Exhibit 10.2

FOIA CONFIDENTIAL TREATMENT REQUESTED

PORTIONS OF THE EXHIBITS HERETO MARKED BY *** HAVE BEEN

OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT

FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

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Execution Version

LUMP SUM TURNKEY AGREEMENT

for the

ENGINEERING, PROCUREMENT AND CONSTRUCTION

of the

MARSH LANDING GENERATING STATION

by and between

MIRANT MARSH LANDING, LLC

as Owner

and

KIEWIT POWER CONSTRUCTORS CO.

as Contractor

Dated as of the 6th Day of May, 2010

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TABLE OF CONTENTS

 

RECITALS

   1 ARTICLE 1   

DEFINITIONS

   1 ARTICLE 2   

RELATIONSHIP OF OWNER, CONTRACTOR AND SUBCONTRACTORS

   14

2.1

  

Status of Contractor

   14

2.2

  

Key Personnel, Organization Chart and Contractor Representative

   15

2.3

  

Subcontractors and Sub-subcontractors

   15

2.4

  

Subcontracts and Sub-subcontracts

   16

2.5

  

Contractor Acknowledgements

   17 ARTICLE 3   

CONTRACTOR’S RESPONSIBILITIES

   19

3.1

  

Scope of Work

   19

3.2

  

Specific Obligations

   20

3.3

  

Design and Engineering Work

   21

3.4

  

Spare Parts

   23

3.5

  

Training Program in General

   24

3.6

  

Environmental Regulations and Environmental Compliance

   25

3.7

  

Contractor’s Tools and Equipment

   25

3.8

  

Employment of Personnel

   25

3.9

  

Clean-up

   27

3.10

  

Safety and Security

   27

3.11

  

Emergencies

   28

3.12

  

Approvals, Certificates, Permits and Licenses

   28

3.13

  

Books, Records and Audits

   28

3.14

  

Tax Accounting

   29

3.15

  

Temporary Utilities, Roads, Facilities and Storage

   29

3.16

  

Subordination of Liens

   29

3.17

  

Hazardous Materials

   30

3.18

  

Quality Assurance

   30

3.19

  

Reports and Meetings

   30

3.20

  

Payment

   32

3.21

  

Commercial Activities

   32

3.22

  

Title to Materials Found

   32

3.23

  

Survey Control Points and Layout

   32

3.24

  

Cooperation with Others

   32

3.25

  

Responsibility for Property

   33

3.26

  

Explosives

   33

3.27

  

Nondiscrimination

   34

3.28

  

Used or Salvaged Materials

   34

3.29

  

Supervision of Owner’s Operation Personnel

   34

3.30

  

Compliance with Real Property Interests

   34

3.31

  

Compliance with Site Rules

   34

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ARTICLE 4   

OWNER’S RESPONSIBILITIES

   35

4.1

  

Payment

   35

4.2

  

Permits

   35

4.3

  

Site Access

   35

4.4

  

Operation Personnel

   35

4.5

  

Taxes

   36

4.6

  

Legal Description and Survey

   36

4.7

  

Fuel and Power

   36

4.8

  

Utility and Interconnection Studies

   36 ARTICLE 5   

COMMENCEMENT OF WORK, KEY MILESTONE SCHEDULE, AND SCHEDULING OBLIGATIONS

   36

5.1

  

Commencement of Work

   36

5.2

  

Limited Notice to Proceed/Notice to Proceed

   36

5.3

  

Key Milestone Schedule, Guaranteed Substantial Completion Date and Required
Final Completion Date

   38

5.4

  

CPM Schedule

   39

5.5

  

Recovery and Recovery Schedule

   41

5.6

  

Acceleration and Acceleration Schedule

   42 ARTICLE 6   

CHANGES; FORCE MAJEURE; AND OWNER-CAUSED DELAY

   43

6.1

  

Change Orders Requested by Owner

   43

6.2

  

Change Orders Requested by Contractor

   44

6.3

  

Contract Price Adjustment; Contractor Documentation

   47

6.4

  

Change Orders Act as Accord and Satisfaction

   48

6.5

  

Timing Requirements for Notifications and Change Order Requests by Contractor

   48

6.6

  

Adjustment Only Through Change Order

   50

6.7

  

Force Majeure

   50

6.8

  

Delay Caused by Owner or Changes in Scope of Work

   50

6.9

  

Schedule Extension

   51

6.10

  

Delay

   51

6.11

  

Contractor Obligation to Mitigate Delay

   51 ARTICLE 7   

CONTRACT PRICE AND PAYMENTS TO CONTRACTOR

   51

7.1

  

Contract Price

   51

7.2

  

Interim Payments

   52

7.3

  

Final Completion and Final Payment

   54

7.4

  

Payments Not Acceptance of Work

   54

7.5

  

Payments Withheld

   54

7.6

  

Substitution for Retainage; Release of Retainage

   55

7.7

  

Interest on Late Payments

   56

7.8

  

Payments During Default

   56

7.9

  

Offset

   56

7.10

  

Currency

   56

 

ii

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ARTICLE 8   

TAXES

   56 ARTICLE 9   

TITLE AND RISK OF LOSS

   57

9.1

  

Title

   57

9.2

  

Risk of Loss

   58 ARTICLE 10   

INSURANCE AND PERFORMANCE SECURITY

   58

10.1

  

Insurance

   58

10.2

  

Contractor Letter of Credit

   58

10.3

  

Contractor’s Parent Guarantee

   58

10.4

  

Owner’s Letter of Credit

   58

10.5

  

Owner’s Parent Guarantee

   58 ARTICLE 11   

OWNERSHIP OF DOCUMENTATION

   59

11.1

  

Ownership of Work Product

   59

11.2

  

Computer Programs

   59

11.3

  

Owner Provided Documents

   60 ARTICLE 12   

COMPLETION AND PERFORMANCE LIQUIDATED DAMAGES

   60

12.1

  

Notice and Requirements for Pre-Commissioning and Mechanical Completion

   60

12.2

  

Notice and Requirements for Substantial Completion

   61

12.3

  

Owner Acceptance of Mechanical Completion and Substantial Completion

   61

12.4

  

Minimum Acceptance Criteria as a Condition of Substantial Completion

   61

12.5

  

Punchlist

   63

12.6

  

Notice and Requirements for Final Completion

   64

12.7

  

Performance Guarantees as a Condition of Final Completion

   64

12.8

  

***

   65

12.9

  

Partial Occupancy and Use

   65

12.10

  

Long-Term Obligations

   66 ARTICLE 13   

WARRANTY AND CORRECTION OF WORK

   66

13.1

  

Warranty

   66

13.2

  

Inspection

   67

13.3

  

Correction of Work After Substantial Completion

   68

13.4

  

Exclusivity

   69

13.5

  

Assignability of Warranties

   69 ARTICLE 14   

SUBSTANTIAL COMPLETION DELAY LIQUIDATED DAMAGES AND PAYMENT OF LIQUIDATED
DAMAGES

   69

14.1

  

Delay in Substantial Completion

   69

14.2

  

Suspension or Cessation of Substantial Completion Delay Liquidated Damages

   69

14.3

  

Payment of Liquidated Damages

   70 ARTICLE 15   

CONTRACTOR’S REPRESENTATIONS

   70

15.1

  

Corporate Standing

   70

 

iii

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15.2

  

No Violation of Law; Litigation

   70

15.3

  

Licenses

   70

15.4

  

No Breach

   70

15.5

  

Corporate Action

   71

15.6

  

Financial Solvency

   71 ARTICLE 16   

OWNER’S REPRESENTATIONS

   71

16.1

  

Corporate Standing

   71

16.2

  

No Violation of Law; Litigation

   71

16.3

  

Licenses

   71

16.4

  

No Breach

   71

16.5

  

Corporate Action

   72 ARTICLE 17   

DEFAULT, TERMINATION AND SUSPENSION

   72

17.1

  

Default by Contractor

   72

17.2

  

Termination for Convenience by Owner

   74

17.3

  

Suspension of Work

   76

17.4

  

Suspension by Contractor

   76

17.5

  

Termination by Contractor

   76

17.6

  

Termination in the Event of Extended Force Majeure

   77 ARTICLE 18   

INDEMNITIES

   77

18.1

  

General Indemnification

   77

18.2

  

Owner Indemnification

   78

18.3

  

Patent and Copyright Indemnification

   78

18.4

  

Lien Indemnification

   79

18.5

  

Legal Defense

   80

18.6

  

Enforceability

   80 ARTICLE 19   

DISPUTE RESOLUTION

   81

19.1

  

Negotiation - Parties’ Representatives

   81

19.2

  

Negotiation - Senior Executives

   81

19.3

  

Litigation

   81

19.4

  

Continuation of Work During Dispute

   82 ARTICLE 20   

CONFIDENTIALITY

   82

20.1

  

Contractor’s Obligations

   82

20.2

  

Owner’s Obligations

   82

20.3

  

Definitions

   83

20.4

  

Exceptions

   83

20.5

  

Equitable Relief

   83

20.6

  

Term

   83

20.7

  

Siemens Confidential Information

   83 ARTICLE 21   

LIMITATION OF LIABILITY

   84

21.1

  

Contractor Aggregate Liability

   84

21.2

  

Limitation on Contractor’s Liability for Liquidated Damages

   84

 

iv

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21.3

  

Liquidated Damages In General

   84

21.4

  

Consequential Damages

   85

ARTICLE 22

  

MISCELLANEOUS PROVISIONS

   85

22.1

  

Entire Agreement

   85

22.2

  

Amendments

   85

22.3

  

Joint Effort

   85

22.4

  

Captions

   85

22.5

  

Notice

   86

22.6

  

Severability

   86

22.7

  

Assignment of the Agreement

   87

22.8

  

Assignment of the Siemens Contract

   87

22.9

  

No Waiver

   88

22.10

  

Governing Law

   88

22.11

  

Foreign Corrupt Practice Act

   88

22.12

  

Successors and Assigns

   88

22.13

  

Attachments and Schedules

   88

22.14

  

Obligations

   88

22.15

  

Further Assurances

   88

22.16

  

Priority

   88

22.17

  

Restrictions on Public Announcements

   89

22.18

  

Language

   89

22.19

  

Counterparts

   89

22.20

  

Owner’s Lender

   89

22.21

  

Survival

   90

 

v

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LIST OF ATTACHMENTS AND SCHEDULES

 

ATTACHMENT A    Scope of Work and Design Basis

SCHEDULE A-1

  

Scope of Work

SCHEDULE A-2

  

Design, Engineering and Codes

SCHEDULE A-3

  

Engineered Equipment List

SCHEDULE A-4

  

Utility Interface Schedule

SCHEDULE A-5

  

Engineering Drawings

SCHEDULE A-6

  

Grading and Drainage Drawing

ATTACHMENT B    Contractor Deliverables

SCHEDULE B-1

  

Outline of Owner Document Submittal Requirements for Review or Information

SCHEDULE B-2

  

Outline of Minimum Vendor Document Requirements by Equipment Category

ATTACHMENT C    Payment Schedule

SCHEDULE C-1

  

EPC Payment Milestones

SCHEDULE C-2

  

Siemens Equipment Payment Milestones

SCHEDULE C-3

  

Maximum Cumulative Payment Schedule

ATTACHMENT D    Form of Change Order

SCHEDULE D-1

  

Change Order Form

SCHEDULE D-2

  

Owner-Directed Change Order Form

SCHEDULE D-3

  

Contractor’s Change Order Request Form

SCHEDULE D-4

  

Pricing for Change Orders

ATTACHMENT E    Key Milestone Schedule ATTACHMENT F    Key Personnel and
Contractor’s Organization ATTACHMENT G    Approved Subcontractors and
Sub-subcontractors

 

vi

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ATTACHMENT H    Notice to Proceed Forms

SCHEDULE H-1

  

Form of Limited Notice to Proceed

SCHEDULE H-2

  

Form of Notice to Proceed

ATTACHMENT I    Form of Contractor’s Invoices

SCHEDULE I-1

  

Form of Contractor’s Interim Invoice

SCHEDULE I-2

  

Form of Contractor’s Final Invoice

ATTACHMENT J    Health, Safety and Environmental Policies ATTACHMENT K    Form
of Lien and Claim Waivers

SCHEDULE K-1

  

Contractor’s Interim Waiver and Release of Liens

SCHEDULE K-2

  

Contractor’s Interim Claim Waiver

SCHEDULE K-3

  

Subcontractor’s Interim Waiver and Release of Liens

SCHEDULE K-4

  

Subcontractor Interim Claim Waiver

SCHEDULE K-5

  

Contractor’s Final Waiver and Release of Liens

SCHEDULE K-6

  

Contractor’s Final Claim Waiver

SCHEDULE K-7

  

Subcontractor’s Final Waiver and Release of Liens

SCHEDULE K-8

  

Subcontractor’s Final Claim Waiver

ATTACHMENT L    Form of Mechanical Completion Certificate ATTACHMENT M    Form
of Substantial Completion Certificate ATTACHMENT N    Form of Final Completion
Certificate ATTACHMENT O    Insurance Requirements ATTACHMENT P    Contractor
Permits ATTACHMENT Q    Owner Permits ATTACHMENT R    Form of Irrevocable
Standby Letters of Credit

SCHEDULE R-1

  

Form of Contractor Letter of Credit

SCHEDULE R-2

  

Form of Owner Letter of Credit

 

vii

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ATTACHMENT S    Performance Tests ATTACHMENT T    Performance Guarantees,
Performance Liquidated Damages, *** and Minimum Acceptance Criteria ATTACHMENT U
   Critical Path Method Schedule Requirements ATTACHMENT V    Pre-Commissioning,
Commissioning, Start-Up and Training Program ATTACHMENT W    Spare Parts List
ATTACHMENT X    Reporting Requirements

ATTACHMENT Y

  

Site

SCHEDULE Y-1

  

Description of the Site

SCHEDULE Y-2

  

Site and Surrounding Areas

SCHEDULE Y-3

  

Parcel Map

ATTACHMENT Z

  

Parent Guarantees

SCHEDULE Z-1

  

Form of Contractor’s Parent Guarantee

SCHEDULE Z-2

  

Form of Owner’s Parent Guarantee

ATTACHMENT AA    Demolition Work and Demolition Information ATTACHMENT BB   
Confidentiality Obligations for Siemens Confidential Information ATTACHMENT CC
   Ground Water Specifications

 

viii

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ENGINEERING, PROCUREMENT AND CONSTRUCTION AGREEMENT

THIS ENGINEERING, PROCUREMENT AND CONSTRUCTION AGREEMENT (this “Agreement”),
dated as of the 6th Day of May, 2010 (the “Effective Date”), is entered into by
and between Mirant Marsh Landing, LLC, a Delaware limited liability company
(“Owner”), and Kiewit Power Constructors Co., a Delaware corporation
(“Contractor” and, together with Owner, each a “Party” and together the
“Parties”).

RECITALS

WHEREAS, Owner desires to enter into an agreement with Contractor to provide the
engineering, procurement and construction of a natural gas-fired turbine
generator facility to be owned by Owner, located near Antioch, California, and
all related appurtenances thereto (as more fully described below, the
“Facility”), and to pre-commission, commission, start-up, and test the Facility,
all as further described herein; and

WHEREAS, Contractor, itself or through its vendors, suppliers, and
subcontractors, desires to provide the foregoing engineering, procurement,
construction, pre-commissioning, commissioning, start-up and testing services on
a turnkey lump sum basis;

NOW THEREFORE, in consideration of the mutual covenants herein contained and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Parties agree as follows:

ARTICLE 1

DEFINITIONS

1.1 In addition to other defined terms used throughout this Agreement, when used
herein, the following capitalized terms have the meanings specified in this
Section 1.1.

“Acceleration Schedule” has the meaning set forth in Section 5.6.

“Affiliate” shall mean, with respect to either Party, any entity that, directly
or indirectly through one or more intermediaries, controls, is controlled by, or
is under common control with such party. The term “control” means the
possession, directly or indirectly, of the power to cause the direction of the
management of such entity, whether through ownership of securities, by contract
or otherwise.

“Agreement” means this Agreement for the performance of the Work (including all
Attachments and Schedules attached hereto), as it may be amended from time to
time in accordance with this Agreement.

“Applicable Codes and Standards” means any and all codes, standards or
requirements set forth in Attachments A, J and S or in any Applicable Law, which
codes, standards and requirements shall govern Contractor’s performance of the
Work, as provided herein. In the event of an inconsistency or conflict between
any of the Applicable Codes and

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Standards, the highest performance standard as contemplated therein shall govern
Contractor’s performance under this Agreement.

“Applicable Law” means all laws, statutes, ordinances, certifications, orders,
decrees, injunctions, licenses, Permits, approvals, agreements, rules and
regulations, including any conditions thereto, of any Governmental
Instrumentality having jurisdiction over any Party, all or any portion of the
Site or the Facility or performance of all or any portion of the Work or the
operation of the Facility, or other legislative or administrative action of a
Governmental Instrumentality, or a final decree, judgment or order of a court
which relates to the performance of Work hereunder or the interpretation or
application of this Agreement, including (i) any and all Permits, (ii) any
Applicable Codes and Standards set forth in Applicable Law, and (iii) Applicable
Law related to (y) conservation, improvement, protection, pollution,
contamination or remediation of the environment or (z) Hazardous Materials or
any handling, storage, release or other disposition of Hazardous Materials.

“Auxiliary Power Load” has the meaning set forth in Attachment S.

“Books and Records” has the meaning set forth in Section 3.13A.

“Business Day” means every Day other than (i) a Saturday, (ii) a Sunday or
(iii) a Day that is an official holiday for employees of the federal government
of the United States of America or for employees of banks located in New York or
California.

“CAD” has the meaning set forth in Section 3.3E.

“California Revenue Taxes” has the meaning set forth in Section 8.2.

“CAISO” means the California Independent Systems Operator.

“Change Order” means a written order issued by Owner to Contractor after the
execution of this Agreement, in the form of Schedule D-2, or a written
instrument signed by both Parties after the execution of this Agreement in the
form of Schedule D-1, that authorizes an addition to, deletion from, suspension
of, or any other modification or adjustment to the requirements of this
Agreement, including an addition to, deletion from or suspension of the Work or
any modification or adjustment to any Changed Criteria. Owner and Contractor are
entitled to a Change Order in accordance with Article 6.

“Changed Criteria” has the meaning set forth in Section 6.1A.

“Changes in Law” means any amendment, modification, superseding act, deletion,
addition or change in or to Applicable Law affecting the Work to be performed in
California (excluding changes to Tax laws where such Taxes are based upon
Contractor’s revenue (except as set forth in Section 8.2), income,
profits/losses or cost of finance or withholding Tax) that occurs and takes
effect after the Effective Date.

“Computer Programs” shall mean those “Computer Programs” (as defined in the
Siemens Contract) that are provided by Siemens under the Siemens Contract.

 

2

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“Confidential Information” has the meaning set forth in Section 20.3.

“Contract Price” has the meaning set forth in Section 7.1.

“Contractor” has the meaning set forth in the preamble hereto.

“Contractor Group” means (i) Contractor, its parents and Affiliates, and
(ii) the directors, officers, employees, agents, attorneys and other
professional advisors of any Persons specified in clause (i) above.

“Contractor Letter of Credit” has the meaning set forth in Section 10.2.

“Contractor Representative” means that Person or Persons designated by
Contractor in a written notice to Owner and acceptable to Owner, who shall have
complete authority to act on behalf of Contractor on all matters pertaining to
this Agreement or the Work, including giving instructions and making changes in
the Work.

“Contractor’s Confidential Information” has the meaning set forth in
Section 20.2.

“Contractor’s Intellectual Property” has the meaning set forth in Section 11.1.

“Corrective Work” has the meaning set forth in Section 13.3.

“CPM Performance Measurement Baseline Schedule” has the meaning set forth in
Section 5.4B.

“Critical Spare Parts” means the Owner-requested operating spare parts to be
provided by Contractor in accordance with Sections 3.4 and 12.4C for (i) the gas
turbine and turbine generator, (ii) the selective catalytic reduction system,
(iii) the water treatment system and (iv) the continuous emissions monitoring
system.

“Day” means a calendar day.

“Default” has the meaning set forth in Section 17.1A.

“Defect” or “Defective” has the meaning set forth in Section 13.1A.

“Defect Correction Period” shall mean ***.

“Demobilization and Subcontract Cancellation Cost” has the meaning set forth in
Section 17.2A.

“Demolition LNTP” has the meaning set forth in Section 5.2D.

“Design Basis” means the basis of design and technical limits and parameters of
the Facility as set forth in the Agreement, including Schedule A-2.

“Disclosing Party” has the meaning set forth in Section 20.3.

 

3

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“Dispute” has the meaning set forth in Section 19.1.

“Drawings” means the graphic and pictorial documents, plans or models (in
written or electronic format) showing the design, location and dimensions of the
Work, generally including plans, elevations, sections, details, schedules and
diagrams, which are prepared as a part of and during the performance of the
Work, including those which fix and describe the Facility with respect to the
civil engineering, structural, instrumentation, control, mechanical, electrical,
plumbing, fire protection, acoustical and life safety systems.

“Effective Date” has the meaning set forth in the preamble.

“Electric Delivery Point” has the meaning set forth in Attachment T.

“Emissions Minimum Acceptance Criteria” or “Emissions MAC” has the meaning set
forth in Attachment T.

“EPC Payment Milestone” shall mean a designated portion of the Contract Price as
shown in Schedule C-1.

“EPC Payment Milestone portion of the Contract Price” shall have the meaning set
forth in Section 7.2A. The EPC Payment Milestone portion of the Contract Price
shall only be adjusted by Change Order.

“Equipment” means all equipment, materials, supplies and systems (including the
Siemens Equipment) required for the completion of and incorporation into the
Work.

“Facility” means the facilities contemplated in this Agreement, including the
natural gas-fired power generation facilities to be engineered, procured,
constructed, pre-commissioned, commissioned and tested by Contractor under this
Agreement, all of which are described and as set forth in more detail in
Attachment A.

“Final Completion” means that all Work and all other obligations under the
Agreement (except for that Work and obligations that survive the termination or
expiration of this Agreement, including obligations for Warranties and
correction of Defective Work), are fully and completely performed in accordance
with the terms of this Agreement, including: (i) the successful achievement of
Mechanical Completion and Substantial Completion; (ii) the completion of all
Punchlist items; (iii) delivery by Contractor to Owner of Contractor’s fully
executed Final Waiver and Release of Liens in the form of Schedule K-5 and Final
Claim Waiver in the form of Schedule K-6; (iv) delivery by Contractor to Owner
of all documentation required to be delivered under this Agreement, including
Record As-Built Drawings and Specifications, Owner’s Confidential Information
and the final operating and maintenance manuals for the Facility; (v) delivery
to Owner, in content and form reasonably satisfactory to Owner, copies of all
required Subcontracts, written assignments of Subcontractor warranties and a
list of the names, addresses and telephone numbers of the Subcontractors
providing such warranties; (vi) removal from the Site of all of Contractor’s,
Subcontractors’ and Sub-subcontractor’s personnel, supplies, waste, materials,
equipment (except Equipment), rubbish, Hazardous Materials, and temporary
facilities; (vii) delivery by Contractor to Owner of evidence acceptable to
Owner that all

 

4

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Major Subcontractors and Major Sub-subcontractors have been fully and finally
paid, including fully executed Final Waiver and Release of Liens in the form of
Schedule K-7 and Final Claim Waivers in the form of Schedule K-8 from all Major
Subcontractors; (viii) if requested by Owner, fully executed Final Waiver and
Release of Liens from Major Sub-subcontractors in a form substantially similar
to the form in Schedule K-7 and fully executed Final Claim Waivers from Major
Sub-subcontractors in a form substantially similar to the form in Schedule K-8;
(ix) achievement of all Performance Guarantees, or if all Performance Guarantees
are not achieved, the payment of all applicable Performance Liquidated Damages;
(x) achievement of the Starting Reliability Requirement; (xi) delivery to Owner
of all specialty tools required for the operation and maintenance of the
Facility and the operating spare parts (if any) required to be provided to Owner
under this Agreement (other than those operating spare parts for the Siemens
Equipment which are provided by Contractor pursuant to Section 3.4C);
(xii) delivery by Contractor to Owner of a Final Completion Certificate in the
form of Attachment N and as required under Section 12.6, which Owner has
accepted by signing such certificate; and (xiii) performance by Contractor of
all other obligations required under this Agreement for Final Completion.

“Final Completion Certificate” has the meaning set forth in Section 12.6.

“Final Geotechnical Report” has the meaning set forth in Section 2.5B.1.

“Final Claim Waiver” means the waiver and release of claims provided to Owner by
Contractor, Major Subcontractors and Major Sub-subcontractors in accordance with
the requirements of Section 7.3.

“Final Waiver and Release of Liens” means the waiver and release of liens
provided to Owner by Contractor, Major Subcontractors and Major
Sub-subcontractors in accordance with the requirements of Section 7.3.

“Force Majeure” shall mean any event or circumstance that (i) causes a failure
in or delay in the affected Party’s performance of its obligations under the
Agreement, (ii) is beyond the control of the affected Party and not due to its
fault or negligence (or any Person over whom that Party has control) and
(iii) cannot be avoided or overcome by the exercise of due diligence by the
Party (or any Person over whom that Party has control). To the extent meeting
the foregoing requirements, Force Majeure may include, but is not necessarily
limited to, acts of God, landslide, lightning, earthquake, hurricane, abnormally
severe storms, typhoons, cyclones, flood, tornado, or other natural disasters,
fire or explosions, sabotage, riot, acts of terrorism, war, blockade,
insurrection, civil disturbance, epidemic, transportation accidents affecting
delivery of Equipment only if such accident occurs prior to delivery to the
Site, and acts of public enemy or restraint by court order or other Governmental
Instrumentality. For the avoidance of doubt, Force Majeure shall not include
(a) any strike, lockout or other labor dispute affecting Contractor or any
subcontractor unless such strike, lockout or labor dispute is an industry-wide
or national event and otherwise meets the conditions above for a Force Majeure,
(b) any difficulty in obtaining or maintaining sufficient, or appropriately
skilled personnel to perform the Work, (c) late delivery, failure or breakages
of materials, equipment or supplies (including Equipment) unless otherwise
caused by Force Majeure, (d) normal wear and tear or

 

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obsolescence of any parts or equipment (including the Equipment) utilized in or
as part of the Work, (e) shortages, cost increases or unavailability of
equipment (including the Equipment) or materials, except with respect to
transportation accidents affecting delivery of equipment occurring prior to the
delivery of such equipment to the Site, (f) changes in market conditions,
(g) rain, snow, wind and temperature, regardless of the magnitude, severity,
duration or frequency, except to the extent comprising an abnormally severe
storm that meets the other requirements of a Force Majeure as set forth above,
(h) economic hardship or (i) nonperformance or delay by Contractor or any
subcontractor, unless such nonperformance or delay is otherwise caused by Force
Majeure.

“Fuel Requirements” has the meaning set forth in Attachment T.

“Good Engineering and Construction Practices” or “GECP” means the generally
accepted practices, methods, skill, care and techniques employed by the United
States power engineering and construction industries with respect to: (i) the
engineering, procurement, construction, pre-commissioning, commissioning,
testing and start-up of natural gas-fired power generation facilities, which
includes the Applicable Codes and Standards, Applicable Law, and the written
recommendations of the suppliers and manufacturers of Equipment provided
hereunder necessary to maintain supplier and manufacturer warranties and
designed performance; (ii) personnel and facility safety and environmental
protection; (iii) optimizing the scheduling of Work; and (iv) optimizing the
reliability and availability of the Facility under the operating conditions
reasonably expected at the Site, as specified in Attachment A. GECP are not
intended to be limited to the optimum practices, methods or techniques to the
exclusion of all others, but rather to be a spectrum of reasonable and prudent
practices, methods and techniques employed by the United States power
generation, engineering and construction industries.

“Governmental Instrumentality” shall mean any applicable federal, provincial,
regional, state or local government including any agencies, authorities,
departments or other subdivisions of each as well as the California Independent
Systems Operator, having or claiming an interest in or jurisdiction over a Party
or any portion of the Site, the Facility or the Work.

“GTG LNTP” has the meaning set forth in Section 5.2B.

“Guaranteed Net Heat Rate” has the meaning set forth in Attachment T.

“Guaranteed Net Power Output” has the meaning set forth in Attachment T.

“Guaranteed Substantial Completion Date” has the meaning set forth in
Section 5.3B.

“Hazardous Materials” means any substance that under Applicable Law is
considered to be hazardous or toxic or is or may be required to be remediated,
including (i) any petroleum or petroleum products, radioactive materials,
asbestos in any form that is or could become friable, transformers or other
equipment that contain dielectric fluid containing polychlorinated biphenyls and
processes and certain cooling systems that use chlorofluorocarbons, (ii) any
chemicals, materials or substances which are now or hereafter become defined as
or included in the definition of “hazardous substances,”

 

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“hazardous wastes,” “hazardous materials,” “extremely hazardous wastes,”
“restricted hazardous wastes,” “toxic substances,” “toxic pollutants,” or any
words of similar import pursuant to Applicable Law, or (iii) any other chemical,
material, substance or waste, exposure to which is now or hereafter prohibited,
limited or regulated by any Governmental Instrumentality, or which may be the
subject of liability for damages, costs or remediation.

“Indemnified Party” means any member of Owner Group or Contractor Group, as the
context requires.

“Indemnifying Party” means Owner or Contractor, as the context requires.

“Interim Claim Waiver” means the waiver and release of claims provided to Owner
by Contractor, Major Subcontractors and Major Sub-subcontractors in accordance
with the requirements of Section 7.2C.

“Interim Waiver and Release of Liens” means the waiver and release of liens
provided to Owner by Contractor, Major Subcontractors and Major
Sub-subcontractors in accordance with the requirements of Section 7.2C.

“Investment Grade” has the meaning set forth in Section 10.2.

“Invoice” means Contractor’s request for a payment pursuant to Section 7.2B for
a progress payment and pursuant to Section 7.3 for final payment, which invoice
shall be in the form of Schedule I-1 for progress payments and Schedule I-2 for
final payment.

“ISO Conditions” has the meaning set forth in Attachment T.

“Key Milestones” shall mean certain portions of the Work, as further described
in the Key Milestone Schedule in Attachment E, which Contractor is to complete
by the applicable Key Milestone Date. For the avoidance of doubt, the Key
Milestones do not include the Guaranteed Substantial Completion Date or the
Required Final Completion Date.

“Key Milestone Dates” shall mean those dates for completion of Key Milestones
set forth in the Key Milestone Schedule in Attachment E.

“Key Milestone Schedule” means the schedule of Key Milestone Dates in which
Contractor is required to complete certain Key Milestones in the Work as more
particularly described in Attachment E. For purposes of clarity, the Key
Milestone Schedule shall mean the actual dates specified for each Key Milestone
as set forth in Attachment E and shall not incorporate (or otherwise be a
reference to) the time periods set forth in Attachment E which relate to time
periods of delay obligating Contractor to commence recovery efforts or giving
rise to a Default.

“Key Personnel” or “Key Persons” has the meaning set forth in Section 2.2A.

“Kiewit Termination Charge” has the meaning set forth in Section 17.2.

 

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“Lender” means any entity or entities providing temporary or permanent debt
financing to Owner for the Facility.

“Limited Notice to Proceed” or “LNTP” has the meaning set forth in Section 3.3B.

“Liquidated Damages” means Performance Liquidated Damages and Substantial
Completion Delay Liquidated Damages.

“Major Subcontract” means any Subcontract either (i) having an aggregate value
in excess of One Million U.S. Dollars (U.S.$1,000,000) or (ii) multiple
Subcontracts with one Subcontractor that have an aggregate value in excess of
One Million U.S. Dollars (U.S.$1,000,000). For the avoidance of doubt, the
Siemens Contract shall be a Major Subcontract.

“Major Subcontractor” means any Subcontractor with whom Contractor enters, or
intends to enter, into a Major Subcontract. For the avoidance of doubt, Siemens
shall be a Major Subcontractor.

“Major Sub-subcontract” means (A) any Sub-subcontract that the Siemens Contract
identifies as a “Major Subcontract” (as such term is defined in the Siemens
Contract) or (B) (i) any Sub-subcontract not falling under the Siemens Contract
which has an aggregate value in excess of One Million U.S. Dollars
(U.S.$1,000,000), or (ii) multiple Sub-subcontracts with one Sub-subcontractor
(not falling under the Siemens Contract) that have an aggregate value in excess
of One Million U.S. Dollars (U.S.$1,000,000).

“Major Sub-subcontractor” means any Sub-subcontractor with whom a Subcontractor
or Sub-subcontractor enters, or intends to enter, into a Major Sub-subcontract.

“Maximum Cumulative Payment Schedule” has the meaning set forth in Section 7.2E.

“Mechanical Completion” shall mean, with respect to an applicable system or
subsystem of Equipment for the Facility, that, with the exception of Punchlist
items, all of the following have occurred: (i) Contractor has completed all
procurement, fabrication, assembly, erection and installation and
pre-commissioning checks and tests for such system or subsystem (as further
described in the Scope of Work) to ensure that the applicable system or
subsystem (including all Equipment related to such system or subsystem) was
correctly fabricated, assembled, erected and installed and is capable of being
operated safely and reliably within the requirements and specifications
contained in the Agreement, including the setting of such Equipment on
foundations, connecting such Equipment to other applicable Equipment with
piping, wiring, controls, and safety systems, ensuring that such Equipment and
such related operating systems are individually cleaned, leak checked,
lubricated, and point-to-point checked to verify that such Equipment and
operating systems have been correctly installed so as to respond to simulated
test signals equivalent to actual signals received during operation, and are
ready for initial operation, adjustment and testing and may be so operated,
adjusted and tested without damage thereto or to any other property and without
injury to any Person, all as set forth in greater detail in Attachments A and V
and the Mechanical Completion checklists agreed by Owner and Contractor in
accordance with Section 12.1B; (ii) Contractor has

 

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completed the Work, to the extent necessary, to cause such system or subsystem
to be capable of operating safely in accordance with Applicable Laws, prudent
utility practices, and GECP for further commissioning and testing;
(iii) Contractor has submitted to Owner an initial Punchlist of items as set
forth in Section 12.5A; (iv) Contractor has delivered to Owner a Mechanical
Completion Certificate for the applicable system or subsystem in the form of
Attachment L and Owner has accepted such certificate by signing such
certificate; and (v) Contractor has performed all other obligations required
under the Agreement for Mechanical Completion.

“Mechanical Completion Certificate” has the meaning set forth in Section 12.1B.

“Memorandum of Understanding” or “MOU” means the Memorandum of Understanding
between Owner and Contractor, dated April 16, 2009, including any amendments
thereto.

“Minimum Acceptance Criteria” or “MAC” means the Net Power Output Minimum
Acceptance Criteria, the Net Heat Rate Minimum Acceptance Criteria, the
Emissions Minimum Acceptance Criteria, the Ramp Time Minimum Acceptance Criteria
and the Sound Level Minimum Acceptance Criteria.

“Minimum Acceptance Criteria Correction Period” has the meaning set forth in
Section 12.4A.

“Mirant Delta Facility” means the existing electric generation facility of
Mirant Delta, LLC located near Antioch, California which is adjacent to the
location where the Facility will be built.

“Month” means a Gregorian calendar month; “month” means any period of thirty
(30) consecutive Days.

“Monthly” means an event occurring or an action taken once every Month.

“Monthly Progress Reports” has the meaning set forth in Section 3.19A.4.

“Monthly Updated CPM Schedule” has the meaning set forth in Section 5.4D.

“NERC” means the North American Electric Reliability Corporation.

“Net Heat Rate” has the meaning set forth in Attachment T.

“Net Heat Rate Minimum Acceptance Criteria” or “Net Heat Rate MAC” has the
meaning set forth in Attachment T.

“Net Heat Rate Performance Liquidated Damages” has the meaning set forth in
Attachment T.

“Net Power Output” has the meaning set forth in Attachment T.

 

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“Net Power Output Minimum Acceptance Criteria” or “Net Power Output MAC” has the
meaning set forth in Attachment T.

“Net Power Output Performance Liquidated Damages” has the meaning set forth in
Attachment T.

“Notice to Proceed” or “NTP” has the meaning set forth in Section 3.3B.

“Owner” has the meaning set forth in the preamble hereto.

“Owner Group” means (i) Owner and its parents, Affiliates and Lenders, and
(ii) the directors, officers, employees, agents, attorneys and other
professional advisors of any of the Persons specified in clause (i) above.

“Owner Letter of Credit” has the meaning set forth in Section 10.4.

“Owner Representative” means that Person or Persons designated by Owner in a
written notice to Contractor who shall have complete authority to act on behalf
of Owner on all matters pertaining to the Work, including giving instructions
and making changes in the Work. Owner designates Mike Ammer as the Owner
Representative. Notification of a change in Owner Representative shall be
provided in advance, in writing, to Contractor.

“Owner’s Confidential Information” has the meaning set forth in Section 20.1.

“Party” or “Parties” means Owner and/or Contractor and their successors and
permitted assigns.

“Payment Milestone” shall mean, as the context requires, a Siemens Equipment
Payment Milestone, a EPC Payment Milestone or both. “Payment Milestones” shall
mean, as the context requires, any or all Siemens Equipment Payment Milestones
and EPC Payment Milestones.

“Payment Schedule” is set forth in Attachment C, which sets out the payments to
be paid based on achievement of Siemens Equipment Payment Milestones and EPC
Payment Milestones.

***

“Performance Guarantee(s)” means the Guaranteed Net Power Output and the
Guaranteed Net Heat Rate.

“Performance Liquidated Damages” means the Net Power Output Performance
Liquidated Damages and the Net Heat Rate Performance Liquidated Damages.

“Performance Tests” means those tests performed to determine whether the
Facility meets the Performance Guarantees and Minimum Acceptance Criteria, which
tests shall be set forth in Attachment S and, to the extent not specified
therein, as developed in accordance with Section 12.2.

 

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“Permit” means any valid waiver, certificate, approval, consent, license,
exemption, variance, franchise, permit, authorization or similar order or
authorization from any Governmental Instrumentality required to be obtained or
maintained in connection with the Facility, the Site or the Work.

“Person” means any individual, company, joint venture, corporation, partnership,
association, joint stock company, limited liability company, trust, estate,
unincorporated organization, Governmental Instrumentality or other entity having
legal capacity.

“PG&E” means Pacific Gas and Electric Company, or its successors or assigns.

“PLA” means the Project Labor Agreement for the Marsh Landing Generating Station
Project entered into by and among Contractor, the State Building and
Construction Trades Council of California, the Contra Costa County Building and
Construction Trades Council and various local unions.

“Preliminary Engineering LNTP” has the meaning set forth in Section 5.2B.

“Progress As-Built Drawings and Specifications” means Drawings and
Specifications that show all current “as-built” conditions, as required under
Attachment B.

“Punchlist” means a list of those finishing items required to complete the Work,
the completion of which shall not interrupt, disrupt or interfere with the safe
and reliable operation or use of all or any part of the Facility as contemplated
by this Agreement, as more fully described in Section 12.5.

“Ramp Time Minimum Acceptance Criteria” or “Ramp Time MAC” has the meaning set
forth in Attachment T.

“Receiving Party” has the meaning set forth in Section 20.3.

“Record As-Built Drawings and Specifications” means final, record Drawings and
Specifications of the Facility showing the “as-built” conditions of the
completed Facility, as required under Attachment B.

“Recovery Schedule” has the meaning set forth in Section 5.5.

“Release for Engineering LNTP” has the meaning set forth in Section 5.2C.

“Required Final Completion Date” has the meaning set forth in Section 5.3C.

“Retainage” means the amount retained by Owner from Contractor from each Invoice
for payments owed under this Agreement, except for payments owed on the Siemens
Equipment Payment Milestone portion of the Contract Price. The Retainage shall
be in the amount of *** of the foregoing payments owed by Owner to Contractor.

“Scope of Work” means the description of Work to be performed by Contractor as
set forth in this Agreement, including Attachment A.

 

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“Siemens” means Siemens Energy, Inc. Due to the assignment of the Siemens
Contract to Contractor pursuant to Section 22.8, Siemens shall be considered a
Subcontractor to Contractor.

“Siemens Confidential Information” has the meaning set forth in Section 20.7.

“Siemens Contract” means that certain Contract for Gas Turbine Generator
Equipment Supply and Services between Owner and Siemens, dated September 2,
2009, together with all amendments and change orders thereto, which has been
assigned from Owner to Contractor pursuant to Section 22.8.

“Siemens Equipment” means all equipment to be provided under the Siemens
Contract, including four (4) Siemens SGT6-PAC 5000F simple cycle gas turbine
generating units, four (4) generator step-up transformers, fuel gas conditioning
equipment and fuel gas compressors.

“Siemens Equipment Payment Milestone” shall mean a designated portion of the
Contract Price as shown in Schedule C-2.

“Siemens Equipment Payment Milestone portion of the Contract Price” shall have
the meaning set forth in Section 7.2A. The Siemens Equipment Payment Milestone
portion of the Contract Price shall only be adjusted by Change Order.

“Siemens Termination Payment” has the meaning set forth in Section 10.4.

“Site” means those parcels of land where the Facility shall be located, as shown
in greater detail in Attachment Y.

“Soil Report” has the meaning set forth in Section 2.5B.1.

“Sounds Level Minimum Acceptance Criteria” or “Sound Level MAC” has the meaning
set forth in Attachment T.

“Specifications” means those documents consisting of the written requirements
for Equipment, standards of workmanship for the Work and performance of related
services, which are prepared as a part of and during the performance of the
Work.

“Starting Reliability Requirement” shall have the meaning set forth in
Attachment T.

“Subcontract” means an agreement by Contractor with a Subcontractor for the
performance of any portion of the Work.

“Subcontractor” means any Person, including an Equipment supplier or vendor, who
has a direct contract with Contractor to manufacture or supply Equipment which
is a portion of the Work, to lease equipment to Contractor in connection with
the Work, to perform a portion of the Work or to otherwise furnish labor or
materials or equipment (including Equipment).

 

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“Substantial Completion” means that all of the following have occurred with
respect to the Facility: (i) Mechanical Completion of the Facility; (ii) all
Minimum Acceptance Criteria have been achieved; (iii) Contractor and Owner have
agreed upon a revised and updated Punchlist of items as set forth in
Section 12.5B; (iv) all Work has been completed (including training and the
delivery of all documentation, manuals and instruction books necessary for safe
and proper operation), except for Work on the Punchlist and the Final Completion
requirements identified in clauses (ii) through (xii) of the definition of Final
Completion set forth in this Article 1, in accordance with the requirements and
specifications of this Agreement; (v) Contractor has delivered to Owner the
Substantial Completion Certificate in the form of Attachment M and as required
under Section 12.2 and Owner has accepted such certificate by signing such
certificate; (vi) the Facility is available for commercial operation and can be
safely used for its intended purpose and all four (4) Units and all related
systems can be safely and reliably operated within the requirements and
specifications of the Agreement in order to deliver electrical output in
accordance with the requirements and specifications of the Agreement;
(vii) Contractor has obtained all Permits for the Facility that it is obligated
to obtain under this Agreement; (viii) certificates of occupancy for all
applicable buildings at the Facility have been issued; (ix) Contractor has
assigned to or provided Owner with all Warranties to the extent Contractor is
obligated to do so pursuant to this Agreement (including Section 13.1C); and
(x) Contractor has performed all other obligations required under this Agreement
for Substantial Completion.

“Substantial Completion Certificate” has the meaning set forth in Section 12.2.

“Substantial Completion Delay Liquidated Damages” has the meaning set forth in
Section 14.1.

“Sub-subcontract” means any agreement by a Subcontractor with a
Sub-subcontractor or by a Sub-subcontractor with another Sub-subcontractor for
the performance of any portion of the Work.

“Sub-subcontractor” means any Person, including an Equipment supplier or vendor,
who has a direct or indirect contract with a Subcontractor or another
Sub-subcontractor to manufacture or supply Equipment which comprises a portion
of the Work, to lease equipment to Subcontractor or another Sub-subcontractor in
connection with the Work, to perform a portion of the Work or to otherwise
furnish labor, materials or equipment (including Equipment).

“Taxes” means any and all taxes, assessments, levies, duties, fees, charges and
withholdings of any kind or nature whatsoever and howsoever described, including
value-added, sales and use taxes, gross receipts, license, payroll, federal,
state, local or foreign income, environmental, profits, severance, premium,
franchise, property, excise, capital stock, import, stamp, transfer, employment,
occupation, generation, privilege, utility, regulatory, energy, consumption,
lease, filing, recording and activity taxes, levies, duties, fees, charges,
imposts and withholding, together with any and all penalties, interest and
additions thereto.

 

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“Third Party Proprietary Work Product” has the meaning set forth in
Section 11.1.

“U.S. Dollars” or “U.S.$” means the legal tender of the United States of
America.

“Unit” shall mean a gas turbine generator package to be installed into and form
a part of the Facility, including the combustion turbine, the electric
generator, the generator step-up transformer, the selective catalytic reduction
system and oxidation catalyst and all other components, accessories, and
ancillary parts and systems between the fuel supply interface and the high-side
of the generator step up transformers related to such the gas turbine generator
package, as well as that portion of the Work associated with such Equipment. The
Facility shall have four (4) Units.

“Warranty” or “Warranties” has the meaning set forth in Section 13.1A.

“Weekly Progress Report” has the meaning set forth in Section 3.19A.3.

“Work” means all obligations, duties and responsibilities required of Contractor
pursuant to this Agreement, including all Equipment (including all Siemens
Equipment and all Units), construction equipment (including materials,
apparatus, structures, supplies, tools, machinery, equipment and scaffolding),
spare parts, procurement, engineering, design, fabrication, erection,
installation, manufacture, delivery, transportation, storage, construction,
workmanship, labor, pre-commissioning, commissioning, inspection, training,
Performance Tests, other tests, start-up and any other services, work or things
furnished or used or required to be furnished or used, by Contractor in the
performance of this Agreement, including that set forth in Attachment A and
Section 3.1A and any Corrective Work.

“Work Cost” has the meaning set forth in Section 17.2A.

“Work Product” has the meaning set forth in Section 11.1.

1.2 The meanings specified in this Article 1 are applicable to both the singular
and plural. As used in this Agreement, the terms “herein,” “herewith,”
“hereunder” and “hereof” are references to this Agreement taken as a whole, and
the terms “include,” “includes” and “including” mean “including, without
limitation,” or variant thereof. Unless expressly stated otherwise, reference in
this Agreement to an Article or Section shall be a reference to an Article or
Section contained in this Agreement (and not in any Attachments or Schedules to
this Agreement) and reference in this Agreement to an Attachment or Schedule
shall be a reference to an Attachment or Schedule attached to this Agreement.

ARTICLE 2

RELATIONSHIP OF OWNER, CONTRACTOR AND SUBCONTRACTORS

2.1 Status of Contractor. The relationship of Contractor to Owner shall be that
of an independent contractor. Any provisions of this Agreement which may appear
to give Owner or the Owner Representative the right to direct or control
Contractor as to details of performing the Work, or to exercise any measure of
control over the Work, shall be deemed to mean that Contractor shall follow the
desires of Owner or the Owner Representative in the results of the

 

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Work only and not in the means by which the Work is to be accomplished, and
Contractor shall have the complete right, obligation and authoritative control
over the Work as to the manner, means or details as to how to perform the Work.
Nothing herein shall be interpreted to create a master-servant or
principal-agent relationship between Contractor, or any of its Subcontractors or
Sub-subcontractors, and Owner. Nevertheless, Contractor shall strictly comply
with all provisions, terms and conditions of this Agreement, and the fact that
Contractor is an independent contractor does not relieve it from its
responsibility to fully, completely, timely and safely perform the Work in
strict compliance with this Agreement.

2.2 Key Personnel, Organization Chart and Contractor Representative.

A. Key Personnel and Organization Chart. Attachment F sets forth Contractor’s
organizational chart to be implemented for the Work and also contains a list of
key personnel (“Key Personnel” or “Key Persons”) from Contractor’s organization
who will be assigned to the Work. Owner and Contractor acknowledge and agree the
continuity of Key Personnel during the performance of the Work is a material
requirement of this Agreement and that replacement of a Key Person may be
detrimental to the Owner and the overall quality of the Work. Key Personnel
shall, unless otherwise expressly stated in Attachment F, be devoted essentially
full-time to the Work for the entire duration of the Work, and Key Personnel
shall not be removed or reassigned without Owner’s prior written approval, which
shall not be unreasonably withheld. All requests for the substitution of Key
Personnel shall include a detailed explanation and reason for the request and
the resumes of professional education and experience for one or more substitute
candidates for Owner’s approval (such approval not to be unreasonably withheld).
The additional cost of any replacement of such Key Personnel and any overlap
time during the transition from one Key Person to another shall be entirely at
Contractor’s expense. Owner has the right, but not the obligation, to require
Contractor to remove or cause to be removed a Key Person who is not, in Owner’s
reasonable judgment, acting safely and reasonably in the performance of the
portion of the Work assigned to such Key Person.

B. Contractor Representative. Contractor designates *** as the Contractor
Representative. Notification of a change in Contractor Representative shall be
provided in advance, in writing, to Owner. The Contractor Representative is a
Key Person.

2.3 Subcontractors and Sub-subcontractors. Owner acknowledges and agrees that
Contractor intends to have portions of the Work accomplished by Subcontractors
pursuant to written Subcontracts between Contractor and such Subcontractors, and
that such Subcontractors may have certain portions of the Work performed by
Sub-subcontractors. All Subcontractors and Sub-subcontractors shall be
reputable, qualified firms with an established record of successful performance
in their respective trades performing identical or substantially similar work.
NO SUBCONTRACTOR OR SUB-SUBCONTRACTOR IS INTENDED TO BE OR SHALL BE DEEMED A
THIRD-PARTY BENEFICIARY OF THIS AGREEMENT. Contractor shall be fully responsible
to Owner for the acts and omissions of Subcontractors and Sub-subcontractors and
of Persons directly or indirectly employed by any of them, as Contractor is for
the acts or omissions of Persons directly employed by Contractor. All
Subcontractors and Sub-subcontractors and their respective personnel are to be
instructed by Contractor in the terms and requirements of Owner-approved

 

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safety and environmental protection policies and procedures and shall be
expected to comply with such policies and procedures. In the event that any
personnel do not adhere to such policies and procedures, such personnel shall be
removed by Contractor. In no event shall Contractor be entitled to any
adjustment of the Contract Price, the Key Milestone Schedule, the Guaranteed
Substantial Completion Date or the Required Final Completion Date as a result of
compliance with such policies and procedures or any removal of personnel
necessitated by non-compliance. Nothing contained herein shall (i) create any
contractual relationship between any Subcontractor and Owner, or between any
Sub-subcontractor and Owner, or (ii) obligate Owner to pay or cause the payment
of any amounts to any Subcontractor or Sub-subcontractor.

2.4 Subcontracts and Sub-subcontracts.

A. Approved List. Attachment G sets forth a list of Subcontractors and
Sub-subcontractors that Contractor and Owner have agreed are approved
Subcontractors and Sub-subcontractors for the performance of that portion of the
Work specified in Attachment G. Approval by Owner of any Subcontractors or
Sub-subcontractors (either as set forth in Attachment G, pursuant to this
Section 2.4 or otherwise) does not relieve Contractor of any responsibilities
under this Agreement.

B. Additional Proposed Major Subcontractors and Major Sub-subcontractors. In the
event that Contractor is considering the selection of a Subcontractor or
Sub-subcontractor not listed on Attachment G that would qualify as a Major
Subcontractor or Major Sub-subcontractor, Contractor shall (i) notify Owner of
its proposed Major Subcontractor or Major Sub-subcontractor as soon as possible
during the selection process and furnish to Owner all information reasonably
requested by Owner with respect to Contractor’s selection criteria, and
(ii) notify Owner no less than fifteen (15) Days prior to the execution of a
Major Subcontract with a Major Subcontractor or Major Sub-subcontract with a
Major Sub-subcontractor not listed on Attachment G. Owner shall have the
discretion, not to be unreasonably exercised, to reject any proposed Major
Subcontractor or Major Sub-subcontractor not listed on Attachment G for a Major
Subcontract or Major Sub-subcontract. Contractor shall not enter into any Major
Subcontract with a proposed Major Subcontractor or Major Sub-subcontract with a
Major Sub-subcontractor that is rejected by Owner in accordance with the
preceding sentence. Owner shall undertake in good faith to review the
information provided by Contractor pursuant to this Section 2.4B expeditiously
and shall notify Contractor of its decision to accept or reject a proposed Major
Subcontractor or Major Sub-subcontractor as soon as practicable after such
decision is made. Failure of Owner to accept a proposed Major Subcontractor or
Major Sub-subcontractor within fifteen (15) Days after Owner’s receipt of the
notice to be provided by Contractor as set forth above shall be deemed to be an
acceptance of such Major Subcontractor or Major Sub-subcontractor. For purposes
of clarity, Owner’s approval shall not be required for the selection or
replacement of a Subcontractor or Sub-subcontractor that is not a Major
Subcontractor or Major Sub-subcontractor.

C. Other Additional Proposed Subcontractors and Sub-subcontractors. For any
Subcontractor not covered by Sections 2.4A or 2.4B, Contractor shall, within
thirty (30) Days prior to the selection of any such Subcontractor, notify Owner
in writing of the

 

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selection of such Subcontractor and inform Owner generally what portion of the
Work such Subcontractor is performing.

D. Delivery of Major Subcontracts. Contractor shall furnish Owner with a copy of
all Subcontracts within ten (10) Days after Owner’s written request. Contractor
may deliver such Subcontracts with the pricing information redacted therefrom.
Notwithstanding the above, Owner’s receipt and review of any Subcontracts shall
not relieve the Contractor of any obligations under this Agreement nor shall
such action constitute a waiver of any right or duty afforded Owner under this
Agreement or approval of or acquiescence in a breach hereunder.

E. Terms of Major Subcontracts and Major Sub-subcontracts. In addition to the
requirements in Section 2.3 and without in any way relieving Contractor of its
full responsibility to Owner for the acts and omissions of Subcontractors and
Sub-subcontractors, Contractor shall:

1. include in each Major Subcontract and Major Sub-subcontract, a provision that
each such Major Subcontract and Major Sub-subcontract may be assigned to Owner
without the consent of the respective Major Subcontractor or Major
Sub-subcontractor upon termination of this Agreement; and

2. use reasonable commercial efforts to include in each Major Subcontract and
Major Sub-subcontract a provision requiring each such Major Subcontractor and
Major Sub-subcontractor to comply with and perform for the benefit of Owner all
requirements and obligations of Contractor to Owner under this Agreement, as
such requirements and obligations are applicable to the performance of the work
under the respective Major Subcontract or Major Sub-subcontract; provided,
however, at a minimum, Contractor shall include in each Major Subcontract and
Major Sub-subcontract (except for Major Sub-subcontracts for the supply of bulk
materials or commodities), for the benefit of Owner, provisions substantially
similar to the following provisions set forth in this Agreement: Article 11, and
Sections 3.16, 9.1, and 22.11.

2.5 Contractor Acknowledgements.

A. The Agreement. Prior to the execution of this Agreement, Contractor performed
engineering, cost estimating and related services and developed and provided the
information that forms the Scope of Work and Design Basis listed in Attachment
A, which was performed pursuant to the MOU. Owner has relied upon Contractor’s
expertise in developing and providing such information. Contractor hereby
represents that such information and the attached Scope of Work and the Design
Basis in Attachment A are accurate, adequate and complete to engineer, procure,
construct, pre-commission, commission, start-up and test a fully operational
natural gas-fired power generation facility for the Contract Price, within the
required times set forth by the Key Milestone Schedule, the Guaranteed
Substantial Completion Date and Required Final Completion Date, and in
accordance with all requirements of this Agreement, including Applicable Codes
and

 

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Standards, Applicable Law, the Warranties, Minimum Acceptance Criteria and
Performance Guarantees, and that with respect to any information (if any) not so
developed or provided by Contractor, Contractor has examined all such
information and has determined that it is accurate, adequate and complete.
Accordingly, Contractor (i) hereby agrees that it shall have no right to claim
or seek an increase in the Contract Price or an adjustment to the Key Milestone
Schedule, Guaranteed Substantial Completion Date or Required Final Completion
Date with respect to any incomplete, inaccurate or inadequate information or
requirements that may be contained or referenced in Attachment A, and
(ii) hereby waives and releases Owner from and against such claims. Owner makes
no guaranty or warranty, express or implied, as to the accuracy, adequacy or
completeness of any such information that is contained or referenced in
Attachment A.

B. Conditions of the Site. Except as expressly provided for in this
Section 2.5B.1, Contractor further agrees and acknowledges that it has made all
investigations and inspections that it deems necessary to perform the Work in
accordance with the Key Milestone Schedule, the Guaranteed Substantial
Completion Date and the Required Final Completion Date, and understands the
climate, terrain and other difficulties that it may encounter in performing the
Work in accordance with the Key Milestone Schedule, the Guaranteed Substantial
Completion Date and Required Final Completion Date. Contractor warrants that it
has the experience, resources, qualifications and capabilities at its disposal
to perform the Work in accordance with the Key Milestone Schedule, the
Guaranteed Substantial Completion Date and the Required Final Completion Date.
Except as expressly provided for in Sections 2.5B.1, 6.2A.5, and 6.2A.6,
Contractor assumes all risks related to, and waives any right to claim an
adjustment in the Contract Price, the Key Milestone Schedule, the Guaranteed
Substantial Completion Date or the Required Final Completion Date in respect of,
any failure to timely perform the Work in accordance with the Key Milestone
Schedule, the Guaranteed Substantial Completion Date and the Required Final
Completion Date as a result of any conditions at the Site or at any other
location where the Work is performed (excluding Force Majeure events), including
assuming all risk and waiving all rights with respect to: (i) river levels,
topography and subsurface conditions; (ii) climatic conditions, tides, and
seasons; (iii) availability of laborers, Subcontractors, Sub-subcontractors,
equipment or any other items or supplies; (iv) adequate availability and
transportation of Equipment; and (v) breakdown or other failure of equipment
under the control of or provided by Contractor or its Subcontractors or
Sub-subcontractors.

1. The Contract Price included herein is based on the subsurface soil report
titled “Geotechnical Data Report, Geotechnical Investigation, Contra Costa Power
Plant Unit 8 Project, Contra Costa County, California,” dated May 25, 2001
(“Soil Report”), which is based on a site near the Site. A final geotechnical
study will be performed at the Site by, or on behalf of, Contractor (which will
include testing of the subsurface under the existing structures at the Site),
and a report will be generated from such study by or on behalf of Contractor and
based upon Contractor’s specifications (the “Final Geotechnical Report”) prior
to Owner’s issuance of the Demolition LNTP. If the subsurface conditions as
shown by the Final Geotechnical Report are materially different from the Soil
Report, the Contract Price shall be adjusted up or down pursuant to a Change
Order to the

 

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extent the different subsurface conditions require additional work or reduce
work. Contractor’s relief for any material differences between the Soil Report
and the Final Geotechnical Report shall be limited to an adjustment in the
Contract Price, the Key Milestone Schedule, the Guaranteed Substantial
Completion Date and the Required Final Completion Date; provided, however,
Contractor shall use best efforts to prevent any extension to the Key Milestone
Schedule, Guaranteed Substantial Completion Date and Required Final Completion
Date as a result of such differences. The Parties agree that only significant
differences in subsurface conditions that would cause a major change in the
manner, means or methods of constructing the foundations would require an
extension to the Key Milestone Schedule, Guaranteed Substantial Completion Date
and Required Final Completion Date, but mere changes in the number or type of
piles would not entitle Contractor to such an extension. After the Final
Geotechnical Report is issued, and the Contract Price, Key Milestone Schedule,
Guaranteed Substantial Completion Date and Required Final Completion Date is
adjusted (if and to the extent allowed under this Section 2.5B.1), Contractor
shall assume all subsurface risks at the Site, except for unknown underground
utilities, manmade subsurface obstructions, rocks that require blasting,
sinkholes and archeological finds as further provided for in Section 6.2A.5.

C. Applicable Law and Applicable Codes and Standards.

1. Subject to Section 2.5C.2. Contractor has investigated to its satisfaction
Applicable Law and Applicable Codes and Standards and warrants that it can
perform the Work at the Contract Price and within the Key Milestone Schedule,
Guaranteed Substantial Completion Date and Required Final Completion Date in
accordance with Applicable Law and Applicable Codes and Standards.

2. If a Change in Law occurs, Contractor shall perform the Work in accordance
with such Change in Law and shall be entitled to a Change Order for such Change
in Law to the extent allowed under Section 6.2A.1.

ARTICLE 3

CONTRACTOR’S RESPONSIBILITIES

3.1 Scope of Work.

A. Generally. Subject to Section 3.1B, the Work shall be performed on a turnkey
basis and shall include all engineering, procurement, construction,
pre-commissioning, commissioning, start-up and testing of the Facility, all
Equipment, construction equipment (including materials, apparatus, structures,
supplies, tools, machinery, equipment and scaffolding), spare parts, labor,
workmanship, inspection, manufacture, fabrication, installation, design,
delivery, transportation, storage, training of Owner’s operating personnel and
all other items or tasks that are set forth in Attachment A, or otherwise
required to achieve Final Completion in accordance with the requirements of this
Agreement, including achieving the Minimum Acceptance Criteria and Performance

 

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Guarantees. Contractor shall be required to integrate and use Owner’s operations
personnel (which are provided by Owner pursuant to Section 4.4) in Contractor’s
pre-commissioning, commissioning, testing and start-up efforts. Contractor shall
perform the Work in accordance with GECP, Applicable Law, Applicable Codes and
Standards, and all other terms and provisions of this Agreement, with the
explicit understanding that the Facility will operate as a natural gas-fired
power generation facility meeting all requirements and specifications of this
Agreement, including Warranties, Minimum Acceptance Criteria and Performance
Guarantees. It is understood and agreed that the Work shall include any
incidental work that can reasonably be inferred as required and necessary to
complete the Facility in accordance with GECP, Applicable Law, Applicable Codes
and Standards, and all other terms and provisions of this Agreement, excluding
only those items which Owner has specifically agreed to provide under the terms
of the Agreement. Without limiting the generality of the foregoing, the Work is
more specifically described in Attachment A.

B. Exception to Scope of Work. Contractor shall not be responsible for providing
those items identified in Article 4 as Owner’s obligations.

3.2 Specific Obligations. Without limiting the generality of Section 3.1 or the
requirements of any other provision of this Agreement, Contractor shall:

A. procure, supply, transport, handle, properly store, assemble, erect and
install all Equipment;

B. provide construction, construction management (including the furnishing of
all field supplies, tools, construction equipment, and all Site supervision and
craft labor), civil/structural, electrical, instrumentation, field design,
inspection and quality control services required to ensure that the Work is
performed in accordance herewith;

C. negotiate all guarantees, warranties, delivery schedules and performance
requirements with all Subcontractors so that all Subcontracts are consistent
with this Agreement to the extent required under Sections 2.3 and 2.4;

D. perform shop and other inspections of the work of Subcontractors and
Sub-subcontractors to ensure that such work meets all of the requirements of
this Agreement;

E. pay Subcontractors in a timely fashion in accordance with the respective
Subcontracts;

F. ensure that the Work is performed in accordance with the Key Milestone
Schedule, Guaranteed Substantial Completion Date and Required Final Completion
Date;

G. conduct and manage all pre-commissioning, start-up operations, commissioning,
Performance Tests and other testing of the Facility, while supervising operating
personnel provided by Owner;

H. obtain all Permits required per Section 3.12;

 

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I. provide pre-commissioning, commissioning, testing and start-up spare parts
and operating spare parts as required per Section 3.4 (the cost of such
operating spare parts to be reimbursed by Owner in accordance with
Section 6.2A.11);

J. remove waste materials and rubbish from the Site as required per Section 3.9;

K. provide reasonable and prompt assistance, information and documentation
required or requested by Owner to enable Owner to obtain or modify the Permits
listed in Attachment Q;

L. provide training and certification for Owner’s operating and maintenance
personnel per Section 3.5;

M. ensure all Subcontractors perform their Subcontract obligations;

N. cooperate with and respond promptly to inquiries from Owner;

O. supply all initial fills of lubricants and chemicals and transformer oils and
all consumables necessary to perform the Work through Substantial Completion;
and

P. perform all design and engineering Work in accordance with this Agreement,
including that specified in Section 3.3.

3.3 Design and Engineering Work.

A. General. Contractor shall, as part of the Work, perform all design and
engineering Work in accordance with this Agreement and cause the Work to meet
and achieve the requirements of this Agreement, including achieving the Minimum
Acceptance Criteria and Performance Guarantees.

B. Drawings and Specifications. Upon receipt of a limited notice to proceed
(“Limited Notice to Proceed” or “LNTP”) or the full notice to proceed (“Notice
to Proceed” or “NTP”) issued in accordance with Section 5.2, Contractor shall
commence the preparation of the Drawings and Specifications for all Work
relating to such LNTP or NTP. The Drawings and Specifications shall be based on
the requirements of this Agreement, including the Scope of Work, Design Basis,
GECP, Applicable Codes and Standards, Applicable Law, and all applicable
provisions of this Agreement.

C. Review Process.

1. Over-the-Shoulder Review. During the development of the Drawings and
Specifications, Contractor shall provide Owner with the opportunity to perform
“over-the-shoulder” reviews of the design and engineering in progress. Such
reviews may be conducted at Contractor’s office located in Lenexa, Kansas,
remotely by electronic internet access or, if agreed upon by Contractor (such
agreement not to be unreasonably withheld), at the applicable Subcontractor’s or
Sub-subcontractor’s offices. The reviews

 

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may be of progress prints, computer images, draft documents, working
calculations, draft specifications or reports, Drawings, Specifications or other
design documents as reasonably determined by Owner.

2. Submission by Contractor. Contractor shall submit copies of the Drawings and
Specifications to Owner for formal review, comment, disapproval and approval in
accordance with Attachment B.

3. Review Periods. Owner shall have up to fifteen (15) Days from its receipt of
Drawings and Specifications submitted in accordance with Section 3.3C.2 to issue
written comments, proposed changes and/or written approvals or disapprovals of
the submission of such Drawings and Specifications to Owner; provided, however,
with respect to those Drawings and Specifications identified in Attachment B as
being time sensitive, Owner shall provide its comments, approvals or
disapprovals within ten (10) Days after receipt.

4. No Owner Response. If Owner does not issue any comments, proposed changes or
written approvals or disapprovals within such time periods, Contractor may
proceed with the development of such Drawings and Specifications and any
construction relating thereto, and such lack of Owner response shall be treated
as an approval of the Drawings and Specifications in accordance with the terms
of Section 3.3C.6

5. Disapproval by Owner. In the event that Owner disapproves the Drawings or
Specifications, Owner shall provide Contractor with a written statement of the
reasons for such rejection within the time period required for Owner’s response
for disapproval of Drawings and Specifications. Contractor shall provide Owner
with revised and corrected Drawings and Specifications as soon as possible
thereafter and Owner’s rights with respect to the issuing of comments, proposed
changes or approvals or disapprovals of such revised and corrected Drawings or
Specifications are governed by the procedures specified above in this
Section 3.3C; provided that Contractor shall not be entitled to any extensions
of time to the Key Milestone Schedule, Guaranteed Substantial Completion Date or
Required Final Completion Date, an adjustment to the Contract Price or any
adjustment to any other Changed Criteria.

6. Approval by Owner. Upon Owner’s written approval of the Drawings and
Specifications, such Drawings and Specifications shall be the Drawings and
Specifications that Contractor shall use to construct the Work; provided that
Owner’s review, comment or approval of any Drawings and Specifications shall not
in any way be deemed to limit or in any way alter Contractor’s responsibility to
perform and complete the Work in strict accordance with the requirements of this
Agreement, and in the event that there is a discrepancy, difference or ambiguity
between the terms of this Agreement and any Drawings and Specifications, the
interpretation imposing the greater obligation on Contractor shall control. Due
to the limited time for

 

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Owner’s review of Drawings and Specifications, Contractor’s or its
Subcontractors’ or Sub-subcontractors’ expertise in the Work and Owner’s
reliance on Contractor to prepare accurate and complete Drawings and
Specifications, Contractor recognizes and agrees that Owner is not required or
expected to make detailed reviews of Drawings and Specifications, but instead
Owner’s review of Drawings and Specifications may be of only a general, cursory
nature. Accordingly, any review, comment or approval given by Owner under this
Agreement with respect to any Drawings or Specifications shall not in any way
be, or deemed to be, an approval of any Work, Drawings or Specifications not
meeting the requirements of this Agreement, as Contractor has the sole
responsibility for performing the Work in accordance with this Agreement.

D. Design Licenses. Contractor shall perform all design and engineering Work in
accordance with Applicable Law and Applicable Codes and Standards, and all
Drawings, Specifications and design and engineering Work shall be signed and
stamped by design professionals licensed in accordance with Applicable Law.

E. CAD Drawings. Unless otherwise expressly provided under this Agreement, all
Drawings and Record As-Built Drawings prepared by Contractor or its
Subcontractors or Sub-subcontractors under this Agreement shall be prepared
using computer aided design (“CAD”). All Record As-Built Drawing files shall be
in fully operable and editable AutoCAD.dwg (2005 or later) format; provided,
however, the Drawings (including Record As-Built Drawings) prepared by Siemens
for the Siemens Equipment shall be provided in the formats required under the
Siemens Contract. Contractor shall use commercially reasonable efforts to also
provide Drawings, including Record As-Built Drawings, in other formats requested
by Owner. All Drawings not Record As-Built Drawings shall utilize Microstation
software and shall also be provided in .pdf format.

F. As-Built Drawings and Specifications. During construction, Contractor shall
keep a redlined, marked, up-to-date set of Progress As-Built Drawings and
Specifications on the Site as required under Attachment B. As a condition
precedent to Final Completion, Contractor shall deliver to Owner the Record
As-Built Drawings and Specifications in accordance with Attachment B, which
shall include delivery of final as-built drawing files in fully operable and
editable AutoCAD.dwg (2005 or later) format for Record As-Built Drawings;
provided that the Record As-Built Drawings prepared by Siemens for the Siemens
Equipment shall be provided in the formats required under the Siemens Contract.

G. Other Information. Contractor shall deliver copies of all other documents
required to be delivered pursuant to Attachment B within and in accordance with
the requirements and timing set forth in Attachment B.

3.4 Spare Parts.

 

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A. Commissioning Spare Parts. Prior to Mechanical Completion of the Facility,
Contractor shall deliver to the Site all pre-commissioning, commissioning,
testing and start-up spare parts (but not operating spare parts) necessary to
commission, test and start-up the Facility. The cost associated with all Work
related to such pre-commissioning, commissioning, testing and start-up spare
parts is included in the Contract Price, including the procurement of such spare
parts and the actual purchase price of such spare parts.

B. Operating Spare Parts. Subject to Section 3.4C below, Contractor shall
deliver to Owner, for Owner’s written approval, one or more detailed lists of
all manufacturer and Contractor-recommended spare parts necessary for operating
all Equipment for the Work (including components and systems of such Equipment)
for two (2) years after Substantial Completion. Contractor’s proposed operating
spare parts list(s) shall include the information set forth in Attachment W. The
cost associated with generating the list of such operating spare parts is
included in the Contract Price. Within thirty (30) days after Owner’s receipt of
the operating spare parts list(s) from Contractor identifying the recommended
operating spare parts, Owner shall request, in writing, which operating spare
parts, if any, that it elects Contractor to procure from such list. In the event
Owner requests in writing that Contractor procure any operating spare parts on
Owner’s behalf, Contractor shall be entitled to request a Change Order in
accordance with Section 6.2A.11 to increase the Contract Price for the actual
purchase price of such requested operating spare parts. With the exception of
Critical Spare Parts (which shall be delivered in accordance with
Section 12.4C), any operating spare parts purchased by Owner pursuant to this
Section 3.4 shall be delivered to Owner at the Site no later than ninety
(90) Days after Substantial Completion.

C. Siemens Equipment. Notwithstanding anything to the contrary in Section 3.4B
above, the responsibilities regarding the operating spare parts for the Siemens
Equipment shall be governed by this Section 3.4C. Within sixty (60) Days after
issuance of the GTG LNTP, Contractor shall provide Owner a list of recommended
initial operating spare parts for the gas turbine and turbine generator with
prices included for each such spare part. The cost associated with generating
the list of such Siemens Equipment operating spare parts is included in the
Contract Price. Within sixty (60) Days after Owner’s receipt of the foregoing
list from Contractor, Owner shall identify which of the recommended initial
operating spare parts that Owner desires to purchase under this Agreement. If
Owner elects to purchase any such recommended initial operating spare parts for
the Siemens Equipment, then Contractor shall be entitled to a Change Order for
the agreed upon price of the Owner-requested initial operating spare parts as
allowed under Section 6.2A.11. In addition to the foregoing, Contractor shall
provide Owner with a list of recommended operating spare parts for all other
Siemens Equipment (other than the gas turbine and turbine generator) at or
before the time such Siemens Equipment arrives at the Site, provided that
Contractor shall not be required to procure any such operating spare parts for
the other Siemens Equipment under this Agreement (unless the Parties otherwise
agree pursuant to a Change Order).

3.5 Training Program in General. As part of the Work, a reasonable number of
personnel designated by Owner in its sole discretion (but not to exceed the
number of Persons listed in Attachment V) shall be given training designed and
administered by Contractor at its

 

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expense, which shall be based on the program requirements contained in
Attachment V and shall cover at a minimum the following topics: (i) the testing
of each item of Equipment; (ii) the start-up, operation and shut-down of each
item of Equipment; (iii) the performance of routine, preventative and emergency
maintenance for each item of Equipment; (iv) spare parts to be maintained for
each item of Equipment, and their installation and removal; and (v) control
system operations. Such training shall include instruction for Owner’s
operations personnel in the operation and routine maintenance of each item of
Equipment prior to completion of commissioning of each item of Equipment.
Training shall be provided by personnel selected by Contractor who, in
Contractor’s and the Equipment Subcontractor’s or Sub-subcontractor’s judgment,
are qualified to provide such training, and shall take place at such locations
and at such times as agreed upon by the Parties, but shall occur no earlier than
one (1) year prior to the anticipated date of Substantial Completion and end no
later than forty-five (45) Days prior to the anticipated date of Substantial
Completion. Contractor shall provide trainees with materials described in
Attachment V. Contractor shall also provide to Owner all training materials and
aids developed to conduct such training in order to facilitate future training
by Owner of personnel hired after Substantial Completion; provided, however,
that all such training materials and aids for the Siemens Equipment shall be
limited to those provided under the Siemens Contract.

3.6 Environmental Regulations and Environmental Compliance. Without limitation
of Section 3.1, Contractor is fully responsible for ensuring that the Work is
performed in an environmentally sound manner and in compliance with all
provisions of this Agreement regarding the environment and Applicable Law and in
compliance with the policies and procedures set forth in Attachment J.
Contractor shall maintain all environmental compliance records required by
Applicable Law and shall provide, or cause to be provided, necessary training to
its employees, Subcontractors and Sub-subcontractors to ensure their compliance
with the environmental rules and requirements of the Agreement. Contractor
shall, at its sole cost and expense, dispose of all non-hazardous wastes and
Hazardous Materials generated, brought onto the Site or used during performance
of the Work by Contractor or any of its Subcontractors or Sub-subcontractors at
off-Site disposal facilities approved by Owner and permitted to receive such
wastes and Hazardous Materials. Contractor shall report to Owner, as soon as
reasonably possible after having knowledge thereof and in no event later than
one (1) Day after such occurrence, any violation of the foregoing. Contractor
shall, at its sole cost and expense, remediate the release of any substance or
other event by Contractor or any of its Subcontractors or Sub-subcontractors in
violation of this Section 3.6 and shall repair any damage caused thereby.

3.7 Contractor’s Tools and Equipment. Contractor shall furnish all tools,
machinery, structures, scaffolding and other equipment necessary and appropriate
for the timely and safe completion of the Work in strict compliance with this
Agreement. Notwithstanding anything to the contrary contained in this Agreement,
Contractor shall be responsible for damage to or destruction or loss of, from
any cause whatsoever, all such tools, machinery, structures, scaffolding and
equipment owned, rented or leased by Contractor or its Subcontractors or
Sub-subcontractors for use in accomplishing the Work.

3.8 Employment of Personnel.

A. Contractor agrees to promptly remove (or to require any Subcontractor or
Sub-subcontractor to remove) from the Work any Person who is not skilled or
qualified or

 

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is otherwise unfit to perform the work assigned to such Person. In addition,
Contractor agrees that within forty-eight (48) hours after receipt of written
notice from Owner, it shall remove from the Work any employee or agent of
Contractor or of Contractor’s Subcontractors or Sub-subcontractors who, in
Owner’s reasonable opinion, is unsafe, incompetent, careless, unqualified to
perform the Work assigned to such Person, creates an unsafe or hostile work
environment, disregards the terms and conditions of this Agreement, or is
interrupting, interfering with or impeding the timely and proper completion of
the Work. NOTWITHSTANDING THE FOREGOING, OWNER SHALL HAVE NO LIABILITY AND
CONTRACTOR AGREES TO RELEASE, INDEMNIFY, DEFEND AND HOLD HARMLESS THE OWNER
GROUP FROM AND AGAINST ANY AND ALL CLAIMS, CAUSES OF ACTION, DAMAGES, LOSSES,
COST AND EXPENSES (INCLUDING ALL ATTORNEYS’ FEES AND LITIGATION EXPENSES) AND
LIABILITIES, OF WHATSOEVER KIND OR NATURE, WHICH MAY DIRECTLY OR INDIRECTLY
ARISE OR RESULT FROM CONTRACTOR OR ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR
TERMINATING THE EMPLOYMENT OF OR REMOVING FROM THE WORK ANY SUCH EMPLOYEE WHO
FAILS TO MEET THE FOREGOING REQUIREMENTS FOLLOWING A REQUEST BY OWNER TO HAVE
SUCH EMPLOYEE REMOVED FROM THE WORK. Contractor shall replace any such employee
at its sole cost and expense.

B. Contractor is responsible for complying with the PLA and maintaining labor
relations in such manner that there is harmony among the employees of Contractor
and its on-Site Subcontractors and Sub-subcontractors. Contractor and its
Subcontractors and Sub-subcontractors shall conduct their labor relations in
accordance with the recognized prevailing state and local practices (including
via the PLA) in order to minimize the likelihood or effect of any labor disputes
and ensure an adequate supply of quality labor. Contractor shall inform Owner
promptly of any labor dispute, anticipated labor dispute, request or demand by a
labor organization, its representatives or members which may reasonably be
expected to affect the Work.

C. Contractor and its Subcontractors and Sub-subcontractors and the personnel of
any of them shall not bring onto the Site: (i) any firearm of whatsoever nature
or knife with a blade exceeding four (4) inches (100 millimeters) in length
(unless specifically authorized by Contractor to be used in the performance of
the Work); (ii) alcoholic beverages of any nature; (iii) any substance or object
that creates a hazard and not related to the Work; (iv) any animal (other than
services animals); (v) illegal drugs of any nature; (vi) any drugs (whether
prescription or non-prescription) which impair physical or mental faculties; or
(vii) any prescription drugs without a valid prescription.

In connection with the enforcement of this Section 3.8C, all employees and
agents of Contractor and its Subcontractors and Sub-subcontractors shall
successfully complete a drug screening test prior to performing Work at the Site
and periodically thereafter, and upon Owner’s request, Contactor shall provide
Owner with copies of such drug screening test results (pass/fail). Contractor
and its Subcontractors and Sub-subcontractors shall abide by and enforce the
requirements of this Section 3.8C, and shall immediately remove from the Work
and the Site any employee or agent of Contractor, Subcontractor or
Sub-subcontractor who has violated the requirements of this Section 3.8C. The
provisions of Section 3.8A with regard to liability of any of member of the
Owner Group and

 

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Contractor’s release, indemnification, defense and hold harmless obligations
shall apply to the removal of any such Person under this Section 3.8C.

3.9 Clean-up. Contractor shall, to Owner’s reasonable satisfaction, at all times
keep the Site free from all waste materials or rubbish caused by the activities
of Contractor or any of its Subcontractors or Sub-subcontractors. Without
limitation of the foregoing or limiting Contractor’s obligations, Contractor
shall clean up all such waste materials or rubbish at Owner’s request with
reasonable notice. As soon as practicable after the completion of all Punchlist
items, Contractor shall remove, at its own cost, all of its equipment, materials
and other items not constituting part of the Facility and remove all waste
material and rubbish from the Site and restore the Site in accordance with this
Agreement. In the event of Contractor’s failure to comply with any of the
foregoing, Owner may, after ten (10) Days written notice to Contractor and
opportunity to cure, accomplish the same; provided, however, that Contractor
shall be liable for and pay to Owner (directly or by offset, at Owner’s sole
option) all costs associated with such removal and/or restoration, including
costs associated with permitting, transportation and disposal at an authorized
location.

3.10 Safety and Security. Contractor recognizes and agrees that safety and
physical security are of paramount importance in the performance of the Work and
that Contractor is responsible for performing the Work in a safe and physically
secure manner. Contractor agrees to implement a safety program that is to be
received by Owner for its written approval ten (10) Days prior to the
commencement of the Work at the Site. Contractor further agrees to perform the
Work in accordance with the safety and health rules and standards of Applicable
Law (including OSHA) and such safety program, as approved by Owner, and
Contractor shall assume all costs associated with compliance therewith.
Contractor’s safety program shall include the standards set forth in Attachment
J. Owner’s review and approval of Contractor’s safety program shall not in any
way relieve Contractor of its responsibility regarding safety, and Owner, in
reviewing and approving such safety program, assumes no liability for such
safety program. Contractor shall appoint one or more (as appropriate) safety
representative(s) acceptable to Owner who shall be resident at the Site, have
responsibility to immediately correct unsafe conditions or unsafe acts
associated with the Work and the Facility, act on behalf of Contractor on safety
and health matters, and participate in periodic safety meetings with Owner at
least once per week after Work has commenced on the Site. Contractor further
agrees to provide or cause to be provided necessary training and safety
equipment to its employees, Subcontractors and Sub-subcontractors to ensure
their compliance with the foregoing safety and health rules and standards and
enforce the use of such training and equipment. Contractor shall maintain all
accident, injury and any other records required by Applicable Law or by Owner
and shall furnish Owner a Monthly summary of injuries and labor hours lost due
to injuries. Should Owner at any time observe Contractor, or any of its
Subcontractors or Sub-subcontractors, performing the Work in an unsafe manner,
or in a manner that may, if continued, become unsafe, then Owner shall have the
right (but not the obligation) to require Contractor to stop the Work until such
time as the manner of performing the Work has been rendered safe to the
satisfaction of Owner; provided, however, that at no time shall Contractor be
entitled to an adjustment of the Contract Price, Key Milestone Schedule,
Guaranteed Substantial Completion Date or Required Final Completion Date based
on such work stoppage. Contractor shall be responsible for the security,
fencing, guarding, lighting, and supervision of the Facility and Site until all
of the requirements of Substantial Completion have been satisfied. Nothing in
this Section 3.10 shall affect Contractor’s status as an independent contractor.

 

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3.11 Emergencies. In the event of any emergency endangering life or property in
any way relating to the Work, the Facility or the Site, whether on the Site or
otherwise, Contractor shall take such action as may be reasonable and necessary
to prevent, avoid or mitigate injury, damage, or loss and shall, as soon as
possible, report any such incidents, including Contractor’s response thereto, to
Owner. If Contractor has not taken reasonable precautions for the safety of the
public or the protection of the Work, and such failure creates an emergency
requiring immediate action, then Owner, with or without notice to Contractor
may, but shall be under no obligation to, take reasonable action as required to
address such emergency. The taking of any such action by Owner, or Owner’s
failure to take any action, shall not limit Contractor’s liability. Contractor
shall reimburse Owner for the performance of any work or furnishing of any
equipment or other items in connection with any emergency in an amount equal to
the reasonable costs incurred by Owner in such performance of work or furnishing
of equipment or other items.

3.12 Approvals, Certificates, Permits and Licenses. Contractor shall obtain
those Permits listed in Attachment P as well as any other Permits required by
Applicable Law to be procured in Contractor’s name. Contractor shall provide
Owner with copies of such Permits promptly after they are obtained. Contractor
shall provide information, assistance and documentation to Owner as reasonably
requested in connection with the Permits to be obtained by Owner under
Section 4.2.

3.13 Books, Records and Audits.

A. Contractor shall keep full and detailed books, construction and manufacturing
logs, records, daily reports, accounts, schedules, payroll records, receipts,
statements, electronic files, correspondence and other pertinent documents as
may be necessary for proper management under this Agreement or as required under
Applicable Law or this Agreement, and in any way relating to this Agreement
(“Books and Records”). Contractor shall maintain all such Books and Records in
accordance with generally accepted accounting principles applicable in the
United States and shall retain all such Books and Records for a minimum period
of three (3) years after Final Completion, or such greater period of time as may
be required under Applicable Law.

B. Upon reasonable notice, Owner, Lender, and any of their representatives,
including Lender’s independent engineer, shall have the right to audit or to
have audited Contractor’s Books and Records (including all amounts billed under
Owner-directed Change Orders executed in accordance with this Agreement);
provided, however, that such parties shall not have the right to audit or have
audited Contractor’s Books and Records in connection with the internal
composition of any compensation that is fixed in amount hereunder, except to the
extent that any such compensation is reasonably necessary to evaluate any claims
brought by Contractor for extra compensation or schedule relief and such claims
depend in whole or in part on the internal composition of any such fixed amounts
or has any reasonable bearing with respect to: (i) any proceeding (including any
civil, criminal or administrative proceeding or investigation) before any
Governmental Instrumentality in which Owner is involved, (ii) any litigation
brought by third parties against Owner and such internal composition of any
fixed amounts is in Owner’s reasonable opinion necessary to defend against such
litigation, or (iii) regulatory compliance, standards or demands. When requested
by Owner, Contractor shall provide

 

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the auditors with reasonable access to all such Books and Records, and
Contractor’s personnel shall cooperate with the auditors to effectuate the audit
or audits hereunder. The auditors shall have the right to copy all such Books
and Records. Contractor shall bear at its own cost and expense all costs
incurred by it in reasonably assisting Owner with audits performed pursuant to
this Section 3.13. The restrictions in this Section 3.13B to the audit rights of
Owner, Lender or Lender’s independent engineer shall not control over any rights
such parties have under Applicable Law, in discovery in any litigation arising
out of Article 19.

3.14 Tax Accounting. Within a reasonable period of time following a request
therefor, Contractor shall provide Owner with any information regarding
quantities, descriptions and costs of any Equipment installed on or ordered for
the Facility and any other information, including Books and Records, as Owner
may deem reasonably necessary in connection with the preparation of its tax
returns or other tax documentation.

3.15 Temporary Utilities, Roads, Facilities and Storage. Owner shall provide
Contractor with a connection to the City of Antioch water supply near the Site
for use by Contractor as construction water during the performance of the Work,
and Owner shall pay for the reasonable use of such water by Contractor. In
addition, Owner shall provide Contractor with an interconnection for electrical
power near the Site for use by Contractor as construction power during the
performance of the Work, and Owner shall pay for the reasonable use of such
electricity by Contractor. Contractor shall provide and pay for all other
temporary utilities (e.g., telecommunications, cable, waste and sanitary),
including all connections, necessary for the performance of the Work, including
installation, Permit and usage costs; provided, however, in addition to Owner’s
obligations set forth by the first two sentences of this Section 3.15, Owner
shall also be responsible for (i) the fuel and power costs as set forth under
Section 4.7 and (ii) any utility or interconnection-related system studies.
Notwithstanding Owner’s obligations with respect to construction water and
construction power as set forth in this Section 3.15, Contractor shall provide
and pay for the distribution of electrical power and water within the Site as
well as any bottled water used during the performance of the Work. Contractor
shall construct and maintain temporary access and haul roads as may be necessary
for the proper performance of this Agreement. Roads constructed on the Site
shall be subject to Owner’s approval (such approval not to be unreasonably
withheld). Contractor shall provide Owner with sufficient office space at the
time of Contractor’s mobilization at the Site to accommodate Owner’s Site
representatives, Lenders’ representatives and support staff. Contractor shall
provide Owner with all office space, construction trailers, utilities, storage
and warehousing, security, telephones, furnishings, and other temporary
facilities required for their oversight of the Work, as set forth in more detail
in Attachment A. All Equipment stored at a location other than on the Site shall
be segregated from other goods, and shall be clearly marked as “Property of
Mirant Marsh Landing, LLC.”

3.16 Subordination of Liens. In consideration of ten and no/100 U.S. Dollars
(U.S.$10) incorporated into the Contract Price and as part of the consideration
of receiving this Agreement and other valuable consideration received and
acknowledged by Contractor, Contractor hereby subordinates any mechanics’ and
materialmen’s liens or other claims or encumbrances that may be brought by
Contractor against any or all of the Work, the Site or the Facility to any liens
granted in favor of Lender, whether such lien in favor of Lender is created,
attached or perfected prior to or after any such liens, claims or encumbrances,
and shall require its

 

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Subcontractors to similarly subordinate their lien, claim and encumbrance
rights. Contractor agrees to comply with reasonable requests of Owner for
supporting documentation required by Lender, including any necessary lien
subordination agreements, affidavits or other documents that may be required to
demonstrate that Owner’s property and premises are free from liens, claims and
encumbrances arising out of the furnishing of Work under this Agreement.

3.17 Hazardous Materials. Contractor shall not, nor shall it permit or allow any
Subcontractor or Sub-subcontractor to, bring any Hazardous Materials on the Site
and shall bear all responsibility and liability for such materials; provided,
however, that Contractor may bring onto the Site such Hazardous Materials as are
necessary to perform the Work so long as the same is done in compliance with
Applicable Law, Applicable Codes and Standards, and the requirements specified
in Attachment J, and Contractor shall remain responsible and liable for all such
Hazardous Materials. If Contractor or any Subcontractor or Sub-subcontractor
encounter pre-existing Hazardous Materials at the Site, and Contractor or any
Subcontractor or Sub-subcontractor knows or reasonably should know that such
material is Hazardous Material, Contractor and its Subcontractors and
Sub-subcontractors shall immediately stop Work in the affected area and notify
Owner. If under such circumstances Contractor or any of its Subcontractors or
Sub-subcontractors fail to stop Work and notify Owner and through its negligent
action exacerbate the circumstances of such pre-existing Hazardous Material,
Contractor shall be responsible and liable to Owner in accordance with
Section 18.1C for all damages, costs, losses and expenses to the extent relating
to such failure.

3.18 Quality Assurance. No later than thirty (30) Days after the date Owner
issues NTP, Contractor shall submit to Owner for its review and written
approval, a Work-specific quality control and quality assurance plan and an
inspection plan, including witness points, shop inspections and shop tests
(including those inspections, tests and witness points provided under the
Siemens Contract for the Siemens Equipment). No later than sixty (60) Days after
the date Owner issues NTP, Contractor shall submit to Owner for its written
approval, detailed inspection procedures. Contractor’s quality control and
quality assurance plan and inspection plan shall be substantially similar to ISO
9001:2000; provided that Contractor is not required to maintain an ISO 9001:2000
certification. Contractor’s quality control and quality assurance plan shall
provide for a quality control and quality assurance individual to be present at
the Site to supervise the implementation of the quality control and quality
assurance plan, the inspection plan, and the inspection procedures. Owner’s
review and approval of Contractor’s quality control and quality assurance plan,
inspection plan and inspection procedures shall in no way relieve Contractor of
its responsibility for performing the Work in compliance with this Agreement. As
part of the quality control and quality assurance plan, inspection plan and
inspection procedures, Contractor shall keep a log of inspections performed, and
Contractor shall make available at the Site for Owner’s review a copy of all
such inspections.

3.19 Reports and Meetings.

A. Reports. Contractor shall provide Owner with four (4) hardcopies and one
(1) electronic copy of progress reports and such other information as reasonably
requested by Owner, including the following:

 

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1. minutes for all status and other Work-related meetings within five
(5) Business Days following such meeting;

2. safety or environmental incident reports within twenty-four (24) hours after
the occurrence of any such incident (including “near miss” incidents where no
individual was injured or property was damaged), except for any safety or
environmental incident involving a significant non-scheduled event such as
natural gas releases, fires, explosions, mechanical failures, unusual
over-pressurizations or major injuries which shall be provided to Owner within
eight (8) hours of the occurrence of such incident; provided, however,
notification shall be provided to Owner immediately if any safety or
environmental incident threatens public or employee safety, causes significant
property damage, or interrupts the Work;

3. weekly (or such duration as otherwise agreed by Owner in writing) progress
reports (“Weekly Progress Reports”), in a form substantially similar to that set
forth in Attachment X for Weekly Progress Reports (and meeting the criteria set
forth in such Attachment X for Weekly Progress Reports), which shall be provided
two (2) Days prior to the weekly progress meeting and shall cover all activities
up to the end of the previous week; and

4. Monthly progress reports (“Monthly Progress Reports”), in a form
substantially similar to that set forth in Attachment X for Monthly Progress
Reports (and meeting the criteria set forth in such Attachment X for Monthly
Progress Reports). Contractor shall provide the Monthly Progress Report no later
than five (5) Days after the end of each Month, which shall cover activities up
through the end of the previous Month. Contractor shall arrange for the
distribution of the Monthly Progress Reports as Owner may reasonably request.

B. Meetings.

1. Contractor shall hold weekly progress meetings with applicable Subcontractors
and Sub-subcontractors and will discuss the matters described in the Weekly
Progress Report for the prior week. Contractor shall provide Owner with the
date, time and location for each such meeting and the agenda for each such
meeting and, to the extent reasonably possible, such meetings shall be held at
the same time and place each week. Owner shall have the right, at its sole
discretion, to attend, and have the Lenders’ representatives to attend, any or
all weekly progress meetings held by Contractor. In addition to the attendees
required by Contractor, the meetings shall be attended by those Contractor
employees, Subcontractors and Sub-subcontractors reasonably requested by Owner.

2. A Monthly progress meeting shall be held by Contractor at the Site, or at an
alternate site mutually agreeable to Owner and Contractor, to discuss the
matters described in Attachment X for the prior Month and to review the

 

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Monthly Progress Report for that Month with Owner and, at Owner’s sole
discretion, the Lenders’ representatives. In addition to any other attendees
required by Contractor, the meetings shall be attended by those Contractor
employees, Subcontractors and Sub-subcontractors reasonably requested by Owner.

3. In addition to the Monthly progress meeting set forth in Section 3.19B.2,
Contractor’s and Owner’s senior executives (including the Owner Representative
and Contractor Representative), and if requested by Owner, the Lenders’
representatives, shall meet on a Monthly basis (at a mutually agreeable time and
location) to review the progress of the Work and discuss any safety, schedule,
Work or Subcontractor issues.

3.20 Payment. Contractor shall timely make all payments required to be paid to
Owner pursuant to the terms of this Agreement.

3.21 Commercial Activities. Neither Contractor nor its employees shall establish
any commercial activity or issue concessions or permits of any kind to third
parties for establishing commercial activities on the Site or any other lands
owned or controlled by Owner.

3.22 Title to Materials Found. As between Owner and Contractor, the title to
water, soil, rock, gravel, sand, minerals, timber, and any other materials
developed or obtained in the excavation or other operations of Contractor, any
Subcontractor or Sub-subcontractor and the right to use said materials or
dispose of same is hereby expressly reserved by Owner. Contractor may, at the
sole discretion of Owner, be permitted, without charge, to use in the Work any
such materials that comply with the requirements of this Agreement.

3.23 Survey Control Points and Layout. Contractor shall establish all survey
control points and layout the entire Work in accordance with the requirements of
this Agreement, which shall be based on the survey control point established by
Owner pursuant to Section 4.6. Contractor shall confirm the proper placement of
such Owner-provided survey control point. If Contractor or any of its
Subcontractors, Sub-subcontractors or any of the representatives or employees of
any of them move or destroy or render inaccurate the survey control point
provided by Owner pursuant to Section 4.6, such control point shall be replaced
by Contractor at Contractor’s own expense and Contractor shall be liable to
Owner for all other damages, costs, losses and expenses arising out of such
relocation or destruction.

3.24 Cooperation with Others.

A. Subject to the provisions of this Agreement, including Section 4.3,
Contractor acknowledges that Owner, other contractors and other subcontractors
or other Persons may be working at or near the Site during the performance of
this Agreement, that the Site is near the location of the Mirant Delta Facility
which may be operating during the performance of Work at the Site and the Work
or use by Contractor of certain facilities may be interfered with as a result of
such concurrent activities. Contractor agrees to coordinate the performance of
its Work at the Site with the operation and maintenance of the Mirant

 

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Delta Facility or other Persons activities at or near the Site so as not to
interfere with such operations or other Persons performing work at or near the
Site.

B. It is the Parties’ intent that the performance of the Work and Contractor’s
other obligations under this Agreement will not interfere with the operation of
the Mirant Delta Facility, and Contractor shall use its best efforts to
coordinate the performance of the Work at the Site with the operation and
maintenance of the Mirant Delta Facility so as not to interfere with such
operation and maintenance. During the performance of the Work, should a
situation arise that has the potential of interfering with the operation of the
Mirant Delta Facility, Contractor shall give Owner written notice as soon as
possible but no later than seven (7) Days prior to the time that Contractor
plans to perform such Work, detailing a plan that describes how such Work will
be performed to minimize, to the greatest extent possible, interference with the
operation of the Mirant Delta Facility. The plan proposed by Contractor shall be
the least disruptive to operations of the Mirant Delta Facility;. Prior to the
execution of such Work, Owner, in its discretion (not to be unreasonably
withheld), shall approve or disapprove of such plan; provided, however if the
agreed upon plan delays pile driving activities which are on the critical path
of the CPM Performance Measurement Baseline Schedule or materially increases the
costs of such pile driving activities, then Contractor shall be entitled to a
Change Order in accordance with Section 6.8.

3.25 Responsibility for Property. Contractor shall plan and conduct its
operations so that neither Contractor nor any of its Subcontractors or
Sub-subcontractors shall (i) enter upon lands (other than the Site) or
waterbodies in their natural state unless authorized by Owner in writing;
(ii) close or obstruct any utility installation, highway, waterway, harbor, road
or other property unless and until Permits and Owner’s permission therefore have
been obtained; (iii) disrupt or otherwise interfere with the operation of any
portion of any pipeline, telephone, conduit or electric transmission line,
ditch, navigational aid, dock or structure unless otherwise specifically
authorized by Owner in writing; (iv) damage any property listed in (ii) or
(iii); and (v) damage or destroy maintained, cultivated or planted areas or
vegetation such as trees, plants, shrubs, shore protection, paving, or grass on
or adjacent to the premises which, as determined by Owner, do not interfere with
the performance of this Agreement. The foregoing includes damage arising from
performance of the Work through operation of equipment or stockpiling of
materials. Contractor shall be fully responsible for all damages, losses, costs
and expenses arising out of damage to the Site and shall promptly restore at its
own cost and expense the Site to the condition it was in before such damage.
Contractor and its Subcontractors and Sub-subcontractors shall coordinate and
conduct the performance of the Work so as to not interfere with or disrupt the
use and peaceful enjoyment of any adjacent property to the Site.

3.26 Explosives. Explosives shall be transported to the Site only when required
to perform the Work under this Agreement and with abundant, prior notice to and
written approval of Owner. Contractor shall be responsible for properly
purchasing, transporting, storing, safeguarding, handling and using explosives
required to perform the Work under this Agreement. Contractor shall employ
competent and qualified personnel for the use of explosives and shall assume
full responsibility for all costs, losses, damages and expenses caused by the
use of explosives. Residual surplus explosives shall be promptly removed from
the Site and properly disposed of by Contractor. Contractor shall strictly
comply with Applicable Law and Applicable Codes and Standards in the handling of
explosives pursuant to this Agreement, shall perform all

 

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obligations and obtain all Permits with respect to explosives, and shall develop
and file and provide copies to Owner of all documentation regarding same.

3.27 Nondiscrimination. Contractor agrees that it shall conduct its activities
without regard to race, religion, color, sex, gender identity, sexual
orientation, national origin, ancestry, citizenship status, uniform service
member status, marital status, pregnancy, age, protected medical condition,
disability or any other protected status in accordance with all applicable
federal, state and local laws.

3.28 Used or Salvaged Materials. If, after Substantial Completion and prior to
Final Completion, Contractor has any Equipment that it purchased for the
Facility but did not incorporate into the Facility, Owner has the option of
either taking such Equipment at a reasonable, market-based cost to Owner or
requiring that Contractor haul off such Equipment at Contractor’s own cost and
expense; provided, however, if such Equipment was provided by Contractor as part
of any Work performed on a time and materials basis, then Owner shall have the
right to take such Equipment without paying any further cost to Contractor.
Notwithstanding the foregoing, all commissioning spare parts and, to the extent
purchased by Owner, operating spare parts shall be the property of Owner.

3.29 Supervision of Owner’s Operation Personnel. Until Substantial Completion,
Owner’s operating and maintenance personnel shall be under the control of and
supervised by Contractor. To the extent not set forth in Attachment V,
Contractor shall, no later than one hundred eighty (180) Days prior to the
Guaranteed Substantial Completion Date, prepare for Owner’s review a proposed
plan regarding the utilization of Owner’s operation and maintenance personnel
and Contractor’s personnel during commissioning and for the conduct of
Performance Tests and any other tests. Such plan shall be mutually agreed-upon
by the Parties no later than forty-five (45) Days after Owner’s receipt of
Contractor’s proposed plan. Without in any way limiting Contractor’s obligation
to provide forces and labor during commissioning and Performance Testing,
Contractor agrees that if any activity requires direct supervision by
Contractor, such activity shall be performed by Contractor or a Subcontractor or
Sub-subcontractor. Nothing in this Agreement, including this Section 3.29 or
Section 3.2G, shall be interpreted to create a master-servant or principal-agent
relationship between Contractor and any of Owner’s operation or maintenance
personnel.

3.30 Compliance with Real Property Interests. Contractor shall, in the
performance of the Work, comply, and cause all Subcontractors and
Sub-subcontractors to comply, with any easement, lease, right-of-way or other
property interests that affect or govern the Site or any other real property
used for the purposes of completing the Work.

3.31 Compliance with Site Rules. Contractor shall, in the performance of the
Work, comply, and cause all Subcontractors and Sub-subcontractors to comply,
with any applicable safety, security, and similar work-related policies,
procedures, controls and rules which are applicable to the Site, including those
imposed by Owner, PG&E, the North American Electric Reliability Corporation, the
Western Electricity Coordinating Council or the Federal Energy Regulatory
Commission and any Site access rules and procedures.

 

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ARTICLE 4

OWNER’S RESPONSIBILITIES

Owner shall comply with the following provisions in a timely manner:

4.1 Payment. Owner shall timely pay the Contract Price in accordance with the
provisions of Article 7 hereof.

4.2 Permits. Owner shall be responsible for obtaining the Permits listed in
Attachment Q and any other Permits required to be procured in Owner’s name under
Applicable Law. Owner shall provide Contractor with copies of such Permits
within ten (10) Business Days after obtaining them. Owner shall provide
information, assistance and documentation to Contractor as reasonably requested
in connection with the Permits to be obtained by Contractor under this
Agreement.

4.3 Site Access. Owner shall secure and maintain at its expense all real
property rights for the Site, and Owner shall provide Contractor with reasonably
unrestricted access on the Site for Contractor to perform the Work. Subject to
Section 3.24, such access shall be sufficient to permit Contractor to progress
with construction on a continuous basis without substantial interruption or
interference and shall otherwise be in accordance with the Site access plan to
be developed and agreed upon by the Parties prior to Contractor’s mobilization
to the Site.

4.4 Operation Personnel. As further set forth in Attachment V, Owner, at its
cost, will provide a sufficient number of qualified operating and maintenance
personnel and technicians in a sufficient number to be trained by Contractor and
to assist Contractor by performing normal operating and maintenance duties in
connection with the start-up of the Facility and the performance of the
Performance Tests. Until Substantial Completion, such personnel shall be under
the control of and supervised by Contractor in accordance with Section 3.29.
Contractor shall be fully responsible for the supervision, direction and
instruction of all Owner-provided personnel and shall be liable, and shall
indemnify, defend and hold the Owner Group harmless, for all acts or omissions
of such Owner personnel to the extent under Contractor’s supervision and
direction; provided, however, Contractor shall not be liable to Owner, and shall
not be required to indemnify, defend or hold the Owner Group harmless for claims
related to Owner personnel’s gross negligence or willful misconduct or Owner’s
personnel’s failure to comply with Contractor’s Site-specific, written
directions or procedures (which are consistent with GECP and a safe working
environment) applicable to the tasks being performed by such Owner personnel
(including lock-out/tag-out procedures, de-energizing procedures and other
applicable safety procedures, operating manuals, maintenance manuals and
commissioning and startup procedures); provided further, however,
notwithstanding the foregoing, such Owner’s personnel shall remain employees or
agents of Owner and shall not be considered employees of Contractor for any
reason. If any operating and maintenance personnel under the supervision,
direction and instruction of Contractor as provided in this Section 4.4 do not
follow Contractor’s verbal or written instructions and such instructions are
given in accordance with GECP and are consistent with a safe working
environment, Contractor shall have the right to require Owner to immediately
remove such personnel from the operating and maintenance duties for which
Owner’s operating and maintenance personnel are being provided in accordance
with this Section 4.4.

 

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4.5 Taxes. Owner shall reimburse Contractor for California sales and use Taxes
as set forth in Article 8. In addition, Owner shall administer and pay
(a) property Taxes assessed on the Site, and on Equipment after delivery at the
Site (and passage of title to Owner in accordance with Section 9.1), and (b) all
Taxes incurred due to Owner’s sale of electricity from the Facility.

4.6 Legal Description and Survey. Owner shall provide to Contractor for
Contractor’s information a legal description of the Site and a survey of the
Site showing the boundaries of the Site and one (1) survey control point, the
proper placement of which Contractor will confirm as set forth in Section 3.23.

4.7 Fuel and Power. Owner shall, at no cost to Contractor, provide (i) natural
gas at the gas delivery point near the Site meeting or exceeding typical
pipeline quality specifications and within the temperature and pressure ranges
set forth in Attachment S and (ii) testing power (including back-feed power) for
the Facility at the times designated for commissioning and startup of the
Facility and conducting the Performance Tests; provided, however, Contractor
shall nominate to Owner in writing the natural gas fuel it will require for
commissioning, start-up and testing of the Facility at least ten (10) Days in
advance of the date upon which such natural gas fuel is required. In addition,
Owner shall, at no cost to Contractor, make arrangements to accept the power
generated from the Facility during the Performance Tests.

4.8 Utility and Interconnection Studies. Owner shall be responsible for
conducting and paying for all utility and interconnection-related system
studies.

ARTICLE 5

COMMENCEMENT OF WORK, KEY MILESTONE SCHEDULE, AND SCHEDULING OBLIGATIONS

5.1 Commencement of Work. Upon Contractor’s receipt from Owner of an LNTP or
NTP, Contractor shall immediately commence with the performance of the Work
specified in such LNTP or NTP.

5.2 Limited Notice to Proceed/Notice to Proceed.

A. Limited Notice to Proceed. At any time prior to the date of issuance of the
NTP, Owner may issue an LNTP which shall authorize Contractor to commence
performance of a specified portion of the Work. An LNTP shall specify the
maximum total cost of such specified Work, and Contractor shall be paid for such
specified Work pursuant to the terms and conditions of this Agreement, with all
such payments credited against the Contract Price and the first payments to
become due hereunder. The LNTP shall be issued in the form attached hereto as
Schedule H-1.

B. Limited Notices to Proceed for Siemens. At least thirty (30) Days prior to
Owner’s issuance of the GTG LNTP (described below), Owner shall issue to
Contractor an LNTP directing Contractor to (i) issue a limited notice to proceed
to Siemens under the Siemens Contract so that Siemens can perform certain
preliminary engineering work (as contemplated in Section 11.1.1 of the Siemens
Contract) for timely delivery of certain document packages pursuant to Appendix
6 of the Siemens Contract and (ii) commence engineering oversight and project
management activities related to Siemens’ work in

 

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clause (i) above (collectively, the “Preliminary Engineering LNTP”). Thereafter,
and in accordance with the timing requirements established by the Siemens
Contract for issuance of full notice to proceed to Siemens under such Siemens
Contract, Owner shall issue a LNTP to Contractor directing Contractor to issue a
full notice to proceed to Siemens pursuant to the Siemens Contract (such limited
notice to proceed issued by Owner to Contractor being the “GTG LNTP”). If Owner
fails to issue the GTG LNTP or the Preliminary Engineering LNTP within the time
periods established by this Section 5.2B, and as a result thereof Contractor is
unable to issue the corresponding limited notice to proceed and full notice to
proceed (respectively) to Siemens within the time allowed under the Siemens
Contract, then Contractor shall be entitled to an increase to the Contract Price
and an extension to the Key Milestone Schedule, Guaranteed Substantial
Completion Date and Required Final Completion Date by Change Order if and to the
extent Siemens is allowed a change to its contract price or schedule under the
Siemens Contract; provided that Contractor complies with the Change Order
request, notice and mitigation requirements in this Agreement. Notwithstanding
anything to the contrary herein, other than payments corresponding to Work
performed by Siemens pursuant to the Preliminary Engineering LNTP, Owner shall
not be obligated to make any payments to Contractor under this Agreement that
correspond to payments to be made by Contractor under the Siemens Contract until
Siemens provides a letter of credit to Contractor meeting the requirements set
forth in the Siemens Contract.

C. Release for Engineering LNTP. Owner shall issue to Contractor a limited
notice to proceed with all remaining engineering Work (including applicable
engineering oversight functions) (“Release for Engineering LNTP”) no later than
***. If Owner fails to provide the Release for Engineering LNTP by the foregoing
date (or such other date as the Parties may agree upon in writing), then
Contractor shall be entitled to a Change Order for the delay associated with
such failure in accordance with Section 6.8.

D. Demolition LNTP. Owner shall issue to Contractor a limited notice to proceed
with demolition work and the relocation of certain utilities (“Demolition LNTP”)
no later than ***. After issuance of the Demolition LNTP, Contractor shall be
responsible for the demolition of existing structures at the Site as further set
forth in Attachments A and AA. As part of the demolition Work, Contractor shall
coordinate with Owner, the Owner-provided environmental remediation contractor
and any PG&E representatives involved in remediation efforts to ensure the
efficient performance of the demolition Work and any remediation efforts
necessary to remediate Hazardous Materials associated with the demolition Work.
In addition, Contractor shall also be entitled to a Change Order (to the extent
allowed under Article 6) for an adjustment to the Contract Price, Key Milestone
Schedule, Guaranteed Substantial Completion Date and Required Final Completion
Date to the extent the actual demolition Work to be performed by Contractor
materially differs from the information provided in this Agreement or that
information that Contractor gathered, or should have gathered, through a visual
investigation (using GECP) of the above ground structures to be demolished. In
addition, to the extent Owner (or its environmental remediation contractor)
fails to timely perform its remediation obligations in accordance with the
schedule allowance for such work set out in the Monthly Updated CPM Schedule,
Contractor shall be entitled to a Change Order for the delay associated with
such failure in accordance with Section 6.8; provided, however, if such failure
is due to an

 

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event of Force Majeure, Contractor shall be entitled to a Change Order for such
delay in accordance with Section 6.7.

E. Notice to Proceed. Unless otherwise specifically set forth in an LNTP,
Contractor shall not commence performance of the Work until Owner issues the NTP
authorizing the same pursuant to the terms and conditions of this Agreement.
Upon Contractor’s receipt from Owner of the NTP, Contractor shall immediately
commence with the performance of the Work specified in such NTP. The NTP shall
be issued in the form attached hereto as Schedule H-2.

F. Delay in Issuance of Notice to Proceed. If Owner fails to issue NTP by ***,
Contractor shall be entitled to an increase to the Contract Price and an
extension to the Key Milestone Schedule, Guaranteed Substantial Completion Date
and Required Final Completion Date, as applicable, by Change Order if and to the
extent Contractor can demonstrate to Owner that receiving the NTP after such
date (as compared to on or before such date) has resulted in increased time of
performance or costs, on a per-unit basis, for the Work; provided that
Contractor complies with the Change Order request, notice and mitigation
requirements in Article 6. Conversely, if Owner has not issued NTP by ***, Owner
shall be entitled to a decrease to the Contract Price by Change Order if and to
the extent it can be demonstrated that receiving the NTP after such date (as
compared to on or before such date) has resulted in lower costs, on a per-unit
basis, for the Work. Contractor shall use commercially reasonable efforts to
assist Owner in identifying lower prices or rates available to Contractor as a
result of NTP being issued after *** which would allow a decrease to the
Contract Price. The change, if any, in per-unit prices shall be evidenced by
Contractor through competitive re-bidding of the per-unit price for the work
near the time of issuance of NTP. For the avoidance of doubt, any adjustment to
the Contract Price, Key Milestone Schedule, Guaranteed Substantial Completion
Date or Required Final Completion Date shall not be based upon a change in
quantity of materials or equipment or the amount of labor, engineering or field
in-directs.

5.3 Key Milestone Schedule, Guaranteed Substantial Completion Date and Required
Final Completion Date. Contractor shall perform the Work in accordance with the
Key Milestone Schedule, Guaranteed Substantial Completion Date and Required
Final Completion date set forth in this Section 5.3 and in Attachment E.

A. Key Milestone Schedule. The Key Milestone Dates set forth in the Key
Milestone Schedule may only be adjusted by Change Order. Contractor shall be
entitled to request a Change Order (which acceptance of such Change Order shall
not be unreasonably withheld by Owner and will be subject to the limitations
referenced in Section 22.20) in order for Contractor, using GECP, to re-sequence
the Work and adjust Key Milestone Dates to improve schedule, efficiency and
resource allocation; provided that such changes to the Key Milestone Schedule
shall not adjust the Guaranteed Substantial Completion Date. Any Change Order
that sets forth an adjustment to any Key Milestone Date or a re-sequencing of
the Work pursuant to this Section 5.3A shall also set forth the corresponding
update to the CPM Performance Measurement Baseline Schedule.

 

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B. Guaranteed Substantial Completion Date. Contractor shall achieve Substantial
Completion no later than *** (“Guaranteed Substantial Completion Date”). The
Guaranteed Substantial Completion Date shall only be adjusted by Change Order as
provided under this Agreement.

C. Required Final Completion Date. Contractor shall achieve Final Completion no
later than *** (“Required Final Completion Date”); provided however, the
requirements set out in clauses (ii), (iv) and (vii) of the definition of Final
Completion in Section 1.1 shall be completed by Contractor ***. The Required
Final Completion Date shall only be adjusted by Change Order as provided under
this Agreement.

5.4 CPM Schedule.

A. CPM Schedule Submission. Within sixty (60) Days after issuance of the GTG
LNTP, Contractor shall prepare and submit to Owner for its review a preliminary
critical path method schedule for the Work using Oracle Primavera P6 and showing
evidence of the preliminary incorporation of the Siemens engineering deliverable
dates within Contractor’s schedule for engineering and construction. Thereafter,
Contractor shall submit a detailed critical path method schedule for the Work,
for Owner’s review and written approval, no later than one hundred twenty
(120) Days after issuance of GTG LNTP which meets the requirements set forth in
Attachment U. This detailed critical path method schedule (as well as, for the
avoidance of doubt, any CPM Performance Measurement Baseline Schedule and
Monthly Updated CPM Schedule) shall adhere to the guidelines set forth in this
Section 5.4, including Attachment U.

B. Owner Review of CPM Schedule. Owner may review the detailed critical path
method schedule, provided within 120 Days after GTG LNTP pursuant to
Section 5.4A, for general conformance with this Agreement, including the Key
Milestone Schedule, Guaranteed Substantial Completion Date and Required Final
Completion Date, and issue written comments, proposed changes and/or written
approval or disapproval of such critical path method schedule. If Owner
reasonably determines that such critical path method schedule does not conform
with this Agreement, in any respect, including the Key Milestone Schedule, the
Guaranteed Substantial Completion Date or the Required Final Completion Date,
Contractor shall revise and resubmit such schedule to Owner within ten
(10) Days. Once the critical path method schedule and the required submittals
have been reviewed and approved by Owner, this version of the critical path
method schedule shall be the baseline critical path method schedule for the Work
(the “CPM Performance Measurement Baseline Schedule”). Owner’s review or
approval of the CPM Performance Measurement Baseline Schedule (or any updates
thereto) shall not relieve Contractor of any obligations for the performance of
the Work nor shall it be construed to establish the reasonableness of the CPM
Performance Measurement Baseline Schedule. Notwithstanding any approval by Owner
of the CPM Performance Measurement Baseline Schedule or any Monthly Updated CPM
Schedule, Owner shall be entitled to reasonably rely upon the CPM Performance
Measurement Baseline Schedule and any Monthly Updated CPM Schedules, including
reliance that Contractor has developed a comprehensive, reasonable and accurate
schedule to plan, organize, direct, coordinate, perform, execute and complete
each portion of the Work within the times set forth by the

 

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Key Milestone Schedule, Guaranteed Substantial Completion Date and Required
Final Completion Date. Contractor shall use the CPM Performance Measurement
Baseline Schedule in planning, organizing, directing, coordinating, performing
and executing the Work, and the CPM Performance Measurement Baseline Schedule
shall be the basis for evaluating progress of the Work.

C. Changes to the CPM Performance Measurement Baseline Schedule. The Contractor
shall maintain the CPM Performance Measurement Baseline Schedule which shall
contain the Key Milestone Schedule, Guaranteed Substantial Completion Date and
Required Final Completion Date (as such dates may be adjusted by Change Order in
accordance with this Agreement) as well as cost loading data corresponding to
the Payment Milestones (as such Payment Milestones may be adjusted by Change
Order in accordance with this Agreement). Notwithstanding anything to the
contrary in this Agreement, the CPM Performance Measurement Baseline Schedule
(including the Key Milestone Schedule, Guaranteed Substantial Completion Date,
Required Final Completion Date as well as the cost loading data corresponding to
the Payment Milestones) shall only be revised by Change Order executed by both
Parties. Within Change Orders executed by the Parties which, due to the nature
of the change, necessitate a corresponding modification of the CPM Performance
Measurement Baseline Schedule, such modification of the CPM Performance
Measurement Baseline Schedule shall be included within such Change Order. This
updated CPM Performance Measurement Baseline Schedule shall thereafter be
included as the comparison baseline with each Monthly Updated CPM Schedule until
the next Change Order (if any) is executed that modifies the CPM Performance
Measurement Baseline Schedule again.

D. Monthly Updates to CPM Schedule. After approval by Owner of the CPM
Performance Measurement Baseline Schedule, Contractor shall manage and update a
critical path method schedule for the Work no less frequently than once per
Month to reflect the actual progress to date (“Monthly Updated CPM Schedule”);
provided, however, this Monthly Updated CPM Schedule shall not modify the CPM
Performance Measurement Baseline Schedule, the Key Milestone Schedule,
Guaranteed Substantial Completion Date or Required Final Completion Date, nor
shall it change any dates that relate to Owner’s obligations under the
Agreement. If Contractor changes the schedule logic, any durations or
cost-loading with respect to any activity in its Monthly Updated CPM Schedule
such that it deviates from the CPM Performance Measurement Baseline Schedule,
Contractor shall provide Owner with a written explanation of each such change
along with such Monthly Updated CPM Schedule (but the CPM Performance
Measurement Baseline Schedule shall not be changed). The Monthly Updated CPM
Schedule shall be statused through the date of the applicable Invoice so that
the Work represented in the Monthly Updated CPM Schedule matches the Payment
Milestones proposed for payment by Contractor in the Invoice. The Monthly
Updated CPM Schedule will have attached to it the current CPM Performance
Measurement Baseline Schedule for comparison. The Monthly Updated CPM Schedule
shall be in the same detail and form as required by the CPM Performance
Measurement Baseline Schedule and shall be submitted by Contractor to Owner with
each Invoice. Contractor shall promptly correct any errors or inconsistencies in
the updates to the Monthly Updated CPM Schedule identified to Contractor by
Owner and resubmit a corrected Monthly Updated CPM Schedule for

 

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Owner’s review. Owner’s review or approval of any Monthly Updated CPM Schedule
shall not relieve Contractor of any obligations for the performance of the Work,
change the Key Milestone Schedule, the Guaranteed Substantial Completion Date or
the Required Final Completion Date, nor shall it be construed to establish the
reasonableness of any Monthly Updated CPM Schedule.

E. Form of Submittals. All submittals by Contractor to Owner of the CPM
Performance Measurement Baseline Schedule and any Monthly Updated CPM Schedule
shall be in both native electronic and paper format. Four (4) hard copies of
each submittal shall be provided to Owner, and one (1) electronic copy shall be
provided to Owner in a mutually agreeable form. The CPM Performance Measurement
Baseline Schedule and Monthly Updated CPM Schedules shall be submitted to Owner
with printed reports meeting the requirements set forth in Attachment X.

5.5 Recovery and Recovery Schedule. If, at any time during the prosecution of
the Work, should (i) the Monthly Updated CPM Schedule or Monthly Progress Report
show that any activity on the critical path of the CPM Performance Measurement
Baseline Schedule is delayed such that completion of any Key Milestone,
Substantial Completion or Final Completion will occur *** Days after the
applicable Key Milestone Date, the Guaranteed Substantial Completion Date or the
Required Final Completion Date, respectively, (ii) (a) Contractor fail to
provide a Monthly Updated CPM Schedule in compliance with the requirements of
this Agreement and (b) Owner notifies Contractor in writing that it has
reasonably determined (based upon objective criteria) that the critical path is
delayed such that completion of any Key Milestone, Substantial Completion or
Final Completion will occur *** Days after the applicable Key Milestone Date,
the Guaranteed Substantial Completion Date or the Required Final Completion
Date, respectively, or (iii) Contractor fail to complete any Key Milestone,
Substantial Completion or Final Completion within *** after the applicable Key
Milestone Date, the Guaranteed Substantial Completion Date or the Required Final
Completion Date, respectively, then Owner may provide Contractor with a written
request for Contractor to prepare a schedule to explain and display how it
intends to complete the future Key Milestones, Substantial Completion and Final
Completion in accordance with the applicable Key Milestone Dates, the Guaranteed
Substantial Completion Date and the Required Final Completion Date (“Recovery
Schedule”) as further set forth in this Section 5.5.

A. Within fifteen (15) Days after receipt of Owner’s written request for
Contractor to develop a Recovery Schedule, Contractor shall prepare the Recovery
Schedule and submit it to Owner for its review. The Recovery Schedule shall
represent Contractor’s best judgment as to how it shall complete the remaining
Key Milestones, Substantial Completion and Final Completion by the applicable
Key Milestone Dates, the Guaranteed Substantial Completion Date and the Required
Final Completion Date, respectively. The Recovery Schedule shall be prepared in
accordance with GECP and to a similar level of detail as the CPM Performance
Measurement Baseline Schedule, and shall be developed for and cover that period
of time reasonably necessary to regain compliance with the Key Milestone
Schedule, the Guaranteed Substantial Completion Date and Required Final
Completion Date using all commercially practicable efforts and diligence
(including, where effective, establishing additional shifts, hiring additional
manpower, working overtime, providing additional equipment, obtaining priority
shipments and re-sequencing activities). Within the Recovery Schedule proposed
by Contractor, and in

 

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accordance with GECP, Contractor may request (which such request shall not be
unreasonably denied by Owner and will be subject to the limitations referenced
in Section 22.20) re-sequencing the Work and adjusting the Key Milestone Dates
to improve schedule, efficiency and resource allocation; provided that such
Recovery Schedule proposal shall not adjust the Guaranteed Substantial
Completion Date; provided further that any requested re-sequencing of the Work
or requested adjustment to any Key Milestone Date shall be expressly stated in
writing by Contractor in a notice to Owner (in addition to being illustrated by
the proposed Recovery Schedule).

B. At Owner’s written request after Contractor’s initial submission of the
Recovery Schedule, Contractor shall participate in a conference with Owner, and
with any other Person, including Subcontractors and Sub-subcontractors, whom
Owner designates to participate, to review and evaluate the Recovery Schedule.
Any revisions necessary as a result of this review shall be resubmitted for
review by Owner within three (3) Business Days after the conference. The revised
Recovery Schedule, once agreed upon by Owner in writing, shall then be the
schedule which Contractor shall use in planning, organizing, directing,
coordinating, performing, and executing the Work (including all activities of
Subcontractors and Sub-subcontractors) to regain compliance with the Key
Milestone Schedule, the Guaranteed Substantial Completion Date and the Required
Final Completion Date. The agreed upon Recovery Schedule, including any changes
to the Key Milestone Dates, shall be incorporated into the CPM Performance
Measurement Baseline Schedule by Change Order; provided that the Guaranteed
Substantial Completion Date shall not be adjusted by such incorporation of the
Recovery Schedule.

C. The cost of preparing and performing in accordance with the Recovery Schedule
shall be for Contractor’s account. Owner’s requirement, review and approval of
the Recovery Schedule shall not relieve Contractor of any obligations for the
performance of the Work, change the Guaranteed Substantial Completion Date or
Required Final Completion Date, or be construed to establish the reasonableness
of the Recovery Schedule.

5.6 Acceleration and Acceleration Schedule. Even if the Work is otherwise in
compliance with the Key Milestone Schedule, the Guaranteed Substantial
Completion Date and the Required Final Completion Date, Owner may, at any time,
direct Contractor by an Owner-directed or mutually agreed Change Order to
accelerate the Work by, among other things, establishing additional shifts,
paying or authorizing overtime, providing additional construction equipment or
expediting Equipment; provided, however, Owner’s direction to Contractor to
accelerate the Work shall be reasonable and in no event shall Owner unilaterally
order acceleration of the Work requiring Contractor to achieve Substantial
Completion or Final Completion prior to the respectively, original Guaranteed
Substantial Completion Date or Required Final Completion Date. In the event of
this directive, Owner’s sole liability shall be to pay to Contractor any
documented costs attributable to such acceleration. Such costs may include any
shift differential, premium, or overtime payments to workers or field
supervisors and other employees of Contractor dedicated to the Work on a
full-time basis actually incurred over and above Contractor’s normal rates, and
overtime charges for equipment and any additional field overhead or expenses
resulting from the acceleration directive. Any adjustment to the Contract Price
or any other Changed Criteria that the Parties agree will be changed by such
acceleration for Owner’s acceleration of the

 

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Work shall be implemented by Change Order. If Owner directs Contractor to
accelerate the Work pursuant to a Change Order, Contractor shall immediately
commence and diligently perform the acceleration of the Work as directed by
Owner, and shall prepare a schedule to explain and display how it intends to
accelerate the Work and how that acceleration will affect the critical path of
the CPM Performance Measurement Baseline Schedule (the “Acceleration Schedule”).
With respect to the Acceleration Schedule, Contractor shall do the following:

A. No later than the fifteenth (15th) Day after such directive, Contractor shall
prepare the Acceleration Schedule and submit it to Owner for its review. The
Acceleration Schedule shall represent Contractor’s best judgment as to how it
shall satisfy Owner’s acceleration directive. The Acceleration Schedule shall be
prepared using GECP and to a similar level of detail as the CPM Performance
Measurement Baseline Schedule.

B. On the fifteenth (15th) Day after such directive (or such longer time as
specified in writing by Owner), Contractor shall participate in a conference
with Owner, and with any other Person, including Subcontractors and
Sub-subcontractors, whom Owner designates to participate, to review and evaluate
the Acceleration Schedule. Any revisions to the Acceleration Schedule necessary
as a result of this review shall be resubmitted for review by Owner no later
than the tenth (10th) Day of such meeting or such other date as Owner may
permit. The revised Acceleration Schedule shall then be the schedule which
Contractor shall use in planning, organizing, directing, coordinating,
performing, and executing that portion of the Work that is affected by such
acceleration, with the CPM Performance Measurement Baseline Schedule governing
the performance of all other Work.

Owner’s review and approval of the Acceleration Schedule shall not constitute an
independent evaluation or determination by Owner of the workability,
feasibility, or reasonableness of that schedule.

ARTICLE 6

CHANGES; FORCE MAJEURE; AND OWNER-CAUSED DELAY

6.1 Change Orders Requested by Owner. Owner shall be entitled to a Change Order
upon request in accordance with this Section 6.1.

A. If Owner submits to Contractor in writing a duly signed proposed Change
Order, Contractor must respond to Owner within fifteen (15) Days with a written
statement setting forth the effect, if any, which such proposed Change Order
would have on the Contract Price, the Key Milestone Schedule, the Design Basis,
the Guaranteed Substantial Completion Date, the Required Final Completion Date,
the Payment Schedule, any of the Minimum Acceptance Criteria or Performance
Guarantees, or any other obligation or potential liability of Contractor
hereunder (collectively or individually, the “Changed Criteria”). The written
statement shall be in the form of Schedule D-3, and shall include all
information required by Section 6.5B.

B. If the Parties agree on such Changed Criteria of the proposed Change Order
(or modify such Change Order so that the Parties agree on such Changed
Criteria), the

 

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Parties shall execute such Change Order, which shall be in the form of
Schedule D-1 and such Change Order shall become binding on the Parties, as part
of this Agreement.

C. If the Parties cannot agree on such Changed Criteria of the proposed Change
Order within ten (10) Business Days after Contractor’s receipt of Owner’s
proposed Change Order, or if Owner desires that the proposed changed Work set
forth in the proposed Change Order commence immediately without the requirement
of a written statement by Contractor as required under Section 6.1A, Owner may,
by issuance of an Owner-directed Change Order in the form attached hereto as
Schedule D-2, require Contractor to commence and perform the changed Work
specified in the Owner-directed Change Order on a time and materials basis in
accordance with Section 6.3. Thereafter, the Parties may discuss the effect of
such Owner-directed Change Order on the Changed Criteria (or if the Parties
agree on the effect of such Owner-directed Change Order for some but not all of
the Changed Criteria, the impact of each of the components of the Changed
Criteria on which the Parties have not yet agreed), and if the effects of the
Changed Criteria are agreed upon (including the adjustment to the Contract
Price, if any), the Parties shall enter into a mutual Change Order in the form
of Schedule D-1 superseding the applicable Owner-directed Change Order
(previously issued in the form of Schedule D-2). The Parties acknowledge that,
with respect to changed Work affecting the Siemens Equipment which can only be
performed pursuant to the Siemens Contract, the scope of such changed Work
requested by an Owner-directed Change Order may be restricted by the terms set
forth in Section 10.2 of the Siemens Contract; provided, however, that
Contractor shall use commercially reasonable efforts to have Siemens perform
such changed Work notwithstanding the restrictions available to Siemens in
Section 10.2 of the Siemens Contract. If the Parties cannot agree on the effect
of such Owner-directed Change Order by the date of Final Completion, then the
dispute shall be resolved as provided in Article 19. Pending resolution of the
dispute, Contractor shall perform the Work as specified in such Owner-directed
Change Order in accordance with this Section 6.1C and Owner shall continue to
pay Contractor in accordance with the terms of this Agreement and any previously
agreed Change Orders. When Owner and Contractor agree on the effect of such
Owner-directed Change Order on all of the Changed Criteria, such agreement shall
be recorded by execution by the Parties of a mutually agreed Change Order in the
form attached hereto as Schedule D-1, which shall supersede the Owner-directed
Change Order previously issued and relating to such changed Work.

6.2 Change Orders Requested by Contractor.

A. Contractor shall have the right to request a Change Order in the event of any
of the following occurrences:

1. Changes in Law that materially and adversely affect Contractor’s actual cost
(which costs shall be adequately documented and supported by Contractor) of
performance of the Work or Contractor’s ability to perform any material
requirement under this Agreement, and with respect to any delays (as that term
is defined in Section 6.10) caused by such Changes in Law, compensation and a
time extension to the Key Milestone Schedule, Guaranteed Substantial

 

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Completion Date and Required Final Completion Date, as applicable, to the extent
allowed under Section 6.8;

2. Acts or omissions of Owner that constitute a breach of any express obligation
of Owner under this Agreement and materially and adversely affect Contractor’s
actual cost (which costs shall be adequately documented and supported by
Contractor) of performance of the Work or ability to perform any material
requirement under this Agreement and, with respect to delays (as that term is
defined Section 6.10) caused by Owner, compensation and a time extension to the
Key Milestone Schedule, Guaranteed Substantial Completion Date and Required
Final Completion Date, as applicable, to the extent allowed under Section 6.8;

3. Force Majeure to the extent allowed under Section 6.7A;

4. Acceleration of the Work ordered by Owner pursuant to Section 5.6;

5. If Contractor discovers at the Site any underground utilities, manmade
subsurface obstructions, rocks that require blasting, sinkholes or archeological
finds which were (a) not indicated in, or which materially differ from, the Soil
Report or the Final Geotechnical Report and (b) otherwise unknown or not
identified by or to Contractor, to the extent such discovery has a material and
adverse impact on Contractor’s actual cost (which costs shall be adequately
documented and supported by Contractor) of performance of the Work or
Contractor’s ability to perform any material requirement under this Agreement,
and with respect to any delays (as that term is defined in Section 6.10) caused
by such discovery, compensation and a time extension to the Key Milestone
Schedule, Guaranteed Substantial Completion Date and Required Final Completion
Date, as applicable, to the extent allowed under Section 6.8;

6. To the extent expressly permitted under Section 2.5B.1 for material
differences between the Soils Report and the Final Geotechnical Report;

7. If the ground water constituents and flow rate potential existing at the Site
are materially different from the information set forth in Attachment CC, to the
extent such difference has a material and adverse impact on Contractor’s actual
cost (which costs shall be adequately documented and supported by Contractor) of
performance of the Work or Contractor’s ability to perform any material
requirement under this Agreement, and with respect to any delays (as that term
is defined in Section 6.10) caused by such difference, compensation and a time
extension to the Key Milestone Schedule, Guaranteed Substantial Completion Date
and Required Final Completion Date, as applicable, to the extent allowed under
Section 6.8;

 

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8. To the extent expressly permitted under Sections 5.2B, 5.2C, 5.2D, 5.2F,
5.3A, 9.2A, 10.2, 12.9 and 13.2A, Section 1.10.5 of Attachment O, and Attachment
AA;

9. Subject to Contractor’s liabilities and responsibilities assumed under
Section 3.17, if pre-existing Hazardous Materials are discovered at the Site
(other than those discovered during the course of the demolition Work, for which
relief is available to the extent provided in Section 5.2D or Attachment AA)
that materially and adversely affect Contractor’s actual cost (which costs shall
be adequately documented and supported by Contractor) of performance of the Work
or Contractor’s ability to perform any material requirement under this
Agreement, and with respect to any delays (as that term is defined in
Section 6.10) caused by such discovery, compensation and a time extension to the
Key Milestone Schedule, Guaranteed Substantial Completion Date and Required
Final Completion Date, as applicable, to the extent allowed under Section 6.8;

10. An emergency causing imminent and immediate danger to human health or
property (excluding the Work), which was not caused by, or did not arise out of,
any acts or omission of Contractor or any Subcontractor or Sub-subcontractor or
an event of Force Majeure, and which materially and adversely affects
Contractor’s actual cost (which costs shall be adequately documented and
supported by Contractor) of performance of the Work;

11. Purchase of operating spare parts in accordance with Section 3.4 (including
Section 3.4C); or

12. Suspension in Work ordered by Owner pursuant to Section 17.3.

B. Should Contractor desire to request a Change Order under this Section 6.2,
Contractor shall, pursuant to Section 6.5, notify Owner in writing and issue to
Owner, at Contractor’s expense, a request for a proposed Change Order in the
form attached hereto as Schedule D-3, a detailed explanation of the proposed
change and Contractor’s reasons for proposing the change, all documentation
necessary to verify the effects of the change on the Changed Criteria, and all
other information required by Section 6.5. Any adjustments to the Contract Price
shall be requested on a lump sum basis.

C. If Owner agrees that a Change Order is necessary and agrees with Contractor’s
statement regarding the effect of the proposed Change Order on the Changed
Criteria, then Owner shall issue such Change Order, which shall be in the form
of Schedule D-1, and such Change Order shall become binding on the Parties as
part of this Agreement upon execution thereof by the Parties.

D. If the Parties agree that Contractor is entitled to a Change Order but cannot
agree on the effect of the proposed Change Order on the Changed Criteria within
ten (10) Business Days of Owner’s receipt of Contractor’s written notice and
proposed Change Order and all other required information, or if Owner desires
that the proposed changed

 

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Work set forth in the proposed Change Order commence immediately the rights,
obligations and procedures set forth in Section 6.1C are applicable.

E. If the Parties cannot agree upon whether Contractor is entitled to a Change
Order within ten (10) Business Days (or such longer period as may be mutually
agreed in writing) of Owner’s receipt of Contractor’s written notice and
proposed Change Order, then the dispute shall be resolved as provided in Article
19. Pending resolution of the dispute, Contractor shall continue to perform the
Work required under this Agreement, and Owner shall continue to pay Contractor
in accordance with the terms of this Agreement and any previously agreed upon or
Owner-directed Change Orders. In addition, Contractor shall maintain a detailed
accounting of the costs (and any other impacts) incurred by Contractor for Work
performed by Contractor for which it has requested a Change Order and which
Owner disagrees that a Change Order is entitled pursuant to this Section 6.2E.
Such costs and other impacts to the Work shall be reported to Owner within the
Monthly Progress Reports.

6.3 Contract Price Adjustment; Contractor Documentation. If a Change Order is
executed on a time and materials basis pursuant to Section 6.1C or 6.2D, then
the costs incurred in performing such Change Order shall be determined as
follows:

A. Direct Craft Labor. Direct craft labor costs shall be based upon actual hours
expended by such craft labor for the time and materials Work at the published
union wage scales.

B. Small Tool and Supplies. Costs for small tools and supplies shall be
determined by ***.

C. Construction Equipment. With respect to construction equipment used to
perform the time and materials Work, Contractor shall be paid for incremental
costs incurred only (over and above that which is incurred to perform the Work
for the Contract Price) at ***.

D. Materials and Subcontracts. Materials purchased by Contractor for the time
and materials Work, and time and materials Work performed by Subcontractors and
Sub-subcontractors, shall be invoiced to Owner ***.

E. Management, Engineering and Design. Costs for Contractor’s project
management, engineering and design services in performing time and materials
Work shall be based upon ***.

F. Taxes. If Contractor incurs any California sales and use Taxes in the course
of performing the time and materials Work, Owner shall reimburse Contractor for
the actual cost of such California sales and use Taxes properly paid by
Contractor under Applicable Law.

G. General and Administrative Expenses. Contractor shall be reimbursed for
general and administrative expenses and all other overhead, markups and
multipliers applicable to the time and materials Work by ***.

 

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H. Profit. Contractor’s profit for the time and materials Work ***.

Unless otherwise agreed in writing by Owner prior to the incurrence of the cost,
the foregoing costs and markups shall be the sole costs and markups invoiced to
Owner for Change Order Work performed on a time and materials basis. Contractor
shall use reasonable efforts to minimize costs incurred on a time and material
basis (consistent with the requirements of this Agreement) and shall provide
Owner with options for reducing such costs whenever possible. The foregoing
costs shall be supported by reasonable documentation, including daily work logs,
time sheets, invoices and receipts.

6.4 Change Orders Act as Accord and Satisfaction. Change Orders agreed pursuant
to Section 6.1B or 6.2C by the Parties, and Owner-directed Change Orders entered
into pursuant to Section 6.1C or 6.2D on a time and materials basis and which
the Parties have subsequently agreed upon the effect of such Owner-directed
Change Order and executed a superseding and mutually agreed upon Change Order as
provided in Section 6.1B or 6.2C shall constitute a full and final settlement
and accord and satisfaction of all effects of the change as described in the
Change Order upon the Changed Criteria and shall be deemed to compensate
Contractor fully for such change. Accordingly, Contractor expressly waives and
releases any and all right to make a claim or demand or to take any action or
proceeding against Owner for any other consequences arising out of, relating to,
or resulting from such change reflected in such Change Order, whether the
consequences result directly or indirectly from such change reflected in such
Change Order, including any claim or demand for damages due to delay,
disruption, hindrance, impact, interference, inefficiencies or extra work
arising out of, resulting from, or related to, the change reflected in that
Change Order (including any claims or demands that any Change Order or number of
Change Orders, individually or in the aggregate, have impacted the unchanged
Work).

6.5 Timing Requirements for Notifications and Change Order Requests by
Contractor. Should Contractor desire to seek an adjustment to the Contract
Price, the Key Milestone Schedule, the Guaranteed Substantial Completion Date,
the Required Final Completion Date, the Payment Schedule, any of the Minimum
Acceptance Criteria or Performance Guarantees or any other modification to any
other obligation of Contractor under this Agreement for any circumstance that
Contractor has reason to believe may give rise to a right to request the
issuance of a Change Order, Contractor shall, with respect to each such
circumstance:

A. notify Owner in writing of the existence of such circumstance within twenty
(20) Days after the date that Contractor knew or reasonably should have known of
the first occurrence or beginning of such circumstance, provided that (i) if
such circumstance is an emergency, oral notice shall be given immediately,
followed by a written notice within five (5) Business Days after the date such
oral notice is provided, (ii) if such circumstance is considered by Contractor
to be an event of Force Majeure, written notice shall be provided within four
(4) Business Days after the commencement of such occurrence that is considered a
Force Majeure and (iii) such notice shall be given as soon as practicable, and
prior to the expiration of such twenty (20) Day period, should any action or
inaction by Owner or Contractor be required or necessary in relation to such
circumstance to prevent or mitigate any damages or losses to either Party. In
the notice required under this Section 6.5A notice, Contractor shall state, in
as reasonable of detail as is practicable under the circumstances, all known and
presumed facts upon which its claim is based, including the

 

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character, duration and extent of such circumstance, the date Contractor first
knew of such circumstance, any activities impacted by such circumstance, the
cost and time consequences of such circumstance (including showing the impact of
such circumstance, if any, on the critical path of the CPM Performance
Measurement Baseline Schedule) and any other details or information that are
expressly required under this Agreement and any reasonably available information
and documents relevant to such claim or circumstance. Contractor shall only be
required to comply with the notice requirements of this Section 6.5A once for
continuing circumstances, provided the notice expressly states that the
circumstance is continuing and includes Contractor’s best estimate of the impact
on any Changed Criteria by such circumstance; and

B. submit to Owner a request for a proposed Change Order as soon as reasonably
practicable after giving Owner written notice but in no event later than twenty
(20) Days after the completion of each such circumstance, together with a
written statement (i) detailing why Contractor believes that a Change Order
should be issued, plus all documentation reasonably requested by or necessary
for Owner to determine the factors necessitating the possibility of a Change
Order and all other information and details expressly required under this
Agreement (including the information required by Schedule D-4, detailed
estimates and cost records, daily time sheets and a graphic demonstration using
the CPM Performance Measurement Baseline Schedule, showing Contractor’s
entitlement to a time extension to the Key Milestone Schedule, Guaranteed
Substantial Completion Date and Required Final Completion Date, as applicable,
pursuant to the terms of this Agreement, which shall be provided in hard copy
and in an electronic format meeting the requirements of Attachment U); and
(ii) setting forth the effect, if any, which such proposed Change Order would
have for the Work on any of the Changed Criteria. If it is not possible for
Contractor to provide all of the information required under this Section 6.5B to
be submitted with such proposed Change Order within such twenty (20) Day period,
Contractor shall provide Owner with as much information as possible as well as a
written explanation of the reason additional time is required. With respect to
any information not provided within such twenty (20) Day period, Contractor
shall exercise reasonable diligence to provide such information as soon as
possible, but in no event later than thirty (30) Days following Contractor’s
submission of such proposed Change Order.

The Parties acknowledge that Owner may be prejudiced if Contractor fails to
provide the notices and proposed Change Orders as required under this
Section 6.5, and agree that such requirements are an express condition precedent
necessary to any right for an adjustment in Contract Price, the Key Milestone
Schedule, the Guaranteed Substantial Completion Date, the Required Final
Completion Date, the Payment Schedule, any Work, any of the Minimum Acceptance
Criteria or Performance Guarantees or any other modification to any other
obligation of Contractor under this Agreement. Accordingly, if Contractor fails
to materially comply with the requirements of this Section 6.5 in connection
with notices and proposed Change Orders (with the exception of the timing
requirements set forth in this Section 6.5, which require strict compliance),
any and all claims (including any claim for an adjustment in the Contract Price,
Key Milestone Schedule, Guaranteed Substantial Completion Date, Required Final
Completion Date or any other modification to any other obligation of Contractor
under this Agreement) that should have been provided in such notice or proposed
Change Order are waived and released by Contractor to the extent that

 

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Owner is prejudiced as a result of Contractor failing to comply with the
requirements of this Section 6.5.

6.6 Adjustment Only Through Change Order. No change in the requirements of this
Agreement, whether an addition to, deletion from, suspension of or modification
to this Agreement, including any Work, shall be the basis for an adjustment for
any change in the Contract Price, the Key Milestone Schedule, the Guaranteed
Substantial Completion Date, the Required Final Completion Date, Payment
Schedule, any Work, any of the Minimum Acceptance Criteria or Performance
Guarantees or any other obligations of Contractor or right of Owner under this
Agreement unless and until such addition, deletion, suspension or modification
has been authorized by a Change Order executed and issued in accordance with and
in strict compliance with the requirements of this Article 6. Contractor shall
not perform any change in the Work unless and until such change is authorized
pursuant to this Article 6, and should Contractor perform or claim to perform
any changes in the Work prior to authorization by Change Order, all such costs
and expenses incurred by Contractor shall be for Contractor’s account. No course
of conduct or dealings between the Parties, nor express or implied acceptance of
additions, deletions, suspensions or modifications to this Agreement, including
any Work, and no claim that Owner has been unjustly enriched by any such
addition, deletion, suspension or modification to this Agreement shall be the
basis for any claim for an adjustment in the Contract Price, the Key Milestone
Schedule, the Guaranteed Substantial Completion Date, the Required Final
Completion Date, the Payment Schedule, any Work, any of the Minimum Acceptance
Criteria, Performance Guarantees or any other obligations of Contractor under
this Agreement.

6.7 Force Majeure.

A. Contractor Relief. If the commencement, prosecution or completion of the Work
is delayed by Force Majeure, then Contractor shall be entitled to an extension
to the Key Milestone Schedule, the Guaranteed Substantial Completion Date and
the Required Final Completion Date, as applicable, if such delay affects the
performance of any Work that is on the critical path of the CPM Performance
Measurement Baseline Schedule and Contractor complies with the notice and Change
Order request requirements in Section 6.5 and the mitigation requirements in
Section 6.11. The Parties agree that Contractor’s sole remedy for such delay
shall be an adjustment to the Key Milestone Schedule, the Guaranteed Substantial
Completion Date and the Required Final Completion Date, as applicable, pursuant
to a Change Order. Any adjustment to the Key Milestone Schedule, the Guaranteed
Substantial Completion Date and the Required Final Completion Date, as
applicable, shall be recorded in a Change Order.

B. Owner Relief. Subject to Section 6.7C, Owner’s obligations under this
Agreement shall be suspended to the extent that performance of such obligations
is delayed by Force Majeure.

C. Payment Obligations. No obligation of a Party to pay moneys due and owing
under this Agreement shall be excused by reason of Force Majeure.

6.8 Delay Caused by Owner or Changes in Scope of Work. Should Owner or any
Person acting on behalf of or under the control of Owner delay the commencement,
prosecution or

 

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completion of the Work, and to the extent such delay is not attributable to
Contractor or its Subcontractors or Sub-subcontractors but is caused by Owner’s
breach of an express obligation of Owner under this Agreement or is caused by
Owner’s ordering a change in the Scope of the Work (provided that a Change Order
has been issued in accordance with Section 6.1), then Contractor shall be
entitled to an adjustment in the Contract Price and an extension to the Key
Milestone Schedule, Guaranteed Substantial Completion Date and Required Final
Completion Date, as applicable, to the extent (a) such delay affects the
performance of any Work that is on the critical path of the CPM Performance
Measurement Baseline Schedule and (b) Contractor complies with the notice and
Change Order request requirements in Section 6.5 and the mitigation requirements
of Section 6.11. Any adjustment to the Contract Price shall be for reasonable,
additional direct costs incurred by Contractor for such delay meeting the
requirements of this Section 6.8, and any adjustments to the Contract Price, Key
Milestone Schedule, Guaranteed Substantial Completion Date and Required Final
Completion Date, as applicable, shall be recorded in a Change Order. The Parties
agree that if they execute a Change Order with respect to any change in the
Scope of Work described in this Section 6.8, any delay arising out of such
change in the Scope of Work and meeting the requirements of this Section 6.8
shall be included in the Change Order incorporating such change in the Scope of
Work.

6.9 Schedule Extension. ***

6.10 Delay. For the purposes of Article 6, the term “delay” shall include
hindrances, disruptions or obstructions, or any other similar term in the
industry and the resulting impact from such hindrances, disruptions or
obstructions, including inefficiency, impact, ripple or lost production. For the
avoidance of doubt, the Parties recognize and agree that for the purposes of
Article 6, a work activity not on the critical path can become on the critical
path, and if a delay causes a work activity off the critical path to become a
critical path activity, Contractor is entitled to an extension to the Key
Milestone Schedule, Guaranteed Substantial Completion Date and Required Final
Completion Date, as applicable, for those days of delay after which the
non-critical path activity became a critical path activity, provided that such
delay satisfies the other requirements under Article 6.

6.11 Contractor Obligation to Mitigate Delay. In no event shall Contractor be
entitled to any adjustment to the Key Milestone Schedule, Guaranteed Substantial
Completion Date, Required Final Completion Date and the Contract Price for that
portion of delay to the extent Contractor could have taken, but failed to take,
commercially reasonable actions to mitigate such delay.

ARTICLE 7

CONTRACT PRICE AND PAYMENTS TO CONTRACTOR

7.1 Contract Price. As compensation in full to Contractor for the full and
complete performance of the Work and all of Contractor’s other obligations under
this Agreement, Owner shall pay and Contractor shall accept *** (the “Contract
Price”). The Contract Price is subject to adjustment only by Change Order as
provided in Article 6, and includes all Taxes, costs, charges, and expenses of
whatever nature applicable to the Work (other than those California sales and
use Taxes for which Owner shall reimburse Contractor pursuant to Article 8). For
the avoidance of doubt, the Contract Price includes all costs, markups and other
expenses for the Siemens

 

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Equipment (other than the California sales and use Taxes for which Owner shall
reimburse Contractor pursuant to Article 8). The Parties agree that (i) amounts
paid by Owner to Contractor pursuant to the MOU shall be credited towards the
EPC Payment Milestone portion of the Contract Price and (ii) amounts paid by
Owner to Siemens prior to assignment of the Siemens Contract to Contractor
pursuant to Section 22.8 shall be credited towards the Siemens Equipment Payment
Milestone portion of the Contract Price.

7.2 Interim Payments.

A. Payments. Payments shall be made by Owner to Contractor in accordance with
the Payment Schedule set forth in Attachment C (as may be amended by Change
Order pursuant to Section 6.1B or 6.2C), which allocates (i) *** of the Contract
Price to be paid based on completion of the EPC Payment Milestones set forth in
Schedule C-1 (the “EPC Payment Milestone portion of the Contract Price”) and
(ii) *** of the Contract Price to be paid based on completion of the Siemens
Equipment Payment Milestones set forth in Schedule C-2 (“Siemens Equipment
Payment Milestone portion of the Contract Price”), provided that Contractor is
otherwise in material compliance with the terms of this Agreement. That portion
of the Contract Price set forth in the foregoing sentence to be paid based upon
Siemens Equipment Payment Milestones corresponds to the payment milestones and
progress payments to be made by Contractor to Siemens under the Siemens Contract
and contains no further costs, expenses, markups, profit, overhead or other
expenditures. Owner shall also make payments to Contractor for any
Owner-directed Change Orders issued in accordance with Section 6.1C or 6.2D and
shall reimburse applicable California sales and use Taxes in accordance with
Article 8. Each payment shall be subject to Retainage and Owner’s right to
withhold payments under this Agreement, including Sections 7.5 and 14.3.
Payments shall be made in U.S. Dollars to an account designated by Contractor.
The Payment Schedule, including the Payment Milestones, shall be amended only by
Change Order pursuant to this Agreement.

B. Invoices. Within ten (10) Days after the end of each Month, Contractor shall
submit to Owner an Invoice for (i) all EPC Payment Milestones completed during
the prior Month, if any, as set forth in Schedule C-1, less the Retainage to be
withheld by Owner for such amount, (ii) all Siemens Equipment Payment Milestones
completed during the prior Month, if any, as set forth in Schedule C-2 and
(iii) California sales and use Taxes incurred in the procurement of the Siemens
Equipment in accordance with Article 8. Contractor shall not be entitled to any
payment whatsoever for any portion of the Work relating to a particular Payment
Milestone until such Payment Milestone is fully completed. Such Monthly Invoice
shall also include amounts properly due and owing for Work performed during the
prior Month and pursuant to an Owner-directed Change Order issued pursuant to
Section 6.1C or 6.2D, less Retainage. All Invoices, other than the Invoice for
final payment under this Agreement, shall be in the form of Schedule I-1, and
shall include all documentation supporting its request for payment as required
under this Agreement. Contractor shall provide documentation such as invoices
and receipts supporting all amounts billed for Owner-directed Change Orders
issued pursuant to Section 6.1C or 6.2D.

 

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C. Interim Lien and Claim Waivers. Each Invoice received by Owner prior to Final
Completion shall be accompanied by (i) a fully executed Interim Waiver and
Release of Liens from Contractor in the form of Schedule K-1, and a fully
executed Interim Claim Waiver from Contractor in the form of Schedule K-2, for
all Work performed through the date for which payment is requested, (ii) fully
executed Interim Waiver and Release of Liens from each Major Subcontractor in
the form set forth in Schedule K-3, and fully executed Interim Claim Waivers
from each Major Subcontractor in the form set forth in Schedule K-4, for all
Work performed through the date for which payment is requested and (iii) if
requested by Owner, fully executed Interim Waiver and Release of Liens from all
Major Sub-subcontractors requested substantially in the form set forth in
Schedule K-3 (but nevertheless conforming with Applicable Law), and fully
executed Interim Claim Waivers from all Major Sub-subcontractors requested in
substantially the form set forth in Schedule K-4, for all Work performed through
the date for which payment is requested; provided, however, with respect
Siemens, receipt of Interim Waiver and Release of Liens and Interim Claim
Waivers from Siemens will be in accordance with the form and content
requirements set forth in the Siemens Contract; provided further, however, with
respect to Major Sub-subcontractors under Siemens, receipt of Interim Waiver and
Release of Liens and Interim Claim Waivers from such Major Sub-subcontractors
will be in accordance with the form, content and timing requirements set forth
in the Siemens Contract. Interim Waiver and Release of Liens and Interim Claim
Waivers, however, shall not be required from Major Subcontractors or Major
Sub-subcontractors until they have performed Work, and Major Subcontractors and
Major Sub-subcontractors shall be required to submit additional Interim Waiver
and Release of Liens and Interim Claim Waivers only if they have performed Work
not covered by a previous Interim Waiver and Release of Liens and Interim Claim
Waiver. Submission of all Interim Waiver and Release of Liens and Interim Claim
Waivers in accordance with this Section 7.2C is a condition precedent to payment
of any Invoice.

D. Review and Approval. Each Invoice shall be reviewed by Owner and, upon
Owner’s reasonable request, Contractor shall furnish such supporting
documentation and certificates and provide such further information as may be
reasonably requested by Owner. Unless disputed by Owner, each Invoice (less any
withholdings allowed under this Agreement, including Retainage) shall be due and
payable thirty (30) Days after it, and all documentation required under this
Agreement, is received by Owner. If an Invoice is disputed by Owner, then
payment shall be made for all undisputed amounts and the dispute shall be
resolved pursuant to Article 19. Payment on disputed amounts shall be made as
soon as such dispute is resolved.

E. Maximum Cumulative Payment Amounts. The Parties have agreed upon and set
forth in Schedule C-3 a schedule of the maximum cumulative amounts that
Contractor is allowed to invoice Owner at any one time during the performance of
the Work (the “Maximum Cumulative Payment Schedule”). Schedule C-3 sets forth
both (a) the maximum amount that Contractor can invoice at any one time and
allocate to the Siemens Equipment Payment Milestone portion of the Contract
Price and (b) the maximum amount Contractor can invoice at any one time (before
giving effect to Retainage) and allocate to the EPC Payment Milestone portion of
the Contract Price. Schedule C-3 shall only be subject to adjustment pursuant to
a Change Order.

 

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F. Cooperation in Invoicing Process. Without in anyway altering the rights,
obligations and remedies set forth in this Agreement, the Parties acknowledge
that they will reasonably cooperate in the timing of the receipt and review of
Invoices and coordinate same with invoices received by Contractor under the
Siemens Contract with the view to have payment milestones that are properly
earned and invoiced under the Siemens Contract included as a Siemens Equipment
Payment Milestone in the Invoice under this Agreement in the corresponding
Month.

7.3 Final Completion and Final Payment. Upon Final Completion, Contractor shall,
in addition to any other requirements in this Agreement for achieving Final
Completion, including those requirements set forth in Section 1.1 for the
definition of Final Completion, submit a fully executed final Invoice in the
form attached hereto as Schedule I-2, along with (i) a statement summarizing and
reconciling all previous Invoices, payments and Change Orders, (ii) an affidavit
that all payrolls, Taxes, liens, charges, claims, demands, judgments, security
interests, bills for Equipment, and any other indebtedness connected with the
Work have been paid, (iii) fully executed Final Waiver and Release of Liens and
Final Claim Waiver from Contractor in the forms of Schedule K-5 and K-6,
respectively, (iv) fully executed Final Waiver and Release of Liens and Final
Claim Waivers from each Major Subcontractor in the forms set forth in Schedule
K-7 and K-8, respectively and (v) if requested by Owner, fully executed Final
Waiver and Release of Liens and Final Claim Waivers from each Major
Sub-subcontractor in substantially the form set forth in Schedule K-7 and K-8,
respectively (but nevertheless conforming with Applicable Law); provided,
however, with respect Siemens, receipt of the Final Waiver and Release of Liens
and Final Claim Waiver from Siemens will be in accordance with the form and
content requirements set forth in the Siemens Contract; provided further,
however, with respect to Major Sub-subcontractors under Siemens, receipt of the
Final Waiver and Release of Liens and Final Claim Waivers from such Major
Sub-subcontractors will be in accordance with the form and content requirements
set forth in the Siemens Contract. No later than thirty (30) Days after receipt
by Owner of such final Invoice and all requested documentation and achieving
Final Completion, Owner shall, subject to its rights to withhold payment under
this Agreement, pay Contractor the balance of the Contract Price, including any
remaining Retainage.

7.4 Payments Not Acceptance of Work. No payment made hereunder by Owner shall be
considered as approval or acceptance of any Work by Owner or a waiver of any
claim or right Owner may have hereunder. All payments shall be subject to
correction or adjustment in subsequent payments.

7.5 Payments Withheld. In addition to disputed amounts set forth in an Invoice,
Owner may, in addition to any other rights under this Agreement, at law or in
equity, withhold payment on an Invoice or a portion thereof in an amount and to
such extent as may be reasonably necessary to protect Owner from loss due to:

A. Defective Work not remedied in accordance with this Agreement;

B. liens or other encumbrances on all or a portion of the Site, the Work or the
Facility, which are filed by any Subcontractor, any Sub-subcontractor or any
other Person acting through or under any of them;

 

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C. any material breach by Contractor of this Agreement;

D. the assessment of any fines or penalties against Owner as a result of
Contractor’s failure to comply with Applicable Law or Applicable Codes and
Standards;

E. a discovery that a Payment Milestone or other Work associated with a prior
payment was not in fact achieved, or that Work associated with a prior Payment
Milestone contained Defective Work;

F. amounts paid by Owner to Contractor in a preceding Month incorrectly or for
which there was insufficient or inaccurate supporting information;

G. Liquidated Damages which Contractor owes under the terms of this Agreement;

H. failure of Contractor to make payments to Subcontractors as required under
their respective Subcontracts;

I. failure of Contractor to comply with its monthly progress reporting
obligations and scheduling obligations under this Agreement, including as set
forth in Sections 3.19A.4, 5.4 and 5.5; or

J. any other reason for which Owner is entitled to withhold payment under this
Agreement.

Owner shall pay Contractor the amount withheld if Contractor (i) pays, satisfies
or discharges the applicable claim of Owner against Contractor under or by
virtue of this Agreement and provides Owner with reasonable evidence of such
payment, satisfaction or discharge, (ii) cures all such breaches and Defaults in
the performance of this Agreement, or (iii) provides Owner with a standby letter
of credit reasonably satisfactory to Owner in the amount of the withheld
payment. Owner’s failure to withhold in the event of any of the circumstances
described in this Section shall not be deemed to be a waiver of any of Owner’s
rights under this Agreement, including Owner’s right to withhold at any time one
of the circumstances in Section 7.5A through 7.5J exists.

7.6 Substitution for Retainage; Release of Retainage.

A. Substitution for Retainage. In Contractor’s sole discretion, Contractor may
elect to substitute an irrevocable standby letter of credit, in a form
acceptable to Owner in its reasonable discretion, in the amount of *** in lieu
of Owner withholding Retainage under this Agreement (which such amount of the
substitute letter of credit shall be adjusted as the EPC Payment Milestone
portion of the Contract Price is adjusted by Change Order). If Contractor makes
such an election, Owner shall release any Retainage previously withheld upon
receipt of such letter of credit in a form acceptable to Owner and shall
thereafter not collect Retainage under this Agreement. The letter of credit
provided pursuant to this Section 7.6A shall be issued by a commercial bank in
the United States with a long term rating of at least Investment Grade and shall
be issued in a form substantially similar to that in Schedule R-1, and
Contractor shall replace any substitute

 

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letter of credit, with a letter of credit that meets the requirements of this
Section 7.6A, within three (3) Business Days in the event that such commercial
bank’s long term rating falls below Investment Grade. Owner shall have the same
rights to collect on this substitute letter of credit, upon Owner’s demand, as
is set forth in Section 10.2, in the event Contractor fails to timely provide a
replacement letter of credit for (i) a substitute letter of credit that is to
expire within thirty (30) Days or (ii) a substitute letter of credit issued by a
bank that is no longer Investment Grade. In addition, Owner shall have the right
to collect upon the substitute letter of credit, upon Owner’s demand, in any
instance under this Agreement where Owner is able to (a) withhold or offset
payments otherwise due and owing to Contractor, including under Sections 7.5,
12.5B and 14.3, or (b) collect on the Contractor Letter of Credit pursuant to
Section 10.2.

B. Release of Retainage at Substantial Completion. Within thirty (30) Days after
Substantial Completion and receipt of an Invoice therefor, Owner shall, subject
to its right to withhold under this Agreement, release to Contractor all
Retainage withheld under this Agreement except for that portion of the Retainage
that is equal to ***. In the event Contractor has elected, pursuant to
Section 7.6A, to issue a substitute letter of credit in lieu of having Retainage
withheld, such substitute letter of credit shall be reduced in value to ***.

7.7 Interest on Late Payments. Any amounts due but not paid hereunder shall bear
interest at the lesser of (i) an annual rate equal to ***, or (ii) the maximum
rate permitted under Applicable Law.

7.8 Payments During Default. Owner shall not be obligated to make any payments
hereunder or payments withheld, at any time in which a Contractor Default shall
have occurred and is continuing.

7.9 Offset. Owner may, upon prior written notice to Contractor, offset any
amount due and payable from Contractor to Owner against any amount due and
payable to Contractor hereunder.

7.10 Currency. Unless otherwise specified, all amounts contained herein are in
and shall be paid in U.S. Dollars.

ARTICLE 8

TAXES

8.1 Taxes Generally. The Contract Price includes all Taxes which arise out of or
are related to the performance of the Work and Contractor shall be responsible
for timely paying all such Taxes; provided, however, Owner shall reimburse
Contractor for California sales and use Taxes incurred in the procurement of any
Siemens Equipment as well as any interest or penalties which may be imposed by a
Governmental Instrumentality at any time on Contractor due to Owner’s failure to
timely reimburse Contractor for California sales and use Taxes incurred in the
procurement of any Siemens Equipment. Owner’s obligation shall survive
termination or completion of the Agreement and shall end only upon the
completion of any time period allowed for audit or investigation by applicable
Governmental Instrumentalities. To the extent Owner

 

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timely reimburses Contractor for all such California sales and use Taxes for
Siemens Equipment, (1) Contractor shall release Owner of any further obligations
for payment of such California sales and use Taxes and (2) Contractor shall be
responsible for the payment of any interest or penalties related to Contractor’s
failure to timely pay such California sales and use Taxes. Owner and Contractor
will provide documents, information and data, make submission to Governmental
Instrumentalities, and otherwise cooperate as reasonably necessary to minimize
the amount of California sales and use Taxes payable for the Siemens Equipment.
In the event that Contractor is audited for California sales and use Taxes for
the Siemens Equipment, Contractor shall timely inform Owner of such audit, allow
Owner to assist with audit strategy and, at Owner’s expense, allow Owner to take
responsibility for defending the audit, protest or appeal based on mutually
satisfactory arrangements. Contractor shall reasonably cooperate with Owner to
assist in attempting to allocate local and district California sales and use
Taxes to the Site (which may include Contractor applying for a jobsite
sub-permit), including reasonable assistance in causing local California sales
and use Taxes to be assigned to the Site rather than to Contractor’s (or any
Subcontractor’s) regular place of business in California. Contractor will
reasonably cooperate with any joint refund claim that Owner, or its agents,
wishes to file for potentially overpaid California sales and use Taxes up to a
period of three (3) years after Substantial Completion or until the running of
the applicable statute of limitations, whichever is longer.

8.2 California Revenue Taxes. Notwithstanding Section 8.1, if a Change in Law
occurs relating to the method in or the rate at which revenue received by
Contractor through payments made by Owner under this Agreement is taxed by the
State of California or other local California taxing jurisdiction (collectively,
“California Revenue Taxes”), Contractor or Owner, as applicable, shall be
entitled to a Change Order to adjust the Contract Price (upwards or downwards,
as applicable) solely to reflect the net impact of the imposition of the
California Revenue Taxes, accounting for any reduction in the Contractor’s Taxes
attributable to changes in Applicable Law occurring after the Effective Date
that have reduced Contractor’s Taxes in the State of California arising out of
the performance of the Work (excluding those Taxes reimbursed by Owner pursuant
to Section 8.1). Notwithstanding Section 3.13B, Owner shall have all audit
rights necessary to develop or review a proposed Change Order related to this
Section 8.2. In addition, either Party may, at its sole expense, employ an
independent accounting firm to review the changes to Contractor’s Tax liability
in the context of this Section 8.2 and opine as to the amount of any Contract
Price adjustment available under this Section 8.2; provided that such opinion
shall not be binding upon either Party. In the event the Parties cannot agree
upon the adjustment to the Contract Price due under this Section 8.2, such
Dispute shall be resolved in accordance with Article 19.

ARTICLE 9

TITLE AND RISK OF LOSS

9.1 Title.

A. Clear Title. Contractor warrants and guarantees that legal title to and
ownership of the Work and the Facility shall be free and clear of any and all
liens, claims, security interests or other encumbrances when title thereto
passes to Owner.

 

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B. Title to Work. Title to all or any portion of the Work (other than Work
Product) shall pass to Owner upon the earlier of (i) payment by Owner therefor,
(ii) incorporation of such Work into the Facility or (iii) storage at the Site.
Transfer of title to Work shall be without prejudice to Owner’s right to reject
Defective Work, or any other right in the Agreement.

9.2 Risk of Loss.

A. Prior to Substantial Completion. ***

B. After Substantial Completion. ***

ARTICLE 10

INSURANCE AND PERFORMANCE SECURITY

10.1 Insurance.

A. Provision of Insurance. The Parties shall provide the insurance as specified
in Attachment O on terms and conditions stated therein.

B. Failure to Provide Required Insurance. IN THE EVENT THAT LIABILITY FOR ANY
LOSS OR DAMAGE IS DENIED BY THE UNDERWRITER OR UNDERWRITERS IN WHOLE OR IN PART
DUE TO THE VITIATION OF SAID INSURANCE RESULTING FROM AN ACT OR OMISSION BY
CONTRACTOR, OR FOR ANY OTHER REASON ATTRIBUTABLE TO CONTRACTOR, OR IF CONTRACTOR
FAILS TO MAINTAIN ANY OF THE INSURANCE HEREIN REQUIRED, THEN CONTRACTOR SHALL
DEFEND, INDEMNIFY AND HOLD THE OWNER GROUP HARMLESS AGAINST ALL LOSSES WHICH
WOULD OTHERWISE HAVE BEEN COVERED BY SAID INSURANCE.

10.2 Contractor Letter of Credit. ***

10.3 Contractor’s Parent Guarantee. Within five (5) Days after the Effective
Date, Contractor shall provide to Owner an irrevocable, unconditional corporate
guarantee from Kiewit Construction Company, in the form of Schedule Z-1, in
favor of Owner and guaranteeing all of Contractor’s obligations and liabilities
under this Agreement for the full duration of Contractor’s obligation and
liabilities under this Agreement. Contractor shall not be entitled to any
compensation under the Agreement unless and until Contractor provided the
foregoing corporate guarantee to Owner in accordance with this Section 10.3.

10.4 Owner’s Letter of Credit. ***

10.5 Owner’s Parent Guarantee. Upon issuance of the GTG LNTP, Owner shall
provide Contractor with an irrevocable, unconditional corporate guarantee from
Mirant Corporation, in the form of Schedule Z-2, in favor of Contractor, in an
amount not to exceed ***, guaranteeing Owner’s payment of the Kiewit Termination
Charge in the event of (i) a termination for convenience of this Agreement by
Owner or (2) a termination of this Agreement by Contractor pursuant to
Section 17.5.

 

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ARTICLE 11

OWNERSHIP OF DOCUMENTATION

11.1 Ownership of Work Product. Owner and Contractor acknowledge that during the
course of, and as a result of, the performance of the Work and prior work
related to the Facility done by Contractor for Owner (including any work done by
Contractor or any of its Affiliates under the MOU), Contractor or its
Affiliates, Subcontractors or Sub-subcontractors will create or have created for
the Facility certain written materials, plans, Drawings, Specifications,
calculations, Books and Records, computer files, or other tangible
manifestations of Contractor’s and its Subcontractors’ and Sub-subcontractors’
efforts related to the Work (whether hard copies or electronic copies, but
excluding Computer Programs) (hereinafter individually or collectively referred
to as “Work Product”). Owner shall own the hard and electronic copies of any
Work Product delivered or required to be delivered by Contractor to Owner under
the Agreement irrespective of any copyright notices or confidentiality legends
which may have been placed in or on such Work Product. Notwithstanding the
foregoing, as between Owner and Contractor, Contractor shall retain ownership of
all proprietary intellectual property rights owned, created, developed or
delivered by Contractor during the performance of the Work or otherwise
(including any such proprietary intellectual property embedded in the Work
Product) (hereinafter referred to as “Contractor’s Intellectual Property”), and
nothing in this Section 11.1 shall result in a transfer of ownership of any
Contractor’s Intellectual Property or the proprietary intellectual property
owned and developed by Contractor’s Subcontractors or Sub-subcontractors (“Third
Party Proprietary Work Product”). With respect to such Contractor’s Intellectual
Property and Third Party Proprietary Work Product relating to the Work or the
Facility, Contractor hereby grants Owner an irrevocable, perpetual,
non-exclusive and royalty-free license (including with the right to assign its
rights in accordance with Owner’s assignment rights set forth in Section 22.7)
to use, modify and copy such Contractor’s Intellectual Property and Third Party
Proprietary Work Product solely for purposes of operating, maintaining,
completing, repairing or modifying any part of the Facility and any interfaces
between the Facility and the Mirant Delta Facility. All Subcontracts and
Sub-subcontractors shall contain provisions consistent with this Section 11.1.

11.2 Computer Programs.

A. Contractor grants to Owner an irrevocable, non-exclusive, and royalty-free
license (including with right to assign its rights in accordance with Owner’s
assignment rights set forth in Section 22.7) to use Computer Programs for
operating, maintaining, completing or repairing the Work; provided, however,
that any modification of the Computer Program is either (a) required by
Applicable Law, (b) necessary to resolve a Defect or ensure proper operation and
maintenance of the Facility or (c) recommended by Siemens. The foregoing license
rights granted to Owner shall be no greater than the license rights in such
Computer Programs available to Siemens, but shall at all times be sufficient for
Owner to operate, maintain and repair the Facility. The term of such license
shall extend until the decommissioning or abandonment of the Facility by Owner,
its Affiliate or current owner.

B. The license described in this Section 11.2 does not grant any right to the
background technology from which the Computer Program was generated or to the
source code underlying the Computer Program. Owner is not granted any right to
create

 

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derivative works or modify the Computer Programs or merge it with other Computer
Programs (except to the extent reasonably necessary to operate, maintain or
repair the Facility).

11.3 Owner Provided Documents. All written materials, plans, drafts,
specifications, computer files or other documents (if any) prepared or furnished
by Owner, its Affiliates or any of Owner’s other consultants or contractors
shall at all times remain the property of Owner, and Contractor shall not make
use of any such documents or other media for any other project or for any other
purpose than as set forth herein. All such documents and other media, including
all copies thereof, shall, at Contractor’s option, either be returned to Owner
or destroyed upon the earlier of the end of the Defect Correction Period and
termination of this Agreement.

ARTICLE 12

COMPLETION AND PERFORMANCE LIQUIDATED DAMAGES

12.1 Notice and Requirements for Pre-Commissioning and Mechanical Completion.

A. Notice of Intent to Commence Pre-Commissioning. Contractor shall give Owner
not less than sixty (60) Days’ prior written notice of its intention to commence
any pre-commissioning activities required for Mechanical Completion, and, on the
tenth (10th) Day immediately prior to Contractor’s commencing such
pre-commissioning activities, Contractor shall provide a second written notice
to Owner. Contractor shall comply with all pre-commissioning activities required
for Mechanical Completion set forth in this Agreement, including those
requirements set forth in the definition of the term Mechanical Completion and
those set forth in Attachments A and V.

B. Requirements of Mechanical Completion. No later than three hundred sixty
(360) Days after the issuance of the NTP, Contractor shall provide to Owner for
its review and comment detailed Mechanical Completion requirements, in the form
of checklists, for each applicable system or subsystem of the Facility. Once
Contractor has incorporated all of Owner’s comments to the Mechanical Completion
checklists (to the extent such comments are consistent with the concepts
embodied by Mechanical Completion), such Mechanical Completion checklists shall
form a part of the requirements for achieving Mechanical Completion for each
system or subsystem of the Facility, as applicable. Contractor shall comply with
all requirements for Mechanical Completion set forth in this Agreement,
including those requirements set forth in the definition of the term Mechanical
Completion, Attachment A and Attachment V and the Mechanical Completion
checklists agreed by Owner and Contractor pursuant to this Section. At such time
as each system or subsystem of the Facility, as applicable, has achieved
Mechanical Completion, Contractor shall certify to Owner in the form of
Attachment L for Mechanical Completion of such system or subsystem (“Mechanical
Completion Certificate”) that all requirements under this Agreement for
Mechanical Completion of such system or subsystem, as applicable, have occurred,
including all of the requirements specified in the applicable Mechanical
Completion checklist have been completed. The Mechanical Completion Certificate
shall be accompanied by all other supporting documentation as may be required to
establish that the requirements for Mechanical Completion have been met.

 

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12.2 Notice and Requirements for Substantial Completion. Contractor shall comply
with all requirements for Substantial Completion herein, including as set forth
in the definition of the term Substantial Completion herein and in Attachment A,
Attachment S and Attachment T. Contractor shall give Owner not less than ninety
(90) Days’ prior written notice of its intention to commence the initial
Performance Tests. Final test procedures shall be determined in accordance with
Attachment S for the conduct of the Performance Tests, including the application
of corrective curves as set forth in Attachment S. Contractor shall provide
labor, equipment, supplies, and all other items necessary for the conduct of the
Performance Tests; provided, however, that Owner shall provide operating
personnel and natural gas fuel and power in accordance with Sections 4.4 and
4.7. Upon achieving all requirements under this Agreement for Substantial
Completion, Contractor shall certify to Owner in the form of Attachment M
(“Substantial Completion Certificate”) that all of the requirements under this
Agreement for Substantial Completion have occurred. The Substantial Completion
Certificate shall be accompanied by all supporting documentation required to
establish that the requirements for Substantial Completion have been met.

12.3 Owner Acceptance of Mechanical Completion and Substantial Completion. Owner
shall notify Contractor whether it accepts or rejects a Mechanical Completion
Certificate or the Substantial Completion Certificate, as the case may be,
within ten (10) Business Days following Owner’s receipt thereof. All Work shall
continue during pendency of Owner’s review. Acceptance of such Mechanical
Completion or Substantial Completion Certificate shall be evidenced by Owner’s
signature on such Mechanical Completion or Substantial Completion Certificate,
which shall be forwarded to Contractor with such notice. If Owner does not agree
that Mechanical Completion or Substantial Completion, as the case may be, has
occurred, then Owner shall state the basis for its rejection in reasonable
detail in a written notice provided to Contractor. The Parties shall thereupon
promptly and in good faith confer and make all reasonable efforts to resolve
such issue. In the event such issue is not resolved within ten (10) Business
Days after the delivery by Owner of its notice, Owner and Contractor shall
resolve the Dispute in accordance with the dispute resolution procedures
provided for under Article 19 herein. Owner’s acceptance shall not relieve
Contractor of any of its obligations to perform the Work in accordance with the
requirements of this Agreement.

12.4 Minimum Acceptance Criteria as a Condition of Substantial Completion. As a
condition of achieving Substantial Completion, each and every Unit shall achieve
all Minimum Acceptance Criteria as described in greater detail in this
Section 12.4. The Performance Tests for determining whether a Unit achieves the
Minimum Acceptance Criteria are described in Attachment S and Attachment T.

A. Minimum Acceptance Criteria Not Achieved. In the event that any Unit fails to
achieve any of the Minimum Acceptance Criteria, as evidenced by the Performance
Test results, then (i) Substantial Completion shall not occur and (ii) the
provisions of Section 14.1 shall apply after the Guaranteed Substantial
Completion Date passes without achievement of Substantial Completion. In
addition to the foregoing, Contractor shall attempt for a period of one hundred
eighty (180) Days (commencing on the date on which the Unit was shown, through
the Performance Tests, to have failed to achieve one or more of the Minimum
Acceptance Criteria) (“Minimum Acceptance Criteria Correction Period”) to
correct the Work to enable the Unit to achieve all of the Minimum Acceptance

 

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Criteria. If the Unit has not achieved all of the Minimum Acceptance Criteria
upon the termination of the Minimum Acceptance Criteria Correction Period, then
Owner may, in its sole discretion, either (i) grant Contractor an additional
Minimum Acceptance Criteria Correction Period under the same terms and
conditions as the first, including the application of Section 14.1, or
(ii) terminate Contractor for Default, in which case Owner shall be entitled to
any and all damages, losses, costs and expenses to the extent permitted under
Section 17.1. If, on the other hand, the Unit has achieved all of the Minimum
Acceptance Criteria during the Minimum Acceptance Criteria Correction Period (or
during the second period, should Owner elect that option), then Contractor shall
remain liable to Owner for Substantial Completion Delay Liquidated Damages
pursuant to the Agreement and any other damages, costs or expenses for which
Contractor is responsible hereunder.

B. Access During Minimum Acceptance Criteria Correction Period. During any
Minimum Acceptance Criteria Correction Period, Owner shall provide Contractor
with access to the Work sufficient to perform its curative Work under this
Agreement, subject to any reasonable security or safety requirements of Owner;
provided, however, Owner shall be under no obligation to provide any access to
Contractor that would interfere with the operation of the Mirant Delta Facility;
provided further, however, if the Guaranteed Substantial Completion Date has
passed and thereafter if Owner denies Contractor access to the Unit (or Units)
that have failed to meet the Minimum Acceptance Criteria to the extent necessary
for Contractor to perform its curative Work, then Contractor shall not be liable
for Substantial Completion Delay Liquidated Damages for each Day that Owner so
denies Contractor such access for performance of curative Work. Contractor shall
provide at least one (1) week’s prior written notice to Owner if performance of
the curative Work could interfere with the operation of the Mirant Delta
Facility, in which case Owner may place reasonable limitations on Contractor’s
access to the Facility such that performance of the Work will cause no
disruption to the operation of the Mirant Delta Facility.

C. Delivery of Critical Spare Parts. Notwithstanding the timing of the delivery
of operating spare parts under Section 3.4, Contractor shall deliver all
Critical Spare Parts no later than the date upon which Contractor achieves
Substantial Completion; provided, however, delivery of such Critical Spare Parts
shall not be a condition of achievement of Substantial Completion by Contractor.
Nevertheless, if Contractor fails to deliver any such Critical Spare Part by
Substantial Completion, and thereafter such Critical Spare Part is necessary in
order for the Facility to be fully available for commercial operation (as
required by CAISO and/or NERC standards), then Contractor shall be liable to
Owner for Substantial Completion Delay Liquidated Damages for each Day the
Facility is not fully available as a result of such failure to provide such
Critical Spare Part until such Critical Spare Part is delivered to the Facility.
Such Substantial Completion Delay Liquidated Damages will be assessed in the
same manner as if Contractor failed to achieve Substantial Completion by the
Guaranteed Substantial Completion Date in accordance with Section 14.1, with the
amount of the Substantial Completion Delay Liquidated Damages to be assessed
against Contractor (on a per Day basis) being dependent upon the month(s) in
which the Facility is not fully available for commercial operation due to the
lack of such Critical Spare Part. For purposes of clarity, and by way of example
and explanation only, if Contractor failed to timely provide a Critical Spare
Part and the

 

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Facility was not fully available for commercial operation during the month of
June due to the lack of such Critical Spare Part, then Contractor would be
assessed Substantial Completion Delay Liquidated Damages in accordance with the
amounts set forth in Section 14.1D.

12.5 Punchlist.

A. Punchlist for Mechanical Completion. Prior to Mechanical Completion for each
system or subsystem of the Facility, as applicable, Owner and Contractor shall
inspect such Work, and Contractor shall prepare a proposed Punchlist of items
identified as needing to be completed or corrected as a result of such
inspection. Contractor shall promptly provide the proposed Punchlist to Owner
for its review, together with an estimate of the time necessary to complete or
correct each Punchlist item. Contractor shall add to the proposed Punchlist any
Punchlist items that are identified by Owner during its review, and Contractor
shall immediately initiate measures to complete or correct, as appropriate, any
item on Contractor’s proposed Punchlist that Owner, in the exercise of its
reasonable judgment, believes must be completed or corrected so that such Work
will achieve Mechanical Completion. Upon Contractor’s completion or correction
of any items necessary to achieve Mechanical Completion, such Punchlist shall
govern Contractor’s performance of the Punchlist items for such system or
subsystem of the Facility, as applicable, up to Substantial Completion.

B. Punchlist for Substantial Completion. After Mechanical Completion of the
Facility and prior to Substantial Completion, Owner and Contractor shall inspect
the entire Work, and Contractor shall prepare an updated and revised proposed
Punchlist of items identified as needing to be completed or corrected as a
result of such inspection. Contractor shall promptly provide the proposed,
updated and revised Punchlist to Owner for its review and written approval,
together with an estimate of the time and cost necessary to complete or correct
each Punchlist item. Contractor shall add to the proposed, updated and revised
Punchlist any Punchlist items that are identified by Owner during its review,
and Contractor shall immediately initiate measures to complete or correct, as
appropriate, any item on Contractor’s proposed, updated and revised Punchlist or
otherwise that Owner in the exercise of its reasonable judgment, believes must
be completed or corrected to achieve Substantial Completion. Upon Contractor’s
completion or correction of any items necessary to achieve Substantial
Completion and Owner’s written approval of Contractor’s proposed Punchlist (such
approval not to be unreasonably withheld), such Punchlist shall govern
Contractor’s performance of the Punchlist items up to Final Completion. All Work
on the Punchlist shall be completed within ninety (90) Days after achievement of
Substantial Completion, or Owner may, in addition to any other rights that it
may have under this Agreement, at law or in equity, complete such Punchlist Work
at the expense of Contractor. In the event Owner elects to complete such
Punchlist Work, Contractor shall immediately pay Owner (directly or by offset,
at Owner’s sole discretion) all costs and expenses incurred in performing such
Punchlist Work. Upon Contractor’s request, Owner shall provide documentation
identifying the costs incurred to perform such Punchlist Work.

 

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12.6 Notice and Requirements for Final Completion. Final Completion shall be
achieved when all requirements for Final Completion under this Agreement,
including those set forth in the definition of Final Completion under
Section 1.1, have been satisfied. Upon Final Completion, Contractor shall
certify to Owner in the form of Attachment N (“Final Completion Certificate”)
that all of the requirements under this Agreement for Final Completion have
occurred. Owner shall notify Contractor whether it accepts or rejects the Final
Completion Certificate within fifteen (15) Days following Owner’s receipt
thereof. Acceptance of such certificate shall be evidenced by Owner’s signature
on such certificate, which shall be forwarded to Contractor with such notice. If
Owner does not agree that Final Completion has occurred, then Owner shall state
the basis for its rejection in reasonable detail in a written notice provided to
Contractor. The Parties shall thereupon promptly and in good faith confer and
make all reasonable efforts to resolve such issue. In the event such issue is
not resolved within ten (10) Business Days of the delivery by Owner of its
notice, Owner and Contractor shall resolve the Dispute in accordance with the
dispute resolution procedures provided for under Article 19; provided, however,
if such deficiencies relate to the failure to complete Punchlist items, Owner
may, in addition to any other rights that it may have under this Agreement, at
law or in equity, complete such Punchlist Work at the expense of Contractor in
accordance with Section 12.5.

12.7 Performance Guarantees as a Condition of Final Completion. As a condition
of achieving Final Completion, each and every Unit shall achieve all Performance
Guarantees and the Starting Reliability Requirement as described in greater
detail in this Section 12.7. The Performance Tests for determining whether a
Unit achieves the Performance Guarantees and the Starting Reliability
Requirement are described in Attachment S and Attachment T.

A. Performance Guarantees Not Achieved. In the event that any Unit meets all of
the Minimum Acceptance Criteria but fails to achieve one or more of the
Performance Guarantees, as evidenced by the Performance Test results, then, at
Contractor’s election, Contractor shall, with respect to each Performance
Guarantee not achieved: (i) pay (directly, by offset, or by collection on the
Contractor Letter of Credit, at Owner’s sole discretion) to Owner the applicable
Performance Liquidated Damages for such Performance Guarantee; or (ii) take
corrective actions to achieve such Performance Guarantee, provided that in the
event such corrective actions do not result in the achievement of such
Performance Guarantee within one hundred eighty (180) Days after achievement of
Substantial Completion (or such longer period as Owner may allow), then
Contractor shall pay (directly, by offset, or by collection on the Contractor
Letter of Credit, at Owner’s sole discretion) to Owner the applicable
Performance Liquidated Damages; provided further, however, in Owner’s reasonable
discretion and in lieu of Contractor’s decision to pay Performance Liquidated
Damage pursuant to clause (i) or (ii) above, Owner may require Contractor to
perform curative Work in an attempt to achieve the failed Performance
Guarantee(s), in which case all reasonable, direct costs incurred by Contractor
in the performance of the curative Work, up to the value of the foregone
Performance Liquidated Damages, shall be borne by Contractor and all reasonable,
direct costs incurred by Contractor thereafter for the curative Work shall be
reimbursed by Owner. The Performance Liquidated Damages shall be calculated in
accordance with Attachment T.

 

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B. Access During Performance of Curative Work. During any period of time in
which Contractor is attempting to perform curative Work to achieve the
Performance Guarantees as set forth in Section 12.7A, Owner shall provide
Contractor with reasonable access to the applicable Unit sufficient for
Contractor to perform its curative Work, subject to any reasonable security or
safety requirements of Owner; provided, however, Owner shall be under no
obligation to provide any access to Contractor that would interfere with the
operation of the Facility or the Mirant Delta Facility; provided further,
however, that if Owner denies Contractor reasonable access to the applicable
Unit, then Contractor shall be entitled to an extension to the 180-Day period
set forth in Section 12.7A for each Day that Owner so denies Contractor such
reasonable access. Any such extension shall be set forth in a Change Order
executed by the Parties. Contractor shall provide at least one (1) week’s prior
written notice to Owner if performance of the curative Work could interfere with
the operation of the Facility or the Mirant Delta Facility, in which case Owner,
in its sole discretion, may place reasonable limitations on Contractor’s access
to the Facility such that performance of the Work will cause no disruption to
the operation of the Facility or the Mirant Delta Facility at the Site and no
unreasonable loss of revenue to Owner.

C. Starting Reliability Requirement. In the event that any Unit fails to achieve
the Starting Reliability Requirement, as evidenced by the Performance Test
results for the Starting Reliability Requirement, then such failure shall be
considered a Defect in accordance with Article 13 and Contractor and Owner shall
have the rights and obligations set forth therein with respect to correcting
such Defect. For the avoidance of doubt, achievement of the Starting Reliability
Requirement is a material obligation under the Agreement.

12.8 ***

12.9 Partial Occupancy and Use. Prior to Contractor’s achieving Substantial
Completion, Owner may occupy or use all or any portion of the Work then capable
of functioning safely, provided that such occupancy or use is authorized by the
Governmental Instrumentality and Owner’s insurance company or companies
providing property insurance and builder’s risk coverage have consented to such
partial occupancy or use. Contractor shall assist Owner and take reasonable
steps in obtaining consent of the insurance company or companies and applicable
Government Instrumentalities. Immediately prior to such partial occupancy or
use, Owner and Contractor shall jointly inspect the area to be occupied or
portion of the Work to be used in order to determine and record the condition of
the Work and all personnel and environmental safety aspects of the Work. Such
occupancy or use shall not in any way release Contractor or any surety of
Contractor from any obligations or liabilities pursuant to this Agreement,
including the obligation to engineer, procure and construct the Facility in
accordance with all requirements of this Agreement; provided, however,
Contractor shall be entitled to a Change Order for an extension to the Key
Milestone Schedule, Guaranteed Substantial Completion Date and Required Final
Completion Date, and adjustment to the Contract Price, to the extent Owner’s
partial occupancy or use of the Facility delays the prosecution or completion of
the Work, or increases Contractor’s cost of performing the Work, and Contractor
satisfies the requirements for such time extension and Contract Price adjustment
pursuant to Section 6.8. Such occupancy or use shall not be deemed to be an
acceptance by Owner of such portion of the Facility.

 

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12.10 Long-Term Obligations. No acceptance by Owner of any or all of the Work or
any other obligations of Contractor under this Agreement, including acceptance
of Mechanical Completion, Substantial Completion or Final Completion, nor any
payment made hereunder, whether an interim or final payment, shall in any way
release Contractor or any surety of Contractor from any obligations or liability
pursuant to this Agreement, including obligations with respect to unperformed
obligations of this Agreement or for any Work that does not conform to the
requirements of this Agreement, including Warranty obligations, any liabilities
for which insurance is required or any other responsibility of Contractor,
including the payment of any and all fines and penalties assessed as a result of
Contractor’s failure to comply with any Applicable Law. It is expressly
understood and agreed by the Parties that nothing in this Article 12 shall in
any way modify or alter Contractor’s obligations under Article 13 and Article 14
hereof.

ARTICLE 13

WARRANTY AND CORRECTION OF WORK

13.1 Warranty.

A. General. The warranties set forth in this Article 13 (collectively, the
“Warranty” or “Warranties”) are in addition to any of the Minimum Acceptance
Criteria or Performance Guarantees set forth in this Agreement. Any Work, or
component thereof, that is not in conformity with any Warranty is defective
(“Defective”) and contains a defect (“Defect”).

B. Warranty of Work. Contractor hereby warrants that the Work, including
Equipment, and each component thereof shall be:

1. new, complete, and of suitable grade for the intended function and use;

2. in accordance with all of the requirements of this Agreement, including in
accordance with GECP, Applicable Law and Applicable Codes and Standards;

3. free from encumbrances to title, as set forth in greater detail in
Section 9.1; and

4. free from defects in design, material and workmanship.

C. Assignment and Enforcement of Subcontractor Warranties. Contractor shall,
without additional cost to Owner, obtain warranties from Subcontractors and
Sub-subcontractors that meet or exceed the requirements of this Agreement;
provided, however, Contractor shall not in any way be relieved of its
responsibilities and liability to Owner under this Agreement, regardless of
whether such Subcontractor or Sub-subcontractor warranties meet the requirements
of this Agreement, as Contractor shall be fully responsible and liable to Owner
for its Warranty and Corrective Work obligations and liability under this
Agreement for all Work. All such warranties shall be deemed to run to the
benefit of Owner and Contractor. Such warranties, with duly executed instruments
assigning the warranties to Owner, shall be delivered to Owner upon Substantial

 

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Completion. All warranties provided by any Subcontractor or Sub-subcontractor
shall be in such form as to permit direct enforcement by Contractor or Owner
against any Subcontractor or Sub-subcontractor whose warranty is called for, and
Contractor agrees that: (i) Contractor’s Warranty, as provided under this
Article 13, shall apply to all Work regardless of the provisions of any
Subcontractor or Sub-subcontractor warranty, and such Subcontractor or
Sub-subcontractor warranties shall be in addition to, and not a limitation of,
such Contractor Warranty; (ii) Contractor is jointly and severally liable with
such Subcontractor or Sub-subcontractor with respect to such Subcontractor or
Sub-subcontractor warranty; and (iii) service of notice on Contractor that there
has been a breach of a Subcontractor or Sub-subcontractor warranty shall be
sufficient to invoke the terms of the instrument. This Section 13.1C shall not
in any way be construed to limit Contractor’s liability under this Agreement for
the entire Work or its obligation to enforce Subcontractor warranties.

D. Exceptions to Warranty. The Warranty excludes remedy, and Contractor shall
have no liability to Owner, for damage or defect to the extent caused by:
(i) improper repairs or alterations, misuse, neglect or accident by Owner;
(ii) operation, maintenance or use of Work or any component thereof in a manner
not in compliance with a material requirement of operation and maintenance
manuals delivered by Contractor to Owner; or (iii) normal wear and tear.

13.2 Inspection.

A. General Rights. All Work shall be subject to inspection by Owner, Lender and
either of their representatives at all times to determine whether the Work
conforms to the requirements of this Agreement. Contractor shall furnish Owner,
Lender and either of their representatives with access to all locations where
Work is in progress, including locations not on the Site. Prior to Substantial
Completion, if any Work is Defective, then Contractor shall, at its own expense,
promptly correct such Defective Work and any other portions of the Facility
damaged or affected by such Defective Work, whether by repair, replacement or
otherwise (including any and all obligations in connection with such repair,
modification, re-performance or replacement, such as in and out costs,
transportation costs, and any other costs necessary to fully correct the Work).
Subject to Contractor’s right to pursue a dispute under Article 19, the decision
of Owner shall be conclusive as to whether the Work is conforming or Defective,
and Contractor shall comply with the instructions of Owner in all such matters
while pursuing any such dispute. If it is later determined that the Work was not
Defective, then Owner shall reimburse Contractor for all costs incurred in
connection with such repair or replacement and a Change Order shall be issued
for such amount and shall address any impact the repair or replacement may have
had on the Key Milestone Schedule, Guaranteed Substantial Completion Date and
Required Final Completion Date, as applicable. If Contractor fails, after a
reasonable period of time not to exceed one (1) week, to repair or replace any
Defective Work, or to commence to repair or replace any Defective Work and
thereafter continue to proceed diligently to complete the same, then Owner may
repair or replace such Defective Work and the expense thereof shall be paid by
Contractor (whether directly, by offset, or collection on the Contractor Letter
of Credit, at Owner’s sole discretion).

 

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B. Witness Points. Contractor shall provide Owner a proposed list of witness
points for each item of Equipment for Owner’s review and prior written approval
no later than thirty (30) Days’ after placement of the applicable Subcontract
for such item of Equipment (or, with respect to the Siemens Contract, thirty
(30) Days after the Effective Date), and Owner shall notify Contractor which of
the witness points it or its Lenders’ representatives wish to witness.
Contractor shall provide Owner with at least five (5) Business Days’ prior
written notice of the actual scheduled date of each of the tests Owner has
indicated it or its Lenders’ representatives wish to witness. Contractor shall
cooperate with Owner if Owner or its Lenders’ representatives elect to witness
any additional tests, and Contractor acknowledges that Owner and its Lenders’
representatives shall have the right to witness all tests being performed in
connection with the Work. Owner’s rights of inspection (and the rights given to
the Lenders’ representatives) as set forth herein apply only to their witnessing
of witness points for Equipment and shall not be construed to imply a limitation
on Owner’s right to inspect any portion on the Work (including Equipment) at any
time in accordance with this Agreement.

C. No Obligation to Inspect. Owner’s or Lender’s right to conduct inspections
under Sections 13.2A and 13.2B shall not obligate Owner or Lender to do so.
Neither the exercise of Owner or Lender of any such right, nor any failure on
the part of Owner or Lender to discover or reject Defective Work shall be
construed to imply an acceptance of such Defective Work or a waiver of such
Defect.

D. Cost of Disassembling. The cost of disassembling, dismantling or making safe
finished Work for the purpose of inspection, and reassembling such portions (and
any delay associated therewith) shall be borne by Owner if such Work is found to
conform with the requirements of this Agreement and by Contractor if such Work
is found to be Defective.

13.3 Correction of Work After Substantial Completion. If, after Substantial
Completion but prior to the expiration of the Defect Correction Period, any Work
is found to be Defective, Contractor shall, at its sole cost and expense,
immediately and on an expedited basis (i) correct such Defective Work, whether
by repair, replacement or otherwise, as determined by Contractor (including any
and all obligations in connection with such repair, modification, re-performance
or replacement of the Defect, such as in and out costs, transportation costs,
and any other costs necessary to fully correct the Defective Work) and
(ii) subject to Contractor’s limitations of liability set forth in Section 9.2B,
correct, and, if Owner performs any or all of the correction, be liable for
Owner’s costs and expenses to correct, any other portions of the Facility
damaged or affected by such Defective Work, whether by repair, replacement or
otherwise (collectively, clauses (i) and (ii) shall be the “Corrective Work”).
Owner shall provide Contractor with access to the Facility sufficient to perform
its Corrective Work, so long as such access does not unreasonably interfere with
the construction or operation of the Facility or the Mirant Delta Facility and
subject to any reasonable security or safety requirements of Owner. In the event
Contractor utilizes spare parts owned by Owner in the course of performing the
Corrective Work, Contractor shall supply Owner free of charge with new spare
parts equivalent in quality and quantity to all such spare parts used by
Contractor as soon as possible following the utilization of such spare parts.

 

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A. Owner Right to Correct or Complete Defective Work. If Contractor fails to
commence the Corrective Work within a reasonable period of time not to exceed
ten (10) Days, or does not complete such Corrective Work on an expedited basis,
then Owner, by written notice to Contractor, may (in addition to any other
remedies that it has under this Agreement) correct such Defective Work, and
Contractor shall be liable to Owner for all reasonable costs and expenses
incurred by Owner in connection with correcting such Defective Work and arising
out of or relating to such Defective Work and shall pay Owner (directly, by
offset or by collection on the Contractor Letter of Credit, at Owner’s sole
discretion) an amount equal to such reasonable costs and expenses; provided,
however, if such Defective Work materially affects the construction, operation
or use of any of the Work or the Facility or the Mirant Delta Facility or
presents an imminent threat to the safety or health of any Person and Owner
knows of such Defective Work, Owner may (in addition to any other remedies that
it has under this Agreement) correct such Defective Work without giving prior
written notice to Contractor (but shall give prompt notice to Contractor
thereafter), and, in such event, Contractor shall be liable to Owner for all
reasonable costs and expenses incurred by Owner in connection with correcting
such Defective Work and arising out of or relating to such Defective Work and
shall pay Owner (directly, by offset or by collection on the Contractor Letter
of Credit, at Owner’s sole discretion) an amount equal to such reasonable costs
and expenses (which costs and expenses shall be adequately documented and
supported by Owner).

B. Standards for Corrective Work. All Corrective Work shall be performed subject
to the same terms and conditions under this Agreement as the original Work is
required to be performed. Any change to parts or Equipment that would alter the
requirements of this Agreement may be made only with prior written approval of
Owner.

C. Subject to Section 13.4, nothing contained in this Section 13.3 shall be
construed to establish a period of limitation with respect to other obligations
which Contractor might have under the Agreement.

13.4 Exclusivity. ***

13.5 Assignability of Warranties. The Warranties made in this Agreement shall be
for the benefit of Owner and its successors and assigns and the respective
successors and assigns of any of them, and are fully transferable and
assignable.

ARTICLE 14

SUBSTANTIAL COMPLETION DELAY LIQUIDATED DAMAGES AND PAYMENT OF LIQUIDATED
DAMAGES

14.1 Delay in Substantial Completion. If Substantial Completion for the Facility
occurs after the Guaranteed Substantial Completion Date, Contractor shall pay to
Owner delay liquidated damages (the “Substantial Completion Delay Liquidated
Damages”) in the amounts for each full Day of delay until Substantial Completion
occurs: ***.

14.2 Suspension or Cessation of Substantial Completion Delay Liquidated Damages.
Notwithstanding the assessment of Substantial Completion Delay Liquidated
Damages

 

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in accordance with Section 14.1, but subject always to the assessment of
Substantial Completion Delay Liquidated Damages in accordance with
Section 12.4C, Substantial Completion Delay Liquidated Damages shall cease to
accrue, even though Substantial Completion has not yet been achieved, (i) on an
on-going, permanent basis starting upon the earlier of the Day that (a) Owner is
notified in writing by PG&E that PG&E has certified the Facility to have
achieved commercial operation under the power purchase agreement between Owner
and PG&E or (b) the Facility has been placed in commercial operation (for
operation other than for commissioning, testing or tuning), whether under the
power purchase agreement between Owner and PG&E or any other commercial
arrangement, for more than one hundred (100) Equivalent Operating Hours in the
aggregate and (ii) on a temporary basis, for any particular Day in which the
Facility is placed into commercial operation (for operation other than for
commissioning, testing or tuning) under the power purchase agreement between
Owner and PG&E or any other commercial arrangement.

14.3 Payment of Liquidated Damages. With respect to any Liquidated Damages that
accrue, Owner, at its sole discretion, may either (i) invoice Contractor for
such owed Liquidated Damages, and within thirty (30) Days of Contractor’s
receipt of such invoice, Contractor shall pay Owner Liquidated Damages,
(ii) withhold from Contractor amounts that are otherwise due and payable to
Contractor in the amount of such Liquidated Damages, or (iii) collect on the
Contractor Letter of Credit in the amount of such Liquidated Damages.

ARTICLE 15

CONTRACTOR’S REPRESENTATIONS

Contractor represents and warrants that:

15.1 Corporate Standing. It is a corporation duly organized, validly existing
and in good standing under the laws of Delaware, is authorized and qualified to
do business in all jurisdictions in which the nature of the business conducted
by it makes such qualification necessary and where failure so to qualify would
have a material adverse effect on its financial condition, operations,
prospects, taxes or business.

15.2 No Violation of Law; Litigation. It is not in violation of any Applicable
Law or judgment entered by any Governmental Instrumentality, which violations,
individually or in the aggregate, would affect its performance of any
obligations under this Agreement. There are no legal or arbitration proceedings
or any proceeding by or before any Governmental Instrumentality, now pending or
(to the best knowledge of Contractor) threatened against Contractor that, if
adversely determined, could reasonably be expected to have a material adverse
effect on the financial condition, operations, prospects or business, as a
whole, of Contractor, or its ability to perform under this Agreement.

15.3 Licenses. It is the holder of, or will take the necessary action to obtain,
all Permits required for Contractor to obtain under this Agreement or otherwise
necessary to permit it to operate or conduct its business as contemplated by
this Agreement.

15.4 No Breach. Neither the execution and delivery of this Agreement, nor the
consummation of the transactions herein contemplated or compliance with the
terms and provisions hereof will conflict with or result in a breach of, or
require any consent under, the

 

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charter or by-laws of Contractor, or any Applicable Law or regulation, or any
order, writ, injunction or decree of any court, or any agreement or instrument
to which Contractor is a party or by which it is bound or to which it or any of
its property or assets is subject, or constitute a default under any such
agreement or instrument.

15.5 Corporate Action. It has all necessary power and authority to execute,
deliver and perform its obligations under this Agreement; the execution,
delivery and performance by Contractor of this Agreement has been duly
authorized by all necessary action on its part; and this Agreement has been duly
and validly executed and delivered by Contractor and constitutes a legal, valid
and binding obligation of Contractor enforceable in accordance with its terms,
except as the enforceability thereof may be limited by bankruptcy, insolvency,
reorganization or moratorium or other similar laws relating to the enforcement
of creditors’ rights generally.

15.6 Financial Solvency. It is financially solvent, able to pay all debts as
they mature and possesses sufficient working capital to complete the Work and
perform its obligations hereunder.

ARTICLE 16

OWNER’S REPRESENTATIONS

Owner represents and warrants that:

16.1 Corporate Standing. It is a limited liability company duly organized,
validly existing and in good standing under the laws of Delaware, is qualified
to do business in all jurisdictions in which the nature of the business
conducted by it makes such qualification necessary and where failure so to
qualify would have a material adverse effect on its financial condition,
operations, prospects or business.

16.2 No Violation of Law; Litigation. It is not in violation of any Applicable
Law, or judgment entered by any Governmental Instrumentality, which violations,
individually or in the aggregate, would affect its performance of any
obligations under this Agreement. There are no legal or arbitration proceedings
or any proceeding by or before any Governmental Instrumentality, now pending or
(to the best knowledge of Owner) threatened against Owner that, if adversely
determined, could reasonably be expected to have a material adverse effect on
the financial condition, operations, prospects or business, as a whole, of
Owner, or its ability to perform under this Agreement.

16.3 Licenses. It is the holder of, or will take the necessary action to obtain,
all Permits required for Owner to obtain under this Agreement.

16.4 No Breach. Neither the execution and delivery of this Agreement, nor the
consummation of the transactions herein contemplated or compliance with the
terms and provisions hereof and thereof will conflict with or result in a breach
of, or require any consent under, the operating agreement or by-laws of Owner,
any Applicable Law, any order, writ, injunction or decree of any court, or any
agreement or instrument to which Owner is a party or by which it is bound or to
which it or any of its property or assets is subject, or constitute a default
under any such agreement or instrument.

 

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16.5 Corporate Action. It has all necessary power and authority to execute,
deliver and perform its obligations under this Agreement; the execution,
delivery and performance by Owner of this Agreement has been duly authorized by
all necessary action on its part; and this Agreement has been duly and validly
executed and delivered by Owner and constitutes a legal, valid and binding
obligation of Owner enforceable in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, reorganization
or moratorium or other similar laws relating to the enforcement of creditors’
rights generally.

ARTICLE 17

DEFAULT, TERMINATION AND SUSPENSION

17.1 Default by Contractor.

A. Events of Default. If Contractor shall at any time (i) materially fail to
prosecute the Work in accordance with the Agreement; (ii) abandon the Work;
(iii) fail to comply with Sections 10.2, 10.3, 12.4A, 22.7, or 22.8; (iv) fail
to maintain insurance required under this Agreement; (v) fail to discharge liens
filed by any Subcontractor or Sub-subcontractor as required under this
Agreement; (vi) cause, by any action or omission, any material stoppage or delay
of or interference with the work or operations of Owner or its other contractors
or subcontractors; (vii) have a material violation of Applicable Law or
Applicable Codes and Standards; (viii) materially fail to comply with any
provision of this Agreement; (ix) fail to develop a Recovery Schedule in
accordance with Section 5.5; (x) after a Recovery Schedule is implemented in
accordance with Section 5.5, (a) update the Monthly Updated CPM Schedule showing
completion of any remaining Key Milestone to be delayed beyond the applicable
Key Milestone Date by more than the number of Days set forth in column 4 of
Attachment E for such Key Milestone or (b) fail to provide an updated Monthly
Updated CPM Schedule to the Owner in accordance with the Agreement and Owner
notifies Contractor in writing that it has reasonably determined (based upon
objective criteria) that achievement of any Key Milestone will be delayed beyond
the applicable Key Milestone Date by more than the number of Days set forth in
column 4 of Attachment E for such Key Milestone; (xi) fail to complete a Key
Milestone within the number of Days set forth in column 4 of Attachment E after
the passing of the applicable Key Milestone Date; or (xii) itself, or Kiewit
Construction Company, becomes insolvent, has a receiver appointed, makes a
general assignment or filing for the benefit of its creditors or files for
bankruptcy protection, or be unable to pay its debts when due (each of the
foregoing in clauses (i) through (xii) being a “Default”), then Owner may
provide Contractor with written notice that Contractor is in Default; provided,
however, Contractor shall not be considered in Default under clause (x) or
(xi) above if Contractor can reasonably demonstrate to Owner, via the Monthly
Updated CPM Schedule developed in accordance with the requirements of this
Agreement (including GECP), that Contractor will achieve Substantial Completion
no later than the number of Days set forth in column 4 of Attachment E beyond
the Guaranteed Substantial Completion Date for the Key Milestone in column 1 of
Attachment E which has been missed (per clause (xi) above) or which is scheduled
to be missed (per clause (x) above); provided further, however, if two or more
Key Milestones are delayed such that Contractor would otherwise be considered in
Default in accordance with clause (x) or (xi) above, then the longest applicable
duration in column 4 of Attachment E for the delayed Key Milestones shall
determine the number of

 

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Days within which Contractor must reasonably demonstrate to Owner that
Substantial Completion will be achieved after the Guaranteed Substantial
Completion Date in order to avoid being considered in Default under this
Section 17.1A. ***.

B. Cure Period for Defaults and Termination for Default. With respect to a
Default under any of clauses (i), (ii), (iv), (vi), (vii), (viii) and (ix) in
Section 17.1A, and following Owner’s written notice to Contractor specifying the
general nature of such Default, Contractor shall cure such Default within thirty
(30) Days, or if the Default cannot be cured with the exercise of reasonable
diligence within such thirty (30) Days, Contractor shall immediately commence
corrective action and cure such Default as expeditiously as feasible given the
nature of the Default and the cure. If (i) Contractor fails to cure a Default
occurring under any of the aforementioned clauses in accordance with the
preceding sentence, or (ii) Contractor is in Default pursuant to clause (iii),
(v), (x), (xi) or (xii) of Section 17.1A, then Owner, at its sole discretion and
without prejudice to any other rights that it has under this Agreement, at law
or in equity and without further notice to Contractor, may (1) take such steps
as are necessary to overcome the Default condition, in which case Contractor
shall be liable to Owner for any and all costs, damages, losses and expenses
(including all attorneys’ fees, consultant fees and litigation expenses)
incurred by Owner in connection therewith, (2) terminate for Default
Contractor’s performance of all or any part of the Work, or (3) seek specific
performance or interlocutory mandatory injunctive relief requiring performance
of Contractor’s obligations, it being agreed by Contractor that such relief may
be necessary to avoid irreparable harm to Owner. Notwithstanding the foregoing,
if the Guaranteed Substantial Completion Date has passed, Contractor shall not
be considered in Default pursuant to clause (x) or (xi) of Section 17.1A as long
as Contractor is paying Substantial Completion Delay Liquidated Damages and has
not reached its limitation of liability for such Substantial Completion Delay
Liquidated Damages pursuant to Section 21.2A; provided, however, that after
Contractor has paid Substantial Completion Delay Liquidated Damages up to the
limitation of liability set forth in Section 21.2A, or if Contractor fails to
pay Substantial Completion Delay Liquidated Damages when due, and Substantial
Completion has not been achieved, Owner shall have the right to declare
Contractor in Default pursuant to clause (x) or (xi) of Section 17.1A (as
applicable).

C. Additional Rights of Owner Upon Termination. In the event that Owner
terminates this Agreement for Default in accordance with Section 17.1A, Owner
may, at its sole option, (i) enter onto the Site and, for the purpose of
completing the Work, take possession of the information, documents and Books and
Records for the Work, (ii) take assignment of any or all of the Subcontracts,
and/or (iii) complete the Work either itself or through others. Contractor shall
leave all third-party rented equipment, materials, tools, supplies, scaffolding,
machinery and other items at the Site in place upon a termination in accordance
with Section 17.1A unless otherwise requested by Owner and shall cooperate with
such third-party rentors in the assignment of the rental Subcontract to Owner.
If the unpaid balance of the Contract Price shall exceed all damages, costs,
losses and expenses incurred by Owner (including all attorneys’ fees, consultant
fees and litigation expenses, costs to complete the Work, Liquidated Damages and
any and all damages for failure of performance and cost of financing or interest
on such expense from the date such expense was incurred by Owner at the rate
specified in Section 7.7), then such excess shall be paid

 

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by Owner to Contractor, but such amount shall not be paid until after Final
Completion has been achieved. If such amount incurred by Owner shall exceed the
unpaid balance of the Contract Price, then, at Owner’s sole option, Contractor
shall pay Owner the difference on demand, or Owner shall have the right and
authority to offset or collect on the Contractor Letter of Credit in the amount
of such difference. While subject to Contractor’s limitations of liability under
Article 21, Contractor’s liability under this Section 17.1C is in addition to
any other liability provided for under this Agreement and Owner shall have the
right and authority to set off against and deduct from any such excess due
Contractor by Owner any other liability of Contractor to Owner under this
Agreement. Owner agrees to act reasonably to mitigate any costs it might incur
in connection with any termination for Default. In the event of a termination
for Default, the Parties agree that Owner shall be entitled to any and all
damages, losses, costs and expenses incurred by Owner arising out of or
resulting from such Default, including any and all Liquidated Damages; provided
that Contractor’s aggregate liability shall apply to the extent provided by
Section 21.1. If Contractor is terminated for Default pursuant to Section 17.1,
the Parties agree that, for purposes of this Section 17.1C, and with respect to
Substantial Completion that was not achieved by Contractor prior to such
termination, Substantial Completion Delay Liquidated Damages owed by Contractor
to Owner shall be based on the date that the substitute contractor achieved
Substantial Completion.

D. Erroneous Termination for Default. If any termination for Default by Owner is
found to be not in accordance with the provisions of this Agreement or is
otherwise deemed to be unenforceable, then such termination for Default shall be
deemed to be a termination for convenience as provided in Section 17.2.

E. Obligations Upon Termination. Upon termination for Default, Contractor shall
(i) immediately discontinue Work on the date and to the extent specified in the
notice, (ii) place no further orders for Subcontracts, Equipment, or any other
items or services except as may be necessary for completion of such portion of
the Work as is not discontinued, (iii) inventory, maintain and leave on-Site all
third-party equipment, machinery, materials, tools, supplies and scaffolding
rented by Contractor or provided by Owner for performance of the terminated
Work, (iv) promptly make every reasonable effort to procure assignment or
cancellation upon terms satisfactory to Owner of all Subcontracts and rental
agreements to the extent they relate to the performance of the Work that is
discontinued; (v) cooperate with Owner in the transfer of Work Product,
including Drawings and Specifications, Permits, licenses and any other items or
information and disposition of Work in progress so as to mitigate damages;
(vi) if requested by Owner in writing, assign the PLA to Owner or such other
Person as directed by Owner; (vii) comply with other reasonable requests from
Owner regarding the terminated Work; (viii) thereafter execute only that portion
of the Work not terminated (if any) and that portion of the Work as may be
necessary to preserve and protect Work already in progress and to protect
Equipment at the Site or in transit thereto, and to comply with any Applicable
Law and any Applicable Codes and Standards; and (ix) perform all other
obligations under Section 17.1C.

17.2 Termination for Convenience by Owner. Owner shall have the right to
terminate for convenience Contractor’s performance of all or any part of the
Work by providing Contractor

 

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with a written notice of termination, to be effective upon receipt by
Contractor. Upon termination for convenience, Contractor shall (i) immediately
discontinue the Work on the date and to the extent specified in such notice,
(ii) place no further orders for Subcontracts, Equipment, or any other items or
services except as may be necessary for completion of such portion of the Work
as is not discontinued, (iii) promptly make every reasonable effort to procure
cancellation upon terms satisfactory to Owner of all Subcontracts and rental
agreements to the extent they relate to the performance of the Work that is
discontinued unless Owner elects to take assignment of any such Subcontracts,
(iv) assist Owner in the maintenance, protection, and disposition of Work in
progress, (v) cooperate with Owner for the efficient transition of the Work,
(vi) cooperate with Owner in the transfer of Work Product, including Drawings
and Specifications, Permits, licenses and any other items or information and
disposition of Work in progress, (vii) if requested by Owner in writing, assign
the PLA to Owner or such other Person as directed by Owner and (viii) thereafter
execute only that portion of the Work not terminated (if any) and that portion
of the Work as may be necessary to preserve and protect Work already in progress
and to protect Equipment at the Site or in transit thereto, and to comply with
any Applicable Law and Applicable Codes and Standards and Owner may, at its sole
option, take assignment of any or all of the Subcontracts. Contractor shall be
entitled to receive payment for: (1) if the Siemens Contract is terminated, the
Siemens Termination Payment; plus (2) the difference between (A) the Work Cost
(as defined below) and (B) the amounts Contractor has previously been paid under
the Agreement for EPC Payment Milestones, including any down payments made by
Owner (other than down payments made by Owner on account of the Siemens
Contract) (this difference in clause (2) being the “Kiewit Termination Charge”).
In no event shall Contractor be entitled to receive any amount for unabsorbed
overhead, contingency, risk or anticipatory profit. Contractor shall submit its
accounting of the Kiewit Termination Charge to Owner for verification and audit
within sixty (60) Days following the effective date of termination. If no Work
has been performed by Contractor at the time of termination, Contractor shall be
paid the sum of One Hundred U.S. Dollars (U.S.$100) for its undertaking to
perform. The Siemens Termination Payment and Kiewit Termination Payment shall be
Owner’s sole liability to Contractor in the event of a termination under this
Section 17.2.

A. The “Work Cost” shall mean the sum of (i) that part of the EPC Payment
Milestone portion of the Contract Price that has been properly invoiced by
Contractor under this Agreement for Work allocated to EPC Payment Milestones
completed in accordance herewith prior to termination (as such amounts may be
limited by the maximum cumulative payment amounts for which Contractor is able
to invoice to Owner in a given Month for the EPC Payment Milestones, as further
set forth in Schedule C-3) plus (ii) the Demobilization and Subcontract
Cancellation Cost. The “Demobilization and Subcontract Cancellation Cost” shall
mean the documented and reasonable costs (plus a profit of ***) incurred by
Contractor to demobilize from the Site plus actual cancellation charges incurred
by Contractor on any Subcontract terminated as a result of the terminated Work,
all of which Contractor shall use commercially reasonable efforts to minimize;
provided, however, notwithstanding the foregoing, the Demobilization and
Subcontract Cancellation Cost shall not exceed the Maximum Demobilization and
Subcontract Cancellation Cost set forth in Schedule C-3 as determined by the
Month in which the Agreement is terminated. For purposes of clarity, in the
event of a termination for convenience under Section 17.2 and with respect to
the invoices provided by Contractor pursuant to clause (i) above for EPC Payment
Milestones completed prior to termination,

 

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such invoices may include an invoice submitted by Contractor promptly after
termination which accounts for EPC Payment Milestones completed between the last
regularly submitted invoice and the date of termination.

17.3 Suspension of Work. Owner may, for any reason, at any time and from time to
time, by written Owner-directed or mutual Change Order, suspend the carrying out
the Work or any part thereof, whereupon Contractor shall suspend the carrying
out of such suspended Work for such time or times and in such manner as Owner
may require and shall take reasonable steps to minimize any costs associated
with such suspension; provided, however, with respect to any suspension of Work
being performed under the Siemens Contract, the Parties acknowledge that such
suspension of Work shall be subject to the conditions on suspension set forth in
Section 10.2.2 of the Siemens Contract and Contractor’s directives to, or
agreements with, Siemens with respect to suspension of any Work under the
Siemens Contract shall be subject to Owner’s written approval. During any
suspension, Contractor shall properly protect and secure such suspended Work in
accordance with GECP. Unless otherwise instructed by Owner, Contractor shall
during any such suspension maintain its staff and labor on or near the Site and
otherwise be ready to proceed expeditiously with the Work upon receipt of
Owner’s further instructions. Except where such suspension ordered by Owner is
the result of or due to the fault or negligence of Contractor or any
Subcontractor or Sub-subcontractor, Contractor shall be entitled to the
reasonable costs (including actual, but not unabsorbed, overhead, contingency,
escalation, and risk and a profit of ***) of such suspension, including
demobilization and remobilization costs, if necessary, along with appropriate
supporting documentation to evidence such costs, and a time extension to the Key
Milestone Schedule, Guaranteed Substantial Completion Date and Required Final
Completion Date, as applicable, if and to the extent permitted under
Section 6.8. Upon receipt of notice to resume suspended Work, Contractor shall
immediately resume performance of the Work to the extent required in the notice;
provided, however, with respect to resumption of suspended Work being performed
under the Siemens Contract, such resumption of Work shall be further subject to
the conditions and considerations set forth in Section 10.2.2 of the Siemens
Contract. In no event shall Contractor be entitled to any additional profits or
damages due to such suspension.

17.4 Suspension by Contractor. Notwithstanding anything to the contrary in this
Agreement, Contractor shall have the responsibility at all times to prosecute
the Work diligently and shall not suspend, stop or cease performance hereunder
or permit the prosecution of the Work to be delayed; provided, however, subject
to Owner’s right to withhold or offset payment to Contractor under this
Agreement, if Owner fails to pay undisputed amounts due and owing to Contractor,
and Owner has failed to cure such failure within fifteen (15) Days following
Contractor’s written notice to Owner to cure such failure, Contractor may
suspend performance of the Work until Contractor receives such undisputed
amounts.

17.5 Termination by Contractor. Contractor may terminate this Agreement if,
continuing at the time of such termination, Contractor has stopped the
performance of all Work under this Agreement pursuant to Section 17.4 for thirty
(30) Days, and after the expiration of such thirty (30) Day period, Contractor
gives Owner written notice specifying the nature of the default and its intent
to terminate the Agreement, and Owner fails to cure such default within fifteen
(15) Days after receipt of Contractor’s notice. In addition, if Owner has
suspended all Work pursuant to Section 17.3 and such suspension has lasted
beyond three hundred sixty five (365) Days, Contractor shall have the right,
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event of any such termination under this Section 17.5, Contractor shall have the
rights (and Owner shall make the payments) provided for in Section 17.2 in the
event of an Owner termination for convenience. Contractor’s sole rights to
terminate this Agreement are set forth in Sections 17.5 and 17.6.

17.6 Termination in the Event of Extended Force Majeure. If a Force Majeure
occurring after issuance of NTP causes Contractor to suspend performance of all
the Work for a period exceeding *** Days, either Party may, upon thirty
(30) Days prior written notice to the other Party stating its intentions,
terminate the Agreement. Termination of the Agreement in accordance with this
Section 17.6 shall cause the Parties to have the rights and obligations as if
such termination was initiated pursuant to Section 17.2; provided, however, and
notwithstanding anything to the contrary, Owner shall not be responsible for the
Siemens Termination Payment or the Kiewit Termination Charge in the event of a
termination in accordance with this Section 17.6, and Contractor’s sole remedy,
and Owner’s sole obligations, with respect to payment for such termination shall
be payment for the Work performed, up to the date of termination, in accordance
with Section 7.2.

ARTICLE 18

INDEMNITIES

18.1 General Indemnification. IN ADDITION TO ITS INDEMNIFICATION, DEFENSE AND
HOLD HARMLESS OBLIGATIONS CONTAINED ELSEWHERE IN THIS AGREEMENT, CONTRACTOR
SHALL FULLY INDEMNIFY, HOLD HARMLESS AND DEFEND OWNER GROUP FROM ANY AND ALL
DAMAGES, LOSSES, COSTS AND EXPENSES (INCLUDING ALL FINES AND PENALTIES AS WELL
AS ATTORNEYS’ FEES, CONSULTANT FEES AND LITIGATION EXPENSES) DIRECTLY OR
INDIRECTLY ARISING OUT OF OR RESULTING FROM OR RELATED TO ANY OF THE FOLLOWING:

A. ACTUAL OR ALLEGED FAILURE OF CONTRACTOR OR ITS SUBCONTRACTORS OR
SUB-SUBCONTRACTORS TO COMPLY WITH APPLICABLE LAW, APPLICABLE CODES AND STANDARDS
OR SAFETY PROCEDURES UNDER THIS AGREEMENT;

B. ACTUAL OR ASSERTED VIOLATION OR INFRINGEMENT OF ANY DOMESTIC OR FOREIGN
PATENTS, COPYRIGHTS OR TRADEMARKS OR OTHER INTELLECTUAL PROPERTY, OR ANY
IMPROPER USE OF CONFIDENTIAL INFORMATION OR OTHER PROPRIETARY RIGHTS THAT MAY BE
ATTRIBUTABLE TO CONTRACTOR OR ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR IN
CONNECTION WITH THE WORK;

C. SUBJECT TO OWNER’S INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTIONS 18.2B
AND 18.2C, ACTUAL OR ALLEGED CONTAMINATION, SPILL, RELEASE, DISCHARGE, POLLUTION
OR OTHERWISE OF THE LAND OR WATER ARISING OUT OF ACTS OR OMISSIONS OF
CONTRACTOR’S OR ANY SUBCONTRACTOR’S OR SUB-SUBCONTRACTOR’S USE, HANDLING OR
DISPOSAL OF HAZARDOUS MATERIALS DURING THE PERFORMANCE OF THE WORK AND ANY
ENVIRONMENTAL DAMAGE OF ANY OTHER NATURE TO THE EXTENT ARISING FROM THE ACTS OR
OMISSIONS OF CONTRACTOR OR ITS SUBCONTRACTORS OR SUB-SUBCONTRACTORS;

 

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D. SUBJECT TO OWNER’S LIABILITIES SET FORTH IN SECTION 4.5, CLAIMS BY ANY
GOVERNMENTAL INSTRUMENTALITY AS A RESULT OF A FAILURE BY CONTRACTOR OR ANY
SUBCONTRACTOR OR SUB-SUBCONTRACTOR TO PAY TAXES IN ACCORDANCE WITH ARTICLE 8; OR

E. PERSONAL INJURY TO OR DEATH OF ANY PERSON, OR DAMAGE TO OR DESTRUCTION OF
PROPERTY OF ANY PERSON (EXCLUDING THE WORK AND CONTRACTOR’S OR ANY
SUBCONTRACTOR’S OR SUB-SUBCONTRACTOR’S CONSTRUCTION EQUIPMENT) ARISING OUT OF OR
RELATING TO THE WORK OR THE FACILITY TO THE EXTENT CAUSED BY THE NEGLIGENCE,
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY MEMBER OF CONTRACTOR GROUP OR ANY
SUBCONTRACTOR OR SUB-SUBCONTRACTOR OR ANYONE DIRECTLY OR INDIRECTLY EMPLOYED BY
THEM OR ANYONE FOR WHOSE ACTS THEY MAY BE LIABLE; ***.

18.2 Owner Indemnification. IN ADDITION TO ITS INDEMNIFICATION, DEFENSE AND HOLD
HARMLESS OBLIGATIONS CONTAINED ELSEWHERE IN THIS AGREEMENT, OWNER SHALL FULLY
INDEMNIFY, HOLD HARMLESS AND DEFEND CONTRACTOR GROUP FROM ANY AND ALL DAMAGES,
LOSSES, COSTS AND EXPENSES (INCLUDING ALL FINES AND PENALTIES AS WELL AS
ATTORNEYS’ FEES, CONSULTANT FEES AND LITIGATION EXPENSES) DIRECTLY OR INDIRECTLY
ARISING OUT OF OR RESULTING FROM OR RELATED TO ANY OF THE FOLLOWING:

A. PERSONAL INJURY TO OR DEATH OF ANY PERSON, OR DAMAGE TO OR DESTRUCTION OF
PROPERTY OF ANY PERSON (EXCLUDING THE WORK AND CONTRACTOR’S OR ANY
SUBCONTRACTOR’S OR SUB-SUBCONTRACTOR’S CONSTRUCTION EQUIPMENT) ARISING OUT OF OR
RELATING TO THE WORK OR THE FACILITY TO THE EXTENT CAUSED BY THE NEGLIGENCE,
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF ANY MEMBER OF OWNER GROUP OR ANYONE
DIRECTLY OR INDIRECTLY EMPLOYED BY THEM OR ANYONE FOR WHOSE ACTS THEY MAY BE
LIABLE;

B. PRE-EXISTING HAZARDOUS MATERIALS AT THE SITE, EXCEPT TO THE EXTENT
CONTRACTOR, OR ANY OF ITS SUBCONTRACTORS OR SUB-SUBCONTRACTORS, KNEW OR
REASONABLY SHOULD HAVE KNOWN OF THE PRESENCE OF SUCH HAZARDOUS MATERIALS AND
THROUGH ITS NEGLIGENT ACTION EXACERBATED SUCH PRE-EXISTING HAZARDOUS MATERIALS;
OR

C. THIRD PARTY CLAIMS ARISING OUT OF ANY HAZARDOUS MATERIALS BROUGHT ONTO AND
MAINTAINED ON THE SITE BY CONTRACTOR OR ITS SUBCONTRACTORS OR SUB-SUBCONTRACTORS
IN ACCORDANCE WITH THIS AGREEMENT AND THEREAFTER RELEASED BY OWNER (OR ANY
PERSON FOR WHOM OWNER IS RESPONSIBLE OR WHO IS ACTING ON ITS BEHALF, OTHER THAN
CONTRACTOR OR ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR) IN VIOLATION OF APPLICABLE
LAW, APPLICABLE CODES AND STANDARDS OR OWNER’S ENVIRONMENTAL OR SAFETY
REQUIREMENTS. “THIRD PARTY” AS USED IN THIS SECTION 18.2C SHALL ANY PERSON OTHER
THAN A MEMBER OF OWNER GROUP OR CONTRACTOR GROUP.

18.3 Patent and Copyright Indemnification. IN THE EVENT THAT ANY SUIT, CLAIM,
TEMPORARY RESTRAINING ORDER OR PRELIMINARY INJUNCTION IS GRANTED IN CONNECTION
WITH

 

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SECTION 18.1B, CONTRACTOR SHALL, AT ITS OWN EXPENSE AND IN ADDITION TO ITS
OBLIGATION UNDER SECTION 18.1B, MAKE EVERY REASONABLE EFFORT, BY GIVING A
SATISFACTORY BOND OR OTHERWISE, TO SECURE THE SUSPENSION OF THE INJUNCTION OR
RESTRAINING ORDER. IF, IN ANY SUCH SUIT OR CLAIM, THE WORK, THE FACILITY, OR ANY
PART, COMBINATION OR PROCESS THEREOF, IS HELD TO CONSTITUTE AN INFRINGEMENT AND
ITS USE IS PRELIMINARILY OR PERMANENTLY ENJOINED, CONTRACTOR SHALL PROMPTLY MAKE
EVERY REASONABLE EFFORT TO SECURE FOR OWNER A LICENSE, AT NO COST TO OWNER,
AUTHORIZING CONTINUED USE OF THE INFRINGING WORK. IF CONTRACTOR IS UNABLE TO
SECURE SUCH A LICENSE WITHIN A REASONABLE TIME, CONTRACTOR SHALL, AT ITS OWN
EXPENSE AND WITHOUT IMPAIRING PERFORMANCE REQUIREMENTS, EITHER REPLACE THE
AFFECTED WORK, IN WHOLE OR PART, WITH NON-INFRINGING COMPONENTS OR PARTS OR
MODIFY THE SAME SO THAT THEY BECOME NON-INFRINGING.

18.4 Lien Indemnification. SHOULD ANY SUBCONTRACTOR OR SUB-SUBCONTRACTOR OR ANY
OTHER PERSON ACTING THROUGH OR UNDER CONTRACTOR OR ANY SUBCONTRACTOR OR
SUB-SUBCONTRACTOR FILE A LIEN, STOP NOTICE OR OTHER ENCUMBRANCE AGAINST ALL OR
ANY PORTION OF THE WORK, THE SITE OR THE FACILITY, CONTRACTOR SHALL, AT ITS SOLE
COST AND EXPENSE, REMOVE AND DISCHARGE, BY PAYMENT, BOND OR OTHERWISE, SUCH
LIEN, STOP NOTICE OR ENCUMBRANCE WITHIN FIFTEEN (15) DAYS OF THE FILING OF SUCH
LIEN, STOP NOTICE OR ENCUMBRANCE. IF CONTRACTOR FAILS TO REMOVE AND DISCHARGE
ANY SUCH LIEN, STOP NOTICE OR ENCUMBRANCE WITHIN SUCH FIFTEEN (15) DAY PERIOD,
THEN OWNER MAY, IN ITS SOLE DISCRETION AND IN ADDITION TO ANY OTHER RIGHTS THAT
IT HAS UNDER THIS AGREEMENT, AT LAW OR EQUITY, TAKE ANY ONE OR MORE OF THE
FOLLOWING ACTIONS:

A. REMOVE AND DISCHARGE SUCH LIEN, STOP NOTICE AND ENCUMBRANCE USING WHATEVER
MEANS THAT OWNER, IN ITS SOLE DISCRETION, DEEMS APPROPRIATE, INCLUDING THE
PAYMENT OF SETTLEMENT AMOUNTS THAT IT DETERMINES IN ITS SOLE DISCRETION AS BEING
NECESSARY TO DISCHARGE SUCH LIEN, STOP NOTICE OR ENCUMBRANCE. IN SUCH
CIRCUMSTANCE, CONTRACTOR SHALL BE LIABLE TO OWNER FOR ALL DAMAGES, COSTS, LOSSES
AND EXPENSES (INCLUDING ALL ATTORNEYS’ FEES, CONSULTANT FEES AND LITIGATION
EXPENSES, AND SETTLEMENT PAYMENTS) INCURRED BY OWNER ARISING OUT OF OR RELATING
TO SUCH REMOVAL AND DISCHARGE. ALL SUCH DAMAGES, COSTS, LOSSES AND EXPENSES
SHALL BE PAID BY CONTRACTOR NO LATER THAN THIRTY (30) DAYS AFTER RECEIPT OF EACH
INVOICE FROM OWNER;

B. SEEK AND OBTAIN AN ORDER GRANTING SPECIFIC PERFORMANCE FROM A COURT OF
COMPETENT JURISDICTION, REQUIRING THAT CONTRACTOR IMMEDIATELY DISCHARGE AND
REMOVE, BY BOND, PAYMENT OR OTHERWISE, SUCH LIEN, STOP NOTICE OR ENCUMBRANCE.
THE PARTIES EXPRESSLY AGREE THAT OWNER SHALL BE ENTITLED TO SUCH SPECIFIC
PERFORMANCE AND THAT CONTRACTOR SHALL BE LIABLE TO OWNER FOR ALL DAMAGES, COSTS,
LOSSES AND EXPENSES (INCLUDING ALL ATTORNEYS’ FEES, CONSULTANT FEES AND
LITIGATION EXPENSES) INCURRED BY OWNER ARISING OUT OF OR RELATING TO SUCH
SPECIFIC PERFORMANCE ACTION. CONTRACTOR AGREES THAT THE FAILURE TO DISCHARGE AND
REMOVE ANY SUCH LIEN, STOP NOTICE OR ENCUMBRANCE WILL GIVE RISE TO IRREPARABLE
INJURY TO OWNER AND OWNER’S AFFILIATES, AND FURTHER, THAT OWNER AND SUCH OWNER
AFFILIATES WILL NOT BE ADEQUATELY COMPENSATED BY DAMAGES;

 

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C. CONDUCT THE DEFENSE OF ANY ACTION IN RESPECT OF (AND ANY COUNTERCLAIMS
RELATED TO) SUCH LIENS, STOP NOTICES OR ENCUMBRANCES AS SET FORTH IN
SECTION 18.5, WITHOUT REGARD TO CONTRACTOR’S RIGHTS UNDER SUCH SECTION; OR

D. WITHHOLD ANY AMOUNTS OTHERWISE DUE AND OWING TO CONTRACTOR UNDER THIS
AGREEMENT EQUAL TO THE AMOUNT OF THE LIEN, STOP NOTICE OR ENCUMBRANCE PLUS ALL
DAMAGES, COSTS, LOSSES AND EXPENSES ARISING OUT OF SUCH LIEN OR ENCUMBRANCE,
INCLUDING REASONABLE ATTORNEYS’ FEES, CONSULTANT FEES AND EXPENSES.

18.5 Legal Defense. NOT LATER THAN FIFTEEN (15) DAYS AFTER RECEIPT OF WRITTEN
NOTICE FROM THE INDEMNIFIED PARTY TO THE INDEMNIFYING PARTY OF ANY CLAIMS,
DEMANDS, ACTIONS OR CAUSES OF ACTION ASSERTED AGAINST SUCH INDEMNIFIED PARTY FOR
WHICH THE INDEMNIFYING PARTY HAS INDEMNIFICATION, DEFENSE AND HOLD HARMLESS
OBLIGATIONS UNDER THIS AGREEMENT, WHETHER SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION IS ASSERTED IN A LEGAL, JUDICIAL, ARBITRAL OR ADMINISTRATIVE PROCEEDING
OR ACTION OR BY NOTICE WITHOUT INSTITUTION OF SUCH LEGAL, JUDICIAL, ARBITRAL OR
ADMINISTRATIVE PROCEEDING OR ACTION, THE INDEMNIFYING PARTY SHALL AFFIRM IN
WRITING BY NOTICE TO SUCH INDEMNIFIED PARTY THAT INDEMNIFYING PARTY WILL
INDEMNIFY, DEFEND AND HOLD HARMLESS SUCH INDEMNIFIED PARTY AND SHALL, AT THE
INDEMNIFYING PARTY’S OWN COST AND EXPENSE, ASSUME ON BEHALF OF THE INDEMNIFIED
PARTY AND CONDUCT WITH DUE DILIGENCE AND IN GOOD FAITH THE DEFENSE THEREOF WITH
COUNSEL SELECTED BY THE INDEMNIFYING PARTY AND REASONABLY SATISFACTORY TO SUCH
INDEMNIFIED PARTY; PROVIDED, HOWEVER, THAT, WITHOUT RELIEVING THE INDEMNIFYING
PARTY OF ITS OBLIGATIONS HEREUNDER, THE INDEMNIFIED PARTY SHALL HAVE THE RIGHT
TO BE REPRESENTED THEREIN BY ADVISORY COUNSEL OF ITS OWN SELECTION, AND AT ITS
OWN EXPENSE; PROVIDED FURTHER THAT IF THE DEFENDANTS IN ANY SUCH ACTION OR
PROCEEDING INCLUDE THE INDEMNIFYING PARTY AND AN INDEMNIFIED PARTY AND THE
INDEMNIFIED PARTY SHALL HAVE REASONABLY CONCLUDED THAT THERE MAY BE LEGAL
DEFENSES AVAILABLE TO IT WHICH ARE DIFFERENT FROM OR ADDITIONAL TO, OR
INCONSISTENT WITH, THOSE AVAILABLE TO THE INDEMNIFYING PARTY, SUCH INDEMNIFIED
PARTY SHALL HAVE THE RIGHT TO SELECT SEPARATE COUNSEL TO PARTICIPATE IN THE
DEFENSE OF SUCH ACTION OR PROCEEDING ON ITS OWN BEHALF AT THE REASONABLE EXPENSE
OF THE INDEMNIFYING PARTY. IN THE EVENT OF THE FAILURE OF THE INDEMNIFYING PARTY
TO PERFORM FULLY IN ACCORDANCE WITH THE DEFENSE OBLIGATIONS UNDER THIS
SECTION 18.5, SUCH INDEMNIFIED PARTY MAY, AT ITS OPTION, AND WITHOUT RELIEVING
THE INDEMNIFYING PARTY OF ITS OBLIGATIONS HEREUNDER, SO PERFORM, BUT ALL
DAMAGES, COSTS AND EXPENSES (INCLUDING ALL ATTORNEYS’ FEES, CONSULTANT FEES AND
LITIGATION EXPENSES, SETTLEMENT PAYMENTS AND JUDGMENTS) SO INCURRED BY SUCH
INDEMNIFIED PARTY IN THAT EVENT SHALL BE REIMBURSED BY THE INDEMNIFYING PARTY TO
SUCH INDEMNIFIED PARTY, TOGETHER WITH INTEREST ON SAME FROM THE DATE ANY SUCH
COST AND EXPENSE WAS PAID BY SUCH INDEMNIFIED PARTY UNTIL REIMBURSED BY THE
INDEMNIFYING PARTY AT THE INTEREST RATE SET FORTH IN THIS AGREEMENT.

18.6 Enforceability.

A. THE INDEMNITY, DEFENSE AND HOLD HARMLESS OBLIGATIONS FOR PERSONAL INJURY OR
DEATH OR PROPERTY DAMAGE UNDER SECTIONS 18.1E AND 18.2A SHALL APPLY REGARDLESS
OF WHETHER THE OWNER GROUP WAS CONCURRENTLY

 

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NEGLIGENT (WHETHER ACTIVELY OR PASSIVELY), IT BEING AGREED BY THE PARTIES THAT
IN THIS EVENT, THE PARTIES’ RESPECTIVE LIABILITY OR RESPONSIBILITY FOR SUCH
DAMAGES, LOSSES, COSTS AND EXPENSES UNDER THIS ARTICLE 18 SHALL BE DETERMINED IN
ACCORDANCE WITH PRINCIPLES OF COMPARATIVE NEGLIGENCE.

B. IN THE EVENT THAT ANY INDEMNITY PROVISIONS IN THIS AGREEMENT ARE CONTRARY TO
THE LAW GOVERNING THIS AGREEMENT, THEN THE INDEMNITY OBLIGATIONS APPLICABLE
HEREUNDER SHALL BE APPLIED TO THE MAXIMUM EXTENT ALLOWED BY APPLICABLE LAW. EACH
PARTY ACKNOWLEDGES SPECIFIC PAYMENT OF TEN AND NO/100 U.S. DOLLARS (U.S. $10.00)
AS LEGAL CONSIDERATION FOR THE INDEMNITY OBLIGATIONS AS MAY BE PROVIDED IN THIS
AGREEMENT.

ARTICLE 19

DISPUTE RESOLUTION

19.1 Negotiation - Parties’ Representatives. The Parties will attempt in good
faith to resolve any dispute, controversy or claim (herein referred to as
“Dispute”) arising out of or relating to the Agreement (whether based on
contract, tort, statute, regulation or otherwise, and including the
construction, validity, interpretation, termination, enforceability or breach of
the Agreement) promptly by negotiations by the Contractor Representative and
Owner Representative. If a Dispute should arise, the Contractor Representative
and Owner Representative will meet at least once and will attempt to resolve the
Dispute. Either Representative may request, by written notice to the other, to
meet within seven (7) Days at a mutually agreed time and place.

19.2 Negotiation - Senior Executives. If the Dispute has not been resolved
within fifteen (15) Days after receipt of the written notice in Section 19.1 (or
such other period of time as the Parties may mutually agree upon in writing),
either Party may refer the Dispute, by giving written notice to the other Party,
to the senior executives of the Parties who shall have authority to settle the
Dispute. Thereupon, the Parties shall promptly prepare and exchange memoranda
stating the issues in the Dispute and their positions, summarizing the
negotiations which have taken place and attaching relevant documents. The senior
executives will meet for negotiations within fifteen (15) Days after the Party’s
receipt of such written notice, at a mutually agreed time and place.

19.3 Litigation. In the event that the Dispute is not resolved by negotiations
by senior executives within forty-five (45) Days after receipt of the written
notice for senior executive meetings pursuant to Section 19.2 (or such other
time agreed upon by the Parties in writing), then the Parties agree that such
Dispute shall be decided by litigation pursuant to this Section 19.3. Litigation
of any Dispute shall be brought exclusively in a federal or state court located
in New York County in the State of New York. Each Party hereby consents to
personal jurisdiction in any legal action, suit, or proceeding brought in any
federal or state court within New York County in the State of New York having
subject matter jurisdiction and irrevocably waives, to the fullest extent
permitted by Applicable Law and the laws of the State of New York, any claim or
any objection it may now or hereafter have, that venue or personal jurisdiction
is not proper with respect to any such legal action, suit, or proceeding brought
in such a court in the State of New York, including any claim that such legal
action, suit, or proceeding brought in such court has been brought in an
inconvenient forum. Each Party further consents to the service of process out of
any of the aforementioned courts in any such action or proceeding by the mailing
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registered or certified mail, postage prepaid, to such Party at its address
specified herein for the giving of notices, or by such other notice given in
accordance with the rules and procedures of such courts.

19.4 Continuation of Work During Dispute. Notwithstanding any Dispute, it shall
be the responsibility of Contractor to continue to prosecute all of the Work
diligently and in a good and workmanlike manner in conformity with this
Agreement. Except to the extent provided in Sections 17.4 or 17.5, Contractor
shall have no right to cease performance hereunder or to permit the prosecution
of the Work to be delayed. Owner shall, subject to its right to withhold or
offset amounts pursuant to this Agreement, continue to pay Contractor undisputed
amounts in accordance with this Agreement; provided, however, in no event shall
the occurrence of any negotiation or litigation prevent or affect Owner from
exercising its rights under this Agreement, at law or in equity, including
Owner’s right to terminate pursuant to Article 17.

ARTICLE 20

CONFIDENTIALITY

20.1 Contractor’s Obligations. Contractor hereby covenants and warrants that
Contractor and its employees, officers, directors and agents shall not (without
in each instance obtaining Owner’s prior written consent) disclose, make
commercial or other use of, or give or sell to any Person any of the following
information: (i) any Work Product other than to Subcontractors or
Sub-subcontractors as necessary to perform the Work or (ii) any other
information relating to the business, products, services, research or
development, clients or customers of Owner or any Owner Affiliate, or relating
to similar information of a third party who has entrusted such information to
Owner or any Owner Affiliate (hereinafter individually or collectively, “Owner’s
Confidential Information”). Prior to disclosing any information in (i) of this
Section 20.1 to any Subcontractor or Sub-subcontractor necessary to perform the
Work, Contractor shall bind such Subcontractor or Sub-subcontractor to
confidentiality obligations conforming to those contained in this Article 20.
Nothing in this Section 20.1 or this Agreement shall in any way prohibit
Contractor or any of its Subcontractors or Sub-subcontractors from making
commercial or other use of, selling, or disclosing any of their respective
Contractor’s Intellectual Property or Third Party Proprietary Work Product.

20.2 Owner’s Obligations. Owner hereby covenants and warrants that Owner and its
employees and agents shall not (without in each instance obtaining Contractor’s
prior written consent) disclose or sell to any Person any of Contractor’s
Intellectual Property, Third Party Proprietary Work Product, technical or
pricing methodologies, pricing information, techniques or other information of
Contractor relating to the business, products, services, research or development
of Contractor which is conspicuously marked and identified in writing as
confidential by Contractor (hereinafter individually or collectively,
“Contractor’s Confidential Information”). The Parties agree that Owner may
disclose Contractor’s Confidential Information to its Affiliates, attorneys,
consultants, underwriters, a bona fide prospective purchaser of all or a portion
of Owner’s or any of its Affiliates’ assets or ownership interests, a bona fide
prospective assignee of all or a portion of Owner’s interest in this Agreement,
prospective or actual Lenders and their representatives, rating agencies or any
other party in relation to project financing for the Facility, any proposed or
actual customers of the Facility (including PG&E), any Persons performing any
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expansions or modifications to the Facility, and, in the event of a termination
of Contractor pursuant to Article 17, any substitute contractor engaged by Owner
to complete the Work, provided that Owner binds such Persons (other than rating
agencies) to the confidentiality obligations conforming to this Article 20.

20.3 Definitions. The term “Confidential Information” shall mean one or both of
Contractor’s Confidential Information and Owner’s Confidential Information, as
the context requires. The Party having the confidentiality obligations with
respect to such Confidential Information shall be referred to as the “Receiving
Party,” and the Party to whom such confidentiality obligations are owed shall be
referred to as the “Disclosing Party.”

20.4 Exceptions. Notwithstanding Sections 20.1 and 20.2, Confidential
Information shall not include: (i) information which at the time of disclosure
or acquisition is in the public domain, or which after disclosure or acquisition
becomes part of the public domain without violation of this Article 20;
(ii) information which at the time of disclosure or acquisition was already in
the possession of the Receiving Party or its employees or agents and was not
previously acquired from the Disclosing Party or any of its employees or agents
directly or indirectly, other than directly or indirectly disclosed or acquired
through the MOU, or any other agreements between the Parties related to the
Facility; (iii) information which the Receiving Party can show was acquired by
such entity after the time of disclosure or acquisition hereunder from a third
party without any confidentiality commitment, if, to the best of Receiving
Party’s or its employees’ or agent’s knowledge, such third party did not acquire
it, directly or indirectly, from the Disclosing Party or any of its employees or
agents; (iv) information independently developed by the Receiving Party without
benefit of the Confidential Information, but specifically excluding the Work
Product; and (v) information which is required to be disclosed by Applicable Law
(including under any state or federal securities laws) or in connection with
securing any Permits; provided, however, that prior to such disclosure, the
Receiving Party gives reasonable notice to the Disclosing Party of the
information required to be disclosed.

20.5 Equitable Relief. The Parties acknowledge that in the event of a breach of
any of the terms contained in this Article 20, the Disclosing Party would suffer
irreparable harm for which remedies at law, including damages, would be
inadequate, and that the Disclosing Party shall be entitled to seek equitable
relief therefor by injunction, in addition to any and all rights and remedies
available to it at law and in equity, without the requirement of posting a bond.

20.6 Term. The confidentiality obligations of this Article 20 shall survive the
expiration or termination of this Agreement for a period of *** following the
expiration or earlier termination of this Agreement.

20.7 Siemens Confidential Information. Notwithstanding anything to the contrary
in this Article 20, the Parties agree to adhere to the confidentiality
obligations set forth in Attachment BB with respect to (A) (i) the Siemens
Contract and (ii) any information conspicuously marked and identified in writing
as confidential by Siemens, as further described in Attachment BB (such
information identified in accordance with clause (ii) being the “Siemens
Confidential Information”) and (B) Owner’s Confidential Information disclosed to
Siemens.

 

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ARTICLE 21

LIMITATION OF LIABILITY

21.1 Contractor Aggregate Liability. ***

21.2 Limitation on Contractor’s Liability for Liquidated Damages.

A. Substantial Completion Delay Liquidated Damages. Subject to Section 21.2C,
Contractor’s maximum liability to Owner for Substantial Completion Delay
Liquidated Damages is ***.

B. Performance Liquidated Damages. Subject to Section 21.2C, Contractor’s
maximum liability to Owner for Performance Liquidated Damages is ***.

C. Exceptions to Limitations of Liability Under Section 21.2. Sections 21.2A and
21.2B shall not be construed to limit Contractor’s other obligations or
liabilities under this Agreement (including (i) its obligations to complete the
Work for the compensation provided under this Agreement, (ii) its obligations to
achieve Substantial Completion and Final Completion and (iii) its obligations
with respect to Minimum Acceptance Criteria and Warranties).

21.3 Liquidated Damages In General.

A. Liquidated Damages Not Penalty. It is expressly agreed that Liquidated
Damages payable under this Agreement do not constitute a penalty and that the
Parties, having negotiated in good faith for such specific Liquidated Damages
and having agreed that the amount of such Liquidated Damages is reasonable in
light of the anticipated harm caused by the breach related thereto and the
difficulties of proof of loss and inconvenience or nonfeasibility of obtaining
any adequate remedy, are estopped from contesting the validity or enforceability
of the per Day rate of the Substantial Completion Delay Liquidated Damages and
the per unit rate for the Performance Liquidated Damages on the basis that such
per Day rate or per unit rate constitutes a penalty. In the event Contractor,
Kiewit Construction Company, or anyone on their behalf, successfully challenges
the enforceability of the per day rate of any Substantial Completion Delay
Liquidated Damages or the per unit rate of any Performance Liquidated Damages on
the basis of being a penalty, Contractor specifically agrees to pay Owner all
actual damages incurred by Owner in connection with such breach, plus reasonable
costs incurred by Owner in proving the same, without regard to any limitations
whatsoever set forth in the Agreement other than (with respect to a challenge to
the Substantial Completion Delay Liquidated Damages) the cap on Substantial
Completion Delay Liquidated Damages specified in Section 21.2A or (with respect
to a challenge to the Performance Liquidated Damages) the cap on Performance
Liquidated Damages specified in Section 21.2B; provided that the reimbursement
of reasonable costs incurred by Owner in proving its actual damages (as set
forth above) shall not be included within the foregoing caps.

B. Liquidated Damages as Exclusive Damages. Payment of any Liquidated Damages
with respect to any Work shall be in addition to, and not in lieu of,
Contractor’s other obligations under this Agreement and shall in no way affect
Owner’s right to

 

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terminate this Agreement under Article 17 or receive other Liquidated Damages or
remedies contemplated in this Agreement for any other aspect of Contractor’s
obligations hereunder. Notwithstanding the foregoing and without limitation of
Owner’s rights under Sections 17.1 or 21.3A:

1. Substantial Completion Delay Liquidated Damages shall be the sole damages
owed by Contractor for delay in achieving Substantial Completion as set forth in
Section 14.1; and

2. Performance Liquidated Damages shall be the sole damages owed by Contractor
for failure of the Work to achieve any of the Performance Guarantees.

21.4 Consequential Damages. ***

ARTICLE 22

MISCELLANEOUS PROVISIONS

22.1 Entire Agreement. This Agreement, including the Attachments and Schedules
attached to and incorporated into this Agreement, contains the entire
understanding of the Parties with respect to the subject matter hereof and
incorporates any and all prior agreements and commitments with respect thereto.
There are no other oral understandings, terms or conditions, and neither Party
has relied upon any representation, express or implied, not contained in this
Agreement. General or special conditions included in any of Contractor’s price
lists, invoices, tickets, receipts or other such documents presented to Owner
shall have no applicability to Owner with respect to this Agreement. Without
limitation, this Agreement supersedes in its entirety the MOU (including the
term sheet attached thereto by subsequent amendment) and any other agreements
between the Parties related to the Facility. All Work performed (i) under the
MOU and any other agreements between the Parties related to the Facility and
(ii) by Siemens under the Siemens Contract prior to assignment to Contractor
pursuant to Section 22.8 shall be governed by the terms and conditions set forth
in this Agreement, and the payments made under the MOU and any other agreements
between the Parties related to the Facility and by Owner under the Siemens
Contract shall be deemed to have been made under this Agreement and shall be
credited towards the payment of the Contract Price herein.

22.2 Amendments. Other than Owner-directed Change Orders issued by Owner to
Contractor pursuant to Section 6.1C or Section 6.2D, no change, amendment or
modification of this Agreement shall be valid or binding upon the Parties hereto
unless such change, amendment or modification is in writing and duly executed by
both Parties hereto.

22.3 Joint Effort. Preparation of this Agreement has been a joint effort of the
Parties and the resulting document shall not be construed more severely against
one of the Parties than against the other.

22.4 Captions. The captions contained in this Agreement are for convenience and
reference only and in no way define, describe, extend or limit the scope of
intent of this Agreement or the intent of any provision contained herein.

 

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22.5 Notice. Any notice, demand, offer, or other written instrument required or
permitted to be given pursuant to this Agreement shall be in writing (in
English) signed by a duly authorized representative of the Party giving such
notice and shall reference the Agreement and shall be sent by: (i) registered or
certified mail; (ii) recognized express courier; or (iii) facsimile (followed by
registered mail), to the other Party at the address set forth below and shall be
effective upon delivery:

 

A.

  

If delivered to Owner:

  

Mirant Marsh Landing, LLC

c/o Mirant Corporation

1155 Perimeter Center West

Atlanta, Georgia 30338

Attention: Mike Ammer

Phone: (678) 579-5103

Email: michael.ammer@mirant.com

  

with a copy to:

  

Mirant Corporation

1155 Perimeter Center West

Atlanta, Georgia 30338

Facsimile: 678-579-5589

Attention: Steven Nickerson

B.

  

If delivered to Contractor:

  

Kiewit Power Constructors Co.

9401 Renner Blvd.

Lenexa, Kansas 66219

Facsimile: 913-928-7214

Attention: Kevin Needham

  

with a copy to:

  

Kiewit Power Constructors Co.

9401 Renner Blvd.

Lenexa, Kansas 66219

Facsimile: 913-928-7895

Attention: Robert Osborn

Each Party shall have the right to change the place to which notice shall be
sent or delivered by sending a similar notice to the other Party in like manner.

22.6 Severability. The invalidity of one or more phrases, sentences, clauses,
Sections or Articles contained in this Agreement shall not affect the validity
of the remaining portions of

 

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this Agreement so long as the material purposes of this Agreement can be
determined and effectuated.

22.7 Assignment of the Agreement. This Agreement may be assigned to other
Persons only upon the prior written consent of the non-assigning Party hereto,
except Owner may assign this Agreement, in whole or part and without
Contractor’s consent, to Mirant Corporation, Affiliates, any co-venturers, any
Person jointly controlled by Owner and any co-venturers or any purchaser of the
Facility or the Work; provided that, in the event of such an assignment by
Owner, either (i) the assignee shall provide a parent guarantee, otherwise in
compliance with the requirements set forth in Section 10.5, from a Person which,
at that time, has an equal or better credit rating than Mirant Corporation or
(ii) Mirant Corporation’s parent guarantee shall continue in effect as set forth
in Section 10.5 notwithstanding such assignment, and the choice of either (i) or
(ii) shall be at Owner’s sole discretion. Furthermore, Owner may assign, pledge
and/or grant a security interest in this Agreement to any Lender without
Contractor’s consent. When duly assigned in accordance with the foregoing, this
Agreement shall be binding upon and shall inure to the benefit of the assignee;
provided that any assignment by Contractor pursuant to this Section 22.7 shall
not relieve Contractor of any of its obligations or liabilities under this
Agreement. Any assignment not in accordance with this Section 22.7 shall be void
and without force or effect, and any attempt to assign this Agreement in
violation of this provision shall grant the non-assigning Party the right, but
not the obligation, to terminate this Agreement at its option for Default.

22.8 Assignment of the Siemens Contract. Contractor acknowledges that one of
Owner’s primary considerations in entering into this Agreement with Contractor
is Contractor’s willingness to be fully responsible for, and assume all
liabilities arising out of, the Siemens Contract and the work performed by
Siemens thereunder. As such, on the Effective Date and concurrently with the
execution of this Agreement, Contractor shall take assignment of the Siemens
Contract (including the Siemens Corporation parent guarantee) from Owner and
assume all responsibilities, obligations and liabilities thereto, including
being bound by all releases, limitations of liability, indemnities and other
protections afforded to Siemens under the Siemens Contract. Accordingly, Owner
hereby assigns and transfers to Contractor all of Owner’s rights, title and
interest in and to, and all obligations, responsibilities, rights and
liabilities related to, the Siemens Contract, and Contractor hereby agrees to
accept and assume, and does hereby accept and assume, the assignment and
transfer to Contractor of the Siemens Contract. The Siemens Equipment shall be
deemed to be Equipment provided by Contractor under this Agreement, and
Contractor shall assume full responsibility and liability to Owner for such
Siemens Equipment and the acts and omissions of Siemens (including with respect
to any Minimum Acceptance Criteria, Performance Guarantees or Warranty
obligations) without any exceptions whatsoever. Without limiting the foregoing
in any way, after taking assignment of the Siemens Contract, Contractor shall
not enter into any change orders or amendments, or otherwise waive or modify any
rights of Contractor or obligations of Siemens, under the Siemens Contract
without Owner’s prior written approval (such approval not to be unreasonably
withheld). In addition, under no circumstances shall Contractor terminate, or
assign to another Person, all or any portion of the Siemens Contract or the work
to be performed thereunder without Owner’s prior written approval, and any such
termination or assignment without Owner’s prior written approval shall be
considered a Default under this Agreement.

 

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A. Contractor Parent Guarantee for Siemens. Upon assignment of the Siemens
Contract to Contractor in accordance with Section 22.8, Contractor will provide
a parent guarantee from Kiewit Construction Company, in a form acceptable to
Contractor and Siemens, in favor of Siemens guaranteeing the payment of the
Siemens Termination Payment in accordance with the Siemens Contract.

22.9 No Waiver. Any failure of either Party to enforce any of the provisions of
this Agreement or to require compliance with any of its terms at any time during
the term of this Agreement shall in no way affect the validity of this
Agreement, or any part hereof, and shall not be deemed a waiver of the right of
such Party thereafter to enforce any and each such provisions.

22.10 Governing Law. THIS AGREEMENT, INCLUDING THE INTERPRETATION AND
ENFORCEMENT HEREOF, AND THE RESOLUTION OF ALL DISPUTES BETWEEN THE PARTIES
ARISING OUT OF OR RESULTING FROM THIS AGREEMENT, SHALL BE GOVERNED BY,
INTERPRETED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
EXCEPT FOR (I) ANY CHOICE OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE
STATE OF NEW YORK OR ANY OTHER JURISDICTION) OTHER THAN SECTION 5-1401 OF THE
NEW YORK GENERAL OBLIGATIONS LAW OR (II) LIEN AND STOP NOTICE RIGHTS, WHICH
SHALL BE GOVERNED UNDER THE LAWS OF THE STATE OF CALIFORNIA. The United Nations
Convention on Contracts for the International Sale of Goods shall not apply to
this Agreement and shall be disclaimed in and excluded from any Subcontracts
entered into by Contractor in connection with the Work or the Facility.

22.11 Foreign Corrupt Practice Act. With respect to the performance of the Work,
Owner shall, Contractor shall, and Contractor shall cause each of its
Subcontractors and Sub-subcontractors, and the agents and employees of such
Subcontractors and Sub-subcontractors, to comply with all provisions of the
Foreign Corrupt Practices Act of the United States (15 U.S.C. § 78dd-1 and 2)
and shall not to take any action that could result in Contractor, Owner or any
of their Affiliates becoming subject to any action, penalty or loss of benefits
under such Act.

22.12 Successors and Assigns. This Agreement shall be binding upon the Parties
hereto, their successors and permitted assigns.

22.13 Attachments and Schedules. All Attachments and Schedules shall be
incorporated into this Agreement by such reference and shall be deemed to be an
integral part of this Agreement.

22.14 Obligations. Nothing contained in this Agreement shall be construed as
constituting a joint venture or partnership between Contractor and Owner.

22.15 Further Assurances. Contractor and Owner agree to provide such
information, execute and deliver any such instruments and documents and to take
such other actions as may be necessary or reasonably requested by the other
Party that are not inconsistent with the provisions of this Agreement and that
do not involve the assumptions of obligations greater than those provided for in
this Agreement, in order to give full effect to this Agreement and to carry out
the intent of this Agreement.

22.16 Priority. The documents that form this Agreement are listed below in order
of priority, with the document having the highest priority listed first and the
one with the lowest

 

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priority listed last. Subject to Section 1.1 under the definition of Applicable
Codes and Standards regarding conflicts or inconsistencies between any
Applicable Codes and Standards, in the event of any conflict or inconsistency
between a provision in one document and a provision in another document, the
document with the higher priority shall control. In the event of a conflict or
inconsistency between provisions contained within the same document, then the
provision that requires the highest standard of performance on the part of
Contractor shall control. This Agreement is composed of the following documents,
which are listed in priority:

A. Change Orders or written amendments to this Agreement;

B. this Agreement; and

C. Attachments and Schedules to this Agreement.

22.17 Restrictions on Public Announcements. Without the prior written consent of
Owner, neither Contractor nor its Subcontractors or Sub-subcontractors shall
publicly refer to the Work or any part of the Facility in any manner, including
the issuance of a press release, advertisement, publication of photographs,
publicity material, prospectus, financial document or similar material, the
creation of any business development materials, proposals, reference materials
or similar materials, or the participation in a media interview that mentions or
refers to the Work or any part of the Facility. Under no circumstance shall
Contractor permit access to the Site by third parties who are not involved in
the performance of the Work without prior written consent of Owner.

22.18 Language. This Agreement and all notices, communications and submittals
between the Parties pursuant to this Agreement shall be in the English language,
unless otherwise directed by Owner.

22.19 Counterparts. This Agreement may be signed in any number of counterparts
and each counterpart shall represent a fully executed original as if signed by
each of the Parties. Facsimile signatures shall be deemed as effective as
original signatures.

22.20 Owner’s Lender. In addition to other assurances provided in this
Agreement, Contractor acknowledges that Owner intends to obtain project
financing associated with the Facility and Contractor agrees to cooperate with
Owner and Lender in connection with such project financing, including entering
into direct agreements with Lender, as required by Lender, covering matters that
are customary in project financings of this type such as Lender assignment or
security rights with respect to this Agreement, direct notices to Lender,
step-in/step-out rights, access by Lender’s representative and other matters
applicable to such project financing. Contractor acknowledges and agrees that
Owner’s execution of this Agreement (including issuance of any LNTP or NTP) is
contingent upon obtaining such non-recourse project financing and agrees further
that in the event Owner does not obtain such project financing, Owner shall not
be liable to Contractor by reason of any terms and conditions contained in or
connected with this Agreement. In addition, Contractor acknowledges that the
ability of Owner to agree to amendments to, or Change Orders under, this
Agreement may be restricted by the terms of the project financing for the
Facility.

 

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A. For purposes of clarity, Contractor shall not be responsible for payments to
Owner’s engineer or Lender’s independent engineer utilized for the Facility.

22.21 Survival. Article 8, Article 10, Article 11, Article 13, Article 15,
Article 16, Article 17, Article 18, Article 19, Article 20 and Article 21, and
Sections 3.6, 3.8, 3.13, 3.17, 7.4, 9.1, 9.2, 12.10, 22.8, 22.10, 22.11, 22.17
and this Section 22.21 shall survive termination or expiration of this
Agreement, in addition to any other provisions which by their nature should, or
by their express terms do, survive or extend beyond the termination or
expiration of this Agreement.

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized representatives as of the Effective Date.

 

Owner:

MIRANT MARSH LANDING, LLC

By:

 

/s/ John Chillemi

Name:

 

John Chillemi

Title:

 

President

Contractor:

KIEWIT POWER CONSTRUCTORS CO.

By:

 

/s/ Thomas S. Shelby

Name:

 

Thomas S. Shelby

Title:

 

Executive Vice President

 

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Execution Version

ATTACHMENT A

SCOPE OF WORK AND DESIGN BASIS

--------------------------------------------------------------------------------

SCHEDULE A-1

SCOPE OF WORK

***

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Execution Version

SCHEDULE A-2

DESIGN, ENGINEERING AND CODES

***

--------------------------------------------------------------------------------

Execution Version

SCHEDULE A-3

ENGINEERED EQUIPMENT LIST

***

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Execution Version

SCHEDULE A-4

UTILITY INTERFACE SCHEDULE

***

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Execution Version

SCHEDULE A-5

ENGINEERING DRAWINGS

***

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Execution Version

SCHEDULE A-6

GRADING AND DRAINAGE PLAN

***

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Execution Version

ATTACHMENT B

CONTRACTOR DELIVERABLES

In addition to the requirements under the Agreement, Contractor shall be
responsible for providing Owner with all of the Drawings, Specifications and
other documents required under this Attachment B and any and all other Drawings,
Specifications and other documents not listed below but required under the
Agreement or for the performance of the Work:

 

1.

Documentation Preparation, Review and Distribution.

Contractor and its Subcontractors and Sub-subcontractors (including vendors)
shall prepare all Drawings, Specifications and other documents as and when
necessary for the timely performance of the Work, and in addition, Contractor
shall distribute to Owner the Drawings, Specifications and other documents
listed in Attachment B, Schedules B-1 and B-2 within the times required under
this Attachment B, including Schedule B-1.

In addition to other requirements of the Agreement, Schedule B-1 provides
details of Drawings, Specifications and other documents Owner requires for its
review and approval or disapproval as provided in Section 3.3C of the Agreement
(labeled in Schedule B-1 as “For Review”), or for its information only (labeled
in Schedule B-1 for “For Information”). Within thirty (30) Days after issuance
of NTP, Contractor shall prepare and submit to Owner for Owner’s written
approval a matrix describing how and to whom the Drawings, Specifications and
other documents will be distributed (hereinafter “Document Distribution
Matrix”). All Drawings, Specifications and other documents identified in this
Attachment B shall be distributed to Owner in accordance with the agreed
Document Distribution Matrix.

Contractor shall issue an electronic notification that a Drawing, Specification
or other document is available ‘For Review’ or ‘For Information’ to all parties
identified on the agreed Document Distribution Matrix. In addition, except as
otherwise provided in the Agreement, Contractor shall issue to Owner and all
other parties identified in the Document Distribution Matrix an electronic
submittal (in accordance with Section 6 herein) of all Drawings, Specifications
and other documents, together with a transmittal letter addressed as agreed upon
by Owner. The transmittal letter for the attached document shall state the
action to be taken (‘For Review’ or ‘For Information’).

Schedule B-2 provides a representative sample of the minimum requirements for
documentation and descriptions of the contents of such documents to be provided
by Subcontractors or Sub-subcontractors supplying Equipment (such Equipment
supply Subcontractors and Sub-subcontractors collectively being identified as
“Vendors”). Contractor shall distribute to Owner the Vendor documentation
(including Drawings and Specifications) required by Schedule B-2 in accordance
with the times as required under this Attachment B, including Schedule B-1. The
Vendor documentation in Schedule B-2 is a subset of the Drawings, Specifications
and documentation listed in Schedule B-1.

 

  1.1

For Review –

Owner shall be entitled to review and approve or disapprove all Drawings,
Specifications and other documents listed as “For Review” in Schedule B-1.
Review, approval and disapproval of such Drawings, Specifications and other
documents are governed in accordance with the Agreement, including Section 3.3C
of the Agreement.

 

B-1

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  1.2

For Information –

Drawings, Specifications and other documents labeled in Schedule B-1 as “For
Information” is to keep Owner informed as to the development of the Project.
Contractor shall review any comments provided by Owner with respect to these For
Information documents, and Contractor shall review these comments and advise
Owner of their disposition. Any comments provided by Owner, or failure of Owner
to provide comments, with respect to such For Information documents shall not in
any way be deemed to limit or in any way alter Contractor’s responsibility to
perform and complete the Work in strict accordance with the requirements of the
Agreement.

 

2.

As-Built Classification.

Contractor shall develop a document describing the process for the management of
Progress As-Built Drawings and Specifications and Record As-Built Drawings and
Specifications (collectively, “As-Builts”), which shall include identification
of requirements for As-Builts, identification of deliverables for As-Builts and
turnover of As-Builts. Such document shall be submitted to Owner for Owner’s
written approval within ninety (90) Days after issuance of the NTP. In the event
of any conflicts or inconsistencies between this document and the Agreement, the
terms and conditions in the Agreement shall govern.

As any changes to the Work occur through Change Order, Contractor shall update
the Drawings and Specifications and As-Builts to reflect such changes. In
addition, Contractor shall, on a timely basis, record in the Progress As-Built
Drawings and Specifications any differences between the as-built conditions and
the conditions shown in the issue for construction (IFC) Drawings,
Specifications and other documents. These requirements are in addition to the
requirements under Section 3.3F of the Agreement.

Contractor shall utilize the following two (2) criteria to define the completed
status of the As-Builts:

 

  2.1

As-Built (“AB”)

The information contained in this category of Drawings, Specifications and other
documents has been subjected to dimensional and/or visual survey and has been
verified by Contractor as being a true representation of the
as-installed/as-constructed/as-commissioned condition of the Work. The Drawing
or Specification shall be updated to show actual dimensions if a dimension
exceeds the specified fabrication tolerance. As-Builts shall be revised, date
stamped as a Contractor authorized “As-Built” and issued as a clean legible
copy, Arch E size for Drawings and 8-1/2” X 11” size for Specifications and
other documents (unless otherwise agreed in writing by Owner) free from any hand
written or red line mark-up information, discoloration, holds or clouds.

Drawings, Specifications and other documents required to be verified in
accordance with this Section 2.1 are shown in Schedule B-1.

 

  2.2

Latest Issue (Revision) (“LR”)

The information contained in this category of Drawings, Specifications and other
documents is limited to its current issued revision, and it also includes
Drawings, Specifications and other documents that have been updated in
accordance with the

 

B-2

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Contractor change control system to reflect the latest “Issued for Construction”
or “Issued for Commissioning” status of the Drawing, Specification or other
document.

The accuracy of the content of each Drawing, Specification and other document
shall not be verified by dimensional or visual survey and is only
representative. An index for each category of the Drawing, Specification or
other document revision record shall be issued to show Contractor’s latest
revision.

 

3.

Documentation Turnover.

 

  3.1

Documentation Turnover General Requirements

Unless otherwise prescribed in the Agreement, Contractor shall provide to Owner
an electronic copy (in accordance with Section 6 herein) of all Drawings,
Specifications and other documents (including engineering, Vendor, construction
and commissioning handover documentation) required in this Attachment B and
elsewhere in the Agreement. For Record As-Built Drawings required under the
Agreement, Contractor will provide Owner two hard copies of each Record As-Built
Drawing and electronic copies of such Record As-Built Drawings in the formats
set forth in Section 3.3E of the Agreement.

Vendor documentation may be delivered in the same format as received from the
Vendor provided they follow the standard agreed upon by Owner and Contractor in
writing to ensure that information is structured and indexed in a consistent
format.

Hard copy of all engineering documentation shall be collated by document
categories once the appropriate level of completeness for the As-Builts has been
attained as set forth above.

Contractor shall ensure a consistent approach is used to verify the technical
correctness and completeness of the information in relation to the appropriate
categorization of the As-Builts and to enable the Facility to be safe and
suitable for its intended function and use.

Areas of redundancy in Vendor documentation shall be identified to eliminate
multiple occurrences or copies of the same information.

The handover of such documentation shall be executed progressively in accordance
with a defined handover schedule that corresponds with Mechanical Completion of
all systems of Equipment for the Facility and is otherwise consistent with the
terms of the Agreement, including Section 3.3C. Contractor shall submit its
proposed handover schedule to Owner for review and prior written approval.

All hard copies of Drawings, Specifications and other documents shall, unless
specified otherwise, be clean, legible full size or 11” X 17” copies free from
any type of handwritten or red line mark-up information, discoloration, or
holds. The legibility of Drawings shall not be impaired if they are
photo-reduced to 11” X 17” size (i.e., P&ID’s) or have punched holes. The
technical content of a Drawing or Specification shall not be obscured by the
inclusion of foreign stamps.

When full-size Drawings are provided they must be folded to show the title block
and inserted into transparent wallets for inclusion in binders.

 

B-3

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When 11” X 17” Drawings are supplied within ring binders the punch holes shall
not obscure any part of the Drawing details.

 

  3.2

Engineering Documentation

All hard copy engineering documents by Contractor or any of its Subcontractors
or Sub-subcontractors shall be logically collated and indexed (e.g.,
Specifications, calculations, lists, etc.).

Contractor shall present to Owner the engineering documents in hard back binders
with front and back insert wallet, 3-post, expansion back from 5cm to 10 cm, 8
1/2” X 11” size sheets or 11” X 17” for Drawings, white colored. Binders shall
not exceed 8cm in thickness. The contract number or project number, project
title, Facility name, location, volume number and number of volumes shall be
identified on the spine of the binder.

All Contractor, Subcontractor and Sub-subcontractor documentation shall be
individually numbered and registered by Contractor in Contractor’s Electronic
Document Management System (“EDMS”). Integrity of any cross-references shall be
maintained.

Document number and document revision shall be consistent, complete and clearly
visible on all documents/Drawings. Page numbers shall be clearly visible on
multi-page documents. Document attributes shall be visible on the document front
sheet or drawing.

Documents originated electronically shall be supplied in both their native
format (provided that Contractor shall use commercially reasonable efforts to
obtain such native file format from Vendors in each case) and/or scanned image
file.

All engineering documents/Drawings shall be issued final according to their
appropriate classification for As-Builts.

All turnover documentation shall be issued with a formal handover transmittal.

A complete document and Drawing index shall be provided both in hard copy and
electronic versions.

3.2.1 Engineering Documentation Turnover

All Contractor submittals of documentation to Owner shall be organized in
categories, with each category organized based on the type of document
submitted. Listed below are examples of categories.

 

  •  

Specifications

 

  •  

Calculations – this will include process, system, Equipment, pipe stress,
instrument, electrical, etc.

 

  •  

Drawings – this will include process, P&ID’s, various lists (e.g. line list,
valve list, Equipment list, etc.) civil, piping, cause and effects, electrical,
instruments, architectural and building, civil and structural, etc.

 

  •  

Design Reports – this will include the Final Geotechnical Report, hazard
reviews, etc.

 

B-4

--------------------------------------------------------------------------------

  •  

Agreement Procedures – this will include Facility procedures (including
operation and maintenance procedures), Site QA/QC procedures, Facility start-up
procedures, commissioning procedures, etc.

 

  3.3

Vendor Documentation

Contractor shall ensure that Vendor data books and manufacturing record books
required by Schedule B-2 comply with a standard index approved by Owner.

All documents and Drawings shall be individually numbered and registered in the
EDMS. The integrity of internal cross-references shall be maintained.

Document number and document revision shall be consistent, complete and clearly
visible on all documents/Drawings. Page numbers shall be clearly visible on
multi-page documents.

All documents/Drawings within the Vendor data books shall be electronically
scanned. Contractor shall also obtain from Vendors a copy of any electronically
originated documents and Drawings in native file format, provided that
Contractor shall use commercially reasonable efforts to obtain such native file
format in each case from the Vendors. Such Drawings and documents shall be
submitted to Owner in accordance with Schedules B-1 and B-2 and the Agreement.

All final Vendor turnover document packages shall have a Contractor acceptance
stamp signed by the package engineer to verify that all the required
documentation have been approved and all other documentation has been reviewed,
is complete, technically accurate and to the required quality.

All turnover documentation is to be issued with a formal handover transmittal
that indexes all Drawings and documents included in the turnover document
package.

Contractor shall ensure Vendor documentation is revised as necessary to reflect
any subsequent engineering or Vendor changes or modifications, which shall be
done in accordance with the requirements of this Attachment B for As-Builts.

3.3.1 Vendor Documentation Turnover

All Contractor submittals of Vendor documentation to Owner shall be organized in
categories, with each category organized based on the type of document
submitted. Listed below are examples of categories.

 

  •  

Vendor Purchase Order Information – this shall include Vendor contract
information, unpriced copy of purchase order, master index, etc.

 

  •  

Vendor Engineering Documents – this shall include calculations, data sheets,
performance curves, etc.

 

  •  

Vendor Engineering Drawings – this shall include Vendor P&ID’s, general
arrangements, cross-sectional Drawings, wiring diagrams, logic diagrams, etc.

 

  •  

Vendor Manufacturing Records– this shall include certificate of conformity, list
of tagged items, certificates and reports by tagged item, etc.

 

B-5

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  •  

Vendor Equipment Operating Information – this shall include installation
information, operation information, maintenance information, special tools, etc.

 

4.

Substantial Completion Documentation.

 

  4.1

Substantial Completion Documentation Turnover.

Contractor shall deliver to Owner one (1) complete set of construction and
pre-commissioning records (collectively, the “Substantial Completion Handover
Package”) in hard copy upon submission to Owner of Contractor’s Substantial
Completion Certificate. Contractor shall prepare a table of contents for a
typical Substantial Completion Handover Package (which would, when completed,
include the documentation set forth in this Section 4) and shall submit this to
Owner for acceptance six (6) months before the Guaranteed Substantial Completion
Date.

Contractor shall submit the Substantial Completion Handover Package in hard back
binders with front and back insert wallet, 3-post, expansion back from 5cm to 10
cm, 8 1/2” X 11” size sheets or 11” X 17” for Drawings, white colored. Binders
are not to exceed 8cm thickness. The contract number or project number, project
title, Facility name, location, unit number, system/sub-system number, volume
number and number of volumes shall be identified on the spine of the binder.

The following Sections 4.1.1 through to 4.1.9 outline the general contents for
each section of the Substantial Completion Handover Package. The Facility will
be divided into systems and Substantial Completion Handover Packages shall be
prepared for each such system. Each package shall contain turnover documentation
for mechanical, piping, electrical, instrumentation and DCS attributes contained
in such system.

4.1.1 Listing of turnover documentation as applicable to that item of Equipment
or system:

 

  •  

Preventative maintenance logs for equipment

 

  •  

Alignment data (pumps, motors, compressors, fans and turbines)

 

  •  

Vibration data (compressors, pumps, fans and turbines)

 

  •  

Vessel closure reports

 

  •  

Instruments loop check data

 

  •  

Hydro test packages (see hydro test guidelines)

 

  •  

Line flush verification checklist

 

  •  

Fire protection and fire suppression test reports and certifications

 

  •  

Area lighting survey reports

 

  •  

System/sub-system Mechanical Completion checklists

4.1.2 Hydro and Pneumatic Test Data

 

  •  

Piping layout drawing(s) (underground only)

 

B-6

--------------------------------------------------------------------------------

  •  

Highlighted P&ID’s reflecting the piping system being tested

 

  •  

Test gage certification and calibration sheet(s)

 

  •  

Hydro or pneumatic test check and acceptance sheet(s)

 

  •  

High and low point vent(s) and drains that Contractor has added to facilitate
the hydro test shall be marked up on the pled or isometric drawings(s), and have
to be indicated on the P&IDs unless they ultimately become process taps.

 

  •  

Test certificate of test set relief valves

 

  •  

Post hydro or pneumatic punch and restore checklist

 

  •  

For stainless steel lines and Equipment, a water analysis certificate shall be
provided by Contractor prior to hydrotest, as applicable.

4.1.3 Relief Valve Data

 

  •  

P&ID’s for the relief system

 

  •  

Relief device or vacuum breaker specification sheet(s) (data sheets)

 

  •  

Calibration certificate

– Signed off by the qualified party that calibrated or set the relief point

– Signed by Contractor representative as “Accepted”.

Note: Should any modifications or other changes be required to any of the relief
devices or vacuum breakers prior to, or after installation, all calculations,
parts numbers for bellows, seats, spring changes, etc and certifications, must
be included in the relief device package in order to reflect the corrections
made to the relief device or vacuum breaker as installed.

4.1.4 Mechanical Equipment Data

The following guideline is to aid Contractor in building the mechanical
Equipment packages. The packages shall reflect the As-Built condition of each
item of rotating Equipment and/or fixed Equipment and the final status of any
related auxiliary systems.

 

  •  

Preliminary alignment reports

 

  •  

Final alignment report(s)

4.1.5 Instrument Loop Data

A loop is designated as “the initiating device through all control devices and
terminations of the final control element and/or display”.

 

  •  

Instrument loop diagram(s)

 

  •  

Instrument data sheet(s)

 

  •  

Instrument Specification sheet(s) for each instrument in the loop

 

B-7

--------------------------------------------------------------------------------

  •  

P&ID sheet(s) on which the instrument appears

 

  •  

Certified calibration data sheet(s)

 

  •  

Any electrical schematic Drawing(s) needed to determine the function of the
instrument in the E.O. motor control schematics, etc.

 

  •  

Loop acceptance data sheet on which the theoretical and actual value of the
measured, manipulated, controlled, and/or calculated variables in the loop will
be recorded during the acceptance testing of the loop function.

 

  •  

Loop acceptance sheet or certificate with provisions for a dated signature of an
authorized Contractor instrument technician performing the loop testing for
approval and Contractor’s representative accepting the loop.

 

  •  

Regarding the programmable logic controller (PLC) input/output (I/O) loops, the
PLC I/O schematic Drawing shall be substituted for the loop diagram in the loop
package if a loop Drawing for the PLC I/O was not produced. The affected
input(s) and output(s) should be highlighted on the Drawing.

4.1.6 Electrical Test Data Guidelines

The following guidelines are to be used in generating the electrical test data,
which are to be turned over to Owner for each Unit prior to the commissioning of
the applicable Unit.

4.1.6.1 Megger Log

The Megger log is a compilation report that lists all cables that were tested
and their results.

4.1.6.2 Preventative Maintenance (PM) Documentation

PM documentation for all motor lubrication, preventative maintenance logs, and
records of all preventative maintenance done on the motor from receipt at the
Site through Substantial Completion shall be included within the Substantial
Completion Handover Package for the applicable system.

 

  •  

Motor Megger Report (MMR)

 

  •  

MMR shall show all readings taken from time of receipt on Site until Substantial
Completion.

 

  •  

Motor overload relay heater element size of setting as installed

 

  •  

Motor Internal Heating Element (IHE) report, internal heaters are furnished

 

  •  

Motor Internal Resistance Temperature Device (RTD) report

 

  •  

Verify RTD type (nickel, platinum, etc.)

 

  •  

Motor run-in logs

 

  •  

The motor run-in logs provide a record of voltage, amperage, and temperature
readings during the run-in period.

4.1.6.3 High Potential Test Packages

 

B-8

--------------------------------------------------------------------------------

  •  

Test Equipment data, including Vendor, model number, serial number, and
calibration data

 

  •  

High potential test results for each cable, isolation, transfer switch, and
switchgear tested

 

  •  

All data pertinent to this Equipment shall be recorded (i.e., Vendor, serial
number, etc.)

4.1.6.4 Transformer Testing

 

  •  

Turns ratio comparison report

 

  •  

Dobble test report

 

  •  

Oil analysis report

 

  •  

Other reports (as required to document fitness for use)

4.1.6.5 Breaker Coordination Testing and Calibration Results

This is a listing of all information for each breaker and apparatus tested
(i.e., Vendor, serial number, model number, etc). Transformers, generator
breakers and medium voltage breaker test data shall be provided in the
Substantial Completion Handover Package as a separate system and as part of the
initial energization plan.

4.1.6.6 Earthing /Grounding Test (EGT) Reports

The EGT reports are a compilation of earthing/grounding resistance tests
results, identifying each earthing well tested and any corrective actions taken
to meet applicable Specifications.

4.1.6.7 Dielectric Oil Test Reports

Dielectric oil testing reports identify each piece of Equipment that is tested,
(to include the Vendor, serial number, model number, etc.), and the number of
samples taken. Samples will be taken on transformers, oil switches, oil filled
breakers, oil filled junction/splice boxes, etc.

4.1.6.8 Oil Sample Analysis

Vendor data shall be made available to ensure that no polychlorinated biphenyls
(PCBs) are present. A listing of the test results for each piece of Equipment
that has been tested shall be compiled, and is to include the Equipment Vendor,
serial number, model number, etc.

4.1.6.9 Cathodic Protection System Packages

If cathodic protection is utilized, a Cathodic Protection (CP) Package shall be
developed and shall include:

 

  •  

Cathodic protection test results

 

B-9

--------------------------------------------------------------------------------

  •  

All related underground Drawings showing cable locations, anode beds, etc.

 

  •  

Initial Megger readings of the cables prior to termination at the Equipment

 

  •  

Initial current readings imposed on the system(s)

4.1.6.10 Motor Control Centers (MCC) and Load Centers

Include Megger or high or high potential test reports, trip and overload relay
settings, and installed overload headers (if required). The reports will reflect
the Vendor, model, serial number, and test results for each piece of Equipment.

4.1.7 Permanent Overhead Crane & Lifting Devices

The test packages for any overhead cranes shall include:

 

  •  

Descriptive literature

 

  •  

Performance load charts

 

  •  

Dimensional Drawings

 

  •  

General arrangement Drawings

 

  •  

Electrical /wiring schematics

 

  •  

FAT documentation

 

  •  

Load cell certificates

 

  •  

Installation, operation and maintenance handbook

4.1.8 Progress As-Built Drawings and Specifications

Contractor shall provide to Owner a redline mark-up of all Progress As-Built
Drawings and Specifications no later than Substantial Completion. One (1) copy
of each redline shall be provided to Owner in addition to the copy returned to
Contractor’s home office for Drawing revision to incorporate redline corrections
as required. The requirements for Progress As-Built Drawings and Specifications
are noted in Section 2 of this Attachment B.

4.1.9 Substantial Completion Additional Documentation

Contractor shall prepare and provide to Owner as a minimum the following
documentation:

 

  •  

General system Substantial Completion Handover Package listing

 

  •  

Pre-commissioning procedures such as initial energization plan and piping flush
plans

 

  •  

Vendor visitation reports

 

  •  

Equipment preservation & maintenance records

 

B-10

--------------------------------------------------------------------------------

  •  

Material Safety Data Sheet handbook (a compilation of Vendor and other outside
source supplied MSDS(s)).

 

  •  

Vessel loading reports (desiccants, mol-sieves, etc.)

 

  •  

Chemical cleaning procedures & reports (if any)

 

  •  

Dryout procedures and reports

 

  •  

Radiography film and reader sheets

 

  •  

Non-destructive testing (NDT) reports other than radiography

 

  •  

Contractor shall deliver separately to Owner all original certificates or
Permits for Equipment which, according to Applicable Law, will require future
testing and re-certification by Owner

 

  •  

Building Inspection Reports/Fitness for Occupancy, including certificates of
occupancy, building completion reports, HVAC performance test reports, building
pressurization reports, fire detection system test report and fire protection
system test report

 

5.

Commissioning, Startup, and Performance Test Documentation.

In addition to other requirements under the Agreement, Contractor shall prepare
the following documentation:

 

  •  

Hot alignment reports,

 

  •  

Mechanical Completion Certificate in the form of Attachment L,

 

  •  

System start-up reports and completed and signed Mechanical Completion
checklists, and

 

  •  

Performance Test reports in accordance with Attachment S and the Agreement.

Documents prepared by Contractor shall be delivered to Owner in accordance with
the document turnover requirements.

 

  5.1

Laptops and Related Software for Turnover to Owner

Contractor shall prepare and maintain a list of all handhelds, laptops and
related software packages that are required for future maintenance adjustments
associated with Equipment related local logic control stations. These items are
initially identifiable from the purchase order but are subject to change as a
result of Vendor software changes/upgrades during commissioning. It is the
responsibility of Contractor to maintain the list to ensure that the latest
software version is recorded in the list.

For all computer based programmable Equipment supplied by Contractor as part of
the Work, Contractor shall provide Owner with all software necessary to maintain
and make minor modifications to the programmable Equipment. For illustrative
purposes, examples of programmable Equipment are DCS, SIS, package unit PLC’s,
PA/GA system, etc. This includes Contractor providing for the transfer to Owner
of the software licenses at Substantial Completion. Contractor shall also
provide electronic copies (EEPROM, SD Card, etc.) of “as left” programs on such
programmable Equipment.

 

B-11

--------------------------------------------------------------------------------

  5.2

Historical Records

The Contractor EDMS shall be capable of maintaining historical records of
previous issued documents.

The EDMS should include complete document history, including copies of earlier
document versions, revision logs, and access logs.

Historical versions of formal revisions of documents shall be maintained
electronically in the Contractor EDMS and shall form part of the formal turnover
requirements to Owner.

 

6.

Electronic Document Turnover Requirements.

 

  6.1

Native Files of Documents/Drawings

Documents generated by Contractor, its Subcontractors and Sub-subcontractors
(including Vendors) using standard applications (i.e., MS Word, Excel,
PowerPoint, Project, Visio, Access, etc.), shall also be delivered to Owner at
Substantial Completion. These documents shall be turned-over in their native
file format, provided that Contractor shall use reasonable efforts to obtain
such native file format from Vendors in each case.

All Contractor-generated Drawings shall be provided in Microstation, AutoCad.dwg
and .pdf format as required by Section 3.3E of the Agreement and shall be
checked by Contractor for correctness after conversion to any such format.

 

  6.2

Contractor Commercial Applications

When Contractor employs a commercial application to store and manipulate data
during the execution of the Work, Contractor shall turnover the native data
files associated with the commercial applications in a format agreed upon by
Owner and Contractor.

 

  6.3

Contractor Propriety Applications

Owner recognizes that Contractor may wish to employ computer applications
proprietary to Contractor in the execution of the Work. Contractor shall either
provide Owner with a perpetual, royalty-free license to use such proprietary
software or, if allowed by Owner in writing, extract the data and provide it in
a publicly available format specified by Owner.

 

  6.4

EDMS Register

Contractor shall also transfer to Owner a register detailing the full contents
of the Contractor EDMS.

 

B-12

--------------------------------------------------------------------------------

SCHEDULE B-1

OUTLINE OF OWNER DOCUMENT SUBMITTAL REQUIREMENTS FOR REVIEW OR INFORMATION

In addition to the requirements under the Agreement, Contractor shall be
responsible for providing Owner with all of the Drawings, Specifications and
other documents required under this Schedule B-1 and any and all other Drawings,
Specifications and other documents not listed below but required under the
Agreement or for the performance of the Work.

 

No

  

Category

  

Drawing/Specification/

Document Type

  

For Review* /

For Information

  

Timing of Delivery

of Drawings,

Specifications/Documents**

  

As-Built

Classification***

***

   ***    ***    ***    ***    ***

 

B-13

--------------------------------------------------------------------------------

SCHEDULE B-2

OUTLINE OF MINIMUM VENDOR DOCUMENT REQUIREMENTS BY EQUIPMENT CATEGORY

In addition to the requirements under the Agreement, Contractor shall be
responsible for providing Owner with all of the following Vendor documentation
(including Drawings and Specifications) required under this Schedule B-2 and any
and all other Vendor documentation not listed below but required under the
Agreement or for the performance of the Work.

 

No.

  

Equipment Category

  

Vendor Document Requirements

  

COMMENTS

***

   ***    ***    ***

 

B-14

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT C

PAYMENT SCHEDULE

 

--------------------------------------------------------------------------------

SCHEDULE C-1

EPC PAYMENT MILESTONES

 

EPC

Payment

Milestone

Number

  

EPC Payment Milestone Description

  

Amount

(U.S.$)

***

   ***    ***

Contractor shall provide reasonable, objectively verifiable information to
evidence achievement of each EPC Payment Milestone which may include (i) notices
to proceed sent to Subcontractors or Sub-subcontractors, (ii) invoices,
(iii) executed Purchase Orders, (iv) photographs, (v) packing slips, (vi) bills
of lading and (vii) test reports. Subcontractor and Sub-subcontractor pricing
information may be redacted from such documentation.

As further set forth in Section 7.2E of the Agreement, the cumulative EPC
Payment Milestone amounts which are due under the Agreement shall be subject to
the Maximum Cumulative Payment Schedule for EPC Payment Milestones as set forth
in Section II of Schedule C-3.

1. “Begin” means that full production operations with respect to the listed task
is underway and such task is capable of being performed on a continuous basis.

2. “BOP” means all Equipment for the Facility other than the Siemens Equipment.

3. “Demobilization” means removal from the Site of all of Contractor’s,
Subcontractors’ and Sub-subcontractor’s personnel, supplies, materials, rubbish,
temporary facilities and construction equipment.

4. “Design Criteria” means a multi-discipline document produced by Contractor
that details the engineering assumptions, code requirements, and analysis
methods to be employed by Contractor for the calculations and analysis portion
of the Work.

5. “Issue for Review” means that Contractor delivers an item for Owner’s review,
unless otherwise noted. Items issued for review are completed upon Owner’s
receipt of such items.

6. “Issue for Approval” means that Contractor delivers an item to Owner for
review and written approval. Such item is complete upon Owner’s written approval
in accordance with Section 3.3C of the Agreement.

7. “Mobilize” or “Mobilization” means (i) with respect to construction
equipment, that such construction equipment has been inspected and is available
for use at the Site and (ii) with respect to personnel, such personnel have been
dispatched to the Site and are ready to Begin the Work.

8. “Purchase Order” means a Subcontract (as such term is defined in Section 1.1
of the Agreement) for the supply of Equipment.

9. “Shop PO” means a purchase order from Contractor to the applicable
Subcontractor for purchase of the materials required to fabricate the Equipment
purchased under the applicable Purchase Order.

--------------------------------------------------------------------------------

Execution Version

SCHEDULE C-2

SIEMENS EQUIPMENT PAYMENT MILESTONES

 

Siemens

Equipment

Payment

Milestone

#

  

Siemens Equipment Payment Milestone*

   Siemens
Equipment
Payment
Milestone
Amount  Due
(US$)    Cumulative
Siemens
Equipment
Payment
Milestone
Amounts**
(US$)    Siemens
Equipment
Payment
Milestone Portion
Attributable  to
Services***
(US$)    Siemens
Equipment
Payment
Milestone Portion
Attributable to
Transportation***
(US$)    Siemens Equipment
Payment Milestone
Portion
Attributable  to
Equipment***
(US$)

***

   ***    ***    ***    ***    ***    ***

Payment terms are per the Agreement.

 

*

Contractor shall provide reasonable, objectively verifiable documentation to
evidence achievement of each Siemens Equipment Payment Milestone. The Parties
agree that the following is considered reasonable and objectively verifiable
evidence to demonstrate completion of the portion of the Work associated with
the Siemens Equipment Payment Milestone: notices to proceed sent to
Sub-subcontractors, invoices, executed purchase orders, photographs, packing
slips, and bills of lading. Pricing and proprietary information may be redacted
from all documentation provided by Siemens.

**

As further set forth in Section 7.2E of the Agreement, the cumulative Siemens
Equipment Payment Milestone amounts which are due under the Agreement shall be
subject to the Maximum Cumulative Payment Schedule for Payment Milestones as set
forth in Section I of Schedule C-3.

***

The columns which illustrate the allocation of the Siemens Equipment Payment
Milestone value among services, transportation and Equipment costs are set forth
herein for purposes of calculation of applicable California sales and use Taxes
under the Siemens Contract.

***

--------------------------------------------------------------------------------

Execution Version

SCHEDULE C-3

MAXIMUM CUMULATIVE PAYMENT SCHEDULE

 

Section I. Maximum Cumulative Payment Schedule for Siemens Equipment Payment
Milestones

 

Project Schedule*

  

Maximum Cumulative Payment

Due for Siemens Equipment

Payment Milestones

(US$)1

***

   ***

***

--------------------------------------------------------------------------------

Section II.

Maximum Cumulative Payment Schedule for the EPC Payment Milestones and Maximum
Demobilization and Subcontractor Cancellation Cost Schedule (1)

 

Dates(2)

  

Maximum Cumulative Payment for EPC

Payment Milestones Performed Through

Such Month (US$)(3) (4)

  

Maximum Demobilization and

Subcontract Cancellation Cost

(US$)(5)

   EPC Payment
Milestone portion
of the Contract
Price (US$) ***    ***    ***    ***

***

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT D

FORM OF CHANGE ORDER

 

D-1

--------------------------------------------------------------------------------

SCHEDULE D-1

CHANGE ORDER FORM

(for use when the Parties mutually agree upon and execute the Change Order
pursuant to Section 6.1B or 6.2C)

 

PROJECT NAME: Marsh Landing Generating Station

 

CHANGE ORDER NUMBER:                                         

OWNER: Mirant Marsh Landing, LLC

 

DATE OF CHANGE ORDER:                                         

CONTRACTOR: Kiewit Power Constructors Co.

 

DATE OF AGREEMENT: [                    , 20    ]

 

 

 

 

The Agreement between the Parties listed above is changed as follows: (attach
additional documentation if necessary)

 

Adjustment to Contract Price

 

1.

 

The original Contract Price was

   $                             

2.

 

Net change by previously authorized Change Orders (#                )

   $                             

3.

 

The Contract Price prior to this Change Order was

   $                             

4.

 

The EPC Payment Milestone portion of the Contract Price prior to this Change
Order was

   $                             

5.

 

The Siemens Equipment Payment Milestone portion of the Contract Price prior to
this Change Order was

   $                             

6.

 

The EPC Payment Milestone portion of the Contract Price will be (increased)
(decreased) (unchanged) by this Change Order in the amount of

   $                             

7.

 

The Siemens Equipment Payment Milestone portion of the Contract Price will be
(increased) (decreased) (unchanged) by this Change Order in the amount of

   $                             

8.

 

As a result of the changes set forth by Lines 6 and 7 above, the Contract Price
will be (increased) (decreased) (unchanged) by this Change Order in the amount
of

   $                             

9.

 

The new Contract Price including this Change Order will be

   $                             

Adjustment to dates in Key Milestone Schedule & Completion Dates

The following dates are modified (list all dates modified; insert N/A if no
dates modified; attach additional documentation if necessary):

The Key Milestone Date for                          will be
(increased)(decreased)(unchanged) by              (    ) calendar days.

The Key Milestone Date for                          as of the date of this
Change Order therefore is                         , 20    .

(list all Key Milestones that are modified by this Change Order using the format
set forth above)

The Guaranteed Substantial Completion Date will be
(increased)(decreased)(unchanged) by              (    ) calendar days.

The Guaranteed Substantial Completion Date as of the date of this Change Order
therefore is                         , 20    .

The Required Final Completion Date will be (increased)(decreased)(unchanged) by
             (    ) calendar days.

The Required Final Completion Date as of the date of this Change Order therefore
is                         , 20    .

Impact to other Changed Criteria (insert N/A if no changes or impact; attach
additional documentation if necessary)

Impact on Payment Schedule (including, as applicable, Payment Milestones and the
Maximum Cumulative Payment Schedules):

 

D-2

--------------------------------------------------------------------------------

If adjustment made to Siemens Equipment Payment Milestones, allocation of such
adjustment among compensation for (i) Transportation, (ii) Services and
(iii) Equipment:

Impact on Minimum Acceptance Criteria:

Impact on Performance Guarantees:

Impact on Design Basis:

Other impacts to liability or obligations of Contractor or Owner under the
Agreement:

Upon execution of this Change Order by Owner and Contractor, the
above-referenced change shall become a valid and binding part of the original
Agreement without exception or qualification, unless noted in this Change Order.
Except as modified by this and any previously issued Change Orders, all other
terms and conditions of the Agreement shall remain in full force and effect.
This Change Order is executed by each of the Parties’ duly authorized
representatives.

 

 

    

 

Owner

    

Contractor

 

    

 

Name

    

Name

 

    

 

Title

    

Title

 

    

 

Date of Signing

    

Date of Signing

 

D-3

--------------------------------------------------------------------------------

SCHEDULE D-2

OWNER-DIRECTED CHANGE ORDER FORM

(for use when only Owner executes the Change Order pursuant to Section 6.1C or
6.2D)

 

PROJECT NAME: Marsh Landing Generating Station

 

CHANGE ORDER NUMBER:                                         

OWNER: Mirant Marsh Landing, LLC

 

DATE OF CHANGE ORDER:                                         

CONTRACTOR: Kiewit Power Constructors Co.

 

DATE OF AGREEMENT: [                    , 20    ]

 

 

 

 

You are hereby directed to make the following change(s) in this Agreement:
(attach additional documentation if necessary)

 

 

 

Compensation for the changes specified in this Change Order are on a time and
materials basis as provided in Section 6.1C and 6.2D of the Agreement.

When signed by Owner and received by Contractor, this document becomes effective
IMMEDIATELY as a Owner-directed Change Order, and Contractor shall commence with
the performance of the change(s) described above within five (5) Business Days
of its receipt unless another time is expressly stated above. This Change Order
is signed by Owner’s duly authorized representative.

 

 

Owner

 

Name

 

Title

 

Date of Signing

 

D-4

--------------------------------------------------------------------------------

SCHEDULE D-3

CONTRACTOR’S CHANGE ORDER REQUEST FORM

 

PROJECT NAME: Marsh Landing Generating Station

  CHANGE ORDER REQUEST NUMBER:                     

OWNER: Mirant Marsh Landing, LLC

 

DATE OF CHANGE ORDER REQUEST:                     

CONTRACTOR: Kiewit Power Constructors Co.

 

DATE OF AGREEMENT: [                    , 20    ]

 

 

 

 

Contractor Proposes the Following Change(s) in the Agreement: (attach additional
documentation, if necessary)

 

 

 

Detailed Reasons for Proposed Change(s) (provide detailed reasons for the
proposed change, and attach all supporting documentation required under the
Agreement)

 

 

 

Proposed Adjustments to Agreement (attach additional documentation, if
necessary)

Contract Price Adjustment (including an itemization of the adjustment to the
Siemens Equipment Payment Milestone and EPC Payment Milestone portions of the
Contract Price):

If Siemens Equipment Payment Milestone adjustment is proposed, allocation of
such proposed adjustment among (i) Transportation, (ii) Services and
(iii) Equipment:

Adjustment to Key Milestones (list all Key Milestones to be adjusted):

Adjustment to Guaranteed Substantial Completion Date:

Adjustment to Required Final Completion Date:

Adjustment to Payment Schedule:

Adjustment to Minimum Acceptance Criteria:

Adjustment to Performance Guarantees:

Adjustment to Design Basis:

Other adjustments to liabilities or obligations of Contractor or Owner under the
Agreement:

This request for Change Order is signed by Contractor’s duly authorized
representative.

 

 

Contractor

 

Name

 

Title

 

Date of Signing

 

D-5

--------------------------------------------------------------------------------

SCHEDULE D-4

PRICING FOR CHANGE ORDERS

Initial Standard Published Rates for Contractor-Owned Construction Equipment1

 

Description Make and Model

   Hourly Rate   Daily Rate   Weekly Rate   Monthly
Rate

***

   ***   ***   ***   ***

 

1

***

 

D-6

--------------------------------------------------------------------------------

Initial Published 2.5 X Multiplier Engineering Services Rates for Project
Management, Engineering and

Design Services from Kiewit Power Constructor Co.

(Effective April 1, 2009 to March 31, 2010)

 

Professional Level

  

Hourly Rate (U.S.$)

***

   ***

 

D-7

--------------------------------------------------------------------------------

Initial Published 2.5 X Multiplier Engineering Services Rates for Home Office
Project Management,

Engineering and Design Services from Kiewit Power Engineers Co.’s Engineers &
Consultants

(Effective until April 26, 2010)

 

Professional Level

   1
(U.S.$)   2
(U.S.$)   3
(U.S.$)

***

   ***   ***   ***

 

D-8

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT E

KEY MILESTONE SCHEDULE

 

1

  

2

  

3

  

4

  

5

Key Milestone

  

Key Milestone Date*

  

Days of Delay to
Initiate Recovery

  

Total Days of Delay for
Default**

  

Default Date*

***

   ***    ***    ***    ***

 

*

The Key Milestone Dates and Default Dates set forth herein are anticipated dates
based upon preliminary project scheduling activities. The Key Milestone Dates
and Default Dates set forth herein shall be updated by Change Order once the CPM
Performance Measurement Baseline Schedule is agreed upon by the Parties in
accordance with the Agreement.

**

The “Total Days of Delay for Default” sets forth the total number of days of
actual or expected delay (beyond the Key Milestone Date) upon which gives rise
to a Contractor Default under the Agreement.

***

 

E-1

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT F

KEY PERSONNEL AND CONTRACTOR’S ORGANIZATION

The following individuals are Key Personnel. In accordance with Section 2.2A of
the Agreement, Key Personnel shall, unless otherwise expressly stated in this
Attachment F, be devoted essentially full-time to the Work for the entire
duration of the Work, and Key Personnel shall not be removed or reassigned
without Owner’s prior written approval.

 

Name

  

Position

  

Status / Duration

***    ***    ***

All initial Key Persons shall be subject to Owner’s written approval.

 

*

After Substantial Completion, the Overall Project Manager shall remain available
on a part-time basis in order to attend applicable meetings, assist in resolving
issues regarding Defective Work and Warranties, etc.

**

After Substantial Completion, the indicated Key Persons may reduce their
commitment to a part-time basis (as opposed to full-time basis) to the extent
that such reduced commitment continues to allow such Key Person to properly and
timely manage Contractor’s performance of its remaining obligations under the
Agreement.

 

F-1

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT G

APPROVED SUBCONTRACTORS AND SUB-SUBCONTRACTORS

Contractor and Owner have approved the following Subcontractors and
Sub-subcontractors for the performance of the Work specified with respect to
each such Subcontractor or Sub-subcontractor. Contractor may solicit bids from,
and enter into a Subcontract with, any of the following Subcontractors; provided
that Contractor shall, at a minimum, solicit bids from those Subcontractors
marked with an asterisk (*) with respect to the portion of Work identified for
such Subcontractors. Contractor’s selection of any Subcontractor or
Sub-subcontractor in this Attachment G, including those marked with an asterisk,
does not relieve Contractor of any obligations under the Agreement.

 

PORTION OF THE WORK

  

APPROVED SUBCONTRACTORS AND

SUB-SUBCONTRACTORS

***

   ***

 

G-1

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT H

NOTICE TO PROCEED FORMS

 

H-1

--------------------------------------------------------------------------------

SCHEDULE H-1

FORM OF LIMITED NOTICE TO PROCEED

                    , 20    

Kiewit Power Constructors Co.

9401 Renner Blvd.

Lenexa, Kansas 66219

Facsimile: 913-928-7214

Attention: Kevin Needham

 

Re:

Limited Notice to Proceed

Pursuant to Section 5.2 of the Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Marsh Landing Generating Station, dated as
of [                    , 20    ] (the “Agreement”), by and between Mirant Marsh
Landing, LLC (“Owner”) and Kiewit Power Constructors Co. (“Contractor”), this
letter shall serve as a Limited Notice to Proceed from Owner to Contractor
authorizing Contractor to proceed with that certain portion of the Work as
described below pursuant to the terms and conditions of the Agreement:

 

 

 

  

(“LNTP Work”).        

Contractor is authorized under this Limited Notice to Proceed to incur no more
than                      U.S. Dollars (U.S.$             ) for performance of
the foregoing LNTP Work. No other amounts are authorized under this Limited
Notice to Proceed for any other services, labor or Work. Contractor shall be
paid for such specified LNTP Work pursuant to the terms and conditions of the
Agreement, with all such payments credited against the Contract Price and the
first payment(s) to become due under the Agreement.

 

For and on behalf of

MIRANT MARSH LANDING, LLC

By:

 

 

Title:

 

 

 

cc:

  

 

  

 

H-2

--------------------------------------------------------------------------------

SCHEDULE H-2

FORM OF NOTICE TO PROCEED

                         , 20    

Kiewit Power Constructors Co.

9401 Renner Blvd.

Lenexa, Kansas 66219

Facsimile: 913-928-7214

Attention: Kevin Needham

 

Re:

Notice to Proceed

Pursuant to Section 5.2E of the Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Marsh Landing Generating Station, dated as
of [                    , 20    ] (the “Agreement”), by and between Mirant Marsh
Landing, LLC (“Owner”) and Kiewit Power Constructors Co. (“Contractor”), this
letter shall serve as the Notice to Proceed from Owner to Contractor authorizing
Contractor to proceed with the Work pursuant to the terms and conditions of the
Agreement.

 

For and on behalf of

MIRANT MARSH LANDING, LLC

By:

 

 

Title:

 

 

 

cc:

  

 

  

 

H-3

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT I

FORM OF CONTRACTOR’S INVOICES

 

I-1

--------------------------------------------------------------------------------

SCHEDULE I-1

FORM OF CONTRACTOR’S INTERIM INVOICE

 

PROJECT NAME: Marsh Landing Generating Station

  

INVOICE NUMBER:                     

OWNER: Mirant Marsh Landing, LLC

  

DATE OF INVOICE:                     , 20    

CONTRACTOR: Kiewit Power Constructors Co.

  

DATE OF AGREEMENT: [                    ]

  

 

 

This Invoice covers EPC Payment Milestone No(s).              and Siemens
Equipment Payment Milestone No(s).              set forth in Schedules C-1 and
C-2 of the Agreement for the period (“Invoice Period”) from
                    , 20     to                     , 20     (“Current Date”).
Contractor hereby makes application for payment to Owner as shown below in
connection with the above referenced Agreement between the Parties.

 

1.

  

Original Contract Price (Section 7.1 of Agreement)

   US$                     

2.

  

Net change by Change Orders (except Owner-directed Change Orders) (Exhibit 3)

   US$                     

3.

  

Contract Price to date (Line 1 + Line 2)

   US$                     

4.

  

Total earned to date for completion of Work under EPC Payment Milestones
including Retainage (Sum of Column E and F of Section 1 of Exhibit 1)

   US$                     

5.

  

Retainage for completion of Work under EPC Payment Milestones (Column G of
Section 1 of Exhibit 1)

   US$                     

6.

  

Total earned to date for completion of Work under EPC Payment Milestones less
Retainage (Line 4 - Line 5)

   US$                     

7.

  

Total earned to date for completion of Work under Siemens Equipment Payment
Milestones (Sum of Column E and F of Section 2 of Exhibit 1)

   US$                     

8.

  

Total earned to date on Owner-directed Change Orders (Exhibit 2)

   US$                     

9.

  

California sales and use Tax invoiced to Contractor to date under the Siemens
Contract (Exhibit 6)

   US$                     

10.

  

Total earned to date (not including Retainage) plus California sales and use Tax
invoiced to date to Contractor under the Siemens Contract (Line 6 + Line 7+ Line
8 + Line 9)

   US$                     

11.

  

Less previous Invoices (Line 10 from prior Invoice)

   US$                     

12.

  

Current Payment Due (Line 10 less Line 11)

   US$                     

Contractor certifies that (i) the Work is progressing in accordance with the Key
Milestone Schedule and CPM Performance Measurement Baseline Schedule, except to
the extent (if any) expressly set forth in the current Monthly Progress Report
or Monthly Updated CPM Schedule, (ii) the Work described in or relating to this
Invoice has been performed and supplied in full accordance with the Agreement,
(iii) prices in this Invoice and attached Exhibits are correct and in accordance
with the Agreement and the referenced Payment Milestone(s) are complete,
(iv) Contractor is entitled to payment of the amount set forth as “Current
Payment Due” in this Invoice, and such Current Payment Due constitutes in full
all amounts due and owing as of the Current Date, (v) the Work and any portion
thereof described in or relating to this Invoice and all previous Invoices are
free and clear of all liens, security interests and encumbrances through the
date of this Invoice, (vi) all Subcontractors have been paid the monies due and
payable for Work performed in connection with the Facility (except for any
amounts owed such Subcontractors for Work billed under this Invoice),
(vii) fully completed and executed Interim Waiver and Release of Liens and
Interim Claim Waivers from Contractor and from all Major Subcontractors who
performed Work relating to this Invoice, are attached to this Invoice, (viii) if
requested by Owner and required by the Agreement, fully completed and executed
Interim Waiver and Release of Liens and Interim Claim Waivers from all Major
Sub-subcontractors who performed Work relating to this Invoice, are attached to
this Invoice, (ix) attached to this Invoice is all documentation supporting
Contractor’s request for payment as required under the Agreement and (x) this
Invoice is signed by an authorized representative of Contractor.

 

CONTRACTOR

       Subscribed and sworn to before me this                      day of
                    , 20    .

Signed:

 

 

       

Name:

 

 

       

Title:

 

 

    

 

  

Date:

 

 

 

, 20

 

         

     Notary Public               My Commission Expires:                     ,
20    

 

I-2

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MARSH LANDING GENERATING STATION

 

INVOICE NUMBER             

   INVOICE DATE                     , 20    

OWNER APPROVAL

AMOUNT APPROVED by Owner for Payment: US$                                

 

OWNER       

Signed:

 

 

    

Name:

 

 

    

Title:

 

 

    

Date:

 

 

 

, 20

 

         

    

The AMOUNT APPROVED by Owner is without prejudice to any rights of Owner under
the Agreement.

Explanation is listed below or attached if the AMOUNT APPROVED is less than the
amount requested by Contractor under this Invoice:

 

 

 

 

 

 

 

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EXHIBIT 1

COMPLETION OF PAYMENT MILESTONES

1. EPC PAYMENT MILESTONES: The following EPC Payment Milestones were completed
and invoiced in prior Invoices or were completed by Contractor within this
Invoice Period.

 

A

  

B

  

C

  

D

  

E

  

F

  

G

  

H

Item

No.

  

Description of EPC
Payment Milestone

  

Original EPC
Payment Milestone
Amount

  

EPC Payment
Milestone Amount as
Adjusted by Change
Order

  

EPC Payment
Milestone Amount
Previously
Invoiced*

  

EPC Payment
Milestone

Amount for this
Invoice

Period**

  

Retainage
Withheld***

  

Cumulative Amounts
Paid by Owner, or
Invoiced to Owner, for
EPC Payment
Milestones (less
Retainage Withheld)

                                                                                
                                                                                
                                                                                
        

Total

                    

 

*

Column E contains the full EPC Payment Milestone amount for EPC Payment
Milestones that were fully completed in accordance with the Agreement and
invoiced in prior Invoices. No partial EPC Payment Milestone amounts shall be
included, and Contractor shall not include any amounts for partially completed
EPC Payment Milestones. If amounts listed in this Column E are left blank or are
identified as “$0” (or similar indication), such identification indicates that
the applicable EPC Payment Milestone was not completed and invoiced in a prior
Invoice.

**

Column F contains the full EPC Payment Milestone amount for EPC Payment
Milestones that were fully completed in accordance with the Agreement during the
Invoice Period covered by this Invoice. No partial EPC Payment Milestone amounts
shall be included, and Contractor shall not include any amounts for partially
completed EPC Payment Milestones. If amounts listed in this Column F are left
blank or are identified as “$0” (or similar indication), such identification
indicates that the applicable EPC Payment Milestone was not completed and
invoiced within this Invoice Period.

***

Column G shall include the amount of Retainage withheld from each EPC Payment
Milestone that was previously completed and invoiced in prior Invoices or
completed and invoiced within this Invoice Period.

 

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2. SIEMENS EQUIPMENT PAYMENT MILESTONES: The following Siemens Equipment Payment
Milestones were completed and invoiced in prior Invoices or were completed by
Contractor within this Invoice Period.

 

A

  

B

  

C

  

D

  

E

  

F

Item

No.

  

Description of Siemens Equipment
Payment Milestone

  

Original Siemens
Equipment Payment
Milestone Amount

  

Siemens Equipment
Payment Milestone
Amount as Adjusted by
Change Order

  

Siemens Equipment
Payment Milestone
Amount Previously
Invoiced*

  

Siemens Equipment
Payment Milestone
Amount for this Invoice
Period**

                                                                                
                                      

Total

              

 

*

Column E contains the full Siemens Equipment Payment Milestone amount for
Siemens Equipment Payment Milestones that were fully completed in accordance
with the Agreement and invoiced in prior Invoices. No partial Siemens Equipment
Payment Milestone amounts shall be included, and Contractor shall not include
any amounts for partially completed Siemens Equipment Payment Milestones. If
amounts listed in this Column E are left blank or are identified as “$0” (or
similar indication), such identification indicates that the applicable Siemens
Equipment Payment Milestone was not completed and invoiced in a prior Invoice.

**

Column F contains the full Siemens Equipment Payment Milestone amount for
Siemens Equipment Payment Milestones that were fully completed in accordance
with the Agreement during the Invoice Period covered by this Invoice. No partial
Siemens Equipment Payment Milestone amounts shall be included, and Contractor
shall not include any amounts for partially completed Siemens Equipment Payment
Milestones. If amounts listed in this Column F are left blank or are identified
as “$0” (or similar indication), such identification indicates that the
applicable Siemens Equipment Payment Milestone was not completed and is not
being invoiced in this Invoice Period.

 

I-5

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EXHIBIT 2

OWNER-DIRECTED CHANGE ORDERS

1. WORK COMPLETED UNDER OWNER-DIRECTED CHANGE ORDERS: The following Work has
been completed in accordance with the Agreement under Owner-directed Change
Orders executed by Owner pursuant to Section 6.1C or Section 6.2D.

 

No.

  

Description of Owner-directed

Change Order

  

Work Completed (From

Previous Invoices) (US$)

  

Work Completed (This

Invoice Period) (US$)*

                                            

Total

        

* The amounts in this column shall be further detailed in Section 2 below for
each Change Order.

2. CALCULATION OF TIME AND MATERIAL CHARGES FOR OWNER-DIRECTED CHANGE ORDERS:
The following table illustrates the costs incurred in performing any Change
Orders on a time and material basis for this Invoice Period and in accordance
with Section 6.3 of the Agreement.

 

A

  

B

  

C

  

D

  

E

  

F

  

G

  

H

  

I

  

J

No.

  

Description of
Owner-directed
Change Order

  

Direct Craft
Labor Costs
(US$)

  

Small Tools and
Supplies Costs
(***)

  

Construction
Equipment
Costs (US$)

  

Materials
and
Subcontracts
Costs (US$)

  

Project
Management,
Engineering
& Design
Costs (US$)

  

California
Sales and Use
Taxes (US$)

  

General and
Administrative
Expenses
(US$)

  

Profit (US$)

                                                                                
                                                     

Total

                          

The direct craft labor costs set forth in Column C above shall be itemized by
each craft laborer employed for such Work, the applicable hourly rate and the
hours expended by each laborer for each of the above Change Orders. Contractor
shall provide support for such hours and allocation to applicable Change Orders
through daily work logs, time sheets and other reasonable, objectively
verifiable supporting documentation.

The total direct craft labor hours expended on the applicable Change Order (as
supported by the documentation set forth in the foregoing sentence) shall be
used

 

I-6

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to determine the small tool and supplies amount for Column D above.

The construction equipment costs for Column E and materials and subcontract
costs in Column F shall be supported by invoices, purchase orders, Contractor’s
work logs (for Contractor-owed construction equipment) and other reasonable,
objectively verifiable supporting documentation.

The project management, engineering and design costs set forth in Column G above
shall be itemized by each professional employed for such Work, the applicable
hourly rate and the hours expended by each professional for each of the above
Change Orders. Contractor shall provide support for such hours and allocation to
applicable Change Orders through daily work logs, time sheets and other
reasonable, objectively verifiable supporting documentation.

For purposes of determining the reimbursement to Contractor of California sales
and use Taxes pursuant to Section 6.3F of the Agreement, such California sales
and use Taxes to be reimbursed to Contractor (as set forth in Column H above)
shall be determined by applying the applicable sales and use tax rate to (a) the
taxable materials and subcontracts costs within the amounts set forth in Column
F and (b) any taxable third party construction equipment rental costs within the
amounts set forth in Column E incurred by Contractor.

The amounts set forth in Column I (general and administrative expenses) and
Column J (profit) shall be calculated in accordance with Sections 6.3G and 6.3H
(respectively) of the Agreement.

 

I-7

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EXHIBIT 3

LIST OF MUTUAL CHANGE ORDERS

The following Change Orders have been executed by Owner and Contractor pursuant
to Section 6.1B or Section 6.2C.

 

No.

  

Description of Change Order

   US$                                                                        
     

Total

     

 

I-8

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EXHIBIT 4

INTERIM WAIVER AND RELEASE OF LIENS

AND

INTERIM CLAIM WAIVERS

 

I-9

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EXHIBIT 5

INFORMATION REQUIRED OR REQUESTED BY OWNER

 

I-10

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EXHIBIT 6

CALIFORNIA SALES AND USE TAX INVOICED TO CONTRACTOR

UNDER THE SIEMENS CONTRACT

 

Amount of California sales and

use Tax invoiced to Contractor

under the Siemens Contract

and requested by Contractor

 

Invoice No. and Invoice date in

which California sales and use Tax

was invoiced by Siemens to

Contractor

 

Date that such California sales

and use Tax was paid to the State

by Contractor

                                   

Total California sales and use Tax invoiced to Contractor by Siemens to date
under the Siemens Contract:             

 

I-11

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SCHEDULE I-2

FORM OF CONTRACTOR’S FINAL INVOICE

 

PROJECT NAME: Marsh Landing Generating Station

  

INVOICE NUMBER:                     

OWNER: Mirant Marsh Landing, LLC

  

DATE OF INVOICE:                     , 20    

CONTRACTOR: Kiewit Power Constructors Co.

  

DATE OF AGREEMENT: [                    ]

  

 

 

This final Invoice covers (i) under Section I, EPC Payment Milestone No(s).
             and Siemens Contract Payment Milestone No(s).              set
forth in Schedules C-1 and C-2 of the Agreement for the period (the “Invoice
Period”) from                     , 20     to                     , 20     and
(ii) under Section II, any adjustments required to reconcile all previous
Invoices, payments and Change Orders.

I. APPLICATION FOR PAYMENT. Contractor hereby makes application for final
payment to Owner under the Agreement, as shown below.

 

1.

 

Original Contract Price (Section 7.1 of Agreement)

   US$                     

2.

 

Net change by Change Orders (except Owner-directed Change Orders) (Section 1 of
Exhibit 1)

   US$                     

3.

 

Contract Price (Line 1 + Line 2)

   US$                     

4.

 

Total California sales and use Tax invoiced to Contractor under the Siemens
Contract (Exhibit 5)

   US$                     

5.

 

Total earned to date on Owner-directed Change Orders (Exhibit 2)

   US$                     

6

 

Total previously paid for completion of Work performed under EPC Payment
Milestones, including any Retainage paid (Exhibit 1)

   US$                     

7.

 

Total previously paid for Work performed under Siemens Equipment Payment
Milestones (Exhibit 1)

   US$                     

8.

 

Total previously paid for Work completed under Owner-directed Change Orders
(Exhibit 2)

   US$                     

9.

 

Total paid to date for California sales and use Tax invoiced to Contractor under
the Siemens Contract

   US$                     

10.

 

Total paid to date (Line 6 + Line 7 + Line 8 + Line 9)

   US$                     

11.

 

Payment Due (Line 3 + Line 4 + Line 5 - Line 10)

   US$                     

II. ADJUSTMENTS. Explanation is listed below of any adjustments required to
reconcile all previous Invoices, payments and Change Orders.

 

 

 

 

 

 

(Attach supporting documentation.)

 

Total adjustments

   US$                     

Total Final Payment Due (Line I(12) +/- total adjustment in II)

   US$                     

Contractor certifies that (i) all Work (except for that Work and obligations
that survive the termination or expiration of the Agreement) has been fully and
completely performed in accordance with the terms of the Agreement, including
the completion of all Punchlist items; (ii) prices in this final Invoice and
attached Exhibits are correct and in accordance with the Agreement; (iii) fully
completed and executed Final Waiver and Release of Liens and Final Claim Waivers
from Contractor and from all Major Subcontractors who performed Work for the
Facility, as provided in Section 7.3 of the Agreement, are attached to this
final Invoice; (iv) if requested by Owner, fully completed and executed Final
Waiver and Release of Liens and Final Claim Waivers from all Major
Sub-subcontractors who performed Work for the Facility, as provided in
Section 7.3 of the Agreement, are attached to this final Invoice; (v) all
Subcontractors have been fully paid in accordance with the terms of their
Subcontracts, except for amounts that are the subject of this final Invoice, and
attached

 

I-12

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is evidence acceptable to Owner that all Subcontractors and Sub-subcontractors
have been fully paid, less amounts that are the subject of this final Invoice;
(vi) all payrolls, Taxes, liens, charges, claims, demands, judgments, security
interests, bills for Equipment, and any other indebtedness connected with the
Work has been paid, including California state and applicable local sales and
use Taxes which Contractor is required under the Agreement to pay (including,
without limitation, any California sales and use Taxes which Contractor is
required to pay under the Siemens Contract); (vii) Contractor has delivered an
executed Final Completion Certificate, which has been accepted by Owner by
signing such certificate; (viii) Contractor has completed all other obligations
required under the Agreement for Final Completion; (ix) attached to this final
Invoice is all documentation supporting Contractor’s request for payment as
required under the Agreement; and (x) this final Invoice is signed by an
authorized representative of Contractor.

 

CONTRACTOR

       Subscribed and sworn to before me this                      day of
                    , 20    .

Signed:

 

 

       

Name:

 

 

       

Title:

 

 

    

 

  

Date:

 

 

 

, 20

 

         

     Notary Public               My Commission Expires:                     ,
20    

 

I-13

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MARSH LANDING GENERATING STATION

 

INVOICE NUMBER             

   INVOICE DATE                     , 20    

OWNER APPROVAL

AMOUNT APPROVED by Owner for Payment: US$                                

 

OWNER       

Signed:

 

 

    

Name:

 

 

    

Title:

 

 

    

Date:

 

 

 

, 20

 

         

    

The AMOUNT APPROVED by Owner is without prejudice to any rights of Owner under
the Agreement.

Explanation is listed below or attached if the AMOUNT APPROVED is less than the
amount requested by Contractor under this Invoice:

 

 

 

 

 

  .

 

I-14

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EXHIBIT 1

COMPLETION OF PAYMENT MILESTONES AND MUTUAL CHANGE ORDERS

1. MUTUAL CHANGE ORDERS: The following Change Orders have been executed by Owner
and Contractor pursuant to Section 6.1B or Section 6.2C:

 

No.

  

Description of Change Order

   US$                                    

Total

     

2. EPC PAYMENT MILESTONES: The following EPC Payment Milestones were completed
and invoiced in prior Invoices or were completed by Contractor within this
Invoice Period.

 

A

  

B

  

C

  

D

  

E

  

F

  

G

  

H

Item

No.

  

Description of EPC
Payment Milestone

  

Original EPC
Payment Milestone
Amount

  

EPC Payment
Milestone Amount as
Adjusted by Change
Order

  

EPC Payment
Milestone Amount
Previously
Invoiced*

  

EPC Payment
Milestone

Amount for this
Invoice

Period**

  

Retainage
Withheld***

  

Cumulative Amounts
Paid by Owner, or
Invoiced to Owner, for
EPC Payment
Milestones (less
Retainage Withheld)

                                                                                
                                                                                
     

Total

                    

 

*

Column E contains the full EPC Payment Milestone amount for EPC Payment
Milestones that were fully completed in accordance with the Agreement and
invoiced in prior Invoices. No partial EPC Payment Milestone amounts shall be
included, and Contractor shall not include any amounts for partially completed
EPC Payment Milestones. If amounts listed in this Column E are left blank or are
identified as “$0” (or similar indication), such identification indicates that
the

 

I-15

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applicable EPC Payment Milestone was not completed and invoiced in a prior
Invoice.

**

Column F contains the full EPC Payment Milestone amount for EPC Payment
Milestones that were fully completed in accordance with the Agreement during the
Invoice Period covered by this Invoice. No partial EPC Payment Milestone amounts
shall be included, and Contractor shall not include any amounts for partially
completed EPC Payment Milestones. If amounts listed in this Column F are left
blank or are identified as “$0” (or similar indication), such identification
indicates that the applicable EPC Payment Milestone was not completed and
invoiced in this Invoice Period.

***

Column G shall include the amount of Retainage withheld from each EPC Payment
Milestone that was previously completed and invoiced in prior Invoices or
completed and invoiced within this Invoice Period.

3. SIEMENS EQUIPMENT PAYMENT MILESTONES: The following Siemens Equipment Payment
Milestones were completed and invoiced in prior Invoices or were completed by
Contractor within this Invoice Period.

 

A

  

B

  

C

  

D

  

E

  

F

Item

No.

  

Description of Siemens Equipment
Payment Milestone

  

Original Siemens
Equipment Payment
Milestone Amount

  

Siemens Equipment
Payment Milestone
Amount as Adjusted by
Change Order

  

Siemens Equipment
Payment Milestone
Amount Previously
Invoiced*

  

Siemens Equipment
Payment Milestone
Amount for this Invoice
Period**

                                                                                
        

Total

              

 

*

Column E contains the full Siemens Equipment Payment Milestone amount for
Siemens Equipment Payment Milestones that were fully completed in accordance
with the Agreement and invoiced in prior Invoices. No partial Siemens Equipment
Payment Milestone amounts shall be included, and Contractor shall not include
any amounts for partially completed Siemens Equipment Payment Milestones. If
amounts listed in this Column E are left blank or are identified as “$0” (or
similar indication), such identification indicates that the applicable Siemens
Equipment Payment Milestone was not completed and invoiced in a prior Invoice.

**

Column F contains the full Siemens Equipment Payment Milestone amount for
Siemens Equipment Payment Milestones that were fully completed in accordance
with the Agreement during the Invoice Period covered by this Invoice. No partial
Siemens Equipment Payment Milestone amounts shall be included, and Contractor
shall not include any amounts for partially completed Siemens Equipment Payment
Milestones. If amounts listed in this Column F are left blank or are identified
as “$0” (or similar indication), such identification indicates that the
applicable Siemens Equipment Payment Milestone was not completed and is not
being invoiced in this Invoice Period.

 

I-16

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EXHIBIT 2

PAYMENTS FOR OWNER-DIRECTED CHANGE ORDERS

1. WORK COMPLETED UNDER OWNER-DIRECTED CHANGE ORDERS: The following Work has
been completed in accordance with the Agreement under Owner-directed Change
Orders on a time and material basis executed by Owner pursuant to Section 6.1C
or Section 6.2D:

 

No.

  

Description of Owner-

directed Change Order

  

Work Completed

(From Previous

Invoices) (US$)

  

Work Completed

(This Invoice

Period) (US$)*

  

Total Work

Completed (US$)

                                                           

Total

           

* The amounts in this column shall be further detailed in Section 2 below for
each Change Order.

2. CALCULATION OF TIME AND MATERIAL CHARGES FOR OWNER-DIRECTED CHANGE ORDERS:
The following table illustrates the costs incurred in performing any Change
Orders on a time and material basis for the Invoice Period covered by this
Invoice and in accordance with Section 6.3 of the Agreement.

 

A

  

B

  

C

  

D

  

E

  

F

  

G

  

H

  

I

  

J

No.

  

Description of
Owner-directed
Change Order

  

Direct Craft
Labor Costs
(US$)

  

Small Tools and
Supplies Costs
(***)

  

Construction
Equipment
Costs (US$)

  

Materials
and
Subcontracts
Costs (US$)

  

Project
Management,
Engineering
& Design
Costs (US$)

  

California
Sales and Use
Taxes (US$)

  

General and
Administrative
Expenses
(US$)

  

Profit (US$)

                                                                                
                                                     

Total

                          

The direct craft labor costs set forth in Column C above shall be itemized by
each craft laborer employed for such Work, the applicable hourly rate and the
hours expended by each laborer for each of the above Change Orders. Contractor
shall provide support for such hours and allocation to applicable Change Orders
through daily work logs, time sheets and other reasonable, objectively
verifiable supporting documentation.

 

I-17

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The total direct craft labor hours expended on the applicable Change Order (as
supported by the documentation set forth in the foregoing sentence) shall be
used to determine the small tool and supplies amount for Column D above.

The construction equipment costs for Column E and materials and subcontract
costs in Column F shall be supported by invoices, purchase orders, Contractor’s
work logs (for Contractor-owed construction equipment) and other reasonable,
objectively verifiable supporting documentation.

The project management, engineering and design costs set forth in Column G above
shall be itemized by each professional employed for such Work, the applicable
hourly rate and the hours expended by each professional for each of the above
Change Orders. Contractor shall provide support for such hours and allocation to
applicable Change Orders through daily work logs, time sheets and other
reasonable, objectively verifiable supporting documentation.

For purposes of determining the reimbursement to Contractor of California sales
and use Taxes pursuant to Section 6.3F of the Agreement, such California sales
and use Taxes to be reimbursed to Contractor (as set forth in Column H above)
shall be determined by applying the applicable sales and use tax rate to (a) the
taxable materials and subcontracts costs within the amounts set forth in Column
F and (b) any taxable third party construction equipment rental costs within the
amounts set forth in Column E incurred by Contractor.

The amounts set forth in Column I (general and administrative expenses) and
Column J (profit) shall be calculated in accordance with Sections 6.3G and 6.3H
(respectively) of the Agreement.

 

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EXHIBIT 3

FINAL WAIVER AND RELEASE OF LIENS

AND

FINAL CLAIM WAIVERS

 

I-19

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EXHIBIT 4

INFORMATION REQUIRED OR REQUESTED BY OWNER

 

I-20

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EXHIBIT 5

CALIFORNIA SALES AND USE TAX INVOICED TO CONTRACTOR

UNDER THE SIEMENS CONTRACT

 

Amount of California sales and

use Tax invoiced to Contractor

under the Siemens Contract and

requested by Contractor

 

Invoice No. and Invoice date in

which California sales and use Tax

was invoiced by Siemens to

Contractor

 

Date that such California sales

and use Tax was paid to the State

by Contractor

                                   

Total California sales and use Tax invoiced to Contractor by Siemens under the
Siemens Contract:             

 

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Execution Version

ATTACHMENT J

HEALTH, SAFETY AND ENVIRONMENTAL POLICIES

***

 

J-1

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT K

FORM OF LIEN AND CLAIM WAIVERS

 

K-1

--------------------------------------------------------------------------------

SCHEDULE K-1

CONTRACTOR’S INTERIM CONDITIONAL LIEN WAIVER AND RELEASE UPON

PROGRESS PAYMENT

(To be provided by Contractor with each invoice for progress payment)

STATE OF CALIFORNIA

COUNTY OF                     

Upon receipt by the undersigned, Kiewit Power Constructors Co. (“Contractor”),
of payment from Mirant Marsh Landing, LLC (“Owner”) in the sum of
$                    , this document shall become effective to release any
mechanic’s lien, stop notice, or bond right the undersigned has on the job of
Owner located at the Marsh Landing electric generation facility near Antioch,
California to the following extent. This release covers a progress payment for
labor, services, equipment, or material furnished to Owner through
                     (Date) only and does not cover any retentions retained
before or after the release date; extras furnished before the release date for
which payment has not been received; extras or items furnished after the release
date. Rights based upon work performed or items furnished under a written change
order which has been fully executed by the parties prior to the release date are
covered by this release unless specifically reserved by the claimant in this
release. This release of any mechanic’s lien, stop notice, or bond right shall
not otherwise affect the contract rights, including rights between parties to
the contract based upon a rescission, abandonment, or breach of the contract, or
the right of the undersigned to recover compensation for furnished labor,
services, equipment, or material covered by this release if that furnished
labor, services, equipment, or material was not compensated by the progress
payment. Before any recipient of this document relies on it, said party should
verify evidence of payment to the undersigned.

Contractor agrees that this waiver and release form is in compliance with Cal.
Civ. Code § 3262(d).

FOR CONTRACTOR:

 

Dated:                     

 

Kiewit Power Constructors Co.

Applicable to Invoice No.                     

 

By

 

 

 

Print Name:

 

 

 

Title:

 

 

 

K-2

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SCHEDULE K-2

CONTRACTOR’S INTERIM CLAIM WAIVER AND RELEASE

UPON PROGRESS PAYMENT

(To be provided by Contractor with each invoice for progress payment)

STATE OF CALIFORNIA

COUNTY OF                     

The undersigned, Kiewit Power Constructors Co. (“Contractor”), has been engaged
under a contract with Mirant Marsh Landing, LLC (“Owner”) to furnish certain
materials, equipment, services, and/or labor for the construction of
improvements to the Marsh Landing electric generation facility, together with
all improvements and appurtenances attendant thereto (the “Facility”), which is
located near the City of Antioch, State of California, and more particularly
described as follows:

 

 

 

 

Upon receipt of the sum of $                    , Contractor waives and releases
any and all claims, demands, actions, causes of action or other rights (except
those concerning lien, stop notice or bond rights which are separately waived
pursuant to Cal. Civ. Code § 3262(d) by the Contractor’s Interim Conditional
Lien Waiver and Release Upon Progress Payment, which is executed concurrently
with this form) against Owner through the date of                     , 20    
and reserving those rights that Contractor might have in any retained amounts,
on account of materials, equipment, services and/or labor furnished by the
undersigned to or on account of Owner or any other entity for said Facility.
Exceptions as follows:

 

 

(If no exception or “none” is entered above, undersigned shall be deemed not to
have reserved any claim.)

Contractor affirms and represents that all subconsultants, laborers,
materialmen, mechanics, manufacturers, suppliers, and subcontractors who have
furnished services, labor, equipment, or materials, or any one of these items to
Contractor have been paid in full for all work performed and all materials,
equipment, labor or services supplied to Contractor for use at the Facility
through and including                     , 20     (date of Contractor’s last
prior invoice), and (b) that Contractor is not indebted to any person or entity
for labor, equipment, services or materials used in connection with or as a part
of such Facility in any amount whatsoever through and including the date hereof,
excepting amounts for retainage and amounts, if any, reasonably disputed between
Contractor and such person or entity, as follows:

 

 

(If no exception or “none” is entered above, no amounts have been withheld by
Contractor for disputed items.)

This Waiver and Release is freely and voluntarily given and the undersigned
acknowledges and represents that it has fully reviewed the terms and conditions
of this Waiver and Release, that it is fully informed with respect to the legal
effect of this Waiver and Release, and that it has voluntary chosen to accept
the terms and conditions of this Waiver and Release in return for the payment
recited above.

 

FOR CONTRACTOR:

Applicable to invoice no(s).

 

 

Signed:

 

 

By:

 

 

Title:

 

 

Date:

 

 

 

K-3

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SCHEDULE K-3

SUBCONTRACTOR’S INTERIM CONDITIONAL LIEN WAIVER AND RELEASE

UPON PROGRESS PAYMENT

(To be provided by Subcontractor with each invoice for progress payment)

STATE OF CALIFORNIA

COUNTY OF                     

Upon receipt by the undersigned,                      (“Subcontractor”), of
payment from Kiewit Power Constructors Co. (“Contractor”) in the sum of
$                    , this document shall become effective to release any
mechanic’s lien, stop notice, or bond right the undersigned has on the job of
Mirant Marsh Landing, LLC (“Owner”) located at the Marsh Landing electric
generation facility near Antioch, California to the following extent. This
release covers a progress payment for labor, services, equipment, or material
furnished to Contractor through                     (Date) only and does not
cover any retentions retained before or after the release date; extras furnished
before the release date for which payment has not been received; extras or items
furnished after the release date. Rights based upon work performed or items
furnished under a written change order which has been fully executed by the
parties prior to the release date are covered by this release unless
specifically reserved by the claimant in this release. This release of any
mechanic’s lien, stop notice, or bond right shall not otherwise affect the
contract rights, including rights between parties to the contract based upon a
rescission, abandonment, or breach of the contract, or the right of the
undersigned to recover compensation for furnished labor, services, equipment, or
material covered by this release if that furnished labor, services, equipment,
or material was not compensated by the progress payment. Before any recipient of
this document relies on it, said party should verify evidence of payment to the
undersigned.

Subcontractor agrees that this waiver and release form is in compliance with
Cal. Civ. Code § 3262(d).

FOR SUBCONTRACTOR:

 

Dated:                     

 

 

 

Applicable to Invoice No.                     

 

By

 

 

 

Print Name:

 

 

 

Title:

 

 

 

K-4

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SCHEDULE K-4

SUBCONTRACTOR’S INTERIM CLAIM WAIVER AND

RELEASE UPON PROGRESS PAYMENT

(To be provided by Subcontractor with each invoice for progress payment)

STATE OF CALIFORNIA

COUNTY OF                     

The undersigned,                      (“Subcontractor”), has been engaged under
a contract with Kiewit Power Constructors Co. (“Contractor”) to furnish certain
materials, equipment, services, and/or labor for the construction of
improvements to the Marsh Landing electric generation facility, together with
all improvements and appurtenances attendant thereto (the “Facility”), which is
located near the City of Antioch, State of California, and more particularly
described as follows:

 

 

 

 

Upon receipt of the sum of $                    , the Subcontractor waives and
releases any and all claims, demands, actions, causes of action or other rights
(except those concerning lien, stop notice or bond rights which are separately
waived pursuant to Cal. Civ. Code § 3262(d) by the Subcontractor’s Interim
Conditional Lien Waiver and Release Upon Progress Payment, which is executed
concurrently with this form) against Mirant Marsh Landing, LLC (“Owner”) through
the date of                     , 20     and reserving those rights that the
Subcontractor might have in any retained amounts, on account of materials,
equipment, services and/or labor furnished by the undersigned to or on account
of Owner or any other entity for said Facility. Exceptions as follows:

 

 

(If no exception or “none” is entered above, undersigned shall be deemed not to
have reserved any claim.)

Subcontractor affirms and represents that all subconsultants, laborers,
materialmen, mechanics, manufacturers, suppliers, and subcontractors who have
furnished services, labor, equipment, or materials, or any one of these items to
the Subcontractor have been paid in full for all work performed and all
materials, equipment, labor or services supplied to the Subcontractor for use at
the Facility through and including                     , 20     (date of
Subcontractor’s last prior invoice), and (b) that the Subcontractor is not
indebted to any person or entity for labor, equipment, services or materials
used in connection with or as a part of such Facility in any amount whatsoever
through and including the date hereof, excepting amounts for retainage.

This Waiver and Release is freely and voluntarily given and the undersigned
acknowledges and represents that it has fully reviewed the terms and conditions
of this Waiver and Release, that it is fully informed with respect to the legal
effect of this Waiver and Release, and that it has voluntary chosen to accept
the terms and conditions of this Waiver and Release in return for the payment
recited above.

 

FOR SUBCONTRACTOR:

Applicable to invoice no(s).

 

 

Signed:

 

 

By:

 

 

Title:

 

 

Date:

 

 

 

K-5

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SCHEDULE K-5

CONTRACTOR’S FINAL CONDITIONAL LIEN WAIVER AND RELEASE UPON

FINAL PAYMENT

(To be provided by Contractor with the invoice for final payment)

STATE OF CALIFORNIA

COUNTY OF                     

Upon receipt by the undersigned, Kiewit Power Constructors Co. (“Contractor”),
of payment from Mirant Marsh Landing, LLC (“Owner”) in the sum of
$                    , this document shall become effective to release any
mechanic’s lien, stop notice, or bond right the undersigned has on the job of
Owner located at the Marsh Landing electric generation facility near Antioch,
California. This release covers the final payment to the undersigned Contractor
for all labor, services, equipment, or material furnished on the job, except for
disputed claims for additional work in the amount of $                    .
Before any recipient of this document relies on it, the party should verify
evidence of payment to the undersigned.

Contractor agrees that this waiver and release form is in compliance with Cal.
Civ. Code § 3262(d).

FOR CONTRACTOR:

 

Dated:                     

 

Kiewit Power Constructors Co.

Applicable to Invoice No.                     

 

By

 

 

 

Print Name:

 

 

 

Title:

 

 

AFFIDAVIT

On this      day of                     , 20    , before me appeared the
above-signed, known or identified to me personally, who, being first duly sworn,
did say that s/he is the authorized representative of Contractor and that this
document was signed under oath personally and on behalf of Contractor.

 

 

Notary Public

My term expires (date):                    

 

K-6

--------------------------------------------------------------------------------

SCHEDULE K-6

CONTRACTOR’S FINAL CLAIM WAIVER AND RELEASE UPON FINAL PAYMENT

(To be executed by Contractor with the invoice for final payment)

STATE OF CALIFORNIA

COUNTY OF                     

The undersigned, Kiewit Power Constructors Co. (“Contractor”), has been engaged
under a contract with Mirant Marsh Landing, LLC (“Owner”) to furnish certain
materials, equipment, services, and/or labor for the construction of
improvements to the Marsh Landing electric generation facility, together with
all improvements and appurtenances attendant thereto (the “Facility”), which is
located near the City of Antioch, State of California, and more particularly
described as follows:

Upon receipt of the sum of U.S. $                    (amount in invoice for
final payment), Contractor waives and releases all claims, demands, actions,
causes of actions or other rights at law, in contract, tort, equity or otherwise
(except those concerning lien, stop notice or bond rights which are separately
waived pursuant to Cal. Civ. Code § 3262(d) by the Contractor’s Final
Conditional Lien Waiver and Release Upon Final Payment, which is executed
concurrently with this form) that Contractor has, may have had or may have in
the future against Owner arising out of the contract with Owner. This
Contractor’s Waiver and Release applies to all facts, acts, events,
circumstances, changes, constructive or actual delays, accelerations, extra
work, disruptions, interferences and the like which have occurred, or may be
claimed to have occurred prior to the date of this Waiver and Release, whether
or not known to Contractor at the time of the execution of this Waiver and
Release.

Contractor represents that all of its obligations, legal, equitable, or
otherwise, relating to or arising out of its work on the Facility have been
fully satisfied (except for that work and obligations that survive the
termination or expiration of the contract, including warranties and correction
of defective work), including, but not limited to, payment to subcontractors and
employees and payment of taxes.

This Waiver and Release is freely and voluntarily given, and Contractor
acknowledges and represents that it has fully reviewed the terms and conditions
of this Waiver and Release, that it is fully informed with respect to the legal
effect of this Waiver and Release, and that it has voluntarily chosen to accept
the terms and conditions of this Waiver and Release in return for the payment
recited above. Contractor understands, agrees and acknowledges that, upon
payment, this document waives rights unconditionally and is fully enforceable to
extinguish all claims (except those concerning lien, stop notice or bond rights
which are separately waived pursuant to Cal. Civ. Code § 3262(d) by the
Contractor’s Final Conditional Lien Waiver and Release Upon Final Payment, which
is executed concurrently with this form) of Contractor as of the date of
execution of this document by Contractor.

 

FOR CONTRACTOR:

Applicable to Invoice No(s):         ALL        

Signed:

 

 

By:

 

 

Title:

 

 

Date:

 

 

 

K-7

--------------------------------------------------------------------------------

AFFIDAVIT

On this      day of                     , 20    , before me appeared the
above-signed, known or identified to me personally, who, being first duly sworn,
did say that s/he is the authorized representative of Contractor and that this
document was signed under oath personally and on behalf of Contractor.

 

 

Notary Public

My term expires (date):                    

 

K-8

--------------------------------------------------------------------------------

SCHEDULE K-7

SUBCONTRACTOR’S FINAL CONDITIONAL LIEN WAIVER AND RELEASE UPON

FINAL PAYMENT

(To be provided by Subcontractor with the invoice for final payment)

STATE OF CALIFORNIA

COUNTY OF                     

Upon receipt by the undersigned,                      (“Subcontractor”), of
payment from Kiewit Power Constructors Co. (“Contractor”) in the sum of
$                    , this document shall become effective to release any
mechanic’s lien, stop notice, or bond right the undersigned has on the job of
Mirant Marsh Landing, LLC (“Owner”) located at the Marsh Landing electric
generation facility near Antioch, California. This release covers the final
payment to the undersigned Subcontractor for all labor, services, equipment, or
material furnished on the job, except for disputed claims for additional work in
the amount of $                    . Before any recipient of this document
relies on it, the party should verify evidence of payment to the undersigned.

Subcontractor agrees that this waiver and release form is in compliance with
Cal. Civ. Code § 3262(d).

FOR SUBCONTRACTOR:

 

Dated:                     

 

 

 

Applicable to Invoice No.                     

 

By

 

 

 

Print Name:

 

 

 

Title:

 

 

AFFIDAVIT

On this      day of                     , 20    , before me appeared the
above-signed, known or identified to me personally, who, being first duly sworn,
did say that s/he is the authorized representative of Subcontractor and that
this document was signed under oath personally and on behalf of Subcontractor.

 

 

Notary Public

My term expires (date):                    

 

K-9

--------------------------------------------------------------------------------

SCHEDULE K-8

SUBCONTRACTOR’S FINAL CLAIM WAIVER AND RELEASE UPON

FINAL PAYMENT

(To be executed by Subcontractor with the invoice for final payment)

STATE OF CALIFORNIA

COUNTY OF                     

The undersigned,                      (“Subcontractor”), has been engaged under
a contract with Kiewit Power Constructors Co. (“Contractor”) to furnish certain
materials, equipment, services, and/or labor for the construction of
improvements to the Marsh Landing electric generation facility, together with
all improvements and appurtenances attendant thereto (the “Facility”), which is
located near the City of Antioch, State of California, and more particularly
described as follows:

 

 

 

 

Upon receipt of the sum of U.S.$                     (amount in invoice for
final payment), Subcontractor waives and releases all claims, demands, actions,
causes of actions or other rights at law, in contract, tort, equity or otherwise
(except those concerning lien, stop notice or bond rights which are separately
waived pursuant to Cal. Civ. Code § 3262(d) by the Subcontractor’s Final
Conditional Lien Waiver and Release Upon Final Payment, which is executed
concurrently with this form) that Subcontractor has, may have had or may have in
the future against Mirant Marsh Landing, LLC (“Owner”) arising out of, or in any
way related to, Subcontractor’s subcontract with Contractor or the Facility.
This Subcontractor’s Waiver and Release applies to all facts, acts, events,
circumstances, changes, constructive or actual delays, accelerations, extra
work, disruptions, interferences and the like which have occurred, or may be
claimed to have occurred prior to the date of this Waiver and Release, whether
or not known to Subcontractor at the time of the execution of this Waiver and
Release.

Subcontractor represents that all of its obligations, legal, equitable, or
otherwise, relating to or arising out of its work on the Facility have been
fully satisfied, including, but not limited to, payment to lower tiered
subcontractors and employees and payment of taxes.

This Waiver and Release is freely and voluntarily given, and Subcontractor
acknowledges and represents that it has fully reviewed the terms and conditions
of this Waiver and Release, that it is fully informed with respect to the legal
effect of this Waiver and Release, and that it has voluntarily chosen to accept
the terms and conditions of this Waiver and Release in return for the payment
recited above. Subcontractor understands, agrees and acknowledges that, upon
payment, this document waives rights unconditionally and is fully enforceable to
extinguish all claims (except those concerning lien, stop notice or bond rights
which are separately waived pursuant to Cal. Civ. Code § 3262(d) by the
Subcontractor’s Final Conditional Lien Waiver and Release Upon Final Payment,
which is executed concurrently with this form) of Subcontractor as of the date
of execution of this document by Subcontractor.

 

FOR SUBCONTRACTOR:

Applicable to Invoice No(s):        ALL        

Signed:

 

 

By:

 

 

Title:

 

 

Date:

 

 

 

K-10

--------------------------------------------------------------------------------

AFFIDAVIT

On this      day of                     , 20    , before me appeared the
above-signed, known or identified to me personally, who, being first duly sworn,
did say that s/he is the authorized representative of Subcontractor and that
this document was signed under oath personally and on behalf of Subcontractor.

 

 

Notary Public

My term expires (date):                    

 

K-11

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT L

FORM OF MECHANICAL COMPLETION CERTIFICATE

Mirant Marsh Landing, LLC

c/o Mirant Corporation

1155 Perimeter Center West

Atlanta, Georgia 30338

Attention: Mike Ammer

 

Re:

  

Mechanical Completion Certificate for                      (insert applicable
system or subsystem) – The Lump Sum Turnkey Agreement for the Engineering,
Procurement and Construction of the Marsh Landing Generating Station dated as of
[            , 20    ] (the “Agreement”), by and between Mirant Marsh Landing,
LLC (“Owner”) and Kiewit Power Constructors Co. (“Contractor”)

Pursuant to Section 12.1B of Agreement, Contractor hereby certifies that it has
completed all requirements under the Agreement for Mechanical Completion with
respect to                      (insert applicable system or subsystem), and
that, with the exception of Punchlist items, all of the following have occurred:
(i) Contractor has completed all procurement, fabrication, assembly, erection
and installation and pre-commissioning checks and tests for such system or
subsystem (as further described in the Scope of Work) to ensure that the
applicable system or subsystem (including all Equipment related to such system
or subsystem) was correctly fabricated, assembled, erected and installed and is
capable of being operated safely and reliably within the requirements and
specifications contained in the Agreement, including the setting of such
Equipment on foundations, connecting such Equipment to other applicable
Equipment with piping, wiring, controls, and safety systems, ensuring that such
Equipment and such related operating systems are individually cleaned, leak
checked, lubricated, and point-to-point checked to verify that such Equipment
and operating systems have been correctly installed so as to respond to
simulated test signals equivalent to actual signals received during operation,
and are ready for initial operation, adjustment and testing and may be so
operated, adjusted and tested without damage thereto or to any other property
and without injury to any Person, all as set forth in greater detail in
Attachments A and V and the Mechanical Completion checklists agreed by Owner and
Contractor in accordance with Section 12.1B of the Agreement; (ii) Contractor
has completed the Work, to the extent necessary, to cause such system or
subsystem to be capable of operating safely in accordance with Applicable Laws,
prudent utility practices, and GECP for further commissioning and testing; (iii)
Contractor has submitted to Owner an initial Punchlist of items as set forth in
Section 12.5A of the Agreement; (iv) Contractor hereby delivers to Owner this
Mechanical Completion Certificate; and (v) Contractor has performed all other
obligations required under the Agreement for Mechanical Completion.

Contractor certifies that all requirements under the Agreement for Mechanical
Completion with respect to                      (insert applicable system or
subsystem) were achieved on             , 20    .

Attached is all documentation required to be provided by Contractor under the
Agreement to establish that all requirements under the Agreement for Mechanical
Completion of the applicable system or subsystem have been achieved.

IN WITNESS WHEREOF, Contractor has caused this Mechanical Completion Certificate
to be duly executed and delivered as of the date first written above.

 

KIEWIT POWER CONSTRUCTORS CO.

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

cc:                             

 

L-1

--------------------------------------------------------------------------------

Owner Acceptance or Rejection of Mechanical Completion Certificate

Pursuant to Section 12.3 of the Agreement, Owner                      accepts or
                     rejects (check one) the Mechanical Completion Certificate
for                      (insert applicable system or subsystem)

If Mechanical Completion with respect to                      (insert applicable
system or subsystem) was achieved, Mechanical Completion was achieved on
            , 200    .

Acceptance of this Mechanical Completion Certificate shall not relieve
Contractor of any of Contractor’s obligations to perform the Work in accordance
with the requirements of the Agreement, nor shall it in any way release
Contractor or any surety of Contractor from any obligations or liability
pursuant to the Agreement, including obligations with respect to unperformed
obligations of the Agreement or for any Work that does not conform to the
requirements of the Agreement.

The basis for any rejection of Mechanical Completion is attached hereto.

 

For and on behalf of

MIRANT MARSH LANDING, LLC

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

 

L-2

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT M

FORM OF SUBSTANTIAL COMPLETION CERTIFICATE

Mirant Marsh Landing, LLC

c/o Mirant Corporation

1155 Perimeter Center West

Atlanta, Georgia 30338

Attention: Mike Ammer

 

Re:

  

Substantial Completion Certificate – The Lump Sum Turnkey Agreement for the
Engineering, Procurement and Construction of the Marsh Landing Generating
Station dated as of [            , 20    ] (the “Agreement”), by and between
Mirant Marsh Landing, LLC (“Owner”) and Kiewit Power Constructors Co.
(“Contractor”)

Pursuant to Section 12.2 of Agreement, Contractor hereby certifies that it has
completed all requirements under the Agreement for Substantial Completion with
respect to the Facility, as follows: (i) Mechanical Completion of the Facility;
(ii) all Minimum Acceptance Criteria have been achieved; (iii) Contractor and
Owner have agreed upon a revised and updated Punchlist of items as set forth in
Section 12.5B of the Agreement; (iv) all Work has been completed (including
training and the delivery of all documentation, manuals and instruction books
necessary for safe and proper operation), except for Work on the Punchlist and
the Final Completion requirements identified in clauses (ii) through (xii) of
the definition of Final Completion set forth in this Article 1, in accordance
with the requirements and specifications of this Agreement; (v) Contractor
hereby delivers to Owner this Substantial Completion Certificate; (vi) the
Facility is available for commercial operation and can be safely used for its
intended purpose and all four (4) Units and all related systems can be safely
and reliably operated within the requirements and specifications of the
Agreement in order to deliver electrical output in accordance with the
requirements and specifications of the Agreement; (vii) Contractor has obtained
all Permits for the Facility that it is obligated to obtain under this
Agreement; (viii) certificates of occupancy for all applicable buildings at the
Facility have been issued; (ix) Contractor has assigned to or provided Owner
with all Warranties to the extent Contractor is obligated to do so pursuant to
this Agreement (including Section 13.1C of the Agreement); and (x) Contractor
has performed all other obligations required under this Agreement for
Substantial Completion.

Contractor certifies that it achieved all requirements under the Agreement for
Substantial Completion on                     , 20    .

Attached is all documentation required to be provided by Contractor under the
Agreement to establish that Contractor has achieved all requirements under the
Agreement for Substantial Completion, including all test reports.

IN WITNESS WHEREOF, Contractor has caused this Substantial Completion
Certificate to be duly executed and delivered as of the date first written
above.

 

KIEWIT POWER CONSTRUCTORS CO.

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

cc:                             

 

M-1

--------------------------------------------------------------------------------

Owner Acceptance or Rejection of Substantial Completion Certificate

Pursuant to Section 12.3 of the Agreement, Owner                      accepts or
                     rejects (check one) the Substantial Completion Certificate.

If Substantial Completion was achieved, Substantial Completion was achieved on
            , 20    .

Acceptance of this Substantial Completion Certificate shall not relieve
Contractor of any of Contractor’s obligations to perform the Work in accordance
with the requirements of the Agreement, nor shall it in any way release
Contractor or any surety of Contractor from any obligations or liability
pursuant to the Agreement, including obligations with respect to unperformed
obligations of the Agreement or for any Work that does not conform to the
requirements of the Agreement.

The basis for any rejection of Substantial Completion is attached hereto.

 

For and on behalf of

MIRANT MARSH LANDING, LLC

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

 

M-2

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT N

FORM OF FINAL COMPLETION CERTIFICATE

Mirant Marsh Landing, LLC

c/o Mirant Corporation

1155 Perimeter Center West

Atlanta, Georgia 30338

Attention: Mike Ammer

 

Re:

  

Final Completion Certificate – The Lump Sum Turnkey Agreement for the
Engineering, Procurement and Construction of the Marsh Landing Generating
Station dated as of [            , 20    ] (the “Agreement”), by and between
Mirant Marsh Landing, LLC (“Owner”) and Kiewit Power Constructors Co.
(“Contractor”)

Pursuant to Section 12.6 of Agreement, Contractor hereby certifies that all Work
and all other obligations under the Agreement (except for that Work and
obligations that survive the termination or expiration of the Agreement,
including obligations for Warranties and correction of Defective Work) are fully
and completely performed in accordance with the terms of the Agreement,
including: (i) the successful achievement of Mechanical Completion and
Substantial Completion; (ii) the completion of all Punchlist items; (iii)
delivery by Contractor to Owner of Contractor’s fully executed Final Waiver and
Release of Liens in the form of Schedule K-5 and Final Claim Waiver in the form
of Schedule K-6; (iv) delivery by Contractor to Owner of all documentation
required to be delivered under this Agreement, including Record As-Built
Drawings and Specifications, Owner’s Confidential Information and the final
operating and maintenance manuals for the Facility; (v) delivery to Owner, in
content and form reasonably satisfactory to Owner, copies of all required
Subcontracts, written assignments of Subcontractor warranties and a list of the
names, addresses and telephone numbers of the Subcontractors providing such
warranties; (vi) removal from the Site of all of Contractor’s, Subcontractors’
and Sub-subcontractor’s personnel, supplies, waste, materials, equipment (except
Equipment), rubbish, Hazardous Materials, and temporary facilities; (vii)
delivery by Contractor to Owner of evidence acceptable to Owner that all Major
Subcontractors and Sub-subcontractors have been fully and finally paid,
including fully executed Final Waiver and Release of Liens in the form of
Schedule K-7 and Final Claim Waivers in the form of Schedule K-8 from all Major
Subcontractors; (viii) if requested by Owner, fully executed Final Waiver and
Release of Liens from Major Sub-subcontractors in a form substantially similar
to the form in Schedule K-7 and fully executed Final Claim Waivers from Major
Sub-subcontractors in a form substantially similar to the form in Schedule K-8;
(ix) achievement of all Performance Guarantees, or if all Performance Guarantees
are not achieved, the payment of all applicable Performance Liquidated Damages;
(x) achievement of the Starting Reliability Requirement; (xi) delivery to Owner
of all specialty tools required for the operation and maintenance of the
Facility and the operating spare parts (if any) required to be provided to Owner
under this Agreement (other than those operating spare parts for the Siemens
Equipment which are provided by Contractor pursuant to Section 3.4C of the
Agreement); (xii) Contractor hereby delivers to Owner this Final Completion
Certificate; and (xiii) performance by Contractor of all other obligations
required under this Agreement for Final Completion.

Contractor certifies that all requirements under the Agreement for Final
Completion were achieved on             , 20    .

Attached is all documentation required to be provided by Contractor under the
Agreement to establish that all requirements under the Agreement for Final
Completion have been achieved.

 

N-1

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IN WITNESS WHEREOF, Contractor has caused this Final Completion Certificate to
be duly executed and delivered as of the date first written above.

 

KIEWIT POWER CONSTRUCTORS CO.

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

cc:                             

 

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Owner Acceptance or Rejection of Final Completion Certificate

Pursuant to Section 12.6 of the Agreement, Owner                      accepts or
             rejects (check one) the Final Completion Certificate.

If Final Completion was achieved, Final Completion was achieved on             ,
20    .

Acceptance of this Final Completion Certificate shall not relieve Contractor of
any of Contractor’s obligations to perform the Work in accordance with the
requirements of the Agreement, nor shall it in any way release Contractor or any
surety of Contractor from any obligations or liability pursuant to the
Agreement, including obligations with respect to unperformed obligations of the
Agreement or for any Work that does not conform to the requirements of this
Agreement, including Warranty obligations.

The basis for any rejection of Final Completion is attached hereto.

 

For and on behalf of

MIRANT MARSH LANDING, LLC

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

 

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Execution Version

ATTACHMENT O

INSURANCE REQUIREMENTS

 

1.

Contractor’s Insurance. Prior to commencement of the Work, Contractor shall
provide and maintain at its own cost and expense the following insurance
coverages and limits until the earlier of Final Completion or termination of
this Agreement, except for Products and Completed Operations coverage as
described in the Sections below. The limits of coverage required by the
Agreement may be satisfied by a combination of primary and excess (or umbrella)
insurance policies provided that the form of the excess/umbrella coverage
follows the form of the primary liability insurance. All insurance obtained by
Contractor hereunder shall be written by a company or companies with a Best’s
rating of no less than A minus: VII or equivalent and shall be written on an
occurrence basis. Such company or companies must be lawfully authorized to do
business in the jurisdiction in which the Project is located and/or where any
services related to the Agreement are performed

 

  1.1.

Commercial General Liability Insurance.

 

  1.1.1.

Commercial General Liability Insurance providing coverage of *** as will protect
Contractor and its respective employees, representatives and agents from third
party bodily injury (including death) and property damage claims which may arise
out of or result from the operations of Contractor under the Agreement. The
policy limits shall apply on a per project basis.

 

  1.1.2.

The Liability insurance in this Section 1.1 shall be written on an occurrence
form and include Comprehensive Form, Premises and Operations, Independent
Contractors, Products and Completed Operations, Blanket Written Contractual,
Broad Form Property Damage, Explosion, Collapse and Underground Hazard (XCU
coverage), and Personal Injury liability coverages. A cross liability and
severability of interest clause shall be included. Blanket Contractual Liability
Insurance shall specifically include Contractor’s indemnification obligations
under the Agreement for personal and bodily injury (including death) and
property damage, and shall provide that any defense costs are included within
the coverage.

 

  1.1.3.

Products and Completed Operations required in this Section 1.1 shall continue
for a period of *** after the earlier of Substantial Completion of the Facility
and termination of the Agreement.

 

  1.2.

Business Automobile Liability Insurance. Business Automobile Liability
Insurance, including coverage for the operation of all owned, non-owned and
hired vehicles (coverage code 1 – “any auto”) including trailers with limits of
liability for bodily injury (including death) and property damage of *** for
each accident. Coverage shall be as broad as the ISO Business Automobile
Coverage Form. If scope of Work involves hauling hazardous materials, coverage
shall be endorsed or be required of a hauling contractor in accordance with
Section 30 of the Motor Carrier Act of 1980 (Category 2) and the CA 99 48
endorsement.

 

  1.3.

Workers’ Compensation and Employers’ Liability Insurance. Workers’ Compensation
Insurance or its substantial equivalent on its employees for statutory
obligations imposed by Workers’ Compensation or Occupational Disease laws and
regulations of the applicable

 

O-1

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jurisdiction, including coverage for the benefits provided under the United
States Longshoremen & Harbor Workers’ Act, the Jones Act and other appropriate
extensions, with Employer’s Liability Insurance (Coverage B) including Maritime,
to limits of *** each accident. Coverage under the Broad Form All States
extension shall be included. For comparable exposures falling outside of the
United States, Contractor shall comply with all legally required obligations
related to employee injuries, including obligations related to compensation for
medical costs and/or lost wages.

 

  1.4.

Aircraft Liability Insurance. Should aircraft be utilized under the Agreement,
Aircraft Liability Insurance, including coverage for the operation of all owned,
non-owned and hired aircraft with limits of liability for bodily injury and
property damage of ***. Such insurance shall cover occurrences at and away from
the Site.

 

  1.5.

Watercraft Liability Insurance. Should watercraft be utilized under the
Agreement, Watercraft Liability Insurance, including coverage for the operation
of all owned, non-owned and hired watercraft with limits of liability for bodily
injury and property damage of ***. Such insurance shall cover occurrences at and
away from the Site.

 

  1.6.

Contractor’s Pollution Liability. Contractor’s Pollution Liability providing
coverage of *** for:

 

  1.6.1.

bodily injury, sickness, disease, mental anguish or shock sustained by any
Person, including death;

 

  1.6.2.

property damage including physical injury to or destruction of tangible property
including the resulting loss of use thereof, clean up costs, and the loss of use
of tangible property that has not been physically injured or destroyed; and

 

  1.6.3.

defense including loss adjustment costs, charges and expenses incurred in the
investigation, adjustment or defense of claims for such compensatory damages.

 

  1.7.

Excess Liability Insurance. Umbrella Excess Liability Insurance with a limit of
not less than *** and shall provide excess coverage and is to follow form of the
primary Commercial General Liability, Business Automobile Liability, Employers’
Liability, Aircraft Liability (if applicable), and Watercraft Liability (if
applicable). The policy limits shall apply on a per project basis.

 

  1.8.

Other Insurance.

 

  1.8.1.

International Insurance. Additional insurance may be required in accordance with
the customs of the country where any part of the operation of the Agreement will
occur.

 

  1.8.2.

Difference in Conditions Policy. If insurance under Section 1.8.1 is obtained, a
Difference in Conditions Policy with the applicable limit required in Section
1.1 through 1.7 above shall be procured to complete gaps left by the local
policy that are customarily included in a policy issued in the United States.

 

  1.9.

General Insurance Conditions. Other than (i) coverage under the builder’s risk
insurance to be procured by Owner pursuant to Section 2.1 in this Attachment O
and (ii) coverage under the marine cargo insurance (excluding coverage for the
Siemens Equipment) to be procured

 

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by Owner pursuant to Section 2.2 in this Attachment O, all coverages provided by
Contractor shall be primary coverage for incidents arising from the Work or
otherwise under the Agreement and pay without contribution for any other
coverage procured or maintained by Owner, its Affiliates and/or its Lender(s)
regardless of whether or not Owner has similar coverage. Contractor shall bear
all cost for payment of any and all deductibles or self-insured retentions under
its policies and shall remain solely and fully liable for the full amount of any
claim or item not compensated by insurance. Contractor’s deductible shall
encompass the costs of defense, including court costs and attorneys fees. All
insurance coverage required to be carried by Contractor under the Agreement
(except workers’ compensation/employer’s liability insurance) shall be endorsed
to name the Owner Group as additional insured and other parties reasonably
requested by Owner for their imputed liability as a result of Contractor’s
operations hereunder. Unless prohibited by Applicable Law, Contractor shall
waive and will require its insurers to waive any right of recovery, under
subrogation or otherwise, against the Owner Group.

 

  1.10.

Other Duties, Representations, and Obligations.

 

  1.10.1.

Certificates of Insurance. Certificates of Insurance will be provided by
Contractor on an industry standard ACORD Form 25 and shall be filed with Owner
prior to commencement of the Work. These Certificates and the insurance policies
required by the Agreement shall contain a provision that the coverages afforded
under Contractor’s policies shall not be canceled without first giving at least
sixty (60) Days prior written notice thereof to Owner. No such cancellation
shall affect Contractor’s obligation to maintain the insurance coverages
required by the Agreement. Upon expiration of all required policies, renewal
certificates shall be sent to Owner for verification of continued compliance of
Contractor’s insurance requirements under the Agreement. Without relieving
Contractor of any obligations to maintain the insurance required herein,
Contractor shall give Owner prompt notice of any modification or change to the
limits of any policy required herein.

 

  1.10.2.

Violation of Insurance Terms. Contractor shall not violate or knowingly permit
any violation of any conditions or terms of the policies of insurance required
by the Agreement.

 

  1.10.3.

Failure to Maintain Insurance. In the event Contractor neglects, refuses or
fails to provide or maintain any of the insurance required under the Agreement
or if such insurance is cancelled for any reason, Owner shall have the right,
but not the obligation, to procure or maintain the same. In the event Owner does
procure or maintain such insurance, Owner shall have, in addition to any and all
other available remedies, the right to recover from Contractor all of the costs
associated with procuring or maintaining such insurance.

 

  1.10.4.

No Waiver of Liability. The foregoing provisions requiring Contractor to carry
insurance shall not be construed in any manner as waiving, restricting or
limiting the liability of Contractor as to any obligations imposed under
Agreement, whether or not same are, or may be, covered by insurance. In
addition, the maintenance of Contractor’s insurance shall not in any way operate
to limit the liability of Contractor to Owner under the Agreement.

 

O-3

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  1.10.5.

Additional Insurance. Upon a reasonable written request from Owner, Contractor
shall provide as soon as practicable additional insurance, including increased
coverage and/or limits of liability, as Owner deems appropriate for the risk
involved, and Owner will pay Contractor the additional actual premium cost
thereof by Change Order. In addition, Contractor agrees to cooperate with Owner
as to any changes or additions to the insurance required to be provided by
Contractor under the Agreement, which are made necessary by requirements imposed
by the Lender(s), provided that any additional, actual premium cost resulting
from such Lender’s requirements shall be paid by Owner to Contractor by Change
Order.

 

  1.10.6.

Premium Audit. With respect to any special policies or additional limits
procured as a result of the Agreement, Contractor herby grants permission to
Owner, or Owner’s representative, to audit any request for premium reimbursement
including permission for Owner to contact and receive its broker’s
certification.

 

  1.10.7.

Contractor’s Property. In accordance with Section 3.7 of the Agreement,
Contractor shall be responsible for and shall bear the risk of loss and damage
to any (i) construction tools and equipment of Contractor (owned or rented) and
(ii) any property (other than the Work) for which it is responsible or that is
in its care, custody and control, wherever located. Any insurance provided for
such construction tools and equipment and such other property shall be at
Contractor’s expense and shall otherwise comply with the requirements of this
Attachment O. All deductibles with respect to the Contractor’s insurance shall
be for the account of Contractor.

 

  1.11.

Subcontractor’s Insurance.

 

  1.11.1.

Levels of Coverage. Contractor shall require all Subcontractors and
Sub-subcontractors that may work on or in connection with the Project to
maintain the coverages required in this Section 1, or at least equivalent
coverage; provided however, that Contractor may vary the limits of such coverage
of Subcontractors and Sub-subcontractors depending on the services provided, but
such limits shall be comparable to those customarily provided by other
contractors working within similar size and scope of business. In no event shall
the insurance requirements be deemed to limit the liability or responsibility of
Contractor or any of its Subcontractors or Sub-subcontractors to Owner.

 

  1.11.2.

Waiver of Rights. Contractor shall use commercially reasonable efforts to
require (i) all Subcontractors and Sub-subcontractors to waive the rights of
recovery, under subrogation or otherwise, against the Owner Group, and (ii) all
insurance coverage required to be carried by any Subcontractor or
Sub-subcontractor (except worker’s compensation/employer’s liability) shall be
endorsed to name the Owner Group as additional insured and the other parties
reasonably requested by Owner for their imputed liability as a result of any
Subcontractor’s or Sub-subcontractor’s operations; provided, however, if
Contractor is not able to so obtain these waivers and endorsements from any
Subcontractor or Sub-subcontractor despite using commercially reasonable
efforts, Contractor shall, in addition to any other indemnification and defense
obligations under the Agreement, defend and indemnify the Owner Group from

 

O-4

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any and all damages, losses, costs and expenses that would have otherwise been
covered if Contractor had obtained such waivers and endorsements.

 

  1.12.

Miscellaneous. Contractor shall do nothing to void or make voidable any of the
insurance policies purchased and maintained by Contractor or Owner hereunder.
Contractor shall promptly give Owner notice in writing of the occurrence of any
casualty, claim, event, circumstance, or occurrence that may give rise to a
claim under an insurance policy provided by Owner or Contractor pursuant to this
Attachment O and arising out of or relating to the performance of the Work;
provided, however, in no event shall such notice be no more than three (3) Days
after Contractor has received notice of a claim or intent to file a claim. In
addition, Contractor shall ensure that Owner is kept fully informed of any
subsequent action and developments concerning the same, and assist in the
investigation of any such casualty, claim, event, circumstance that may have a
material impact on Owner or Contractor’s ability to meet any obligations under
the Agreement.

 

2.

Owner’s Insurance.

 

  2.1.

Builders All Risk Insurance. Owner shall provide and maintain, from commencement
of any Work resulting in improvements at the Site until Substantial Completion
of the Project, builder’s risk insurance written on an “all-risk” form insuring
the Work intended to be permanently incorporated into the Project, on a
replacement cost basis while under construction and during any testing,
including hot testing. Such insurance will include design defect coverage of LEG
2/96 or equivalent, sublimits, conditions and exclusions (including for
earthquake), and shall include the interests of Owner, its Lender(s), and
Contractor (including Contractor’s Affiliates and Subcontractors). Prior to
placement, Owner shall allow Contractor a reasonable period of time to review
and comment (but not approve) the builder’s risk insurance policy, and Owner
shall provide to Contractor a certificate of insurance or copy of the policy
confirming the status of Contractor and its Subcontractors as an additional
named insured on the builder’s risk insurance policy. The insurance policy shall
provide a waiver of all rights of subrogation against the Lender(s) and
Contractor (including Contractor’s Affiliates and Subcontractors), except to the
extent limited by the terms of the policy. The furnishing of the builder’s risk
insurance by Owner shall in no way relieve, or limit, or be construed to relieve
or limit, the Contractor or the Subcontractors or Sub-subcontractors of any
other responsibility or obligation otherwise imposed by the Agreement. Insured
losses under the builder’s risk insurance shall be adjusted by or on behalf of
Owner and Contractor and made payable to Contractor and Owner as their interest
may appear or their designate(s), and Contractor shall pay its Subcontractors
their respective shares of the insurance proceeds paid by the policy; provided,
however, if Owner’s financing documents with its Lender(s) require the deposit
of insurance proceeds to a Person other than Contractor or Owner, then,
notwithstanding the foregoing, Owner shall only be obligated to pay to
Contractor its respective share of the insurance proceeds to the extent Owner
receives such proceeds under its financing documents.

 

  2.2.

Marine Cargo Insurance. Owner shall procure marine cargo insurance to provide
coverage for loss of or damage to equipment and materials and all other
property, including property in transit or temporary storage, used for or
intended for incorporation in the Work. Coverage shall be arranged on an
open-cover basis, written on an “all risk” basis to include war risks, transport
requirements, (including waterborne and airborne transit requirements for the
Work, and the unloading and reloading at temporary location and transshipment to
the Site) and overland transit requirements (including overland and
transshipments). Such insurance will include commercially reasonable sublimits,
conditions and exclusions and shall attach at the

 

O-5

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commencement of loading at the applicable Contractor or Subcontractor premises,
including temporary storage during transit, until safe unloading at the Site.
With respect to Equipment other than the Siemens Equipment, Contractor shall
bear any and all costs for insurer loss control inspections prior to and during
shipment including loading and unloading. Such insurance shall provide coverage
while the insured property is in conveyance in, by or on vessel, barge, air,
road, rail or any other conveyance by land, sea or air including connections.
Such insurance shall include the interests of Owner, its Lender(s), and
Contractor (including Contractor’s Affiliates and Subcontractors). Prior to
placement, Owner shall allow Contractor a reasonable period of time to review
and comment (but not approve) the marine cargo insurance policy, and Owner shall
provide to Contractor a certificate of insurance or copy of the policy
confirming the status of Contractor and its Subcontractors as an additional
named insured on the marine cargo insurance policy. The marine cargo insurance
policy shall provide a waiver of all rights of subrogation against the Lender(s)
and Contractor (including Contractor’s Affiliates and Subcontractors), except to
the extent limited by the terms of the policy. The furnishing of said insurance
by Owner shall in no way relieve, or limit, or be construed to relieve or limit,
Contractor or its Subcontractors or Sub-subcontractors of any other
responsibility or obligation otherwise imposed by the Agreement. Insured losses
under the marine cargo insurance shall be adjusted by or on behalf of Owner and
Contractor and made payable to Contractor and Owner as their interests may
appear or their designate(s), and Contractor shall pay its Subcontractors their
respective shares of the insurance proceeds paid by the policy; provided,
however, if Owner’s financing documents with its Lender(s) require the deposit
of insurance proceeds to a Person other than Contractor or Owner, then,
notwithstanding the foregoing, Owner shall only be obligated to pay to
Contractor its respective share of the insurance proceeds to the extent Owner
receives such proceeds under its financing documents.

 

  2.3.

Contractor Compliance. Contractor will promptly comply with the written
recommendations of Owner’s insurance carriers so that said insurance carriers
will continue to provide the coverage to be maintained by Owner pursuant to the
Agreement at a reasonable premium.

 

  2.4.

Delay In Start Up Insurance. Owner has the right, but not the obligation, to
procure and maintain delay in startup insurance in connection with the builder’s
risk insurance and marine cargo insurance. If Owner elects to procure and
maintain such insurance, any such proceeds shall be payable solely to Owner and
shall not in any way reduce or relieve Contractor of any of its obligations or
liabilities under the Agreement.

 

  2.5.

Deductibles. With respect to insurance provided by Owner under Sections 2.1 and
2.2 of this Attachment O, Contractor shall be responsible for the deductibles
under such insurance as set forth in Section 9.2A.1 of the Agreement.

 

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Execution Version

ATTACHMENT P

CONTRACTOR PERMITS

Contractor shall obtain the following Permits as well as any other Permits
required by Applicable Law to be procured in Contractor’s name.

 

Permit Description

Demolition

 

Well Installation and Drilling

 

Certificates of Occupancy

 

Construction Permits, including for Grading and Drainage, Excavation, Building
and Notice of Intent for Storm Water Construction

 

Transportation-related Permits (including Heavy Haul Permits) for transportation
of Equipment to the Site

 

 

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Execution Version

ATTACHMENT Q

OWNER PERMITS

Owner shall be responsible for obtaining the following Permits and any other
Permits required to be procured in Owner’s name under Applicable Law.

 

Permit Description

California Energy Commission Final Commission Decision

 

Bay Area Air Quality Management District Authority to Construct and Title V
Permit

 

CAISO Interconnection

 

Notice of Intent to Comply with California Statewide General Industrial
Stormwater Permit (State Water Resources Control Board Order No. 97-03-DWQ)

 

 

Q-1

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Execution Version

ATTACHMENT R

FORM OF IRREVOCABLE STANDBY PERFORMANCE LETTERS OF CREDIT

--------------------------------------------------------------------------------

SCHEDULE R-1

FORM OF CONTRACTOR LETTER OF CREDIT

***

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Execution Version

SCHEDULE R-2

FORM OF OWNER LETTER OF CREDIT

***

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Execution Version

ATTACHMENT S

PERFORMANCE TESTS

 

1.

Performance Tests. The Performance Tests will be conducted to determine whether
the Minimum Acceptance Criteria, the Performance Guarantees and the Starting
Reliability Requirement are achieved for each Unit of the Facility. The
Performance Tests shall include the following:

 

  1.1.

Net Power Output and Net Heat Rate Performance Test. The Performance Test to
measure Net Power Output and Net Heat Rate of each Unit is generally described
in Section 3.1 of this Attachment S.

 

  1.2.

Emissions Performance Test. The Performance Test to measure the emissions levels
of each Unit is generally described in Section 3.2 of this Attachment S.

 

  1.3.

Sound Level Performance Test. The Performance Test to measure the near field
sound level of each Unit is generally described in Section 3.3 of this
Attachment S.

 

  1.4.

Ramp Time Performance Test. The Performance Test to determine whether the Ramp
Time Minimum Acceptance Criteria is achieved for each Unit is generally
described in Section 3.4 of this Attachment S.

 

  1.5.

Starting Reliability Performance Test. The Performance Test to determine whether
the Starting Reliability Requirement is achieved for each Unit is generally
described in Section 3.5 of this Attachment S.

 

2.

Performance Test Procedures. The test procedures for each of the Performance
Tests are set out in general detail in this Attachment S. Contractor shall, no
later than one hundred eighty (180) Days prior to the scheduled date for
commencement of Performance Tests for the first Unit (as shown by the
then-current CPM Performance Measurement Baseline Schedule), submit to Owner for
Owner’s comment and approval, proposed procedures, meeting the requirements set
forth in this Attachment S, for each of the Performance Tests. Such proposed
procedures shall include pre-test uncertainty calculations. Thereafter, the
Parties shall meet and mutually agree upon written test procedures for all
Performance Tests, and all such written test procedures shall be agreed upon at
least ninety (90) Days prior to the commencement of any Performance Test.

 

3.

Requirements for Performance Tests.

 

  3.1.

Net Power Output and Net Heat Rate Performance Tests. ***

 

  3.2.

Emissions Performance Test. ***

 

  3.3.

Sound Level Performance Test. ***

 

  3.4.

Ramp Time Performance Test. ***

 

  3.5.

Starting Reliability Performance Test. ***

 

4.

Performance Test Measurement Uncertainty. ***

 

S-1

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5.

Third Party Testing Specialist. Owner shall have the right to have a third party
testing specialist witness any or all Performance Tests.

 

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Execution Version

ATTACHMENT T

PERFORMANCE GUARANTEES, PERFORMANCE LIQUIDATED DAMAGES, ***

AND MINIMUM ACCEPTANCE CRITERIA

 

1.

Minimum Acceptance Criteria. The “Minimum Acceptance Criteria” for each Unit of
the Facility shall be comprised of (i) the Net Power Output Minimum Acceptance
Criteria, (ii) the Net Heat Rate Minimum Acceptance Criteria, (iii) the
Emissions Minimum Acceptance Criteria, (iv) the Ramp Time Minimum Acceptance
Criteria and (v) the Sound Level Minimum Acceptance Criteria, all as further set
forth below.

 

  1.1.

Net Power Output Minimum Acceptance Criteria. Each Unit’s Net Power Output shall
be greater than or equal to *** (the “Net Power Output Minimum Acceptance
Criteria” or “Net Power Output MAC”). As used in this Attachment T and
Attachment S, the “Electric Delivery Point” means the PG&E Contra Costa
Switchyard.

 

  1.2.

Net Heat Rate Minimum Acceptance Criteria. Each Unit’s Net Heat Rate shall be
less than or equal to *** (the “Net Heat Rate Minimum Acceptance Criteria” or
“Net Heat Rate MAC”).

 

  1.3.

Emissions Minimum Acceptance Criteria. Each Unit’s emissions levels (measured at
the Unit’s stack) shall be less than or equal to: ***. In accordance with the
Performance Test Procedures and Attachment S, the emissions levels for each Unit
shall be tested while, at Owner’s reasonable discretion, such Unit is either (i)
operating in compliance with the Net Heat Rate MAC and Net Power Output MAC or
(ii) is being tested for compliance with the Net Heat Rate MAC and Net Power
Output MAC and successfully achieves both MACs in such test.

 

  1.4.

Sound Level Minimum Acceptance Criteria. Each Unit shall achieve the “Sound
Level MPC” (as defined in the Siemens Contract) in accordance with the
requirements, and under the conditions, set forth in Appendix 4 (including
Schedule 4-C) of the Siemens Contract (the “Sound Level Minimum Acceptance
Criteria” or “Sound Level MAC”). ***.

 

  1.5.

Ramp Time Minimum Acceptance Criteria. Each Unit shall successfully ramp from
its initiation of the start-up sequence to the time that the CTG output is ***
(the “Ramp Time Minimum Acceptance Criteria” or “Ramp Time MAC”).

 

2.

Performance Guarantees. The “Performance Guarantees” for each Unit of the
Facility shall be comprised of (i) the Guaranteed Net Power Output and (ii) the
Guaranteed Net Heat Rate, all as further set forth below.

 

  2.1.

Guaranteed Net Power Output. Each Unit’s Net Power Output shall be greater than
or equal to *** (the “Guaranteed Net Power Output”).

 

  2.2.

Guaranteed Net Heat Rate. Each Unit’s Net Heat Rate shall be less than or equal
to *** (the “Guaranteed Net Heat Rate”).

 

T-1

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3.

Performance Liquidated Damages. The “Performance Liquidated Damages” shall be
comprised of the Net Power Output Performance Liquidated Damages and Net Heat
Rate Performance Liquidated Damages as set forth below.

 

  3.1.

Net Power Output Performance Liquidated Damages. If the Guaranteed Net Power
Output is not met for a Unit during the Performance Tests, but the Net Power
Output Minimum Acceptance Criteria is met for such Unit during such Performance
Tests, Contractor shall owe to Owner, as Net Power Output Performance Liquidated
Damages, *** for each kilowatt that the Net Power Output for such Unit (as
measured during the Performance Tests) is less than the Guaranteed Net Power
Output (the “Net Power Output Performance Liquidated Damages”).

 

  3.2.

Net Heat Rate Performance Liquidated Damages. If the Guaranteed Net Heat Rate is
not met for a Unit during the Performance Tests, but the Net Heat Rate Minimum
Acceptance Criteria is met for such Unit during such Performance Tests,
Contractor shall owe to Owner, as Net Heat Rate Performance Liquidated Damages,
*** each Btu per kWh (HHV) that the Net Heat Rate for such Unit (as measured
during the Performance Tests) is greater than the Guaranteed Net Heat Rate (the
“Net Heat Rate Performance Liquidated Damages”).

 

4.

***

 

5.

Starting Reliability Requirement. Each Unit of the Facility shall demonstrate
the following: *** (the “Starting Reliability Requirement”). ***. In the event
any Unit fails to meet the Starting Reliability Requirement, Contractor shall
have the obligations set forth in Section 12.7C of the Agreement.

 

T-2

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Execution Version

ATTACHMENT U

CRITICAL PATH METHOD SCHEDULE REQUIREMENTS

In addition to the requirements set forth in the Agreement, the CPM Performance
Measurement Baseline Schedule and each Monthly Updated CPM Schedule
(hereinafter, as applicable, a “Schedule”) shall meet the scheduling
requirements set forth in this Attachment U.

 

1.

The Schedule shall be a critical path method (CPM) schedule prepared and updated
in Oracle Primavera Version 6.2. At the request of Owner, Contractor shall
submit this in a later version of Primavera specified by Owner, if during the
term of the Agreement, Version 6.2 becomes sufficiently obsolete that a future
version of Primavera used by Owner can no longer accurately import a Primavera
schedule created with Version 6.2.

 

2.

The Schedule shall be consistent with the Key Milestone Schedule, Guaranteed
Substantial Completion Date and Required Final Completion Date and shall
represent Contractor’s best judgment as to how it shall complete the Work in
compliance with the Key Milestone Schedule, Guaranteed Substantial Completion
Date and Required Final Completion Date.

 

3.

The Schedule shall, at a minimum, include in a single CPM network all activities
for the Work (including engineering, procurement, construction,
pre-commissioning, commissioning, testing and start-up) and shall comply with
GECP. Without limitation of the foregoing, the Schedule shall show: (i) the
duration, early/late start dates, early/late finish dates and available float
for each activity, (ii) an activity number, a unique activity description and
responsible Contractor or Subcontractor for each activity, (iii) logical
relationships between all activities with a reasonable duration for each
activity and (iv) an uninterrupted critical path from GTG LNTP through
Mechanical Completion, Substantial Completion and Final Completion.

 

4.

The Schedule shall be constructed such that the critical path can be identified
and managed as a subset of the overall Schedule. Contractor shall, in the
development of the Schedule, create enough discrete activities such that the
critical path is clearly defined. The creation of such activities and their
corresponding durations shall be subject to review and approval by Owner.

 

5.

Activity descriptions and coding in the Schedule shall facilitate finding and
interpreting the Work scope within the Schedule. All activities shall have
meaningful descriptions. The description shall clearly and uniquely communicate
the Work being done and establish uniqueness from other tasks without the aid of
other codes or groupings. No two activities shall have the same description.
Non-milestone activities shall begin with an action verb wherever appropriate,
and finish milestone descriptions shall end with a past tense of a verb wherever
appropriate (e.g., received, installed, completed, etc.)

 

6.

Within fifteen (15) Days after issuance of GTG LNTP, Contractor and Owner shall
agree upon, in writing, Primavera standards such as activity codes, calendars,
resources, etc.

 

7.

Primavera “Activity Codes” or comparable shall be utilized to segregate schedule
activities into the following categories, as a minimum. All activities are
required to have an Activity Code value for each of the following listed
categories:

 

  7.1.

Phase: which shall include, at a minimum, engineering, procurement,
construction, and start-up/testing;

 

  7.2.

Discipline: which shall include, at a minimum and as applicable, demolition and
removal, Site preparation and improvements, concrete, structural steel,
architectural, mechanical

 

U-1

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equipment, mechanical piping, electrical, instrumentation/controls, system
start-up, testing, and indirect activities;

 

  7.3.

System: which shall contain an Owner-approved number of categories to provide a
sufficient breakdown of activities to support Facility start-up. Systems should
be placed into two (2) categories: those integral to the operation of the
Facility as designed and those not integral to operation of the Facility.
Examples of non-integral systems would be architectural finishes, aesthetic Site
improvements, etc.; and

 

  7.4.

Level: which shall contain, at a minimum, the following categories: “Key
Milestone” (which, for this purpose, shall also include Substantial Completion
and Final Completion); “Management Level” (which shall contain activities
sufficient for upper management reporting and cursory review); and “Detail
Level” (the detailed body of the Schedule).

 

8.

The Schedule shall contain such detail that Owner can monitor the Work and meet
Owner’s reporting requirements to its Lenders and its customer(s) under its
power purchase agreement(s). Contractor shall limit activity durations
commensurate with the type of activity being performed. The Schedule shall
include a sufficient number of activities to accurately track progress at the
following levels:

 

  8.1.

Engineering: A sufficient number of activities shall exist in the Schedule to
enable separate progress and deliverable tracking of each engineering
discipline’s activity for each Facility system. All engineering activities shall
be interrelated and logically tied within the scheduling software to the
appropriate procurement and construction activities;

 

  8.2.

Procurement: A sufficient number of activities shall exist in the Schedule to
enable separate progress and deliverable tracking for all specific pieces of
Equipment and for general categories of bulk materials such as: structural
steel, piping (prefabricated and bulk), electrical cable, cable tray and
conduit, bulk instrumentation, and any other applicable category. Activities
should exist within each of these categories for specification preparation,
request for quotations, award to Subcontractor/Sub-subcontractor,
Subcontractor/Sub-subcontractor Drawing submission, fabrication time, delivery
of Equipment and material, and delivery of Subcontractor/Sub-subcontractor
manuals. All procurement activities shall be interrelated and logically tied
within the scheduling software to the appropriate construction activities.
Equipment shall be identified in the Schedule with the appropriate Equipment
Mark Number as identified in the project equipment list (to be delivered to
Owner pursuant to Attachment B

 

  8.3.

Construction: A sufficient number of activities shall exist in the Schedule to
enable separate progress tracking of each discipline’s Work within each system
of the Facility, both integral to operation and non-integral to operation,
including separate activities for the erection of all integral and non-integral
Equipment. An appropriate number of activities shall also be required to
adequately track progress of any item of Equipment requiring extensive field
assembly, including the Siemens Equipment, selective catalytic reduction
Equipment, water treatment equipment, field erected tanks, large pumps, motors
and fans, fuel handling equipment, natural gas conditioning package, and major
electrical Equipment. All construction activities shall be interrelated and
logically tied within the scheduling software to the appropriate start up and
testing activities;

 

  8.4.

Commissioning, Start-Up and Testing: A sufficient number of activities shall
exist in the Schedule to enable separate progress tracking of the commissioning,
start-up and testing activities for each applicable system and sub-system of the
Facility, both integral and non-integral to operation. Activities shall exist,
as applicable and at a minimum, within each applicable system and sub-system of
the Facility, for preparation and achievement of Mechanical Completion,
preparation and issuance of system testing procedures, system

 

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checkout and inspection (including completion of Mechanical Completion
checklists), development of Punchlist and completion of Punchlist Work, testing
(including Performance Tests), Substantial Completion and Final Completion. All
commissioning, start-up and testing activities shall be interrelated and
logically tied within the Schedule to overall Facility testing activities as
well as the Guaranteed Substantial Completion Date and Required Final Completion
Date. A sufficient number of activities should also exist to adequately track
progress of each Performance Test to be conducted to achieve Substantial
Completion and Final Completion; and

 

  8.5.

Permits and Interfaces with Owner Activities: Detailed activities shall be
included in the Schedule to identify the timing of receipt of Permits and
interfaces with activities involving Owner and/or third parties (including
tie-ins for natural gas fuel and utilities, electrical interconnections,
demolition of existing structures at the Site and Work activities potentially
affecting operations at the Mirant Delta Facility). In addition, Contractor will
include any other activities that Owner reasonably requests to be tracked in the
Schedule.

 

9.

The EPC and Siemens Equipment Payment Milestones and their corresponding dollar
values, as depicted in Schedule C-1 and C-2, shall be resource loaded into the
Schedule. Notwithstanding the foregoing, the ability of Contractor to be paid
for completion of those Payment Milestones shall not be withheld based on earned
value reporting derived from the Schedule; such payment shall instead be in
accordance with Article 7 of the Agreement and Attachment C.

 

10.

A generic resource shall be loaded into the Schedule for each craft to indicate
labor hours so as to produce a manhour loading curve for each craft. This
resource does not need to be priced.

 

11.

Contractor shall use standard scheduling techniques, in accordance with GECP,
and avoid complex scheduling approaches unless absolutely necessary. Contractor
shall identify any unusual, unique or otherwise complex scheduling techniques
and provide Owner with an explanation of why such technique(s) may have been
implemented.

 

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Execution Version

ATTACHMENT V

PRE-COMMISSIONING, COMMISSIONING, START-UP AND TRAINING PROGRAM

 

1.

Introduction

In addition to other requirements of the Agreement, this Attachment V provides
the general scope of activities to be performed by Contractor for the
pre-commissioning, commissioning and start-up of the Facility. Unless otherwise
expressly stated herein, any procedures developed by Contractor pursuant to this
Attachment V shall be provided to Owner for review and written approval (not to
be unreasonably withheld) no later than forty-five (45) Days prior to the
scheduled commencement of commissioning activities (as evidenced by the
then-current CPM Performance Measurement Baseline Schedule). This Attachment V
does not constitute a substitute for the Commissioning Plan, commissioning
reports completed by Contractor or the operating, training and maintenance
manuals. Rather, it forms the basis for development of such manuals by
Contractor. The following five (5) phases of activities are generally described
in this Attachment V:

 

  1.1

Construction Inspection – Cleanliness, Equipment maintenance, commissioning and
start-up spare parts, inspection, and system checkout;

 

  1.2

Training – Formal training program for Owner’s personnel, to be developed and
implemented by Contractor for all aspects of the Facility (including the Siemens
Equipment and the selective catalytic reduction system) and to be compliant with
Applicable Law and Applicable Codes and Standards;

 

  1.3

Pre-commissioning – Functional verification of Facility utility and auxiliary
systems, including electrical power, control systems, firewater, fuel gas system
and utilities necessary to support the Units during and after commissioning and
reinstatement of Equipment components; preparation of Equipment for
commissioning, start-up and testing;

 

  1.4

Commissioning and Start-Up – Mechanical Completion of the Facility; first fire
of each Unit; and start-up and tuning of each Unit;

 

  1.5

Testing – Completion of all Performance Tests.

All obligations in this Attachment V are the responsibility of Contractor or its
Subcontractors or Sub-subcontractors unless otherwise expressly stated to be the
obligation of Owner. In addition, Contractor verifies that the procedures
specified herein are in compliance with GECP, Applicable Law and Applicable
Codes and Standards. In accordance with the Agreement, including Sections 3.29
and 3.2G therein, Owner shall provide Contractor with up to six (6) of Owner’s
shift operations personnel to be integrated into the pre-commissioning,
commissioning, Performance Testing and start-up activities.

 

V-1

--------------------------------------------------------------------------------

2.

Construction Inspection

 

  2.1

Construction Inspection Program

Contractor shall cause qualified inspectors with relevant experience to check
each piece of Equipment installed. Contractor shall also implement and enforce a
routine preventative maintenance program for all Equipment, which shall
incorporate all Subcontractor and Sub-subcontractor recommendations and
requirements for preservation and storage of such Equipment.

 

  2.2

Commissioning and Start-up Spare Parts Receiving

Contractor shall establish an inspection and receiving system at the Site to
ensure that the commissioning spare parts received for commissioning and
start-up meet all requirements under the Agreement. Contractor shall develop,
track and implement a material inspection, survey and transfer receiving system
between warehouse facilities. The system shall validate quantity, completeness
and condition of the commissioning and start-up spare parts at time of transfer.
The system shall also incorporate procedures for the draw out and replacement of
these commissioning and start-up spare parts for use during commissioning and
start-up. In the event Contractor procures operating spare parts on Owner’s
behalf, Contractor shall establish an inspection and receiving system for such
operating spare parts substantially similar to the system required in this
Section for commissioning and start-up spare parts which shall be provided to
Owner for its review and prior written approval.

 

  2.3

Equipment Check Out

 

  2.3.1

Vessels

The internals of vessels shall be checked for conformance to design, including
nozzle orientation, de-misting pad installation (as applicable) and instrument
connections. Each vessel shall be inspected for cleanliness prior to closing
such vessel. Such internal inspection shall be made as soon as the vessel
arrives on Site, but nevertheless prior to installation. Following inspection
the openings shall be resealed. If a vessel is found to contain free liquid,
which may have entered at the fabrication yard or in transit, the liquid shall
be analyzed and any chance of corrosion shall be reported promptly to Owner.

 

  2.3.2

Pumps

All three phase motor drives for pumps shall be checked for proper rotation
prior to being coupled to the applicable pump.

 

  2.3.3

Fuel Gas Piping

After pressure testing, the fuel gas piping shall be blown with air or nitrogen
and then tested to ensure that all lines are free of contaminants. Blows shall
last approximately 10 seconds and shall be performed until the gas lines are
verified as clean. Following the blows, the flanges shall be inspected and
either connected to down stream piping or covered with temporary FME covers.
Each manifold shall be blown for approximately 10 seconds per blow. Blows shall
be

 

V-2

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performed until the gas lines are verified as clean. Once a gas manifold is
complete, the pig tails and end-covers should be inspected and re-connected
immediately prior to moving to the subsequent manifold.

 

  2.3.4

Compressors and Blowers

A fine mesh screen shall be added by Contractor to the suction strainer of all
compressors and blowers during initial operation and shall then be subsequently
removed by Contractor.

 

  2.3.5

Turbine Generators

The turbine generators shall be thoroughly inspected upon their arrival at the
Site to ensure all Equipment for the turbine generators has been delivered and
is free from Defects, including verification of the dimensions and arrangements
of connections to the turbine generators with the balance of the Facility (e.g.
the turbine generator foundations).

 

  2.3.6

Turbine and Compressor Maintenance

The turbines and reciprocating compressors shall be stored and maintained per
all Subcontractor and Sub-subcontractor recommendations.

 

  2.3.7

Generator Step-Up Transformers and the Electrical Package

The generator step-up transformers and the Electrical Package (including all
switchgear, distribution transformers and motor control centers) shall be
thoroughly inspected upon their arrival at the Site to ensure that all
components of such Equipment have been delivered and are free from Defects. Such
Equipment shall be stored and maintained at the Site in accordance with all
Subcontractor and Sub-subcontractor recommendations.

 

  2.3.8

Piping Systems

All piping and pressurized Equipment shall be inspected, subjected to NDT, and
pressure tested (pneumatic or hydrotest, as appropriate and to the extent
possible) after fabrication, all in accordance with Applicable Law and
Applicable Codes and Standards. Contractor shall records and provide test
reports and other applicable documentation of such testing to Owner in
accordance with Attachment B.

 

  2.4

System Checkout

 

  2.4.1

Each Equipment system or subsystem (e.g., support, utility, fuel gas, control,
fire protection, etc.) at the Facility shall be identified by Contractor during
detailed design. In accordance with Section 12.1B of the Agreement, Contractor
shall provide to Owner for its review and approval detailed Mechanical
Completion requirements, in the form of checklists, for each Equipment system or
subsystem to track the progress of the pre-commissioning, commissioning and
functional check-out of each system or subsystem in preparation for start-up of
the Facility. Checklists will be organized into system

 

V-3

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turnover packages. Each system turnover package shall include, at a minimum, a
definition of the system or subsystem boundaries, a system description, a list
of incomplete Work (kept current as the Work progresses), checkout and testing
records and a copy of the applicable Progress As-Built Drawings noting any
modifications or additions during fabrication, installation and check-out.

 

  2.4.2

Contractor shall develop and implement a schedule of required system checkouts
to ensure that systems are completed and prepared for checkout in the required
sequence. Contractor shall integrate this schedule into the CPM Performance
Measurement Baseline Schedule and Monthly Updated CPM Schedule and shall report
to Owner regarding the schedule on a regular basis. Progress of
pre-commissioning and commissioning activities will be tracked and reported
using Contractor’s commissioning status reports.

 

  2.4.3

When a system has achieved Mechanical Completion, Contractor shall provide to
Owner a fully executed Mechanical Completion Certificate, in the form of
Attachment L, for the system as required under the Agreement.

 

3.

Training

 

  3.1

Training Requirements

Contractor shall develop and implement a training program to provide training to
Owner’s operations and maintenance personnel for the Facility, who will be made
available for training at the time required according to the Monthly Updated CPM
Schedule, on the following topics, as a minimum: the hazard detection and
instrumentation systems installed at the Facility; the gas turbine generator and
its auxiliaries; the generator step-up transformers; the fuel gas compressors
and conditioning equipment; the selective catalytic reduction system; the
electrical package (including switchgear, distribution transformers and motor
control centers and PLCs) and control systems; the water treatment system; and
the operation and maintenance of all systems at the Facility for both standard
and non-standard operations. The training shall include the training to be
provided by Siemens under the Siemens Contract. Contractor shall submit this
training program in writing for review and approval by Owner no later than eight
(8) weeks prior to when the first training session is scheduled to commence.

Contractor’s training program shall be divided into modules that may be general
(applicable to all of Owner’s personnel) or specific (geared toward specific
disciplines, such as instrumentation, electrical, operations or maintenance).
The training shall cover all items of Equipment that are installed in the
Facility, and the training shall include Subcontractor and Sub-subcontractor
literature, large detailed drawings, P&IDs, overhead projector slides, and any
other useful visual aids. The training will also include training regarding
Hazardous Materials throughout the Facility, including MSDS and a description of
all such Hazardous Materials, as well as instructions on how to properly handle
such Hazardous Materials.

 

  3.2

Training Stages

 

  3.2.1

Classroom Training – Contractor shall deliver classroom training using the
prepared modules and any visual aids necessary. Classroom work will be
supplemented by field visits, and field visits, as applicable, shall be
subsequently

 

V-4

--------------------------------------------------------------------------------

 

discussed in the classroom. Classroom training shall be completed in time to
conduct the field training set forth in Section 3.2.3 below.

 

  3.2.2

Training Assessment – Assessments of Owner’s personnel receiving training shall
be carried out jointly between Contractor and Owner.

 

  3.2.3

Field Training (on-the-job training with Subcontractors and Sub-subcontractors
supplying the Equipment) – After completing the classroom training, Contractor
shall provide “on-the-job” training to Owner’s personnel. As Equipment is being
prepared for initial commissioning, Contractor shall provide operation and
maintenance training for each piece of Equipment. For major items of Equipment,
Contractor shall require the Subcontractor or Sub-subcontractor supplying such
Equipment to participate in (or conduct) the training as required under the
training program.

 

4.

Pre-Commissioning

 

  4.1

Preparation Prior to Commissioning

 

  4.1.1

Prior to commissioning, all Equipment shall be cleaned and inspected to ensure
it is free from Defects, is in accordance with the final design for such
Equipment and otherwise conforms with the requirements of the Agreement.

 

  4.1.2

All Equipment and systems shall be proven operational, to the extent possible,
prior to commencement of commissioning, including the completion of the
following:

 

  4.1.2.1

Contractor shall ensure that all valves are tight via an Owner-approved “valve
tightness test” using instrument air or the applicable system fluid.

 

  4.1.2.2

Normal electric power source shall have been checked out and functional.

 

  4.1.2.3

Potable, service water, and firewater systems shall be operational.

 

  4.1.2.4

The emergency shutdown systems shall be tested and verified operational as part
of the overall Facility instrument loop certification and calibration.

 

  4.1.2.5

Plant air and instrument air systems shall be operational.

 

  4.1.2.6

The fire fighting systems shall be tested and proven prior to introduction of
hydrocarbons into the Facility by using the largest firewater use case scenario
from the Facility’s firewater study.

 

  4.1.2.7

Relief valves will be shop calibrated and installed. A thorough check of the
entire Facility shall be made to ensure that blinds have been removed from under
any relief valves and block valves upstream and downstream of the relief valves
have been locked open, with bypass

 

V-5

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valves locked closed. A blind list shall be instituted and checked carefully.

 

  4.1.2.8

The water treatment system and wastewater disposal system shall be ready and
functional.

 

  4.1.2.9

All instruments shall be checked out, loop tested and calibrated (per
manufacturers’ recommendations or, if not available, per Applicable Codes and
Standards), and documentation completed.

 

  4.1.2.10

Fire detection systems shall have been tested to satisfy Applicable Law and
Applicable Codes and Standards and be operational. Demonstration and National
Fire Protection Association testing of the fire system and gas relief system
shall be completed and documented.

 

  4.1.2.11

Portable gas detectors shall be available in accordance with Applicable Law and
Applicable Codes and Standards.

 

  4.1.2.12

The distributed control system for the Facility shall have all loop checks and
other inspections completed and shall have been proven operational to the extent
possible.

 

  4.2

Pre-Commissioning – Electrical Interconnection

The electrical interconnection between the Facility and the utility grid shall
be, to the extent possible, checked out, tested and otherwise capable of
supplying or receiving backfeed power between the Facility and the utility grid.

 

5.

Commissioning and Start-Up

 

  5.1

Commissioning Plan Requirements

 

  5.1.1

Commissioning Plan

Contractor shall establish a commissioning plan (which shall include the
schedule of commissioning activities and the requirements for developing the
system turnover packages in accordance with Section 2.4 above), which shall be
submitted to Owner for review and comment in accordance with Section 1 (the
Owner-approved plan hereinafter referred to as the “Commissioning Plan”). The
Commissioning Plan shall outline Contractor’s plan to advance the Work from
Mechanical Completion of each system and subsystem (as well as Mechanical
Completion of the Facility as a whole) to ready for first fire of each Unit and
ready for start-up of the Facility as a whole.

 

  5.1.2

Commissioning Quality Requirements

The Commissioning Plan shall include commissioning procedures that address major
commissioning activities to be performed for the Work as well as milestones and
activities for readying the Units for first fire.

 

V-6

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Commissioning activities shall not begin on a system or subsystem of the
Equipment until (1) the Mechanical Completion Certificate for such system or
subsystem has been accepted by Owner in accordance with Section 12.3 of the
Agreement, and (2) the applicable Equipment Subcontractor operating and
maintenance manuals, and Owner-approved commissioning procedures for major
systems, are in place and available at the Site. All commissioning personnel
shall be experienced and fully conversant with the content and application of
all such procedures and activities.

 

  5.2

Start-Up Plan Requirements

 

  5.2.1

Start-Up Plan

Contractor shall establish a start-up plan (“Start-Up Plan”) which shall be
submitted to Owner for review and prior written approval in accordance with
Section 1. The Start-Up Plan shall outline how Contractor shall (i) achieve
first fire for each Unit, (ii) achieve initial synchronization to the utility
grid for each Unit and the Facility as a whole and (iii) perform initial tuning
and testing of each Unit and the Facility as a whole (including the control
systems) to reach optimum performance (including with respect to Net Heat Rate,
Net Power Output and emissions levels).

 

  5.2.2

Minimum Acceptance Criteria, Performance Guarantees and Performance Tests
Quality Requirements

The Start-Up Plan shall include start-up milestones and activities, fuel gas
consumption schedules and start-up procedures. Such Start-Up Plan shall be in
accordance with this Attachment V unless otherwise agreed upon by the Parties in
writing.

Start-up activities shall not begin on a system or subsystem of the Equipment
until (1) the Mechanical Completion Certificate has been accepted by Owner in
accordance with Section 12.3 of the Agreement, and (2) the Owner-approved
Start-Up Plan is in place and available at the Site. All personnel involved in
this testing shall be trained and shall be fully conversant with the content and
application of all such procedures. In accordance with Section 4.4 of the
Agreement, Owner will provide operating and maintenance personnel to be
supervised by Contractor for the start-up and testing activities.

 

  5.3

Technical Support Requirements

Subject to Section 4.4 of the Agreement, Contractor shall provide all the
required support services, Subcontractor and Sub-subcontractor representatives
and technicians necessary for proper installation, preparation, commissioning,
testing, and start-up of the Facility and Equipment.

 

6.

Performance Testing

Performance Testing shall be conducted in accordance with the requirements of
the Agreement.

 

7.

Operation

 

V-7

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Contractor’s operation of the Facility through the achievement of Substantial
Completion shall be performed in accordance with the requirements of the
Agreement, including GECP, Applicable Codes and Standards and Applicable Law.

 

V-8

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Execution Version

ATTACHMENT W

SPARE PARTS LIST

 

Spare Part

 

Manufacturer

Name

 

Manufacturer

Contact Information

   Equipment/System
Containing the
Spare Part    Part No.    Current Price (US$)

 

W-1

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Execution Version

ATTACHMENT X

REPORTING REQUIREMENTS

 

X-1

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I.

Monthly Progress Report Format

The Monthly Progress Report shall be provided by Contractor by the 5th Day of
each Month. The framework set forth below provides the format that should be
used for each of Contractor’s Monthly Progress Reports. Each section set forth
below shall be fully and accurately completed by Contractor in each Monthly
Progress Report. In addition, Contractor shall include a statement in each
Monthly Progress Report that all information set forth therein is true and
accurate as of the date of issuance.

 

  1.

Project Summary

 

  2.

Executive Summary

 

  a.

Executive Summary Narrative

 

  b.

Significant Activities Completed Since Last Monthly Progress Report (including
all Payment Milestones completed)

 

  c.

Significant Activities Planned but Not Completed Since Last Monthly Progress
Report (including all Payment Milestones planned to be completed but not
completed)

 

  d.

Significant Activities Planned for the Current Month (including all Payment
Milestones planned to be completed)

 

  e.

Significant Problems Encountered & Remedial Actions Taken

 

  3.

Safety and Health Report / Environmental Report

 

  a.

Results of Safety Inspections

 

  b.

Safety Training

 

  c.

Lost work time accidents & other significant safety incidents

 

  i.

Recordable Incident Rate

 

Month

   YTD    Project to Date      

 

  ii.

Lost Time Incident Rate

 

Month

   YTD    Project to Date      

 

X-2

--------------------------------------------------------------------------------

  d.

Hours Worked

 

     Month    YTD    Project to date

Contractor

        

Subcontractors

        

Total

        

 

  e.

Work Stoppages due to Safety

 

  f.

Other Safety Concerns and Remedial Measures Taken

 

  g.

Results of Environmental Inspections

 

  h.

Environmental Training

 

  i.

Environmental Incidents

 

Month

   YTD    Project to Date      

 

  j.

Work Stoppages due to Environmental Incidents (including encountering
pre-existing Hazardous Materials) and Remedial Measures Taken

 

  4.

Engineering Status

 

  a.

Engineering Summary

 

  b.

Major Engineering Activities by Discipline

 

  i.

Civil/Structural

 

  1.

Major Activities Completed

 

  2.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  3.

Major Activities Planned for the Current Month

 

  4.

Major Problems Encountered & Remedial Actions Taken

 

  ii.

Mechanical

 

  1.

Major Activities Completed

 

  2.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  3.

Major Activities Planned for the Current Month

 

  4.

Major Problems Encountered & Remedial Actions Taken

 

  iii.

Electrical/Controls

 

  1.

Major Activities Completed

 

X-3

--------------------------------------------------------------------------------

  2.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  3.

Major Activities Planned for the Current Month

 

  4.

Major Problems Encountered & Remedial Actions Taken

 

  iv.

Permitting

 

  1.

List of Contractor Permits

 

Contractor Permit

   Baseline    Actual/
Forecast    Days
Variance                                             

 

  2.

Major Problems Encountered & Remedial Actions Taken

 

  c.

Engineering manpower histogram with cumulative curve (S Curve) with baseline,
actual & forecasted manpower by Month

 

  i.

Overall Engineering Manpower

 

  ii.

Civil/Structural Manpower

 

  iii.

Mechanical Manpower

 

  iv.

Electrical/Controls Manpower

 

  5.

Procurement Status

 

  a.

Major Activities Completed

 

  b.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  c.

Major Activities Planned for the Current Month

 

  d.

Major Problems Encountered & Remedial Actions Taken

 

  6.

Construction Status

 

  a.

Construction Summary

 

  b.

Construction Activities directly performed by Contractor

 

  i.

Major Activities Completed

 

X-4

--------------------------------------------------------------------------------

  ii.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  iii.

Major Activities Planned for the Current Month

 

  iv.

Major Problems Encountered & Remedial Actions Taken

 

  v.

Photographs

 

  c.

Construction Activities by Major Subcontractor

 

  1.

Major Activities Completed

 

  2.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  3.

Major Activities Planned for the Current Month

 

  4.

Major Problems Encountered & Remedial Actions Taken

 

  5.

Photographs

 

  d.

Construction manpower histograms with cumulative curve (S Curve) with baseline,
actual & forecasted manpower by Month

 

  i.

Overall Construction Manpower

 

  ii.

Craft A

 

  iii.

Craft B

 

  iv.

Craft C

 

  v.

(Etc. for each craft)

 

  e.

Quantity Installation Curves

 

  i.

Concrete

 

  ii.

Electrical

 

  iii.

Above Ground Piping (L/B & S/B)

 

  iv.

Etc. (other crafts as applicable)

 

  7.

Interconnections

 

  a.

Major Activities Completed

 

  b.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  c.

Major Activities Planned for the Current Month

 

  d.

Major Problems Encountered & Remedial Actions Taken

 

X-5

--------------------------------------------------------------------------------

  8.

Startup & Commissioning

 

  a.

Major Activities Completed

 

  b.

Major Activities Planned but Not Completed Since Last Monthly Progress Report

 

  c.

Major Activities Planned for the Current Month

 

  d.

Major Problems Encountered & Remedial Actions Taken

 

  e.

System Status (produced within 3 Months prior to the planned Mechanical
Completion Date for the first system to be completed).

 

     Mechanical
Completion    Mechanical
Completion
Handover Package
Complete    Start-up and
Performance
Testing Procedure
Complete    Ready for
Performance
Testing    Substantial
Completion

System

   Baseline    Actual/
Forecast    Baseline    Actual/
Forecast    Baseline    Actual/
Forecast    Baseline    Actual/
Forecast    Baseline    Actual/
Forecast                                                                        
                                                                                
                                                        

 

  9.

Third-Party Claims: Actual or potential third-party claims against Contractor or
the Facility of which Contractor is aware or suspects may arise.

 

  10.

Monthly Updated CPM Schedule Analysis

 

  a.

Monthly Updated CPM Schedule Analysis Summary

 

  i.

Float/Critical Path Summary

 

  ii.

Earned Value Schedule Performance Index

 

  b.

Status of Major Milestones (including Key Milestones)

 

Activity ID

   Milestone    Baseline
Finish    Actual/
Forecast
Finish    Days
Float                                                            

 

X-6

--------------------------------------------------------------------------------

Activity ID

   Milestone    Baseline
Finish    Actual/
Forecast
Finish    Days
Float                                                            

 

  c.

Monthly Updated CPM Schedule Variance Report

 

  d.

Major Problems Encountered & Remedial Actions Taken

 

  e.

Recovery Plans, including Recovery Schedule (as applicable)

 

  11.

Contract Price Report

 

  a.

Contract Price Summary (identifying allocation between Siemens Payment
Milestones and EPC Payment Milestones)

 

  b.

Curve showing Monthly baseline, actual, incurred and forecasted completion of
Payment Milestones (cash flow)

 

  c.

Summary of changes to Contract Price (via approved Change Orders) showing
changes, additions and deletions of Payment Milestones

 

  d.

Summary of potential changes to the Contract Price

 

  i.

Current Contractor Change Order Requests

 

  ii.

Trends and Exposures (identification of potential situations which may give rise
to a Change Order request for an adjustment to the Contract Price in the future
for which a Change Order Request has not yet been received)

 

  e.

Change Order Control Log

 

  i.

Approved Change Orders

 

Change Order #

   Description    Contract Price    Schedule       Change
Amount    Prior
Total    Revised
Total    Key
Milestones
Affected    Prior Key
Milestone
Date    Revised Key
Milestone
Date                                                                           
        

 

X-7

--------------------------------------------------------------------------------

Change Order #

   Description    Contract Price    Schedule       Change
Amount    Prior
Total    Revised
Total    Key
Milestones
Affected    Prior Key
Milestone
Date    Revised Key
Milestone
Date                                          

 

  ii.

Pending Change Orders (Contractor Change Order Requests and Owner-proposed
changes)

 

Change Order #

   Description    Proposed Contract Price
Changes    Proposed Schedule Changes       Proposed
Change
Amount    Prior
Total    Proposed
Revised
Total    Key
Milestones
Proposed to
be Affected    Current Key
Milestone Date    Proposed
Revised Key
Milestone Date                                                                  
                                                                                

 

  iii.

Rejected Change Orders

 

Change Order #

   Description    Proposed
Contract Price
Changes    Proposed Schedule Changes       Change
Amount    Key
Milestones
Proposed  to
be Affected    Current Key
Milestone
Date    Proposed
Revised Key
Milestone Date                                                                  
                                      

 

X-8

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APPENDIX 1: PRIMAVERA SCHEDULE REPORTS

Appendix 1 shall include the following reports along with any other reports that
may be specified by Owner as required:

 

  A.

Key Milestone Schedule with Target

 

  B.

Key & Payment Milestone Schedule with Target

 

  C.

Summary Monthly Updated CPM Schedule with Comparison to Summary CPM Performance
Measurement Baseline Schedule (in native electronic format and hard copy as
required by the Agreement, including Attachment U)

 

  D.

Detailed Monthly Updated CPM Schedule with Comparison to Detailed CPM
Performance Measurement Baseline Schedule (in native electronic format and hard
copy as required by the Agreement, including Attachment U)

 

  E.

Recovery Schedule (as applicable)

 

  F.

Acceleration Schedule (as applicable)

 

  G.

Critical Path with Target

 

  H.

Near Critical Activities (<10 Days float) with Target

 

  I.

3 Month Look Ahead by System

 

  J.

3 Month Look Ahead by Phase, & Engineering Discipline/Craft

 

  K.

Procurement Schedule

 

  L.

Engineering Schedule by Discipline

 

  M.

Construction Schedule by Area

 

  N.

Expected Mechanical Completion Date by System

 

X-9

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APPENDIX 2: DRAWING LOG /ISSUE FOR CONSTRUCTION (IFC) SCHEDULE

 

Drawing #

  

Title

   Baseline
IFC    Actual/
Forecast
IFC    Days
Variance

Civil/Structural Drawings

                                                                                

Mechanical Drawings

                                                        

Electrical/Controls Drawings

                                                                    

 

X-10

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APPENDIX 3: EQUIPMENT LOG

 

               Bid Release Date    Equipment Release Date    Equipment Delivered
to Site

PO #

   Description    Subcontractor/
Subcontractor
Shop  Location    Baseline    Actual/
Forecast    Days
Variance    Baseline    Actual/
Forecast    Days
Variance    Baseline    Actual/
Forecast    Days
Variance                                                                        
                                                                                
           

 

X-11

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II.

Weekly Progress Report Format

The Weekly Progress Report shall be provided by Contractor on each Tuesday
covering all Work performed up through the previous week. The framework set
forth below provides the format that should be used for each of Contractor’s
Weekly Progress Reports. Each section set forth below shall be fully and
accurately completed by Contractor in each Weekly Progress Report. In addition,
Contractor shall include a statement in each Weekly Progress Report that all
information set forth therein is true and accurate as of the date of issuance.

 

  1.

Safety

 

  a.

Recordable Incident Rate

 

Week

   YTD    To Date for the Work      

 

  b.

Lost Time Incident Rate

 

Week

   YTD    To Date for the Work      

 

  2.

Environmental Incidents

 

Week

   YTD    To Date for the Work      

 

  3.

Hours Worked

 

     Week    To Date for the Work

Contractor

     

Subcontractors

     

Total

     

 

  4.

Schedule Summary

 

  a.

Status of Major Activities Scheduled for this Week

 

Activity

   Baseline Date    Actual Date    Current Forecasted                           

 

  b.

Major Activities Completed This Week

 

  c.

Major Activities Planned but Not Completed This Week

 

  d.

Major Activities Planned for the Next Week

 

  e.

Major Problems Encountered & Remedial Actions Taken

 

  f.

Other Issues and Concerns

 

X-12

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Execution Version

ATTACHMENT Y

SITE

***

 

Y-1

--------------------------------------------------------------------------------

Execution Version

ATTACHMENT Z

FORM OF PARENT GUARANTEES

 

Z-1

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SCHEDULE Z-1

FORM OF CONTRACTOR’S PARENT GUARANTEE

This GUARANTEE (this “Guarantee”), dated as of [                    ], is made
by Kiewit Construction Company, a Delaware corporation (“Guarantor”), in favor
of Mirant Marsh Landing, LLC, a Delaware limited liability company (“Owner,”
and, together with Guarantor, each a “Party” and, collectively, the “Parties”).
Capitalized terms used, but not otherwise defined, herein shall have the
respective meanings ascribed to such terms in the Agreement (as defined below).

RECITALS

WHEREAS, Owner has agreed to enter into the Lump Sum Turnkey Agreement for the
Engineering, Procurement and Construction of the Marsh Landing Generating
Station, dated [                    ] (the “Agreement”), with Kiewit Power
Constructors Co. (“Contractor”), a subsidiary of Guarantor, which is hereby
incorporated by reference in this Guarantee and made a part hereof, for the
engineering, procurement and construction of a natural gas-fired electric
generation facility located near Antioch, California;

WHEREAS, Contractor is a subsidiary of Guarantor;

WHEREAS, Guarantor is guaranteeing the payment and performance by Contractor of
any and all obligations or amounts owed by Contractor to Owner under the
Agreement; and

WHEREAS, it is a requirement within the Agreement that Guarantor execute and
deliver this Guarantee.

NOW THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties hereby agree as follows:

1. Guarantee.

(a) On the terms and subject to the conditions contained herein, Guarantor
hereby irrevocably guarantees, to and for the benefit of Owner, the full and
punctual performance and payment, as and when each such payment or performance
becomes due (whether at the stated due date, by acceleration or otherwise), by
or on behalf of Contractor of any and all obligations or amounts owed by
Contractor to Owner in connection with and to the extent provided for in the
Agreement (the “Guaranteed Obligations”). The Guaranteed Obligations of
Guarantor hereunder are direct and primary obligations.

(b) This Guarantee is a present, and continuing guarantee of performance and
payment, and not of collection, is in no way conditioned or contingent upon any
attempt to collect from or enforce performance or payment by Contractor, and
shall remain in full force and effect and be binding upon and against Guarantor
and its successors and permitted assigns (and shall inure to the benefit of
Owner and its permitted successors, permitted endorsees, permitted transferees,
and permitted assigns). If Contractor shall fail or be unable duly, punctually,
and

 

Z-2

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fully to perform or pay, as and when such performance or payment is due, any of
the Guaranteed Obligations, and taking into account any grace period applicable
with respect thereto under the Agreement, then upon receipt of written notice
from Owner specifying the failure, Guarantor shall promptly perform or pay, or
cause to be performed or paid, such Guaranteed Obligations as required pursuant
to the terms and conditions of the Agreement.

(c) Guarantor agrees that any final judgment from any final award resulting from
any litigation between Contractor and Owner under the Agreement (whether in
contested litigation, by default or otherwise) shall be conclusive and binding
on the Parties for the purposes of determining Guarantor’s obligations under the
Guarantee.

2. Obligations Continuing.

(a) Guarantor agrees that the obligations of Guarantor set forth in this
Guarantee shall be direct obligations of Guarantor, and that such obligations
shall be irrevocable, and that except for those specific defenses which
Contractor would be entitled to assert if an action or proceeding to enforce
such obligations were to be asserted or instituted against Contractor based upon
the Agreement (which defenses Guarantor hereby retains and is authorized to
assert), including any limitation of liability under Section 21.1 of the
Agreement, this Guarantee shall not be subject to any counterclaim, set-off,
deduction, diminution, abatement, recoupment, suspension, deferment, reduction
or defense (other than full and strict compliance with its obligations
hereunder) based upon any claim Guarantor or any other Person may have against
Owner or any other Person and shall remain in full force and effect without
regard to and shall not be released, discharged or in any way affected or
impaired by, any circumstance or condition whatsoever (other than full and
strict compliance by Guarantor with its obligations hereunder) (whether or not
Guarantor shall have any knowledge or notice thereof), including, without
limitation: (i) any amendment or modification of or supplement to or other
change in the Agreement or any other document to which Contractor or its
permitted assigns are a party, including, without limitation, any change order,
renewal, extension, acceleration or other changes to payment terms thereunder;
(ii) any waiver, consent, extension, indulgence, compromise, release or other
action or inaction under or in respect of the Agreement or any other related
document or any related obligation or liability of Owner or Contractor, or any
exercise or non-exercise of any right, remedy, power, or privilege under or in
respect of any such instrument or agreement or any such obligation or liability;
(iii) any bankruptcy, insolvency, reorganization, arrangement, readjustment,
liquidation, or similar proceeding with respect to Owner, Contractor, or any
other Person or any of their respective properties, or any action taken by any
trustee or receiver or by any court in any such proceeding; (iv) any merger or
consolidation of Guarantor or Contractor into or with any other Person or any
sale, lease, or transfer of all or any of the assets of Guarantor or Contractor;
(v) any change in the ownership of Guarantor, Contractor, or any other Person;
(vi) any winding up or dissolution of Contractor; or (vii) to the extent
permitted under Applicable Law, any other occurrence or circumstance whatsoever,
whether similar or dissimilar to the foregoing, which might otherwise constitute
a legal or equitable defense or discharge of the liabilities of guarantor or
surety or which might otherwise limit recourse against Guarantor. The Guaranteed
Obligations constitute the full recourse obligations of Guarantor enforceable
against it to the full extent of all its assets and properties. Without limiting
the generality of the foregoing, Guarantor agrees that repeated and successive
demands may be made and recoveries may be had hereunder as and when, from time
to time, Contractor shall fail to

 

Z-3

--------------------------------------------------------------------------------

perform obligations or pay amounts owed by Contractor under the Agreement and
that notwithstanding the recovery hereunder for or in respect of any given
failure to so comply by Contractor under the Agreement, this Guarantee shall
remain in full force and effect and shall apply to each and every subsequent
such failure.

(b) Notwithstanding any other language in this Guarantee to the contrary (but
subject at all times to the exception set forth in this Section 2(b)),
Guarantor’s obligations and liability under this Guarantee shall not differ from
or exceed the obligations and liabilities of Contractor under the Agreement, nor
shall the remedies available to Owner under this Guarantee extend beyond the
remedies available to Owner against Contractor under the Agreement; provided
that in no case shall this Section 2(b) be interpreted to relieve Guarantor of
any Guaranteed Obligations or preclude any remedy available to Owner due to any
of the circumstances in Sections 2(a)(iii) or 2(a)(vi).

3. Reinstatement. Guarantor agrees that this Guarantee shall be automatically
reinstated with respect to any payment made by or on behalf of Contractor
pursuant to the Agreement if and to the extent that such payment is rescinded or
must be otherwise restored pursuant to Applicable Law, whether as a result of
any proceedings in bankruptcy or reorganization or otherwise.

4. Waiver of Demands, Notices. Guarantor hereby unconditionally waives, to the
extent permitted by Applicable Law: (i) notice of any of the matters referred to
in Section 2 hereof; (ii) all notices which may be required by Applicable Law,
or otherwise, now or hereafter in effect, to preserve any rights against
Guarantor hereunder, including, without limitation, any demand, proof, or notice
of non-payment or non-performance of any Guaranteed Obligation; (iii) notice of
acceptance of this Guarantee, demand, protest, presentment, notice of failure of
performance or payment, and any requirement of diligence; and (iv) any
requirement to exhaust any remedies.

5. Waiver of Subrogation. Until such time as the Guaranteed Obligations are
performed and paid in full, Guarantor shall not seek or be entitled to assert or
enforce any right of contribution, reimbursement, indemnification or any other
right to payment from Contractor as a result of Guarantor’s performance of its
obligations pursuant to this Guarantee. If any funds or property shall be paid
or transferred to Guarantor on account of such subrogation, contribution,
reimbursement or indemnification at any time when all of the Guaranteed
Obligations have not been performed and paid in full, Guarantor shall hold such
funds or property in trust for Owner and shall forthwith pay over to Owner such
funds and/or property to be applied by Owner to the Guaranteed Obligations,
whether or not matured, in such order as Owner may determine.

6. Representations and Warranties. Guarantor represents and warrants that:

(a) it is a corporation duly organized and validly existing under the laws of
the State of Delaware and has the corporate power and authority to execute,
deliver and carry out the terms and provisions of the Guarantee;

(b) the execution, delivery and performance of this Guarantee will not conflict
with, violate or breach the terms of any agreement of Guarantor;

 

Z-4

--------------------------------------------------------------------------------

(c) no authorization, approval, consent or order of, or registration or filing
with, any court or other governmental body having jurisdiction over Guarantor is
required on the part of Guarantor for the execution and delivery of this
Guarantee; and

(d) this Guarantee, when executed and delivered, will constitute a valid and
legally binding agreement of Guarantor, except as the enforceability of this
Guarantee may be limited by the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ rights generally
and by general principles of equity as they apply to the Guarantor.

7. Miscellaneous.

(a) This Guarantee shall inure to the benefit of and be binding upon the Parties
hereto and their respective successors and permitted assigns. Neither Party may
assign or transfer this Guarantee or any rights or obligations hereunder without
the other Party’s prior written consent. Notwithstanding the foregoing, this
Guarantee may be assigned by Owner without the written consent of Guarantor
(i) to assign, pledge and/or grant a security interest in, or payment obligation
under this Guarantee or (ii) to the same extent that Owner is able to assign the
Agreement pursuant to Section 22.7 therein. Except as provided in this
Section 7, nothing herein, express or implied, is intended or shall be construed
to confer upon or to give to any Person other than the Parties hereto any
rights, remedies, or other benefits.

(b) This Guarantee shall be governed by, and construed in accordance with, the
laws of the state of New York except for any choice or conflict of law provision
or rule (whether of the State of New York or any other jurisdiction) other than
Section 5-1401 of the New York General Obligations Law.

(c) The Parties agree that any dispute, controversy or claim (“Dispute”) arising
out of or relating to this Guarantee shall be decided by litigation pursuant to
this Section 7(c). Litigation of any Dispute shall be brought exclusively in a
federal or state court located in New York County in the State of New York. Each
Party hereby consents to personal jurisdiction in any legal action, suit, or
proceeding brought in any federal or state court within New York County in the
State of New York having subject matter jurisdiction and irrevocably waives, to
the fullest extent permitted by Applicable Law and the laws of the State of New
York, any claim or any objection it may now or hereafter have, that venue or
personal jurisdiction is not proper with respect to any such legal action, suit,
or proceeding brought in such a court in the State of New York, including any
claim that such legal action, suit, or proceeding brought in such court has been
brought in an inconvenient forum. Each Party further consents to the service of
process out of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by registered or certified mail, postage
prepaid, to such Party at its address specified herein for the giving of
notices, or by such other notice given in accordance with the rules and
procedures of such courts.

(d) No modification or amendment of this Guarantee shall be of any force or
effect unless made in writing, signed by the Parties hereto, and specifying with
particularity the nature and extent of such modification or amendment. This
Guarantee constitutes the entire and only understanding and agreement among the
Parties hereto with respect to the subject matter hereof and cancels and
supersedes any prior negotiations, proposals, representations, understandings,

 

Z-5

--------------------------------------------------------------------------------

commitments, communications, or agreements, whether oral or written, with
respect to the subject matter hereof.

(e) Notice. All notices pertaining to the Agreement shall be in the English
language and signed by a duly authorized representative of the Party giving such
notice, shall reference the Agreement, shall be sent by registered or certified
mail, recognized express courier or facsimile (followed by registered mail) to
the other Party at the address designated below, and shall be effective upon
delivery:

 

  (i)

if delivered to Guarantor:

Kiewit Construction Company

9401 Renner Blvd.

Lenexa, KS 66219

Attention: Kevin Needham

Fax No.: 913-928-7214

with a copy to:

Kiewit Construction Company

9401 Renner Blvd.

Lenexa, KS 66219

Attention: Robert Osborn

Phone No.: 913-928-7895

Fax No.: 913-928-7895

 

  (ii)

if delivered to Owner:

Mirant Marsh Landing, LLC

1155 Perimeter Center West

Atlanta, GA 30338

Attn: Mike Ammer

Phone No.: (678) 579-5103

Email: michael.ammer@mirant.com

with a copy to:

Mirant Corporation

1155 Perimeter Center West

Atlanta, GA 30338

Attn: General Counsel

Fax No.: (678) 579-5951

or to such other address or telecopy number and with such other copies, as such
Party may hereafter reasonably specify by notice to the other Parties. Each such
notice, request or communication shall be effective upon receipt, provided that
if the day of receipt is not a Business Day then it shall be deemed to have been
received on the next succeeding Business Day.

 

Z-6

--------------------------------------------------------------------------------

(f) The headings of the several provisions of this Guarantee are inserted for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Guarantee.

(g) No forbearance or delay by Owner in asserting rights against Contractor
shall affect or impair in any way Guarantor’s obligations hereunder or the
rights of Owner hereunder.

(h) The term “Person” shall mean any individual, company, joint venture,
corporation, partnership, association, joint stock company, limited liability
company, trust, estate, unincorporated organization, governmental entity or
other entity having legal capacity.

(i) This Guarantee may be executed in any number of separate counterparts and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument.

[Signature Page Follows]

 

Z-7

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the undersigned have duly executed this Guarantee as of the
date first above written.

 

KIEWIT CONSTRUCTION COMPANY

By:

 

 

Name:

 

 

Title:

 

 

MIRANT MARSH LANDING, LLC

By:

 

 

Name:

 

 

Title:

 

 

Acknowledged:

 

Kiewit Power Constructors Co.

By:

 

 

Name:

 

 

Title:

 

 

 

Z-8

--------------------------------------------------------------------------------

Execution Version

SCHEDULE Z-2

FORM OF OWNER’S PARENT GUARANTEE

This GUARANTEE (this “Guarantee”), dated as of [                    ], is made
by Mirant Corporation, a Delaware corporation (“Guarantor”), in favor of Kiewit
Power Constructors Co. (“Contractor,” and, together with Guarantor, each a
“Party” and, collectively, the “Parties”). Capitalized terms used, but not
otherwise defined, herein shall have the respective meanings ascribed to such
terms in the Agreement (as defined below).

RECITALS

WHEREAS, Contractor has agreed to enter into the Lump Sum Turnkey Agreement for
the Engineering, Procurement and Construction of the Marsh Landing Generating
Station, dated [                    ] (the “Agreement”), with Mirant Marsh
Landing, LLC (“Owner”), a subsidiary of Guarantor, which is hereby incorporated
by reference in this Guarantee and made a part hereof, for the engineering,
procurement and construction of a natural gas-fired electric generation facility
located near Antioch, California; and

WHEREAS, Owner is a subsidiary of Guarantor;

WHEREAS, Guarantor is guaranteeing the payment obligations by Owner of the
Kiewit Termination Charge (as such term is defined in Section 17.2 of the
Agreement) owed by Owner to Contractor under the Agreement.

WHEREAS, it is a requirement within the Agreement that Guarantor execute and
deliver this Guarantee.

NOW THEREFORE, in consideration of the promises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Parties hereby agree as follows:

1. Guarantee.

(a) On the terms and subject to the conditions contained herein, Guarantor
hereby irrevocably guarantees, to and for the benefit of Contractor, the full
and punctual payment of the Kiewit Termination Charge (as such term is defined
in Section 17.2 of the Agreement) in the event of (i) a termination for
convenience of the Agreement by Owner pursuant to Section 17.2 of the Agreement
or (ii) a termination of the Agreement by Contractor pursuant to Section 17.5 of
the Agreement, as and when such payment becomes due, by or on behalf of Owner in
connection with and to the extent provided for in the Agreement (the “Guaranteed
Obligations”); provided, however, notwithstanding anything to the contrary,
Guarantor’s payment guarantee for such Guaranteed Obligations shall not exceed
***. The Guaranteed Obligations of Guarantor hereunder are direct and primary
obligations.

(b) This Guarantee is a present, and continuing guarantee of payment, and not of
collection, is in no way conditioned or contingent upon any attempt to collect
from or enforce

 

Z-9

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payment by Owner, and shall remain in full force and effect and be binding upon
and against Guarantor and its successors and permitted assigns (and shall inure
to the benefit of Contractor and its permitted successors, permitted endorsees,
permitted transferees, and permitted assigns). If Owner shall fail or be unable
duly, punctually, and fully to pay, as and when such payment is due, any of the
Guaranteed Obligations, and taking into account any grace period applicable with
respect thereto under the Agreement, then upon receipt of written notice from
Contractor specifying that the Kiewit Termination Charge is due under
Section 17.2 of the Agreement, Guarantor shall promptly pay, or cause to be
paid, such Guaranteed Obligations as required pursuant to the terms and
conditions of the Agreement.

(c) Guarantor agrees that any final judgment from any final award resulting from
any litigation between Contractor and Owner under the Agreement with respect to
the Guaranteed Obligations (whether in contested litigation, by default or
otherwise) shall be conclusive and binding on the Parties for the purposes of
determining Guarantor’s obligations under the Guarantee.

2. Obligations Continuing; Etc.

(a) Guarantor agrees that the obligations of Guarantor set forth in this
Guarantee shall be direct obligations of Guarantor, and that such obligations
shall be irrevocable, and that except for those specific defenses which Owner
would be entitled to assert if an action or proceeding to enforce such
obligations were to be asserted or instituted against Owner based upon the
Agreement (which defenses Guarantor hereby retains and is authorized to assert),
including the limitation of liability for this Guarantee under Section 10.5 of
the Agreement, this Guarantee shall not be subject to any counterclaim, set-off,
deduction, diminution, abatement, recoupment, suspension, deferment, reduction
or defense (other than full and strict compliance with its obligations
hereunder) based upon any claim Guarantor or any other Person may have against
Contractor or any other Person and shall remain in full force and effect without
regard to and shall not be released, discharged or in any way affected or
impaired by, any circumstance or condition whatsoever (other than full and
strict compliance by Guarantor with its obligations hereunder) (whether or not
Guarantor shall have any knowledge or notice thereof), including, without
limitation: (i) any amendment or modification of or supplement to or other
change in the Agreement or any other document to which Owner or its permitted
assigns are a party, including, without limitation, any change order, renewal,
extension, acceleration or other changes to payment terms thereunder; (ii) any
waiver, consent, extension, indulgence, compromise, release or other action or
inaction under or in respect of the Agreement or any other related document or
any related obligation or liability of Owner or Contractor, or any exercise or
non-exercise of any right, remedy, power, or privilege under or in respect of
any such instrument or agreement or any such obligation or liability; (iii) any
bankruptcy, insolvency, reorganization, arrangement, readjustment, liquidation,
or similar proceeding with respect to Owner, Contractor or any other Person or
any of their respective properties, or any action taken by any trustee or
receiver or by any court in any such proceeding; (iv) any merger or
consolidation of Guarantor or Owner into or with any other Person or any sale,
lease, or transfer of all or any of the assets of Guarantor or Owner; (v) any
change in the ownership of Guarantor, Owner or any other Person; (vi) any
winding up or dissolution of Owner; or (vii) to the extent permitted under
Applicable Law, any other occurrence or circumstance whatsoever, whether similar
or dissimilar to the foregoing, which might otherwise constitute a legal or
equitable defense or discharge of the liabilities of

 

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guarantor or surety or which might otherwise limit recourse against Guarantor.
The Guaranteed Obligations constitute the full recourse obligations of Guarantor
enforceable against it to the full extent of all its assets and properties.
Without limiting the generality of the foregoing, Guarantor agrees that repeated
and successive demands may be made and recoveries may be had hereunder as and
when, from time to time, Owner shall fail to pay the Guaranteed Obligations owed
by Owner under the Agreement and that notwithstanding the recovery hereunder for
or in respect of any given failure to so comply by Owner under the Agreement,
this Guarantee shall remain in full force and effect and shall apply to each and
every subsequent such failure.

(b) Notwithstanding any other language in this Guarantee to the contrary (but
subject at all times to (i) the limitation of liability for the Guaranteed
Obligations set forth in Section 1(a) and (ii) the exception set forth in this
Section 2(b)), Guarantor’s obligations and liability for the Guaranteed
Obligations under this Guarantee shall not differ from or exceed the obligations
and liabilities of Owner under the Agreement, nor shall the remedies available
to Contractor under this Guarantee extend beyond the remedies available to
Contractor against Owner under the Agreement; provided that in no case shall
this Section 2(b) be interpreted to relieve Guarantor of any Guaranteed
Obligations or preclude any remedy available to Contractor due to any of the
circumstances in Sections 2(a)(iii) or 2(a)(vi).

3. Reinstatement. Guarantor agrees that this Guarantee shall be automatically
reinstated with respect to any payment made by or on behalf of Owner pursuant to
the Agreement if and to the extent that such payment is rescinded or must be
otherwise restored pursuant to Applicable Law, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise.

4. Waiver of Demands, Notices; Etc. Guarantor hereby unconditionally waives, to
the extent permitted by Applicable Law: (i) notice of any of the matters
referred to in Section 2 hereof; (ii) all notices which may be required by
Applicable Law, or otherwise, now or hereafter in effect, to preserve any rights
against Guarantor hereunder, including, without limitation, any demand, proof,
or notice of non-payment of the Guaranteed Obligations; (iii) notice of
acceptance of this Guarantee, demand, protest, presentment, notice of failure of
payment, and any requirement of diligence; and (iv) any requirement to exhaust
any remedies.

5. Waiver of Subrogation. Until such time as the Guaranteed Obligations are paid
in full, Guarantor shall not seek or be entitled to assert or enforce any right
of contribution, reimbursement, indemnification or any other right to payment
from Owner as a result of Guarantor’s performance of its obligations pursuant to
this Guarantee. If any funds or property shall be paid or transferred to
Guarantor on account of such subrogation, contribution, reimbursement or
indemnification at any time when all of the Guaranteed Obligations have not been
paid in full, Guarantor shall hold such funds or property in trust for
Contractor and shall forthwith pay over to Contractor such funds and/or property
to be applied by Contractor to the Guaranteed Obligations, whether or not
matured, in such order as Contractor may determine.

6. Representations and Warranties. Guarantor represents and warrants that:

(a) it is a corporation duly organized and validly existing under the laws of
the State of Delaware and has the corporate power and authority to execute,
deliver and carry out the terms and provisions of the Guarantee;

 

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(b) the execution, delivery and performance of this Guarantee will not conflict
with, violate or breach the terms of any agreement of Guarantor;

(c) no authorization, approval, consent or order of, or registration or filing
with, any court or other governmental body having jurisdiction over Guarantor is
required on the part of Guarantor for the execution and delivery of this
Guarantee; and

(d) this Guarantee, when executed and delivered, will constitute a valid and
legally binding agreement of Guarantor, except as the enforceability of this
Guarantee may be limited by the effect of any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors’ rights generally
and by general principles of equity as they apply to the Guarantor.

7. Miscellaneous.

(a) This Guarantee shall inure to the benefit of and be binding upon the Parties
hereto and their respective successors and permitted assigns. Neither Party may
assign or transfer this Guarantee or any rights or obligations hereunder without
the other Party’s prior written consent. Notwithstanding the foregoing, this
Guarantee may be assigned by Contractor to the same extent that Contractor is
able to assign the Agreement pursuant to Section 22.7 therein. Except as
provided in this Section 7, nothing herein, express or implied, is intended or
shall be construed to confer upon or to give to any Person other than the
Parties hereto any rights, remedies, or other benefits.

(b) This Guarantee shall be governed by, and construed in accordance with, the
laws of the state of New York except for any choice or conflict of law provision
or rule (whether of the State of New York or any other jurisdiction) other than
Section 5-1401 of the New York General Obligations Law.

(c) The Parties agree that any dispute, controversy or claim (“Dispute”) arising
out of or relating to this Guarantee shall be decided by litigation pursuant to
this Section 7(c). Litigation of any Dispute shall be brought exclusively in a
federal or state court located in New York County in the State of New York. Each
Party hereby consents to personal jurisdiction in any legal action, suit, or
proceeding brought in any federal or state court within New York County in the
State of New York having subject matter jurisdiction and irrevocably waives, to
the fullest extent permitted by Applicable Law and the laws of the State of New
York, any claim or any objection it may now or hereafter have, that venue or
personal jurisdiction is not proper with respect to any such legal action, suit,
or proceeding brought in such a court in the State of New York, including any
claim that such legal action, suit, or proceeding brought in such court has been
brought in an inconvenient forum. Each Party further consents to the service of
process out of any of the aforementioned courts in any such action or proceeding
by the mailing of copies thereof by registered or certified mail, postage
prepaid, to such Party at its address specified herein for the giving of
notices, or by such other notice given in accordance with the rules and
procedures of such courts.

(d) No modification or amendment of this Guarantee shall be of any force or
effect unless made in writing, signed by the Parties hereto, and specifying with
particularity the nature and extent of such modification or amendment. This
Guarantee constitutes the entire and only

 

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understanding and agreement among the Parties hereto with respect to the subject
matter hereof and cancels and supersedes any prior negotiations, proposals,
representations, understandings, commitments, communications, or agreements,
whether oral or written, with respect to the subject matter hereof.

(e) Notice. All notices pertaining to the Agreement shall be in the English
language and signed by a duly authorized representative of the Party giving such
notice, shall reference the Agreement, shall be sent by registered or certified
mail, recognized express courier or facsimile (followed by registered mail) to
the other Party at the address designated below, and shall be effective upon
delivery:

If delivered to Guarantor:

Mirant Corporation

1155 Perimeter Center West

Atlanta, GA 30338

Attn: Chief Financial Officer

Facsimile: (678) 579-5001

with a copy to:

Mirant Corporation

1155 Perimeter Center West

Atlanta, GA 30338

Attn: General Counsel

Facsimile: (678) 579-5951

and

Mirant Marsh Landing, LLC

P.O. Box 192

Pittsburg, CA 94565

Attn: President

Facsimile: (925) 427-3518

If to Contractor:

Kiewit Power Constructors Co.

9401 Renner Blvd.

Lenexa, KS 66219

Attention: Kevin Needham

Fax No.: 913-928-7214

with a copy to:

Kiewit Power Constructors Co.

9401 Renner Blvd.

Lenexa, KS 66219

 

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Attention: Robert Osborn

Phone No.: 913-928-7895

Fax No.: 913-928-7895

or to such other address or telecopy number and with such other copies, as such
Party may hereafter reasonably specify by notice to the other Parties. Each such
notice, request or communication shall be effective upon receipt, provided that
if the day of receipt is not a Business Day then it shall be deemed to have been
received on the next succeeding Business Day.

(f) The headings of the several provisions of this Guarantee are inserted for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Guarantee.

(g) No forbearance or delay by Owner in asserting rights against Contractor
shall affect or impair in any way Guarantor’s obligations hereunder or the
rights of Owner hereunder.

(h) The term “Person” shall mean any individual, company, joint venture,
corporation, partnership, association, joint stock company, limited liability
company, trust, estate, unincorporated organization, governmental entity or
other entity having legal capacity.

(i) This Guarantee may be executed in any number of separate counterparts and
all of said counterparts taken together shall be deemed to constitute one and
the same instrument.

[Signature Page Follows]

 

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IN WITNESS WHEREOF, the undersigned have duly executed this Guarantee as of the
date first above written.

 

MIRANT CORPORATION

By:

 

 

Name:

 

 

Title:

 

 

KIEWIT POWER CONSTRUCTORS CO.

By:

 

 

Name:

 

 

Title:

 

 

Acknowledged:

 

Mirant Marsh Landing, LLC

By:

 

 

Name:

 

 

Title:

 

 

 

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Execution Version

ATTACHMENT AA

DEMOLITION WORK AND DEMOLITION INFORMATION

Contractor shall perform demolition Work and relocation of existing utilities
and underground interferences pursuant to this Attachment AA.

General Scope of the Demolition Work:

 

1.

Contractor shall demolish, excavate, load, remove from the Site and properly
dispose of the existing foundations, concrete structures and other underground
interferences at the Site (to the extent such other interferences have been
identified by Owner either during inspections or in Schedule Y-3 or the drawings
listed below), including the foundations for fuel oil tanks No. 1 through 5,
equipment pads and pipe trenches. Such Work shall include the excavation,
loading, removal and disposal of the sand and gravel matting under the fuel oil
tanks. Drawings and information for the fuel oil tank foundations and other
structures to be demolished and disposed of are provided in Schedule Y-3 and the
drawings listed below.

 

2.

Contractor shall demolish, excavate, load, remove from the Site and properly
dispose of existing concrete and asphalt berms and other secondary containment
structures as necessary for the construction of the Facility and to properly
manage Site drainage. Drawings and information for the berms and other secondary
containment structures are shown in Schedule Y-3 and the drawings listed below.

 

3.

Contractor shall remove and relocate existing utilities at the Site as part of
the demolition Work, including those utilities identified by the drawings and
documents listed below and utilities identified by Contractor in its
investigations as set forth in Section 5.2D of the Agreement. For clarity, all
underground utilities east of the existing Fuel Oil Tanks #2 and #4 (and within
the Site) shall be relocated and remain functional with the exception of the
480v cable runs to and from Load Center #8 (as shown on the Owner-provided
drawings). The impound basin drain lines that run east of the Fuel Oil Tanks #2
and #4 berm (as shown in the Owner-provided drawings) shall be relocated if
necessary. Also, the 3” PVC piping run supplying potable water, running in the
fuel oil piping rack from Fuel Oil Tank #8 to the northeast corner of Fuel Oil
Tank #2 and beyond, shall be removed and relocated. And the 4” PVC conduit
carrying communication cable and running along the fuel oil piping rack from the
northwest corner of Fuel Oil Tank #6 to the northeast corner of Fuel Oil Tank #2
and beyond shall also be removed but shall not be placed back into service by
Contractor. (Owner shall be responsible for installing the new conduit and
communications cable for the Facility; Contractor shall avoid damaging such new
conduit and communications cable during the performance of the Work.) Note: The
Parties acknowledge that the foregoing PVC piping runs are not shown on the
drawings listed herein but have been identified to Contractor. All relocated
utilities shall be returned to proper working order by Contractor.

Interfaces Regarding Loading, Removal and Disposal of Demolished Structures and
Excavated Materials

 

1.

Except as otherwise set forth in this Attachment AA, all demolished structures
and utilities and excavated materials resulting from the demolition Work shall
be loaded, removed from the Site (and relocated, as applicable) and otherwise
properly disposed of by Contractor in accordance with the Agreement.

 

2.

If Contractor encounters pre-existing Hazardous Materials during the performance
of the demolition Work (other than soil, including sand and gravel beneath the
fuel oil tanks, containing oil-based compounds, including corrosion inhibiting
oils), then Contractor shall proceed in accordance with

 

AA-1

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Section 3.17 of the Agreement. After notification by Contractor to Owner of its
encounter with the Hazardous Materials, Owner shall cause such Hazardous
Materials to be remediated, removed from the Site and disposed of in a
reasonably prompt manner.

 

3.

If Contractor encounters soils (including sand and gravel beneath the fuel oil
tanks) containing oil-based compounds (such as corrosion inhibiting oils) during
the performance of the demolition Work, then Contractor will excavate such soil
and load such soil onto Owner-provided trucks for disposal by Owner. If the
amount of excavation necessary to remove this type of soil is greater than one
foot deep of sand and gravel matting, then Contractor shall be entitled to a
Change Order for the additional, direct costs incurred as a result of such
additional excavation.

 

4.

If Contractor encounters any groundwater contaminated by Hazardous Materials and
such contaminated groundwater requires Contractor to provide additional,
unanticipated treatment of such groundwater prior to its release or causes
Contractor to provide temporary storage for such contaminated groundwater (for
Owner’s subsequent treatment and disposal), then Contractor shall be entitled to
a Change Order for the additional, direct costs incurred as a result of such
additional water treatment or provision of temporary storage.

List of Drawings and Related Documents Provided to Contractor for Demolition
Work

The following drawings were provided to Contractor for their review and use in
the evaluation and performance of the demolition Work:

 

Drawing Number

   Revision
Number   

Drawing Title

16432    0   

Requirements for 480V Load Center No. 8

312372    12   

Wiring Diagram - 480 V Switchgear Load Center No. 8 Starter Sections

404033    24   

General Arrangement of Conduits - Outdoors (with annotation)

404326    11   

Arrangement of Grounds 220 KV Switch and Bus Str.

404765    7   

Schematic Diagram 480 V Bus Feeder & Bus Tie A.C.B.’s

404882    24   

General Arrangement of Station Grounding

404026    18   

General Arrangement of Lighting

404109    17   

Oil Fire Protection Equipment Layout and Detail

404110    18   

General Area, Finished Grading

404598    15   

Fire Water Supply System Plan and Detail

404679    9   

Arrangement of Grounds Fuel Oil Tank Area

406301    19   

Utility Plan

426937    13   

Oily Water System

454367    4   

Single Line Diagram 480V Load Center No. 20

469040    1   

Architectural - Plumbing Low Pressure Water System Site Plan, Schedules and
Details (with annotation)

521886    2   

Piping and Mechanical Sections and Details Waste Water Treatment System

53432    8   

General Arrangement of Grounds Elev. 0-9 Areas 16-33

53433    2   

General Arrangement of Grounds Area 1-15 Elev. 0-9

404612    8   

Fuel Oil Storage Tank Area - Plans & Details

404613    11   

Fuel Oil Service & Storage Tanks - Details

404615    1   

Fuel Oil Tankage System - Plot Plan

405374    8   

Fuel Oil Tank Area Grading & Surfacing

 

AA-2

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478888   

7

  

Mechanical - Piping Schematic Fire Protection System

502640   

7

  

Firewater System Plan and Details Fuel Oil Tanks 6, 7, 8

4030480   

9

  

Single Line Diagram Contra Costa Power Plant (Switching Station)

     

Construction Trailer Load Centers

     

Marsh Landing Satellite1

     

Report of Foundation Investigation Proposed Contra Costa Steam Plant (Units 1-3)

     

Excerpts from Foundation Investigation for Contra Costa Units 6 and 7

     

Soil Report (as defined in Section 1.1 of the Agreement)

     

Water Supply and Discharge Pipeline Photos (Mirant Marsh Landing)

 

AA-3

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Execution Version

ATTACHMENT BB

CONFIDENTIALITY OBLIGATIONS FOR SIEMENS CONFIDENTIAL INFORMATION

***

 

BB-1

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Execution Version

ATTACHMENT CC

GROUND WATER SPECIFICATIONS

Water-quality results from samples collected prior to the aquifer test
(MCL-USEPA Maximum Contaminant Level; NSDWR-USEPA National Secondary Drinking
Water Standard).

 

Parameter

   Units   WS-04   WS-05   WS-06   WS-07   WS-09

***

   ***   ***   ***   ***   ***   ***

 

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Water-quality results from samples collected during the aquifer test (MCL-USEPA
Maximum Contaminant Level; NSDWR-USEPA National Secondary Drinking Water
Standard).

 

Parameter

   Units   MCL
(NSDWR)   SJ River
(20.5 hrs)   WS-01
(20 hrs)   WS-04
(21.5 hrs)   TW-01-01
(22 hrs)   TW-01-02
(70 hrs)

***

   ***   ***   ***   ***   ***   ***   ***

 

CC-2