20111117Notice of Affiliate Transaction.pdf

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Mark C. Moench
Senior Vice President and General Counsel
201 S. Main Street, Suite 2400
Salt Lake City, UT 84111
801-220-4459 Office
801-220-4058 Fax
mark.moench(facifcorp.com
".ROCKY MOUAIN
~~.J ZUllNOVI7 M\9:46
November 17,2011
Idaho Public Utilities Commission
472 West Washington
Boise,ID 83702-5983
Attention:Jean D. Jewell
Commission Secreta
Re:PacifiCorp Notice of Affliate Transaction
Case No. PAC-E-05-8
Dear Ms. Jewell:
This letter will serve as notice pursuant to Commitment I 17(2), incorporated in the
Idaho Public Utilties Commission Order No. 29973 issued Februar 13,2006, as supplemented
by Order No. 29998 March 14, 2006, in the above-referenced proceeding, approving the
acquisition ofPacifiCorp by MidAerican Energy Holdings Company ("MEHC"), of an affiliate
interest transaction. Rocky Mountan Power hereby submits an original and seven copies each of
the License for Electrc Supply Line Across or Along Railway Propert (License) between
PacifiCorp, and BNSF Railway Company (BNSF), Contract No. 11-3013, a copy of which is
included as Attchment A. PacifiCorp is a wholly-owned indirect subsidiar of MidAerican
Energy Holdings Company (MEHC). MEHC is a subsidiar of Berkshire Hathaway, Inc. BNSF
is also a subsidiar of Berkshire Hathaway, Inc. Therefore, Berkshire Hathaway, Inc.'s
ownership interest in MEHC and BNSF may create an affiiated interest in some PacifiCorp
jursdictions.
The License allows the Company to construct, maintain and use facilties for electric
service across and along certain BNSF property at or near BNSF's station of Parker in Yakma
County, Washington. These facilties are necessar to provide new service to a customer and
BNSF's propert must be used to provide that service. The new facilities will be constrcted
along the side of railroad tracks to connect a bilboard. The term of the license will be 25 years.
Without the License, the Company's abilty to provide adequate, safe and reliable service to its
customers would be diminished.
The Company wil pay a $2,500 fee to BNSF for the License. BNSF offers two types of
licenses for use of BNSF railroad property. The first tye allows for the crossing of BNSF
railroad tracks. BNSF charges a set fee for ths tye of license. The second type allows for the
use of BNSF property ruing alongside railroad tracks. BNSF uses a stadard formula for
calculating the fee for this tye of license. Because the License covers Company facilties that
are rung alongside BNSF railroad tracks, the formula fee applies. This is BNSF's standard
practice for developing the fee for all licenses of this tye. Additionally, the Company will pay a
tota of $600.00 as a processing fee for the License application. Additionally, the Company will
pay a fee of $400 for Railroad Protective Liability Insurance, which is required by BNSF. These
are the standard rates and fees BNSF charges for applications of this type.
Jean D. Jewell
Notice of Affiliate Transaction
November 17,2011
Page 2
Obtaining the License is in the public interest because it allows the Company to constrct
facilities necessar to provide electrc service and to meet its obligation to provide safe and
reliable electric service. The Company will be constructing new facilities to extend service to a
customer. Not having the License would require the Company to redesign or relocate its
facilities, adding considerable expense to the cost of providing electric service. As the property
owner, BNSF is the only entity that can provide this License to the Company.
Please do not hesitate to contact me if you have any questions.
Very try yours,ß(uf~.~
Mark C. Moench
Senior Vice President and
General Counsel
Rocky Mountain Power
Enclosures
Law Deparent Approved Contract No. 11-3013
BF#
LICENSE FOR ELECTRIC SUPPLY LINE
ACROSS OR ALONG RA WAY PROPERTY
(Electrc Light, Power Supply, Irespective of Voltage, Overhead or Underground)
THS LICENSE ("Licens"), made as of the _ day of November, 2011 ("Effecve
Date") by and betwee BNSF RALWAY COMPANY, a Delaware corpration ("Liceor")
and PACIFICORP, an Oregon corporation ("Licensee").
NOW THEREFORE, in considertion of the mutu covenants contained herein, the
paries agre to the following:
GENERA
1. Licensor hereby grts Licensee a non-exclusive license, subject to al rights, interests,
and esttes of thd pares including, without limitation, any leases, use rights,
eaements, liens or other encumbraces, and upon the terms and conditions set fort
below, to constrct, mata, and use in strct accordace with the drwigs and
spifications approved by Licensor as par of Licensee's application process ("the
Drawings and Specifcations") an electrc supply line contanig a maxum of 1
conductor, together with its supportng or contanig strctues ("Electrc Supply Line")
across or along the premises of Licensor at or near the sttion of Parker, County of
Yakma, State of Washington, Line Segment 0048, Mile Post 52.67, shown by bold line
upon the print No. 3-52714, dated 9/15/2011 marked "Exhibit A", atthed hereto and
made a par hereof ("Premises").
2. Licensee shall not distb any improvements of Licensor or Licensor's existing lessees,
Licensees, easement beneficiares or lien holders, if any, or interfere with the use of such
improvements.
3. Licensee shal use the Premises solely for constrction, maintenance, and use of an
Electric Supply Line in accordace with the Drawigs and Specifications. Licensee shal
not use the Premises for any other purose. Licensee shall not use or store hazous
substaces, as defied by the Comprehensive Environmenta Response, Compenstion,
and Liabilty Act, as amended ("CERCLA") or petroleum or oil as defied by applicable
Environmental Laws on the Premises.
4. In case of the eviction of Licensee by anyone ownng or claimig title to or any interest
in the Premises, Licensor shal not be liable to refud Licensee any compensation paid
hereunder or for any damage Licensee sustas in connection therewith.
5. Any contractors or subcontractors performing work on the Electrc Supply Line or
entering the Premises on behalf of Licenee, shall be deemed servants and agents of
Licensee for puroses of this License.
Form 421; Rev. 0426/05
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Law Deparent Approved Contract No. 11-3013
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TERM
6. Ths License shal commence on the Effective Date and shall continue for a perod of
twenty-five (25) year, subject to prior termination as hereinafer described.
COMPENSATION
7.(a)Licenee shal pay Licensor, prior to the Effective Date, the sum of TWO
THOUSAN FIV HUNDRED DOLLARS ($2,500.00) as compensation for
the use of the Premises.
(b) Licensee agrees to reimburse Licensor (withn thirty (30) days afr receipt of
bils therefor) for all costs and expenses incurd by Licenor in connection with
Licensee's use of the Premises or the presence, constction, maitenace, and use
of the Electrc Supply Line, including but not limted to the fushig of
Licensor's Flagan and any vehicle renta costs incured. The cost of flagger
serices provided by the Raway, when deemed necessar by the Railway's
representative, will be borne by the Licensee. The estimate cost for one (1)
flagger is $600.00 for an eight (8) hour basic day with time and one-haf or double
tie for overtime, rest days and holidays. The estimated cost for each flagger
includes vacation allowace, paid holidays, Ralway and unemployment
insance, public liabilty and property damage inurce, health and welfar
benefits, transportation, meas, lodging and supervsion. Negotiations for
Ralway labor or collectve bargainig agreements and rate chages authorized by
appropriate Federal autorities may increase actu or estimated flagging rates.
The flagging rate in effect at the tie of perormance by the Contractor hereunder
will be used to caculate the act costs of flagging pursuat to ths paragrph.
( c) All invoices ar due thir (30) days afer the date of invoice. In the event tht
Licensee shall fal to pay any monies due to Licensor withn thir (30) days afer
the invoice date, then Licenee shal pay interest on such unpaid sum from th
(30) days afer its invoice date to the date of payment by Licensee at an anua
rate equa to (i) the grter of (a) for the period Janua 1 though June 30, the
prie rate las published in The Wall Street Journal in the preceding December
plus two and one-haf percent (2 1/2%), and for the period July 1 thugh
December 31, the prime rate last published in The Wall Street Journal in the
preceding June plus two and one-hal percent (2 1/2%), or (b) twelve percent
(12%), or (ii) the maimum rate permtted by law, whichever is less.
COMPLIACE WITH LAWS
8.(a)Licensee shal observe and comply with any and all laws, statutes, reguations,
ordices, orders, covenants, restrctions, or decisions of any cour of competent
jursdiction ("Legal Requirements") relatig to the consction, matenance and
use of the Electrc Supply Line and the use of the Premises.
Form 421; Rev. 046105
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Law Deparent Approved Contract No. 11-3013
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(b) Prior to entering the Preises, Licensee shall and shal cause its contractor to
comply with al Liceor's applicale saety rules and reguations. Prior to
commencing any work on the Premises, Licensee shal complete and shall require
its contrctor to complete the safety-traing program at the following Internet
Website ''htt://contractororientation.com''.This trnig mus be completed no
more th one year in advance of Licensee's entr on the Premises.
DEFINITION OF COST AN EXPENSE
9. For the purse of ths License, "cost' or "costs" "expense" or "expenses" includes, but is
not limted to, actual labor and material costs including all assignable additives, and
material and supply costs at curent value where used.
RIGHT OF LICENSOR TO USE
10. Licensor excepts and reserves the right, to be exercised by Licensor and any other pares
who may obtain wrtten permssion or autority from Licensor:
(a) to maita, renew, use, operate, chage, modify and relocate any existing pipe,
power, communcation lines and appurnaces and other facilties or stctues
of like chaacter upon, over, under or across the Premises;
(b) to constrct, maintan, renew, use, operate, change, modify and relocate any
tracks or additiona facilties or strctues upon, over, under or across the
Premises; or
(c) to use the Premises in any maner as the Licensor in its sole discretion deems
appropriate, prvided Licensor uses all commercially reasonable efforts to avoid
material interference with the use of the Premises by Licensee for the purose
specified in Section 3 above.
LICENSEE'S OPERATIONS
11.(a)Licensee shal notify Licensor's Roadaster, Andy Vulgas at 602 West 3rd Street,
Ellenburg, WA 98926, telephone [phone], at least five (5) business days
prior to constrction of the Electric Supply Line and prior to enterig the
Premises for any subsequent maintenace thereon.
(b) In performg the work descrbed in Section 3, Licensee shall use only public
roadways to cross from one side of Licensor's tracks to the other.
12.(a)Licensee shal, at its sole cost and expse, constrct and at all times maita the
Electrc Supply Line in accordace with the National Electrc Code.
(b) If the operation or maintenace of sad Electrc Supply Line shall at any time
cause interference, includig but not limted to physica interference from
Form 421; Re. 046105
3
Law Deparent Approved
13.
Contract No. 11-3013
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electromagnetic induction, electrostatic induction, or from stay or other curents,
with the facilties of the Licensor or of any lessee or Licensee of the Licensor, or
in any maer interfere with the operation, maintenance, or us by the Licensor of
its right-of-way, tracks, strctues, pole lines, sign and communication lines~
raio, or other equipment, devices, other propert or appurenaces thereto,
Licensee agrees imediately to make such changes in its Electic Supply Line
and fush such protective devices and/or replacement equipment to Licensor and
its lesses or Licensees as shal be necessar, in the judgement of the Licensor's
representative, to eliminte such intererence. The cost of such protective devices
and their inlations shall be borne solely by Licensee. If any of the interference
covered by ths paragraph shal be, in the judgement of the Licensor, of such
importance to the safety of the Licensor's operations as to require immediate
corrective action, Licensee, upon notice frm the Licensor, shall either, at the
Licensr's election, cease using sad Electc Supply Line for any purse
whatsoever and remove same, or reduce the voltae or load on said Electrc
Supply Line, or tae such other interi protective measures as the Licensor may
deem advisable, until the protectve devices and/or replacement equipment
requied by ths paragraph have been instaled, put in operation, tested, and found
to be satisfatory to correct the interference.
(a)Under no conditions shal Licensee be permitted to conduct any tests,
investigations or any other activity using mechaze equipment and/or
machiery, or place or store any mechan equipment, tools or other matenals,
withn twnty-five (25) feet of the centerline of any ralrad track on the Premises
uness Licensee ha obtaed prior wrtten approval frm Licensor. Licensee
sha, at its sole cost and expense, perform all activities on and about the Premises
in such a maner as not at any tie to be a soure of dager to or interference
with the existence or use of present or future tracks, roadbed or propert of
Licensor, or the safe operation and activities of Licensor. If ordered to cease
using the Premises at any tie by Licensor's personnel due to any hadous
condition, Licensee sha immedately do so. Notwthstadig the foregoin right
of Licensor, the paries agree that Licensor has no duty or obligation to monitor
Licensee's use of the Premises to determine the safe nature thereof, it being solely
Licensee's responsibilty to ense that Licensee's use of the Premises is safe.
Neither the exercise nor the failure by Licensor to exercise any rights granted in
ths Section will alter the liabilty allocation provided by ths License.
(b) Licensee shall, at its sole cost and expense, and subject to the supervision of
Licensor's Roadmaster, locate, constrct and maitan the Electrc Supply Line in
such a maner and of such material tht it wil not at any tie be a source of
danger to or interference with the existence or use of present or futue tracks,
roadbed or propert of Licensor, or the safe operation and activities of its railroad.
Furer, the Electc Supply Line shall be constrcted, intaed and mataned in
conformty with the plans and specifications shown on the print attched hereto as
Exhbit A and made a par hereof (which, if present, are to be deemed par of the
Drawigs and Specifications). Licensor may diect one of its field engineer to
Form 421; Rev. 0416/05
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Law Deparent Approved Contrt No. 11-3013
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observe or inpect the constction and/or maintenace of the Electrc Supply
Line at any tie for compliance with the Drawings and Specifications. If ordered
at any tie to hat constrction or maitenance of the Electric Supply Line by
Licensor's personnel due to non-compliance with the same or any other hadous
condition, Licensee shall immediately do so. Notwthstadig the foregoing right
of Licensor, the pares agre tht Licensor has no duty or obligation to observe or
inpect, or to hat work on, the Electrc Supply Line, it being solely Licensee's
responsibilty to ensure tht the Electric Supply Line is constrcted in strct
accordance with the Drawigs and Specifications and in a sae and workmike
maner in compliance with all ters hereof. Neither the exercise nor the faiur
by Licensor to exercise any right granted by ths Section will alter in any way the
liabilty allocation provided by this License. If at any time Licene shall, in the
sole judgment of Licensor, fail to properly perform its obligations under this
Section, Licensor may, at its option and at Licensee's sole expense, arange for
the perormance of such work as it deems necessar for the safety of its
operations and activities. Licensee shal promptly reimburse Licensor for all costs
and expenses of such work, upon receipt of an invoice for the same. Licesor's
failure to perform any obligations of Licensee shall not alter the liabilty
allocation hereunder.
14. Licensee shall, at its sole cost and expense, reove all combustible material from around
wooden poles and will at all times keep the space around such poles free of such material,
and if removal of such combustble material shall not be attnded to with fifteen (15)
days afer having been requested by Licenor to do so, Licensor shal have the right itself
to perorm the work and Licensee hereby agrees to reimbure Licensor for the expense so
incured.
15. Dung the constrction and any subsequent maitenance performed on Electrc Supply
Line, Licensee shal perform such work in a maner to preclude daage to the propert
of Licensor, and preclude interference with the opertion of its railroad. The constction
of the Electrc Supply Line shl be completed withn one (1) yea of the Effective Date.
Upon completion of the constrction of the Electrc Supply Line and afer performing
any subsequent maitenace thereon, Licensee shall, at Licensee's own cost and expense,
restore Licensor's premises to their former stte as of the Effective Date of ths License.
16. If at any tie durg the term of ths License, Licensor shall desire the use of its rail
corrdor in such a maner as would, in Licensor's reasonable opinion, be interfered with
by the Electrc Supply Line, Licensee shal, at its sole expense, withn thrt (30) days
afer receiving wrtten notice from Licensor to such effect, make such changes in the
Electrc Supply Line as in the sole discretion of Licensor may be necessar to avoid
inteerence with the proposed use of Licensor's rail corrdor, including, without
limtation, the relocation of the existing or the constrction of new a Electrc Supply
Line.
17.(a)Prior to Licensee conducting any borig work on or about any porton of the
Premises, Licensee sha explore the proposed location for such work with hand
Form 421; Rev. 0412/05
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Law Deparent Approved Contract No. 11-3013
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tools to a dept of at leat th (3) feet below the surace of the ground to
determine whether pipelines or other strctues exist below the surace, provided,
however, that in lieu of the foregoing, the Licensee shal have the right to use
suitable detection equipment or other generally accepted industr practice ~,
consultig with the Underground Serces Association) to deterine the existence
or location of pipelines and other subsurace stctues prior to drlling or
excavatig with mechanzed equipment. Upon Licensee's wrtten request, which
shall be made thrt (30) business days in advance of Licensee's reuested
consction of the Electrc Supply Line, Licensor will provide Licenee any
inormation that Licensor's Engineerig Deparent has in its possession
concerng the existence and approximate location of Licensor's underground
utilities and pipelines at or nea the vicinity of the proposed Electric Supply Line.
Prior to conducting any such boring work, the Licensee wil review all such
material. Licensor does not wat the accuracy of inormation relating to
subsurace conditions and Licensee's operations wil be subject at all ties to the
liabilty provisions herein.
(b) For all bores greater th 26-inch diameter and at a depth less th 10.0 feet
below bottom of rail, a soil investigation will need to be peormed by the
Licensee and reviewed by Licensor prior to constrction. Ths study is to
determine if grular material is present, and to prevent subsidence durg the
instalation process. If the investgation determines in Licensor's reasonable
opinion that granular material is present, Licensor may select a new loction for
Licensee's use, or may requie Licensee to fush for Licensor's review and
approval, in its sole discretion a remedal plan to dea with the granular material.
Once Licensor has approved any such remedial plan in wrtig, Licensee shal, at
its sole cost and expense, car out the apprved plan in accordace with all terms
thereof and hereof.
18. Any open hole, borig or well consct on the Premises by Licensee shal be safely
covered and secured at all times when Licensee is not working in the actu vicinity
thereof. Followig completion of that porton of the work, all holes or borings
constrcted on the Premises by Licensee shall be:
(a) filled in to suroundig ground level with compacted bentonite grout; or
(b) otherwse secured or retire in accordance with any applicable Legal
Requiement. All excavated materials shall not rema on Licensor's propert for
more than ten (10) days and shall be properly disposed of by Licensee in
accordance with applicable Legal Requirements.
19. Upon termintion of ths License, Licensee shal, at its sole cost and expense:
(a) remove all of its equipment from the Premises;
(b) remove the Electrc Supply Line at Licensor's sole discretion;
Form 421; Rev. 0416/05
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Law Deparent Approved Contract No. 11-3013
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( c) report and restore any damage to the Premises arsing from, growig out of, or
connected with Licensee's use of the Premises;
(d) remedy any unfe conditions on the Prmises created or aggravated by Licenee;
and
( e) leave the Premses in the condition which existed as of the Effective Date of thsLicen.
20. Licensee's on-site supervsion shal retamaitain a fuly-executed copy of ths License
at all ties while on the Premises.
LIABILITY
21. (a) TO THE FULLEST EXTENT PERMTTED BY LAW, LICENSEE SHALL
RELEASE, INDEMN, DEFEND AN HOLD HARMESS LICENSOR
AND LICENSOR'S AFLIATED COMPANES, PARTNERS,
SUCCESSORS, ASSIGNS, LEGAL REPRESENTATIVES, OFFICERS,
DIRECTORS, SHAHOLDERS, EMPLOYEES AN AGENTS
(COLLECTIVLY, "INDEMNITEES") FOR, FROM AND AGAINST
AN AND ALL CLAIMS, LIABILITIES, FINS, PENALTIES, COSTS,
DAMGES, LOSSES, LIENS, CAUSES OF ACTION, SUITS, DEMAS,
JUDGMENTS AN EXPENSES (ICLUDING, WIHOUT LIMATION,
COURT COSTS, ATTORNYS' FEES AND COSTS OF
INSTIGATION, REMOVAL AN REMEDIATION AND
GOVERNENTAL OVERSIGHT COSTS) ENVRONMNTAL OR
OTHERWISE (COLLECTIVELY "LIAILITIES") OF AN NATUR,
KI OR DESCRPTION OF ANY PERSON OR ENTTY DIRECTLY
OR INIRECTLY ARSING OUT OF, RESULTING FROM OR
RELATED TO (I WHOLE OR IN PART):
(i) TilS LICENSE, INCLUDING, WITHOUT LIMITATION, ITS
ENVRONMNTAL PROVISIONS,
(ü) AN RIGHTS OR INTERESTS GRATED PURUAN TO
THIS LICENSE,
(üi) LICENSEE'S OCCUPATION AND USE OF THE
PREMISES,
(iv) THE ENVIRONMENTAL CONDITION AN STATUS OFTH PREMISES CAUSED BY OR CONTUTED BY
LICENSEE, OR
Form 421; Rev. 04/261
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Law Deparent Approved Contrct No. 11-3013
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(v) AN ACT OR OMISSION OF LICENSEE OR LICENSEE'S
OFFICERS, AGENTS, INEES, EMPLOYEES, OR
CONTCTORS, OR ANONE DIRECTLY OR INDIRCTLY
EMPLOYED BY ANY OF THEM, OR ANONE THY CONTROL
OR EXERCISE CONTROL OVER,
EVEN IF SUCH LIABILITIES ARSE FROM OR AR ATTRIBUTED
TO, IN WHOLE OR IN PART, AN NEGLIGENCE OF AN
INEMNITEE. TH ONLY LIABILITIES WIH RESPECT TO WHCH
LICENSEE'S OBLIGATION TO INDEMNIFY TH INEMNITEES
DOES NOT APPLY ARE LIABILITIES TO TH EXTENT
PROXIMATELY CAUSED BY THE GROSS NEGLIGENCE OR
WILFU MISCONDUCT OF AN INEMNTEE.
(b) FURTHER, TO THE FULEST EXTENT PERMTED BY LAW,NOTWIHSTANING TH LIMITATION IN SECTION 21(a),
LICENSEE SHALL NOW AND FOREVER WAI AN AND ALL
CLAIMS, REGARLESS WHTHER BASED ON THE STRICT
LIABILITY, NEGLIGENCE OR OTHERWISE, THAT RALROAD IS AN
"OWNER", "OPERATOR", "ARNGER", OR "TRSPORTER"
WIH RESPECT TO THE ELECTRIC SUPPLY LINE FOR THE
PUROSES OF CERCLA OR OTHER ENVRONMNTAL LAWS.
LICENSEE WIL INEMNIFY, DEFEND AND HOLD THE
INDEMNITEES HALESS FROM ANY AN ALL SUCH CLAIS
REGARLESS OF THE NEGLIGENCE OF THE INDEMNITEES.
LICENSEE FURTHER AGREES THT THE USE OF THE PREMISES
AS CONTEMPLATED BY TmS LICENSE SHALL NOT IN AN WAY
SUBJECT LICENSOR TO CLAIMS THAT LICENSOR IS OTHER TH
A COMMON CARR FOR PUROSES OF ENVIRONMENTAL LAWS
AN EXPRESSLY AGREES TO INDEMNIFY, DEFEND, AN HOLD
THE INDEMNTEES HAESS FOR AN AN ALL SUCH CLAIS.
IN NO EVENT SHAL LICENSOR BE RESPONSmLE FOR THE
ENVIRONMENTAL CONDITION OF THE PREMISES.
(c) TO THE FULLEST EXTENT PERMITTED BY LAW, LICENSEE
FURTHER AGREES, REGARLESS OF ANY NEGLIGENCE OR
ALLEGED NEGLIGENCE OF ANY INEMNE, TO INEMNY,
AND HOLD HALESS THE INEMNTEES AGAIST AN ASSUME
THE DEFENSE OF ANY LIABILITIES ASSERTED AGAIST OR
SUFFERED BY ANY INDEMNITEE UNDER OR RELATED TO THE
FEDERA EMPLOYERS' LIABILITY ACT ("FELA") WHENEVER
EMPLOYEES OF LICENSEE OR AN OF ITS AGENTS, INVITEES, OR
CONTRACTORS CLAM OR ALLEGE THAT THEY AR EMPLOYEES
OF AN INDEMNITEE OR OTHERWISE. THIS INDEMNITY SHALL
ALSO EXTEND, ON TH SAM BASIS, TO FELA CLAIMS BASED ON
ACTUAL OR ALLEGED VIOLATIONS OF AN FEDERAL, STATE OR
Form 421; Rev. 04126105
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Law Deparent Approved Contract No. 11-3013
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LOCAL LAWS OR REGULATIONS, INCLUDING BUT NOT LIMITED
TO THE SAFTY APPLIANCE ACT, THE BOILER INSPECTION ACT,
THE OCCUPATIONAL HEALm AN SAFETY ACT, THE RESOURCE
CONSERVATION AN RECOVERY ACT, AND AN SIMIAR STATE
OR FEDERA STATUTE.
(d) Upon wrtten notice frm Licensor, Licensee agrees to assume the defense of any
lawsuit or other proceeding brought agait any Indemnitee by any entity, relatig
to any matter coverd by ths License for which Licensee ha an obligation to
assume liabilty for and/or save and hold haress any Indemnitee. Licenee shall
pay all costs incident to such defense, including, but not limited to, attorneys' fees,
investgators' fees, litigation and appeal expenes, settlement payments, and
amounts paid in satisfaction of judgments.
PERSONAL PROPERTY WAIER
22. ALL PERSONAL PROPERTY OF LICENSEE, INCLUDING, BUT NOT
LIMITED TO, FIXTURES, EQUIPMENT, OR RELATED MATERIS UPON
THE PREMISES WIL BE AT THE RISK OF LICENSEE ONLY, AN NO
INDEMNITEE WIL BE LIALE FOR AN DAMGE THERETO OR THFT
THEREOF, WHTHER OR NOT DUE IN WHOLE OR IN PART TO THE
NEGLIGENCE OF ANY INDEMNTEE.
INSURACE
23. Licensee shal, at its sole cost and expense, procur and mantan durng the life of this
Agrement the followig inurce coverage:
A. Commercial Genera Liabilty Insurance. This insurce shal conta broad form
contractu liabilty with a combined single limit of a minimum of $2,000,000
each occurence and an aggregate limit of at least $ 4,000,000. Coverage must be
purchaed on a post 1998 iso occurnce or equivalent and include coverage for,
but not limited to, the followig:
. Bodily Injur and Propert Damage
. Persona Injur and Advertsin Injur
. Fire legal liabilty
. Products and completed operations
Ths policy shal also conta the followig endorsements, which shal be indicated on the
cercate of insurance:
. It is agreed tht any workers' compensation exclusion does not apply to
Licensor's payments related to the Federal Employers Liabilty Act or a
Licensor Wage Continuation Program or similar progrs and any payments
made are deemed not to be either payments made or obligations assumed
under any Workers Compensation, disabilty benefits, or unemployment
compesation law or simiar law.
Form 421; Rev. 046105
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Law Deparent Approved Contrct No.1 1-3013
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. The definition of insured contrct shall be amended to remove any exclusion
or other limitation for any work being done with 50 feet of railroad propert.
. Any exclusions related to the explosion, collapse and underground haz
shal be removed. No other endorsements limiting coverage may be included
on the policy.
B. Business Automobile Insurce. Ths inurce shall conta a combined single
limit of at leas $1,000,000 per occurence, and include coverage for, but not
limted to the following:
. Bodily injur and proper damage
. Any and all vehicles owned used or hied
C. Workers Compensation and Employers Liabilty Inurance. Ths insurce shall
include coverage for, but not limte to:
. License's sttutory liabilty under the worker's compenstion laws of the
stte( s) in which the work is to be performed. If optiona under State law, the
insuance must cover all employees anyway.
. Employers' Liabilty (par B) with limits of at leat $500,000 each accident,
$500,000 by disease policy limit, $500,000 by diseas each employee.
D. Ralroad Protective Liabilty Insurance. Ths inurance shal nae only the
Licensor as the Insured with coverage of at least $2,000,000 per occurnce and
$6,000,000 in the aggregate. The coverage obtained under ths policy shall only
be effective durng the intial intaation and/or constrction of the Electic
Supply Line. THE CONSTRUCTION OF THE ELECTRC SUPPLY LINE
SHALL BE COMPLETED WITH ONE (1) YEAR OF THE EFFCTIV
DATE. If fuer maitenance of the Electric Supply Line is needed at a later
date, an additiona Ralroad Protective Liabilty Insurance Policy shall be
required. The policy shall be issued on a stdad ISO form CG 0035 1093 and
include the following:
. Endorsed to include the Pollution Exclusion Amendment (ISO form CG 28 31
1093)
. Endorsed to include the Limited Seepage and Pollution Endorsement.
. Endorsed to include Evacuation Expense Coverge Endorsement.
. No other endorsements restcting coverage may be added.
. The original policy must be provided to the Licensor prior to performng any
work or services under ths Agreement
In lieu of providing a Ralroad Protective Liabilty Policy, Licensee may parcipate in
Licensor's Blanet Raioad Protective Liabilty Insurce Policy available to Licensee or
its contractor. The limits of coverae ar the same as above. The cost is $
a I elect to paricipate in Licensor's Blanet Policy;
a I elect not to parcipate in Licensor's Blanet Policy.
Form 421; Rev. 04/26105
10
Law Deparent Approved Contrct No. 11-3013
BF#
Other Requiments:
Where allowable by law, all policies (applyin to coverage listed above) shall contan no
exclusion for puntive daages and certficates of insurce shall reflec that no
exclusion exists.
Licensee agres to waive its right of recovery agait Licenor for all clai and suits
against Licensor. In addition, its inurers, though policy endorsement, waive their right
of subrogation agait Licensor for all clais and suits. The cerifcate of insurce mus
reflect waiver of subrogation endorsement. Licensee fuer waives its right of reovery,
and its inurrs also wave their right of subrogation agaist Licensor for loss of its
owned or leased propert or property under its care, custody or control.
Licensee's insurance policies thugh policy endorsement must include wording which
states that the policy shall be prima and non-contrbuting with respect to any insurance
caied by Licensor. The certficate of insurance must reflect that the above wordig is
included in evidenced policies.
All. policy(ies) reuied above (excludi Workers Compensation and if applicable,
Ralroad Protetive) shall include a severabilty of interest endorsement and shal nae
Licensor and Iron Horse Development, LLC as an additiona insured with respect to work
performed under this agreement. Severabilty of interest and naing Licensor and Iron
Horse Development, LLC as additiona insureds sha be indicated on the certficate of
inurance.
Licensee is not allowed to self-inur without the prior wrtten consent of Licensor. If
granted by Licensor, any deductible, self-insured retention or other fiancial
responsibilty for clai shal be covered diectly by Licensee in lieu of insurance. Any
and all Licensor liabilties that would otherwse, in accordance with the provisions of ths
Agreement, be covered by Licensee's insurance will be covered as if Licensee elected not
to include a deductible, self-insurd retention, or other finacial responsibilty for claims.
Prior to commencing the Work, Licensee shall fuish to Licensor an acceptable
certficate(s) of inurce including an origin signatue of the authorized representative
evidencing the requied coverge, endorsements, and amendments and referencing the
contrct audit/folder number if available. The policy(ies) shal conta a provision tht
obligates the insurance company(ies) issuig such policy(ies) to notify Licensor in
wrting at least 30 days prior to any cancellation, non-renewal, substitution or materal
alteration. Ths cancellation provision shall be indicated on the certificate of insurance.
Upon request from Licensor, a certfied duplicate origina of any requied policy shl be
fushed.
Any insurance policy shall be written by a reputable insurance compay aceptable to
Licensr or with a curent Best's Gude Ratig of A- and Class VII or better, and
authorizd to do business in the state(s) in which the service is to be provided.
Form 421; Rev. 046/05
11
Law Deparent Approved Contrct No. 11-3013
BF#
Licensee WARTS that ths License has been thoroughly reviewed by Licenee's
insurce agent(s)/broker(s), who have been intrcted by Licensee to procure the
insurance coverage reui by this Agreeent. Allocated Loss Expense shal be in
addition to all policy limits for coverages referenced above.
Not more frequently th once ever five yeas, Licensor may reasonably modfy the
requir insurance coverage to reflect then-curent risk management practices in the
railroad indust and underwting practices in the inurce industr.
If any porton of the opertion is to be subcontracted by Licensee, Licensee shall requi
that the subcontractor shal provide and maita insurce coverages as set fort herein
namg Licensor as an additional inured and shall require tht the subcontractor shall
releae, defend and indemnfy Licesor to the same extnt and under the same terms and
conditions as Licensee is required to release, defend and indemnfy Licensor herein.
Failure to provide evidence as requied by ths section shall entitle, but not require,
Licenor to terminate ths License immediately. Acceptace of a cerficate that does not
comply with ths section shall not operate as a waver of Licensee's obligations
hereunder.
The fact tht insurance (including, without limitation, self-insurance) is obtaned by
Licensee shall not be deemed to release or diinsh the liabilty of Licensee including,
without limitation, liabilty under the indemnty provisions of ths License. Damges
recoverable by Licensor shal not be limited by the amount of the required insurce
coverage.
For puroses of ths section, Licenor shall mean "Burlington Norter Santa Fe
Corporation", "BNSF Ralway Company" and the subsidiares, successors, assigns and
afliates of each.
ENVONMENTAL
24.(a)Licensee shall strctly comply with all federal, stte and local environmental laws
and regulations in its use of the Premises, including, but not limited to, the
Resoure Conservation and Recovery Act, as amended (RCRA), the Clea Water
Act, the Oil Pollution Act, the Hazdous Materials Tranporttion Act, CERCLA
(collectively referred to as the "Envionmenta Laws"). Licensee shall not
maita a tratment, storage, transfer or disposal facilty, or underground storage
ta as defied by Environmenta Laws on the Premises. Licensee shall not
release or sufer the releae of oil or hadous substaces, as defined by
Envionmental Laws on or about the Premises.
(b) Licensee shal give Licensor immediate notice to Licensor's Resoure Operations
Center at [phone] of any release of hazardous substaces on or from the
Premises, violation of Environmenta Laws, or inection or inqui by
governental authorities chaged with enforcing Envionmenta Laws with
respect to Licensee's use of the Premises. License shal use the best efforts to
Form 421; Rev. 04615
12
Law Deparent Approved Contrct No. 11-3013
BF#
promptly respond to any releae on or from the Premises. Licensee also shal give
Licensor imediate notice of all measurs undertaken on behalf of Licensee to
investigate, remedate, respond to or otherwse cure such releae or violation.
(c) In the event that Licenor ha notice frm Licensee or otherwse of a releas or
violaton of Envionmenta Laws arsing in any way with respect to the Electric
supply Line which occured or may occur durg the term of this License,
Licensr may reuire Licenee, at Licensee's sole risk and expense, to tae tiely
meaures to investigate, remediate, respond to or otherwse cure such releae or
violation afecting the Premises or Licensor's right-of-way.
(d) Licensee shal promptly reort to Licensor in wrting any conditions or activities
upon the Premises known to Licesee which create a risk of har to persons,
propert or the environment and shall tae whatever action is necessar to prevent
injur to persons or propert arising out of such conditions or activities; provided,
however, tht Licensee's reportg to Licensor shall not relieve Licensee of any
obligation whatsoever imposed on it by ths License. Licensee shall promptly
respond to Licensor's reuest for inormation regarding said conditions or
activities.
ALTERATIONS
25. Licensee may not make any alterations to the Premises or permanently afx anytng to
the Premises or any buildigs or other strcturs adjacent to the Premises without
Licensor's prior wrtten consent.
NO WARRIES
26. LICENSOR'S DUTIES AN WARTIES ARE LIMID TO THOSE
EXPRESSLY STATED IN Tms LICENSE AND SHAL NOT INCLUDE AN
IMLIED DUTIES OR IMPLIED WARNTIES, NOW OR IN TH FUTU.
NO REPRESENTATIONS OR WARNTIES HAVE BEEN MADE BY
LICENSOR OTHER THA THOSE CONTAINED IN Tms LICENSE.
LICENSEE HEREBY WAIS AN AND ALL WARRIES, EXPRES OR
IMLIED, WI RESPECT TO THE PREMISES WHICH MAY EXIST BY
OPERATION OF LAW OR IN EQUITY, INCLUDING, WIOUT
LIMTATION, ANY WARTY OF MERCHANTABILITY, HAITABILIT
OR FITNESS FOR A PARTICULAR PURPOSE.
QUIT ENJOYMENT
27. LICENSOR DOES NOT WAR ITS TITLE TO TH PROPERTY NOR
UNDERTAK TO DEFEND LICENSEE IN THE PEACEABLE POSSESSION
OR USE THREOF. NO COVENANT OF QUIT ENJOYMENT is MAE.
Form 421; Rev. 04126105
13
Law Deparent Approved Contrct No. 11-3013
BF#
DEFAULT
28. If default shall be made in any of the covents or agreements of Licensee contained in
ths docuent, or in cae of any assignment or tranfer of ths License by operation of
law, Licensor may, at its option, terminte ths License by servg five (5) days' notice in
wrtig upon License. Any waiver by Licensor of any default or defaults shall not
constitute a waiver of the right to termte this License for any subsequent default or
defaults, nor shall any such waiver in any way afect Licensor's abilty to enforce any
Section of ths License. The remedy set fort in this Section 28 shall be in addition to,
and not in limtaon of, any other remedes tht Licensor may have at law or in equity.
LIENS AND CHARGES
29. Licensee shall promptly pay and dischage any and all liens arsing out of any
constction, alterations or repairs done, sufered or peritted to be done by Licensee on
Premises. Licensor is hereby authorized to post any notices or take any other action upon
or with respect to Premises tht is or may be permtted by law to prevent the attchment
of any such liens to Premises; provided, however, tht failur of Licensor to tae any
such action shall not relieve Licensee of any obligation or liabilty under ths Section 29
or any other Section of this License. Licensee shall pay when due any taes, assessments
or other chages (collectively, "Taxes") levied or assessed upon the Improvements by any
governenta or quai-governenta body or any Taxes levied or assessed against
Licensor or the Premses that are attbutable to the Improvements.
TERMNATION
30. Ths License may be termted by Licensor, at any time, by servg th (30) days'
wrtten notice of termtion upon Licensee. This License may be termnated by
Licensee upon execution of Licensor's Mutu Termintion Letter Agreement then in
effect. Upon expiration of the time specified in such notice, ths License and all rights of
Licensee shall absolutely cee.
31. If Licensee fails to surender to Licensor the Premses, upon any termation of this
License, all liabilties and obligations of Licensee hereunder shall contiue in effect until
the Premises ar surendered. Termination shall not release Licensee from any liabilty or
obligation, whether of indemnty or otherwse, resultig from any events happening prior
to the date of termination.
ASSIGNMNT
32. Neither Licensee, nor the heir, legal representatives, successors, or assign of Licensee,
nor any subsequent assignee, shall assign or transfer ths License or any interest herein
without the prior wrtten consent and approval of Licensor, which may be witheld in
Licensor's sole discretion.
Form 421; Rev. 046/05
14
Law Deparent Approved Contrt No. 11-3013
BF#
NOTICES
33. Any notice required or permitted to be given herunder by one par to the other sha be
in wrti and the same shall be given and shall be deemed to have been served and given
if (i) placd in the United States mail, certfied, retu receipt reuested, or (ii) deposited
into the cusody of a nationaly recognized overnght delivery servce, addresse to the
par to be notified at the addrss for such par specified below, or to such other address
as the par to be notified may designte by giving the other par no less th thrt (30)
days' advance wrtten notice of such chage in addrss.
If to Licensr:BNSF Raway Company
2500 Lou Menk Dr. - AOB-3
Fort Wort TX 76131
Att: - Land Revenue Mangement
with a copy to:Iron Hors Development, LLC
c/o Iron Horse Real Estte
111 University Parkwy, Suite 200
Yakma, WA 98901
If to Licensee:PacifiCorp
Right of Way Dept.
825 NE Multnomah St, Suite 1700
Portand, OR 97232
SURVIVAL
34. Neither termination nor expiration will release either par from any liabilty or
obligation under ths License, whether of indemnty or otherse, resultig from any acs,
omissions or events happenig prior to the date of termation or expiration, or, if later,
the date when the Electrc Supply Line and improvements are removed and the Premises
ar restored to its condition as of the Effective Date.
RECORDATION
35. It is undersood and agreed that ths Licee shal not be placed on public record.
APPLICABLE LAW
36. All questions concerng the interretation or application of provisions of this License
shal be decided acordig to the substative laws of the state of Texas without regard to
confcts of law provisions.
Form 421; Rev. 0416/05
15
Law Deparent Approved Contract No. 11-3013
BF#
SEVERAILITY
37. To the maximum extnt possible, eah provision of ths License shal be intereted in
such maner as to be effective and valid under applicable law, but if any provision of ths
License shal be prohibited by, or held to be invalid under, applicable law, such provision
shl be ineffective solely to the extent of such prohibition or invaidity, and th sha not
invalidate the remainder of such provision or any other provision of ths License.
INEGRATION
38. Ths License is the ful and complete agrement between Licensor and Licensee with
respect to al matters relatig to Licensee's use of the Premises, and supersedes any and
all other agrments betwn the pares hereto relating to Licensee's use of the Premises.
However, nothg herein is intended to termate any survig obligation of Licensee or
Licensee's obligation to defend and hold Licensor harless in any prior wrtten
agement between the pares.
MISCELLANEOUS
39. In the event that Licensee consists of two or more pares, all the covenats and
agreements of Licensee herein contaed shal be the joint and several covenats and
ageements of such pares.
40. The waiver by Licensor of the breach of any provision herein by Licensee shall in no way
impair the right of Licensor to enforce tht provision for any subsequent breach theref.
Iron Horse Development, LLC is actng as representative for BNSF Raway Company.
IN WITNESS WHREOF, ths License has been duly executed, in duplicate, by the pares
hereto as of the day and year fist above wrtten.
BNSF RAWAY COMPANY
By:
PACIFICORP
825 Multnomah St., Ste i 700
Portland, OR 97232
By:
Title: .
Form 421; Rev. 04/26105
16
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