Estimated Costs and Payment Terms. 4.1 The Company’s estimated cost for completion of the Engineering & Procurement services is specified in Attachment A (the “Estimated Cost”). The Estimated Cost constitutes the Company’s good faith estimate of the cost for the Engineering & Procurement services through to the execution of the IA, pursuant to this Agreement. The actual costs to be paid by the Customer will be the actual costs incurred by the Company, which may vary from the Estimated Cost, as described in Section 4.3 below. Any costs for the Engineering & Procurement in excess of the Estimated Cost are “Additional Costs”. Typically, under NYSEG’s E&P Agreement, NYSEG requires the customer to provide payment security such as a letter of credit to guaranty NYSEG receives payment for the work NYSEG will undertake. In this instance NYSEG has arranged the payment schedule so that NYSEG will not be required to perform work until the funding to pay for that work has been received. By arranging the payments this way, the Customer will not be required to submit security such as a letter of credit. The intention of this provision is to be clear that the Company shall only expend funds toward the payment of Engineering and Procurement if sufficient funds have first been received from the Customer. NYSEG requires payment of the estimated cost of work in advance.
Estimated Costs and Payment Terms. 4.1 The Company’s estimated cost for completion of the Company Work is specified in Exhibit A (the “Estimated Cost”). The Estimated Cost constitutes the Company’s good faith estimate of the cost to complete the Company Work pursuant to this Agreement. The actual costs to be paid by the Customer will be the actual costs incurred by the Company, which may vary from the Estimated Cost, as described in Sections 4.3 and 4.4 below. Any costs for the Company Work in excess of the Estimated Cost are “Additional Costs.” Typically, the Company requires the Customer to provide payment security such as a letter of credit to guaranty the Company receives payment for the work that Company will undertake. In this instance, Customer has agreed to provide an Initial Prepayment, as described below, and Customer will not be required to submit security such as a letter of credit.
