, at its sole expense and with counsel of its choice,
to dispute and contest (in the name of the Indemnitee, where necessary), any Claim for which the
Indemnitor is liable pursuant to this Article 8. The Indemnitor shall not make any admission of
liability or guilt on behalf of the Indemnitee in respect of any Claim without the prior written
consent of the Indemnitee.

8.7    Right to Books and Records

In the event that the Indemnitee refuses to deliver to the Indemnitor any books, records or other
documentation reasonably required by the Indemnitor in order to defend any Claim in connection
with which the Indemnitee is seeking indemnification pursuant to this Article 8, then to the
extent that the Indemnitor is materially prejudiced by such refusal, the obligation of the
Indemnitor to Indemnify the Indemnitee pursuant to this Article 8 shall cease with respect to
such Claim.

8.8    Right to Cure

The Indemnitor shall have the right to cure within a reasonable time and in a manner satisfactory
to the Indemnitee, acting reasonably, any matter giving rise to a Claim, provided however, that
any such cure shall not relieve or reduce any such Claim arising prior to, during or because of
such cure to the extent that such cure is inadequate.




                                           - 15 -
8.9    Consequential or Punitive Damages

Notwithstanding any provision of this Lease, neither Party shall be liable hereunder or under any
cause of action to the other Party for such other Party’s indirect, consequential, special,
exemplary or punitive damages including, without limitation, loss of profits sustained or claimed
by the other Party.


9.     SUPPLIER DEFAULT AND SASKPOWER'S REMEDIES

9.1     Default Under this Lease

The Supplier shall, except as hereafter provided, be in default under this Lease (each an “Event
of Default”) if:

       (a)    any payments of the Rent or any part thereof, whether the same are demanded or
              not, are not paid when they become due and non-payment shall continue for
              thirty (30) days after written notice thereof to the Supplier by SaskPower

       (b)    any material breach, non-observance or non-performance of any covenant,
              agreement, stipulation, proviso, condition, rule or regulation herein contained on
              the part of the Supplier to be kept, performed or observed hereunder and any
              such breach, non-observance or nonperformance shall continue for thirty (30)
              days after written notice thereof to the Supplier by SaskPower, provided that if
              the Supplier is attempting to remedy or remediate such breach, non-observance
              or non-performance, the Event of Default, shall not occur as long as the Supplier
              is making reasonable efforts and the breach, non-observance or non-performance
              is capable of being remedied or remediated;

       (c)    the Leased Area or the Lands shall be used for any purpose other than that for
              which they were let without the prior written consent of SaskPower, and such
              unauthorized use continues for a period of more than thirty (30) days after
              written notice thereof to the Supplier by SaskPower;

       (d)    the Supplier shall abandon the Leased Area or cease to carry on the Power
              Supply Operations from the Leased Area (other than cessations of a temporary or
              non-permanent nature), and such abandonment or cessation continues for a
              period of thirty (30one hundred and twenty (120) consecutive days;

       (e)    the Supplier shall make any assignment for the benefit of its creditors or any bulk
              sale, become bankrupt or insolvent or take the benefit of any statute now or
              hereafter in force for bankrupt or insolvent debtors; or

       (f)    the Supplier shall take any steps or suffer any order to be made for the winding
              up or other termination of its corporate existence.



                                          - 16 -
If an Event of Default is not remedied or remediated by the Supplier within the time periods
specified above or after receipt of written notice of default by the Supplier from SaskPower then
SaskPower may, at its option, terminate this Lease, in addition to and without prejudice to
exercising any other rights and remedies of SaskPower available to it either by any other
provision of this Lease, by statute or the general law or the rights and remedies of SaskPower
set forth in the PPA.

9.2    Waiver

If SaskPower shall overlook, excuse, condone or suffer any default, breach or non-observance
by the Supplier of any obligation hereunder, this shall not operate as a waiver of the obligation
in respect of any continuing or subsequent default, breach or non-observance and no such
waiver shall be implied but shall only be effective if expressed in writing. Subject to applicable
law, SaskPower's acceptance of Rent after a default is not a waiver of any preceding default
under this Lease even if SaskPower knows of the preceding default at the time of acceptance of
the Rent. No term, covenant or condition of this Lease shall be considered to have been waived
by SaskPower or the Supplier unless the waiver is in writing. The Supplier waives any statutory
or other rights in respect of abatement, set-off or compensation in its favour that may exist or
come into existence hereafter with respect to Rent.

10.    RIGHT TO RENEW

10.1   Renewal

Provided SaskPower has not exercised its option to purchase the Supplier’s Facilities and
provided the Supplier is not in default of any covenants within the Lease, the Supplier shall be
entitled to an option to renew this Lease for an additional term of ten (10) years (the “Renewal
Term”) to be exercised on not less than six (6) months written notice to SaskPower, prior to
the expiration of the Initial Term. Any such renewal of this Lease shall be on the same terms
and conditions as contained in this Lease, excepting as to renewal, and excepting as to Rent.
The Rent for the Renewal Term shall be consistent with the then current fair market rates for
similar parcels, asthe Leased Area as vacant land without any improvements made by or for the
Supplier or SaskPower and after disregarding the fact that the Supplier operates the Supplier’s
Facilities on the Leased Area and that the Supplier otherwise uses the Leased Area for the
purposes permitted under this Lease and after further disregarding the fact that the Supplier, as
incumbent tenant, might pay greater rental to avoid the cost or inconvenience of relocating, as
may be agreed upon by the Parties not less than three (3) months prior to the expiry of the Initial
Term. If the Parties are unable to agree upon the Rent for the Renewal Term not less than three
(3) months prior to the expiry of the Initial Term, the Parties shall refer the matter to arbitration
pursuant to The Arbitration Act (1992).

11.    GENERAL

11.1   Severability

Any term, condition or provision of this Lease which is deemed to be void, prohibited or
unenforceable shall be severable herefrom without in any way invalidating the remaining terms,
conditions and provisions hereof.

                                            - 17 -
11.2   Enforcement of Remedies

Any remedy which may be available to a Party by virtue of any provision contained in this
Lease and as a consequence of the default of another Party shall be in addition to and not by
way of substitution for any statutory, common law or equitable remedy which may also be
available and all such remedies may be enforced either successively or concurrently.

11.3   Further Assurances

Each Party will promptly and duly execute and deliver to the other Party such further documents
and assurances and take such further action as the other Party may from time to time reasonably
request in order to more effectively carry out the intent and purpose of this Lease and to
establish and protect the rights and remedies created or intended to be created hereby.

11.4   Notices

Any notice or acceptance required or other communication required or permitted to be given
under the terms of this Lease shall be shall be sufficiently given to the party to whom it is
addressed if delivered to the Party (or if the Party is a corporation, to an officer of that Party); or
if forwarded both: (i) by a reputable overnight courier, and (ii) by
facsimile transmission as follows:

to SaskPower at:



Fax: ( )

Attention:

and with a copy to:



Fax: ( )

Attention:

and to the Supplier at:



or to such other address or facsimile number as a Party may furnish in writing to the remaining
parties from time to time. Any notice personally delivered before 4:30 p.m. local time at the
place of delivery on a Business Day at the place of delivery shall be deemed to have been
received and given on the day of delivery and any notice personally delivered after 4:30 p.m.
local time at the place of delivery shall be deemed to have been received and given on the next
following Business Day. Any notice transmitted by facsimile before 4:30 p.m. local time on a
Business Day at the place to which it is sent shall be deemed to have been received and given on


                                             - 18 -
the day of transmission and any notice transmitted by facsimile after 4:30 p.m. local time at the
place to which it is sent shall be deemed to have been received and given on the next following
Business Day. Any notice sent by courier and facsimile, as aforesaid, shall be deemed to have
been received, as set forth above, on the day of delivery by courier and the day the facsimile is
received, or the earlier of those days if they are not the same day.

11.5   Alteration of this Lease

No change or modification to this Lease shall be valid unless it shall be in writing and signed by
each of the Parties hereto.

11.6   Governing Law

This Lease shall be construed and enforced in accordance with, and the rights of the parties
hereto shall be governed by, the laws of the Province of Saskatchewan. Each of the Parties hereto
hereby irrevocably attorns to the jurisdiction of the courts in the Province of Saskatchewan.

11.7   Time

Time shall be of the essence of this Lease.

11.8   Enurement

This Lease and everything herein contained shall enure to the benefit of and be binding upon the
Parties together with their successors and permitted assigns.

11.9   Execution in Counterpart

This Lease may be executed in two or more counterparts, each of which shall be deemed an
original and all of which together shall constitute one and the same instrument. It shall not be
necessary that any single counterpart hereof be executed by both Parties to this Lease so long as
at least one counterpart is executed by each such Party. For the purposes of this Lease any Person
who has acknowledged in writing that he has signed a counterpart of this Lease shall be
conclusively deemed to have executed same.




                                              - 19 -
11.10 Delivery by Facsimile

This Lease shall be deemed to be validly executed and delivered by a Party when a copy thereof
has been executed by that party and transmitted by facsimile to the other Party. A Party
delivering this Lease by facsimile as aforesaid covenants to promptly deliver to the other Party
originally executed copy of this Lease by ordinary mail or by courier.

IN WITNESS WHEREOF the parties hereto have executed this Lease as of the day and year
first above written.



 SASKATCHEWAN POWER
 CORPORATION

 Per:_____________________________                Per:______________________________
      _                                                Name:
      Name:                                            Title:
      Title:
                                                  Per:______________________________
 Per:_____________________________                     Name:
      _                                                Title:
      Name:
      Title:




                                         - 20 -
Schedule “A”

Leased Lands




 - 21 -
Schedule “B”

Leased Area




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Document 2          pcdocs://regina/658860/10
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