Prevent Your Tenant Mix from Turning Your Property into a 'REC'

Last month, we discussed RECs (recognized environmental conditions) in depth. This month, we present a sample clause regarding a tight tank for a hypothetical Massachusetts hair salon:

Tight Tank

As a part of Tenant's Work to the demised premises, Tenant shall install a containment tight tank, which is a tank used solely in connection with the demised premises for the containment of chemical substances in relation to Tenant's Business. The containment tank and all related piping and other fixtures are collectively referred to as the “Tight Tank.” The exact location of the Tight Tank shall be subject to Landlord's prior written approval, and the installation of the Tight Tank shall be performed at Tenant's expense, and in accordance with plans and specifications (in such detail as Landlord may require), which have first been approved by Landlord.

Tenant acknowledges and agrees that Tenant is strictly prohibited from connecting any pipes, sinks, drains, toilets or other fixtures, relating to the Tight Tank to the sewerage disposal facilities of the demised premises or the Shopping Center. Landlord and Tenant agree that Tenant is required to connect all drains, pipes, sinks, toilets or other fixtures, which in anyway transmit chemical substances used in connection with Tenant's Business, to the Tight Tank.

During the term of this lease, Tenant shall (i) maintain, repair and replace the Tight Tank in compliance with the lease, including but not limited to Section 10.18 hereof, and in conformity with all applicable laws and regulations, as well as dispose of the contents of the Tight Tank in strict compliance with all applicable laws and regulations; (ii) obtain and maintain in full force and effect, all licenses, permits, or approvals required for the installation, operation, maintenance and use of the Tight Tank; (iii) perform all monitoring and testing required by any applicable laws or regulations in connection with the Tight Tank; (iv) maintain adequate records in connection with the Tight Tank as required by any applicable laws or regulations; (v) promptly clean up or take whatever corrective actions, including modifications, which may be required by any applicable laws and regulations in connection with the use or operation of the Tight Tank (including but not limited to any acts or omissions in relation thereto); and (vi) maintain pollution liability insurance, or its equivalent, in accordance with the provisions of the lease, including but not limited to Sections 6.10, 6.11 and 6.12 hereof, in an amount not less than $1,000,000.00, covering any release from the Tight Tank. Throughout the term of this lease, Landlord shall have the right to inspect the Tight Tank, to ensure Tenant is in compliance with the requirements of this Article XX. Tenant shall promptly notify Landlord of any governmental orders or notices regarding the Tight Tank and shall supply Landlord with a copy of the same, together with copies of the materials listed in this Section XX (c) (ii), (iii) and (iv) herein

Yield Up

At the end of the term, Tenant shall peaceably yield up to Landlord the demised premises and all alterations, additions and changes made to or upon the same in good order, repair and condition in all respects, except for damage resulting from fire, casualty, taking by eminent domain, or act of or pursuant to public authority. Tenant shall remove all chemical products stored at the site, and at Landlord's election, Tenant shall also remove any equipment that contained regulated or controlled materials, including the Tight Tank, being used in connection with the demised premises. If Landlord elects to have Tenant remove the Tight Tank, then Tenant further covenants and agrees that it will (i) repair all damage caused or exposed by such removal of the Tight Tank (ii) remove all chemicals from and relating to the Tight Tank in compliance with all federal, state and local environmental laws, regulations and ordinances, including, without limitation, those regulations promulgated by the Massachusetts Department of Environmental Protection (or similar regulatory agency) and shall provide Landlord with evidence of such removal (e.g., removal manifests); and (iii) shall defend, indemnify and hold Landlord harmless from and against any and all claims arising from or in any way connected to the storage, use or removal of the chemical products, the equipment containing regulated or controlled materials and the Tight Tank.

Am'lie H. Mailloux is an attorney for Stop & Shop in the real estate law department and deals primarily with commercial real estate transactions.

Last month, we discussed RECs (recognized environmental conditions) in depth. This month, we present a sample clause regarding a tight tank for a hypothetical Massachusetts hair salon:

Tight Tank

As a part of Tenant's Work to the demised premises, Tenant shall install a containment tight tank, which is a tank used solely in connection with the demised premises for the containment of chemical substances in relation to Tenant's Business. The containment tank and all related piping and other fixtures are collectively referred to as the “Tight Tank.” The exact location of the Tight Tank shall be subject to Landlord's prior written approval, and the installation of the Tight Tank shall be performed at Tenant's expense, and in accordance with plans and specifications (in such detail as Landlord may require), which have first been approved by Landlord.

Tenant acknowledges and agrees that Tenant is strictly prohibited from connecting any pipes, sinks, drains, toilets or other fixtures, relating to the Tight Tank to the sewerage disposal facilities of the demised premises or the Shopping Center. Landlord and Tenant agree that Tenant is required to connect all drains, pipes, sinks, toilets or other fixtures, which in anyway transmit chemical substances used in connection with Tenant's Business, to the Tight Tank.

During the term of this lease, Tenant shall (i) maintain, repair and replace the Tight Tank in compliance with the lease, including but not limited to Section 10.18 hereof, and in conformity with all applicable laws and regulations, as well as dispose of the contents of the Tight Tank in strict compliance with all applicable laws and regulations; (ii) obtain and maintain in full force and effect, all licenses, permits, or approvals required for the installation, operation, maintenance and use of the Tight Tank; (iii) perform all monitoring and testing required by any applicable laws or regulations in connection with the Tight Tank; (iv) maintain adequate records in connection with the Tight Tank as required by any applicable laws or regulations; (v) promptly clean up or take whatever corrective actions, including modifications, which may be required by any applicable laws and regulations in connection with the use or operation of the Tight Tank (including but not limited to any acts or omissions in relation thereto); and (vi) maintain pollution liability insurance, or its equivalent, in accordance with the provisions of the lease, including but not limited to Sections 6.10, 6.11 and 6.12 hereof, in an amount not less than $1,000,000.00, covering any release from the Tight Tank. Throughout the term of this lease, Landlord shall have the right to inspect the Tight Tank, to ensure Tenant is in compliance with the requirements of this Article XX. Tenant shall promptly notify Landlord of any governmental orders or notices regarding the Tight Tank and shall supply Landlord with a copy of the same, together with copies of the materials listed in this Section XX (c) (ii), (iii) and (iv) herein

Yield Up

At the end of the term, Tenant shall peaceably yield up to Landlord the demised premises and all alterations, additions and changes made to or upon the same in good order, repair and condition in all respects, except for damage resulting from fire, casualty, taking by eminent domain, or act of or pursuant to public authority. Tenant shall remove all chemical products stored at the site, and at Landlord's election, Tenant shall also remove any equipment that contained regulated or controlled materials, including the Tight Tank, being used in connection with the demised premises. If Landlord elects to have Tenant remove the Tight Tank, then Tenant further covenants and agrees that it will (i) repair all damage caused or exposed by such removal of the Tight Tank (ii) remove all chemicals from and relating to the Tight Tank in compliance with all federal, state and local environmental laws, regulations and ordinances, including, without limitation, those regulations promulgated by the Massachusetts Department of Environmental Protection (or similar regulatory agency) and shall provide Landlord with evidence of such removal (e.g., removal manifests); and (iii) shall defend, indemnify and hold Landlord harmless from and against any and all claims arising from or in any way connected to the storage, use or removal of the chemical products, the equipment containing regulated or controlled materials and the Tight Tank.

Am'lie H. Mailloux is an attorney for Stop & Shop in the real estate law department and deals primarily with commercial real estate transactions.