EXHIBIT 10.18
GROUND LEASE AGREEMENT (MOCANE PLANT)
THIS GROUND LEASE AGREEMENT (the "Lease") is made and entered into by
and between COLORADO INTERSTATE GAS COMPANY (the "Lessor") and CIG Field
Services Company (the "Lessee").
(COUNTY CLERK SEAL)
Lessor is the owner of the fee simple estate in that certain tract or
parcel of land lying and being situated in Beaver County, Oklahoma and described
more particularly in Exhibit A, attached hereto and incorporated herein by
reference for all purposes (the "Property"); and
Lessee has acquired from Lessor certain improvements located on those
portions of the Property designated as Areas 1 through 7 on Exhibit B, attached
hereto and incorporated herein by reference for all purposes (the "Leased
Premises"); and
Lessee desires to lease the Leased Premises;
THEREFORE, Lessor and Lessee agree as follows:
1. Demise; Quiet Enjoyment.
A. In consideration of Lessee's acquisition of certain assets
from Lessor and in consideration of the other terms, covenants, and conditions
of this Lease, Lessor does hereby LEASE, DEMISE, and LET unto Lessee, and Lessee
does hereby take and lease from Lessor, the Leased Premises, TO HAVE AND TO HOLD
the Leased Premises, together with all rights, privileges, easements and
appurtenances belonging to or in any way appertaining to the Leased Premises,
subject to any zoning and municipal ordinances, and upon and subject to the
terms, conditions and agreements hereinafter contained.
▇. ▇▇▇▇▇▇ has full right to make this Lease and, subject to
the terms and provisions of this Lease, Lessee shall have quiet and peaceable
enjoyment of the Leased Premises during the term hereof against every person
lawfully claiming the Leased Premises or any part thereof, by, through or under
Lessor, but not otherwise.
2. Term. This Lease shall be effective, and the tenancy created
hereunder shall commence, on the date set forth below. Such tenancy, subject to
the provisions of Section 7.B. hereof, shall remain in effect thereafter until
the date (the "Termination Date") that is the later of: (a) April 30, 2006; or
(b) eighteen (18) months after the date (the "Cessation of Operations Date")
that Lessee's equipment and/or facilities on the Leased Premises (the "Lessee
Facilities") permanently cease operating. However, in no event however shall the
Termination Date extend beyond April 30, 2102. Lessee shall provide Lessor with
at least six (6) months' notice of Lessee's intent to permanently cease
operation of the Lessee Facilities. Provided however, should the Lessee
Facilities fail to operate for a consecutive period of six (6) months or more,
except as a consequence of a casualty loss to the Lessee Facilities which Lessee
is proceeding to repair, replace or restore, the Cessation of Operations Date
shall be deemed to be the date that is the later of: (i) six (6) months from the
date the Lessee Facilities last operated; or (ii) sixty (60) days after Lessor
gives advance written notice of the Cessation of Operations Date in accordance
with Section 11 of this Lease (provided that the Lessee Facilities did not
operate during such 60 day period). Following the Termination Date, this Lease
shall terminate upon the completion of performance of all of Lessor's and
Lessee's obligations hereunder. However, in no event however shall the term of
this Lease extend beyond April 30, 2102.
3. Rental. This Lease is a "paid-up" lease and no further rental
payments are required.
Return acknowledgment to:
(STAMP)
CAPITOL SERVICES, INC.
▇.▇. ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
800/345-4647
4. Use of Leased Premises.
A. Lessee shall have the right to use the Leased Premises for
the purpose of gathering, processing, treating and transportation of natural gas
and related activities. Title to and ownership of any improvements currently
owned by Lessee or hereafter constructed by Lessee or any sublessee shall be and
remain in Lessee throughout the term of this Lease, and thereafter.
B. Following the Cessation of Operations Date (or, if
applicable, the date of termination of the tenancy under the provisions of
Section 7.B. of this Lease), Lessee shall proceed diligently to remove the
Lessee Facilities from the Leased Premises and restore the Leased Premises to a
condition that existed prior to its use. Such removal and restoration shall be
completed by no later than the Termination Date. If, in the sole judgment of
Lessor, Lessee has not removed the Lessee Facilities and restored the Leased
Premises by the Termination Date in compliance with the terms of this Lease, or
if the continued presence of the Lessee Facilities on the Property after the
Cessation of Operations Date (or, if applicable, the date of termination of the
tenancy under the provisions of Section 7.B. of this Lease) constitutes a
hazard, Lessor may remove the Lessee Facilities and restore the Leased Premises,
and Lessee shall be solely responsible for any and all reasonable costs and
damages incurred by the removal. The provisions of this Section 4.B. shall
survive termination of this Lease.
C. The additional provisions set forth in Schedule "1" to this
Lease shall apply to Lessee's activities and operations under this Lease.
5. Lessor's Reserved Rights; Lessee Grant.
A. Lessor reserves the right to fully use and enjoy the
Property, including the right to: (i) enter on the Leased Premises and the
Lessee Facilities at all times to inspect the Leased Premises, conduct
environmental and other analyses and determine Lessee's compliance with the
terms of this Lease; (ii) operate, repair, replace, remove and maintain
Lessor-owned pipelines and appurtenant facilities and equipment located now or
hereafter on the Leased Premises (the "Leased Premises Lessor Facilities"); and
(iii) construct and install additional facilities and equipment as deemed
necessary by Lessor for its operations on the Property. Provided however, the
foregoing rights of Lessor shall not conflict with any rights or privileges
granted to Lessee in this Lease.
B. Lessee grants Lessor the right, during the term of this
Lease, to operate, repair, replace, remove and maintain the Lessor-owned
communication equipment located within that certain Lessee building designated
with a red dot on Exhibit "B", including rights of ingress and egress within the
portion of such building where such equipment is located (the "CIG License").
Following the Cessation of Operations Date, Lessor shall proceed diligently to
remove such equipment from Lessee's building and restore that portion of the
building where such equipment was maintained to a condition that existed prior
to its use. Such removal and restoration shall be completed by no later than the
Termination Date. If, in the sole judgment of Lessee, Lessor has not removed
such equipment and restored such portion of such building by the Termination
Date in compliance with the terms of this Lease, or if the continued presence of
such equipment in such building after the Cessation of Operations Date
constitutes a hazard, Lessee may remove the equipment and restore such portion
of such building, and Lessor shall be solely responsible for any and all
reasonable costs and damages incurred by the removal. The provisions of this
Section 5.B. shall survive termination of this Lease.
C. The additional provisions set forth in Schedule "2" to this
Lease shall apply to Lessor's activities and operations under this Article 5.
6. Taxes.
A. Lessee agrees to pay and fully discharge all taxes, special
assessments and governmental charges of every character imposed during the term
of this Lease upon the Leased
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Premises, or any part thereof, and all improvements now owned, or hereafter
erected, by Lessee thereon, except that Lessee shall not be chargeable with any
taxes imposed under any existing or future laws of the United States or any
state or any political or taxing authority for: (i) income taxes on any revenues
of Lessor attributable to the Leased Premises; (ii) any ad valorem, gross
receipts, sales, excise or use taxes imposed on the Leased Premises Lessor
Facilities, or any revenues generated from the use (other than by Lessee) of,
the Leased Premises (including any amounts deemed to be rent); (iii) any gift,
capital gains tax, or other tax imposed on the transfer of the interest of
Lessor; (iv) any corporate franchise tax or corporate license fee levied upon or
against any Lessor; or (v) any taxes similar to any of the above excepted taxes.
B. Lessee shall have the right to contest the validity or
amount of any such taxes, charges and assessments which it is obligated to pay
under this Lease, in which event the payment thereof may be deferred during the
pendency of such contest, provided that such delay will not subject Lessor to
any criminal or civil liability, and that Lessee shall prosecute the contest
with due diligence. If requested by Lessee, Lessor shall join Lessee as a party
to any such contest. Lessee shall pay all penalties and interest related to such
taxes, charges and assessments which it is obligated to pay under this Lease.
7. Breach; Default; Remedies.
A. The failure of Lessee to comply with each term and
condition of this Lease shall constitute a breach of this Lease. Lessee shall
have sixty (60) days after receipt of written notice from Lessor of any breach
to correct the conditions specified in the notice. If the corrections cannot be
made within the 60-day period, Lessee shall have a reasonable time to correct
the default if action is commenced by Lessee within 60 days after receipt of the
notice. Provided however, in the event of a breach by Lessee that involves an
imminent health or safety risk to Lessor's personnel or facilities or an
imminent risk of damage to the environment, Lessee shall commence corrective
action immediately and shall pursue completion of such action as rapidly as is
possible.
B. In addition to its other rights and remedies, in the event
Lessee materially breaches this Lease and fails to make corrections as set forth
in Section 7.A., Lessor may reenter the Leased Premises immediately and
undertake corrective action at the expense of Lessee. After reentry, the tenancy
created under this Lease will terminate if Lessor gives sixty (60) days' advance
notice of termination to Lessee and such breach is not cured by Lessee by the
end of such period. Upon such termination: (i) Lessor may recover from Lessee
all damages proximately resulting from the breach, including, but not limited
to, the cost of corrective action; and (ii) Lessor may remove the Lessee
Facilities and restore the Leased Premises, and Lessee shall be solely
responsible for any and all reasonable costs and damages incurred by the
removal. The provisions of this Section 7.B. shall survive termination of this
Lease.
C. The prevailing party in an action to enforce any agreement
contained in this Lease, for breach of any covenant or condition, or respect to
any dispute regarding this Lease shall recover from the other party reasonable
attorney fees for the services of its legal counsel in such action (including
in-house counsel).
D. No waiver by either party of any default or breach of any
covenant, condition, or stipulation herein contained shall be treated as a
waiver of any subsequent default or breach of the same or any other covenant,
condition or stipulation hereof.
E. The bankruptcy or insolvency of Lessee, an assignment by
Lessee for the benefit of Lessee's creditors, the appointment of a trustee,
liquidator or receiver for Lessee, reorganization by Lessee, an admission by
Lessee of its inability to pay its debts as the same become due and/or the
seeking or granting of any order of relief in any proceeding commenced by or
against Lessee under any present or future federal or state bankruptcy,
insolvency or creditors' relief statute shall not affect this Lease so long
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as all covenants of Lessee are continued in performance by Lessee or its
successors or legal representatives.
8. Insurance. Lessee shall carry insurance in the types and minimum
amounts set forth on Schedule 3.
9. Compliance with Applicable Laws.
A. In connection with its activities and operations under this Lease,
Lessee, its contractors, subcontractors, engineers, agents and employees shall
comply with all federal, state, and local laws, rules and regulations, agency
policies, guidance documents or common law ("Applicable Laws"), including
Applicable Laws relating to Hazardous Substances (as hereinafter defined) and
those related to safety or pollution or protection of the public health and the
environment that govern the emission, discharge, release, storage, disposal, or
transportation of non-hazardous substances, materials, pollutants, contaminants,
chemicals, and/or waste. Lessee shall promptly respond to and clean up any
release or threatened release of any Hazardous Substance into the surface,
drainage systems, soil, surface water, groundwater, or atmosphere created as a
result of its access to, or operation or removal of, the Lessee Facilities as
required under Applicable Laws. If such a release of Hazardous Substances into
the surface, drainage systems, soil, surface water, groundwater, or atmosphere
occurs, Lessee shall, in its own name and in accordance with all Applicable
Laws, perform the work necessary to remediate such release as required under
Applicable Laws. As used herein, the term 'Hazardous Substances' shall mean any
substance which at any time shall be listed as 'hazardous' or 'toxic' under the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Sections 9601 et seq., as amended and the Resource Conservation and Recovery
Act, 42 U.S.C. Sections 6901 et seq., as amended, or in the regulations
implementing such statutes, or which has been or shall be determined at any time
by any agency or court to be a hazardous or toxic substance regulated under any
other Applicable Laws.
B. In connection with its activities and operations under the
provisions of Article 5 of this Lease, Lessor, its contractors, subcontractors,
engineers, agents and employees shall comply with all Applicable Laws, including
Applicable Laws relating to Hazardous Substances and those related to safety or
pollution or protection of the public health and the environment that govern the
emission, discharge, release, storage, disposal, or transportation of non-
hazardous substances, materials, pollutants, contaminants, chemicals, and/or
waste. Lessor shall promptly respond to and clean up any release or threatened
release of any Hazardous Substance into the surface drainage, systems, soil,
surface water, groundwater, or atmosphere created as a result of its access to,
or operation or removal of, the Leased Premises Lessor Facilities as required
under Applicable Laws. If such a release of Hazardous Substances into the
surface, drainage systems, soil, surface water, groundwater, or atmosphere
occurs, Lessor shall, in its own name and in accordance with all Applicable
Laws, perform the work necessary to remediate such release as required under
Applicable Laws.
10. Indemnity.
A. Lessee hereby indemnifies, defends and holds harmless
Lessor and its successors and assigns from and against any suits, actions, legal
or administrative proceedings, demands, claims, liabilities, fines, penalties,
losses, injuries, damages, expenses or costs, including interest, consultant
fees, and attorneys' fees, incurred by, claimed or assessed against Lessor under
any laws, rules, regulations including, without limitation, Applicable Laws
including any injury to any person or damage to any property or any loss to
Lessor occasioned in any way by or arising from: (i) the exercise by Lessee of
its rights hereunder; (ii) the failure of Lessee to exercise its rights
hereunder in compliance with all Applicable Laws; and (iii) the presence or
release of Hazardous Substances into the surface, drainage systems, soil,
surface water, groundwater, or atmosphere created as a result of Lessee's
obligations and
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rights granted hereunder. This indemnity shall survive the termination of this
Lease and specifically includes the obligation of Lessee as specified in this
Lease to perform any remedial or other activities required, or ordered, by any
agency, government official or court, to avoid or minimize injury or liability
to any person, or to prevent the spread of pollution.
▇. ▇▇▇▇▇▇ hereby indemnifies, defends and holds harmless
Lessee and its successors and assigns from and against any suits, actions, legal
or administrative proceedings, demands, claims, liabilities, fines, penalties,
losses, injuries, damages, expenses or costs, including interest, consultant
fees, and attorneys' fees, incurred by, claimed or assessed against Lessee under
any laws, rules, regulations including, without limitation, Applicable Laws
including any injury to any person or damage to any property or any loss to
Lessee occasioned in any way by or arising from: (i) the exercise by Lessor of
its rights under the provisions of Article 5 hereof; (ii) the failure of Lessor
to exercise its rights under the provisions of Article 5 hereof in compliance
with all Applicable Laws; and (iii) the presence or release of Hazardous
Substances into the surface, drainage systems, soil, surface water, groundwater,
or atmosphere created as a result of Lessors' obligations and rights granted
under the provisions of Article 5 hereof. This indemnity shall survive the
termination of this Lease and specifically includes the obligation of Lessor as
specified in this Lease to perform any remedial or other activities required, or
ordered, by any agency, government official or court, to avoid or minimize
injury or liability to any person, or to prevent the spread of pollution.
11. Notices and Addresses. Any notice, request, instruction, waiver or
other communication to be given hereunder by any party shall be in writing and
shall be considered duly delivered if personally delivered, mailed by certified
mail with postage prepared or sent by facsimile to the addresses of the parties
as follows:
Seller: Colorado Interstate Gas Company
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Director of Operations
Phone:(▇▇▇) ▇▇▇-▇▇▇▇
Fax:(▇▇▇)▇▇▇-▇▇▇▇
Buyer: CIG Field Services Company
Four ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn.: Director, Central Operations
Phone (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as either party may designate by written notice;
provided that: (i) if any notice is received by either party at a time other
than in its normal business hours on a business day, such notice will be deemed
to have been given on the next business day; and (ii) either party may specify
up to two persons or entities and two addresses for notices and other
communications hereunder.
12. Miscellaneous.
A. Nothing herein contained shall, nor any actions by Lessor
or Lessee be deemed or construed by the parties hereto, or any third party, as
creating the relationship of principal and agent or of partnership or of joint
venture between the parties hereto, it being agreed that this Lease and any
actions of the parties shall not be deemed to create any relationship between
the parties hereto other than the relationship of landlord and tenant.
B. Whenever herein the singular number is used, the same shall
include the plural, and words of any gender shall include each other gender. The
headings, captions, and arrangements used
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in this Lease are, unless specified otherwise, for convenience only and shall
not be deemed to limit, amplify, or modify the terms of this Lease, nor affect
the meaning thereof.
C. If any provision of any of this Lease is held to be
illegal, invalid, or unenforceable under present or future laws effective during
the term thereof, such provision shall be fully severable; this Lease shall be
construed and enforced as if such illegal, invalid or unenforceable provision
had never comprised a part hereof; and the remaining provisions hereof shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance therefrom. Furthermore,
in lieu of such illegal, invalid, or unenforceable provision, there shall be
added automatically as a part of this Lease a provision as similar in terms to
such illegal, invalid, or unenforceable provision as may be possible and be
legal, valid and enforceable.
D. This Lease shall be binding upon and inure to the benefit
of Lessor and Lessee, and their respective successors and assigns. The Lessor's
and the Lessee's respective rights and obligations hereunder shall be
assignable, without consent: (1) by Lessor, to a successor in title to the
Property and the Leased Premises Lessor Facilities, including a successor which
is a mortgagee in possession or a transferee as a result of a foreclosure sale;
and (2) by Lessee, to a successor in title to the Lessee Facilities, including a
successor which is a leasehold mortgagee in possession or a transferee as a
result of a foreclosure sale.
E. This Lease shall be governed by, enforced in accordance
with, and interpreted under, the laws of the State of Oklahoma, without regard
to its conflicts of law principles. To the extent that the rule against
perpetuities is applicable hereto, but not otherwise, it is agreed that the
lease hereunder granted to Lessee shall expire upon the earlier to occur of (i)
the last day of the term hereof, or (ii) twenty (20) years after the date of
death of the last to die of each presently living person that was born in a
hospital located in Dallas, ▇▇▇▇▇▇ or Bexar Counties, Texas during the calendar
year ending December 31, 2002.
F. This Lease was prepared jointly by the parties hereto and
not by either to the exclusion of the other.
EXECUTED effective as of May 1, 2003.
Lessor:
Colorado Interstate Gas Company
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ (APPROVED
------------------------ FOR EXECUTION
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ STAMP)
Vice President
Lessee:
CIG Field Services Company
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------
▇▇▇▇▇ ▇▇▇▇▇▇
Vice President
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STATE OF COLORADO ss.
ss.
COUNTY OF EL PASO ss.
This instrument was acknowledged before me on the 29th day of May, 2003
by ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, as Vice President of Colorado Interstate Gas Company, a
Delaware corporation, who stated that he executed same for the purposes and
consideration therein expressed and in the capacity therein stated, and as the
act and deed of said corporation.
(NOTARY
PUBLIC STAMP)
My Commission Expires:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Notary Public, State of Colorado
9/28/08
-----------------
STATE OF TEXAS ss.
ss.
COUNTY OF ▇▇▇▇▇▇ ▇▇.
This instrument was acknowledged before me on the 29th day of May, 2003
by ▇▇▇▇▇ ▇▇▇▇▇▇, as Vice President of CIG Field Services Company, a Delaware
corporation, who stated that he executed same for the purposes and consideration
therein expressed and in the capacity therein stated, and as the act and deed of
said corporation.
My Commission Expires:
/s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Notary Public, State of Texas
-----------------
(NOTARY ▇▇▇▇▇ ▇▇▇▇▇
PUBLIC MY COMMISSION EXPIRES
STAMP) October 18, 2006
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EXHIBIT A
Mocane Property:
An approximately 39.13 acre parcel in ▇▇▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇ ▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇ ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Oklahoma, consisting of the 80 acre parcel
described in that certain Warranty Deed from ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇
▇. ▇▇▇▇▇, Husband and Wife to Colorado Interstate Gas Company dated
April 18th, 1957, recorded in Book ▇▇▇, ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, less the 40.87 acres conveyed under Warranty Deed from
Colorado Interstate Gas Company to ▇▇▇▇▇▇ Petroleum Corporation, dated
November 7th, 1958, recorded in Book ▇▇▇, ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇.
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EXHIBIT B
DRAWING OF MOCANE FACILITIES
[CHART]
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SCHEDULE 1
In connection with its activities and operations under this Lease, Lessee,
its contractors, subcontractors, engineers, agents and employees shall comply
with the following Lessor safety policies and procedures dealing with personal
protective equipment:
Personal protective equipment must meet standards established by
recognized governmental and/or industry groups.
1. Newly acquired hardhats shall meet the minimum requirements set
forth by ANSI Z89.1.1997 (Type 1 or 2 - Class E Hardhats). Existing
hardhats shall meet the minimum requirements of the previous ANSI
Z89 standard defined by Class B.
2. Safety glasses equipped with rigid side ▇▇▇▇▇▇▇ meeting or exceeding
ANSI Z87.1.
3. Safety shoes meeting or exceeding ANSI Z41.1 (Compression and impact
ratings).
4. Fire retardant clothing shall meet Federal Test Standard CS-191
(<2.0 second after flame and <5.0 inches char length).
Local management is responsible for conducting personal protective
equipment hazard assessments for work exposures in their area of
responsibility. This assessment will be used as the foundation for
determining personal protective equipment needs.
The following rules require types of personal protective equipment for all
personnel, including contractors. Visitors in certain situations may not
be required to wear certain PPE.
Appropriate personal protective equipment includes but is not limited to
the following:
o Approved hard hats are to be worn in field operations and other
designated areas.
o Hearing protection must be worn in designated high noise areas. (85
dBA or higher).
o Approved safety eyewear with side ▇▇▇▇▇▇▇ are to be worn in field
operations and other designated areas. ANSI approved eyewear is to
be worn over non-ANSI approved safety eyewear or any not having side
▇▇▇▇▇▇▇;
o Safety shoes may be required when location management, PPE hazards
assessments or historical data/experience dictate the need. It is
the responsibility of local management to determine and enforce the
application and use of safety shoes at their locations;
o Hand protection appropriate for the task must be worn by personnel
when performing tasks which may cause injury to hands;
o Fire retardant clothing may be required when location management,
PPE hazards assessments or historical data/experience dictate the
need. It is the responsibility of local management to determine and
enforce the application and use of fire retardant clothing at their
locations;
o Additional eye/face protection such as goggles and/or a face shield
must be worn during grinding, welding, drilling, scraping or any
operation where foreign objects may enter the eye;
o Proper eye or face protection, respiratory protection, gloves and
aprons must be worn by personnel handling chemicals or other agents;
o Electrical lineman's gloves are to be provided when working with
high voltages and tested every six months by an approved independent
laboratory. Wearers of the lineman's gloves are to test for holes or
leaks prior to each use. Defective or damaged gloves must not be
used. Any glove found defective or damaged should be destroyed and
replaced immediately.
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Note: Prior to removing eye and face protection after performing any
operation where foreign objects may enter the eye, such as grinding and
stripping, bend at the waist and remove the debris from the top of the
eye/face protection.
Lessee agrees that it will at all times keep, operate, and maintain the
Lessee Facilities in a good, workmanlike and safe condition and in conformity
with good industry practices. Lessee also agrees to comply with all reasonable
requests made by Lessor for the purpose of insuring that the Lessee Facilities
are properly and safely maintained and operated and do not interfere with
Lessor's facilities, or constitute a nuisance in the vicinity of Lessor's
facilities.
Lessee shall take due care, when conducting any of the operations herein
granted, including the removal of the Lessee Facilities, to leave the surface of
the license herein granted in such condition that the original slopes, contour,
and surface of the lands shall not have been altered to an extent which will
interfere or hinder, or cause inconvenience to Lessor in its continued
operations or use of said land. It is further agreed and understood that all
areas disturbed in the performance of this grant and in compliance with the
conditions therefore, will be cleaned up, re-graded, contoured and re-seeded, or
otherwise restored, as applicable.
Lessee shall promptly pay and discharge any and all liens arising out of
any construction, alterations or repairs done, suffered or permitted to be done
by Lessee on the Leased Premises. Lessor is hereby authorized to post any
notices or take any action upon or with respect to the Leased Premises that is
or may be permitted by law to prevent the attachment of any such liens to the
Leased Premises or Lessor's facilities.
Lessee shall contact ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ at (▇▇▇) ▇▇▇-▇▇▇▇, 48 hours prior to
any construction or excavation activities on the Leased Premises or near
Lessor's facilities.
Any proposed gas lines shall be installed by Lessee over or under Lessor's
pipelines with a minimum vertical clearance of 24 inches between Lessee's lines
and Lessor's lines and the depth will remain constant across the Leased
Premises. The right of way will be marked for Lessee's information prior to any
construction or excavation activities.
The vertical separation between facilities must be maintained by the
placement of cement-sand bags, a shell pad or other positive separation between
facilities.
The operation of any excavating equipment upon, over or within 5 feet of
Lessor's facilities is prohibited unless authorized by Lessor's district office
or district personnel.
If a proposed line is of a metallic substance, a minimum of 2 cathodic
protection test leads must be installed at the crossing location or as directed
by Lessor's district corrosion personnel.
As part of its compliance with all federal, state and local laws that may
be applicable, Lessee shall notify the state "One Call" agency and have a
certified inspector on the job site during any trenching activities as required
by OSHA regulations.
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SCHEDULE 2
In connection with its activities and operations under the provisions of
Article 5 of this Lease, Lessor, its contractors, subcontractors, engineers,
agents and employees shall comply with the following Lessor safety policies and
procedures dealing with personal protective equipment:
Personal protective equipment must meet standards established by
recognized governmental and/or industry groups.
1. Newly acquired hardhats shall meet the minimum requirements set
forth by ANSI Z89.1.1997 (Type 1 or 2 - Class E Hardhats). Existing
hardhats shall meet the minimum requirements of the previous ANSI
Z89 standard defined by Class B.
2. Safety glasses equipped with rigid side ▇▇▇▇▇▇▇ meeting or exceeding
ANSI Z87.1.
3. Safety shoes meeting or exceeding ANSI Z41.1 (Compression and impact
ratings).
4. Fire retardant clothing shall meet Federal Test Standard CS-191
(<2.0 second after flame and <5.0 inches char length).
Local management is responsible for conducting personal protective
equipment hazard assessments for work exposures in their area of
responsibility. This assessment will be used as the foundation for
determining personal protective equipment needs.
The following rules require types of personal protective equipment for all
personnel, including contractors. Visitors in certain situations may not
be required to wear certain PPE.
Appropriate personal protective equipment includes but is not limited to
the following:
o Approved hard hats are to be worn in field operations and other
designated areas.
o Hearing protection must be worn in designated high noise areas. (85
dBA or higher).
o Approved safety eyewear with side ▇▇▇▇▇▇▇ are to be worn in field
operations and other designated areas. ANSI approved eyewear is to
be worn over non-ANSI approved safety eyewear or any not having side
▇▇▇▇▇▇▇;
o Safety shoes may be required when location management, PPE hazards
assessments or historical data/experience dictate the need. It is
the responsibility of local management to determine and enforce the
application and use of safety shoes at their locations;
o Hand protection appropriate for the task must be worn by personnel
when performing tasks which may cause injury to hands;
o Fire retardant clothing may be required when location management,
PPE hazards assessments or historical data/experience dictate the
need. It is the responsibility of local management to determine and
enforce the application and use of fire retardant clothing at their
locations;
o Additional eye/face protection such as goggles and/or a face shield
must be worn during grinding, welding, drilling, scraping or any
operation where foreign objects may enter the eye;
o Proper eye or face protection, respiratory protection, gloves and
aprons must be worn by personnel handling chemicals or other agents;
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o Electrical lineman's gloves are to be provided when working with
high voltages and tested every six months by an approved independent
laboratory. Wearers of the lineman's gloves are to test for holes or
leaks prior to each use. Defective or damaged gloves must not be
used. Any glove found defective or damaged should be destroyed and
replaced immediately.
Note: Prior to removing eye and face protection after performing any
operation where foreign objects may enter the eye, such as grinding and
stripping, bend at the waist and remove the debris from the top of the
eye/face protection.
Lessor agrees that it will at all times keep, operate, and maintain the
Leased Premises Lessor Facilities in a good, workmanlike and safe condition and
in conformity with good industry practices. Lessor also agrees to comply with
all reasonable requests made by Lessee for the purpose of insuring that the
Leased Premises Lessor Facilities is properly and safely maintained and operated
and do not interfere with the Lessee Facilities, or constitute a nuisance in the
vicinity of the Lessee Facilities.
Lessor shall render and pay directly to the pertinent local taxing
authorities all applicable property taxes on the Leased Premises Lessor
Facilities unless Lessor qualifies for an exemption therefrom. Any tax exemption
applications covering the Leased Premises Lessor Facilities shall be filed by
Lessor.
Lessor shall promptly pay and discharge any and all liens arising out of
any construction, alterations or repairs done, suffered or permitted to be done
by Lessor on the Leased Premises. Lessee is hereby authorized to post any
notices or take any action upon or with respect to the Leased Premises that is
or may be permitted by law to prevent the attachment of any such liens to
Lessee's interest in the Leased Premises or the Lessee Facilities.
Lessor shall contact ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ at (▇▇▇) ▇▇▇-▇▇▇▇, 48 hours prior to
any construction or excavation activities on the Leased Premises or near the
Lessee Facilities.
Any proposed gas lines shall be installed by Lessor over or under Lessee's
pipelines with a minimum vertical clearance of 24 inches between Lessor's line
and Lessee's and the depth will remain constant across the Leased Premises.
The vertical separation between facilities must be maintained by the
placement of cement-sand bags, a shell pad or other positive separation between
facilities.
If a proposed line is of a metallic substance, a minimum of 2 cathodic
protection test leads must be installed at the crossing location or as directed
by Lessee's personnel.
As part of its compliance with all federal, state and local laws that may
be applicable, Lessor shall notify the state "One Call" agency and have a
certified inspector on the job site during any trenching activities as required
by OSHA regulations.
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SCHEDULE 3
INSURANCE
A. Insurance Coverages/Limits.
Lessee and each of its subcontractors hereunder, if any, shall at its own
expense, obtain insurance as provided below from reliable insurance
companies acceptable to CIG and authorized to do business in the state or
area in which work is to be performed, with limits as specified in U.S.
currency or equivalent. Such insurance shall be in force at the time work
is commenced and shall remain in force for the duration of this Agreement,
unless a later date is specified below.
1. WORKERS' COMPENSATION AND EMPLOYER'S LIABILITY INSURANCE:
Workers' Compensation insurance or its' equivalent, including
Occupational Disease coverage, as required by law for all
employees, agents, and subcontractors. Employer's Liability
insurance (including Occupational Disease coverage) in the
amount of $1,000,000 PER ACCIDENT. Such insurance shall
provide coverage in the location in which work is performed
and the location in which Lessee is domiciled. Lessee
expressly agrees to comply with all provisions of the Workers'
Compensation Laws of the state(s) or country (ies) wherein
said work is being performed.
2. GENERAL LIABILITY INSURANCE: Commercial General Liability
insurance covering all operations by or on behalf of Lessee
against claims for bodily injury (including death) and
property damage (including loss of use). Such insurance shall
provide coverage for:
a) Premises and Operations;
b) Products and Completed Operations (which shall
remain in effect for a period of at least three
years following the completion and acceptance
date);
c) Contractual Liability;
d) Broad Form Property Damage (including Completed
Operations);
e) Explosion (X), Collapse (C) and Underground
Hazards (U); including XCU coverage under both
Premises/Operations and Contractual Liability;
f) Personal Injury Liability (with deletion of the
exclusion for liability assumed under Agreement);
g) Pollution Liability (sudden and accidental);
h) Independent Contractor's Contingent Liability;
i) Territorial Extension for the area in which the
work will be performed;
j) Action-over clause
with a MINIMUM LIMIT OF $1,000,000 PER OCCURRENCE for bodily
injury and property damage combined, provided that policy
aggregates, if any, shall apply separately to each annual
policy period. If this insurance is written on a claims made
policy form, then the policy shall be endorsed to include an
automatic extended reporting period of at least two (2) years.
3. AUTOMOBILE LIABILITY INSURANCE: Automobile Liability insurance
against claims of bodily injury (including death) and property
damage (including loss of use) covering all owned, rented,
leased, non-owned, and hired vehicles used in the performance
of work, with a MINIMUM LIMIT OF $1,000,000 PER ACCIDENT for
bodily injury and property damage combined and containing
appropriate uninsured motorist and No-Fault insurance
provision wherever applicable.
4. EXCESS INSURANCE: Excess (or Umbrella) Liability insurance
with a MINIMUM LIMIT OF $10,000,000 PER OCCURRENCE. This
insurance shall provide coverage IN EXCESS of the underlying
primary liability limits, terms, and conditions for EACH
category of liability insurance in the foregoing subsections
1, 2 and 3. This insurance shall be written on a following
form basis of underlying coverages, and the aggregate limits,
if any, shall apply.
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separately to each annual policy period. If this insurance is
written on a claims-made policy form, then the policy shall be
endorsed to include an automatic extended reporting period of
at least two (2) years.
B. ENDORSEMENTS.
1. All insurance policies to be maintained by Lessee shall be
endorsed to provide for a WAIVER OF SUBROGATION OR EQUIVALENT
ENDORSEMENT in favor of CIG, its' parent,
subsidiaries/affiliates including officers, employees, agents,
and parties for which it is operating.
2. All insurance policies, except Workers' Compensation and
Professional Liability, to be maintained by Lessee shall be
endorsed to:
a) Provide a Severability of Interests or Cross
Liability Clause;
b) Provide that the insurance shall be primary and
not excess to or contributing with any insurance
or self-insurance maintained by CIG;
c) Name CIG, its parent, subsidiaries/affiliates
including officers, employees, agents, and parties
for which it is operating as ADDITIONAL INSUREDS.
3. The Workers' Compensation and Employer's Liability Insurance
policy(ies) shall contain an alternate employer endorsement.
C. CERTIFICATES OF INSURANCE. Certificates of Insurance evidencing that
satisfactory coverage of the types and limits set forth above in
paragraphs A and B, shall be furnished to CIG upon request. Such
Certificates shall be in a form acceptable to CIG and shall contain
provisions that no policy coverage reductions or cancellations shall
become effective except upon 30-days written notice (10 days if due to
non-payment of premium) to CIG; provided, however, that no such coverage
reductions or cancellations shall relieve Lessee of its obligation to
maintain insurance in accordance with this Exhibit.
D. NO LIMITATION OF LIABILITY. In no event shall the amount or scope of the
insurance required by this section, place any limitation on the liability
assumed by Lessee elsewhere in this Agreement. Any and all deductibles or
self-insured retentions in the above-described insurance policies shall be
assumed by, for the account of, and at the sole risk of Lessee.
E. NO RELIEF OF OBLIGATIONS. Irrespective of the requirements as to insurance
to be carried by Lessee as provided herein, insolvency, bankruptcy, or
failure of any insurance company to pay all claims accruing, shall not be
held to relieve Lessee of any of its obligations.
F. TOTAL INSURANCE LEVEL. All limits as required above, may be met through
the use of primary and excess policies at the discretion of Lessee, so
long as the total level of insurance provided is equal to or greater than
the amount required by this insurance Exhibit.
G. LOSS INSURANCE. Insurance covering loss or damage to Lessee's or
subcontractor's property, including, but not limited to, tools, equipment,
machinery, trailers, temporary buildings or sheds owned, leased or rented,
shall be maintained by Lessee or subcontractor at its sole discretion and
at its own expense, and if such insurance is purchased, the policy shall
provide a waiver of subrogation rights against CIG.
H. RELATION TO INDEMNITY OBLIGATIONS. All insurance obligations under this
Exhibit shall be independent of the indemnity obligations contained in the
Agreement and shall apply regardless of whether the indemnity provisions
contained in the Agreement are enforceable.
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