Exhibit 10.66
TEST REPORTING, ENGINEERING SERVICES
AND
FIELD SERVICES AGREEMENT
AMONG
ECO FUEL CELLS, LLC, ENERGY CO-OPPORTUNITY, INC.
AND
H POWER CORP.
This Test Reporting, Engineering Services and Field Services Agreement
("Agreement") is entered into this 10 day of April, 2002 (the "Effective Date"),
among H Power Corp., 0000 Xxxxx Xxxxxx, Xxxxxxx, XX 00000; H Power Enterprises
of Canada, Inc. (together "H Power"); and ECO Fuel Cells, LLC ("EFC") and Energy
Co-Opportunity, Inc. ("ECO") both of 0000 Xxxxxxxxxxx Xxx, Xxxxxxx, XX 00000.
These parties are referred to herein singularly as "Party" and collectively as
"Parties." Defined terms used, but not otherwise defined herein, shall have the
respective meanings set forth in the Second Amended and Restated Fuel Cell
Product Operating Agreement, dated April 10, 2002 among the Parties (the
"Operating Agreement").
RECITALS
WHEREAS: The Parties have entered into the Operating Agreement to, among other
things, further encourage the marketing of H Power's Fuel Cell Products, to
provide the Parties with additional marketing and distribution opportunities,
and to explore other products and services offered by H Power including new fuel
cell products and applications; and
WHEREAS: EFC's expertise in distributed generation equipment and installation is
transferable to the ongoing installation and maintenance of H Power's Fuel Cell
Products; and
WHEREAS: H Power desires to secure EFC's expertise in support, installation,
maintenance and other areas to help establish its customer service systems for
Fuel Cell Products; and
WHEREAS: The Parties have been engaged in a Fuel Cell testing program ("Testing
Program") under which H Power's Alpha and Beta Fuel Cell Power Systems have been
tested by EFC and its Cooperative Members in field operating conditions since
2000; and this Testing Program has developed valuable experience and data that
can be used to improve the design and the performance of Fuel Cell Power
Systems; and
WHEREAS: H Power wishes to have EFC collect, review and evaluate data concerning
the Testing Program and prepare a "Report" as defined herein, that will assist H
Power in its future Fuel Cell development plans and operations; and
WHEREAS: EFC has specific expertise in the ongoing Testing Program and also with
distributed generation equipment and installation that makes it exceptionally
qualified to evaluate such field results and to prepare a Report on the Testing
Program as described in this Agreement;
NOW, THEREFORE, in consideration of the promises herein and other valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Parties hereby agree as follows:
1. TEST REPORTING AND ENGINEERING SERVICES.
a. IMPROVEMENTS IN DESIGN AND PERFORMANCE. EFC will review,
evaluate and prepare a written report for H Power summarizing
the test results and information
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Certain portions of this exhibit have been omitted pursuant to a request for
confidential treatment. The omitted materials have been filed separately with
the Securities and Exchange Commission.
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on the Testing Program and identify areas of improvement for
both the design, performance, and similar issues involving the
Fuel Cell Power Systems Testing Program (the "Report"). EFC
will submit a proposed outline of the Report to H Power by May
15, 2002.
b. SITE AND INSTALLATION EVALUATION. EFC will evaluate the site
preparation and other installation costs and the installation
requirements of the Testing Program to determine what savings
and improvements could be made to simplify installation of
future Fuel Cell Power Systems.
c. PLACEMENT SCHEDULE FOR UNIT PLACEMENT. EFC will develop the
placement schedule for the RCU 4500 Units being tested by
Cooperative Members. This will help to match the current phase
of the Testing Program with the best candidates and site
locations for Unit placement. Unit placement recommendations
will be based primarily on the Fuel Cells Products'
specifications and installation and service economics.
d. PLACEMENT ISSUES. EFC will collect and evaluate environmental,
climatic and other related data that were observed and noted
in the Testing Program to develop better criteria for future
Fuel Cell Power System installations throughout the United
States.
e. CUSTOMER INPUT. EFC will secure customer recommendations and
input on the program, design issues, improvements or
suggestions and include them in the Report sections, as
appropriate, to further the design and development of Fuel
Cell Power Systems.
f. GRID COMPATIBILITY. EFC will evaluate the performance data
from the Testing Program to date to identify potential grid
interconnection and power quality issues.
g. HEAT EXCHANGE. EFC will assist in developing residential heat
exchange applications for domestic water and space heating for
both the retrofit and new construction applications.
h. SHIPPING AND DELIVERY. EFC shall work with H Power to evaluate
the information from the Testing Program to determine the most
efficient and effective shipping and delivery methods for Fuel
Cell Power Systems.
i. SERVICING REQUIREMENTS. EFC will evaluate and classify the
different skill levels of utility personnel to determine the
installation and service abilities of Cooperatives relevant to
the Testing Program.
j. ASSUMED OBLIGATIONS. EFC shall assume all obligations and
liabilities of H Power (including, but not limited to, those
set forth in Attachment 3 thereto) with respect to the Fuel
Cell Testing Agreements that have been entered into as of the
Effective Date between ECO or EFC and ECO's Licensed Members,
and H Power shall have no further obligations thereunder. In
addition, except with
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respect to Grandfathered Distribution Agreements, EFC shall
assume all obligations and liabilities of H Power with respect
to the Distribution Agreements and H Power shall have no
further obligations thereunder.
2. FIELD SERVICES SUPPORT TO H POWER.
a. SERVICE AND INSTALLATION SUPPORT FOR FUEL CELL PRODUCTS.
EFC will work with H Power to set up the field service
and support infrastructure to service H Power's Fuel
Cell Products. EFC's support will be in conjunction with
the support activities provided by H Power's personnel,
and will include such activities as consulting with
purchasers about product performance, installation
requirements, maintenance and service concerns. H Power
will be responsible for all warranties that it may
provide from time to time, including its standard
warranty provisions for commercial products and for
warranty service for test units as stipulated in the
Operating Agreement. EFC shall assist H Power in
identifying those tasks necessary for setting up a field
service infrastructure for H Power and those Fuel Cell
activities internal to EFC. Specific tasks to be
performed by EFC shall include:
i. Establish a service organization for the
installation, maintenance and service of H Power's
Fuel Cell Products within the United States. As a
part of this proposal, EFC shall conduct a study
to identify potential service and quality metrics
as based upon customer expectations of the service
network;
ii. Assist in the development of budgets detailing the
anticipated costs of the potential repair and
maintenance of H Power's Fuel Cell Products
deployed in the field;
iii. Develop and assist in managing an installation
system for all Fuel Cell Products within the
United States;
iv. Develop a service data base to assist in
statistical analysis that interfaces with H
Power's sales and marketing data base to support
forward purchasing and the support of spare parts'
purchases;
v. Develop the processes required to continually
reduce the cost of service and installation;
vi. Obtain and/or assist in obtaining the required
permits and licenses for the installation of H
Power's Fuel Cell Products in Cooperative
Territory; and
vii. Implement an electronic data acquisition and
monitoring system, to enable the continuous
monitoring of the performance of H Power's Fuel
Cell Products deployed in the field.
b. LIMITATIONS. IN NO EVENT SHALL THE PARTIES (INCLUDING
THEIR OFFICERS, DIRECTORS, EMPLOYEES, AGENTS AND
ATTORNEYS) BE LIABLE FOR ANY INDIRECT, SPECIAL,
INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING BUT NOT
LIMITED TO LOST PROFITS) IN THE PERFORMANCE OF THEIR
DUTIES UNDER THIS AGREEMENT, EVEN IF THEY HAVE NOTICE OF
THE POSSIBILTY OF SUCH DAMAGES, EXCEPT FOR (I)
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ANY PRODUCT LIABILITY, (II) ANY INFRINGEMENT OF
INTELLECTUAL PROPERTY RIGHTS, AND (III) OTHER DAMAGES
CAUSED BY NEGLIGENCE OR WILLFUL MISCONDUCT OF THE
PARTIES OR THEIR EMPLOYEE(S). HOWEVER, NOTHING HEREIN IS
TO LIMIT OR CHANGE THE PROVISIONS OF THE EFC-H POWER
OPERATING AGREEMENT (AS AMENDED FROM TIME TO TIME).
c. SERVICE, MAINTENANCE, AND FACILITY REQUIREMENTS. EFC
will assist H Power in developing a service and
maintenance resource allocation system with a goal to
maximize customer service at the lowest reasonable cost.
d. CREATION OF AND SUPPORT FOR H POWER'S SERVICE AND
SUPPORT DEPARTMENT. EFC shall propose and arrange for
the development and implementation of a new H Power
Service and Support Department, and shall have a right
of first refusal to manage this Department for H Power
under terms to be agreed to by the Parties; provided
that EFC's proposal is found satisfactory by H Power.
EFC will, in cooperation with H Power:
i. Develop position descriptions, hiring criteria,
and a performance evaluation process for service
and support employees;
ii. Work with H Power's engineering and other staff to
develop servicing and maintenance requirements for
Fuel Cell Products compatible with the product
design;
iii. Assist H Power in determining H Power's
requirements for the hiring of an after market
service and support manager; and field service
engineers, if appropriate.
e. CREATION OF AND SUPPORT FOR H POWER'S DOMESTIC SERVICE
NETWORK. EFC shall assist in the creation of H Power's
domestic service network, and shall have the right of
first refusal to manage this network, under terms to be
agreed to by the Parties, including the following
duties:
i. Identify those Cooperative members deemed suitable
to be appointed as a field service office to
support field service and installation hereinafter
(the "Satellite Offices");
ii. Determine the suitable geographical locations
within the United States to maintain field service
office(s);
iii. Perform a field study to determine the use of HVAC
suppliers, renewable energy systems integrators,
or mechanical and electrical contractors to
support the field service and installation
function; and
iv. Assist H Power in maintaining a minimum inventory
of spare parts in the Satellite Offices to support
field services repairs.
f. TRAINING AND DOCUMENTATION. EFC shall assist H Power in
H Power's on-going process of documentation development
and training development for H Power's Fuel Cell
Products, including:
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i. Develop manuals for Fuel Cell Products with the
assistance of H Power engineers, including
installation, operation and service and
maintenance; and
ii. Assist in the training of field service personnel
at H Power's Monroe facility in the installation
and operation and repair of H Power's Fuel Cell
Products.
g. PROCESS RELATED ISSUES
i. Reporting
EFC shall assist H Power in creating and
implementing a service reporting and
analysis system for all Fuel Cell Products
that includes performance issues, the number
and nature of field service calls, and other
items.
ii. Continual Product Improvement
EFC shall work with ECO's Engineering
Committee and others as appropriate to
establish a system that captures performance
information from Fuel Cell Product users to
assist H Power in achieving its goal of
continued product improvement.
3. PROJECT MANAGER. EFC's Project Manager for this Agreement
shall be Xxxxx Xxxxxxxx. The Project Manager shall, in
addition to the other duties prescribed in this Agreement,
develop a travel budget for this Agreement, working closely
with H Power. During the term of this Agreement, Xx. Xxxxxxxx
shall integrate the H Power activities described herein into
his EFC workload, and shall be responsible for establishing
work priorities, schedules, and completion of work requests.
Xx. Xxxxxxxx shall inform both EFC and H Power when potential
or real conflicts of activities or scheduling exist, and the
Parties shall mutually resolve such conflicts for Xx.
Xxxxxxxx. During the term of this Agreement, H Power shall not
solicit any EFC staff for employment.
H Power and EFC shall agree to prepare travel (including
transportation, lodging, meals, and entertainment) and other
budgets from time to time to carry out the purposes of this
Agreement. In addition to the payments made under Attachment A
of this Agreement, any travel to be performed at H Power's
request that exceeds $3,000 per month shall be paid for by H
Power, except as may otherwise be agreed to in writing by the
Parties. EFC shall provide satisfactory documentation for such
expenses in such detail as H Power may reasonably request.
4. PAYMENT FOR TEST REPORTING, ENGINEERING AND FIELD SERVICES.
Subject to Sections 5, 6 and 7 hereof, in exchange for the
above services, H Power will pay EFC up to $2.2 million per
the Schedule in Attachment A of this Agreement. EFC may xxxx H
Power monthly or quarterly for its services. Payment of
invoices will be due and payable 15 days after receipt by H
Power.
5. AFFIRMATIVE AND NEGATIVE COVENANTS.
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Notwithstanding anything contained in this Agreement to the
contrary, this Agreement is subject to certain binding
Affirmative and Negative Covenants ("Covenants") contained in
a "Memorandum of Agreement," entered into by the Parties on
the date of this Agreement.
6. NO MATERIAL ADVERSE CHANGE. Notwithstanding anything contained
in this Agreement to the contrary, H Power shall have no
obligation to make payments to EFC during the Term hereof, if
there has been a "Material Adverse Change." For the purposes
of this Agreement, a Material Adverse Change shall only be
defined as a material violation of Sections 2, 3, 4, or 5 of
the Memorandum of Agreement.
7. FAILURE TO COMPLY. Notwithstanding anything contained in this
Agreement to the contrary, upon ECO's and/or EFC's breach of
any of the Affirmative or Negative Covenants set forth in the
Memorandum of Agreement, H Power shall have the unilateral
right to suspend payment of any monies due to EFC hereunder
(including those set forth on Attachment A hereto) until such
time that ECO and/or EFC cures such breach to H Power's
satisfaction.
8. TERM.
This Agreement shall terminate upon: i) the completion of
EFC's and ECO's duties referred to herein; or ii) the written
agreement of the Parties.
9. DISPUTES.
The Parties agree that any and all controversies or claims
arising out of or relating to this Agreement, or any alleged
breach hereof, shall be resolved by binding arbitration as
prescribed herein, upon 30 days' written notice to the other
Party. In that event, each Party will select one (1)
arbitrator, and those two (2) will select a third. The
arbitrators shall conduct the arbitration under the then
current rules of the American Arbitration Association ("AAA"),
unless otherwise provided herein. The arbitrator(s) will be
selected in accordance with AAA procedures from a list of
qualified arbitrators maintained by AAA. The arbitration will
be conducted in Washington, D.C. and all expedited procedures
prescribed under AAA rules will apply. Unless the Parties
otherwise agree, the proceedings will be completed within
forty-five (45) days of the Parties' receipt of notice of
arbitration. Each Party will bear its own costs and attorney's
fees and disbursements; and shall share equally the costs of
the arbitrators.
10. MUTUAL COOPERATION.
The Parties agree to take such other actions and execute such
other documents as shall be necessary to carry out the
provisions of this Agreement.
11. INTEGRATION.
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With the exception of the Operating Agreement and the
Memorandum of Agreement, this Agreement (including any
Schedules and Exhibits attached hereto) constitutes the entire
agreement among the Parties with respect to the subject matter
hereof and supercedes all prior and contemporaneous agreements
and undertakings, written or oral, of any nature whatsoever of
the Parties hereto with respect to the subject matter hereof.
12. NOTICES. All notices, and other communications hereunder shall
be in writing and shall be deemed to have been duly given when
delivered in person, by telecopy (with confirmation of
transmission), by express or overnight mail delivered by a
nationally recognized air courier (delivery charges prepaid),
or by registered or certified mail (postage prepaid, return
receipt requested) to the Parties at their respective
addresses set forth in the preamble of this Agreement or to
such other address as the Party to whom notice is given may
have previously furnished to the other Parties in writing in
the manner set forth above. Any notice or communication
delivered in person shall be deemed effective on delivery. Any
notice or communication sent by telecopy or by air courier
shall be deemed effective on the first business day at the
place at which such notice or communication is received
following the day on which such notice or communication was
sent. Any notice or communication sent by registered or
certified mail shall be deemed effective on the fifth business
day at the place from which such notice or communication was
mailed following the day on which such notice or communication
was mailed.
13. PARTY'S RELATIONSHIP. Neither Party by this Agreement makes
the other Party its legal representative or agent. Neither
Party shall assign this Agreement to any other third party,
without the other Party's prior written permission, except
that ECO and ECO Fuel Cells may assign it to a Cooperative
Member.
14. NO RIGHTS IN THIRD PARTIES. Nothing contained in this
Agreement shall be construed as giving rise to any rights to
enforce its provisions to any person or entity not a Party to
this Agreement under any legal theory.
15. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original
as against any Party whose signature appears thereon, and all
of which shall together constitute one and the same
instrument. This Agreement shall become binding when one or
more counterparts hereof, individually or taken together,
shall bear the signatures of all the Parties hereon as
signatories.
16. SEVERABILITY. If any provision of this Agreement for any
reason shall be held to be illegal, invalid or unenforceable,
such illegality shall not affect any other provision of this
Agreement, but this Agreement shall be construed as if such
illegal, invalid or unenforceable provision had never been
included herein.
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IN WITNESS WHEREOF the undersigned Parties hereby execute this Agreement.
H POWER CORP. H POWER ENTERPRISES OF CANADA, INC.
/s/ Xxxxxxx X. Xxxx /s/ H. Xxxxx Xxxxxxx
------------------------------- -----------------------------------
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ECO FUEL CELLS, LLC ENERGY CO-OPPORTUNITY INC.
/s/ Xxxxxxx X. Xxxxx /s/ Xxxxxxx X. Xxxxx
---------------------------------- ------------------------------------
Xxxxxxx X. Xxxxx, President & CEO Xxxxxxx X. Xxxxx, President and CEO
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ATTACHMENT A
TEST REPORTING, ENGINEERING SERVICES AND FIELD SERVICES AGREEMENT
AMONG
ECO FUEL CELLS, LLC, ENERGY CO-OPPORTUNITY INC.
AND
H POWER CORP.
H POWER'S PAYMENTS TO EFC
Subject to the terms and conditions set forth in the Agreement, H Power
shall make the following payments to EFC:
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APRIL 2002 QTR 2-2002 QTR 3-2002 QTR 4-2002 SUBTOTAL
=====================================================================================================
Field Services [*] [*] [*] [*] [*]
-----------------------------------------------------------------------------------------------------
Test Program Evaluation/Report [*] [*] [*] [*] [*]
=====================================================================================================
TOTAL [*] [*] [*] [*] [*]
-----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------------
QTR 1-2003 QTR 2-2003 QTR 3-2003 QTR 4-2003 TOTALS
==========================================================================================================
Field Services [*] [*] [*] [*] [*]
----------------------------------------------------------------------------------------------------------
Test Program Evaluation/Report [*] [*] [*] [*] [*]
==========================================================================================================
TOTAL [*] [*] [*] [*] $2,200,000
----------------------------------------------------------------------------------------------------------
---
* Confidential
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