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INDENTURE OF LEASE EXECUTED BY UNITED STATES OF AMERICA
ATOMIC ENERGY COMMISSION AND WASHINGTON PUBLIC POWER SUPPLY SYSTEM
This Indenture of Lease, entered into this
day of 1962, between the United States of America (hereinafter called the "Government'), represented herein by the United States Atomic Energy Commission (hereinafter called the “Commission”) and the Washington Public Power Supply System (hereinafter called the “Supply System"), a municipal corporation, joint operating agency and publicly owned utility organized under the laws of the State of Washington.
(a) The Government, acting by and through the Commission, he constructed at its Hanford Works in the vicinity of Richland, Washington, a new production reactor (hereinafter called the "NPR") which produces energy in the form of steam suitable for the generation of electric power.
(b) The Supply System is authorized by law to construct, acquire and operate works, plants and facilities for the generation of electric power. The Supply System has constructed an electric power generating plant (hereinafter called the “Generating Plant”) having an ultimate capacity of approximately 860 gross megawatts, in the immediate vicinity of the NPR, on federally owned land leased from the Commission.
(c) The Commission pursuant to authority contained in the Atomic Energy Act of 1954, as amended, on
1962, entered into a contract (hereinafter called the “Operating and Construction Contract”) to sell to the Supply System excess steam energy produced by the Commission incident to the Commission's operation of the NPR.
(d) The Commission is authorized to lease to the Supply System the NPR for the generation of steam energy during such times that the Commission suspends its operation of the NPR.
INSTRUMENT OF LEASE
1. Conveyance of Interest in Land and Facilities
The Government, lessor, for and in consideration of the rents, covenants, conditions, warranties, and agreements herein contained as assumed by the Supply System, lessee, does hereby demise and lease to the Supply System property of the Government situated in the County of Benton, State of Washington, and within the federally owned area known as the Hanford Operations Area, United States Atomic Energy Commission, all as more particularly described in Article 2 hereof. 2. Description of Leasehold and Related Facilities
(a) A tract of land commencing at the Southeast corner of Section 28, Township, 14 North, Range 26 East Willamette Meridian (said point being located by reference to the Washington Coordinate System, South zone, at coordinates North 486,994.01 and East 2,236,672.11);
Thence North 43°45'26" West 3,205.24 feet to a point, which point is hereinafter referred to as point “A” (said point being located by reference to the Washington Coordinate System, South zone, at coordinates North 489,309.08 and East 2,234,455.35);
Thence North 67°11'41" West 700.00 feet to a point (said point being located by reference to the Washington Coordinate System, South zone, at coordinates North 489,580.40 and East 2,233,810.17);
Thence continuing North 67°11'41'' West 950 feet more or less to a point on the line of ordinary high water on the right bank of the Columbia River, which point is the True Point of Beginning;
Thence South 67°11'41" East 1,650 feet more or less to point "A" referred to above;
Thence North 22°48'19'' East 2,231.00 feet to a point (said point being located by reference to the Washington Coordinate System, South zone, at coordinates North 491,365.68 and East 2,235,320.09);
Thence North 67°11'41" West 1,200 feet more or less to the line of ordinary high water on the right bank of the Columbia River;
Thence Southwesterly along the said line of ordinary high water to the Point of Beginning, containing 73 acres more or less.
Also the shore lands of the Columbia River abutting on the abovedescribed property.
(b) Situate on the above-described realty are the items of property set forth in the inventory attached hereto as Exhibit , all of which items are included within this lease without regard to their classification either as fixtures or as severable personal property. 3. Term of Lease
This lease shall be effective commencing at midnight on the date of its execution and shall continue in effect so long as the Operating and Construction Contract is in effect between the parties hereto. 4. Payment of Rent
The Supply System shall pay to the Commission as rent for the property, both real and personal leased hereunder, and for the easements, licenses, privileges, and rights obtained under this instrument, the sum of $1,000.00 for the first annual period and the sum of $10.00 for each succeeding annual period during the term hereof, all such payments to be made in advance, in lawful money of the United States, payable at the offices of the Commission in Richland, Washington, without notice or demand therefor from the Commission. 5. Warranty of Quiet Enjoyment
The Commission agrees that, conditioned upon the Supply System's performing the agreements herein contained on its part, it shall, and may at all times during the term hereby granted, peacefully and quietly have, hold and enjoy the premises, without any manner of let, suit, trouble or hindrance of or from all persons claiming, or to claim by, through or under the Government. 6. Termination of Lease
(a) This Lease is made subject to the condition that if there should occur any of the events hereinafter provided in this paragraph, the Commission may terminate this Lease under the conditions and in the manner hereafter stated and sue for and recover all rents and damages accruing hereunder, or may sue and recover without terminating the Lease; Provided that, upon any such termination, the term hereof shall expire and thereupon, or at any time thereafter, the Commission may re-enter and take possession of the premises without compensation to the Supply System on account of such termination.
(i) In the event the Supply System uses the leased land and facilities in a manner not in compliance with the covenants and purposes provided herein or discontinues its use for such purposes and such misuse or disuse continues for sixty (60) days after written notice thereof has been given by the Commission to the Supply System, the Commission may, upon the expiration of said sixty (60) days or at any time thereafter, by giving the Supply System fifteen (15) days written notice, terminate this Lease, and this Lease shall expire upon the date specified in such notice.
(ii) In the event the Supply System shall become insolvent, make an assignment for the benefit of creditors, file a petition in bankruptcy, seek the benefit of any bankruptcy, composition or insolvency law, or be adjudged bankrupt, or if a receiver or trustee of the property of the Supply System shall be appointed, the Commission may immediately or at any time thereafter, by written notice to the Supply System, terminate this Lease and this Lease shall expire upon the date specified in such notice; Provided that, if such default be cured by the Supply System prior to the termination date specified in such notice, this Lease shall remain in full force and effect if the provisions of the pre
ceding subparagraph (i) do not apply. (b) The Supply System shall, on or before the effective date of termination or expiration of this Lease, regardless of the method or cause thereof, quietly and peaceably vacate and remove from the premises all personal property, goods and effects of the Supply System, not affixed to the land and not used primarily in the operation of the NPR, and return possession of the premises to the Government; Provided that, in the event the Supply System fails to so remove said residual property, such property shall become the property of the Government without liability of any kind. In addition, the Supply System shall bear the cost of restoration of the premises to the same extent as is required in the case of suspension under Article 7 hereof. 7. Suspension of Lease
The Commission reserves the right, at any time, with or without prior notice, to suspend this Lease as provided in the Operating and Construction Contract in order to restore the NPR to Dual Purpose Operation at the cost of the Supply System without, however, terminating the future effectiveness of the Lease should such Dual Purpose Operation be again suspended. 8. Purpose and Scope of Lease
The Supply System covenants with the Commission that the leased premises shall be occupied and used solely for the production of steam energy to operate an electric power generating plant, pursuant to and in accordance with the Operating and Construction Contract, which contract is incorporated herein by reference and made a part hereof. The Supply System covenants that it will comply with the provisions
of the Operating and Construction Contract pertaining to its use, maintenance and operation of the NPR. 9. Prohibition Against Assignment
(a) The Supply System its successors and assigns shall have no right, authority or power without the written consent of the Commission: (i) to transfer this Lease, any interest herein, or any right hereunder, by way of assignment, sublease or permission to any other person to occupy space in or make any continuing use of any part of the premises, or (ii) to do or permit any act, by way of pledge, hypothecation or sufferance of lien, voluntarily or by operation of law, which would in any way encumber any title or interest of the Government in and to said premises or any part thereof.
(b) In the event the Supply System sublets, assigns, or takes or permits any action referred to in paragraph (a) above, with respect to any part of the premises whether with or without the Commission's written consent, the Supply System shall remain responsible to the Commission for such part of the premises, the use thereof, and all other obligations hereunder, as if such subletting or other action had not been taken or permitted, unless specifically relieved of such responsibility in writing by the Commission. 10. Definitions
As used in this contract:
(a) The term "Contracting Officer” means the person executing this contract on behalf of the Government and includes his successors or any duly authorized representative of any such person.
(b) The term “Commission" means the United States Atomic Energy Commission or any duly authorized representative or successor thereof, including the Contracting Officer except for the purpose of deciding an appeal under the article entitled "Disputes”. 11. Disputes
(a) Except as otherwise provided in this contract, any dispute concerning a question of fact arising under this contract which is not disposed of by agreement shall be decided by the Contracting Officer, who shall reduce his decision to writing and mail or otherwise furnish a copy thereof to the Supply System. The decision of the Contracting Officer shall be final and conclusive unless within 30 days from the date of receipt of such copy, the Supply System mails or otherwise furnishes to the Contracting Officer a written appeal addressed to the Commission. The decision of the Commission or its duly authorized representative for the determination of such appeals shall be final and conclusive unless determined by a court of competent jurisdiction to have been fraudulent, or capricious, or arbitrary, or so grossly erroneous as necessarily to imply bad faith, or not supported by substantial evidence. In connection with any appeal proceeding under this article, the Supply System shall be afforded an opportunity to be heard and to offer evidence in support of its appeal. Pending final decision of a dispute hereunder, the Contracting Officer's decision shall be controlling.
(b) This "Disputes" article does not preclude consideration of law questions in connection with decisions provided for in paragraph (a) above; provided, that nothing in this contract shall be construed as making final the decision of any administrative official, representative, or board on a question of law.
12. Nondiscrimination in Employment
In connection with its activities under this contract, the Supply System agrees as follows:
(a) The Supply System will not discriminate against any employee or applicant for employment because of race, creed, color, or national origin. The Supply System will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, creed, color, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Supply System agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by the Contracting Officer setting forth the provisions of this Nondiscrimination article.
(b) The Supply System will, in all solicitations or advertisements for employees placed by or on behalf of the Supply System, state that all qualified applicants will receive consideration for employment without regard to race, creed, color or national origin.
(c) The Supply System will send to each labor union or representative of workers with which it has a collective bargaining agreement or other contract or understanding, a notice, to be provided by the Contracting Officer advising the said labor union or workers' representative of the Supply System's commitments under this Nondiscrimination clause, and shall post copies of the notice in conspicuous places available to employees and applicants for employment.
(d) The Supply System will comply with all provisions of Executive Order No. 10925 of March 6, 1961, and of the rules, regulations, and relevant orders of the President's Committee on Equal Employment Opportunity created thereby.
(e) The Supply System will furnish all information and reports required by Executive Order No. 10925 of March 6, 1961, and by the rules, regulations, and orders of the said Committee, or pursuant thereto, and will permit access to its books, records, and accounts by the Commission and the Committee for purposes of investigation to ascertain compliance with such rules, regulations and orders.
(f) In the event of the Supply System's noncompliance with the Nondiscrimination article of this contract or with any of the said rules, regulations, or orders, this contract may be cancelled in whole or in part and the Supply System may be declared ineligible for further government contracts in accordance with procedures authorized in Executive Order No. 10925 of March 6, 1961, and such other sanctions may be imposed and remedies invoked as provided in the said Executive Order or by rule, regulations, or order of the President's Committee on Equal Employment Opportunity, or as otherwise provided by law.
(g) The Supply System will include the provisions of the foregoing paragraphs (a) through (f) in every subcontract or purchase order unless exempted by rules, regulations, or orders of the President's Committee on Equal Employment Opportunity issued pursuant to section 303 of Executive Order No. 10925 of March 6, 1961, so that such provisions will be binding upon each subcontractor or vendor. The Supply System will take such action with respect to any subcontract or purchase order as the Commission may direct as a means of