Exhibit 10.40
PURCHASE AGREEMENT
BETWEEN
MOUNTAINVIEW POWER COMPANY
AND
GENERAL ELECTRIC COMPANY
FOR
FOUR PG7241 FA COMBUSTION TURBINE GENERATORS
FOR THE
MOUNTAINVIEW GENERATION PROJECT
October 25, 1999
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
APPENDICES
A. SCOPE OF WORK (GE Xxxxxxxx # 00000XX dated September 1999)
B. PERSONNEL TRAINING PROGRAM
C. QUALITY ASSURANCE PROGRAM
D. PAYMENT/TERMINATION SCHEDULE
E. SAMPLE GE MONTHLY REPORT Schedule 1: Final Lien Waiver Form
F. INTENTIONALLY OMITTED
G. APPROVED TEST PROCEDURES
H. INTENTIONALLY OMITTED
I. CONFIDENTIALITY AGREEMENT
J. FORM OF RETAINAGE BOND.
K. TECHNICAL ADVISORY SERVICES
L. FUELS SPECIFICATION
M. PRICING SUMMARY/OPTIONS
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TABLE OF CONTENTS
SECTION 1: DEFINITIONS......................................................5
SECTION 2: GENERAL TERMS OF SALE...........................................9
SECTION 3: OBLIGATION TO PROCEED..........................................10
SECTION 4: PERSONNEL TRAINING; OPERATING MANUAL...........................10
SECTION 5: QUALITY ASSURANCE..............................................10
SECTION 6: RESERVED..........................................................
SECTION 7: PAYMENT........................................................10
SECTION 8: TAXES..........................................................12
SECTION 9: PRICE ADJUSTMENTS..............................................13
SECTION 10: INSPECTION AND FACTORY TESTS..................................13
SECTION 11: TITLE TRANSFER, RISK OF LOSS, SHIPMENT TO STORAGE.............14
SECTION 12: COMPLIANCE WITH APPLICABLE LAWS AND PERMITS...................14
SECTION 13: EXPORT PROHIBITIONS............................................15
SECTION 14: CHANGES.......................................................16
SECTION 15: NON-RECOURSE OBLIGATIONS......................................16
SECTION 16: MECHANICAL COMPLETION..........................................16
SECTION 17: GUARANTEED SHIPMENT DATE; LIQUIDATED DAMAGES FOR LATE SHIPMENT.18
SECTION 18: PERFORMANCE TESTS.............................................19
SECTION 19: PERFORMANCE GUARANTEES........................................20
SECTION 20. ACHIEVMENT OF PERFORMANCE GUARANTEES..........................22
SECTION 21. ACCEPTANCE.....................................................23
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TABLE OF CONTENTS
SECTION 22: INTENTIONALLY LEFT BLANK..........................................
SECTION 23: PERFORMANCE GUARANTEE PAYMENTS AND REMEDIES.....................24
SECTION 24: WARRANTIES......................................................25
SECTION 25: FORCE MAJEURE EVENT..........................................26
SECTION 26: INDEMNITIES...................................................28
SECTION 27: LIMITATIONS OF LIABILITIES....................................29
SECTION 28: CONSEQUENTIAL DAMAGES...........................................30
SECTION 29: SELLER-PROVIDED INSURANCE......................................30
SECTION 30: BUYER-PROVIDED INSURANCE........................................32
SECTION 31: DEFAULT AND REMEDIES............................................33
SECTION 32: ASSIGNMENTS.....................................................34
SECTION 33: PERFORMANCE IN FAVOR OF FINANCING PARTIES.......................35
SECTION 34: BUYER REVIEW OF DOCUMENTS.......................................35
SECTION 35: WAIVERS.........................................................36
SECTION 36: GOVERNING LAW...................................................36
SECTION 37: SEVERABILITY....................................................37
SECTION 38: NOTICES........................................................37
SECTION 39: HEADINGS AND INTERPRETATION RULES..............................38
SECTION 40: ENTIRE AGREEMENT................................................38
SECTION 41: SELLER'S PROPRIETARY INFORMATION................................38
SECTION 42: PUBLICITY RELEASES; INFORMATION................................38
SECTION 43: NON NUCLEAR USE................................................38
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THIS PURCHASE AGREEMENT ("AGREEMENT") IS ENTERED INTO OCTOBER 25, 1999, BY AND
AMONG GENERAL ELECTRIC COMPANY, A NEW YORK CORPORATION, HAVING A PRINCIPAL PLACE
OF BUSINESS AT 0 XXXXX XXXX, XXXXXXXXXXX, XXX XXXX 00000 XXX ("GE" OR "SELLER")
AND MOUNTAINVIEW POWER COMPANY, A DELAWARE CORPORATION, HAVING A PRINCIPAL PLACE
OF BUSINESS AT 000 XXXXXX XX, XXXXX 000, XXXXXXX, XX 00000 ("BUYER") (GE AND
BUYER BEING REFERRED TO HEREIN INDIVIDUALLY AS A "PARTY" AND COLLECTIVELY THE
"PARTIES").
RECITALS
WHEREAS, GE is, among other things, a manufacturer of combustion and steam
turbine generator equipment; and
WHEREAS, Buyer is, among other things, in the business of independent power
generation facility development and operation.
WHEREAS, Seller has the desire to sell four (4) new PG7241 (FA) gas
turbine-generators (the "Turbine Generator Units") to the Buyer and ship
two Turbine Generator Units prior to August 31, 2002 and two Turbine
Generator Units prior to September 30, 2002 which is expected to be used by
Buyer in its development and construction of the Mountainview Generation
Project (the "Project"); and
WHEREAS, Buyer desires to purchase, and Seller desires to sell four (4)
PG7241FA Gas Turbine Generators for the Project, subject to the terms and
conditions of this purchase agreement ("AGREEMENT");.
NOW, THEREFORE, in consideration of the premises and mutual covenants set forth
herein the Parties agree as follows:
SECTION 1: DEFINITIONS
"Acceptance" Acceptance shall have the meaning in Section 21 hereof.
"Applicable Laws and Permits" means all laws, ordinances, rules & regulations,
permits and, judgments, decrees, injunctions, orders of any court, arbitrator or
governmental agency or authority, having jurisdiction over the location where
the Work is to be performed.
"Applicable Codes and Standards" means those codes and standards applicable to
the design, engineering, manufacture, workmanship and equipment applicable to
the Scope of Work, as more fully described in the Scope of Work.
"Approved Test Procedures" means the test procedures set forth in Appendix G
hereto as amended and supplemented in accordance with this Agreement.
"Base Labor Index" shall be as defined in Section 9.
"Base Materials Index" shall be as defined in Section 9.
"Business Days" means all calendar days, except Saturday, Sunday and such other
days on which banks in the State of California are required or authorized to
close.
"Buyer Taxes" shall have the meaning in Section 8.2
"Contract Price" shall have the meaning in Section 7.2
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"Damages" shall mean suits, judgements, expenses, losses, costs, damages,
injuries, obligations, liabilities, claims, demands, royalties, penalties,
interest and causes of action, including without limitation reasonable
attorney's fees (collectively the "Damages") as they may apply to third party
claims pursuant to Section 26.
"Defects or Deficiencies" means, any materials, equipment, tools, supplies which
(i) do not conform to the Agreement, (ii) would materially and adversely affect
the performance of the Turbine Generator Units under the Performance Guarantees
or would materially and adversely affect the capability of the Turbine Generator
Units to be operated on a continuous basis; or (iii) affect the ability of the
Turbine Generator Units to be operated in accordance with Applicable Laws and
Permits or Applicable Codes and Standards.
"Delay Payments" shall include Late Guaranteed Shipment Delay Payments and Late
Substantial Completion Delay Payments.
"Delivery Point" means the Project Site for shipments made via common carrier,
and to the nearest rail siding for shipments made via rail.
"Emission Guarantee" shall be as defined in Section 19.4
"EPC Contractor" shall be as defined in Section 23.5.
"Financing Parties" means any and all lenders providing the construction,
interim or long-term financing (including any refinancing thereof) for the
Project.
"Force Majeure" shall be as defined in Section 25.
"General Warranty" shall be as described in Section 24
"Good Electric Power Producing Practices" means those construction, operation
and maintenance practices, methods and procedures, as modified by published
guidelines from time to time, that are generally accepted by the electric power
producing industry in North America, as of the date of this Agreement. Those
practices which are commonly used in prudent electric power producing
engineering and operations to construct, operate and maintain equipment
lawfully, safely, dependably and economically, as applied by the Seller to units
of the size and type used for the Project.
"Guarantee Conditions" shall have the meaning in Section 19.1
"Guaranteed Heat Rate" shall have the meaning in Section 19.1
"Guaranteed Shipment Dates" shall be as described in Section 17.1
"Late Guaranteed Shipment Delay Payments" shall be as described in Section 17.2
"Late Substantial Completion Delay Payments" shall be as described in Section
16.1.5
"Liens" shall have the meaning in Section 7.11.
"Hazardous Material" means any toxic or hazardous waste, pollutants or
substances, including, without limitations, asbestos, PCBs, petroleum products
and by-products, substances defined or listed as "hazardous substance", "toxic
substance", "toxic pollutant", or similarly identified substances or mixtures,
in or pursuant to any environmental law, including, but not limited to, the
Comprehensive Environmental Response, Compensation
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and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq., the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1802, et seq. , the
Resource Conservation and Recovery Act, 42 U.S.C. Section 6901, et seq., the
Toxic Substance Control Act of 1976, as amended, 15 U.S.C. Section 2601, et
seq., and the Clean Water Act, 33 U.S.C. Section 446 et seq., as amended, and
any substance regulated as hazardous under Florida state law.
"Mechanical Completion" shall have the meaning provided in Section 16.
"Minimum Performance" shall mean achieving (i) less than or equal to 105% of the
Heat Rate Guarantee while achieving 100% of the Emission Guarantee, (ii) greater
than or equal to 95% of the Turbine Generator Unit Electrical Output Guarantee
while achieving 100% of the Emission Guarantees.
"Natural Gas" shall mean the fuel delivered by pipeline to the Turbine Generator
Units and in accordance with the fuel specification attached as Appendix L,
Fuels Specification.
" Heat Rate Guarantee" shall have the meaning in section 19.2
"Notice of Acceptance" shall have the meaning in Section 21.2
"Notice of Default" shall have the meaning in Section 31
"Notice of Mechanical Completion" means when Buyer delivers to Seller a notice
of Mechanical Completion.
"Notice of Performance Test Success" shall have the meaning of Section 20.1
"Notice of Substantial Completion" means when Buyer delivers to Seller a notice
of Substantial Completion.
"Operating Criteria" means the mode of operation of the Turbine Generator Units
combusting Natural Gas fuel
"Operating Manual" means the complete equipment and system instructions and
procedures for the start-up, operation and maintenance of the Turbine Generator
Units.
"Options" shall have the meaning in Section 7.2 hereof.
"Parties" shall mean Seller or Buyer.
"Payment/Termination Schedule" shall be in accordance with Appendix D
"Performance Tests" means the operation of the Turbine Generator Unit in
accordance with the provisions of Section 18 hereof and the Approved Test
Procedures for the purposes of determining each Turbine Generator Unit's level
of achievement of one or more of the Performance Guarantees, as defined in
Section 19 hereof.
"Performance Guarantees" shall have the meaning in Section 19 hereof.
"Performance Guarantee Payments" shall have the meaning in Section 23.
"Permit" means any waiver, exemption, variance, franchise, permit,
authorization, license or similar order of or from any federal, state, county,
municipal, regional, environmental or
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
other governmental body, instrumentality, agency, authority, court or other body
having jurisdiction over the matter in question.
"Project" shall mean the Mountainview Generation Project, an electrical
generating facility being developed in San Bernardino, California.
"Project Site" means certain parcels of land in San Bernardino, California, and
any other real estate rights of Buyer upon which the Project will be located or
from which the Project will otherwise benefit.
"Punch List" means the list prepared (and periodically revised) by Buyer, of
minor items of work which may remain to be performed by Seller after Acceptance,
but which items do not affect Buyer's ability to operate the Turbine Generator
Units in accordance with Applicable Laws and Permits and the Agreement.
"Quality Assurance Program" is Seller's written quality assurance program for
the work, including the written procedures to implement such program, as
described in Appendix C.
"Reliability Guarantee" shall have the meaning in Section 19.5
******************************************************************
"Rewarranty Period" shall have the meaning in Section 24.4
"Revised Guaranteed Shipment Date" shall have the meaning in Section 7.2.
"Seller Taxes" Shall have the meaning in Section 8.1.
"Scope Changes" means a material addition to, deletion from, or other
modification to, the quality, function or scope of the Turbine Generator Units
as delineated in the Scope of Work, or a material change to the requirements of
this Agreement, but shall not include Seller's correction of the Work from time
to time pursuant to the Scope of Work or Seller's warranties.
"Scope of Work" shall be as described in Appendix A.
"Steam Turbines" shall have the meaning in Section 2
"Subcontract" means a contract between Seller and a Subcontractor for the
performance or supply of a portion of the Work by such Subcontractor.
"Subcontractor" shall mean any subcontractor of Seller.
"Substantial Completion" shall have the meaning provided in Section 16.1.4
"Substantial Completion Cure Period" shall have the meaning provided in Section
16.1.5.
"Technical Advisory Services" shall be as described in Appendix K.
"Termination for Cause" shall have the meaning in Section 31.
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"Termination for Convenience" shall have the meaning in Section 31.
"Training Services" shall be as described in Appendix B.
"Turbine Generator Unit(s)" shall be as described in Section 2.
"Turbine Generator Units Electrical Output Guarantee" shall be as described in
Section 19.3.
"Warranty Period" shall have the meaning of Section 24.1
"Work" shall mean all work, manufacture and technical direction of the
installation of the Turbine Generator Units on the Project Site as more fully
described in the Scope of Work.
SECTION 2: GENERAL TERMS OF SALE
A. The Turbine Generator Units shall meet all the requirements of this
Agreement including, but not limited to, the Scope of Work, and shall meet
all the requirements of (i) Seller's design criteria, manufacturing
processes and procedures and Quality Assurance Program, (ii) those portions
of industry specifications, codes and standards in effect as of the date of
this Agreement, which are deemed applicable by Seller to the Work, (iii)
the United States Federal, State and local laws and rules applicable to the
locations where the Work is performed in effect as of the date of this
Agreement. Buyer agrees to buy, and Seller agrees to sell, subject to the
terms and conditions of this Agreement.
Four (4) PG 7241 FA gas turbine generators for combined cycle
use, using a dry low NOx combustion system, combusting Natural
Gas Fuel, and associated auxiliary equipment as more completely
defined in Appendix A, Scope of Work, (collectively, the "Turbine
Generator Units" or individually the "Turbine Generator Unit").
Two Turbine Generator Units to be shipped no later than August
31, 2002 and two Turbine Generator Units to be shipped no later
than September 30, 2002. Seller shall also provide personnel
qualified to give technical advice relative to the installation
and startup of the Turbine Generator Units (as described herein
and as further defined in Appendix K, the "Technical Advisory
Services"). Seller shall also provide training services (the
"Training Services") for Buyer's personnel as described in
Appendix B Personnel Training Program. The Technical Advisory
Services and Training Services and any optional services provided
are referred to herein as the "Services."
It is expressly understood that the Seller will have the right to utilize
all resources within its global manufacturing and vendor network to supply
the requirements of this Agreement for the supply of the Turbine Generator
Units.
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
**********************************************************
SECTION 3: OBLIGATION TO PROCEED
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SECTION 4: PERSONNEL TRAINING; OPERATING MANUAL
Commencing as soon as practicable prior to start-up operations, Seller shall
provide on-site classroom training for the operation and maintenance personnel.
Such Training Services, as more fully described in Appendix B, shall be designed
to offer basic instruction and training to the operation and maintenance
personnel, and shall be of such quality as to provide the operation and
maintenance personnel with a reasonable understanding of the major, critical
operational and maintenance aspects of the Turbine Generator Units. Seller shall
provide a minimum of eighteen (18) copies of the appropriate manuals and other
written materials as part of the training program (hereinafter the "Operating
Manual"). Buyer shall provide a suitable classroom for the Seller's training of
the operation and maintenance personnel.
SECTION 5: QUALITY ASSURANCE
Seller shall fully observe and implement its Quality Assurance Program as more
fully described in Appendix C until Acceptance. All tests, inspections and
quality assurance procedures required by this Agreement shall be in addition to,
and not in lieu of, applicable Quality Assurance Program activity. Seller shall
inspect and test the Work, including all design, installation, engineering,
materials and services performed or provided. Seller shall correct all Defects
or Deficiencies within a reasonable time. Seller's compliance with Seller's
Quality Assurance Program in accordance with the procedures contained therein is
a requirement of this Agreement.
SECTION 6: RESERVED
SECTION 7: PAYMENT
7.1 ***************************************************************
7.2
Buyer agrees to pay Seller a base price of
********************************************************("Contract Price") for
shipment and Acceptance of the Turbine Generator Units and completion of the
Scope of Work set forth in Appendix A, as may be adjusted by such amounts
associated with options that Buyer elects to include or exclude in the Scope of
Work as described in Appendix M (the "Options") or as adjusted by any change
orders pursuant to Section 14. Buyer shall notify Seller of all Options Buyer
wishes to include 15 months prior to the Guaranteed Shipment Dates. The Contract
Price may be subsequently modified through changes to the Scope of Work pursuant
to Section 14 hereof. The Contract Price set forth above includes freight and
delivery to the Delivery Point.
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
7.3 Seller retains the right to determine transportation mode.
7.4 Paymentsof the Contract Price shall be made in accordance with the
Payment/Termination Schedule as set forth in Appendix D, provided that
Seller has complied with all the material terms and conditions of this
Agreement. The progress payments in Appendix D listed as payable in
March and April of 2001 may be delayed by Buyer until May 2001. Such
delayed payments will be then payable in May 2001 (together with the
scheduled May 2001 payment), and will be paid to Seller with interest.
The interest shall be calculated utilizing an annual rate equal to the
U.S. prime lending rate published, on the day the payment was due, by
Citibank N.A., plus two percent (2%) from the date the payment was
originally scheduled to be made until the actual payment is made.
7.5 ****************************************************************
7.6 Thirty (30) days prior to each scheduled payment, Seller shall submit
to Buyer a written request or invoice for the applicable payment set
forth on the Payment/Termination Schedule. No payment to Seller or any
use of the Turbine Generator Units by Buyer shall alone constitute an
acceptance of any of the Work or relieve Seller of any of its
obligations or liabilities with respect thereto.
7.7 Seller shall submit to Buyer all information required to be submitted
with each payment request pursuant to Appendix E. Seller shall furnish
to Buyer with each payment request the information listed in Appendix E
hereto relating to such payment request and which are necessary to
satisfy the requirements of all state and local tax authorities.
7.8 Subjectto the terms of this Agreement, and provided that Buyer has
received Seller's request for payment and the information required
pursuant to Appendix E hereof, Buyer shall make, or cause to be made,
the scheduled payment pursuant to the Payment/Termination Schedule, to
Seller, provided that Buyer may withhold all or part of any Payment for
the month in which the event occurs, to the extent of the occurrence of
any of the following events:
a. Seller's request for payment does not meet the requirements of
Appendix E hereof or the Monthly Progress Report for the month for
which the request for payment is made has not been submitted to
Buyer.
b. Seller has failed to pay any amounts due and payable to Buyer
under the Agreement.
7.9 Seller shall indemnify Buyer against any mechanics liens filed against
the Project Site by suppliers or subcontractors to Seller in the
performance of the Work hereunder and which allege non-payment by
Seller for such supplier or subcontractor work.
7.10 ******************************************************************
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7.11 Final Payment Subject to a Release of Liens: At the time of final
payment hereunder, Seller shall certify to Buyer that the Project to
the extent of the most recent payment received by Seller, are free
from, and that there are no known, or pending claims of, liens,
security interests (including without limitation mortgages, pledges) or
encumbrances of whatsoever nature referred to collectively as "Liens")
arising out of or in connection with performance by Seller, or any
Subcontractor, of the Work, or to the extent that any such Liens exist,
that a bond or corporate guaranty in an amount sufficient to discharge
any or all Liens against Seller in form, substance and amount
reasonably satisfactory to Buyer has been delivered by Seller.
7.12 Any provision hereof to the contrary notwithstanding, upon the
occurrence and continuance of a default by Seller as provided in
Section 31 and the cure period applicable hereto if any, shall have
expired, Buyer may withhold or retain such portion (including all) of
any payments due to Seller under this Agreement as reasonably necessary
to insure the performance of the Work or to protect fully Buyers rights
hereunder.
SECTION 8: TAXES
8.1 Seller Taxes:
The Contract Price shall not include and, Seller shall be responsible
for, and shall pay directly, any and all corporate and individual taxes
that are measured by net income or profit imposed by any governmental
authority of any country on Seller, its employees or Subcontractors due
to the execution of any agreement or the performance of or payment for
Work hereunder (the "Seller Taxes"). It is expressly understood by the
Parties that all export and import duties that may be applied to the
Turbine Generator Units and any Buyer taxes related to the manufacture
of the Turbine Generator Units outside of the United States of America
are the responsibility of the Seller.
8.2 Buyer Taxes:
Buyer shall be responsible for, and shall pay directly when due and
payable, any and all Buyer Taxes (defined below), and all payments due
and payable by Buyer to Seller hereunder shall be made, free and clear
of all deductions and withholding, for Buyer Taxes. If Seller is
required to pay Buyer Taxes, Buyer shall, promptly upon presentation of
Seller's invoice for such Buyer Taxes, pay to Seller an amount equal to
the Buyer Taxes or alternatively, Buyer shall provide Seller with a tax
exemption certificate acceptable to the taxing authorities.
"Buyer Taxes" means all taxes, fees, or other charges of any nature
(including, but not limited to, ad valorem, consumption, excise,
franchise, gross receipts, license, property, sales, stamp, storage,
transfer, turnover, use, or value-added taxes, and any and all items of
withholding, deficiency, penalty, addition to tax, interest, or
assessment related thereto), other than Seller Taxes, imposed by any
governmental authority of any country on the Project. Products exported
from the United States are presumed to be exempt from Buyer Taxes
levied within the United States. When requested by Seller, Buyer agrees
to furnish without charge evidence of tax or duty exemption acceptable
to the taxing or customs authorities.
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SECTION 9: PRICE ADJUSTMENTS
For shipments beyond the Guaranteed Shipment Dates due to delays caused by
events of Force Majeure, the Contract Price is subject to adjustment upward or
downward by adjustment of payments made after such date to reflect changes in
Bureau of Labor Statistics Indexes as follows: (a) 50% of the price shall be
adjusted by an amount equal to the percentage by which the "Labor Index" for the
month in which payment is made is greater or less than the "Base Labor Index";
(b) 50% of the price shall be adjusted by an amount equal to the percentage by
which the "Materials Index" for the month in which payment is made is greater or
less than the "Base Materials Index";
For the purpose of this provision, the following definitions apply: (a) The
Labor Index shall be that index identified as SIC 3511 (Turbine and Turbine
Generator Sets) determined and reported monthly by the Bureau of Labor
Statistics of the U.S. Department of Labor; (b) the Materials Index shall be
that index identified as PPI 10-17 (Steel Mill Products) determined and reported
monthly by the Bureau of Labor Statistics of the U.S. Department of Labor; and
(c) the Base Labor Index and Base Materials Index shall be determined by
averaging the applicable indices for the month of the firm price date with those
of the preceding and following month.
All such payments shall be adjusted on a day to day basis based upon the month
of revised shipment. For billing purposes each payment shall include a tentative
adjustment calculated in the manner prescribed above but based upon the
preliminary indices in the most recent U.S. Department of Labor Index and the
Materials Index at the time such payment is invoiced. Any further adjustment
which may be required shall be made at the time the final indices are first
published for the month of shipment. Should the bases for calculation of the
indices be modified, the index series in effect at the date of shipment shall be
used for final price adjustment. Should the indices be discontinued, substitute
indices shall be substituted by mutual agreement of the parties. The Base Labor
Index shall be determined to the nearest second decimal place. The Base
Materials Index shall be determined to the nearest first decimal place. In
either case, if the next succeeding place is five or more, the preceding decimal
place shall be raised to the next higher figure. Both labor and material
adjustment shall be calculated to the nearest one-tenth of one percent.
SECTION 10: INSPECTION AND FACTORY TESTS
Buyer's inspectors will be provided reasonable access to Seller's facilities for
purposes of obtaining information on production progress, determining status and
observing tests and inspections of the Turbine Generator Units. Such access will
be limited to areas concerned with the Turbine Generator Units and shall not
include restricted areas where work of a proprietary nature is being conducted.
Buyer will be advised as to the schedule for testing which the Parties have
mutually agreed upon. Buyer 's inspectors will be given an opportunity to
observe these tests during regular working hours. Neither completion of
production work nor shipment of any part of the Turbine Generator Units,
however, will be delayed to accommodate the inspectors. The inspectors will be
informed of Seller's methods of reporting production progress. Appropriate
office facilities will be provided where Buyer's inspectors may conduct their
work in connection with the above. Subject to the conditions set forth in this
Section 10, Seller shall obtain, where reasonably available, for Buyer access to
Subcontractors' plants for the purposes described above. Buyer's inspection of
the work or his failure to inspect in no way relieves Seller of its obligation
to fulfill the requirements of this Agreement nor is it to be construed as
acceptance by Buyer.
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SECTION 11: TITLE TRANSFER, RISK OF LOSS, SHIPMENT TO STORAGE
11.1 Passage of Title
Title to major components or materials of each Turbine Generator Unit
to be shipped from within the United States shall pass to Buyer when
made available for shipment from the Seller's or Seller's
Subcontractor's factory. Title to major components or materials to be
shipped from a country other than the United States shall pass to Buyer
at the port of export immediately after such components or materials
have been cleared for export. Title to installation services and other
work in progress conducted at the Project Site shall pass to Buyer as
such work is performed.
11.2 Risk of Loss
Notwithstanding passage of title, Seller shall remain responsible for
risk of loss or damage to the Turbine Generator Units and materials
incorporated therein until delivered to the Delivery Point.
11.3 Shipment to Storage
If any part of the Turbine Generator Units cannot be shipped to Buyer
by the Guaranteed Shipment Date due to any cause not attributable to
Seller, Seller may ship such parts to storage. If such parts are placed
in storage, including storage at the facility where manufactured, the
following conditions shall apply: (a) title shall thereupon pass to
Buyer if it had not already passed; (b) any amounts otherwise payable
to Seller upon shipment shall be payable upon presentation of Seller's
invoices and certification of cause for storage; (c) all direct
expenses incurred by Seller, such as for preparation for and placement
into storage, handling, inspection, preservation, insurance, storage,
removal charges and any taxes shall be payable by Buyer upon submission
of Seller's invoices; and (d) when conditions permit and upon payment
of all amounts due hereunder, Seller shall resume shipment of the
Turbine Generator Units to the Delivery Point.
SECTION 12: COMPLIANCE WITH APPLICABLE LAWS AND PERMITS
The Contract Price is based on Seller's design, manufacture and shipment of the
Turbine Generator Units and performance of the Work pursuant to Applicable Laws
and Permits in effect as of the date of this Agreement. The Contract Price will
be equitably adjusted to reflect additional costs incurred by Seller resulting
from a change in Applicable Laws and Permits after the execution date of this
Agreement which have a material effect on the Turbine Generator Units or the
Scope of Work. If Seller determines that a change is not possible, Seller will
so notify Buyer and Buyer may terminate this Agreement pursuant to Section 31.4,
"Termination for Convenience by Buyer" hereof or direct completion without
change and assume responsibility for obtaining any necessary waivers.
Notwithstanding the foregoing paragraphs, no modification in the Contract Price
will be made as a result of any general change in the manufacturing facilities
of Seller resulting from the imposition of any requirements by any Federal,
State or local governmental entity.
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In addition to the Codes listed in Appendix A, Seller supplied Equipment will be
designed and furnished in compliance with the following State of California Code
requirements:
* CBC - 98 or UBC - 97
* Earthquake Zone 4
* Soil Profile Type Sd
* Special Occupancy Structure
* Near Source Factor Na = 1.0
* Near Source Factor Nv = 1.0
* Wind Speed: 70 MPH
* Exposure Category C
Seller will submit Seller drawings, as reasonably required by the above stated
California Code, for review by the appropriate reviewing authority as part of
Seller's price. Should changes be required to bring Seller's Equipment into
compliance with codes or requirements other than those State of California Code
requirements stated above, such changes will be performed by Seller as a
Contract extra to Buyer's account, and will be effected via a mutually agreed to
change order in accordance with this Section and Section 14.
SECTION 13: EXPORT PROHIBITIONS
Buyer agrees not to re-export US origin goods supplied by Seller, other than in
and to the ultimate country of destination specified in Buyer's order and/or
declared as the country of ultimate destination on Seller's invoice, except as
may be permitted by the US export laws and regulations, as may be amended. Buyer
agrees that it will not re-export to the countries designated in Export
Administration Regulations Section 779.4(f), any technical data or software (nor
the direct product thereof) provided to Buyer by Seller in connection with this
Agreement, unless prior written authorization is obtained from the US Export
Administration.
Unless otherwise provided in Seller's proposal the Turbine Generator Units and
the Work sold hereunder are not intended for application (and shall not be used)
in connection with any nuclear installation or activity and Buyer warrants that
it shall not use the Turbine Generator Units and Services for such purposes, or
permit others to use or permit others to use the Turbine Generator Units for any
such purposes. If, in breach of the foregoing, any such use occurs, Seller shall
have no liability for any nuclear or other damage, injury or contamination, and
Buyer shall indemnify Seller, its affiliates and suppliers of every type and
tier against any such liability, whether arising as a result of breach of
Agreement, warranty, indemnity, tort (including negligence), strict liability or
otherwise. Notwithstanding, any other provisions herein, and to the extent
applicable, Seller shall be responsible for timely obtaining any required
authorization, such as an export license, import license, foreign exchange
permit, work permit or any other governmental authorization. Buyer and Seller
provide each other reasonable assistance in obtaining required authorizations.
Seller shall comply with all applicable state and federal laws, including but
not limited to, the Fair Labor Standards Act of 1938, as amended, the
Occupational Safety and Health Act of 1970 (OSHA), laws related to nonsegregated
facilities and equal employment opportunity (including the seven paragraphs
appearing in Sec. 202 of Executive Order 11246, as amended), and all standards,
rules, regulations, and orders issued pursuant to such state and federal laws.
15
SECTION 14: CHANGES
Buyer may, by written change order, make mutually agreed to changes in the
Turbine Generator Units and the Work. If any such change results in an increase
or decrease in the cost or time required for the performance of the Work under
this Agreement, there shall be an equitable adjustment in the Contract Price and
the Guaranteed Shipment Date. Seller shall not be obligated to proceed with the
changed or extra work until the price of such change and its effect on the
Guaranteed Shipment Date has been agreed upon in a written change order.
SECTION 15: NON-RECOURSE OBLIGATIONS
Except as may be otherwise agreed pursuant to Section 7.5 (particularly the
second sentence thereof), none of the affiliates, or members of Buyer, or their
respective officers, employees or agents shall be personally liable for payments
due under this Agreement or for the performance of any obligation hereunder, and
the sole recourse of Seller for the payment of amounts due from Buyer or for the
satisfaction of any other obligations of Buyer hereunder shall be against the
Buyer.
SECTION 16: MECHANICAL COMPLETION AND SUBSTANTIAL COMPLETION
16.1 Mechanical Completion
16.1.1 Mechanical Completion shall mean that all the following has
occurred: (i) each Turbine Generator Unit has been substantially
manufactured in accordance with the terms of the Agreement (with
the exception of curing the Punch List, completing the
Performance Tests and delivery of Final Drawings and
Documentation); (ii) Seller has provided to Buyer the Operating
Manual in accordance with Section 4 hereof, Seller has completed
the operator training and Buyer has provided and Seller has
accepted the Punch List, (iii) all pollution and emission control
systems for each Turbine Generator Unit are functional and
operating as provided for in this Agreement; (iv) each Turbine
Generator Unit is mechanically and electrically functional and
operating as intended per this Agreement; (v) all instrumentation
and control systems have been calibrated and are functional and
operating as intended per this Agreement; (vi) all applicable
Turbine Generator Unit systems shall have undergone functional
testing at full load, without leaks or equipment failures; and
(vii) Mechanical Completion has been acknowledged by Buyer. Buyer
shall give Seller at least 5 days notice before Buyer begins
mechanical completion tests.
16.1.2 Notice of Mechanical Completion
When Buyer believes that it has achieved Mechanical Completion
for any Turbine Generator Unit, it shall deliver to Seller notice
thereof (the "Notice of Mechanical Completion").
16.1.3 Achievement of Mechanical Completion
Within ten (10) Business Days following receipt of the Notice of
Mechanical Completion, (a) Seller shall acknowledge that
Mechanical Completion for any applicable Turbine Generator Unit
has been achieved if the requirements of Section 16.1 hereof have
been satisfied, or (b) notify Buyer in writing that Mechanical
Completion has not been achieved,
16
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
stating the reasons therefor. In the event that Seller determines
that Mechanical Completion has not been achieved, Buyer shall
promptly take such reasonable actions, including the performance
of additional work as will achieve Mechanical Completion and
shall issue to Seller another Notice of Mechanical Completion
pursuant to Section 16.1 hereof. Such procedure shall be repeated
as necessary until Mechanical Completion has been achieved. For
all purposes of this Agreement, the date of achievement of
Mechanical Completion shall be the date on which Seller receives
a Notice of Mechanical Completion relating thereto, with respect
to which Seller ultimately acknowledges that Mechanical
Completion has been achieved.
16.1.4 Substantial Completion
Substantial Completion shall mean that each of the Turbine
Generator Units has achieved Minimum Performance and has
successfully achieved the Reliability Guarantee (with the
exception of curing the Punch List and delivery of Final Drawings
and Documentation).
16.1.5 Delay in Achievement of Substantial Completion:
If, as a result of Seller's sole fault or negligence, Substantial
Completion for any Turbine generator Unit has not been achieved
within ninety (90) days of achievement of Mechanical Completion,
and Buyer has provided to Seller 60 days, during which the
balance of plant and auxiliaries are functional and operating for
the purpose of Seller's correction and or adjustment of the
deficientTurbine Generator Unit to meet Minimum Performance
("Substantial Completion Cure Period"), Seller hereby agrees to
pay to Buyer **********per day for each Turbine Generator Unit
which fails to achieve Substantial Completion as liquidated
damages, and not as a penalty ("Late Substantial Completion Delay
Payments") for each day beyond the Substantial Completion Cure
Period to the date Substantial Completion occurs. Buyer and
Seller hereby acknowledge and agree that the terms, conditions
and amounts fixed pursuant to the payment of liquidated damages
provided herein are reasonable and will not constitute a penalty,
considering the delay and the actual costs that Buyer will incur
due to any Turbine Generator Unit failing to achieve Substantial
Completion within the Substantial Completion Cure Period due to
the sole fault or negligence of Seller. The amount of liquidated
damages is agreed upon and fixed hereunder because of the
difficulty of ascertaining the exact amount of damages that would
actually be incurred by Buyer if Substantial Completion is not
achieved during the Substantial Completion Cure Period, and Buyer
and Seller agree that the liquidated damages specified herein
shall be applicable regardless of the amount of such damages
actually incurred by Buyer. Late Substantial Completion Delay
Payments shall be Seller's sole and exclusive liability for
delays in not achieving Substantial Completion within the time
period stated in this Section 16.1.5.
17
Sellers total liquidated damages for delays under this paragraph
16.1.5 and the following paragraph 17.2, in aggregate, shall not
exceed 15 % of the Contract Price.
16.1.6 Notice of Substantial Completion
When Seller believes that any Turbine Generator Unit has achieved
Substantial Completion, it shall deliver to Buyer a notice
thereof (the "Notice of Substantial Completion").
16.1.7 Achievement of Substantial Completion
Within ten (10) Business Days following receipt of the Notice of
Substantial Completion (including all the results of testing),
(a) Buyer shall acknowledge that Substantial Completion has been
achieved, if the requirements of Section 16.1.4 hereof have been
satisfied, or (b) if Buyer determines that Substantial completion
has not been achieved, Buyer shall notify Seller in writing that
Substantial Completion has not been achieved, stating the reasons
therefor. In such event, Seller shall promptly take such
reasonable actions, including the performance of additional Work
as will achieve Substantial Completion. Such procedure shall be
repeated as necessary until Substantial Completion has been
achieved. For all purposes of this Agreement, the date of
achievement of Substantial Completion shall be the date on which
Buyer receives a Notice of Substantial Completion relating
thereto, with respect to which Buyer ultimately acknowledges that
Substantial Completion has been achieved. In the event Buyer
fails to acknowledge, within twenty (20) Business Days after
Buyer's receipt of a Notice of Substantial Completion, that
Substantial Completion has been achieved, or has not been
achieved, as the case may be, Substantial Completion will be
deemed to have been achieved on the date upon which Seller's
Notice of Substantial Completion was received by Buyer.
SECTION 17: GUARANTEED SHIPMENT DATE; LIQUIDATED DAMAGES FOR LATE SHIPMENT
17.1 Seller shall ship the Turbine Generator Units and all major components
of the Turbine Generator Units (gas turbine, generator, and accessory
base module) no later than August 31, 2002, for the first two Turbine
Generator Units and September 30, 2002 for the second two Turbine
Generator Units (the "Guaranteed Shipment Dates"). In the event the
Turbine Generator Units are manufactured outside the United States of
America the Guaranteed Shipment dates shall be the dates the Turbine
Generator Unit are transported to the United States of America, cleared
for import into the United States of America by customs and ready for
inland transportation.
17.2 If the actual shipment dates are delayed beyond the Guaranteed Shipment
Dates due to causes other than delays caused by the Buyer or due to
events of Force Majeure, Seller shall pay Buyer as liquidated damages
per Turbine Generator Unit and not as a penalty, a sum in accordance
with the following schedule:
Days after the Guaranteed Shipment date:
18
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
Days 1 through 14 *********day for each delayed Turbine Generator Unit
Days 15 through 21 ********day for each delayed Turbine Generator Unit
Days 22 through 28 ********day for each delayed Turbine Generator Unit
Days 29 through 35 ********day for each delayed Turbine Generator Unit
Each day after day 36 ********day for each delayed Turbine Generator Unit
Hereafter, "Late Guaranteed Shipment Delay Payments".
Late Guaranteed Shipment Delay Payments shall apply until
shipment of the delayed Turbine Generator Unit is made. Late
Guaranteed Shipment Delay Payments shall be Seller's sole and
exclusive liability for delays in not shipping the Turbine
Generator Units by the Guaranteed Shipment Dates. Buyer and
Seller hereby acknowledge and agree that the terms, conditions
and amounts fixed pursuant to the payment of liquidated damages
provided herein are reasonable and will not constitute a penalty,
considering the delay and the actual costs that Buyer will incur
due to Seller's failure to ship the Turbine Generator Units by
the Guaranteed Shipment Dates. The amount of liquidated damages
is agreed upon and fixed hereunder because of the difficulty of
ascertaining the exact amount of damages that would actually be
incurred by Buyer due to Seller's failure to ship the Turbine
Generator Units by the Guaranteed Shipment Dates, and Buyer and
Seller agree that the liquidated damages specified herein shall
be applicable regardless of the amount of such damages actually
incurred by Buyer. Sellers total liquidated damages for delays
under this paragraph 17.2 and the preceding paragraph 16.1.5, in
aggregate, shall not exceed ****of the Contract Price.
SECTION 18: PERFORMANCE TESTS
18.1 When the Turbine Generator Units have achieved Mechanical Completion
and are capable of safe operation in accordance with Applicable Laws
and Permits, the Operating Manual and Applicable Codes and Standards,
Buyer shall perform the Performance Tests on each individual Turbine
Generator Unit, as specified in the Approved Test Procedures in
Appendix G. Buyer shall provide to Seller at least ten (10) days prior
written notice of the date on which Buyer intends to commence each of
the Performance Tests.
18.2 Buyer shall have the right to suspend or delay any Performance Test if
performance of such test would not be in compliance with Applicable
Laws and Permits, the Operating Manual, Applicable Codes and Standards.
18.3 All Performance Tests on each individual Turbine Generator Unit shall
be conducted and results calculated in accordance with Approved Test
Procedures for the Performance Tests, including any adjustments to
reflect deviations from Guarantee Conditions, to be calculated as set
forth in the Approved Test Procedures and verified by Parties. The
Performance Tests shall be based on the American Society of Mechanical
Engineer's Power Test Code 22, 1997, as amended by mutual consent of
the Parties. Seller's degradation curve attached hereto and made
19
a part hereof within Appendix A shall apply if the Performance Tests
are conducted or completed after 100 hours of fired operation of any
individual Turbine Generator Unit. Notwithstanding GEK-28106A VI.
Evaluation, located in Appendix A, Tab17, the performance tolerances of
a single unit station instrumentation test for measurement of the
Performance Guarantees shall be in general accordance with the American
Society of Mechanical Engineer's Power Test Code 22, 1997, as amended
by mutual consent of the Parties.
18.4 Seller may designate and make available qualified and authorized
representatives to observe the Performance Tests to monitor the taking
of measurements to determine the level of achievement of the
Performance Guarantees. Buyer shall keep Seller's representatives
continuously apprised of the specific schedule, and any changes
thereto, for the commencement, and any re-performances, of the
Performance Tests. Buyer shall provide to Seller a written report of
the results of each Performance Test that is conducted.
18.5 If testing demonstrates that any individual Turbine Generator Unit's
corrected performance levels (adjusted for actual operating conditions
in accordance with 19.1 and calculated measurement uncertainties in
accordance with 18.3) do not achieve the Performance Guarantees, Seller
shall submit to Buyer a written plan to achieve the Performance
Guarantees pursuant to Section 23.
SECTION 19: PERFORMANCE GUARANTEES
Subject to the provisions of this Agreement, Seller guarantees that the Turbine
Generator Units will achieve all of the Performance Guarantees in this Section
(the "Performance Guarantees") during one or more Performance Tests.
Performance Guarantees
--------------------------- ---------------------------------------------------
Guaranteed Heat Rate 9420 BTU/kWh (LHV)
at Guarantee Conditions****
--------------------------- ---------------------------------------------------
--------------------------- ---------------------------------------------------
Turbine Generator Units 162,300 kW at Guarantee Conditions****
Electrical Output
Guarantee*
--------------------------- ---------------------------------------------------
--------------------------- ---------------------------------------------------
Emissions NOx 9 ppmvd @ 15% O2
Guarantee
CO 9 ppmvd
UHC 7 ppmvw
PM- dry filterable (Front Half) 9 lb./hr**
Condensables (Back Half) 0.0 lb./hr***
VOC 1.4 lb./hr
--------------------------- ---------------------------------------------------
*As measured at the generator terminals
** Front Half particulates as measured by US EPA Method 5
20
*** Condensable (Back Half) particulates as measured by US EPA Method 8
(Sulfur Acid Mist) excluded ammonia salts.
****"Guarantee Conditions" means evaporative coolers off, ambient
temperature corrected to 59 degrees Fahrenheit, 14.19 psig barometric
pressure, relative humidity of 60%, elevation at 1105 feet, inlet
losses equal to 4 inches water and exhaust losses equal to 17 inches
water, generator power factor at .8 lagging, generator cold gas
temperature of 40 degrees C and generator H2 pressure of 30 psig with
fuel characteristics as follows:
Natural Gas Fuel: 21,490 Btu/lb. LHV @ 365 degrees F
NOx emissions are corrected to 15% O2 without heat rate correction and
are not corrected to ISO reference condition per 40CFR 60.335(c)(1).
NOx levels shown will be controlled by algorithms within the
SPEEDTRONIC control system.
19.2 Heat Rate Guarantee
Seller guarantees to Buyer, that during a continuous four (4) hour
Performance Test for the Operating Criteria, conducted in accordance
with the Approved Test Procedure, each individual Turbine Generator
Unit's heat rate will not exceed the Guaranteed Heat Rates specified in
Section 19.1, plus the allowance for test uncertainty in accordance
with Section 18.3 herein. Each thirty (30) minute interval within each
four (4) hour test period will be treated as an individual test point.
The Turbine Generator Unit's heat rate will be the average corrected
results from the eight (8) test points.
19.3 Turbine Generator Units Electrical Output Guarantee
Seller guarantees to Buyer that during a continuous four (4) hour
Performance Test for each the Operating Criteria, conducted in
accordance with the Approved Test Procedure, each individual Turbine
Generator Unit's electrical output will not be less than the Turbine
Generator Unit's Electrical Output Guarantee specified in Section 19.1,
less the allowance for test uncertainty in accordance with Section 18.3
herein. Each thirty (30) minute interval within each four (4) hour test
period will be treated as an individual test point. The Turbine
Generator Unit's electrical output will be the average corrected
results from the eight (8) test points.
19.4 Emissions Guarantee
19.4.1 Subject to the provisions of this Agreement, Seller guarantees to
Buyer that, for the Operating Criteria, during each of the six,
one hour Emission Tests, during an eight hour period throughout
which each individual Turbine Generator Unit is operating at a
net power output level within the range of fifty percent and one
hundred percent of the Turbine Generator Unit's Electrical Output
Guarantee, and in accordance with the Approved Test Procedures
and Section 19.4.2 below, each Turbine Generator Unit will meet
the Emissions Guarantee during each test period as specified in
Section 19.1 for the Operating Criterion.
19.4.2 Methods of Testing
21
Methods for emission testing will follow the test procedures
defined in "US Standard Field Testing Procedure for Emission
Compliance", GEK-28172F, located in Appendix A, Tab 17, subject
to the acceptance of the California Energy Commission and the
California Air Resources Board-South Coast Air Quality Management
District or their successors and assigns.
a. NOx: utilizing plant certified continuous emission
monitoring system, EPA Method 7E and 20
b. CO: EPA Method 10
c. PM: Front Half EPA Method 5, Back Half EPA Method 8
d. VOC: EPA Method 18, 25 and/or 25A
19.5 Reliability Guarantee
Seller guarantees to Buyer that each individual Turbine Generator Unit
will, during a single continuous 5-day Reliability Test in accordance
with the Approved Test Procedures:
a. each individual Turbine Generator Unit while combusting
Natural Gas Fuel operating at various loads, will ramp up and
ramp down and will continue to operate and will not trip;
b. Should the Reliability Test be interrupted for reasons not
solely attributable to the Turbine Generator Unit, the
Reliability Test will re-commence at the hour of the
interruption.
SECTION 20: ACHIEVEMENT OF PERFORMANCE GUARANTEES
20.1 When Buyer believes that any individual Turbine Generator Unit has
achieved successful completion of a Performance Test providing the
basis for achieving the Heat Rate Guarantee, Turbine Generator Unit
Electrical Output Guarantee, Emission Guarantee or Reliability
Guarantee, it shall deliver to Seller a notice thereof (the "Notice of
Performance Test Success").
In the event that Buyer determines that for any individual Turbine
Generator Unit the Heat Rate Guarantee, Electrical Output Guarantee,
Emission Guarantee or Reliability Guarantee have not been achieved,
Buyer shall give Seller written notice of such determination and Seller
shall promptly take such reasonable actions, including the performance
of additional work and the completion of additional Performance Tests
(all fuel and operational personnel needed for any and all retesting to
be supplied by Buyer), as may be necessary to achieve the Heat Rate
Guarantee, Turbine Generator Unit Electrical Output Guarantee, Emission
Guarantee or Reliability Guarantee for such deficient Turbine Generator
Unit, as the case may be. Such procedure shall be repeated as necessary
until the Heat Rate Guarantee, Turbine Generator Unit Electrical Output
Guarantee, Emission Guarantee and Reliability Guarantee for such
deficient Turbine generator Unit has been achieved. If Buyer determines
that the Performance Guarantees have been satisfied it shall give
written notice to Seller. In the event Buyer fails either to notify
Seller within thirty (30) Business Days that the Heat Rate Guarantee,
Turbine
22
Generator Unit Electrical Output Guarantee, Emission Guarantee or
Reliability Guarantee, as the case may be, or to notify Seller that
such Performance Guarantee has not been achieved, the Heat Rate
Guarantee, Turbine Generator Unit Electrical Output Guarantee, Emission
Guarantee or Reliability Guarantee, as the case may be, will be deemed
to have been achieved as of the date of completion of the Performance
Test.
20.2 The Heat Rate Guarantee, Turbine Generator Unit Electrical Output
Guarantee and Emission Guarantee, shall be considered to have been
achieved if Seller meets the requirements of Sections 19.2, 19.3 and
19.4 respectively, or Seller has achieved Minimum Performance and has
paid Liquidated Damages in accordance with Section 23 hereof.
SECTION 21: ACCEPTANCE
21.1 Acceptance shall have occurred if the following conditions have been
met:
(a) Seller has performed all of the Work required by this
Agreement in accordance with the Scope of Work, including any
items listed on the Punch List; and
(b) All portions of all of the Turbine Generator Units are capable
of being used in accordance with all Applicable Laws and
Permits, Good Electric Power Producing Practices, the
Operating Manual, Applicable Codes and Standards and, the
Agreement, and are free from Defects and Deficiencies and that
all systems are functioning as designed without contacts or
software inhibited or with jumpers in place; and
(c) All quality assurance documentation has been provided to Buyer
in accordance with the Seller's Quality Assurance Program and
Seller has otherwise complied with its Quality Assurance
Program; and
(d) Seller has conducted and completed the Personnel Training
Program and has delivered the Operating Manual; and
(e) Substantial Completion with respect to all four Turbine
generator Units has occurred; and
(f) Seller has delivered to Buyer its written certification that
the conditions for Acceptance set forth in clauses (a) through
(e) of this Section have been satisfied.
21.2 When Seller believes it has achieved Acceptance, it shall deliver to
Buyer a notice thereof (the "Notice of Acceptance"). Buyer shall,
within ten (10) Business Days following receipt of the Notice of
Acceptance, (a) inspect the Turbine Generator Units and all Work
hereunder and acknowledge that Acceptance has been achieved or (b)
notify Seller in writing that Acceptance has not been achieved, stating
the reasons therefor. In the event Buyer determines that Acceptance has
not been achieved, Seller shall promptly take such reasonable actions,
including the performance of additional Work as required herein and the
completion of additional Performance Tests, as will achieve Acceptance,
and shall issue to Buyer another Notice of Acceptance. Such procedure
shall be repeated as necessary until Acceptance has been achieved. In
the event Buyer fails to acknowledge, within
23
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
twenty (20) Business Days after Buyer's receipt of a Notice of
Acceptance, that Acceptance has been achieved, or has not been
achieved, as the case may be, Acceptance will be deemed to have been
achieved on the date upon which Seller's Notice of Acceptance was
received by Buyer.
SECTION 22: (INTENTIONALLY LEFT BLANK)
SECTION 23: PERFORMANCE GUARANTEE PAYMENTS AND REMEDIES
23.1 In the event that Substantial Completion has been achieved but the
Turbine Generator Unit Heat Rate Guarantee has not been achieved,
Seller shall be afforded a 180 days cure period, commencing at
Substantial Completion, during which xxxx Xxxxxx shall use reasonable
efforts to cure such shortfall. In the event that Seller is unable to
cure such shortfall in performance within said cure period, Seller
agrees to pay to Buyer as liquidated damages and not as a penalty for
the amount that the aggregate heat rates of all the Seller's supplied
Turbine Generator Units for the Project (sum of heat rates/number of
Units delivered to the Project) fails to meet the Turbine Generator
Unit Heat Rate Guarantee, an amount equal to ********for every Btu/kWh
(lower heating value) by which average heat rate exceeds the Heat Rate
Guarantee based on the average heat rates recorded during the heat rate
performance test, up to a maximum liquidated damages amount equal to
*******of the Contract Price.
23.2 In the event that Substantial Completion has been achieved but the
Turbine Generator Electrical Output Guarantee has not been achieved,
Seller shall be afforded a 180 days cure period, commencing at
Substantial Completion, during which xxxx Xxxxxx shall use reasonable
efforts to cure such shortfall. In the event that Seller is unable to
cure such shortfall in performance within said cure period, Seller
agrees to pay to Buyer, as liquidated damages and not as a penalty for
the amount that the aggregate electrical output of all the Seller's
supplied Turbine Generator Units for the Project (sum of electrical
outputs/number of Units delivered to the Project) fails to meet the
Turbine Generator Unit Electrical Output Guarantee, an amount equal to
$600 for every kW of electrical energy by which the aggregate net
electrical output of the Turbine Generator Units (in kW) falls below
the Turbine Generator Unit Electrical Output Guarantee based on the
average kW output of the Turbine Generator Units recorded during the
Electrical Output Performance Test, up to a maximum liquidated damages
amount equal to twenty percent (20%) of the Contract Price..
23.3 If due to the sole fault of Seller Substantial Completion is not
achieved within 180 days after Mechanical Completion (or such longer
period as may be mutually agreed between the Parties), Seller shall be
in default of this Agreement and Buyer may avail itself of all remedies
pursuant to Section 31 hereof.
23.4 The Performance Guarantee Payments specified in Sections 23.1 and 23.2
above, shall be calculated individually for each Turbine Generator Unit
for failure to achieve any Performance Guarantee and, shall be Seller's
sole and exclusive
24
liability for failure to achieve any Performance Guarantee, except as
provided in 16.1.5.
23.5 Notwithstanding anything else to the contrary in this Agreement, Seller
shall not be subject to Performance Guarantee damages under this
Agreement to the extent that the engineering, procurement and
construction contractor for the Project, (the "EPC Contractor") is not
liable to the Buyer for performance guarantee payments under the EPC
Contractor's agreement with Buyer.
23.6 Buyer and Seller hereby acknowledge and agree that the terms,
conditions and amounts fixed pursuant to the payment of the Performance
Guarantee Payments liquidated damages provided herein are reasonable
and will not constitute a penalty, considering the delay and the actual
costs that Buyer will incur due to the Turbine Generator Units failure
to achieve the Performance Guarantees. The amount of liquidated damages
is agreed upon and fixed hereunder because of the difficulty of
ascertaining the exact amount of damages that would actually be
incurred by Buyer if the Turbine Generator Units fail to achieve the
Performance Guarantees, and Buyer and Seller agree that the liquidated
damages specified herein shall be applicable regardless of the amount
of such damages actually incurred by Buyer. Payment of Performance
Guarantee Payments shall be Seller's sole and exclusive liability if
the Turbine Generator Units fail to achieve the Performance Guarantees.
SECTION 24: WARRANTIES
24.1 Seller warrants to Buyer that (i) the equipment to be delivered
hereunder shall be designed and fit for the purpose of generating
electric power when operated in accordance with Seller's operation
instructions and, in the absence thereof, in accordance with generally
accepted operation practices of the electric power producing industry
and shall be free from defects in material, workmanship and title; and
(ii) Technical Advisory Services (as specified in Appendix K) shall be
performed in a competent, diligent manner in accordance with any
mutually agreed specifications. The warranties and related remedies for
Personal Training Program as specified in Appendix B, if provided, are
exclusively set forth elsewhere in this Agreement. Seller shall warrant
the foregoing for the earlier of: (i) one year following achievement of
Minimum Performance, or (ii) two years following the completion of
shipment of the Turbine Generator Units (hereafter, the "Warranty
Period").
24.2 The foregoing warranties (except as to title) for each Unit shall apply
to defects which appear during the Warranty Period.
24.3 If the equipment delivered or Technical Advisory Services performed
hereunder do not meet the above warranties during the Warranty Period,
Buyer shall promptly notify Seller in writing and make the equipment
available promptly for correction. Seller shall thereupon correct any
defect by, at its option, (i) reperforming the defective Technical
Advisory Services, (ii) repairing or replacing the defective part or
equipment, as may be applicable (freight and insurance paid by Seller).
Seller shall provide all reasonably necessary labor, tools and services
for any such repair of the equipment, but Seller shall not be
responsible for removal or replacement of structures or other parts of
the facility. If a defect in the equipment or part thereof cannot be
corrected by Seller's reasonable efforts, the Parties will negotiate a
mutually agreeable equitable adjustment in Contract Price with respect
to such
25
equipment or part thereof. The condition of any tests shall be mutually
agreed upon and Seller shall be notified of and may be represented at,
all tests that may be made.
24.4 Any reperformed service or repaired or replacement part furnished under
this warranty shall carry warranties on the same terms as set forth
above, except that the warranty period shall be for a period of one
year from the date of such reperformance, repair or replacement. In any
event the warranty period and Seller's responsibilities set forth
herein for such repaired or replacement part shall terminate one year
after the end of the Warranty Period ("the Rewarranty Period")
applicable to the item of equipment in which such repaired or
replacement part was installed or in which such Service was
reperformed.
24.5 Seller does not warrant the Turbine Generator Units or any repaired or
replacement parts against normal wear and tear, including operation
beyond design capability, frequent starting, detrimental air inlet
conditions or erosion, corrosion or material deposit from fluids (all
as indicated in Seller's technical publication GEK 3620F, Heavy Duty
Gas Operating and Maintenance Considerations) and fuel not in
accordance with the fuel specification (attached as Appendix L). The
warranties and remedies set forth herein are further conditioned upon
(i) the proper storage, installation, operation, and maintenance of the
Turbine Generator Units and conformance with the Operation Manual
(including revisions thereto) provided by Seller and/or its
subcontractors, as applicable and (ii) repair of modification pursuant
to Seller's instructions or approval. Buyer shall keep proper records
of operation and maintenance during the Warranty Period. These records
shall be kept in the form of log sheets and copies shall be submitted
to Seller upon its request. Seller does not warrant any equipment or
services of others designated by Buyer where such equipment or services
are not supplied by Seller.
24.6 Except as otherwise specifically provided for in this Agreement the
preceding paragraphs of this Article 24 set forth the exclusive
remedies for all breach of Warranty, however instituted, whether based
on contract, indemnity, warranty, tort (including negligence), strict
liability or otherwise. The foregoing warranties are exclusive and are
in lieu of all other warranties and guarantees whether written, oral,
implied or statutory. NO IMPLIED STATUTORY WARRANTY OF MERCHANTABILITY
OR IMPLIED STATUTORY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE SHALL
APPLY.
SECTION 25: FORCE MAJEURE EVENT
25.1 A "Force Majeure Event" means any act, condition, or event that
prevents either Party to this Agreement from performing its obligations
under this Agreement, and such act, condition, or event could not have
been prevented by the exercise of due diligence of the Party asserting
the claim, was beyond the reasonable control of the Party or was not
reasonably foreseeable and occurred without the fault or negligence of
the Party asserting the claim. Seller or Buyer shall not have any
liability or be considered to be in breach or default of its
obligations under this Contract (other than Buyer for payment) to the
extent that performance of such obligations is delayed or prevented,
directly or indirectly, due to: (i) causes beyond its reasonable
control; or (ii) acts of God, act (or failures to act) of governmental
authorities, fires, severe weather conditions, earthquakes, strikes or
other labor disturbances, floods, war (declared or undeclared),
epidemics, civil unrest, riot, delays in transportation, or car
shortages; or (iii) acts (or omissions) of Buyer including failure to
promptly: (a) provide Seller with information and approvals necessary
to permit Seller to proceed with work immediately and without
26
interruption, (b) comply with the terms of payment, or (c) provide
Seller with such evidence as Seller may request that any export or
import license or permit has been issued (if such is the responsibility
of Buyer), or (iv) shipment to storage or (v) inability on account of
causes beyond the reasonable control of Seller to obtain necessary
materials, necessary components or services. Seller shall notify Buyer
of any such delay. The date of delivery or of performance shall be
extended for a period equal to the time lost by reason of delay, plus
such additional time as may be reasonably necessary to overcome the
effect of such excusable delay. Seller shall notify Buyer, as soon as
practicable, of the revised Shipment Date and Service resumption date.
If Seller is delayed by acts or omissions of Buyer, or by the
prerequisite work of Buyer's other contractors or suppliers, Seller
shall also be entitled to an equitable price adjustment.
If a delay excused by Force Majeure under this Article extends for more
than three hundred sixty-five (365) days and the parties have not
agreed upon a revised basis for continuing the Work at the end of the
delay, including adjustment of the price, then either party (except
where delay is caused by Buyer, in which event only Seller), upon
thirty (30) days written notice, may terminate this Agreement with
respect to the undelivered Turbine Generator Units to which title has
not yet passed and any uncompleted services, whereupon Buyer shall
promptly pay Seller its termination charges determined in accordance
Appendix D upon submission of Seller's invoices therefor.
25.2 In the event of a Force Majeure occurrence:
(a) the affected Party shall promptly give the other Party notice
describing the particulars of the occurrence, including an
estimation of its expected duration and probable impact on the
performance of such party's obligations hereunder, and continues
to furnish timely regular reports with respect thereto during the
continuation of the Force Majeure Event;
(b) the notice described in clause (a) above is given no later than
five (5) Business Days after the affected party becomes aware or
should, with due diligence, have become aware of the commencement
of any such delay due to the claimed Force Majeure Event;
(c) the extension of time of performance shall be of no greater scope
and of no longer duration than is reasonably required by the Force
Majeure Event.
(d) no liability of either Party which arose before the occurrence of
the Force Majeure Event causing the suspension of performance
shall be excused as a result of the occurrence;
(e) the affected Party exercises all reasonable efforts to mitigate or
limit damages to the other party and to resume its performance as
quickly as possible;
(f) the affected Party shall use all reasonable efforts to continue to
perform its obligations hereunder and to correct or cure the event
or condition excusing performance; and
(g) when the affected Party is able to resume performance of the
affected obligations under the Agreement, that Party shall give
the other party written notice to that effect, a Change Order
shall be executed by Buyer and Seller to adjust the Guaranteed
Shipment Date to account for the actual effect on the
27
affected party's performance of its obligations by the Force
Majeure Event, and the affected Party shall promptly resume
performance under the Agreement Documents
25.3 If Seller is delayed by acts or omissions of Buyer, or by the
prerequisite work of Buyer's other subcontractors or suppliers, Seller
shall be entitled to seek an equitable price adjustment in accordance
with Section 9 herein.
SECTION 26: INDEMNITIES
26.1 Seller Indemnities:
Seller shall indemnify, protect, save, hold harmless and defend Buyer,
the Financing Parties, each of their respective subsidiaries and
affiliates, and their directors, officers, agents, partners, employees,
and Buyer's subcontractors, successors and assigns of each of them (the
"Buyer Indemnified Parties") from and against any and all Damages
arising out of third-party claims for any damage to or destruction of
third-party property or death of or bodily injury to, any person, to
the extent caused by Seller's or Seller's Subcontractors' wrongful or
negligent acts or omissions, in the performance of Seller's obligations
hereunder. Seller's aforesaid indemnity is for the exclusive benefit of
the Buyer Indemnified Parties and in no event shall inure to the
benefit of any other party except for permitted assignees. "Third party
property" shall not include property of the foregoing Buyer Indemnified
Parties for purposes of this Section 26.1.
26.2 Buyer Indemnities:
Buyer shall indemnify, save harmless and defend Seller and its
Subcontractors and their affiliates and each of their directors,
officers, agents, employees, successors and assigns of each of them,
(the "Seller Indemnified Parties"), from and against any and all
Damages arising out of third-party claims associated with the
performance by Buyer or Buyer Indemnified Parties of its or their
obligations hereunder, including without limitation any damage to or
destruction of property of, or death of or bodily injury to, any
person, to the extent caused by Buyer's or Buyer Indemnified Party's
wrongful or negligent acts or omissions, in the performance of Buyer's
or Buyer Indemnified Party's obligations hereunder. Buyer's aforesaid
indemnity is for the exclusive benefit of the Seller Indemnified
Parties and in no event shall inure to the benefit of any other party
except for permitted assignees.
26.3 Tax Indemnification:
Seller shall indemnify, save harmless and defend the Buyer Indemnified
Parties from and against any and all Seller Taxes. Buyer shall
indemnify, save harmless and defend the Seller Indemnified Parties from
and against any and all Buyer Taxes.
26.4 Patent Indemnification:
Seller agrees to indemnify and hold harmless and defend the Buyer from
any claims, suits or proceedings of any third party that any Equipment
furnished hereunder infringes any patent of the United States
("Claim"). If Buyer notifies Seller promptly of the receipt of any
Claim, does not take any position adverse to Seller regarding such
Claim and gives Seller information, assistance and exclusive authority
to settle and defend the Claim, Seller shall, at its own expense and
option,
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CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
either (i) settle or defend the Claim and pay all damages and costs
awarded in it against Buyer, or (ii) procure for Buyer the right to
continue using the Equipment, or (iii) modify the Equipment so that it
becomes non-infringing, or (iv) replace the Equipment with
non-infringing Equipment. If, in any suit arising from such a Claim,
the continued use of the Equipment for the purpose intended is
forbidden by any court of competent jurisdiction, Seller shall at its
option take one or more of the actions under (ii), (iii) or (iv) above.
The foregoing states the entire liability of Seller for patent
infringement of any Equipment.
The foregoing shall not apply to any Equipment which is manufactured to
Buyer's design. As to any Equipment or use described in the preceding
sentence, Seller assumes no liability whatsoever for patent
infringement.
26.5 Notice and Legal Defenses:
Promptly after receipt by Buyer Indemnified Party or Seller Indemnified
Party of any claim or notice of the commencement of any action,
administrative or legal proceeding, or investigation as to which the
indemnity in favor of the Buyer Indemnified Parties or Seller
Indemnified Parties applies, the Buyer Indemnified Parties or Seller
Indemnified Parties, as the case may be, shall notify the indemnitor
thereof in writing. The indemnitor shall assume the defense thereof on
behalf of the Buyer Indemnified Parties or Seller Indemnified Parties,
as the case may be, and conduct such defense with due diligence and in
good faith with counsel reasonably satisfactory to the Buyer
Indemnified Parties or Seller Indemnified Parties, as applicable;
provided, however, that (a) the Buyer Indemnified Parties or Seller
Indemnified Parties, as the case may be, shall have the right to be
represented therein by advisory counsel of its own selection and at its
own expense.
26.6 Failure to Defend Action:
If any claim, action, proceeding or investigation arises as to which
the indemnity in favor of the Buyer Indemnified Parties or Seller
Indemnified Parties applies, and the indemnitor fails to assume the
defense of such claim, action, proceeding or investigation, then the
Buyer Indemnified Parties or Seller Indemnified Parties, as the case
may be, may at Seller's or Buyer's expense, as applicable, contest (or,
with the prior written consent of Seller or Buyer, as applicable,
settle) such claim.
26.7 Survival:
The provisions of this Section 26 shall survive Acceptance and the
termination of this Agreement.
SECTION 27: LIMITATIONS OF LIABILITIES
In no event shall the sum of Seller's liability to Buyer under this Agreement
for all Delay Payments and all Performance Guarantee Payments (excluding failure
to achieve the Emission Guarantee) exceed an amount equal to ***********of the
Contract Price. In no event shall the sum of Seller's liability to Buyer for any
claim arising from this Agreement whether based upon warranty, tort (including
negligence), strict liability, for defaults pursuant to Section 31, or otherwise
arising from Seller's performance or breach of this
29
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
Agreement exceed *********of the Contract Price. All liability under this
Contract shall terminate four years after the Shipment Date of the Turbine
Generator Unit giving rise to the claim, except for any liabilities or claims of
which Buyer has notified Seller within such four year period.
SECTION 28: CONSEQUENTIAL DAMAGES
28.1 It is understood and agreed by the Parties that liquidated damages
which may be payable by Seller, if applicable, under the specific
liquidated damages provisions elsewhere in this Agreement shall not be
considered consequential damages for purposes of this Section; and it
is further understood and agreed that, in no event, whether as a result
of breach of contract, warranty, indemnity, tort (including
negligence), strict liability, or otherwise, shall Seller or its
subcontractors or suppliers be liable for loss of profit or revenues,
loss of use of the equipment or any associated equipment, cost of
capital, cost of substitute equipment, (which does not include Seller's
liability, if any, pursuant to Section 31.2(c) hereof for equipment
which must be purchased by Buyer following Seller's default)
facilities, services or replacement power, downtime costs, claims of
Buyer's customers for such damages, or for any special, consequential,
incidental, indirect or exemplary damages and Buyer shall indemnify
Seller against such claims of Buyer's customers.
28.2 If Buyer cannot obtain for Seller from the subsequent purchasers the
protections specified in this Article 28, Buyer shall indemnify, defend
and hold Seller harmless from and against any and all claims made by
any subsequent purchasers of the Turbine Generator Units or services
against Seller for loss or damage arising out of the performance or
non-performance of the Equipment or Services provided under this
Contract.
28.3 If Seller furnishes Buyer with advice or assistance concerning any
products, systems or work which is not required pursuant to the Scope
of Work the furnishing of such advice or assistance will not subject
Seller to any liability, whether in contract, warranty, indemnity, tort
(including negligence), strict liability or otherwise.
28.4 For the purposes of this Article 28, the term "Seller" shall mean
Seller, its affiliates, subcontractors and suppliers of any tier, and
their respective agents and employees, whether individually or
collectively.
28.5 The provisions of this Article 28 shall prevail over any conflicting or
inconsistent provisions contained in any of the documents comprising
this Contract, except to the extent that such provisions further
restrict Seller's liability.
SECTION 29: SELLER PROVIDED INSURANCE
29.1 From a period commencing 15 months prior to the Guaranteed Shipment
Date, Seller shall provide and maintain the following insurance with
the indicated limits, with insurance carriers rated not less than "A"
by Best, or equivalent (with the
30
exception of Worker's Compensation insurance), and in a form reasonably
satisfactory to Buyer and, unless indicated to the contrary below,
shall maintain such insurance in full force and effect until
Acceptance; provided, however, that Seller shall provide the liability
insurance coverage required under this Section 29 and workers'
compensation coverage for all periods during which Seller or any of its
agents or employees enters onto the Project Site; and provided,
further, that such liability insurance coverage and workers'
compensation coverage shall continue in full force and effect during
the Warranty Period. Such liability insurance shall include the
contractual liability assumed under the Section 26 (Indemnity Clause)
of this Agreement, covering claims for bodily injury (including death)
or third party property damage that may arise from operations performed
under this Agreement, whether such operations be by Seller or by any
Subcontractor of any tier or their respective agents or employees:
(i) Workers' compensation insurance in compliance with any
applicable federal law; with statutory limits in compliance
with the workers' compensation laws applicable in the state in
which the Work is being performed. Coverage will include a
Broad Form All States Endorsement.
(ii) Employers' liability insurance with a limit of $5,000,000 per
accident and $5,000,000 annual aggregate, $5,000,000 disease
per employee and $5,000,000 disease policy limit.
(iii) Automobile liability insurance including, but not limited to,
coverage for owned, non-owned and hired, leased or rented
motor vehicles, licensed or unlicensed with a $5,000,000
combined single limit per accident.
(iv) Comprehensive or commercial general liability insurance
written on an occurrence basis with a combined single limit of
liability for bodily injury, including death, personal injury
and property damage of $5,000,000 per occurrence and
$10,000,000 in the aggregate. Such coverage shall include
premises/operations, broad form property damage, blanket
contractual liability, independent Sellers, products/completed
operations liability, and personal injury.
(v) Excess liability insurance in connection with the employers'
liability coverage, the automobile liability coverage, the
comprehensive or commercial general liability coverage, and
with a combined single limit of $10,000,000 per occurrence and
$10,000,000 annual aggregate. Such insurance shall drop down
to provide primary coverage in the event the underlying policy
aggregate is exhausted by payment of claims. Any combination
of primary and excess limits is acceptable to the extent it
complies with the total limits.
29.2 Certificates: Seller shall furnish to Buyer certificates of insurance
required hereunder in the applicable forms set forth hereto. All such
certificates shall state that ninety (90) days' prior written notice
shall be given to each such party in the event of cancellation or
non-renewal of or material change in the relevant policy.
29.3 Waivers of Subrogation: All insurance policies supplied by Seller
(except those relating to workers' compensation insurance) shall
include a waiver of any right of subrogation of the insurers thereunder
against Buyer, the Financing Parties, and the Independent Engineer.
31
29.4 Failure to Procure Insurance: If Seller fails to procure and maintain
the required insurance, or any portion thereof, the Buyer shall have
the right, but not the obligation, to procure and maintain the required
insurance for and in the name of Seller, and Seller shall promptly pay
the cost thereof and shall furnish all information necessary to acquire
and maintain such insurance. Neither party shall violate or knowingly
permit any violation of any condition or term of the policies of
insurance carried hereunder.
29.5 Additional Insureds, etc.: All liability insurance policies furnished
by Seller shall name Buyer as additional insureds.
29.6 No Limitation of Liability: The required coverage's referred to and set
forth in this Section 29 shall in no way affect, nor are they intended
as a limitation of, Seller's liability with respect to its performance
of the Work.
29.7 Insurance Primary: All policies of insurance provided by Seller
pursuant to this Section 29 shall be written as primary policies, not
contributing with, and not in excess of, the coverage that Buyer, and
the Financing Parties, and their respective permitted assigns,
successors, parent companies, subsidiaries and affiliates may carry
against the same hazards.
SECTION 30: BUYER-PROVIDED INSURANCE
Buyer shall provide and maintain the following insurance with the indicated
limits and, unless indicated to the contrary below, shall maintain such
insurance in full force and effect from six months prior to the Guaranteed
Shipment Date until Acceptance:
(i) Workers' Compensation insurance written in compliance with any
applicable federal law; with statutory limits in compliance
with workers' compensation laws applicable in the state in
which the Work is being performed. Coverage will include broad
form All States endorsement.
(ii) Employers' liability insurance with a limit of $1,000,000 per
accident and $1,000,000 annual aggregate, $1,000,000 disease
per employee and $1,000,000 disease policy limit.
(iii)Comprehensive or commercial general liability insurance
written on an occurrence basis with a combined single limit of
liability for bodily injury, including death, personal injury
and property damage of $1,000,000 per occurrence. Such
coverage shall include premises/operations, explosion,
blasting (if any), excavation, collapse and underground
hazards, broad form property damage, blanket contractual
liability, independent Sellers, products/completed operations
liability, and personal injury. If the policy is written on a
commercial general liability form, the general aggregate and
products/completed operations aggregate shall be no less than
$1,000,000, respectively.
(iv) Automobile liability insurance, including, but not limited to,
coverage for all owned, non-owned, hired, leased or rented
motor vehicles, licensed or unlicensed. Such insurance shall
provide coverage having a combined single limit per accident
of $1,000,000.
(v) Excess liability coverage in connection with the employers'
liability coverage, the automobile liability coverage and the
commercial general
32
liability coverage, with a combined single limit of $4,000,000
per occurrence and in the aggregate.
(vi) Builders risk insurance policy covering the full value of the
Work.
Seller shall be added as an additional insured, with waiver of
subrogation, as Seller's interests may appear, under all of
the above policies except workers compensation.
SECTION 31: TERMINATION
31.1 Default by Seller
Seller shall be in default of this Agreement if: (i) Seller fails to
perform any of its material obligations under this Agreement or fails
to comply with the material terms of this Agreement, unless the remedy
for the breach of any such obligation is payment of Delay Payments or
Performance Guarantee Payments, and Seller does not diligently commence
to cure such default within thirty (30) days after written Notice of
Default from Buyer, and the default is not cured within 90 days, except
for the cure periods in Section 23 or such longer period as may be
determined by the Buyer, and; (ii) Seller intentionally or negligently
disregards Applicable Laws and Permits which are applicable to the
performance of Seller's Work and such failure continues for thirty (30)
days after written Notice of Default from Buyer; (iii) Seller abandons
the Work or suspends its efforts to complete the Work (except when
permitted pursuant to this Agreement); (iv) Seller makes a general
assignment for the benefit of its creditors, is generally unable to pay
its debts as they become due, or becomes the subject of any voluntary
or involuntary bankruptcy, insolvency, arrangement, reorganization or
other debtor relief proceeding, and, in the case of any such
involuntary proceeding, such proceeding is not dismissed or stayed
within forty-five (45) days after it is commenced.
31.2 If Seller is in default under the foregoing Section 31.1 and does not
cure within the applicable cure periods pursuant to Section 31.1 Buyer
shall have any or all of the following rights and remedies:
(a) Buyer, without prejudice to any of its other rights and
remedies under this Agreement, and at Buyer's option,
may terminate this Agreement immediately by shipment to
Seller of a notice of termination (a "Termination for
Cause"), in which event Seller shall be relieved from
any obligation to complete any unfinished portion of the
Work, but shall not be relieved from its liabilities,
warranties or obligations otherwise provided for
hereunder in respect of any portion of the Work for
which the Seller has been paid hereunder. If Buyer
elects not to terminate, Buyer shall retain all rights
under applicable law for the purpose of enforcing its
rights specified under this Agreement;
(b) Any amounts owed by Buyer to Seller as of the date of
the Termination for Cause shall be retained by Buyer
until after completion of the Work and applied by Buyer
to pay any amounts owed by Seller pursuant to this
Section;
(c) Seller shall be liable to Buyer for any additional cost
in addition to the Contract Price hereunder incurred by
Buyer in the purchase of
33
equipment or services corresponding to the Work
terminated pursuant to a Termination for Cause
hereunder.
31.3 Default by Buyer:
Buyer shall be in default of this Agreement if (a) Buyer fails to pay
to Seller any required payment which is not in dispute and such failure
continues for thirty (30) days after written Notice of Default has been
given by Seller to Buyer or (b) as a result of the occurrence of a
Force Majeure Event, Work has been suspended for three hundred sixty
five (365) days or longer, then Seller may terminate this Agreement
upon written notice to Buyer. Seller will not be obligated to ship the
Turbine Generator Units or pass title to Buyer unless all payments from
Buyer to Seller are current.
31.4 Termination For Convenience by Buyer
Buyer may terminate this Agreement by five (5) days written notice to
Seller if Buyer determines in its sole discretion to be necessary or
convenient ("Termination For Convenience"). In the event Buyer
terminates this Agreement for convenience, Buyer shall pay Seller the
termination amount determined using the Payment/Termination Schedule
(Appendix D) through the date of termination; however, Buyer shall not
be obligated to make any other payments due after the date of
termination. Payments made against the Contract Price shall be credited
against the termination payment. For termination prior to title
transfer, title to the Turbine Generator Units shall remain with
Seller. Upon payment of the termination amount, neither Buyer nor
Seller shall have any further obligations to the other.
31.5 Surviving Obligations
Termination of this Agreement for Cause (a) shall not relieve Seller or
Buyer of any obligation hereunder that expressly survives termination
hereof; (b) except as otherwise provided in any provision of this
Agreement expressly limiting the liability of either Party, termination
shall not relieve either Buyer or Seller of any contractual obligations
or liabilities hereunder for loss or damage to the other Party arising
out of or caused by acts or omissions of such Party prior to the
effectiveness of such termination or arising out of such
termination;(c) shall not relieve Seller of its warranty or other
contractual obligations as to portions of the Work hereunder already
performed or relieve either party of continuing obligations of Seller
or Buyer, as the case may be arising prior to the date of termination,
and (d) Seller shall be liable for Delay Payments or Performance
Guarantee Payments for which liability has arisen prior to such
Termination for Cause.
SECTION 32: ASSIGNMENTS
32.1 Buyer subject to Sellers approval, which will not be unreasonably
withheld, may assign its rights interests and obligations, in whole or
in part, under this agreement and this Agreement to an affiliated
company, in which Buyer owns an equity interest of 50% or more,
provided it gives written notice to Seller. Seller may assign its
rights and obligations regarding the Work, in part or in whole, to one
or more of its wholly owned subsidiaries provided that it gives written
notice to Buyer setting forth the effective date of such assignment.
Upon the effective date of said assignment all of the rights and
obligations of Seller under this Agreement shall vest solely in
Seller's respective subsidiaries. Buyer agrees to execute such
documents as may be necessary to effect the assignment. SELLER REMAINS
LIABLE AS A
34
GUARANTOR UNDER THIS AGREEMENT AND HEREBY GUARANTEES THE PERFORMANCE OF
ITS SUBSIDIARIES AFTER THE ASSIGNMENT TAKES EFFECT. Buyer may assign
this Agreement to the EPC Contractor who will provide engineering
procurement and construction services to Buyer with respect to the
Project, subject to Buyer demonstrating to Seller pursuant to Section
7.5 that the EPC Contractor has the financial ability to pay Seller
hereunder.
32.2 Except as provided in the preceding paragraph, it is expressly
understood and agreed that this Agreement is personal to Seller and
Buyer, and that Seller and Buyer shall have no right, power or
authority to assign or delegate this Agreement or any portion hereof,
either voluntarily or involuntarily, or by operation of law. Any
assignment by Buyer shall not release Buyer from any of its obligations
hereunder. Notwithstanding the foregoing, Seller hereby consents to the
collateral assignment of the Buyers rights under this Agreement by
Buyer to the Financing Parties and agrees to provide such
acknowledgments and consents in respect of such collateral assignment
as the Financing Parties or their counsel may from time to time
reasonably require. In the event of such collateral assignment, Seller
hereby consents to the exercise of the Financing Parties' rights under
such collateral assignment. Upon request of Buyer or any permitted
assignee, Seller will further evidence its consent by execution of an
assignment or other instrument reasonably acceptable to Seller and the
permitted assignee.
32.3 Successors and Assigns
All of the rights, benefits, duties, liabilities and obligations of the
Parties hereto shall inure to the benefit of and be binding upon their
respective successors and permitted assigns.
SECTION 33: PERFORMANCE IN FAVOR OF FINANCING PARTIES
Seller agrees that in the event of a default by Buyer under the terms and
conditions of any agreement between Buyer and any Financing Party, the Financing
Parties shall be entitled to use and enforce this Agreement, as the same may be
amended or supplemented before or after such default, all without additional
cost to the Financing Parties. In the event any Financing Party notifies Seller
in writing that Buyer has defaulted under any agreement between Buyer and the
Financing Parties and requests Seller to continue performance under this
Agreement, Seller shall thereafter perform hereunder in accordance with the
terms and provisions hereof, so long as Seller shall be paid in accordance with
this Agreement for the Work performed hereunder, including payment of any sums
due to Seller for Work performed to and including the date of Buyer's default,
and so long as such Financing Parties agree in writing to continue to pay Seller
for Work performed in accordance with this Agreement.
Seller agrees to amend this Agreement as may be reasonably requested by the
Financing Parties to the extent that Seller's rights and or obligations
thereunder are not materially adversely affected.
SECTION 34: BUYER REVIEW OF DOCUMENTS
34.1 Buyer Review
Neither (a) the review by Buyer of any information or calculations
supplied by
35
Seller nor (b) Buyer's certification of the Heat Rate Guarantee,
Turbine Generator Unit Electrical Output Guarantee, Emission Guarantee,
Reliability Guarantee or Acceptance nor (c) Buyer's payments of the
Contract Price constitute a waiver of, or release Seller from, any
liability hereunder from any breach or default by Seller under this
Agreement. Notwithstanding anything to the contrary herein contained,
Buyer shall not be liable for and makes no representation with respect
to any designs and specifications for the Turbine Generator Units or
the Scope of Work, including any designs and specifications prepared by
Seller and reviewed or accepted by Buyer, and including any designs and
specifications set forth in the Agreement. Buyer's Acceptance of the
Turbine Generator Units shall not relieve Seller of its obligation for
such compliance.
34.2 Final Drawings and Documentation
One hundred-twenty (120) days after Mechanical Completion, Seller shall
furnish to Buyer CAD disks where reasonably available and reproducible
mylars of the Final Drawings and Documentation. Without limiting the
requirements otherwise applicable to the Final Drawings and
Documentation hereunder, the Final Drawings and Documentation shall
completely and accurately, in all material respects, show and describe
all piping and instrumentation, electrical interconnections, electrical
elementarys and control loop logic diagrams within the Turbine
Generator Units. Seller shall incorporate into the Final Drawings and
Documentation all material changes or corrections to the Turbine
generator Unit made at the Project Site prior to Acceptance so as to
represent the completed as-built Turbine Generator Units completely and
accurately in all material respects. Seller shall establish such
systems and retain such personnel as are necessary to maintain full
quality control and quality assurance with respect to the Final
Drawings and Documentation.
34.3 Ownership
Seller agrees that all documents prepared by Seller and provided to
Buyer pursuant to this Agreement shall be the property of Buyer.
SECTION 35: WAIVERS
No failure to exercise, and no delay in exercising, any right, power or remedy
under the Agreement shall impair any right, power or remedy that any Party
hereto may have, nor shall such failure or delay be construed to be a waiver of
any such rights, powers or remedies or an acquiescence in any breach or default
under the Agreement, nor shall any waiver of any breach or default be deemed a
waiver of any default or breach subsequently occurring under the Agreement. This
Agreement may not be changed or amended orally and any waiver hereof must be in
writing and executed by both Parties. Either Party's waiver of any breach or
failure to enforce any of the terms, covenants, conditions, or other provisions
of this Agreement at any time shall in no way affect, limit, modify, or waive
that Party's right thereafter to enforce or compel strict compliance with every
term, covenant, condition or other provision, notwithstanding any course of
dealing, course of performance, or custom of the trade.
SECTION 36: GOVERNING LAW
This agreement and the rights and duties of the parties hereunder and/or arising
from or relating in any way to the transactions evidenced by the agreement shall
be governed by and
36
construed in accordance with the laws of the state of New York, including all
matters of interpretation, validity and performance.
SECTION 37: SEVERABILITY
In the event that any of the provisions, or portions or applications thereof, or
of any of the Agreement are held to be unenforceable or invalid by any
arbitrator, arbitration panel, court, or regulatory agency of competent
jurisdiction, the validity and enforceability of the remaining provisions, or
portions or applications hereof, shall not be affected thereby.
SECTION 38: NOTICES
38.1 Unless otherwise expressly required or permitted by the Agreement, any
notice required or permitted to be given by Seller to Buyer hereunder
shall be in writing and shall be addressed to Buyer at:
Mountainview Power Company
00000 Xxx Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxxx, XX 00000
Attention: Xxxxx Xxxx, General Manager
Telephone: (000) 000-0000 Facsimile: (000) 000-0000
With a copy to:
Mountainview Power Company
000 Xxxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxxxx, Corporate Counsel
Telephone: (000) 000-0000 Facsimile: (000) 000-0000
and any notice required or permitted to be given by Buyer to Seller hereunder
shall be in writing and shall be addressed to Seller at:
GENERAL ELECTRIC COMPANY
0 Xxxxx Xxxx
Xxxxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx Such
Telephone: (000) 000-0000 Facsimile: (000) 000-0000
38.2 Delivery
Unless otherwise expressly required or permitted by the Agreement, all
notices shall be by writing and delivered (a) in person to the party
above mentioned, (b) via certified mail with a return receipt requested
in a securely sealed envelope and postage prepaid, (c) by expedited
delivery service with signed proof of delivery by company recipient, or
(d) by prepaid telegram or facsimile. A notice shall be deemed
delivered either at the time of personal delivery or, in the case of
delivery service or mail, as the date of delivery at the address
provided herein, or in the case of telegram, or facsimile, upon
receipt. Each Party, by notice to the other Party,
37
may designate, from time to time, another address or office to which
notices may be given pursuant to this Agreement.
SECTION 39: HEADINGS AND INTERPRETATION RULES
The Section and Section headings herein have been inserted for convenience of
reference only and shall not in any manner affect the construction; meaning or
effect of the provisions herein contained nor govern the rights and liabilities
of the parties hereto. Where the context requires, words importing the singular
include the plural and vice versa. Words importing natural persons or Parties
shall include firms and corporations and any other organizations having legal
capacity.
SECTION 40: ENTIRE AGREEMENT
This Agreement together with attachments (Appendices A - M) constitutes the
entire agreement of the Parties with respect to the subject matter hereof. All
prior, correspondence, negotiations and agreements, oral or written, among the
Parties with respect to the subject matter hereof are superseded by this
Agreement. The following Sections shall survive the termination of this
Agreement:
* Section 8 (Taxes)
* Section 24 (Warranties)
* Section 26 ( Indemnities)
* Section 27 (Limitation of Liabilities)
* Section 40 (Entire Agreement)
* Section 41 ( Seller's Proprietary Information)
* Appendix I (Confidentiality Agreement)
SECTION 41: SELLER'S PROPRIETARY INFORMATION
At the time of furnishing confidential or proprietary information, Seller will
expressly designate by label, stamp, or other written communication that the
information or documentation furnished is confidential. Buyer agrees (i) to
treat such information as confidential, (ii) to restrict the use of such
information to matters relating to Seller's performance of the Agreement, and
(iii) to restrict access to such information to employees of Buyer and its
agents whose access is necessary in the implementation of the Agreement.
Confidential information will not be reproduced without Seller's prior written
consent, and all copies of written information will be returned to Seller upon
request except to the extent that such information is to be retained by Buyer
pursuant to the Agreement. The foregoing restrictions do not apply to
information which: (i) is contained in a printed publication which was released
to the public by Seller prior to the date of the Agreement; or (ii) is, or
becomes, publicly known otherwise than through a wrongful act of Buyer, its
employees, or agents; or (iii) is in possession of Buyer, its employees, or
agents prior to receipt from Seller, provided that the person or persons
providing the same have not had access to the information from Seller; (iv) or
is furnished to others by Seller without restrictions similar to those herein on
the right of the receiving party to use or disclose; or (v) is approved in
writing by Seller for disclosure by Buyer, its agents or employees to a third
party.
SECTION 42: PUBLICITY RELEASES; INFORMATION
Seller shall not, and shall not permit any Subcontractor to, issue any press or
publicity release or any advertisement, or publish, release or disclose any
photograph concerning this Agreement or the Turbine Generator Units except in
accordance with the Confidentiality Agreement attached as Appendix I or with the
consent of the Buyer, such consent not to be
38
unreasonably withheld. Seller may list Buyer's name, project name, and a brief
project description in Seller's experience lists, which are periodically
developed and published. Seller shall give prior notice to Buyer of any
information contained in documents filed with public authorities or any other
public disclosure that could result in the dissemination of confidential
information; provided, however, that disclosures made pursuant to any federal or
state securities laws of the United States of America or regulations or pursuant
to the rules of any securities exchange may be made without the consent of
Buyer.
SECTION 43:NON-NUCLEAR USE.
The equipment furnished hereunder this Agreement shall not be used in
conjunction with the use or handling of nuclear material or the construction or
operation of a nuclear installation. Buyer warrants that it shall not use the
equipment for such purpose or permit others to use the equipment for such
purposes. If any such use does occur, Seller disclaims all liability for any
nuclear or other damage, injury or contamination or destruction of the equipment
and Buyer shall indemnify Seller against any such liability howsoever arising.
IN WITNESS WHEREOF, the Parties have caused this AGREEMENT to be executed by
this respective authorized representatives as of the date first set forth above.
GENERAL ELECTRIC COMPANY MOUNTAINVIEW POWER COMPANY
By: _________________________ By: ___________________________
Name: _______________________ Name: _________________________
Title: ________________________ Title: ________________________
39
APPENDIX A
SCOPE OF WORK
GE Xxxxxxxx # 00000XX dated September 1999 definesSellers scope of supply.
It is expressly understood that the steam turbine generator equipment and
accessories listed in the GE Proposal are not included in the contract price or
scope of supply and are provided as an option that the Buyer and Seller may
mutually agree to execute.
Tab 2, Tab 4, Tab 11, Tab 12, Tab 13, Tab 14, Tab 15, and Tab 18: References to
the Steam Turbine Generator equipment, services and accessories shall be
disregarded for the purposes of this Agreement
Tab 5, Tab 6 and Tab 8 shall be disregarded for the purposes of this Agreement
Tab 1 Revision 0
Tab 2 Revision 2
Tab 3 Revision 2
Tab 4 Revision 1
Tab 5 Revision 0
Tab 6 Revision 0
Tab 7 Revision 2
Tab 8 Revision 0
Tab 9 Revision 0
Tab 10 Revision 0
Tab 11 Revision 0
Tab 12 Revision 0
Tab 13 Revision 0
Tab 14 Revision 0
Tab 15 Revision 0
Tab 16 Revision 0
Tab 17 Revision 0
Tab 18 Revision 0
00
XXXXXXXX X
PERSONNEL TRAINING PROGRAM
Please refer to Appendix A, Tab 13
41
APPENDIX C
QUALITY ASSURANCE PROGRAM
Please refer to Appendix A Tab 16
42
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
Appendix D
Payment/Termination Schedule
4 x PG7241(FA) GTG Sets
Payment - Termination Schedule
Payment Termination
Payment Monthly Cumulative Cumulative
Month Event % of Contract % of Contract % of Contract
----- ----- ------------- ------------- -------------
Oct-99 Signed Agreement * * *
Nov-99
Dec-99
Jan-00
Feb-00
Mar-00
Apr-00
May-00
Jun-00 Progress Payment * * *
Jul-00
Aug-00
Sep-00
Oct-00
Nov-00
Dec-00
Jan-01
Feb-01
Mar-01 Progress Payment * * *
Apr-01 Progress Payment * * *
May-01 Progress Payment * * *
Jun-01 Progress Payment * * *
Jul-01 Progress Payment * * *
Aug-01 Progress Payment * * *
Sep-01 Progress Payment * * *
43
Oct-01 Progress Payment * * *
Nov-01 Progress Payment * * *
Dec-01 Progress Payment * * *
Jan-02 Progress Payment * * *
Feb-02 Progress Payment * * *
Mar-02 Progress Payment * * *
Apr-02 Progress Payment * * *
May-02 Progress Payment * * *
Jun-02 Progress Payment * * *
Jul-02 Progress Payment * * *
Aug-02 Ship 2 x GTG * * *
Sep-02 Ship 2 x GTG * * *
Oct-02 30 Days After Shipment of All Major Components * * *
Notes: The notes below are more precisely set forth in the Agreement
The initial payment is due within 5 business days of signed
Agreement and is non-refundable. Progress Payments are due on the
15th of the indicated month and will be billed 30 days in advance.
Payments tied to shipment are due Net 30 days after certification
that equipment has shipped.
The Buyer may terminate this contract at any time upon written
notice and payment of termination charges in accordance with the
schedule set forth above.
Upon termination prior to title transfer, title to terminated gas
turbine-generator equipment and accessories remains with the Seller.
The termination charge for any equipment for which title has
transferred is 100%.
44
APPENDIX E
SAMPLE GE MONTHLY PROGRESS REPORT
00
XXXXXXXX X
Schedule 1
FINAL LIEN WAIVER FORM
State of _ _____________
County of __ _________________________
KNOW ALL MEN BY THESE PRESENTS THAT General Electric Company, a corporation of
the State of New York, acting through its Power System business, whose address
is Xxx Xxxxx Xxxx, Xxxxxxxxxxx, Xxx Xxxx 00000, hereinafter called SUPPLIER, and
with regard to the (unit type) at (Project/site name), for and in consideration
of payment in the amount of______________ for invoice number ____ __________ to
be made by (Customer Name). (CONTRACTOR) upon execution of this Final Release,
hereby represents that all bills for labor, subcontractors, materials, lands,
licenses, and other expenses relating to this invoice have been paid by
SUPPLIER. Upon receipt by the undersigned of a check from the CONTRACTOR in the
above amount, payable to the undersigned, and when the check has been paid, this
document shall become effective to release and forever discharge the CONTRACTOR
and the OWNER from any and all claims, liens, and claims of lien arising out of
the materials and services for which payment is being made. Before any recipient
of this document relies upon it, he should verify evidence of payment to the
SUPPLIER. Supplier hereby covenants and agrees, for itself, its successors and
assigns, that it and they, and each of them, shall and will defend and save
harmless the Owner from and against any and all suits, actions, claims, liens or
demands of laborers, mechanics, materialmen or others, with regard to the
invoice to be paid in exchange for this Release of Lien.
--------------------------------------------------------------------------------
IN WITNESS WHEREOF, I have hereunder set my hand in behalf of the Supplier
______ ______________ day of _ ______, 19______ at _________ ________
______________ ______________________ (City)__________ (State) (Zip Code)
(Supplier)
By ________________________________
Title _ _
--------------------------------------------------------------
ACKNOWLEDGMENT
State of ____ ________________________
County of __ ___________________________ ss:
On this __________________________ day of _____ __________________,
19
46
before me appeared ____ _______________________________________, to me
personally known, who, being by me duly sworn, did depose and say that (he)
(she) (they) executed the above release for the Supplier and that (he) (she)
(they) was duly authorized to do so.
IN WITNESS WHEREOF, I have set hereunto my signature and seal this __________day
of _____ __________________, 19____.
---------------------------
(Notary Public)
My commission expires
--------------------------
47
APPENDIX F
INTENTIONALLY OMITTED
48
APPENDIX G
I. APPROVED TEST PROCEDURES
Please refer to Appendix A Tab 3 and Tab 17.
49
APPENDIX I
CONFIDENTIALITY AGREEMENT
THIS CONFIDENTIALITYAGREEMENT IS MADE AND EFFECTIVE THIS 13TH DAY OF AUGUST
1999") , BY AND AMONG GENERAL ELECTRIC COMPANY, ACTING THROUGH ITS GE POWER
SYSTEMS BUSINESS, A NEW YORK CORPORATION, HAVING A PRINCIPAL PLACE OF BUSINESS
AT 0 XXXXX XXXX, XXXXXXXXXXX, XXX XXXX 00000 XXX ("GE" OR "SELLER")
ANDMOUNTAINVIEW POWER COMPANY, A DELAWARE CORPORATION, HAVING A PRINCIPAL PLACE
OF BUSINESS AT 000 XXXXXX XX, XXXXX 000, XXXXXXX, XX 00000 ("BUYER") (SELLER AND
BUYER BEING REFERRED TO HEREIN INDIVIDUALLY AS A "PARTY" AND COLLECTIVELY AS THE
"PARTIES").
WHEREAS, each Party may provide to the other Party confidential information (the
"Confidential Information"), as defined below; and
WHEREAS, each Party receiving such Confidential Information agrees to keep such
information confidential pursuant to the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the premises and for other good and
sufficient consideration the Parties hereby agree as follows:
1. Neither party will disclose any of the Confidential Information to any
third party; provided, however, the Confidential Information may be
disclosed to each Party's employees and representatives who need to know
such information for the purpose of prosecuting the Work and who agree to
keep such information confidential to the same extent as if they were
parties hereto. The Parties shall label all Confidential Information as
"Confidential", "Proprietary" or similar designation. Oral information
which is confidential or proprietary so stated at the time of disclosure
shall be reduced to writing by the disclosing party within ten (10) working
days after disclosure, which writing shall specifically reference the date
of disclosure. A party (the "parent party") may disclose Confidential
Information of the other party (the "other party") for the purposes
contemplated herein; provided that such subsidiary or affiliate agrees in
writing to be bound by the terms of this Agreement prior to receipt of the
Confidential Information of the other party. In such event, the parent
party shall notify the other party of the disclosure of the Confidential
Information and provide the other party with a copy of such written
agreement executed by the subsidiary or affiliate of the parent party.
50
2. Confidential Information shall not include any information which (i) is or
becomes generally available to the public other than as a result of a
breach of this Agreement by either Party, (ii) becomes available to either
Party on a non-confidential basis from a source other than the other Party,
its representatives or agents, provided that such source is not in breach
of any secrecy or confidentiality obligation to either Party, (iii) is
known to either Party prior to receiving the Confidential Information, or
(iv) is independently developed by either Party.
3. In the event that either Party becomes legally compelled by a court or
administrative agency order or by subpoena to disclose any of the
Confidential Information, such Party will provide the other Party with
prompt notice of the order or subpoena before such Confidential Information
is disclosed. In the event that such Party is required to disclose the
Confidential Information, the disclosing Party will furnish only that
portion of the Confidential Information which it is legally required to
disclose and will reasonably assist the other Party in obtaining a
protective order or other assurance that confidential treatment will be
accorded to the Confidential Information that is so disclosed.
4. Neither Party makes any representation or warranty as to the completeness
or accuracy of the information to be provided hereunder.
5. Except as expressly provided herein with respect to the confidentiality and
non-disclosure of the Confidential Information, nothing in this Agreement
shall obligate any Party in any manner whatsoever with respect to
consummate or agree to any other transaction between the Parties.
6. This Agreement shall not be construed to grant to either Party any patent,
license, know-how, license, trade secret or any other rights, or to use any
related licenses or patent, trade secret or know how, which are owned by
either Party or its affiliates.
7. Without prejudice to the rights and remedies otherwise available, either
Party shall be entitled to seek equitable relief by way of injunction or
otherwise if the receiving Party or any of its representative's breach this
Agreement.
8. Neither Party will use or disclose any Confidential Information provided by
the other Party for any purpose other than with working with such party on
the prosecution of the Work and, provided further, neither Party shall use
or provide to any third party any Confidential Information provided by the
other Party in connection with any competing project.
51
9. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York.
10. This Agreement contains the full and complete understanding of the Parties
with respect to the subject matter hereof and supersedes all prior
representations and understandings whether oral or written. This Agreement
may not be modified in any manner except by written amendment executed by
both Parties.
11. This Agreement shall expire three years from the date hereof.
IN WITNESS WHEREOF, the Parties have executed this Agreement by their duly
authorized officers in duplicate counterparts, each of which shall be considered
an original.
Mountainview Power Company
By: _________________________
Name:_______________________
Title:_________________________
General Electric Company
By: _________________________
Name:_______________________
Title:_________________________
52
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
APPENDIX J
--------------------- ----------------------
*****************************************************
53
APPENDIX K
TECHNICAL ADVISORY SERVICES
Please refer to Appendix A Tab 12
54
APPENDIX L
FUELS SPECIFICATION
Please refer to Appendix A Tab 3, Tab 9 and Tab 17.
55
CONFIDENTIAL MATERIAL OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.
APPENDIX M
**************************************************
Buyer shall notify Seller of all Options Buyer wishes to include or delete 24
months prior to the Guaranteed Shipment Date. The Contract Price may be
subsequently modified through changes to the Scope of Work pursuant to Section
14 hereof. The Contract Price set forth above includes freight and delivery to
the Delivery Point.
Note 1
Packaged Electronic and Electrical Control
Compartment
(PEECC)
The PEECC is a completely enclosed compartment
suitable for outdoor installation. Heating, air
conditioning, compartment lighting, power
outlets, temperature alarms, and smoke detectors
are provided for convenience and protection of
the equipment in the PEECC.
Electrical monitoring and control of the unit are
accomplished by the turbine control panel and the
generator control panel, which are mounted on a
common skid and located in the PEECC. The
customer control local interface (I) is also
located in the PEECC. In addition to the control
systems, the PEECC also houses the gas turbine
motor control centers and batteries, rack and
charger (s). The arrangement of the equipment is
shown in the typical compartment layout below.
[chart depicting a Packaged Electronic and
Electrical Control Compartment]
56
