Exhibit 10.1


 


CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS AGREEMENT. THE REDACTIONS ARE
INDICATED WITH FIVE ASTERISKS (“*****”). A COMPLETE VERSION OF THIS AGREEMENT
HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.


 


2009 OMNIBUS AGREEMENT


 


This
2009 OMNIBUS AGREEMENT (this “Agreement”), dated as of November 25, 2009, is
entered into by and among First Wind Energy, LLC (“FWE”), Niagara Wind Power,
LLC (“NWP”), New York Wind, LLC (“NYW”), First Wind Acquisition IV, LLC (“FW A
IV”), and First Wind Acquisition V, LLC (“FWA V”, and together with FWE, NWP,
NYW and FWA IV, collectively, or individually, as applicable, “First Wind”) on
the one hand, and Clipper Windpower, Inc. (“CWI”), Clipper Turbine Works, Inc.
(“CTW”), and Clipper Fleet Services, Inc. (“CFS” and, together with CWI and
CTW, “Clipper”) on the other hand. Each of First Wind and Clipper are sometimes
referred to hereafter as a “Party”, or collectively as the “Parties”.


 


WHEREAS,
First Wind Acquisition II, LLC entered into that certain Turbine Supply
Agreement (“Steel Winds TSA”) and Warranty Agreement (“Steel Winds Warranty
Agreement”) with CTW, each dated as of July 24, 2006, which Steel Winds TSA and
Steel Winds Warranty Agreement were assigned by First Wind Acquisition II, LLC
to Steel Winds Project LLC pursuant to that Assignment and Assumption Agreement
among First Wind Acquisition II, LLC, Steel
Winds Project LLC and CTW dated as of September 1, 2006, which Steel Winds TSA
and Steel Winds Warranty Agreement were further assigned by Steel Winds Project
LLC to NWP in connection with that certain letter dated June 1, 2007 from NWP
to Steel Winds Project LLC notifying Steel Winds Project LLC of NWP’s exercise
of its option to purchase development assets from Steel Winds Project LLC, and
CFS and First Wind O&M, LLC, as successor to UPC New York Wind O&M, LLC
(“First Wind O&M”), entered into that certain Turbine Operation,
Maintenance and Service Agreement dated as of July 24, 2006 (the “Steel Winds
O&M Agreement”, together with the Steel Winds TSA and the Steel Winds
Warranty Agreement, collectively referred to herein as the “Steel Winds Project
Documents”), all relating to the eight (8) Turbine wind project known as the “Steel
Winds Project”.


 


WHEREAS,
CTW and NYW (as successor to First Wind Acquisition III, LLC (“FWA III”)) are
parties to that certain Turbine Supply Agreement (“Cohocton TSA”) and Warranty
Agreement (“Cohocton Warranty”) relating to the fifty (50) Turbine wind project
known as the “Cohocton Project”.


 


WHEREAS,
CTW and FWA V entered into (i) that certain Turbine Supply
Agreement (“2009 TSA”) and Warranty Agreement (“2009 Warranty”) relating to the
purchase of thirty five (35) turbines, (ii) that certain Turbine Supply
Agreement (“2010 TSA”) and Warranty Agreement (“2010 Warranty”) relating to the
purchase of eighty (80) turbines, (iii) that certain Turbine Supply Agreement (“2011
TSA”) and Warranty Agreement (“2011 Warranty”) relating to the purchase of
forty (40) turbines, (iv) that certain Turbine Supply Agreement (“2012 TSA”)
and Warranty Agreement (“2012 Warranty”) relating to the purchase of fifty (50)
turbines and (v) that certain Turbine Supply Agreement (“2013 TSA”) and
Warranty Agreement (“2013 Warranty” and together with the Cohocton Warranty,
the 2009 Warranty, the 2010 Warranty, the 2011 Warranty and the 2012 Warranty,
the “Warranty Agreements”) relating to the purchase of sixty (60) turbines.


 


WHEREAS,
the Steel Winds Project Documents, the Cohocton TSA, the Warranty Agreements,
the 2009 TSA, the 2010 TSA, the 2011 TSA, the 2012 TSA, the 2013 TSA, each as
amended to date, shall be referred to herein as the “Project Documents”.


 

















 


WHEREAS,
on December 31, 2007, Clipper and FWE, NWP, First Wind O&M, FWA III and FWA IV entered into that
certain Settlement and Release Agreement (the “December 2007 Agreement”), on March
24, 2008, Clipper and FWE, NWP, First Wind O&M, FWA III, FWA IV, FWA V,
Canandaigua Power Partners, LLC and Canadaigua Power Partners II, LLC entered
into that certain Agreement (the “March 2008 Agreement”), and on December 30,
2008, Clipper and FWE, NWP, FWA III, FWA IV and FWA V entered into that certain
Omnibus Agreement (the “2008 Omnibus Agreement”, and together with the December
2007 Agreement and the March 2008 Agreement, the “Settlement Agreements”).


 


WHEREAS,
the Parties desire to enter into the following agreements with respect to the
Settlement Agreements, the Project Documents and the Projects.


 


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


 


ARTICLE I


PAYMENTS


 


1.1           Agreements
Regarding 2009 TSA Payment Obligations.


 


(a)           2009 TSA (Hawaii
Turbines).  FWA V and CTW have been
in discussions with respect to twelve (12) Turbines (as defined in the 2009
TSA) contemplated to be delivered with respect to a First Wind project to be
located in Oahu, Hawaii (the “Hawaii Turbines”). As set forth in the new
Payment Schedule to the 2009 TSA attached hereto in Schedule I, FWA V shall,
subject to Section 3.1 herein with respect to the execution and delivery of the
***** (as defined below) into escrow, pay to CTW ***** ($*****)
on December 4, 2009 (the “Contingent Hawaii Turbine Payment”) which payment
shall be applied to the Hawaii Turbines only. Subject to Section 3.1 herein,
the balance of the payments owing with respect to the Hawaii Turbines after the
Contingent Hawaii Turbine Payment is made in the amount of ***** ($*****), plus
any amounts applicable to additional equipment options ordered by FWA V (the “Remaining
Hawaii Turbine Payments”) shall be due and payable to Clipper on March 15, 2010.


 


(b)           2009
TSA (Non-Hawaii Turbines).  With respect to
the other twenty-three (23) Turbines (as defined in the 2009 TSA) subject to
the 2009 TSA (the “Non-Hawaii Turbines”), as set forth in the new Payment
Schedule to the 2009 TSA attached hereto in Schedule I, FWA V’s next payment to
CTW in the amount of ***** ($*****) with respect to the Non-Hawaii Turbines,
shall be due on February 15, 2011.


 


1.2           2010 TSA.


 


(a)           In the event that
Clipper fails to refund to First Wind ***** ($*****) (the “Refund Amount”), if
required pursuant to Section 2.4(c) of the 2008 Omnibus Agreement, on or before
January 10, 2011 (the “Refund Default”), Clipper agrees that the Later Turbines
Payment shall be reduced by


 


2

















 


the amount of the unpaid
Refund Amount, and, pursuant to Section 2.4(c) of the 2008 Omnibus Agreement,
the 2010 TSA shall terminate without any further action of the parties thereto.


 


(b)           The Payment Schedule to the 2010 TSA
is hereby amended and replaced with the new applicable Payment Schedule for the
2010 TSA as set forth in Schedule I. As set forth in
the new Payment Schedule to the 2010 TSA, FWA V’s next payment to CTW under the
2010 TSA in the amount of ***** ($*****) shall be due
on January 15, 2011.


 


1.3           Project Turbine
Availability Warranty Payments and Other Payments.


 


(a)           Steel Winds
Project.  The Parties agree that the
full amount of the Turbine Availability Warranty Payments payable by CTW to NWP
under the Steel Winds Warranty Agreement (i) for the Warranty Period Year ended
May 31, 2008 the remaining payment is ***** (the “Remaining
2008 Warranty Payment”, together with the Warranty Pre-Payment, the “2008
Warranty Payment”) and (ii) for the Warranty Period Year ended May 31, 2009 is
$***** (the “2009 Warranty Payment”). The Remaining 2008
Warranty Payment and the 2009 Warranty Payment shall be paid by CTW to NWP on March
10, 2010. In the event that such amounts are not paid by CTW to NWP, the
Parties agree that FWA V may offset such amounts against the amounts payable by
FWA V to CTW on March 15, 2010 set forth in the Payment Schedule to the 2009
TSA attached hereto in Schedule I. First Wind
acknowledges that it has received to date $***** (the “Warranty
Pre-Payment”) of the Turbine Availability Warranty Payment applicable to the
Warranty Period Year ended May 31, 2008. Furthermore, the Parties agree that
pursuant Section 1.3(b) of the 2008 Omnibus Agreement only $***** of the 2008
Warranty Payment shall be deemed to have been made for purposes of calculating
the limitations of liability with respect to the Turbine Availability Warranty
Payments and the aggregate amount of liquidated damages payable under Section 7.2
of the Steel Winds Warranty Agreement.


 


(b)           Cohocton Project.  The Parties agree that the full amount of the
Turbine Availability Warranty Payments payable by CTW to NYW under the Cohocton
Warranty for the first six months of the current Warranty Period Year is ***** ($*****) (the “First
Half Warranty Payments”). The First Half Warranty Payments, as well as any
undisputed additional Turbine Availability Warranty Payment amounts payable
under the Cohocton Warranty for the last six months of this current Warranty
Period Year, shall be paid by CTW to NYW on March 10, 2010. In the event that
such amounts are not paid by CTW to NYW, the Parties agree that FWA V may
offset such amounts against the amounts payable by FWA V to CTW on March 15, 2010
set forth in the Payment Schedule to the 2009 TSA attached hereto in Schedule I.


 


1.4           2011 TSA, 2012
TSA and 2013 TSA.


 


(a)           With respect to the ***** ($*****) in the
aggregate already paid through the date of this Agreement by FWA V under the
2011 TSA, the 2012 TSA and the 2013 TSA (the “Prior Payments”), the Parties
agree that such Prior Payments shall be re-allocated such that two-thirds of
the Prior Payments shall be allocated with respect to all forty (40) of the
Turbines under the 2011 TSA


 


3

















 


and with respect to
thirty-five (35) of the Turbines under the 2012 TSA, on a pro rata basis. The
remaining one-third of the Prior Payments shall be allocated to fifteen (15)
Turbines under the 2012 TSA and to all sixty (60) Turbines under the 2013 TSA,
on pro rata basis. The Payment Schedules to the 2011 TSA, the 2012 TSA and the
2013 TSA are hereby amended and replaced with the new applicable Payment
Schedule reflecting the reallocation of payments described in this Section 1.4(a)
as set forth in Schedule I.


 


(b)           The Parties agree that upon request
from Clipper, the 2009 TSA, the 2010 TSA, the 2011 TSA, the 2012 TSA, the 2013 TSA
and the Turbine Supply Agreement relating to the sixteen (16) Turbine project
entered into between CTW and FWA IV (the “Sheffield TSA”), shall be amended (or
amended and restated, as may be agreed upon by the Parties) by removing the
commissioning and completion obligations of Clipper (and the corresponding
milestone payment obligations of First Wind) from such Project Documents and
separate commissioning services agreements, in form and substance reasonably
satisfactory to the Parties, shall be executed with respect to the applicable
Project Documents. The Purchase Price and Payment Schedules under each
applicable Project Document shall be adjusted accordingly and such prices and
payments shall be reflected in the commissioning services agreement entered
into with respect to such Project Document.


 


(c)           Subject to Section 1.2(a) above, on January
15, 2011, First Wind shall make a payment of ***** (the “Later Turbines Payment”)
to Clipper in respect of the 2011 TSA, the 2012 TSA and the 2013 TSA (collectively,
the “Later TSAs”). Such payment shall be applied pro rata to each such Project
Document as reflected in the Payment Schedules for each such Project Document
set forth in Schedule I such that two-thirds of the Later Turbines Payments
shall be allocated with respect to all forty (40) of the Turbines to be
delivered under the 2011 TSA and with respect to the first thirty-five (35) of
the Turbines under the 2012 TSA scheduled to be delivered, on a pro rata basis.
The remaining one-third of the Later Turbines Payments shall be allocated to
the last fifteen (15) Turbines to be delivered under the 2012 TSA and to all
sixty (60) Turbines to be delivered under the 2013 TSA, on a pro rata basis.


 


1.5           Turbine Payments.  Each Payment Schedule to the 2009 TSA, the 2010
TSA, the 2011 TSA, the 2012 TSA and the 2013 TSA is hereby amended and replaced
with the new applicable Payment Schedule for such Project Document set forth in
Schedule I. The payments contemplated in Schedule I are required to be made by
First Wind only upon the satisfaction of the relevant milestones and in
accordance with the terms and conditions set forth in each applicable Project
Document.


 


ARTICLE II


PROJECT DOCUMENT AND PROJECT OBLIGATIONS


 


2.1           ***** through December 31, 2010.
Notwithstanding the right of First Wind under the applicable Project Documents *****
pursuant to the terms of such Project Documents (e.g., pursuant to Section 14.6
of the 2009 TSA and Exhibit G thereto), First Wind agrees that it shall not
exercise any such rights under any Project Document on or before December 31,
2010; provided, that, the parties acknowledge and agree that this prohibition
on the exercise of rights under the applicable


 


4

















 


***** provisions
under the Project Documents does not affect the parties’ remaining rights and
obligations under the applicable Project Documents.. After December 31, 2010,
First Wind shall have the right to exercise the ***** provisions set
forth in Section 14.6 or 14.7 (including the application of Exhibit G *****, as
applicable, in each applicable Project Document) taking into account the new
Delivery Schedule for the Turbines under each applicable Project Schedule set
forth in Schedule II.


 


2.2           2009 TSA.  The Delivery Schedule set forth in Exhibit L
to the 2009 TSA is hereby amended and replaced with the new Delivery Schedule
for the 2009 TSA set forth in Schedule II..


 


2.3           2010 TSA.  After December 31, 2010 and on or before January
15, 2011, First Wind shall have the right to ***** the purchase
of any Turbine pursuant to Section 14.6 
of the 2010 TSA, and no further ***** shall be
required in connection with an exercise of such *****.  In the event that First Wind does not
exercise its ***** pursuant to Section 14.6  of the 2010 TSA prior to January 15, 2011,
First Wind and Clipper shall agree upon the Delivery Schedule with respect to
the Turbines under the 2010 TSA based upon the delivery periods then available
as provided by Clipper.  Upon the
agreement between the Parties with respect to the Delivery Schedule for the
Turbines under the 2010 TSA, the milestone payment due dates in the Payment
Schedule for the 2010 TSA shall be adjusted accordingly, if required.


 


2.4           2011 TSA, 2012
TSA and 2013 TSA.


 


(a)           The Delivery
Schedule set forth in Exhibit L to each of the 2011 TSA, the 2012 TSA and the
2013 TSA is hereby amended and replaced with the new Delivery Schedule
applicable to each respective Project Document set forth in Schedule II.


 


(b)           The ***** set forth in Exhibit G to
each of the 2011 TSA, the 2012 TSA and the 2013 TSA is hereby, upon the payment
of the Later Turbines Payment (including payment of such amount taking into
account the reduction of the Refund Amount pursuant to Section 1.2(b)), amended
as follows: (i) no further ***** shall be required in connection with an
exercise of the ***** pursuant to Section 14.7 of
the applicable Later TSA up until twelve (12) months prior to the first date of
Delivery of the first Major Turbine Component (as compared to ***** for the period
between fifteen (15) and twelve (12) months prior to the first date of Delivery
of the first Major Turbine Component (as set forth in the ***** prior to this
amendment)) and (ii) no further ***** shall be required in connection with an
exercise of the ***** pursuant to Section 14.7 of
the 2011 TSA until January 15, 2011.


 


ARTICLE III


ADDITIONAL AGREEMENTS


 


3.1           Condition Precedent to Hawaii
Turbine Payments.  If a Strategic
Investment (as defined in Schedule III attached hereto) in Clipper has
not been announced by December 4, 2009, *****, CWI shall have deposited into
escrow with a


 


5

















 


mutually acceptable escrow
agent (the “Escrow Agent”) the following: ***** For each day
after December 4, 2009 that the ***** has not been
placed into escrow, FWA V’s obligation *****. 
FWA V shall ***** on the day immediately following the day the ***** is placed in
escrow.  For the avoidance of doubt,
Clipper’s obligation to Deliver the Hawaii Turbines shall not be excused or
delayed as a result of Clipper’s delay in making an announcement of the
Strategic Investment or a delay in the delivery into escrow of the ***** *****, in each
case by December 4, 2009.


 


3.2           Release of *****.  The escrow agreement governing the
maintenance and release of ***** shall provide for the release of the *****
pursuant to the terms set forth on Schedule IV attached hereto (subject
to requirements of the Escrow Agent).


 


3.3           Termination of Agreement.  In the event that (a) the ***** is not
finalized and deposited with the Escrow Agent and (b) the ***** is not made, in
each case, on or before December 10, 2009, provided that Clipper has provided
written confirmation reasonably satisfactory to First Wind providing First Wind
(i) ***** and (ii) the right to defer the *****, in each
case, through December 17, 2009 (and with at least 7 days to ***** and defer *****
after the receipt of such written confirmation),*****


 


3.4           Payment Schedules and Delivery
Schedules.  The Parties agree that
the Payment Schedule and Delivery Schedule attached to this Agreement shall be
revised to be consistent with the format of such schedules (the “Revised
Schedules”) as previously set forth in the applicable Project Documents.  Clipper shall use commercially reasonable
efforts to provide to First Wind the Revised Schedules within 15 days after the
execution of this Agreement.


 


ARTICLE IV


REPRESENTATIONS AND WARRANTIES


 


4.1           Representations of all Parties.  Each Party represents and warrants to the
other Parties that (a) such Party is an organization duly organized, validly
existing and in good standing under the laws of the state of its organization
and is qualified to do business in each jurisdiction it is required to be by
applicable law, (b) the execution, delivery and performance of this Agreement
by such Party has been duly authorized by all necessary corporate or limited
liability company action, as applicable, on the part of such Party and does not
and will not require the consent of any trustee or holder of any indebtedness or
other obligation of such Party


 


6

















 


or any other party to any
other agreement with such Party other than any consents already obtained, (c) this
Agreement has been duly executed and delivered by such Party and constitutes
the legal, valid and binding obligation of such Party enforceable against it in
accordance with its terms, except to the extent limited by bankruptcy,
insolvency or other similar laws relating to the rights of creditors, or by
general principles of equity, and (d) no governmental authorization, approval,
order, license, permit, franchise or consent, and no registration, declaration
or filing with any governmental authority is required on the part of such Party
in connection with the execution, delivery or performance of this Agreement.


 


ARTICLE V


MISCELLANEOUS


 


5.1           Entire Agreement; Defined Terms.  This Agreement contains the entire
understanding of the Parties relating to the subject matter hereof and
supersedes all prior written or oral and all contemporaneous oral agreements
and understandings relating to the subject matter hereof.  Any terms not otherwise defined in this
Agreement shall have the meaning as defined in the Project Documents.  Except as amended hereby, all the terms and
conditions in all Project Documents shall remain in full force and effect.  Each Party agrees to keep the terms and
provisions of this Agreement and all materials and information that each Party
receives pursuant hereto or in connection herewith in the
strictest confidence and not to disclose any of the foregoing to any party
other than the respective lenders, investors, potential lenders or investors,
attorneys, accountants, affiliates, officers and directors of each Party or as
such Party may be required by law, court order or in any litigation to
disclose.


 


5.2           No Third Party Beneficiary.  This Agreement is made for the sole benefit
of the Parties hereto and their respective successors, executors and permitted
assigns, and nothing contained herein, express or implied, is intended to or
shall confer upon any other person any third-party  beneficiary right or any other legal or
equitable rights, benefits or remedies of any nature whatsoever under or by
reason of this Agreement.


 


5.3           Governing Law.  This Agreement will be governed by and
construed and interpreted in accordance with the substantive laws of the State
of New York, without giving effect to any choice of law or conflicts of law
provision or rule that would cause the application of the laws of a jurisdiction
other than New York.


 


5.4           Neutral Construction.  The Parties hereto agree that this Agreement
was negotiated fairly between them at arms’ length and that the final terms of
this Agreement are the product of the Parties’ negotiations.  Each party represents and warrants that it
has sought and received legal counsel of its own choosing with regard to the
contents of this Agreement and the rights and obligations affected hereby.  The Parties hereto agree that this Agreement
shall be deemed to have been jointly and equally drafted by them, and that no
provisions of this Agreement should be construed against either party on the
grounds that such party drafted or was more responsible for drafting such
provision.


 


5.5           Severability.  In the event that any one or more of the
provisions or parts of a provision contained in this Agreement shall for any
reason be held to be invalid, illegal or unenforceable in any respect in any
jurisdiction, such invalidity, illegality or unenforceability


 


7

















 


shall not affect any other
provision or part of a provision of this Agreement or any other jurisdiction,
but this Agreement shall be reformed and construed in any such jurisdiction as
if such invalid or illegal or unenforceable provision or part of a provision
had never been contained herein and such provision or part shall be reformed so
that it would be valid, legal and enforceable to the maximum extent permitted
in such jurisdiction, provided that any such reform or construction does
not affect the economic or legal substance of the transactions contemplated
hereby in a manner adverse to any party.


 


5.6           Heading; Construction.  The descriptive headings of the Articles and
Sections of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.


 


5.7           Expenses.  Each party shall be responsible for the
payment of its own costs and expenses (including reasonable attorneys’ fees) in
connection with the preparation, execution and delivery of this Agreement.  Nevertheless, in any action or proceeding to
enforce this Agreement, the prevailing party shall be entitled to payment of
its reasonable costs and expenses (including reasonable attorneys’ fees).


 


5.8           Counterparts.  This Agreement may be executed in one or more
counterparts for the convenience of the Parties hereto, each of which shall be
deemed an original and all of which together will constitute one and the same
instrument.  This Agreement shall be
effective upon delivery of original signature pages or facsimile or electronic
mail copies thereof.


 


5.9           Further Actions.  Upon the terms and subject to the conditions
set forth in this Agreement, the Parties hereto shall each use their respective
commercially reasonable efforts to take, or cause to be taken, all appropriate
action, and to do, or cause to be done, and to assist and cooperate with the
other Parties hereto in doing, all things necessary, proper or advisable under
applicable laws to consummate the transactions contemplated hereby.  First Wind and Clipper shall, from time to
time after the delivery and execution of this Agreement, at the request of
either Party, execute and deliver stand-alone agreements or amendments as the
requesting Party may reasonably request to evidence the agreement or agreements
made under this Agreement with respect to a particular Project Document or
particular Project Documents.  In
connection with, and promptly following the execution of, this Agreement, the
parties have agreed to execute the following stand-alone amendments: an
amendment to the Sheffield TSA and to the turbine supply agreement applicable
to the six turbines delivered for the Milford wind project and planned for
installation during 2010, to provide for separate commissioning obligations.


 


5.10         Dispute Resolution.  Any controversy, claim or dispute between the
Parties arising out of or related to this Agreement which cannot be settled
amicably by the Parties, shall be submitted for binding arbitration in
accordance with the provisions contained herein and in accordance with the
Commercial Arbitration Rules of the American Arbitration Association (“Rules”).
Judgment upon the award rendered by the arbitrator may be entered in any court
having jurisdiction.  The arbitrator
shall determine all questions of fact and law relating to any controversy,
claim or dispute hereunder, including but not limited to whether or not any
such controversy, claim or dispute is subject to the arbitration provisions
contained herein.  Any Party desiring
arbitration shall serve on the other Party and the New York Office of the
American Arbitration Association, in accordance with the Rules, its Notice of
Intent to Arbitrate (“Notice”). The Parties shall agree on an arbitrator, and
if the Parties cannot agree upon an


 


8

















 


arbitrator within ten (10) days
after the date of the Notice, the arbitrator shall be selected in accordance
with the Rules. The arbitration proceedings are hereby declared to be
self-executing, and it shall not be necessary to petition a court to compel
arbitration. All arbitration proceedings shall be held in New York, New York.
The Parties agree to bear their own costs associated with any required travel
to and from New York. Notice of the demand for arbitration shall be filed in
writing with the other Party to this Agreement and with the American
Arbitration Association. The demand for arbitration shall be made within a
reasonable time after the controversy, claim or dispute has arisen, and in no
event shall it be made after the date when institution of legal or equitable
proceedings based on such claim, dispute or other matter in question would be
barred by the applicable statutes of limitations.


 


9

















 


IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date
first written above.


 


	
  CLIPPER TURBINE WORKS, INC.

  	
   

  	
  CLIPPER FLEET SERVICES, INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Robert Gates

  	
   

  	
  By: 

  	
  /s/ Robert Gates

  
	
  Name: 

  	
  Robert Gates

  	
   

  	
  Name: 

  	
  Robert Gates

  
	
  Title: 

  	
  Senior Vice President

  	
   

  	
  Title: 

  	
  Senior Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CLIPPER WINDPOWER, INC.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Robert Gates

  	
   

  	
   

  	
   

  
	
  Name: 

  	
  Robert Gates

  	
   

  	
   

  	
   

  
	
  Title: 

  	
  Senior Vice President

  	
   

  	
   

  	
   

  



 


[Signature Page to Agreement]


 

















 


	
  NEW YORK WIND, LLC

  	
   

  	
  FIRST WIND ACQUISITION IV,
  LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Michael Alvarez

  	
   

  	
  By: 

  	
  /s/ Michael Alvarez

  
	
  Name: 

  	
  Michael Alvarez

  	
   

  	
  Name: 

  	
  Michael Alvarez

  
	
  Title: 

  	
  Vice President

  	
   

  	
  Title: 

  	
  : Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FIRST WIND ACQUISITION V, LLC

  	
   

  	
  FIRST WIND ENERGY, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By: 

  	
  /s/ Michael Alvarez

  	
   

  	
  By: 

  	
  /s/ Michael Alvarez

  
	
  Name: 

  	
  Michael Alvarez

  	
   

  	
  Name: 

  	
  Michael Alvarez

  
	
  Title: 

  	
  Vice President

  	
   

  	
  Title: 

  	
  Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  NIAGARA WIND POWER, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By: 

  	
  /s/ Michael Alvarez

  
	
   

  	
   

  	
   

  	
  Name: 

  	
  Michael Alvarez

  
	
   

  	
   

  	
   

  	
  Title: 

  	
  Vice President

  



 


[Signature Page to Agreement]


 















 


Schedule
I


 


PAYMENT
SCHEDULE


 


	
   

  	
   

  	
   

  	
   

  	
  Purchase Price

  	
   

  	
   

  	
   

  
	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  	
   

  
	
  2009
  Hawaii Turbines - C96

  	
   

  	
  12

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
									



 


	
  Milestone

  	
   

  	
  Approximate

  Months prior to

  Delivery of first

  Major Turbine

  Component

  	
   

  	
  Payment Due Date

  	
   

  	
  % of

  Purchase

  Price

  	
   

  	
  Cumulative % of

  Purchase Price

  	
   

  	
  Payment Amount

  (thousands)

  	
   

  	
   

  	
   

  
	
  Down Payment

  	
   

  	
   

  	
   

  	
  December 31, 2007

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  March 14, 2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
  12

  	
   

  	
  June 13, 2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #3

  	
   

  	
  6

  	
   

  	
  December 4, 2009

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #4

  	
   

  	
  6

  	
   

  	
  December 4, 2009

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Progress Payment #5

  	
   

  	
   

  	
   

  	
  March 15, 2010

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Calendar Date Payment per Section 1.1 (a) of 2009
  Omnibus Agreement

  	
   

  
	
  Progress Payment #6 - *****

  	
   

  	
   

  	
   

  	
  August 9, 2010

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due upon
  completion of milestone

  	
   

  
	
  Progress Payment #7 - *****

  	
   

  	
   

  	
   

  	
  July 5, 2010

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  



 


Notes


*****


 


EXHIBIT
B2 

PAYMENT SCHEDULE


 


	
   

  	
   

  	
   

  	
   

  	
  Purchase Price

  	
   

  	
   

  	
   

  
	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  	
   

  
	
  2009 Non-Hawaii Turbines - C96

  	
   

  	
  23

  	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase
  Price to be adjusted by CCI as described in Exhibit B1

  	
   

  
									



 


	
  Milestone

  	
   

  	
  Approximate

  Months prior to

  Delivery of first

  Major Turbine

  Component

  	
   

  	
  Payment Due Date

  	
   

  	
  % of

  Purchase

  Price

  	
   

  	
  Cumulative % of

  Purchase Price

  	
   

  	
  Payment Amount

  (thousands)

  	
   

  	
   

  	
   

  
	
  Down Payment

  	
   

  	
   

  	
   

  	
  December 31, 2007

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  March 14, 2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
   

  	
   

  	
  June 13, 2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #3 

  	
   

  	
   

  	
   

  	
  February 15, 2011 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Calendar Date Payment per Section 1.1 (b) of
  2009 Omnibus Agreement 

  	
   

  
	
  Progress Payment #4 - *****

  	
   

  	
   

  	
   

  	
  September 19, 2011 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone 

  	
   

  
	
  Progress Payment #5 - *****

  	
   

  	
   

  	
   

  	
  November 28, 2011 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone 

  	
   

  
	
  Progress Payment #6 - *****

  	
   

  	
   

  	
   

  	
  January 2, 2012 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  



 


Notes


*****


 















 


PAYMENT
SCHEDULE


 


2010 TSA Turbines - C96


 


Deliveries shown in March of
following year for illustration purposes only;


Actual Delivery Schedule
subject to “*****” per Section 2.4 (b) of 2008 Omnibus Agreement:


2011A Turbines: ***** after “*****”


2012A Turbines: ***** after “*****”


2011A Turbines: ***** after “*****”


 


Delivery Schedule subject to
available Delivery periods as provided by Clipper per Section 2.3 of 2009
Omnibus Agreement; Payment Schedules to be shifted accordingly


 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Purchase Price

  	
   

  	
   

  
	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2011A Turbines - C96

  	
   

  	
  40

  	
   

  	
   $

  	
  *****

  	
   

  	
  Purchase Price to be adjusted by
  CCI as described in Exhibit B1

  
										



 


	
   

  	
   

  	
  Approximate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Months prior to

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Delivery of first

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Major Turbine

  	
   

  	
   

  	
   

  	
  Purchase

  	
   

  	
  Cumulative % of

  	
   

  	
  Payment Amount

  	
   

  	
   

  
	
  Milestone

  	
   

  	
  Component

  	
   

  	
  Payment Due Date

  	
   

  	
  Price

  	
   

  	
  Purchase Price

  	
   

  	
  (thousands)

  	
   

  	
   

  
	
  Down Payment

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Progress Payment #3

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Additional Credit

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Progress Payment #4

  	
   

  	
   

  	
   

  	
  January 15, 2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Calendar Date Payment per Section 1.2 (b) of
  2009 Omnibus Agreement

  
	
  Progress Payment #5

  	
   

  	
  6

  	
   

  	
  September 12, 2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due 6
  months prio to Delivery of first Major Turbine Component

  
	
  Progress Payment #6 - *****

  	
   

  	
   

  	
   

  	
  March 12, 2012 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone; 

  Delivery of First Major Turbine Component ***** “*****” as per Section 2.4 (b) of
  2008 Omnibus Agreement 

  
	
  Progress Payment #7 - *****

  	
   

  	
   

  	
   

  	
  May 21, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  
	
  Progress Payment #8 - *****

  	
   

  	
   

  	
   

  	
  June 25, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  



 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Purchase Price

  	
   

  	
   

  
	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2012A Turbines - C96

  	
   

  	
  30

  	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase Price to be adjusted by
  CCI as described in Exhibit B1

  
										



 


	
   

  	
   

  	
  Approximate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Months prior to

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Delivery of first

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Major Turbine

  	
   

  	
   

  	
   

  	
  Purchase

  	
   

  	
  Cumulative % of

  	
   

  	
  Payment Amount

  	
   

  	
   

  
	
  Milestone

  	
   

  	
  Component

  	
   

  	
  Payment Due Date

  	
   

  	
  Price

  	
   

  	
  Purchase Price

  	
   

  	
  (thousands)

  	
   

  	
   

  
	
  Down Payment

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Additional Credit

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  
	
  Progress Payment #3

  	
   

  	
  12

  	
   

  	
  March 18, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due 12
  months prio to Delivery of first Major Turbine Component

  
	
  Progress Payment #4

  	
   

  	
  6

  	
   

  	
  September 18, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due 6
  months prio to Delivery of first Major Turbine Component

  
	
  Progress Payment #5 - *****

  	
   

  	
   

  	
   

  	
  March 18, 2013 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone; 

  Delivery of First Major Turbine Component *****
  after “*****” as per Section 2.4 (b) of 2008 Omnibus Agreement 

  
	
  Progress Payment #7 - *****

  	
   

  	
   

  	
   

  	
  May 27, 2013

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  
	
  Progress Payment #7 - *****

  	
   

  	
   

  	
   

  	
  July 1, 2013

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  



 















 


PAYMENT SCHEDULE


 


	
   

  	
   

  	
   

  	
   

  	
  Purchase
  Price

  	
   

  	
   

  	
   

  
	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  	
   

  
	
  2013A Turbines - C96

  	
   

  	
  10

  	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase
  Price to be adjusted by CCI as described in Exhibit B1

  	
   

  
									



 


	
  Milestone

  	
   

  	
  Approximate

  Months
  prior to

  Delivery
  of first

  Major
  Turbine

  Component

  	
   

  	
  Payment
  Due Date

  	
   

  	
  % of

  Purchase

  Price

  	
   

  	
  Cumulative
  % of

  Purchase
  Price

  	
   

  	
  Payment
  Amount

  (thousands)

  	
   

  	
   

  	
   

  
	
  Down Payment

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #3 

  	
   

  	
  12

  	
   

  	
  March 17, 2013

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due 12
  months prior to Delivery of first Major Turbine Component

  	
   

  
	
  Progress Payment #4 

  	
   

  	
  6

  	
   

  	
  September 17, 2013

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due 6
  months prior to Delivery of first Major Turbine Component

  	
   

  
	
  Progress Payment #5 - *****

  	
   

  	
   

  	
   

  	
  March 17, 2014

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone; 

  Delivery of First Major Turbine Component *****
  after “*****” as per Section 2.4 (b) of 2008 Omnibus Agreement

  	
   

  
	
  Progress Payment #6 - *****

  	
   

  	
   

  	
   

  	
  May 26, 2014

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
  Progress Payment #7 - *****

  	
   

  	
   

  	
   

  	
  June 30, 2014

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  



 


Notes


*****


 


PAYMENT SCHEDULE


 


	
   

  	
   

  	
   

  	
   

  	
  Purchase Price

  	
   

  	
   

  	
   

  
	
  Project
  and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  	
   

  
	
  2011 Turbines - C96

  	
   

  	
   

  	
   

  	
  10

  	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase Price to be adjusted by CCI as described in
  Exhibit B1

  	
   

  
											



 


	
  Milestone

  	
   

  	
  Approximate

  Months
  prior to

  Delivery
  of first

  Major
  Turbine

  Component

  	
   

  	
  Payment
  Due Date

  	
   

  	
  % of

  Purchase

  Price

  	
   

  	
  Cumulative % of

  Purchase Price

  	
   

  	
  Payment Amount

  (thousands)

  	
   

  	
   

  	
   

  
	
  Down
  Payment

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress
  Payment #1

  	
   

  	
   

  	
   

  	
  January 15,
  2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress
  Payment #2

  	
   

  	
   

  	
   

  	
  January 15,
  2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress
  Payment #3

  	
   

  	
  6

  	
   

  	
  February 28,
  2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress
  Payment #4 - *****

  	
   

  	
   

  	
   

  	
  August 29,
  2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
  Progress
  Payment #5 - *****

  	
   

  	
   

  	
   

  	
  November 7,
  2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
  Progress
  Payment #6 - *****

  	
   

  	
   

  	
   

  	
  December 12,
  2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  



 


Notes


*****


 















 


	
   

  	
   

  	
   

  	
   

  	
  Purchase Price

  	
   

  	
   

  	
   

  
	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2012
  Turbines - C96

  	
   

  	
  20

  	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase Price to be adjusted by
  CCI as described in Exhibit B1

  	
   

  
									



 


	
   

  	
   

  	
  Approximate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Months prior to

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Delivery of first

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Major Turbine

  	
   

  	
   

  	
   

  	
  Purchase

  	
   

  	
  Cumulative % of

  	
   

  	
  Payment Amount

  	
   

  	
   

  	
   

  
	
  Milestone

  	
   

  	
  Component

  	
   

  	
  Payment Due Date

  	
   

  	
  Price

  	
   

  	
  Purchase Price

  	
   

  	
  (thousands)

  	
   

  	
   

  	
   

  
	
  Down Payment

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  January 15, 2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
  12

  	
   

  	
  August 27, 2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #3

  	
   

  	
  6

  	
   

  	
  February 27, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #4 - *****

  	
   

  	
   

  	
   

  	
  August 27, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
  Progress Payment #5 - *****

  	
   

  	
   

  	
   

  	
  November 5, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due upon
  completion of milestone

  	
   

  
	
  Progress Payment #6 - *****

  	
   

  	
   

  	
   

  	
  December 10, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due upon
  completion of milestone

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  



 


Notes


*****


*****


*****


PAYMENT SCHEDULE


 


	
   

  	
   

  	
   

  	
   

  	
  Purchase Price

  	
   

  	
   

  	
   

  
	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
  (thousands)

  	
   

  	
  Notes

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2013 Turbines - C96

  	
   

  	
  20

  	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase
  Price to be adjusted by CCI as described in Exhibit B1

  	
   

  
									



 


	
   

  	
   

  	
  Approximate

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Months prior to

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Delivery of first

  	
   

  	
   

  	
   

  	
  % of

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Major Turbine

  	
   

  	
   

  	
   

  	
  Purchase

  	
   

  	
  Cumulative % of

  	
   

  	
  Payment Amount

  	
   

  	
   

  	
   

  
	
  Milestone

  	
   

  	
  Component

  	
   

  	
  Payment Due Date

  	
   

  	
  Price

  	
   

  	
  Purchase Price

  	
   

  	
  (thousands)

  	
   

  	
   

  	
   

  
	
  Down Payment

  	
   

  	
   

  	
   

  	
  Paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  January 15, 2011

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
  12

  	
   

  	
  September 2, 2012

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #3

  	
   

  	
  6

  	
   

  	
  March 2, 2013

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress Payment #6 - *****

  	
   

  	
   

  	
   

  	
  September 2, 2013

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due
  upon completion of milestone

  	
   

  
	
  Progress Payment #7 - *****

  	
   

  	
   

  	
   

  	
  November 11, 2013 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due upon
  completion of milestone 

  	
   

  
	
  Progress Payment #8 - *****

  	
   

  	
   

  	
   

  	
  December 16, 2013 

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  Payment Due Date is estimated, actual payment due upon
  completion of milestone 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  



 


Notes


*****


*****


*****


 















 


Schedule
II


 


Schedules
below assume standard C96, 80m tower unless by modified by Change Order


 


First Wind - 2009 Hawaii Component Availability
Schedule - 12 Turbines


 


12 total: 3 per week, weeks
23 through week 26 of 2010


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Mar-10

  	
   

  	
  April

  	
   

  	
  May

  	
   

  	
  June

  	
   

  	
  July

  	
   

  	
  August

  	
   

  	
  September

  
	
  Week #

  	
   

  	
  10

  	
   

  	
  11

  	
   

  	
  12

  	
   

  	
  13

  	
   

  	
  14

  	
   

  	
  15

  	
   

  	
  16

  	
   

  	
  17

  	
   

  	
  18

  	
   

  	
  19

  	
   

  	
  20

  	
   

  	
  21

  	
   

  	
  22

  	
   

  	
  23

  	
   

  	
  24

  	
   

  	
  25

  	
   

  	
  26

  	
   

  	
  27

  	
   

  	
  28

  	
   

  	
  29

  	
   

  	
  30

  	
   

  	
  31

  	
   

  	
  32

  	
   

  	
  33

  	
   

  	
  34

  	
   

  	
  35

  	
   

  	
  36

  	
   

  	
  37

  	
   

  	
  38

  	
   

  	
  39

  	
   

  	
  40

  
	
  Date

  	
   

  	
  3/1

  	
   

  	
  3/8

  	
   

  	
  3/15

  	
   

  	
  3/22

  	
   

  	
  3/29

  	
   

  	
  4/5

  	
   

  	
  4/12

  	
   

  	
  4/19

  	
   

  	
  4/26

  	
   

  	
  5/3

  	
   

  	
  5/10

  	
   

  	
  5/17

  	
   

  	
  5/24

  	
   

  	
  5/31

  	
   

  	
  6/7

  	
   

  	
  6/14

  	
   

  	
  6/21

  	
   

  	
  6/28

  	
   

  	
  7/5

  	
   

  	
  7/12

  	
   

  	
  7/19

  	
   

  	
  7/26

  	
   

  	
  8/2

  	
   

  	
  8/9

  	
   

  	
  8/16

  	
   

  	
  8/23

  	
   

  	
  8/30

  	
   

  	
  9/6

  	
   

  	
  9/13

  	
   

  	
  9/20

  	
   

  	
  9/27

  
	
  Deliveries
  per Week

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


First Wind - 2009 Non-Hawaii Component Availability
Schedule - 23 Turbines


 


23 total: 3 per week, weeks
36 through week 43 of 2011


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jun-11

  	
   

  	
  Jul-11

  	
   

  	
  Aug-11

  	
   

  	
  Sep-11

  	
   

  	
  Oct-11

  	
   

  	
  Nov-11

  	
   

  	
  Dec-11

  
	
  Week #

  	
   

  	
  23

  	
   

  	
  24

  	
   

  	
  25

  	
   

  	
  26

  	
   

  	
  27

  	
   

  	
  28

  	
   

  	
  29

  	
   

  	
  30

  	
   

  	
  31

  	
   

  	
  32

  	
   

  	
  33

  	
   

  	
  34

  	
   

  	
  35

  	
   

  	
  36

  	
   

  	
  37

  	
   

  	
  38

  	
   

  	
  39

  	
   

  	
  40

  	
   

  	
  41

  	
   

  	
  42

  	
   

  	
  43

  	
   

  	
  44

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  53

  
	
  Date

  	
   

  	
  5/30

  	
   

  	
  6/6

  	
   

  	
  6/13

  	
   

  	
  6/20

  	
   

  	
  6/27

  	
   

  	
  7/4

  	
   

  	
  7/11

  	
   

  	
  7/18

  	
   

  	
  7/25

  	
   

  	
  8/1

  	
   

  	
  8/8

  	
   

  	
  8/15

  	
   

  	
  8/22

  	
   

  	
  8/29

  	
   

  	
  9/5

  	
   

  	
  9/12

  	
   

  	
  9/19

  	
   

  	
  9/26

  	
   

  	
  10/3

  	
   

  	
  10/10

  	
   

  	
  10/17

  	
   

  	
  10/24

  	
   

  	
  10/31

  	
   

  	
  11/7

  	
   

  	
  11/14

  	
   

  	
  11/21

  	
   

  	
  11/28

  	
   

  	
  12/5

  	
   

  	
  12/12

  	
   

  	
  12/19

  	
   

  	
  12/26

  
	
  Deliveries
  per Week

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


First Wind - 2010 deferred to 2011-2013 Component
Availability Schedule (further described in 2.4 of 2008 Omnibus Agreement) - 80
Turbines


 


2011A  Turbines - 40 Total


Delivery of First Major Turbine Component *****” as per Section 2.4
(b) of 2008 Omnibus Agreement


Subject to available Delivery periods as provided by Clipper
per Section 2.3 of 2009 Omnibus Agreement


 


2012A  Turbines - 30 Total


Delivery of First Major Turbine Component *****” as per Section 2.4
(b) of 2008 Omnibus Agreement


Subject to available Delivery periods as provided by Clipper
per Section 2.3 of 2009 Omnibus Agreement


 


2013A  Turbines - 10 Total


Delivery of First Major Turbine Component *****” as per Section 2.4
(b) of 2008 Omnibus Agreement


Subject to available Delivery periods as provided by Clipper
per Section 2.3 of 2009 Omnibus Agreement


 


First Wind - 2011 Component Availability Schedule - 10
Turbines


 


10 total; 4 per week starting
week 36 through week 38 of 2011


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jun-11

  	
   

  	
  Jul-11

  	
   

  	
  Aug-11

  	
   

  	
  Sep-11

  	
   

  	
  Oct-11

  	
   

  	
  Nov-11

  	
   

  	
  Dec-11

  
	
  Week #

  	
   

  	
  23

  	
   

  	
  24

  	
   

  	
  25

  	
   

  	
  26

  	
   

  	
  27

  	
   

  	
  28

  	
   

  	
  29

  	
   

  	
  30

  	
   

  	
  31

  	
   

  	
  32

  	
   

  	
  33

  	
   

  	
  34

  	
   

  	
  35

  	
   

  	
  36

  	
   

  	
  37

  	
   

  	
  38

  	
   

  	
  39

  	
   

  	
  40

  	
   

  	
  41

  	
   

  	
  42

  	
   

  	
  43

  	
   

  	
  44

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  53

  
	
  Date

  	
   

  	
  5/30

  	
   

  	
  6/6

  	
   

  	
  6/13

  	
   

  	
  6/20

  	
   

  	
  6/27

  	
   

  	
  7/4

  	
   

  	
  7/11

  	
   

  	
  7/18

  	
   

  	
  7/25

  	
   

  	
  8/1

  	
   

  	
  8/8

  	
   

  	
  8/15

  	
   

  	
  8/22

  	
   

  	
  8/29

  	
   

  	
  9/5

  	
   

  	
  9/12

  	
   

  	
  9/19

  	
   

  	
  9/26

  	
   

  	
  10/3

  	
   

  	
  10/10

  	
   

  	
  10/17

  	
   

  	
  10/24

  	
   

  	
  10/31

  	
   

  	
  11/7

  	
   

  	
  11/14

  	
   

  	
  11/21

  	
   

  	
  11/28

  	
   

  	
  12/5

  	
   

  	
  12/12

  	
   

  	
  12/19

  	
   

  	
  12/26

  
	
  Deliveries
  per Week

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


First Wind - 2012 Component Availability Schedule - 20
Turbines


 


20 total; 4 per week starting
week 36 through week 40 of 2012


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jun-12

  	
   

  	
  Jul-12

  	
   

  	
  Aug-12

  	
   

  	
  Sep-12

  	
   

  	
  Oct-12

  	
   

  	
  Nov-12

  	
   

  	
  Dec-12

  
	
  Week #

  	
   

  	
  23

  	
   

  	
  24

  	
   

  	
  25

  	
   

  	
  26

  	
   

  	
  27

  	
   

  	
  28

  	
   

  	
  29

  	
   

  	
  30

  	
   

  	
  31

  	
   

  	
  32

  	
   

  	
  33

  	
   

  	
  34

  	
   

  	
  35

  	
   

  	
  36

  	
   

  	
  37

  	
   

  	
  38

  	
   

  	
  39

  	
   

  	
  40

  	
   

  	
  41

  	
   

  	
  42

  	
   

  	
  43

  	
   

  	
  44

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  53

  
	
  Date

  	
   

  	
  5/28

  	
   

  	
  6/4

  	
   

  	
  6/11

  	
   

  	
  6/18

  	
   

  	
  6/25

  	
   

  	
  7/2

  	
   

  	
  7/9

  	
   

  	
  7/16

  	
   

  	
  7/23

  	
   

  	
  7/30

  	
   

  	
  8/6

  	
   

  	
  8/13

  	
   

  	
  8/20

  	
   

  	
  8/27

  	
   

  	
  9/3

  	
   

  	
  9/10

  	
   

  	
  9/17

  	
   

  	
  9/24

  	
   

  	
  10/1

  	
   

  	
  10/8

  	
   

  	
  10/15

  	
   

  	
  10/22

  	
   

  	
  10/29

  	
   

  	
  11/5

  	
   

  	
  11/12

  	
   

  	
  11/19

  	
   

  	
  11/26

  	
   

  	
  12/3

  	
   

  	
  12/10

  	
   

  	
  12/17

  	
   

  	
  12/24

  
	
  Deliveries
  per Week

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


First Wind - 2013 Component Availability Schedule - 20
Turbines


 


20 total; 4 per week starting
week 36 until week 40 of 2013


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jun-13

  	
   

  	
  Jul-13

  	
   

  	
  Aug-13

  	
   

  	
  Sep-13

  	
   

  	
  Oct-13

  	
   

  	
  Nov-13

  	
   

  	
  Dec-13

  
	
  Week #

  	
   

  	
  23

  	
   

  	
  24

  	
   

  	
  25

  	
   

  	
  26

  	
   

  	
  27

  	
   

  	
  28

  	
   

  	
  29

  	
   

  	
  30

  	
   

  	
  31

  	
   

  	
  32

  	
   

  	
  33

  	
   

  	
  34

  	
   

  	
  35

  	
   

  	
  36

  	
   

  	
  37

  	
   

  	
  38

  	
   

  	
  39

  	
   

  	
  40

  	
   

  	
  41

  	
   

  	
  42

  	
   

  	
  43

  	
   

  	
  44

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  53

  
	
  Date

  	
   

  	
  6/3

  	
   

  	
  6/10

  	
   

  	
  6/17

  	
   

  	
  6/24

  	
   

  	
  7/1

  	
   

  	
  7/8

  	
   

  	
  7/15

  	
   

  	
  7/22

  	
   

  	
  7/29

  	
   

  	
  8/5

  	
   

  	
  8/12

  	
   

  	
  8/19

  	
   

  	
  8/26

  	
   

  	
  9/2

  	
   

  	
  9/9

  	
   

  	
  9/16

  	
   

  	
  9/23

  	
   

  	
  9/30

  	
   

  	
  10/7

  	
   

  	
  10/14

  	
   

  	
  10/21

  	
   

  	
  10/28

  	
   

  	
  11/4

  	
   

  	
  11/11

  	
   

  	
  11/18

  	
   

  	
  11/25

  	
   

  	
  12/2

  	
   

  	
  12/9

  	
   

  	
  12/16

  	
   

  	
  12/23

  	
   

  	
  12/30

  
	
  Deliveries
  per Week

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


First Wind - 2014 Component Availability Schedule - 50
Turbines


 


50 total; 4 per week starting
week 36 through week 48 of 2014


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jun-14

  	
   

  	
  Jul-14

  	
   

  	
  Aug-14

  	
   

  	
  Sep-14

  	
   

  	
  Oct-14

  	
   

  	
  Nov-14

  	
   

  	
  Dec-14

  
	
  Week #

  	
   

  	
  23

  	
   

  	
  24

  	
   

  	
  25

  	
   

  	
  26

  	
   

  	
  27

  	
   

  	
  28

  	
   

  	
  29

  	
   

  	
  30

  	
   

  	
  31

  	
   

  	
  32

  	
   

  	
  33

  	
   

  	
  34

  	
   

  	
  35

  	
   

  	
  36

  	
   

  	
  37

  	
   

  	
  38

  	
   

  	
  39

  	
   

  	
  40

  	
   

  	
  41

  	
   

  	
  42

  	
   

  	
  43

  	
   

  	
  44

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  53

  
	
  Date

  	
   

  	
  6/2

  	
   

  	
  6/9

  	
   

  	
  6/16

  	
   

  	
  6/23

  	
   

  	
  6/30

  	
   

  	
  7/7

  	
   

  	
  7/14

  	
   

  	
  7/21

  	
   

  	
  7/28

  	
   

  	
  8/4

  	
   

  	
  8/11

  	
   

  	
  8/18

  	
   

  	
  8/25

  	
   

  	
  9/1

  	
   

  	
  9/8

  	
   

  	
  9/15

  	
   

  	
  9/22

  	
   

  	
  9/29

  	
   

  	
  10/6

  	
   

  	
  10/13

  	
   

  	
  10/20

  	
   

  	
  10/27

  	
   

  	
  11/3

  	
   

  	
  11/10

  	
   

  	
  11/17

  	
   

  	
  11/24

  	
   

  	
  12/1

  	
   

  	
  12/8

  	
   

  	
  12/15

  	
   

  	
  12/22

  	
   

  	
  12/29

  
	
  Deliveries
  per Week

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


First Wind - 2015 Component Availability Schedule - 50
Turbines


 


50 total; 4 per week starting
week 36 until week 48 of 2015


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Jun-15

  	
   

  	
  Jul-15

  	
   

  	
  Aug-15

  	
   

  	
  Sep-15

  	
   

  	
  Oct-15

  	
   

  	
  Nov-15

  	
   

  	
  Dec-15

  
	
  Week #

  	
   

  	
  23

  	
   

  	
  24

  	
   

  	
  25

  	
   

  	
  26

  	
   

  	
  27

  	
   

  	
  28

  	
   

  	
  29

  	
   

  	
  30

  	
   

  	
  31

  	
   

  	
  32

  	
   

  	
  33

  	
   

  	
  34

  	
   

  	
  35

  	
   

  	
  36

  	
   

  	
  37

  	
   

  	
  38

  	
   

  	
  39

  	
   

  	
  40

  	
   

  	
  41

  	
   

  	
  42

  	
   

  	
  43

  	
   

  	
  44

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  53

  
	
  Date

  	
   

  	
  6/1

  	
   

  	
  6/8

  	
   

  	
  6/15

  	
   

  	
  6/22

  	
   

  	
  6/29

  	
   

  	
  7/6

  	
   

  	
  7/13

  	
   

  	
  7/20

  	
   

  	
  7/27

  	
   

  	
  8/3

  	
   

  	
  8/10

  	
   

  	
  8/17

  	
   

  	
  8/24

  	
   

  	
  8/31

  	
   

  	
  9/7

  	
   

  	
  9/14

  	
   

  	
  9/21

  	
   

  	
  9/28

  	
   

  	
  10/5

  	
   

  	
  10/12

  	
   

  	
  10/19

  	
   

  	
  10/26

  	
   

  	
  11/2

  	
   

  	
  11/9

  	
   

  	
  11/16

  	
   

  	
  11/23

  	
   

  	
  11/30

  	
   

  	
  12/7

  	
   

  	
  12/14

  	
   

  	
  12/21

  	
   

  	
  12/28

  
	
  Deliveries
  per Week

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  4

  	
   

  	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


1














 


Schedule III


Strategic Investment


 


A
“Strategic Investment” shall include any of the following:


 


*****


 

















 


Schedule IV


Escrow Instructions


 


1.
Upon the occurrence at any time of any one of the following (collectively, the
“Release Events”), the Escrow Agent shall release the ***** and the ***** to
Clipper:


 


(a)
receipt by the Escrow Agent of an announcement by Clipper of a Strategic
Investment, or


 


(b)
confirmation received by the Escrow Agent from Clipper of Clipper’s ***** to
First Wind of at least ***** Million Dollars, or at least ***** Million Dollars
if the ***** Turbine Payments have been paid by First Wind to Clipper, of paid
components or paid purchase orders for components, or work in progress with
respect to the ***** Turbines (such ***** to be in form and substance
reasonably satisfactory to First Wind, and to provide for the use by Clipper of
all such components in connection with Clipper’s Delivery to First Wind of the *****
Turbines), or


 


(c)
(i) the payment by Clipper to the Escrow Agent of the amount of the *****
Turbine Payment, and if paid by First Wind to Clipper, the ***** Turbine
Payments (for payment to First Wind upon ***** to Clipper), (ii) confirmation
received by the Escrow Agent from Clipper of Clipper’s agreement with First
Wind to pay to First Wind any and all other amounts paid by First Wind to
Clipper for the purchase of the ***** Turbines within thirty (30) days
following the release of the ***** to Clipper (and in the event that Clipper
does not pay to First Wind the amounts contemplated in this clause (c), First
Wind shall have the right to offset such amounts under clause (ii) not
paid by Clipper against any payment obligation under any *****), and (iii) confirmation
received by the Escrow Agent from Clipper of the release by Clipper of all
obligations of First Wind related to the purchase of the ***** Turbines under
the 2009 TSA, or


 


(d)
confirmation received by the Escrow Agent from Clipper of the issuance of a
guarantee, in form and substance reasonably satisfactory to First Wind, by a
company with a BBB- (S&P) or Baa3 (Moody’s) rating in favor of First Wind
that secures the delivery of the ***** Turbines no later than 60 days following
the last delivery date applicable to the ***** Turbines as set forth in the
applicable *****.


 


(e)
confirmation received by the Escrow Agent from Clipper of the Delivery of the *****
Turbines to First Wind, or


 


(f)
confirmation received by the Escrow Agent from Clipper that payment of the *****
Turbine Payment was not made by First Wind to Clipper within five (5) calendar
days following the date that the ***** was deposited into escrow.


 


2.
If one of the Release Events has not occurred on or before December 31,
2010, the Escrow Agent shall release the ***** to First Wind. *****.


 


3.
The escrow agreement shall allow for litigation as the means of dispute
resolution with respect to any disputes thereunder.


 














 


OMNIBUS AGREEMENT


 


This
OMNIBUS AGREEMENT (this “Agreement”), dated as of December 30,2008, is entered
into by and among First Wind Energy, LLC (“FWE”), Niagara Wind Power, LLC (“NWP”),
First Wind Acquisition III, LLC (“FWA Ill”), First Wind Acquisition IV, LLC (“FWA
IV”), and First Wind Acquisition V, LLC (“FWA V”, and together with FWE, NWP, FW
A III and FWA IV, “First Wind”) on the one hand, and Clipper Windpower, Inc. (“CWI”),
Clipper Turbine Works, Inc. (“CTW”) and Clipper Fleet Services, Inc. (“CFS” and,
together with CWI and CTW, “Clipper”) on the other hand. Each of First Wind and
Clipper are sometimes referred to hereafter as a “Party”, or collectively as
the “Parties”.


 


WHEREAS,
First Wind Acquisition II, LLC entered into that certain Turbine Supply
Agreement (“Steel Winds TSA”) and Warranty Agreement (“Steel Winds Warranty
Agreement”) with CTW, each dated as of July 24, 2006, which Steel Winds TSA and
Steel Winds Warranty Agreement were assigned by First Wind Acquisition II, LLC
to Steel Winds Project LLC pursuant to that Assignment and Assumption Agreement
among First Wind Acquisition II, LLC, Steel Winds Project LLC and CTW dated as
of September 1,2006, which Steel Winds TSA and Steel Winds Warranty Agreement
were further assigned by Steel Winds Project LLC to NWP in connection with that
certain letter dated June 1, 2007 from NWP to Steel Winds Project LLC notifying
Steel Winds Project LLC of NWP’s exercise of its option to purchase development
assets from Steel Winds Project LLC, and CFS and First Wind O&M, LLC, as
successor to UPC New York Wind O&M, LLC (“First Wind O&M”), entered
into that certain Turbine Operation, Maintenance and Service Agreement dated as
of July 24, 2006 (the “Steel Winds O&M Agreement”, together with the Steel
Winds TSA and the Steel Winds Warranty Agreement, collectively referred to
herein as the “Steel Winds Project Documents”), all relating to the eight (8) Turbine
wind project known as the “Steel Winds Project”.


 


WHEREAS,
CTW and FWA III entered into that certain Turbine Supply Agreement (“Cohocton
TSA”) and Warranty Agreement (“Cohocton Warranty”) relating to the fifty (50) Turbine
wind project known as the “Cohocton Project”.


 


WHEREAS,
CTW and FWA IV entered into that certain Amended and Restated Turbine Supply
Agreement (“Milford TSA”) and Warranty Agreement (“Milford Warranty”) relating
to the sixty four (64) Turbine wind project known as the “Milford Project”.


 


WHEREAS,
CTW and FWA IV entered into that certain Turbine Supply Agreement (“Sheffield
TSA”) and Warranty Agreement (“Sheffield Warranty”) relating to the sixteen (16)
Turbine wind project known as the “Sheffield Project”.


 


WHEREAS,
CTW and FWA V entered into (i) that certain Turbine Supply Agreement (“2009 TSA”)
and Warranty Agreement (“2009 Warranty”) relating to the purchase of thirty
five (35) turbines, (ii) that certain Turbine Supply Agreement (“2010 TSA”) and
Warranty Agreement (“2010 Warranty”) relating to the purchase of eighty (80) turbines,
(iii) that certain Turbine Supply Agreement (“2011 TSA”) and Warranty Agreement
(“2011 Warranty”) relating to the purchase of forty (40) turbines, (iv) that
certain Turbine Supply Agreement (“2012 TSA”) and Warranty Agreement (“2012
Warranty”) relating to the purchase of fifty (50) turbines and (v) that certain
Turbine Supply Agreement (“2013 TSA”) and Warranty Agreement (“2013


 

















 


Warranty” and together with
the Cohocton Warranty, the Milford Warranty, the Sheffield Warranty, the 2009
Warranty, the 2010 Warranty, the 2011 Warranty and the 2012 Warranty, the “Warranty
Agreements”) relating to the purchase of sixty (60) turbines.


 


WHEREAS,
the Steel Winds Project Documents, the Cohocton TSA, the Warranty Agreements, the
Milford TSA, the Sheffield TSA, the 2009 TSA, the 2010 TSA, the 2011 TSA, the
2012 TSA, the 2013 TSA, each as amended to date, shall be referred to herein as
the “Project Documents”, and the Steel Winds Project, the Cohocton Project, the
Milford Project and the Sheffield Project shall be collectively referred to
herein as the “Projects”.


 


WHEREAS,
on December 31, 2007, Clipper and FWE, NWP, First Wind O&M, FWA III and FWA
IV entered into that certain Settlement and Release Agreement (the “December 2007
Agreement”), and on March 24, 2008, Clipper and FWE, NWP, First Wind O&M, FWA
III, FWA IV, FWA V, Canandaigua Power Partners, LLC and Canadaigua Power
Partners II, LLC entered into that certain Agreement (the “March 2008 Agreement”,
and together with the December 2007 Agreement, the “Settlement Agreements”).


 


WHEREAS,
the Parties desire to enter into the following agreements with respect to the
Settlement Agreements, the Project Documents and the Projects.


 


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


 


ARTICLE I


PAYMENTS


 


1.1           Agreements Regarding Certain
Payment Obligations. In connection with the execution and delivery of
this Agreement by the Parties hereto:


 


(a)
          The Parties agree that ***** $*****
***** incurred by FWE and/or its affiliates in connection with the ***** is due by
Clipper to First Wind under Section 4.2 of the March 2008 Agreement (the “Financing
Costs”).


 


(b)
          *****


 


2

















 


*****


 


(c)
          The Parties agree that the
Original Towers shall not be Delivered to FWA V pursuant to the 2009 TSA. The
Parties acknowledge and agree that FWA V has the option to elect to purchase
the Additional Equipment Options (as defined in Schedule I hereto applicable to
the 2009 TSA) with respect to twelve (12) Towers no later than June 30, 2009
for Delivery by CTW pursuant to the new Delivery Schedule for the 2009 TSA set
forth in Schedule II.


 


(d)
          With respect to thirteen (13) Turbines
Delivered pursuant to the Milford TSA in December, 2008, First Wind shall make
a payment to CTW, no later than December 31, 2008, in the amount of ***** ($*****)
reflecting the cost of the Turbines less certain holdbacks noted in invoices
delivered by CTW to First Wind.


 


1.2
          Offsets Against Future
Payment Obligations. Clipper acknowledges and agrees that, as of the date
of this Agreement, each of FWA III (formerly known as UPC Wind Acquisition III,
LLC) and FWA IV (formerly known as UPC Wind Acquisition IV, LLC) has not, pursuant
to Section 1.2 of the December 2007 Agreement netted or offset the ***** (US $*****)
payable by CTW to each of FWA III  and FWA IV against amounts
payable by FWA III and FWA IV under the Cohocton TSA and Milford TSA, respectively.
Clipper acknowledges and agrees that the Section 1.2 of the December 2007
Agreement remains in full force and effect.


 


1.3
          Steel Winds Project Turbine
Availability Warranty Payments and Steel Winds Punch List Work Payment. 


 


(a)
          The Parties agree to meet to
attempt in good faith to agree upon the full amount of the Turbine Availability
Warranty Payment under the Steel Winds Warranty Agreement for the Warranty
Period Year ended May 31,2008. First Wind acknowledges that it has received $*****
of the Turbine Availability Warranty Payment to date.


 


(b)
          Notwithstanding the foregoing, pursuant
to Section 3.2 of the 2008 March Agreement, after payment, if any, is made upon
the agreement reached under Section 1.3(a) above, only $***** in Turbine
Availability Warranty Payments under the Steel Winds


 


3

















 


Warranty
Agreement shall be deemed to have been made for purposes of calculating the
limitations of liability with respect to the Turbine Availability Warranty
Payments and the aggregate amount of liquidated damages payable under Section 7.2
of the Steel Winds Warranty Agreement.


 


(c)
          The Parties agree that the full
amount payable by NWP to CTW for the Punch List Work completed by CTW under the
Steel Winds TSA with respect to Turbines 2, 3, 4, 5, 7 and 8 at the Steel Winds
Project is ***** (US $*****) (the “Punch List Payment”). The Punch List Payment
shall be paid by First Wind to Clipper no later than three business days after
the execution and delivery of this Agreement; provided, that the Punch List
Payment will be made no later than December 31, 2008.


 


(d)
          Upon the completion of the Punch
List Work with respect to Turbines 1 and 6 at the Steel Winds Project, the
amount of ***** (US $*****) shall be paid to Clipper in accordance with the
terms and conditions set forth under the Steel Winds TSA.


 


1.4
          Turbine Payments. Each
Payment Schedule to the Milford TSA, the Sheffield TSA, the 2009 TSA, the 2010
TSA, the 2011 TSA, the 2012 TSA and the 2013 TSA is hereby amended and replaced
with the new applicable Payment Schedule for such Project Document set forth in
Schedule I. The payments contemplated in Schedule I are required to be made by
First Wind only upon the satisfaction of the relevant milestones and in
accordance with the terms and conditions set forth in each applicable Project
Document.


 


ARTICLE II


PROJECT DOCUMENT AND PROJECT OBLIGATIONS


 


2.1                                 Milford TSA.


 


(a)
          The Delivery Schedule set forth
in Exhibit L to the Milford TSA is hereby amended and replaced with the new
Delivery Schedule for the Milford TSA set forth in Schedule II. With respect to
the two sets of Turbine Blades located in Houston, Texas which Clipper notified
First Wind will require remediation to address a Turbine Blade skin defect, FWA
IV shall make the Delivery milestone payment with respect to the two Turbines
that include such affected Turbine Blades as a Major Component less a holdback
amount of $***** per each set of Turbine Blades (applicable to each set, the “Holdback
Amount”). CTW shall provide written certification to First Wind that each such
set of Turbine Blades has been remediated in accordance with remediation
procedures DC-110298 Work Instructions, C9X Blade Patch Reinforcement issued by
CTW as a condition to FWA IV’s releasing the Holdback Amount applicable to each
Turbine Blade set to CTW. In the event that an affected Turbine Blade set is
not remediated before January 31, 2009, with respect to the next subsequent
Turbine Delivered by CTW pursuant to the Milford TSA, FWA IV shall not be obligated
to make the Delivery milestone payment for such Turbine until CTW provides
written certification to First Wind that such affected Turbine Blade set has
been remediated in accordance with remediation procedures DC-l10298 Work
Instructions, C9X Blade Patch Reinforcement issued by CTW.


 


4

















 


(b)
          On or before January 15, 2009, FWA
IV shall have the right, with respect to seven (7) or fewer Turbines (the “Designated
Turbines”), to change the type of Turbine to be provided by CTW under the
Milford TSA from a “C-99” series Turbine to a “C-96” series Turbine or a “C-93”
series Turbine at no additional cost to FWA IV. The Designated Turbines shall be
Delivered pursuant to the terms and conditions of the Milford TSA; provided,
that, First Wind shall have the right to install the Designated Turbines
at any project site, including the Milford Site. In the event that First Wind
elects to install the Designated Turbines at a project other than the Milford
Project, Clipper and First Wind (or  an affiliate of First Wind) shall,
prior to the installation of the Designated Turbines, enter into a new turbine
supply agreement, warranty agreement and operation, maintenance and service
agreement on substantially the same terms and conditions as set forth in the
Project Documents for the Milford Project (subject to reasonable revisions due
to material differences in project size or location or turbine requirements) or
enter into amendments with respect to existing agreements between affiliates of
the Parties, as the case may be, to take into account the Designated Turbines.


 


2.2                                 Sheffield TSA
and Sheffield Warranty.


 


(a)
          The Delivery Schedule set forth
in Exhibit L to the Sheffield TSA is hereby amended and replaced with the new
Delivery Schedule for the Sheffield TSA set forth in Schedule II.


 


(b)
          The first sentence of the first
Recital in the Sheffield TSA is replaced with the following:


 


“WHEREAS, Purchaser desires to purchase, and Supplier desires to sell
twelve (12) Clipper Windpower 2.5 MW “C-93” series wind turbine generators and
four (4) Clipper Windpower 2.5 MW “C-96” series wind turbine generators (each a
“Turbine” and collectively, the “Turbines”), each consisting of the Major
Turbine Components and Ancillary Parts and Equipment (as set forth in Exhibit
A hereto).”


 


(c)
          Exhibit E to the Sheffield TSA
shall be amended by attaching thereto the supplemental exhibit (Foundation
Loads Document) relating to the Clipper Windpower 2.5 MW “C-93” series wind
turbine generator attached hereto in Schedule III.


 


(d)
          With respect to up to four (4) of
the Turbines to be Delivered by CTW under the Sheffield TSA, the Parties agree
that CTW may use gearbox castings that have been recycled from the Steel Winds
Project; provided that such castings shall be free from Defects and such
castings shall be subject to the Standard Warranty provided by CTW under the
Sheffield Warranty. The bearings, gears and associated components installed in
such recycled castings shall be new.


 


(e)
          Exhibit C-2 to the Sheffield
Warranty shall be amended by attaching thereto the supplemental exhibit (Power
Curve) relating to the Clipper 2.5 MW “C-93” series wind turbine generator
attached hereto in Schedule IV.


 


(f)
           Section 3.1 of the Sheffield
Warranty shall be amended by adding the following sentence as the last sentence
in such Section 3.1:


 


5

















 


“Notwithstanding anything to the contrary set forth in this Agreement, if
Purchaser elects to test and measure the Power Curve Warranty under this Article
3, in determining the Power Curve Warranty Payments, if any, payable by
Supplier, the Parties agree that such calculations shall be made for each type
of Turbine (C-93 or C-96) using the results of the power curve testing conducted
on each type of Turbine (C-93 or C-96) and taking into consideration the number
of each type of Turbine (C-93 or C-96) located at the Project. For the
avoidance of doubt, and for illustrative purposes only, if Purchaser elects to
test and measure the Power Curve Warranty, and if after the MPPT is performed
on each Nominated Turbine (one series C-93 Turbine and one series C-96 Turbine),
the ANME is greater than the WPCP of NEE with respect to the twelve (12) C-93 Turbines
and the ANME is less than the WPCP of NEE with respect to the four (4) C-96 Turbines,
then Supplier shall have no liability to pay Power Curve Warranty Payments with
respect to the twelve (12) C-93 Turbines and Supplier shall only be liable to
pay the Power Curve Warranty Payments with respect to the four (4) C-96 Turbines.”


 


(g)
          The second sentence of Section 3.2
of the Sheffield Warranty is hereby deleted and replaced as follows:


 


“If
Purchaser chooses to have the Testing Engineer engage in the MPPT, the MPPT
shall be performed on one (1) series C-93 Turbine and one (1) series C-96 Turbine
selected by Purchaser, subject to Supplier’s prior approval, such approval not
to be unreasonably withheld (the “Nominated Turbines”).”


 


(h)
          On or prior to May 1, 2009, First
Wind shall pay to CTW an amount equal to ***** ($*****) as consideration for
provision of twelve C-93 series Turbine Blades
instead of twelve C-96 series Turbine Blades.


 


2.3                                 2009 TSA.


 


(a)
          The Delivery Schedule set forth
in Exhibit L to the 2009 TSA is hereby amended and replaced with the new
Delivery Schedule for the 2009 TSA set forth in Schedule II.


 


(b)
          The Purchase Price set forth in Section
3.1 of the 2009 TSA is hereby amended to mean an amount equal to ***** ($*****).


 


2.4                                 2010 TSA.


 


(a)
          Subject to the occurrence of the
***** the Delivery Schedule set forth in Exhibit L to the 2010 TSA shall be
amended and replaced with the new Delivery Schedule for the 2010 TSA (the “Current
Delivery Schedule”) set forth in Schedule II.


 


(b)
          In the event that the ***** (i) occurs
on or after ***** (as defined below) or (ii) subject to Section 2.4(c) below, does
not occur on or before the ***** the Current Delivery Schedule shall be amended
and replaced with a new Delivery Schedule for the 2010 TSA such that the first
forty (40) Turbines under the 2010 TSA shall be deliverable between *****


 


6

















 


*****, whichever date is
earlier; the next thirty (30) Turbines under the 2010 TSA shall be deliverable
between *****, whichever date is earlier; and the remaining ten (10) Turbines
under the 2010 TSA shall be deliverable between *****, whichever date is
earlier; provided, that, if such new Delivery Schedule
results in scheduled deliveries of Turbines ***** under the Current Delivery
Schedule, the Current Delivery Schedule shall control; and provided further, that,
in the event that any Turbine under the 2010 TSA is ***** as a result of the
foregoing, *****. The ***** shall mean ***** provided, that the Production Tax
Credits under Section 45 of the Internal Revenue Code (as amended from time to
time, the “PTCs”) are available *****. In the event that the PTCs are not
available as of ***** shall mean the date that the PTCs have been available
after *****. In no event shall the ***** extend beyond *****.


 


(c)
          In the event that the ***** does
not occur on or ***** and provided that the PTCs have been available for
*****, Clipper shall ***** First Wind in *****, no later than fifteen (15) days
after the *****, the ***** (US $*****) ***** and the 2010 TSA shall terminate
without any further action of the parties thereto.


 


(d)
          No later than six (6) months
prior to the date that Turbines under the 2010 TSA are to be delivered (for
each of the delivery periods in 2011, 2012 and 2013), Clipper shall provide an
updated Delivery Schedule with respect to the 2010 TSA Turbines indicating the
number of Turbines to be delivered on a weekly basis.


 


(e)
          ***** shall mean the occurrence
of:


 


(i) the execution and
delivery of a binding ***** (or similar agreement) or a binding ***** or any of
its affiliates with respect to (A) the Milford Project, or (B) the Cohocton
Project or (C) a third party wind energy project or projects located in the
United States developed with Clipper wind turbine generators, provided that, as
applicable to the third party wind energy project or projects, (x)(a) if the
project or projects include only *****


 


7

















 


***** or (b) if the
project or projects include ***** capacity in such project or
projects; provided that clause 2.4(e)(i)(C)(x)(b)(2) shall only be satisfied if
another third party wind energy project or projects ***** wind turbine
generator nameplate capacity in such project or projects, otherwise satisfies
the conditions set forth in this Section 2.4(e); and (y) the ***** supplied for
such project or projects are supplied under turbine supply agreements having
terms and conditions ***** the Milford TSA or the
Cohocton TSA; provided however, that the condition set forth in (y) immediately
above shall be met if Clipper offers to provide to First Wind the ***** to such third
party on terms (including but not limited to the number of wind turbine
generators applicable to, ***** such *****


 


(ii) all conditions
precedent ***** directly or indirectly related to the ***** set forth in
such ***** Agreement having been satisfied or waived by the applicable party
obligated to ***** Agreement (the *****), including,
without limitation, the delivery of a final *****


 


(f)
           The Purchase Price with respect
to the Turbines under the 2010 TSA shall be adjusted as follows: (i) with
respect to the Turbines delivered in 2011, such Turbines shall be priced based
on the per Turbine price as set forth in the 2011 TSA; (ii) with respect to the
Turbines delivered in 2012, such Turbines shall be priced based on the per
Turbine price as set forth in the 2012 TSA; and (iii) with respect to the
Turbines delivered in 2013, such Turbines shall be priced based on the per
Turbine price as set forth in the 2013 TSA.


 


2.5                                 2011 TSA, 2012
TSA and 2013 TSA.


 


(a)
          The Delivery Schedule set forth
in Exhibit L to each of the 2011 TSA, the 2012 TSA and the 2013 TSA is hereby
amended and replaced with the new Delivery Schedule applicable to each
respective Project Document set forth in Schedule II.


 


(b)
          In the event that the ***** is
not satisfied before June 30, 2009, the $***** payment
presently scheduled to be made in September, 2009 under the 2011 TSA, and the $*****,  $*****, and $***** payments that
are presently scheduled to be made in September, 2009 under each of the 2011
TSA, the 2012 TSA and the 2013 TSA, respectively pursuant to the applicable
Payment Schedule set forth in Schedule I, shall be amended such that (i) the $***** payment
presently scheduled to be made in


 


8






 










 


September, 2009 shall be
made March 15, 2010 and (ii) the $*****, $***** and $***** payments
presently scheduled to be made in September, 2009 shall be made June 15, 2010.


 


2.6
          *****


 


2.7           *****


 


(a)           Section 3.3.1(c) of the
Milford TSA, the Sheffield TSA, the 2010 TSA, the 2011 TSA, the 2012 TSA and
the 2013 TSA is hereby amended by replacing the first sentence of such Section 3.3.1(c) with
the following:


 


*****


(b)           Section 3.3.
l(c) of the Milford TSA, the Sheffield TSA, the 2010 TSA, the 2011 TSA, the
2012 TSA and the 2013 TSA is hereby amended by inserting the following after
the second sentence of Section 3.3.1(c):


 


*****


 


9

















 


(c)           Section 3.3.1(c) of the
Milford TSA, the Sheffield TSA, the 2010 TSA, the 2011 TSA, the 2012 TSA and
the 2013 TSA is hereby amended by replacing the seventh sentence (after taking
into consideration the amendment pursuant to Section 2.7(b) above) of
such Section 3.3.1(c) with the following:


 


*****


 


(d)           Section 3.3.1(c) of the
Milford TSA, the Sheffield TSA, the 2010 TSA, the 2011 TSA, the 2012 TSA and
the 2013 TSA is hereby amended by replacing the ninth sentence (after taking
into consideration the amendment pursuant to Section 2.7(b) above) of such Section 3.3.1(c) with
the following:


 


*****


 


(e)           Section 3.3.1(c) of the
Milford TSA, the Sheffield TSA, the 2010 TSA, the 2011 TSA, the 2012 TSA and
the 2013 TSA is hereby amended by replacing references to “3.3(d)” or “3.3.1(d)”
therein with “3.3.1(c).”


 


(f)            The 2009 TSA is hereby
amended by adding a new Section 3.3.1(c) into the 2009 TSA that
incorporates by reference, Section 3.3.1(c) of the 2010 TSA, as
modified by this Agreement.


 


ARTICLE III


ADDITIONAL AGREEMENTS


 


3.1
          Termination of Thirty Five
Turbine Purchase. The Parties hereby agree to terminate Section 4.1 of
the March 2008 Agreement with respect to the purchase of thirty five (35) additional
turbines.


 


3.2
          ***** Financing Cooperation.
Clipper shall provide reasonable cooperation in connection with First Wind’s
efforts to achieve the ***** Financing. First Wind shall use commercially
reasonable efforts to achieve the ***** on customary terms and conditions in
the ***** on or before the *****


 


3.3
          Cohocton Project Completion
and Remediation Costs. The Parties agree to meet to attempt in good faith
to agree upon the settlement of all claims relating to the project completion
and remediation costs incurred relating to the Cohocton Project.


 


10

















 


3.4
          Definition of AWA Period
under the Warranty Agreements. The definition of “AWA Period” under each Warranty
Agreement shall be amended with the following new definition of “AWA Period”:


 


“AWA Period shall
mean each of the initial five (5) Warranty Period Years; provided, that,
for the first Warranty Period Year, each of the first ninety (90) days, the
next ninety (90) days thereafter and the remaining number of days in such first
Warranty Period Year shall constitute an AWA Period.”


 


3.5
          Master Escrow Agreement. Promptly
following the execution and delivery of this Agreement, Clipper and First Wind
shall execute and deliver a master escrow agreement with Iron Mountain
Intellectual Property Management, Inc. (“Iron Mountain”) in connection
with the obligations of Clipper to deliver certain ***** into escrow in
accordance with the Project Documents. Such master escrow agreement shall be in
form and substance similar to the Three- Party Escrow Service Agreement, dated
as of April 15, 2008, among Iron Mountain, NWP and CTW.


 


3.6
          Effectiveness of Certain
Provisions. The Parties acknowledge and agree that the provisions in
Sections 1.4, 2.1, 2.2, 2.6, 2.7 and 3.4 of this Agreement relating to the
Cohocton TSA, the Cohocton Warranty, the Milford TSA, the Milford Warranty, the
Sheffield TSA and the Sheffield Warranty, as applicable, require the consent of
lenders to the applicable First Wind entities and that such provisions shall
not become effective until such consents are obtained. First Wind shall notify
Clipper when the consent of such lenders has been granted. For the avoidance of
doubt, nothing in this Section 3.6 shall limit the effectiveness of
Sections 1.1 (d), 1.3 (c) and 1.3 (d) to this Agreement.


 


ARTICLE IV


 


REPRESENTATIONS AND WARRANTIES


 


4.1
          Representations of all Parties.
Each Party represents and warrants to the other Parties that (a) such
Party is an organization duly organized, validly existing and in good standing
under the laws of the state of its organization and is qualified to do business
in each jurisdiction it is required to be by applicable law, (b) the
execution, delivery and performance of this Agreement by such Party has been
duly authorized by all necessary corporate or limited liability company action,
as applicable, on the part of such Party and does not and will not require the
consent of any trustee or holder of any indebtedness or other obligation of
such Party or any other party to any other agreement with such Party other than
any consents already obtained, (c) this Agreement has been duly executed
and delivered by such Party and constitutes the legal, valid and binding
obligation of such Party enforceable against it in accordance with its terms, except
to the extent limited by bankruptcy, insolvency or other similar laws relating
to the rights of creditors, or by general principles of equity, and (d) no
governmental authorization, approval, order, license, permit, franchise or
consent, and no registration, declaration or filing with any governmental
authority is required on the part of such Party in connection with the
execution, delivery or performance of this Agreement.


 


11

















 


ARTICLE V


MISCELLANEOUS


 


5.1
          Entire Agreement: Defined
Terms. This Agreement contains the entire understanding of the Parties
relating to the subject matter hereof and supersedes all prior written or oral
and all contemporaneous oral agreements and understandings relating to the
subject matter hereof. Any terms not otherwise defined in this Agreement shall
have the meaning as defined in the Project Documents. Except as amended hereby,
all the terms and conditions in all Project Documents shall remain in full
force and effect. Each Party agrees to keep the terms and provisions of this
Agreement and all materials and information that each Party receives pursuant
hereto or in connection herewith in the strictest confidence and not to
disclose any of the foregoing to any party other than the respective lenders, investors,
potential lenders or investors, attorneys, accountants, affiliates, officers
and directors of each Party or as such Party may be required by law, court
order or in any litigation to disclose.


 


5.2
          No Third Party Beneficiary.
This Agreement is made for the sole benefit of the Parties hereto and their
respective successors, executors and permitted assigns, and nothing contained
herein, express or implied, is intended to or shall confer upon any other
person any third-party beneficiary right or any other legal or equitable rights,
benefits or remedies of any nature whatsoever under or by reason of this
Agreement.


 


5.3
          Governing Law. This
Agreement will be governed by and construed and interpreted in accordance with
the substantive laws of the State of New York, without giving effect to any
choice of law or conflicts of law provision or rule that would cause the
application of the laws of a jurisdiction other than New York.


 


5.4
          Neutral Construction. The
Parties hereto agree that this Agreement was negotiated fairly between them at
arms’ length and that the final terms of this Agreement are the product of the
Parties’ negotiations. Each party represents and warrants that it has sought
and received legal counsel of its own choosing with regard to the contents of
this Agreement and the rights and obligations affected hereby. The Parties
hereto agree that this Agreement shall be deemed to have been jointly and
equally drafted by them, and that no provisions of this Agreement should be
construed against either party on the grounds that such party drafted or was
more responsible for drafting such provision.


 


5.5
          Severability. In the
event that any one or more of the provisions or parts of a provision contained
in this Agreement shall for any reason be held to be invalid, illegal or
unenforceable in any respect in any jurisdiction, such invalidity, illegality
or unenforceability shall not affect any other provision or part of a provision
of this Agreement or any other jurisdiction, but this Agreement shall be
reformed and construed in any such jurisdiction as if such invalid or illegal
or unenforceable provision or part of a provision had never been contained
herein and such provision or part shall be reformed so that it would be valid, legal
and enforceable to the maximum extent permitted in such jurisdiction, provided
that any such reform or construction does not affect the economic or legal
substance of the transactions contemplated hereby in a manner adverse to any
party.


 


12

















 


5.6
          Heading: Construction. The
descriptive headings of the Articles and Sections of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.


 


5.7
          Expenses. Each party
shall be responsible for the payment of its own costs and expenses (including
reasonable attorneys’ fees) in connection with the preparation, execution and
delivery of this Agreement. Nevertheless, in any action or proceeding to
enforce this Agreement, the prevailing party shall be entitled to payment of
its reasonable costs and expenses (including reasonable attorneys’ fees).


 


5.8
          Counterparts. This
Agreement may be executed in one or more counterparts for the convenience of
the Parties hereto, each of which shall be deemed an original and all of which
together will constitute one and the same instrument. This Agreement shall be
effective upon delivery of original signature pages or facsimile or
electronic mail copies thereof.


 


5.9
          Further Actions. Upon the
terms and subject to the conditions set forth in this Agreement, the Parties
hereto shall each use their respective commercially reasonable efforts to take,
or cause to be taken, all appropriate action, and to do, or cause to be done, and
to assist and cooperate with the other Parties hereto in doing, all things
necessary, proper or advisable under applicable laws to consummate the
transactions contemplated hereby. First Wind and Clipper shall, from time to
time after the delivery and execution of this Agreement, at the request of
either Party, execute and deliver stand-alone agreements or amendments as the
requesting Party may reasonably request to evidence the agreement or agreements
made under this Agreement with respect to a particular Project Document or
particular Project Documents. In connection with the execution of this
Agreement, First Wind has requested the applicable Clipper entities to execute
the following stand-alone amendments: Amendment No. 1 to the Milford TSA
and the Milford Warranty; Amendment No. 1 to the Sheffield TSA and the
Sheffield Warranty; and Amendment No. 3 to the Cohocton Warranty.


 


5.10
        Dispute Resolution. Any
controversy, claim or dispute between the Parties arising out of or related to
this Agreement which cannot be settled amicably by the Parties, shall be
submitted for binding arbitration in accordance with the provisions contained
herein and in accordance with the Commercial Arbitration Rules of the
American Arbitration Association (“Rules”). Judgment upon the award rendered by
the arbitrator may be entered in any court having jurisdiction. The arbitrator
shall determine all questions of fact and law relating to any controversy, claim
or dispute hereunder, including but not limited to whether or not any such
controversy, claim or dispute is subject to the arbitration provisions
contained herein. Any Party desiring arbitration shall serve on the other Party
and the New York Office of the American Arbitration Association, in accordance
with the Rules, its Notice of Intent to Arbitrate (“Notice”). The Parties shall
agree on an arbitrator, and if the Parties cannot agree upon an arbitrator
within ten (10) days after the date of the Notice, the arbitrator shall be
selected in accordance with the Rules. The arbitration proceedings are hereby
declared to be self-executing, and it shall not be necessary to petition a
court to compel arbitration. All arbitration proceedings shall be held in New
York, New York. The Parties agree to bear their own costs associated with any
required travel to and from New York. Notice of the demand for arbitration
shall be filed in writing with the other Party to this Agreement and with the
American Arbitration Association. The demand for arbitration shall be made
within a reasonable time after the controversy, claim or dispute has arisen, and
in no event shall it be made after the date when institution of legal or


 


13

















 


equitable
proceedings based on such claim, dispute or other matter in question would be
barred by the applicable statutes of limitations.


 


14

















 


IN
WITNESS WHEREOF, the Parties hereto have executed this Agreement as of the date
first written above.


 


	
  CLIPPER
  TURBINE WORKS, INC.

  	
   

  	
  CLIPPER FLEET SERVICES,
  INC.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Robert Gates

  	
   

  	
  By:

  	
  /s/ Robert Gates

  
	
  Name:

  	
  Robert Gates

  	
   

  	
  Name:

  	
  Robert Gates

  
	
  Title:

  	
  Senior Vice President

  	
   

  	
  Title:

  	
  Senior Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  CLIPPER
  WINDPOWER, INC.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Robert Gates

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Robert Gates

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Senior Vice President

  	
   

  	
   

  	
   

  



 


[Signature Page to Agreement]


 

















 


	
  FIRST
  WIND ACQUISITION III, LLC

  	
   

  	
  FIRST WIND ACQUISITION IV,
  LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Paul Gaynor

  	
   

  	
  By:

  	
  /s/ Paul Gaynor

  
	
  Name:

  	
  Paul Gaynor

  	
   

  	
  Name:

  	
  Paul Gaynor

  
	
  Title:

  	
  President

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  FIRST
  WIND ACQUISITION V, LLC

  	
   

  	
  FIRST WIND ENERGY, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Paul Gaynor

  	
   

  	
  By:

  	
  /s/ Paul Gaynor

  
	
  Name:

  	
  Paul Gaynor

  	
   

  	
  Name:

  	
  Paul Gaynor

  
	
  Title:

  	
  President

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  NIAGARA WIND POWER, LLC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Paul Gaynor

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Paul Gaynor

  
	
   

  	
   

  	
   

  	
  Title:

  	
  President

  



 


[Signature
Page to Agreement]


 














 


[2009 TSA]


 


CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR THE
REDACTED PORTIONS OF THIS AGREEMENT. THE REDACTIONS ARE INDICATED WITH FIVE
ASTERISKS (“*****”).  A COMPLETE VERSION
OF THIS AGREEMENT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION.


 


Execution Copy


 


TURBINE SUPPLY AGREEMENT


 


BY AND BETWEEN


 


UPC WIND ACQUISITION V, LLC


 


AND


 


CLIPPER TURBINE WORKS, INC.


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE 1

  	
  DEFINITIONS AND RULES OF INTERPRETATION

  	
  1

  
	
  1.1

  	
  Definitions

  	
  1

  
	
  1.2

  	
  Rules of Interpretation

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
  SUPPLY AND OTHER OBLIGATIONS OF SUPPLIER

  	
  2

  
	
  2.1

  	
  Supply and Commissioning Obligations

  	
  2

  
	
  2.2

  	
  Permits; Governmental Requirements

  	
  3

  
	
  2.3

  	
  Purchaser’s Right to Inspect

  	
  3

  
	
  2.4

  	
  Subcontractors

  	
  3

  
	
  2.5

  	
  Safety

  	
  4

  
	
  2.6

  	
  Independent Contractor

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
  PURCHASE PRICE AND PAYMENT

  	
  4

  
	
  3.1

  	
  Purchase Price

  	
  4

  
	
  3.2

  	
  Taxes

  	
  4

  
	
  3.3

  	
  Progress Payments

  	
  4

  
	
  3.4

  	
  Punch List Retainage

  	
  5

  
	
  3.5

  	
  Purchaser’s Credit Support

  	
  5

  
	
  3.6

  	
  Warranty Agreement

  	
  5

  
	
  3.7

  	
  Operations and Maintenance Service Agreement

  	
  5

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  DUTIES AND OBLIGATIONS OF PURCHASER

  	
  5

  
	
  4.1

  	
  Purchaser’s Obligations

  	
  5

  
	
  4.2

  	
  Cooperation with Supplier; Purchaser’s
  Representative

  	
  7

  
	
  4.3

  	
  Permits; Governmental Requirements

  	
  7

  
	
  4.4

  	
  Safety

  	
  7

  
	
  4.5

  	
  Intellectual Property Rights: Licenses and
  Obligations

  	
  7

  
	
  4.6

  	
  Transfer

  	
  9

  
	
  4.7

  	
  Access to Information

  	
  9

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  COMMENCEMENT, DELIVERY AND SHIPMENT

  	
  9

  
	
  5.1

  	
  Commencement

  	
  9

  
	
  5.2

  	
  Shipping Arrangements

  	
  10

  
	
  5.3

  	
  Delivery Schedule

  	
  10

  
	
  5.4

  	
  Designated Delivery Locations

  	
  10

  
	
  5.5

  	
  Delay Delivery Damages

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  FINAL ASSEMBLY WORK, INSTALLATION WORK,
  COMMISSIONING WORK AND PROJECT COMPLETION

  	
  11

  
	
  6.1

  	
  Final Assembly Work and Turbine Installation

  	
  11

  
	
  6.2

  	
  Commissioning

  	
  11

  
	
  6.3

  	
  Project Completion

  	
  12

  
	
  6.4

  	
  Purchaser Delays

  	
  12

  



 


i

















 


TABLE OF CONTENTS


(continued)


 


	
  ARTICLE 7

  	
  FORCE MAJEURE EVENTS

  	
  12

  
	
  7.1

  	
  Excused Performance

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  CHANGE ORDERS

  	
  13

  
	
  8.1

  	
  Change Order

  	
  13

  
	
  8.2

  	
  Change Order Process

  	
  13

  
	
  8.3

  	
  No Change

  	
  13

  
	
  8.4

  	
  Scope Changes Caused by a Force Majeure Event

  	
  14

  
	
  8.5

  	
  Scope Changes Caused by Events within the Control of
  Purchaser

  	
  14

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
  LIMITATION OF LIABILITY

  	
  14

  
	
  9.1

  	
  Supplier Not Responsible for Purchaser’s Work

  	
  14

  
	
  9.2

  	
  Overall Limitation of Liability

  	
  14

  
	
  9.3

  	
  Consequential Damages

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
  TITLE AND RISK OF LOSS; INSURANCE

  	
  15

  
	
  10.1

  	
  Title to Supply Items

  	
  15

  
	
  10.2

  	
  Risk of Loss

  	
  15

  
	
  10.3

  	
  Insurance

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11

  	
  REPRESENTATIONS AND WARRANTIES OF SUPPLIER

  	
  19

  
	
  11.1

  	
  Due Organization; Good Standing

  	
  19

  
	
  11.2

  	
  Due Authorization

  	
  19

  
	
  11.3

  	
  Execution and Delivery

  	
  19

  
	
  11.4

  	
  Governmental Approvals

  	
  19

  
	
  11.5

  	
  Supply Items; Services

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
  REPRESENTATIONS AND WARRANTIES OF PURCHASER

  	
  20

  
	
  12.1

  	
  Due Organization; Good Standing; Qualified To Do
  Business

  	
  20

  
	
  12.2

  	
  Due Authorization

  	
  20

  
	
  12.3

  	
  Execution and Delivery

  	
  20

  
	
  12.4

  	
  Governmental Approvals

  	
  20

  
	
  12.5

  	
  Project Site

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13

  	
  MUTUAL INDEMNITY

  	
  21

  
	
  13.1

  	
  Mutual Indemnity

  	
  21

  
	
   

  	
   

  	
   

  
	
  ARTICLE 14

  	
  DEFAULT; CURE; REMEDIES

  	
  21

  
	
  14.1

  	
  Default by Supplier

  	
  21

  
	
  14.2

  	
  Purchaser’s Remedies

  	
  21

  
	
  14.3

  	
  Default by Purchaser

  	
  22

  
	
  14.4

  	
  Supplier’s Remedies

  	
  22

  
	
  14.5

  	
  Cancellation Due to a Force Majeure Event

  	
  22

  
	
  14.6

  	
  Surviving Obligations

  	
  23

  



 


ii

















 


TABLE OF CONTENTS


(continued)


 


	
  ARTICLE 15

  	
  DISPUTE RESOLUTION

  	
  23

  
	
  15.1

  	
  Procedure

  	
  23

  
	
  15.2

  	
  Qualifications of Arbitrators; Expenses

  	
  26

  
	
  15.3

  	
  Performance During Dispute

  	
  26

  
	
  15.4

  	
  Consolidation

  	
  26

  
	
  15.5

  	
  Language

  	
  26

  
	
   

  	
   

  	
   

  
	
  ARTICLE 16

  	
  GENERAL PROVISIONS

  	
  26

  
	
  16.1

  	
  Waiver

  	
  26

  
	
  16.2

  	
  Successors and Assigns

  	
  26

  
	
  16.3

  	
  Permitted Assignments

  	
  26

  
	
  16.4

  	
  Notices

  	
  27

  
	
  16.5

  	
  Governing Law

  	
  28

  
	
  16.6

  	
  Amendments

  	
  28

  
	
  16.7

  	
  Attachments Incorporated

  	
  28

  
	
  16.8

  	
  Entire Agreement

  	
  28

  
	
  16.9

  	
  Confidentiality

  	
  28

  
	
  16.10

  	
  Counterparts

  	
  29

  
	
  16.11

  	
  English Language Documents

  	
  29

  
	
  16.12

  	
  Severability

  	
  29

  
	
  16.13

  	
  Headings

  	
  29

  
	
  16.14

  	
  Agreement Revisions

  	
  29

  



 


iii

















 


Exhibits


 


	
  Appendix I

  	
   

  	
  Definitions

  
	
  Exhibit A

  	
   

  	
  Ancillary Parts and Equipment

  
	
  Exhibit B

  	
   

  	
  Payment Schedule

  
	
  Exhibit C

  	
   

  	
  Spare Parts

  
	
  Exhibit D

  	
   

  	
  Turbine Installation Manual

  
	
  Exhibit E

  	
   

  	
  Foundation Loads Document

  
	
  Exhibit F

  	
   

  	
  Turbine Component Storage Requirements

  
	
  Exhibit G

  	
   

  	
  Termination Schedule

  
	
  Exhibit H

  	
   

  	
  Supplier’s Major Turbine Component Suppliers

  
	
  Exhibit I

  	
   

  	
  Supplier Account

  
	
  Exhibit J

  	
   

  	
  Guaranty

  
	
  Exhibit K

  	
   

  	
  Transferee Agreement and Acknowledgment

  
	
  Exhibit L

  	
   

  	
  Delivery Schedule

  
	
  Exhibit M

  	
   

  	
  Commissioning Certificate

  
	
  Exhibit N

  	
   

  	
  Project Completion Certificate

  
	
  Exhibit O

  	
   

  	
  Commissioning and Start-Up Procedures

  
	
  Exhibit P

  	
   

  	
  Final Assembly Work

  
	
  Exhibit Q

  	
   

  	
  Project Site

  
	
  Exhibit R

  	
   

  	
  Supplier Permits

  
	
  Exhibit S

  	
   

  	
  Turbine Specifications

  
	
  Exhibit T

  	
   

  	
  Completion Schedule

  
	
  Exhibit U

  	
   

  	
  SCADA System Specifications

  
	
  Exhibit V

  	
   

  	
  SCADA System Installation Manual

  



 


i

















 


TURBINE SUPPLY AGREEMENT


 


THIS TURBINE SUPPLY AGREEMENT (the “Agreement” or the “Supply Agreement”)
is made and entered into and effective as of December 31, 2007 by and
between CLIPPER TURBINE WORKS, INC., a Delaware corporation (“Supplier”), and
UPC WIND ACQUISITION V, LLC, a Delaware limited liability company with a place
of business c/o UPC Wind Management, LLC, 85 Wells Ave., Suite 305,
Newton, MA 02459 (“Purchaser”). Supplier and Purchaser are sometimes referred
to, individually, as a “Party” or, collectively, as the “Parties”.


 


RECITALS


 


WHEREAS, Purchaser desires to purchase, and Supplier desires to sell
thirty five (35) Clipper Windpower 2.5 MW “C-96” series wind turbine generators
(each a “Turbine” and collectively, the “Turbines”), each consisting of the
Major Turbine Components and Ancillary Parts and Equipment (as set forth in Exhibit A
hereto). Additionally, Purchaser, in connection with its purchase of the
Turbines, desires to purchase and Supplier desires to provide the Commissioning
Work (as defined in Appendix I hereto), all on the terms and subject to
the conditions set forth herein.


 


WHEREAS, Purchaser shall incorporate the Turbines into an 87.5 MW wind
power project being developed by Purchaser to be located at a single project
site within the state of Hawaii (the “Project”).


 


NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, Supplier and Purchaser, intending to
be legally bound, hereby agree as follows:


 


AGREEMENT


 


ARTICLE 1


 


DEFINITIONS
AND RULES OF INTERPRETATION


 


1.1      Definitions. For
purposes of the Turbine Supply Documents and all schedules, exhibits and
attachments thereto, and in addition to the definitions elsewhere in this
Agreement and the other Turbine Supply Documents, the terms listed in Appendix
I hereto shall have the respective meanings assigned to such terms in Appendix
I hereto, which is incorporated herein and made a part hereof.


 


1.2      Rules of
Interpretation. In this Agreement: (a) references to Sections and to
Exhibits are, unless otherwise indicated, to Sections of and Exhibits to this
Agreement; (b) the headings to Sections and Articles of this Agreement are
for ease of reference only and shall not in any way affect its construction or
interpretation; (c) the masculine gender shall include the feminine and
neuter and the singular number shall include the plural, and vice versa, and
references to persons shall include individuals, bodies corporate,
unincorporated associations, companies and partnerships; and


 


1

















 


(d) references
to Parties in this Agreement shall be deemed to include references to their
successors and permitted assigns.


 


ARTICLE 2


 


SUPPLY AND
OTHER OBLIGATIONS OF SUPPLIER


 


2.1      Supply and
Commissioning Obligations. Purchaser hereby agrees to purchase and, subject
to the terms and provisions hereof, Supplier agrees to supply and Deliver as
provided in Subsections (a) and (b) below, the Supply Items and
related Services for the Turbines. With respect to the Supply Items and related
Services, following Purchaser’s submittal to Supplier of the Down Payment, and
subject to the compliance by Purchaser with the terms hereof, Supplier agrees
to do the following respecting the Supply Items and Services:


 


(a)        supply,
pack, and Deliver, in accordance with wind industry practice and commercially
reasonable shipping carrier requirements and in an economic manner consistent
with wind industry practices, all Supply Items, the SCADA System and all
related components and parts (other than foundations, foundation bolts, pad
mount transformers and collection lines, communication lines and related
equipment to be supplied by Purchaser) necessary to install and commission wind
turbine generators in the quantity set forth above that are capable of
performing to the Turbine Specifications (the “Supply Obligations”);


 


(b)        perform
the Commissioning Work, as described in Section 6.2 below.


 


2.1.1          Failure to Timely
Deliver Down Payment. If Purchaser fails to deliver to Supplier the Down
Payment on or before the Down Payment Date, then Purchaser’s right to purchase
and Supplier’s obligation to sell and Deliver the Supply Items and related
Services shall terminate at the option of Supplier and be of no further force
or effect, provided that Supplier shall first give Purchaser five (5) days
written notice to afford Purchaser the opportunity to correct its performance.


 


2.1.2          Spare Parts.


 


(a)        During
the Warranty Period, Supplier shall maintain an inventory of spare parts at
such location and consisting of such spare parts as Supplier, in its sole
discretion, shall determine necessary for the timely operation and maintenance
of the Turbines during the Warranty Period (the “Necessary Spare Parts
Inventory”). The list of spare parts proposed by Supplier is attached hereto as
Exhibit C. It is the intention of the parties that the Necessary
Spare Parts Inventory be used and maintained during the Warranty Period in
order for Supplier to fulfill its obligations under the OMS Agreement and the
Warranty Agreement.


 


(b)        Purchaser
may purchase such additional spare parts, at Purchaser’s sole expense, and
maintain such additional spare parts on the Project Site, at Purchaser’s sole
expense; provided that such spare parts are available from Supplier without
unreasonably impacting Supplier’s production of turbines.


 


2

















 


(c)         Within
six (6) months of the date of final payment by Purchaser to Supplier of
the Purchase Price, Supplier shall place into escrow with an escrow agent to be
agreed upon between the parties, subject to an escrow agreement to be agreed
between the parties, drawings (the “Spare Part Drawings”) necessary for
Purchaser to make or have made any spare parts for the Turbines whose
manufacture are subject to intellectual property rights of Supplier. Pursuant
to the terms of the agreed upon escrow agreement, Purchaser shall be provided access
to the Spare Parts Drawings only if and when Supplier is unable to provide
necessary spare parts for the Turbines to Purchaser due to a default under Section 14.1(i),
(ii), (iii) or (iv) under this Agreement.


 


2.1.3          SCADA System.
Purchaser shall purchase the SCADA System from Supplier (exclusive of any fiber
optic lines or other communication lines) for an amount equal to ***** Dollars ($*****). The price of the SCADA System is included in
the Purchase Price.


 


2.1.4          [Intentionally
Left Blank].


 


2.1.5          Other Items.
Supplier has provided Purchaser with: the Turbine Installation Manual, a copy
of which is set forth on Exhibit D; the Foundation Loads Document,
a copy of which is set forth on Exhibit E; and the Turbine
Component Storage Requirements, a copy of which is set forth on Exhibit F.
No later than ten (10) days prior to the anticipated Commissioning of the
first Turbine, Supplier shall provide to Purchaser the OMS Manual. Concurrently
with the execution of this Agreement, Supplier and Purchaser shall deliver to
the other Party the Warranty Agreement and the OMS Agreement, duly executed by
each Party. At Purchaser’s request and at Purchaser’s cost, within twelve (12)
months of Commissioning of the last Turbine, Supplier shall provide to
Purchaser a location specific site suitability certificate from Germanischer
Lloyd.


 


2.2      Permits; Governmental
Requirements. Supplier shall secure and pay for all Supplier Permits
required for the Delivery of the Supply Items to the Designated Delivery
Location. Purchaser shall cooperate with Supplier in obtaining the Supplier
Permits. Supplier shall have no obligation to obtain any Purchaser Permit;
provided Supplier shall cooperate with Purchaser in Purchaser’s efforts to
obtain and comply with Purchaser Permits. Supplier shall comply with all
Governmental Requirements applicable to the performance of its obligations
hereunder.


 


2.3      Purchaser’s Right to
Inspect. Supplier shall permit Purchaser, upon ten (10) days prior
written notice to Supplier, to inspect the Turbines and to visit Supplier’s
Turbine manufacturing and assembly facilities for such purpose, subject in all
cases to Supplier’s confidentiality requirements and reasonable safety
precautions, and so long as such inspection and presence does not unreasonably
interfere with or delay the completion or Delivery of the Turbines or Supplier’s
performance of its obligations hereunder.


 


2.4      Subcontractors.
Supplier may retain such Subcontractors as in Supplier’s reasonable judgment
may be necessary to complete Supplier’s duties and obligations under this
Agreement. Supplier shall be solely responsible to pay its Subcontractors and
the use of any Subcontractor shall not limit Supplier’s obligations hereunder.
The list of Supplier’s Major Turbine Component suppliers is set forth on Exhibit H.
Supplier agrees that it will not use any Major Turbine


 


3

















 


Components
not listed on Exhibit H without Purchaser’s advance written consent,
such consent not to be unreasonably withheld, conditioned or delayed.


 


2.5      Safety. Until any Supply Item has
been Delivered, Supplier shall take reasonable steps to protect each Supply
Item against damage, destruction or theft, and shall ensure that all Supplier
Insurance covering the Turbines remains in full force and effect prior to
Delivery.


 


2.6      Independent Contractor. In
performing its duties and obligations under this Agreement, Supplier shall, at
all times, act in the capacity of an independent contractor, and shall not in
any respect be deemed (or act as) an agent of Purchaser for any purpose or
reason whatsoever. Supplier shall have no responsibility for any of Purchaser’s
Work hereunder.


 


ARTICLE 3


 


PURCHASE PRICE AND PAYMENT


 


3.1      Purchase Price. For the Supply
Items, SCADA System and Services, Purchaser shall pay to Supplier ***** Dollars ($*****) (the “Purchase Price”).
Purchaser shall pay to Supplier on the date of this Agreement (the “Down
Payment Date”) a non-refundable amount equal to ***** percent (*****%) of the
Purchase Price (the “Down Payment”). All payments to be made under this
Agreement by Purchaser to Supplier shall be made in immediately available funds
to the Supplier account set forth in Exhibit I. The Purchase Price
is subject to adjustment by Change Order as provided in this Agreement.


 


3.2      Taxes. Supplier shall be
responsible for (a) all federal and state income taxes payable by Supplier
in connection with its net income, (b) all taxes in connection with the
import of any Supply Item into the United States, and (c) any business
license or fees arising in connection with Supplier’s business in any State.
Purchaser shall be responsible for all sales and use tax and any other federal,
state or local taxes imposed on the sale or use of the Supply Items and any
services provided hereunder (collectively “Taxes”).


 


3.3      Progress Payments.


 


3.3.1          The remaining amount of the Purchase
Price shall be paid by the Purchaser to the Supplier pursuant to the Payment Schedule
set forth on Exhibit B attached hereto (the “Payment Schedule”).
Upon completion of each of the milestones for the Project set forth on Exhibit B
attached hereto, the corresponding portion of the Purchase Price shall be due
and payable to Supplier as set forth on Exhibit B attached hereto
(each, a “Progress Payment”).


 


(a)       Purchaser shall pay the Down Payment and
each Progress Payment to Supplier in United States Dollars and in immediately
available funds to the account of Supplier, identified on Exhibit I.
Should Purchaser fail to make any Progress Payment when due, in addition any
other remedy available to Supplier under this Agreement, or otherwise, (i) Supplier
may enforce the Guaranty as set forth in Section 3.5 pursuant to
its terms; (ii) such overdue amount shall bear interest until paid in full
at the Default Rate, and (iii) Supplier may,


 


4

















 


without prejudice to any
other rights or remedies it may have under this Agreement, stop its performance
hereunder until the overdue amount and interest thereon is paid in full.


 


(b)  Provided that Supplier has duly performed or
is reasonably performing its obligations hereunder and irrespective of any
other term of this Agreement, and provided that any delay in obtaining the
Project Completion Certificate within six (6) months after Delivery of the
last Major Turbine Component by Supplier for the Project is not caused solely
by Supplier or any of Supplier’s Affiliates or subcontractors, one hundred
percent (100%) of the Purchase Price, subject to the retention of the
applicable Punch List Retainage, shall be paid by Purchaser to Supplier no
later than six months after Delivery of the last Major Turbine Component by
Supplier for the Project.


 


3.4      Punch List Retainage. In delivering
the Project Completion Certificate as provided in Section 6.3 below
hereunder, Supplier shall include an estimated cost to complete each item of
Punch List Work (200% of such estimated costs being the “Punch List Retainage”).
The Progress Payment corresponding to delivery of the Project Completion
Certificate shall be decreased by an amount, if any, which is equal to the
Punch List Retainage, and upon the completion of any item of Punch List Work to
the reasonable satisfaction of Purchaser, Purchaser shall immediately pay
Supplier the Punch List Retainage that was retained by Purchaser for such item
of Punch List Work.


 


3.5      Purchaser’s Credit Support.
Purchaser shall, concurrently with the delivery by Purchaser of the Down
Payment, deliver to Supplier a guaranty from its parent company (the “Guaranty”)
in substantially the form attached hereto as Exhibit J.


 


3.6      Warranty Agreement. The Parties
acknowledge that, concurrent with the execution of this Agreement, the Parties
shall enter into the Warranty Agreement. The cost of the first two (2) years of
warranty coverage under the Warranty Agreement is included in the Purchase
Price. 


 


3.7      Operations and Maintenance Service
Agreement. Concurrent with the execution of this Agreement, Affiliates of
the Purchaser and Supplier shall execute an OMS Agreement whereby Supplier, an
Affiliate of Supplier, or a contractor designated by Supplier and approved by
Purchaser (the “Contractor”), shall provide operation and maintenance service
to the Project. Pursuant
to the terms of the OMS Agreement, the cost for the first two (2) years of OMS
Services (other than Additional OMS Services) is included in the Purchase
Price. 


 


ARTICLE 4


 


DUTIES AND OBLIGATIONS OF PURCHASER


 


4.1      Purchaser’s Obligations. Purchaser
agrees to perform the following, all on the terms and subject to the conditions
of this Agreement:


 


4.1.1          Payment. Purchaser shall make
the Down Payment, all Progress Payments and any other payments due Supplier
under this Agreement when due and shall be responsible for and promptly pay all
Taxes.


 


4.1.2          Purchaser’s Work. Purchaser
shall, at its sole cost and expense, be solely responsible for all work
necessary for the development, construction, completion and operation


 


5

















 


of the Project (other
than the Delivery of Supply Items and the performance of the Services by
Supplier) and for the installation and operation of the Turbines, which work
(herein “Purchaser’s Work”) shall include the following:


 


(a)       Site Suitability and Access.
Purchaser shall ensure that the Project Site is suitable for installation of
the Turbines in accordance with the Turbine Specifications and Turbine
Installation Manual and shall ensure that Supplier has continuous unfettered
physical access to the Project Site during normal business hours during the
performance of its Commissioning Work;


 


(b)       Acceptance and Shipment of Supply
Items. Upon Supplier’s Delivery of any Supply Item to its respective
Designated Delivery Location, Purchaser shall, unless otherwise agreed by the
Parties, within five (5) days after notice from Supplier and at such date
and time set forth in Supplier’s notice, pick up the Supply Item at its
Designated Delivery Location, and ship, install or store such Supply Item at
the Project Site. Purchaser shall be responsible for any reasonable costs
incurred by Supplier due to Purchaser’s delay in promptly picking up and
transporting off site any Supply Item upon its Delivery within said five (5) day
period. Purchaser shall be solely responsible for shipment and insurance of
each Supply Item once picked up;


 


(c)        Storage. Purchaser shall ensure
that adequate staging, lay down and storage areas for the Supply Items are
available and maintained at the Project Site and shall store and maintain the
Supply Items pending installation in accordance with the Turbine Component
Storage Requirements set forth on Exhibit F;


 


(d)       Tower Foundations. Purchaser shall
investigate the Project Site and its soil conditions and shall design and
construct the Tower Foundations in accordance with Supplier’s Tower Foundation
Requirements;


 


(e)        Turbine and SCADA System Installation.
Purchaser shall perform the Turbine Installation Work and the installation of
the SCADA System, all in strict accordance with the Turbine Specifications, the
Turbine Installation Manual and the SCADA System Installation Manual; and shall
(i) notify Supplier of Purchaser’s proposed schedule for all such work; (ii) coordinate
such work with Supplier’s Commissioning Work for the Turbines; and (iii) complete
the Installation Work in such a manner so that a team of two technicians can
complete the Commissioning of each Turbine within a period not to exceed three
and a half (3 1/2) Business Days, without interruption or delay on a continuous
basis until all Turbines have been Commissioned;


 


(f)        Construction of Project.
Purchaser shall (i) perform the Final Assembly Work which is set forth in Exhibit P
hereto (ii) perform all civil works (including roads, grading, maintenance
facilities, meteorological towers and other items); (iii) perform all
electrical works (including collection lines, Electrical Infrastructure,
Transmission Facilities, Interconnection Facilities and other items); (iv) provide
and install a remote terminal unit and cabling to the Substation,
meteorological towers, and communications lines for the SCADA System to the
Substation; and (v) provide any other items required for the operation of
the Project; and


 


6














 


(g)       Commissioning Responsibilities.
Purchaser shall ensure that at all times during Commissioning Work, each
Turbine shall have a continuous supply of electricity from the grid, and that
Purchaser’s utility will accept electricity generated by such Turbine. During
Commissioning, Purchaser shall provide assistance, including equipment,
electricians and mechanics, as may be reasonably required by Supplier to
address any out of scope impacts on the completion of Commissioning. Purchaser
shall arrange for the provision of full grid power to each Turbine to ensure
completion of the Commissioning Work for each Turbine.


 


4.1.3           Other Items. On or before the
date that is thirty (30) days prior to the date of Delivery of the first Major
Turbine Component for the Project, Purchaser shall provide Supplier with
notification of the anticipated date that Purchaser will energize the
substation for the Project.


 


4.2       Cooperation with Supplier; Purchaser’s
Representative. Purchaser shall cooperate with Supplier and, if applicable,
shall cause its EPC Contractor and any other contractors engaged by Purchaser
with respect to the Project (herein, “Purchaser’s Contractors”), to cooperate
with Supplier, all in connection with Supplier’s performance of its obligations
hereunder. Purchaser shall promptly provide Supplier with a schedule of the
names and contact information for all of Purchaser’s Contractors and shall
update such schedule periodically. Purchaser designates Scott Rowland as its
representative (“Purchaser’s Representative”) in dealing with Supplier with
respect to this Agreement.


 


4.3       Permits; Governmental Requirements.
Purchaser shall secure and pay for all Purchaser Permits, including any permits
required for the delivery of Supply Items from the Designated Delivery Location
to the Project Site. Supplier shall cooperate with Purchaser in obtaining
Purchaser’s Permits. Purchaser shall have no obligation to obtain any Supplier
Permit; provided that, Purchaser shall cooperate with Supplier in Supplier’s
efforts to obtain Supplier Permits. Purchaser shall comply with all
Governmental Requirements applicable to the performance of Purchaser’s Work.


 


4.4       Safety. Upon Delivery of any
Supply Item to its Designated Delivery Location, Purchaser shall take
reasonable steps, and shall ensure that the EPC Contractor and the Purchaser’s
Contractors take reasonable steps, to protect any such Supply Item against
damage or theft.


 


4.5       Intellectual Property Rights: Licenses
and Obligations.


 


4.5.1           Patents. Supplier hereby
grants to Purchaser under Supplier’s patent rights, only the non-exclusive
right to use the Supply Items provided to Purchaser under this Agreement.
Supplier expressly reserves all other patent rights, including, without
limitation, the right to make, use, sell, offer for sale and import other
products identical to or similar to the Supply Items. Other than the rights
granted herein with respect to the Supply Items, Supplier expressly reserves
all other patent rights, and Purchaser shall not have the right under Supplier’s
patent rights to make, use, sell, offer for sale, or import any products or
methods that infringe Supplier’s patents or to sublicense any of the foregoing
rights.


 


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4.5.2           Trade Secrets. Purchaser
acknowledges that the technical, operation and maintenance, and other
information it receives in connection with the Supply Items (including, without
limitation, any and all firmware, software, Turbine Specifications, SCADA
System Specifications, installation and operation and maintenance procedures,
know-how and similar items) constitute trade secret information that is
proprietary to Supplier. Supplier hereby grants to Purchaser under Supplier’s
trade secret rights, the non-exclusive right to use such trade secrets only in
the installation and operation and maintenance of the Supply Items. Supplier
further grants to Purchaser under Supplier’s trade secret rights, the
non-exclusive right to disclose such trade secrets to a third party only as
necessary for the financing, installation and operation and maintenance of the
Supply Items provided such third party executes a written agreement obligating
it to maintain the confidentiality of the trade secret information and to
return all copies of such trade secret information received and prohibiting
reverse engineering, disassembly, and decompilation of any of the trade secret
information. Other than the rights granted herein with respect to the Supply
Items, Supplier expressly reserves all other trade secret rights. Purchaser
agrees to maintain all such trade secret information in strict confidence and
shall not disclose such trade secret information to any third party except in
accordance with this Section 4.5.2. The obligations of
confidentiality herein shall survive termination or expiration of this
Agreement.


 


4.5.3           Copyrights. Purchaser
acknowledges that the technical, operation and maintenance, and other
information it receives in connection with the Supply Items (including, without
limitation, any and all firmware, software, Turbine Specifications, SCADA
System Specifications, installation and operation and maintenance procedures,
descriptions of know-how and similar written items) constitute copyrightable
material. Supplier hereby grants to Purchaser under Supplier’s copyrights, the
non-exclusive right to copy and use such copyrighted materials only in the
installation and operation and maintenance of the Supply Items. Supplier
further grants to Purchaser under Supplier’s copyrights, the non-exclusive
right to copy the copyrightable materials and distribute such to a third party
only as necessary for the installation and operation and maintenance of the
Supply Items, provided such third party executes a written agreement obligating
it to return all copies of such copyrightable materials received, prohibiting
any further copying or distribution of such copyrightable materials, and
prohibiting reverse engineering, disassembly and decompilation of any of the
copyrightable materials. Other than the rights granted herein with respect to
the Supply Items, Supplier expressly reserves all other copyright rights.
Purchaser shall not have the right to sublicense any of the Supplier’s
copyright rights or the right to create derivative works of any of the
copyrightable materials. Purchaser shall not reverse engineer, disassemble or
decompile any of the copyrightable materials.


 


4.5.4           Trademarks and Service Marks.
Purchaser shall not have any rights in any trademarks or service marks, whether
registered or not, that are owned or controlled by Supplier. Purchaser shall
not utilize any trademark or service mark that is substantially similar to any
trademarks or service marks owned or controlled by Supplier. Purchaser may
reference only those trademarks or service marks owned by Supplier in its
written materials; provided that, such reference clearly denotes that such is a
trademark or service mark and is owned by Supplier.


 


4.5.5           Transfer of Title in Supply Items.
Should Purchaser transfer title in any of the Supply Items to a third party,
the licenses provided in this Section 4.5 shall run with such
Supply Items, provided such third party executes a Transferee Agreement and
Acknowledgment, in the form attached hereto as Exhibit K,
acknowledging Supplier’s ownership in the respective


 


8

















 


Intellectual Property
Rights and obligating itself to all of the same prohibitions and restrictions
with respect to Supplier’s Intellectual Property Rights described in this Section 4.5.
Purchaser acknowledges that the Supply Items may be subject to the export
control laws and regulations of the United States of America and agrees to
comply with all such laws and regulations regarding any export of any of the
Supply Items.


 


4.5.6           Ownership and Injunctive Relief.
All Intellectual Property Rights owned or controlled by Supplier shall remain
the exclusive property of Supplier and nothing herein shall be construed as a
sale, lease, loan, or transfer of any of such Intellectual Property Rights.
Purchaser shall derive no rights, title or interest therein except as expressly
set forth in this Agreement. Any technical information concerning the Supply
Items that Purchaser acquires or develops in connection with the ownership or
operation of the Turbines shall be the property of Supplier. Further, Purchaser
acknowledges that a breach of the confidentiality provisions in this Agreement
may cause Supplier irreparable harm and damage that may not be recoverable at
law and that Purchaser shall be entitled to obtain injunctive relief in
addition to any other rights or remedies Purchaser may have.


 


4.5.7           Government Rights. Any and all
computer software and related documentation provided as part of the Supply
Items are “commercial items” as that term is defined at 48 C.F.R. 2.01 (October 1995)
comprising “commercial computer software” and “commercial computer software
documentation” as used in 48 C.F.R. 12.212 (September 1995) and other
applicable acquisition regulations and are provided to the U.S. Government only
as a commercial item and subject to the terms and conditions and all
restrictions set forth in this Agreement as applicable to such computer
software and related documentation. Consistent with 48 C.F.R. 12.212 and 48
C.F.R. 227.7202 (June 1995), all U.S. Government users and licensees
acquire the software and its related documentation with only those rights
applicable to such software and related documentation as set forth in this Section 4.5.


 


4.6       Transfer. Purchaser covenants and
agrees that it will not sell, lease or otherwise transfer the Turbines or any
part thereof unless Purchaser first obtains and delivers to Supplier a
Transferee Agreement and Acknowledgment, executed by the proposed transferee.
Notwithstanding anything else contained herein, Purchaser may assign in whole
or in part its rights under this Agreement to an Affiliate upon notice to
Supplier.


 


4.7       Access to Information. From the
date of this Agreement through the end of the fifteenth (15th) year after
Project Completion, Purchaser shall provide to Supplier prompt access to all
technical, operational and maintenance and other information it receives or
collects in connection with its operating the Turbines. The collection of all
such data shall be at the reasonable expense of Supplier. All information provided
by Purchaser hereunder shall be subject to the provisions of Section 16.9.


 


ARTICLE 5


 


COMMENCEMENT, DELIVERY AND SHIPMENT


 


5.1       Commencement. Subject to Section 2.1.1,
Supplier shall commence performance of its obligations under this Agreement on
the Down Payment Date. In addition to Supplier’s other


 


9

















 


rights and remedies
hereunder, if any payment due under this Agreement is not timely made by
Purchaser, the delinquent payment amount shall accrue interest at the Default
Rate.


 


5.2       Shipping Arrangements. All Supply
Items shall be delivered Ex Works at the Designated Delivery Locations. For
purposes of this Agreement, each individual Supply Item and the SCADA System
shall be deemed “Delivered” and Supplier shall have satisfied its delivery
arrangements with respect thereto, when Supplier makes available such Supply
Item and SCADA System at its Designated Delivery Location for pick up by
Purchaser, provided however, that Purchaser may not take custody and control of
the said Supply Item until the applicable Progress Payment has been made by
Purchaser and received by Supplier. Purchaser shall be responsible for all
loading and shipment of the Supply Items and SCADA System from their respective
Designated Delivery Locations to the Project Site and shall pay for all costs
and expenses incurred by Purchaser related thereto, including the costs of
maintaining insurance on such Supply Item and SCADA System during shipment of
such Supply Item and SCADA System from its respective Designated Delivery
Location to the Project Site.


 


5.3       Delivery Schedule. The Supply
Items shall be Delivered to their Designated Delivery Locations in accordance
with the Delivery Schedule attached as Exhibit L (the “Delivery
Schedule”); provided however, that Supplier shall use commercially reasonable
efforts to work with Purchaser to revise the Delivery Schedule as necessary
considering Supplier’s manufacturing schedules and Purchaser’s Project
requirements. Delivery dates in the Delivery Schedule will be deemed met so
long as the Supply Items are delivered to the Designated Delivery Locations on
or before the date for such delivery set forth in the Delivery Schedule;
provided that, Supplier shall have the right to Deliver the Supply Items up to
one (1) month earlier than provided for in the Delivery Schedule. The
SCADA System shall be delivered at a Designated Delivery Location mutually
agreed by the Parties following the installation of the first Turbine at the
Project Site by Purchaser.


 


5.4       Designated Delivery Locations.
Unless otherwise agreed in writing by the Parties, Supplier shall Deliver the
Supply Items as follows: (i) Turbine Nacelle, Turbine Controller, Turbine
hub and Ancillary Parts and Equipment at Supplier’s factory near Cedar Rapids,
Iowa, (ii) the Turbine Blades at such location or warehouse facility as
Supplier may direct near Houston, Texas, or at another mutually agreed upon
location, provided any costs associated with such other mutually agreed
location be borne by Purchaser, and (iii) the Towers at the manufacturing
facility located in Chattanooga, Tennessee, or at such other domestic location
as Supplier may specify at any point prior to three (3) months from the
Delivery date set forth in the Delivery Schedule. Each of the foregoing
locations is referred to herein as a “Designated Delivery Location.”


 


5.5       Delay Delivery Damages. The
Parties acknowledge that Purchaser will suffer damages that will be difficult
to ascertain if Purchaser fails to Deliver any Major Turbine Component within thirty (30) days of the applicable date
of Delivery set forth in the Delivery Schedule. Consequently, the Parties agree
that Supplier will pay Purchaser, if any Major Turbine Component is Delivered thirty (30) days or more late and such
delay was not due to any Force Majeure Event or breach by Purchaser of any of
its obligations under this Agreement, the following amount as liquidated
damages: For each full day after the first thirty (30) days following the date that the Delivery of such
Major Turbine Component is delayed beyond the date specified in the Delivery
Schedule, an amount equal to $***** per
Turbine per day for the first fifteen (15) days after


 


10

















 


delay
payments become payable, an amount equal to $***** per day for the next fifteen (15) days, and an amount equal to $*****
per day thereafter (the
“Delay Delivery Damages”); provided that, in no event shall the aggregate Delay
Delivery Damages payable hereunder exceed ***** percent (*****%)
of the pro-rata portion of the Purchase Price applicable to the Turbine for
which such delayed Major Turbine Component is a component. It is understood and
acknowledged by the Parties that if more than one Major Turbine Component
applicable to a Turbine is delivered late, the liquidated damages applicable to
the Turbine will not exceed $***** per day (for the first 15 days after delay
payments become payable), $***** per day (for the next 15 days of delay
payments), and $***** per day (for delay payments thereafter) as
applicable. The Parties acknowledge and agree that the Delay Delivery Damages
set forth above are a reasonable estimate of the damages Purchaser will suffer
because of late Delivery of any Major Turbine Component and that, therefore,
the Delay Delivery Damages set forth herein shall be Purchaser’s sole and
exclusive remedy with respect to such Delivery delays.


 


ARTICLE 6


 


FINAL ASSEMBLY WORK, INSTALLATION
WORK, 

COMMISSIONING WORK AND PROJECT COMPLETION


 


6.1       Final Assembly Work and Turbine Installation.
Purchaser shall complete the Final Assembly Work with respect to all Turbines
in conformance with the procedures and requirements set forth in Exhibit P,
and shall complete the Installation Work with respect to all Turbines in
accordance with the Installation Procedures and, subject to Section 5.3
above, within the period of time set forth on the Completion Schedule.


 


6.2       Commissioning. Commissioning of
the Turbines shall be conducted as follows:


 


6.2.1           Advance Completion Notice. No
less than thirty (30) days prior to the date Purchaser expects Supplier to
commence the Commissioning Work, Purchaser shall provide Supplier with written
notice (the “Advance Completion Notice”) of Purchaser’s anticipated completion
date of the Installation Work and the date on which Supplier shall commence the
Commissioning Work (which date shall be no later than the date that Supplier is
obligated to commence the Commissioning Work as set forth in the Completion
Schedule). Purchaser shall use commercially reasonable efforts to schedule
Turbine Installation for all Turbines in the Project so that Supplier can
complete the Commissioning of each Turbine without interruption or delay on a
continuous basis until all the Turbines have been Commissioned.


 


6.2.2           Turbine Installation Inspection.
Following completion of the Installation Work with respect to any Turbine,
Purchaser shall deliver a written notice of completion to Supplier (an “Installation
Completion Notice”) and Supplier shall examine each Turbine in accordance with
the Installation Procedures and the Turbine Installation Manual. If the Turbine
fails to conform to the standards contained in the installation inspection
procedures set forth in the Turbine Installation Manual, then it shall be
deemed not properly installed, and Supplier shall promptly so notify Purchaser.
Purchaser shall then promptly take all required action to complete the
Installation Work for all Turbine(s) failing the installation inspection
procedures.


 


11

















 


6.2.3           Commissioning Work. Supplier
shall perform the Commissioning Work for the Turbines in accordance with the
Commissioning and Start-Up Procedures and the Completion Schedule, subject to
any adjustment in the completion of the Commissioning Work, pursuant to Section 5.3
hereof, due to Supplier’s early Delivery of the Supply Items (provided,
however, that Supplier’s obligation to Complete the Commissioning Work by such
time set forth on the Completion Schedule shall be extended to the extent of Purchaser’s
delay in completing the Installation Work). Upon completion of the
Commissioning of each Turbine, Supplier shall issue to Purchaser a
commissioning certificate for such Turbine in the form attached hereto as Exhibit M
(each a “Commissioning Certificate”). Within five (5) days after receipt
of a Commissioning Certificate, Purchaser shall either approve such
Commissioning Certificate or deliver to Supplier written notice of any work
remaining to be completed by Supplier (the “Punch List Work”). If Purchaser
fails to deliver such notice within such five (5) day period, the
Commissioning Certificate will be deemed approved by Purchaser.


 


6.3       Project Completion. Within five (5) days
after the delivery by Supplier to Purchaser of a Commissioning Certificate for
the Project’s final Turbine, Supplier shall also deliver to Purchaser a
completion certificate for all Turbines in the Project (the “Project Completion
Certificate”), in the form attached hereto as Exhibit N, together
with a list of any remaining Punch List Work on any Turbine, a schedule for
completing the Punch List Work and an estimate of the cost of each item of
Punch List Work. Supplier shall thereafter promptly complete all Punch List
Work.


 


6.4       Purchaser Delays. In the event
that any of the actions of Purchaser, the EPC Contractor or any of Purchaser’s
Contractors cause a delay in the performance by Supplier of the Commissioning
Work, Purchaser shall pay Supplier its actual documented costs directly
attributable to such delay, including wages, lodging and meals.


 


ARTICLE 7


 


FORCE
MAJEURE EVENTS


 


7.1       Excused Performance. If either
Party is rendered wholly or partially unable to perform its obligations (other
than payment obligations) under this Agreement due to the occurrence of a Force
Majeure Event, such Party will be excused from the affected performance
obligation (other than payment obligations), provided that:


 


(a)        the affected Party gives the other Party
notice describing the particulars of the occurrence, including an estimate of
its expected duration and probable impact on the affected Party’s obligations
hereunder, such notice shall be given promptly after becoming aware of the
occurrence of the Force Majeure Event, and, in no event more than seven (7) days
after the affected Party becomes aware or should reasonably have been aware of
such occurrence;


 


(b)       the affected Party shall continually
exercise all commercially reasonable efforts to mitigate the effect of such
Force Majeure Event, remedy its inability to perform, and limit damages to the
other Party and shall promptly resume its


 


12

















 


performance when the
Force Majeure Event no longer impacts its ability to perform, and shall give
the other Party prompt notice of its intent to resume such performance;


 


(c)        the
suspension of a Party’s performance affected by the Force Majeure Event shall
be of no greater scope and of no longer duration than is reasonably required by
the Force Majeure Event;


 


(d)       no
liability of either Party which arose before the occurrence of the Force
Majeure Event shall be excused as a result of the occurrence thereof; and


 


(e)        no
Force Majeure Event shall relieve any Party from performing those of its
obligations that are not materially affected by the Force Majeure Event.


 


ARTICLE 8


 


CHANGE ORDERS


 


8.1       Change Order. The
term “Change Order” as used herein shall mean a written instrument signed by
Purchaser and Supplier, stating their mutual agreement upon any of the
following: (i) a change in the fabrication or features of the Turbines
(such as adding Federal Aviation Administration lighting or a cold weather
package); (ii) a change in the Delivery Schedule or Completion Schedule; (iii) a
change in the Commissioning Work; (iv) a change in the number of or
location of Project sites; or (v) an adjustment in the Purchase Price
(collectively “Scope Changes”).


 


8.2       Change Order Process.
Purchaser may request Scope Changes within the general scope of this Agreement
consisting of additions, deletions, or other revisions. If Purchaser so desires
to request Scope Changes, it shall submit a change request to Supplier in
writing. Within ten (10) Business Days after its receipt of any such
request, Supplier shall submit a detailed proposal to Purchaser stating (a) the
increase or decrease, if any, in the Purchase Price which would result from
such change, and (b) the effect, if any, upon the Delivery Schedule or
Completion Schedule by reason of such proposed change. Purchaser shall have
five (5) days from receipt of Supplier’s detailed proposal to accept or
reject in writing Supplier’s proposal in relation to the requested change. If
Purchaser agrees with Supplier’s proposal, Purchaser and Supplier shall execute
a Change Order reflecting the requested Scope Changes and proposed adjustments,
if any, in the Purchase Price and the Delivery Schedule or Completion Schedule.
In the event Purchaser disagrees with Supplier’s proposal, Purchaser shall
promptly so notify Supplier, following which the Parties shall negotiate in
good faith a solution which is satisfactory to both Purchaser and Supplier.
Should Purchaser fail to respond to Supplier in writing within the foregoing
five (5) day period, Purchaser shall be deemed to have withdrawn its
requested change.


 


8.3       No Change.
Notwithstanding anything to the contrary contained in this Agreement, Supplier
shall not be obligated to proceed with any Scope Changes requested by Purchaser
unless and until a Change Order is executed by the Parties in relation to such
change. Further, Supplier shall not be required to implement a requested Scope
Change by Purchaser if the implementation of such change would, in Supplier’s
reasonable opinion, likely impair Supplier’s ability to achieve any


 


13

















 


of the performance
guarantees, warranties or covenants set forth in this Agreement, the OMS
Agreement, and/or the Warranty Agreement.


 


8.4       Scope Changes Caused by a Force
Majeure Event. If a Force Majeure Event occurs that materially adversely
affects Supplier’s performance of all or a portion of the sale and Delivery
obligations hereunder or if such a Force Majeure Event causes any of the
Commissioning Work to be temporarily or permanently prevented, Supplier shall
be entitled to a Change Order reflecting such impact of such Force Majeure
Event, including an extension in Supplier’s time for performance for such delay
to the extent Supplier’s performance is actually delayed. In the case of a
Force Majeure Event, Supplier must notify Purchaser of Supplier’s intent to
request a Change Order (the “Notice of Intention”) within thirty (30) Business
Days of the Force Majeure Event. Supplier shall submit to Purchaser a draft
Change Order outlining, with reasonable specificity, the requested Scope
Changes within ten (10) Business Days after the Notice of Intention is
delivered to Purchaser.


 


8.5       Scope Changes Caused by Events within
the Control of Purchaser. If Purchaser, EPC Contractor or any of Purchaser’s
Contractors causes an event that materially adversely affects Supplier’s performance
of all or a portion of the sale and Delivery obligations hereunder or if such
event causes the Commissioning Work to be temporarily or permanently prevented,
Supplier shall be entitled to a Change Order reflecting such impact of such
event, including (i) an extension in Supplier’s time for performance for
such delay to the extent Supplier’s performance is actually delayed, and (ii) an
increase in the Purchase Price with respect to such additional cost to the
extent such delay is caused solely by Purchaser, EPC Contractor or any of
Purchaser’s Contractors. In the case of such a Purchaser caused event, Supplier
must notify Purchaser of Supplier’s intent to request a Change Order (the “Notice
of Intention”) within thirty (30) Business Days of the Purchaser caused event.
Supplier shall submit to Purchaser a draft Change Order outlining, with
reasonable specificity, the requested Scope Changes within ten (10) Business
Days after the Notice of Intention is delivered to Purchaser.


 


ARTICLE 9


 


LIMITATION OF LIABILITY


 


9.1       Supplier Not Responsible for Purchaser’s
Work. Notwithstanding anything to the contrary set forth herein, Supplier
shall not have any responsibility for (a) Project Site selection,
permitting or Turbine siting within the Project Site; (b) the design,
supply or construction of Tower foundations; (c) the assembly, erection
and installation of the Turbines or the SCADA System; (d) the design,
assembly, erection and installation of any other element of the Project, (e) obtaining
rights required by the Project to sell or transmit its electrical output, or (f) any
other element of Purchaser’s Work, all of which are expressly the
responsibility of Purchaser.


 


9.2       Overall Limitation of Liability.
Notwithstanding anything to the contrary contained in this Agreement, in no
event shall Supplier, its parent company, Affiliates and agents be liable,
alone or in the aggregate, to Purchaser for any damages, claims, demands,
suits, causes of action, losses, costs, expenses and/or liabilities related in
any manner to this Agreement, the Warranty Agreement and the OMS Agreement in
excess of an amount equal to ***** percent (*****%) of the Purchase Price,
regardless of whether such liability arises out of breach of contract,
guarantee or warranty, tort, product liability, indemnity, contribution, strict
liability or any other legal theory;


 


14

















 


provided, however, the
preceding limitation of liability shall not apply to, and no credit shall be
issued against such liability for, (a) Supplier’s indemnity obligations
set forth in Section 13.1 solely as they relate to claims by third
Parties for bodily injury or property damage, or (b) the fraud or willful
misconduct of Supplier.


 


9.3       Consequential Damages.
Notwithstanding anything to the contrary contained in this Agreement and except
as set forth in the last sentence of this Section, Purchaser and Supplier waive
all claims against each other (and against each other’s parent company,
Affiliates, contractors, subcontractors, consultants, vendors, suppliers and
agents) for any consequential, incidental, indirect, special, exemplary or
punitive damages (including, but not limited to, loss of actual or anticipated
profits, revenues or product; loss by reason of shutdown or non-operation;
increased expense of operation, borrowing or financing; loss of use or
productivity; or increased cost of capital), and regardless of whether any such
claim arises out of breach of contract or warranty, tort, product liability,
indemnity, contribution, strict liability or any other legal theory. Any
consequential, incidental, indirect, special, exemplary or punitive damages
incurred by Supplier or Purchaser in relation to a third Party shall, for all
purposes of this Agreement, be deemed consequential, incidental, indirect,
special, exemplary or punitive damages in relation to any claim brought by
Supplier or Purchaser against the other Party to this Agreement. Any liquidated
damages payable by Supplier under this Agreement shall not be deemed consequential,
incidental, indirect, or special damages for purposes of this Agreement.


 


ARTICLE 10


 


TITLE AND RISK OF LOSS; INSURANCE


 


10.1     Title to Supply Items. Title to any
Supply Item shall transfer to the Purchaser upon (i) the Delivery of such
Supply Item to its Designated Delivery Location and (ii) Purchaser’s
payment of and Supplier’s receipt of, the applicable Progress Payment.


 


10.2     Risk of Loss. Supplier shall bear
the risk of loss and damage with respect to any Supply Item (including each
individual Major Turbine Component) until Delivery of such Supply Item to its
Designated Delivery Location. In performing the Commissioning Work, Supplier
shall be deemed a contractor of Purchaser performing the Services on Supply
Items then owned by Purchaser. Upon the Delivery of any Supply Item to its
Designated Delivery Location, care, custody and control of, and risk of loss or
damage to, such Supply Item shall thereupon transfer to the Purchaser.


 


10.3     Insurance. Supplier and Purchaser
shall maintain the following insurance while this Agreement is in effect:


 


10.3.1         Supplier Insurance.


 


Supplier shall carry and
maintain or cause to be carried and maintained, at all times during the Term of
this Agreement, insurance coverage with limits as set forth in this Section (the
“Supplier Insurance”).


 


15

















 


Marine
Cargo Insurance


 


All
property and interests of every kind and description (including materials,
equipment, machinery and spares) intended for the Project or subsequent
operations while in transit by land, air and/or sea. All Risks of physical loss
or damage from a cause not excluded but including war, strikes, riots and civil
commotions and terrorism while in transit, on a continuous open cover basis.
Increased cost of working - the additional expenditure necessarily and
reasonably incurred for the purpose of avoiding or reducing delay which,
without such expenditure would have taken place.


 


Property


 


At
all times the Supplier’s factory premises, plant, machinery, raw materials and
finished stocks all related to and comprising the Project under a property
insurance in an amount equal to the full replacement value of the above named
items for “all risks” of physical loss or damage including, but not limited to,
coverage for earth movement, flood, windstorm, earthquake, sabotage, terrorism,
riots, civil commotion, testing, boiler and machinery, transit and off-site
storage. The policy may contain separate sub limits and deductibles subject to
insurance company underwriting guidelines. Deductibles under the policy shall
not exceed $100,000 per occurrence, except for deductibles for natural
catastrophe peril, which shall not exceed five percent (5%) of the insured loss


 


Increased
cost of working - the additional expenditure necessarily and reasonably
incurred for the purpose of avoiding or reducing delay which, without such
expenditure would have taken place.


 


Workers Compensation


 


Coverage
shall comply with any statutory obligation imposed by Workers Compensation,
Occupational Disease Laws, or similar laws, including where applicable, the
United States Longshoremen’s and Harbor Workers’ Act, the Federal Employers’
Liability Act and the Jones Act. Employers’ Liability insurance shall have
limits of not less than $1,000,000 per accident, $1,000,000 disease-policy
limit and $1,000,000 disease-each employee.


 


Commercial General Liability


 


Insurance
providing coverage for bodily injury, property damage and personal/advertising
injury with a combined single limit of not less than $1,000,000 per occurrence
and $2,000,000 aggregate. The policy shall include contractual liability and
any testing operations coverage.


 


16














 


a.                         Automobile
Liability - Insurance for owned, non-owned and hired automobiles with a
limit of not less than $1,000,000 per occurrence.


 


b.                         Excess  liability -
Insurance with a minimum limit of $10,000,000 per occurrence and annual
aggregate.


 


c.                          Evidence and Scope of
Insurance - Supplier shall
provide Purchaser with a copy of insurance original certificates evidencing the
insurance coverages required and shall provide replacement certificates of
insurance within five (5) days of any renewal of the required insurance.


 


All
such insurance policies shall:


 


(i) name
Purchaser for their respective rights and interests in respect of the Project
as additional insured (except in the case of worker’s compensation insurance);


 


(ii) provide
Purchaser with 30 days’ prior written notice of non-renewal, cancellation of,
or significant modification to, any of such policies (except that such notice
period will be 10 days in case of non-payment of premiums); and


 


(iii) the
insurance certificates provided to Purchaser shall indicate that the insurance
policies have been endorsed as noted above. All policies shall be written by
one or more insurance companies authorized to do business in USA and be rated
BBB+ or higher by A.M. Best.


 


Term and Modification of Insurance


 


If
the designated coverage, or relatively comparable coverage, are unavailable on
reasonable commercial terms, Supplier will provide Purchaser detailed
information as to the maximum amount of available coverage that it is able to
purchase and will be required to obtain Purchaser’s consent as to the adequacy
of said coverage under the circumstances at the time, which consent shall not
be unreasonably withheld or delayed.


 


10.3.2         Purchaser Insurance.


 


Purchaser
shall carry and maintain or cause to be carried and maintained, at all times
during the Term of this Agreement, insurance coverage with limits as set forth
in this Section.


 


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Builder’s
All Risk Insurance


 


At all times during
construction, the Purchaser’s Project will be under a builder’s all risk
insurance in an amount equal to the full replacement value of the Project for “all
risks” of physical loss or damage including, but not limited to, coverage for
earth movement, flood, windstorm, earthquake, sabotage, terrorism, riots, civil
commotion, testing, boiler and machinery, transit and off-site storage. The
policy may contain separate sub limits and deductibles subject to insurance
company underwriting guidelines. Deductibles under the policy shall not exceed $100,000
per occurrence, except for deductibles for natural catastrophe peril, which
shall not exceed five percent (5%) of the insured loss


 


Increased cost of working
- the additional expenditure necessarily and reasonably incurred for the
purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Workers
Compensation


 


Coverage shall comply
with any statutory obligation imposed by Workers Compensation, Occupational
Disease Laws, or similar laws, including where applicable, the United States
Longshoremen’s and Harbor Workers’ Act, the Federal Employers’ Liability Act
and the Jones Act. Employers’ Liability insurance shall have limits of not less
than $1,000,000 per accident, $1,000,000 disease-policy limit and $1,000,000 disease-each
employee.


 


Commercial
General Liability


 


Insurance providing
coverage for bodily injury, property damage and personal/advertising injury
with a combined single limit of not less than $1,000,000 per occurrence and
$2,000,000 aggregate. The policy shall include contractual liability and any
testing operations coverage.


 


a.         Automobile Liability - Insurance for owned,
non-owned and hired automobiles with a limit of not less than $1,000,000 per
occurrence.


 


b.         Excess liability - Insurance with a minimum
limit of $10,000,000 per occurrence and annual aggregate.


 


c.          Evidence and Scope of Insurance


 


Purchaser shall provide Supplier with a copy of insurance original
certificates evidencing the insurance coverages required and shall provide
replacement certificates of insurance within five (5) days of any renewal
of the required insurance.


 


All
such insurance policies shall:


 


18

















 


(i)  name
Supplier for their respective rights and interests in respect of the Project as
additional insured (except in the case of worker’s compensation insurance);


 


(ii) provide Supplier with 30 days’ prior
written notice of non-renewal, cancellation of, or significant modification to,
any of such policies (except that such notice period will be 10 days in case of
non-payment of premiums); and


 


(iii) The insurance certificates provided to
Supplier shall indicate that the insurance policies have been endorsed as noted
above. All policies shall be written by one or more insurance companies
authorized to do business in USA and be rated BBB+ or higher by A.M. Best.


 


Term and Modification of Insurance


 


If
the designated coverage, or relatively comparable coverage, are unavailable on
reasonable commercial terms, Purchaser will provide Supplier detailed
information as to the maximum amount of available coverage that it is able to
purchase and will be required to obtain Supplier’s consent as to the adequacy
of said coverage under the circumstances at the time, which consent shall not
be unreasonably withheld or delayed.


 


ARTICLE 11


 


REPRESENTATIONS
AND WARRANTIES OF SUPPLIER


 


Supplier
hereby represents and warrants to Purchaser as follows:


 


11.1    Due Organization; Good
Standing. Supplier is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and qualified to conduct
business in the states where it does business.


 


11.2    Due Authorization.
The execution, delivery and performance of this Agreement by Supplier have been
duly authorized by all necessary corporate action on the part of Supplier and
do not and will not require the consent of any trustee or holder of any
indebtedness or other obligation of Supplier or any other Party to any other
agreement with Supplier.


 


11.3    Execution and Delivery.
This Agreement has been duly executed and delivered by Supplier. This Agreement
constitutes the legal, valid and binding obligation of Supplier, enforceable
against Supplier in accordance with its terms, except to the extent that its
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the rights of creditors generally or
by principles of equity.


 


11.4    Governmental Approvals.
No governmental authorization, approval, order, license, permit, franchise or
consent, and no registration, declaration or filing with any Governmental
Authority is required on the part of Supplier in connection with the execution,
delivery and performance of this Agreement, except those which have already
been obtained or which Supplier anticipates will be timely obtained in the
ordinary course of performance of this Agreement.


 


19

















 


11.5    Supply Items; Services.
The Supply Items and the SCADA System to be delivered hereunder shall be
designed and fit for the purpose of generating electric power when operated in
accordance with the Turbine Specifications, the OMS Manual, Prudent Electrical
Industry Practices and Prudent Wind Industry Practices. The Supply Items and
SCADA System shall be new and unused and shall be free from Defects and free
from defects in title. The Services shall be performed in a competent, diligent
manner in accordance with Prudent Wind Industry Practices, Supplier’s
manufacturers’ written requirements and applicable Governmental Requirements.


 


ARTICLE 12


 


REPRESENTATIONS
AND WARRANTIES OF PURCHASER


 


Purchaser
represents and warrants to Supplier as follows:


 


12.1    Due Organization; Good
Standing; Qualified To Do Business. Purchaser is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware, and qualified to conduct business in the states where it
does business.


 


12.2    Due Authorization.
The execution, delivery and performance of this Agreement by Purchaser have
been duly authorized by all necessary action on the part of Purchaser in
accordance with Purchaser’s organizational documents and do not and will not
require the consent of any trustee or holder of any indebtedness or other
obligation of Purchaser or any other Party to any other agreement with
Purchaser.


 


12.3    Execution and Delivery.
This Agreement has been duly executed and delivered by Purchaser. This
Agreement constitutes the legal, valid and binding obligation of Purchaser,
enforceable against Purchaser in accordance with its terms, except to the
extent that its enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the rights of
creditors generally or by principles of equity.


 


12.4    Governmental Approvals.
No governmental authorization, approval, order, license, permit, franchise or
consent, and no registration, declaration or filing with any Governmental
Authority is required on the part of Purchaser in connection with the
execution, delivery and performance of this Agreement, except those which have
already been obtained or which Purchaser anticipates will be timely obtained in
the ordinary course of performance of this Agreement.


 


12.5    Project Site. On or
prior to the date that Supplier is to provide any services relating to the
Project at the Project Site, Purchaser shall have obtained the right and
authority to have such work performed on the Project Site. To the knowledge of
Purchaser, after the completion of reasonable due diligence on the Project
Site, the Project Site is free of all hazardous or dangerous materials or
substances. All information concerning the Project Site and the wind flow
across the Project Site heretofore delivered to Supplier by Purchaser is true,
complete and correct in all material respects.


 


20

















 


ARTICLE 13


 


MUTUAL
INDEMNITY


 


13.1      Mutual Indemnity.
Each of Supplier and Purchaser agree to defend, indemnify and hold each other,
and each other’s lenders, parent companies, Affiliates, officers, directors,
agents and employees, harmless from and against any claims, losses, damages and
liabilities (including, but not limited to, reasonable attorneys’ fees and
court costs, but excluding consequential damages) on account of any claim by a
third Party for bodily injury or property damage against the indemnified Party
to the extent caused by the negligent act or omission, or willful misconduct
of, or breach of this Agreement by, the indemnifying Party or the indemnifying
Party’s employees, contractors, subcontractors or agents, in connection with
the performance of their respective obligations under this Agreement.


 


ARTICLE 14


 


DEFAULT;
CURE; REMEDIES


 


14.1    Default by Supplier.
Supplier shall be in default under this Agreement should any one or more of the
following events or conditions arise or exist:


 


(i)            Supplier becomes
insolvent, or generally does not pay its debts as they become due, or admits in
writing its inability to pay its debts, or makes a general assignment for the
benefit of creditors; or


 


(ii)           Insolvency,
receivership, reorganization, or bankruptcy proceedings are commenced by or
against Supplier and, in the case of any such involuntary proceeding, that is
not dismissed or stayed within sixty (60) days after it is commenced; or


 


(iii)          Supplier fails, for
any reason, other than failure of Purchaser to make payments to Supplier when
obligated in accordance with this Agreement, to make any undisputed payments
required to be made by Supplier to Purchaser, which failure continues for ten (10) Business
Days after notice of such non-payment; or


 


(iv)          Supplier is in
material default of any term or provision of this Agreement or has materially
failed to perform its obligations under this Agreement, and such breach or failure
continues for thirty (30) Business Days following receipt of written notice
from Purchaser to cure such breach or failure; provided, however, if such
failure cannot with due diligence be remedied by Supplier within such thirty
(30) Business Days period, and Supplier shall have diligently prosecuted the
remedying of such failure within such thirty (30) Business Days, such period
shall be extended by such additional time period as may be reasonably required
by Supplier to cure such failure.


 


14.2    Purchaser’s Remedies.
In the event Supplier is in default pursuant to Section 14.1, and
said default is not timely cured within the time periods set forth above,
Purchaser, in addition to those rights and remedies that may be available to
Purchaser at law or in equity, and subject to Section 9.2 of this
Agreement, shall have the right to terminate this Agreement by written notice
to Supplier; provided however, that amounts applicable to Supply Items
delivered or services


 


21

















 


performed by Supplier
through the date of termination of this Agreement shall be paid by Purchaser to
Supplier.


 


14.3    Default by Purchaser. Purchaser shall
be in default under this Agreement should any one or more of the following
events or conditions arise or exist:


 


(i)            Purchaser or Guarantor becomes
insolvent, or generally does not pay its debts as they become due, or admits in
writing its inability to pay its debts, or makes a general assignment for the
benefit of creditors; or


 


(ii)           Insolvency, receivership,
reorganization or bankruptcy proceedings are commenced by or against Purchaser
or Guarantor and, in the case of any such involuntary proceeding, that is not
dismissed or stayed within sixty (60) days after it is commenced; or


 


(iii)          Purchaser fails to timely pay to
Supplier any required payment under this Agreement when due, including failure
to timely provide any Down Payment or any Progress Payment, which failure
continues for ten (10) days after written notice of failure to make payment
has been received by Purchaser from Supplier; or


 


(iv)          Purchaser fails to perform any
material term or provision of this Agreement, including failure to timely
provide the Guaranty to Supplier, and such failure continues for thirty (30)
Business Days following receipt of written notice from Supplier to cure such
failure; provided, however, if such failure cannot with due diligence be
remedied by Purchaser within such thirty (30) Business Day period, and
Purchaser shall have diligently prosecuted the remedying of such failure within
such thirty (30) Business Days, such period shall be extended by such
additional time period as may be reasonably required by Purchaser to cure such
failure; or


 


(v)           The revocation or other termination
of the Guaranty by Guarantor, or the breach by Guarantor of any material term
or provision of the Guaranty, including any payment obligation thereunder,
which breach continues for a period of ten (10) days after written notice
of such breach has been received by Guarantor from Supplier.


 


14.4    Supplier’s Remedies. In the event
that Purchaser is in default pursuant to Section 14.3, and said
default is not timely cured within the time periods set forth above, Supplier,
in lieu of any rights and remedies that may be available to Supplier at law or
in equity, shall have the right to terminate this Agreement by written notice
to Purchaser, which termination shall be effective upon delivery of Supplier’s
notice to Purchaser. Within
three (3) Business Days of the effective date of such termination, Purchaser
shall pay to Supplier the liquidated damages set forth on the termination
schedule attached hereto as Exhibit G (“Termination Schedule”), which shall
constitute Supplier’s exclusive remedy, and Supplier shall have no right to
damages or compensation for such termination other than payment of the liquidated
damages set forth on the Termination Schedule.


 


14.5    Cancellation Due to a Force Majeure Event.
If Supplier is entirely prevented from performing its obligations hereunder for
a period of one-hundred eighty (180) consecutive days as a result of the
occurrence of a Force Majeure Event suffered by Supplier, then Supplier may
cancel, without additional liability, any then remaining unperformed portion of
this Agreement, upon


 


22

















 


not less than thirty (30)
Business Days’ prior written notice to the Purchaser; provided, however, that
nothing in this Section 14.5 shall relieve or excuse Supplier from
its obligations under Article 7 of this Agreement in respect of the
occurrence of a Force Majeure Event or relieve either Party from any payment
obligation that has accrued as of the date of cancellation or prior thereto;
provided further, however, that any payment obligations of Purchaser shall be
reduced by the amount of funds received by Supplier, if any, in connection with
the resale of any Turbines or Turbine components sold that are applicable to
such payment obligations of Purchaser, and, if following such reduction,
Purchaser is owed a refund of some portion of the Purchase Price from Supplier,
Supplier shall refund to Purchaser the applicable amount of Purchase Price
previously paid to Supplier within thirty (30) days of such termination.


 


14.6    Termination for Convenience. The Purchaser shall have the right to terminate this Agreement for convenience with respect to any Turbine
until title to such Turbine has passed to Purchaser. Such termination
shall be effective upon the later to occur of (i) delivery to Supplier of
written notice of termination and (ii) receipt by Supplier of liquidated damages in the amount on a per Turbine
basis with respect to such Turbine in accordance with the Termination Schedule attached to this
Agreement as Exhibit G.


 


14.7    Surviving Obligations. Cancellation
or expiration of all or any portion of this Agreement (a) shall not
relieve Purchaser of its obligations with respect to the confidentiality of
Supplier’s proprietary information as set forth in Section 4.5 of
this Agreement, or either Party of its confidentiality obligations as set forth
in Section 16.9 of this Agreement, (b) shall not relieve
either Party of any obligation hereunder which expressly or by implication
survives termination hereof, and (c) except as otherwise provided in any
provision of this Agreement expressly limiting the liability of either Party,
shall not relieve either Purchaser or Supplier of any obligations or
liabilities for loss or damage to the other Party arising out of or caused by
acts or omissions of such Party prior to the effectiveness of such termination
or arising out of such termination, and shall not relieve Supplier of its
obligations as to portions of the items supplied or other services hereunder
already supplied or performed or of obligations assumed by Supplier prior to
the date of termination. This Article shall survive the termination or
expiration of this Agreement.


 


ARTICLE 15


 


DISPUTE RESOLUTION


 


15.1    Procedure. In the event a dispute,
controversy or claim (herein, a “dispute”) arises between Purchaser and
Supplier relating to this Agreement, the aggrieved Party shall promptly provide
written notification of the dispute to the other Party within ten (10) days
after such dispute arises and the Parties shall resolve such dispute as
provided herein:


 


15.1.1       Executives Meeting. A meeting
shall be held between the Parties, attended by representatives of the Parties
with decision-making authority regarding the dispute, to attempt in good faith
to negotiate a resolution of the dispute. Such meeting shall be held in
Carpinteria, California within thirty (30) days after a notice of dispute has
been delivered under Section 15.1 above.


 


23

















 


15.1.2       Independent Engineer’s Decision.
If the dispute involves a technical issue, within ten (10) days after such
meeting, the Parties have not resolved the dispute, either Party shall submit
the dispute to the Independent Engineer for a non-binding determination,
together with such information in support of their position as may be relevant,
which information will simultaneously be sent to the other Party. The
Independent Engineer may hold separate meetings with each Party or call a joint
meeting of the Parties, to be held in Carpinteria, California. The Independent
Engineer shall, within thirty (30) days after such request for a determination,
issue a non-binding decision. Any Party which does not wish to comply with such
decision shall promptly provide written notification of its intention to the
other Party within five (5) days of such decision. The Parties shall meet
in Chicago, Illinois within twenty (20) days of such notice to attempt, in good
faith, to negotiate a final resolution to the dispute. Any Party which does not
wish to comply with such decision shall within ten (10) days after the
date of such meeting submit the dispute to arbitration within twenty (20) days
after the date of such decision to arbitration in accordance with Section 15.1.3
below. The Parties shall share equally the costs of the Independent Engineer.


 


15.1.3       Arbitration.


 


(a)           If the Parties are not successful in
resolving a dispute, controversy or claim pursuant to Sections 15.1.1
and 15.1.2, above, then such dispute shall be resolved through binding
arbitration to take place in Chicago, Illinois. The Parties agree to conduct all
arbitration proceedings in accordance with the Commercial Arbitration Rules of
the American Arbitration Association. This Section 15.1.3 is
governed by the Federal Arbitration Act.


 


(b)           A Party desiring to submit to
arbitration any such dispute, controversy or claim shall furnish its demand for
arbitration in writing to the other Party or Parties thereto, which demand
shall contain a brief statement of the matter in controversy, as well as a list
containing the names of three (3) suggested arbitrators from the list of
arbitrators maintained by the American Arbitration Association (the “AAA List”)
from which list, or from other sources, all of the Parties shall choose one (1) mutually
acceptable arbitrator. If the Parties are unable to agree upon the identity of
a single arbitrator, within ten (10) days from the receipt of such demand,
the Purchaser and the Supplier shall each (collectively, the “Arbitrating
Parties”), within a period of five (5) additional days, name from the
AAA List one (1) arbitrator by written notice to the other Arbitrating Party or
Parties. Within ten (10) days after this notice, the two (2) arbitrators
so named shall choose a third arbitrator. If any Arbitrating Party fails to
name an arbitrator within the specified five (5) day period or if the two
arbitrators chosen by the Arbitrating Parties fail to select a third arbitrator
within the ten (10) day period, then either Arbitrating Party, on behalf of and
on notice to the other Arbitrating Party or Parties, may request appointment by
the American Arbitration Association in accordance with its rules then
prevailing of the required additional arbitrator or arbitrators so that there
shall be a panel of three (3) arbitrators. If the American Arbitration
Association should fail to appoint the necessary arbitrator or arbitrators
within fifteen (15) days after such request is made, then either Arbitrating
Party may apply, on notice to the other Arbitrating Party or Parties, to a
court of competent jurisdiction for the appointment of such necessary
additional arbitrators. Each of the arbitrator or arbitrators chosen or
appointed pursuant to


 


24

















 


this Section 15.1.3(b) shall
be a person having at least ten (10) years experience in the United States
in the legal profession and shall not be a past or present officer, director or
employee of, or have any material interest in, any Arbitrating Party or any
Affiliate of an Arbitrating Party. All discovery, including the right to take
depositions and interrogatories, shall be permitted in the time and manner
provided by the then applicable Federal Rules of Civil Procedure. The
Arbitrating Parties shall be entitled to reasonable discovery prior to the
arbitration hearing, and the arbitrator or arbitrators, as the case may be,
shall have the power upon application of any Arbitrating Party to make all
appropriate orders for discovery from the other Arbitrating Party, including
discovery of documents, responses to interrogatories, and depositions. The
scope, time and manner of discovery, including all document discovery, are to
be in accordance with the U.S. Federal Rules of Civil Procedure.
Notwithstanding the foregoing, discovery allowed each of the Arbitrating
Parties shall not exceed: (i) five (5) party depositions; (ii) three (3) nonparty
depositions; (iii) three (3) depositions of any experts selected to
give opinions in the arbitration (as well as the production of any documents
relied upon by such experts); and (iv) fifteen (15) interrogatories (with
each subpart counted as a separate interrogatory). Discovery shall not include
requests for admissions. No deposition shall last more than two (2) days
in length. Further, all discovery must, without exception, be completed within
one hundred twenty (120) days from the date the arbitration panel is appointed.
Any documents that are not produced to the other Arbitrating Party prior to the
termination of this 120-day discovery period may not be offered into evidence
at the arbitration hearing unless such production shall not prejudice the
non-producing Arbitrating Party as determined by the arbitrator or arbitrators,
as the case may be. Likewise, any witnesses who have not been produced for
deposition, despite a request from the other side, may not testify or submit
affidavits at the arbitration hearing.


 


(c)           The arbitrator or arbitrators, as the
case may be, shall render his, her or their decision, in the latter case upon
the concurrence of at least two (2) of their number, as soon as possible
but no later than thirty (30) days after the conclusion of any hearings before
such arbitrator or arbitrators, as the case may be, unless such 30-day period
is extended by the arbitrator or arbitrators, as the case may be. The decision
and award shall in either case be in writing and counterpart copies of such
decision shall be delivered to each of the Arbitrating Parties. Such decision
shall be based solely upon the written arguments and contentions, evidence and
legal authorities, submitted by each Arbitrating Party. In rendering such
decision and award, the arbitrator shall not add to, subtract from or otherwise
modify the provisions of this Agreement. Any award rendered shall be final and
conclusive upon the parties and a judgment on any such award may be entered in
any court having jurisdiction, state or federal, having jurisdiction. No
arbitration proceeding shall be commenced after the date when institution of
legal or equitable proceedings based upon such subject matter would be barred
by the applicable statute of limitations. Notwithstanding anything to the
contrary contained in this section or elsewhere in this Agreement, provisional
injunctive or other provisional equitable relief may be sought by the parties
without first submitting the subject dispute to arbitration so long as
injunctive relief is otherwise warranted by applicable law.


 


25














 


15.2    Qualifications of Arbitrators; Expenses.


 


(a)           The arbitrators in the arbitration
proceeding provided for in this Article 15 shall be individuals
experienced in the energy construction industry and competent to pass on the
matter presented for arbitration.


 


(b)           Supplier, on the one hand, and
Purchaser, on the other, shall share equally the compensation and expenses of
the arbitrators as well as all fees imposed by the AAA. Supplier and Purchaser
shall be responsible for their own costs and legal fees, if any.
Notwithstanding the foregoing, a majority of the arbitrators shall be empowered
to award the prevailing Party its costs, expenses and/or legal fees.


 


15.3    Performance During Dispute. While any
controversy, dispute or claim arising out of or relating to this Agreement is
pending, Purchaser and Supplier shall continue to perform their obligations
hereunder notwithstanding such controversy, dispute or claim.


 


15.4    Consolidation. No arbitration arising
under this Agreement shall include, by consolidation, joinder or any other
manner, any person or entity not a Party to this Agreement, unless (a) such
person or entity is substantially involved in a common question of fact or law,
(b) the presence of such person or entity is required if complete relief
is to be accorded in the arbitration, and (c) such person or entity has
consented to such inclusion.


 


15.5    Language. All arbitration proceedings
shall be conducted in the English language.


 


ARTICLE 16


 


GENERAL PROVISIONS


 


16.1    Waiver. No delay or omission by the
Parties hereto in exercising any right or remedy provided for herein shall
constitute a waiver of such right or remedy nor shall it be construed as a bar
to or waiver of any such right or remedy on any future occasion.


 


16.2    Successors and Assigns. This
Agreement shall be binding upon and shall inure to the benefit of the
successors and permitted assigns of Supplier and Purchaser. Except as set forth
herein, neither Supplier nor Purchaser may assign, convey or transfer this
Agreement, in whole or in part, except upon the prior written consent of the
other Party hereto, which consent shall not be unreasonably withheld, and any
such purported transfer or assignment shall be null and void. Notwithstanding
any permitted assignment hereunder, the assignor shall remain liable to the
other Party for all duties and responsibilities hereunder unless affirmatively
recited by the other Party.


 


16.3    Permitted Assignments.
Notwithstanding Section 16.2 above, (i) either Party may
transfer or assign its rights, benefits and obligations under this Agreement to
an Affiliate; provided, that if requested by Purchaser, Supplier shall execute
and deliver a guaranty of the performance hereunder by such an assignee, (ii) Purchaser
may assign its rights, benefits and obligations under this Agreement to any
purchaser of the Project; provided, that Purchaser may not transfer or assign
this Agreement in whole or in part to a wind turbine design or manufacturing
competitor of Supplier without the prior written consent of Supplier, which
consent may be withheld in Supplier’s sole discretion and which may be
conditioned upon the creditworthiness of the purchaser, (iii) Supplier is


 


26

















 


authorized to subcontract
any portion of its duties under this Agreement to a third party or to delegate
its obligations hereunder, in the ordinary course of its business, without
reducing the scope of Supplier’s undertakings, obligations, and commitments to
Purchaser, provided that Supplier agrees that it will not use any supplier for
any Major Turbine Components not listed on Exhibit H without
Purchaser’s advance written consent, such consent not to be unreasonably
withheld, conditioned or delayed, and (iv) a Party, without the consent of
the other Party, may assign its interest in this Agreement to a lender,
collateral trustee, security trustee or similar entity as collateral security
for any financing entered into by the assigning Party, including a lease
financing. The non-assigning Party shall, upon fifteen (15) days’ prior written
request from the assigning Party, execute a consent containing customary terms
and conditions, to any such collateral assignment. Further, notwithstanding Section 16.2
above, Purchaser shall have the right to assign no less than all of its rights,
duties and obligations under the Turbine Supply Documents to any third party,
subject to, and conditioned upon, the prior written consent of Supplier, which
shall not be unreasonably withheld, conditioned, or delayed; provided however
that any such assignment is conditioned upon the receipt of a guarantee for the
benefit of Supplier of the performance of the contract obligations, including
payment security, in a form acceptable to Supplier, in its sole and absolute
discretion. Any such assignment to a third party also shall be subject to the
following: (i) prior to the effectiveness of such assignment, the third
party assignee shall agree to revisions to the Turbine Supply Documents as
determined by Supplier to be reasonably necessary, to effect the purchase and
installation of the Turbines by the third party assignee at a project site to
be determined between Supplier and any such third party assignee, (ii) the
third party assignee shall assume all of the duties, obligations, restrictions
and covenants of Purchaser under the Turbine Supply Documents, as revised, (iii) any
monies or other consideration received by, or otherwise payable to, Purchaser
from the third party assignee in connection with such assignment, in excess of
the Down Payment and any Progress Payments actually paid by Purchaser to
Supplier, other than the reasonable actual documented expenses incurred by
Purchaser in connection with the assignment of the Turbine Supply Documents to
the third party, shall be paid to Supplier and (iv) Purchaser shall pay to
Supplier all of Supplier’s costs associated with such assignment from Purchaser
to the third party assignee, including but not limited to all of Supplier’s
costs (including reasonable legal fees) incurred in connection with the
revision of the Turbine Supply Documents, within thirty (30) days of receipt of
an applicable invoice from Supplier.


 


16.4    Notices.


 


(a)          Any notice required or authorized to
be given hereunder or any other communications between the Parties provided for
under the terms of this Agreement shall be in writing (unless otherwise
provided) and shall be served personally or by reputable express courier
service or by facsimile transmission addressed to the relevant Party at the
address stated below or at any other address notified by that Party to the
other as its address for service. Any notice so given personally shall be
deemed to have been served on delivery, any notice so given by express courier
service shall be deemed to have been served two (2) Business Days after
the same shall have been delivered to the relevant courier, and any notice so
given by facsimile transmission shall be deemed to have been served on
dispatch. As proof of such service it shall be sufficient to produce a receipt
showing personal service, the receipt of a reputable courier company showing
the correct address of the addressee or an activity report of the sender’s
facsimile


 


27

















 


machine
showing the correct
facsimile number of the Party on whom notice is served and the correct number
of pages transmitted.


 


(b)          The Parties’ addresses for service are:


 


	
   

  	
  To Purchaser:

  	
   

  	
  UPC Wind Acquisition V,
  LLC

  
	
   

  	
   

  	
   

  	
  c/o UPC Wind
  Management, LLC

  
	
   

  	
   

  	
   

  	
  85 Wells Ave.,
  Suite 305

  
	
   

  	
   

  	
   

  	
  Newton, MA 02459

  
	
   

  	
  Attn:

  	
   

  	
  General Counsel

  
	
   

  	
   

  	
   

  	
  Facsimile:

  	
  (617) 964-3342

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  (617) 964 3340

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  To Supplier:

  	
   

  	
  Clipper Turbine
  Works, Inc.

  
	
   

  	
   

  	
   

  	
  6305 Carpinteria
  Avenue, Suite 300

  
	
   

  	
   

  	
   

  	
  Carpinteria, California
  93013

  
	
   

  	
   

  	
   

  	
  Attn:

  	
  General Counsel

  
	
   

  	
   

  	
   

  	
  Facsimile:

  	
  805.899.1115

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
  805.690.3275

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
   

  	
  Chadbourne &
  Parke LLP

  
	
   

  	
   

  	
   

  	
  350 South Grand Avenue,
  Suite 3300

  
	
   

  	
   

  	
   

  	
  Los Angeles, CA 90071

  
	
   

  	
   

  	
   

  	
  Attn:

  	
  Edward W. Zaelke

  
	
   

  	
   

  	
   

  	
  Facsimile: 

  	
  213.622.9865

  
	
   

  	
   

  	
   

  	
  Telephone: 

  	
  213.892.1000

  



 


16.5    Governing Law. This
Agreement and all matters arising hereunder or in connection herewith shall be
governed by and construed in accordance with the laws of the State of New York,
without regard to conflicts of law principles.


 


16.6    Amendments. This
Agreement may be modified or amended only by an instrument in writing signed by
the Parties hereto.


 


16.7    Attachments Incorporated.
The preamble and recitals of this Agreement, and the Exhibits attached hereto,
are hereby incorporated into and made a part of this Agreement.


 


16.8    Entire Agreement.
The terms and conditions set forth herein, together with those set forth on all
Exhibits attached hereto, constitute the complete statement of the agreement
between Supplier and Purchaser relating to the subject matter hereof. No prior
statement or correspondence shall modify or affect the terms and conditions
hereof. Prior representations, promises, warranties or statements by Supplier
or Purchaser, or by any agent or employee of Supplier or Purchaser, that differ
in any way from the terms and conditions hereof shall be given no effect.


 


16.9    Confidentiality.
Each Party agrees to keep the terms and provisions of this Agreement and all
materials and information that each receives pursuant hereto or in connection
herewith or in connection with the Project in the strictest confidence and not
to disclose any of the foregoing to any party other than the respective
lenders, investors, attorneys, accountants, Affiliates,


 


28

















 


officers
and directors of each Party or as such Party may be required by law, court
order or in any litigation to disclose. This Section 16.9 shall
survive the termination of this Agreement. Notwithstanding the foregoing,
Supplier shall be entitled to announce by press release or other means that it
has agreed to furnish the Turbines for the Project. The Parties agree that,
with respect to press releases concerning the Project, they will endeavor to
cooperate and share information with one another so that the Parties are
identified, to the extent practicable in press releases regarding the Project.
Supplier and Purchaser will each provide copies of all press releases issued
regarding the Project to the other. Furthermore, the restrictions of this Section 16.9
shall not prohibit or restrict Supplier from using or disclosing the
availability and performance data from the Project in connection with its
sales, maintenance and other internal purposes; provided, however, that no
specific reference shall be made to the Project in connection with the
disclosure of such data.


 


16.10 Counterparts. This
Agreement may be executed by the Parties in one or more counterparts, all of
which taken together, shall constitute one and the same instrument. The
exchange of copies of this Agreement and of signature pages by facsimile
transmission shall constitute effective execution and delivery of this
Agreement as to the Parties and may be used in lieu of the original Agreement
for all purposes (and such signatures of the parties transmitted by facsimile
shall be deemed to be their original signatures for all purposes).


 


16.11 English Language Documents.
Any document, manual, certificate or notice required or authorized to be given
hereunder for the operation of the Project shall be provided in the English
language.


 


16.12 Severability. In case
any provision in this Agreement is held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not be affected.


 


16.13 Headings. The headings
and captions used in this Agreement are inserted for reference and convenience
only and the same shall not limit or construe the sections, articles or
paragraphs to which they apply or otherwise affect the interpretation thereof.


 


16.14 Agreement Revisions.
Following the execution of this Agreement by the Parties, if either Party
requests a change to the Agreement in order to (i) correct any
inconsistency contained within the Agreement or among the Turbine Supply
Documents or (ii) clarify any ambiguities in the Agreement to reflect the
intent of the Parties, then the Parties agree to work in good faith to amend
the language of the Agreement to conform to any such requested change.


 


29

















 


IN WITNESS WHEREOF, this Agreement has been executed and delivered by
the duly authorized representatives of Purchaser and Supplier as of the date
first written above.


 


 


	
   

  	
   

  	
  CLIPPER
  TURBINE WORKS, INC.,

  
	
   

  	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  UPC
  WIND ACQUISITION V, LLC, 

  a Delaware limited liability company

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Paul Gaynor

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Paul
  Gaynor

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President

  



 


[Signature Page to Turbine 

Supply Agreement]


 

















 


IN WITNESS WHEREOF, this Agreement has been executed and delivered by
the duly authorized representatives of Purchaser and Supplier as of the date
first written above.


 


	
   

  	
   

  	
  CLIPPER
  TURBINE WORKS, INC.,

  
	
   

  	
   

  	
  a
  Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Robert Gates

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Robert
  Gates

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Sr.
  Vice Pres

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  UPC
  WIND ACQUISITION V, LLC, 

  a Delaware limited liability company

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  



 


[Signature Page to Turbine 

Supply Agreement]


 

















 


APPENDIX I


 


DEFINITIONS


 


“Additional Cost Event” means (a) an Emergency, (b) a Force
Majeure Event or an Operating Force Majeure Event, (c) damage caused by an
act or omission of the Owner or a third party (other than an Affiliate,
Subcontractor or other agents or designees of the Operator) which is required
to be repaired in order for the Turbines to be operated and maintained in
accordance with the standard set forth in this Agreement, or (d) the
receipt by the Operator of a written request from the Owner for the Operator’s
performance of Additional OMS Services.


 


“Affiliate” means, with respect to any Party, any Person or entity
which, directly or indirectly, is in control of, or is controlled by, or is
under common control with such Party or any Subsidiary of such Party. For the
purposes of this definition, control of a Party shall mean the power, direct or
indirect, (a) to vote in excess of fifty percent (50%) or more of the
securities having ordinary voting power for the election of directors, (b) to
direct or cause the direction of the management and policies of such Party,
whether by contract or otherwise.


 


“After Tax Value” means an amount equal to the sum of any payment,
credit or other original amount (the “Original Amount”) plus an amount that
will cause the recipient to retain a sum equal to the Original Amount after
federal income taxes at the highest marginal rate are or would be imposed on
the After Tax Value.


 


“Agreement” means the Supply Agreement, the Warranty Agreement or the
OMS Agreement, as the context requires.


 


“Ancillary Parts and Equipment” means those ancillary parts, materials
and equipment listed in Exhibit A to the Supply Agreement, which
are typically required, together with the Major Turbine Components, to form a
Turbine.


 


“Annual Windsystem Availability” or “AWA” has the meaning given in Exhibit A
to the Warranty Agreement.


 


“Availability” has the meaning given in Exhibit A to the
Warranty Agreement.


 


“Available Hours” has the meaning given in Exhibit A to the
Warranty Agreement.


 


“Average Nominal Measured Energy” or “ANME” has the meaning given in Exhibit C
to the Warranty Agreement.


 


“AWA Period Revenue” shall have the meaning given in Exhibit A
to the Warranty Agreement.


 


“Base Hours” has the meaning given in Exhibit A to the
Warranty Agreement.


 


“Business Days” means Monday through Friday of each week, except
holidays in which commercial banks in the United States are required or
permitted to close.


 


I-1

















 


“Change in Law” means, after the date hereof, the enactment,
modification or repeal or any Governmental Requirements, or any change in the
interpretation of any Governmental Requirements by any Governmental Authority
or court of law, that materially affects Supplier’s schedule for performing any
of its obligations hereunder; provided a change in applicable tax law shall not
constitute a “Change in Law” hereunder.


 


“Commencement Date” means the date upon which the Supplier shall have
timely received the entirety of (a) the Down Payment, (b) the Parent
Guaranty, and such other fees as may be applicable.


 


“Commissioning” or “Commissioning Work” means the installation
inspection, field commissioning and acceptance testing, and controller power-up
test, and start-up work to be conducted by Supplier under the Supply Agreement,
for each Turbine, in accordance with the Commissioning and Start-Up Procedures.


 


“Commissioning and Start-Up Procedures” means the field commissioning
and acceptable testing and start-up test and inspection procedures set forth on
Exhibit O of the Supply Agreement.


 


“Commissioning Certificate” means a certificate issued by Supplier to
Purchaser, in the form attached as Exhibit M to the Supply
Agreement, following completion of Commissioning of each Turbine.


 


“Complete” or “Completion” shall mean, with respect to any Turbine, that
(i) all Turbine Components have been delivered to the Project Site and
installed in accordance with the Installation Procedures, (ii) Purchaser
has completed the necessary terminations and connections of the collection
lines and the SCADA communication lines into the controller in the base of the
Turbine Tower using the collection lines and SCADA communication lines supplied
by Purchaser, and (iii) the Turbine has been Commissioned.


 


“Completion Schedule” shall mean the schedule for the completion by
Supplier and Purchaser, as applicable, of Turbine installation and
Commissioning as set forth in Exhibit T to the Supply Agreement.


 


“CPI” shall mean the Consumer Price Index for the United States City
Average, All Urban Consumers (CPI-U), All Items (base index year
1982-1984=100), as published by the United States Department of Labor, Bureau
of Labor Statistics.


 


“Default Rate” means a per annum rate of interest equal to the lesser of
(a) the maximum rate permitted by law and (b) twelve percent (12%) per
annum.


 


“Defect” means a defect in any part or component of a Turbine covered
under the Standard Warranty that causes such part or component to fail during
the Warranty Period. A component is deemed to have “failed” only when it either
(i) breaks, or (ii) ceases to perform the operation for which it was
designed, intended or installed; provided, however, that normal wear and tear
shall not constitute failure.


 


I-2

















 


“Delivery” or “Delivered” means when a Supply Item is made available by
Supplier for pickup by Purchaser at its respective Designated Delivery
Location, provided however, that Purchaser may not take custody and control of
the said Supply Item until the applicable Progress Payment has been made by
Purchaser and received by Supplier.


 


“Delivery Schedule” shall mean the schedule as set forth in Exhibit L
to the Supply Agreement for the Delivery by Supplier of the Supply Items to the
Designated Delivery Locations.


 


“Designated Delivery Location” shall have the meaning given in Section 5.4
of the Supply Agreement.


 


“Down Payment” shall have the meaning given in Section 3.1
of the Supply Agreement.


 


“Down Payment Date” shall have the meaning given in Section 3.1
of the Supply Agreement.


 


“Effective Date” shall mean the date of the Supply Agreement.


 


“Electrical Infrastructure” means the pad mounted transformers, feeder
lines, high voltage feeder lines, switches and all other related facilities
owned by Purchaser through which the electrical power generated by the Turbine
is transferred from the point of connection at the Turbine Controller to the
Interconnection Facilities.


 


“Emergency” means an event occurring at the Project Site, or the
Maintenance and Spare Parts Facility or any adjoining property that poses
actual or imminent risk of serious personal injury or material physical damage
to the Project, or parts thereof, requiring immediate preventative or remedial
action.


 


“Environmental Laws” means all laws, rules, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, preservation or reclamation of natural
resources, the management, environmental release or threatened environmental
release of any Hazardous Substance or to health and safety matters, including
the Comprehensive Environmental Response, Compensation, and Liability Act of
1980, 42 U.S.C. §§ 9601 et seq.; the Resource Conservation and Recovery Act, as
the same may be amended from time to time, 42 U.S.C. §§ 6901 et seq.; the
Federal Water Pollution Control Act, 33 U.S.C. §§ 1251 et seq.; the Toxic
Substances Control Act, 15 U.S.C. §§ 2601 et seq.; the Clean Air Act, 42 U.S.C.
§§ 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. §§ 3803 et seq.; the
Oil Pollution Act of 1990, 33 U.S.C. §§ 2701 et seq.; the Emergency Planning
and the Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the
Hazardous Material Transportation Act, 49 U.S.C. §§ 1801 et seq. and the
Occupational Safety and Health Act, 29 U.S.C. §§ 651 et seq.; and any state and
local counterparts or equivalents, in each case as amended from time to time.


 


“EPC Contract” means that certain agreement(s), if any, by and between
Purchaser and EPC Contractor(s), for the erection of the Turbine and the
design, supply, construction, installation and commissioning of (i) crane
pads, laydown areas, temporary construction roads


 


I-3

















 


and storage yards, (ii) permanent
roads, Turbine foundations and transformer foundations, (iii) the
Electrical Infrastructure, (iv) the SCADA System, including communication
lines, (v) any control and operation and maintenance buildings and
facilities (vi) and other civil and electrical elements and other work for
the Project.


 


“EPC Contractor(s)”
means such person or entity selected by Purchaser as principal contractor for
performing work under the EPC Contract.


 


“Escrow Agent”
means such party as agreed upon by Supplier and Purchaser to serve as the escrow
agent.


 


“FAA” means the
Federal Aviation Administration.


 


“Final Assembly
Work” shall mean the final assembly work for the completion of Turbine
component assembly, as set forth in Exhibit P to the Supply
Agreement, prior to the installation of the Turbine.


 


“Financing
Documents” means the financing agreement, by and among the Purchaser or one of
its Affiliates, and the lenders or other financial institutions from time to
time party thereto by which the Purchaser or one of its Affiliates intends to
raise capital to finance the construction of the Project.


 


“Force Majeure
Event” means any event beyond the reasonable control of the Party affected
which materially affects its performance hereunder, including, without
limitation: war, hostilities, insurrection, riot, vandalism or other public
disorder or civil disturbance; terrorism; perils at sea, acts of God, fire,
hurricanes, tornadoes (including tornado watches or warnings for the Project
Site issued by the National Weather Service), mudslides, hail, earthquakes,
lightning, other extreme weather conditions, and, during Commissioning or
repairs, wind in excess of fifteen (15) meters per second or that would make
necessary lifting unsafe, but only for so long as such winds persist;
expropriation or confiscation; strikes, lockouts or other labor disputes;
perils at sea; or unforeseen delays in transportation or shipping, including
with respect to roadways, harbors, ports and other transportation and shipping
infrastructure; any Change in Law; or damage to any part of Supplier’s
factories or assembly plants, or the factories or assembly plants of its
Subcontractors. Force Majeure Events shall include those Force Majeure Events
experienced by any of Supplier’s Subcontractors in circumstances where Supplier
is not able to reasonably reallocate the work of that Subcontractor to an
alternative vendor.


 


“Germanischer
Lloyd” means Germanischer Lloyd Windenergie GMBH.


 


“Germanischer
Lloyd Turbine Certification”, “GL Certificate” or “GL Certified” means a
certification of the Turbine to be issued by Germanischer Lloyd.


 


“Governmental
Authority” means the government or any federal, state, municipal or other
political subdivision in which the Project is located, or any other
governmental or political subdivision thereof exercising jurisdiction over the
Project or, with respect to their rights and obligations hereunder or, with
respect to the Project, the Parties, including all agencies and
instrumentalities of such governments and political subdivisions.


 


I-4














 


“Governmental
Requirements” means all laws, statutes, codes, rules, regulations, orders, and
decrees of any Governmental Authority in effect on the date hereof, including
all authorizations, consents, registrations, exemptions, Permits and licenses
with or from any Governmental Authority, applicable to the Project or, with
respect to their rights and obligations hereunder or with respect to the
Project, the Parties.


 


“Guarantor” means
UPC Wind Partners, LLC as guarantor under that certain Guaranty to be entered
into between Supplier and UPC Wind Partners, LLC.


 


“Hazardous
Substances” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum
or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all
other substances or wastes of any nature regulated pursuant to any
Environmental Law.


 


“Independent
Engineer” means Garrad Hassan, Germanischer Lloyd, the National Renewable
Energy Laboratory, or Global Energy Concepts, or such other independent
engineer as mutually agreed.


 


“Installation
Procedures” means the procedures for the proper (i) assembly, erection and
installation of the Towers on the Turbine foundations supplied by Purchaser, (ii) grouting
of the Turbines to the Tower foundations and tightening of all bolts using the
appropriate torque; (iii) assembly, erection and installation of the
Turbine Nacelles and Turbine Blades upon the Towers as specified in the Turbine
Specifications, Prudent Wind Industry Practices and Prudent Electrical Industry
Practices; (iv) installation and testing of the Turbine electrical cables,
communication cables, and control panels within the Turbine, and (v) connection
of the cables from each Turbine Nacelle to the main circuit breaker within the
ground controllers, all in accordance with the Turbine Installation Manual.


 


“Installation Work”
means the work required pursuant to the Installation Procedures to assemble,
erect and install the Turbines.


 


“Intellectual
Property Rights” means and refers to all patents, copyrights, trademarks,
service marks, trade secrets and all similar and related intellectual property
rights protected under any statutes, laws, codes, rules or regulations and
any licenses and other rights obtained by Supplier or its Affiliates from third
parties.


 


“Interconnection
Facilities” means all the land rights, materials, equipment and facilities to
be installed by Purchaser for the purpose of interconnecting the Turbines to
the Project’s substation so as to permit the delivery of electrical energy
generated by the Turbines to the interconnection point within the Project’s
substation, which shall include, but shall not be limited to, electrical interconnection,
switching, metering, relaying, communication and safety equipment.


 


“Lenders” shall
mean those lenders providing financing for the Project.


 


“Maintenance and
Spare Parts Facility” means the location from which Operator will perform the
OMS Services.


 


I-5

















 


“Major Turbine
Components” means the Turbine Nacelle, Turbine Controller, Turbine hub, Turbine
Blades and Tower for each Turbine, as such items are more particularly
described in the Turbine Specifications.


 


“Nominal Expected
Energy” or “NEE” has the meaning given in Exhibit C of the Warranty
Agreement.


 


“Nominal Measured
Energy” or “NME” has the meaning given in Exhibit C of the Warranty
Agreement.


 


“OMS Agreement”
means that certain Operation and Maintenance Service Agreement, executed or to
be executed between Supplier (or an Affiliate of Supplier) and Purchaser (or an
Affiliate of Purchaser) of even date herewith, pursuant to which Supplier (or
an Affiliate of Supplier) will operate, maintain and service the Turbines.


 


“OMS Manual” means
the detailed operations, and maintenance service manual for the Turbines
supplied to Purchaser by Supplier, together with any future updates and
supplements thereto provided by Supplier.


 


“Operating Force
Majeure Events” means any event beyond the reasonable control of Supplier or
Operator, as applicable, including, without limitation, (i) war,
hostilities, insurrection, riot, vandalism or other public disorder or civil
disturbance; acts of God, fires, hurricanes, thunder storms (including thunder
storm watches or warnings declared for the area including the Project Site by
the National Weather Service), tornadoes (including tornado watches or warnings
declared for the area including the Project Site by the National Weather
Service), mudslides, hail, earthquakes, lightning (including lightning blade
strikes), or explosions; expropriation or confiscation, strikes, lockouts or
other labor disputes, a Change in Law; epidemic or quarantine; damage or
obstruction to any part of the Project caused by persons other than Supplier,
its Affiliates or their respective Subcontractors; a condition at the Site that
would not reasonably have been discovered by a project supplier comparable in
experience to Supplier conducting a competent and diligent visual inspection, (ii) wind
velocity at a constant speed or in gusts such that a reasonably prudent
professional qualified operator engaged in the business of performing routine
maintenance on wind energy generation facilities comparable to the Project
owned by it, acting for the advancement and protection of its own economic
interests, would not make the required repair at such time due to risks to
persons or property, (iii) with respect to the Turbines, any conditions at
the Project Site that are either outside the operating parameters or standards
for an IEC Class IIB wind turbine, as published as of the Effective Date
by the IEC, or outside the operating parameters or standards for the Turbine,
as set forth in the Turbine Specifications, which operating parameters or
standards may include, without limitation, conditions involving ambient
temperatures or wind speed and/or turbulence at the air density at the Project
Site, (iv) delays caused by inclement weather within the vicinity of the
Project Site and affecting the operation of the Project to the extent that such
inclement weather is materially greater than that normally experienced for the
time of year and locality and (v) unavailability of the grid for any
reason not caused by Supplier. The failure to provide Interconnection
Facilities that are energized and operational in a manner that will permit the
transmission and sale of


 


I-6

















 


power from a Turbine and
related Electrical Infrastructure shall be deemed an Operating Force Majeure
Event with respect to such Turbine until such time as the Interconnection
Facilities are provided and sufficiently operational with respect to each such
Turbine.


 


“Operator” shall
mean the person or entity hired by Project Manager to operate the Project
pursuant to the OMS Agreement.


 


“Party” and “Parties”
has the meaning given in the Preamble to the Supply Agreement.


 


“Permit” means any
valid waiver, exemption, variance, franchise, permit, authorization, license or
similar order, of or from any federal, state, county, municipal, local,
regional, or other governmental body, instrumentality, agency, authority, court
or other body having jurisdiction over the matter in question.


 


“Power Curve”
means the energy values produced by the Turbines at the various wind speed
bands set forth in Exhibit C-2 of the Warranty Agreement.


 


“Power Curve
Warranty Buydown” means any payment made pursuant to Section 3.3(c) of
the Warranty Agreement.


 


“Progress Payment”
shall have the meaning given in Section 3.3 of the Supply
Agreement.


 


“Project” has the
meaning given in the Recitals of the Supply Agreement.


 


“Project
Completion” shall occur upon the Completion of the Turbines.


 


“Project
Completion Certificate” shall mean a certificate, in the form attached as Exhibit N
to the Supply Agreement, delivered by Supplier to Purchaser following
Completion of Commissioning of the Turbines.


 


“Project Site”
means the site described in Exhibit O of the Supply Agreement.


 


“Proven Power Curve
Percentage” or “PPCP” shall have the meaning given in Exhibit B to
the Warranty Agreement.


 


“Prudent
Electrical Industry Practices” means those practices, methods, standards and
acts (including those engaged in or approved by a significant portion of the
power industry for similar facilities in the United States) that at a
particular time in the exercise of good judgment would have been expected to
comply with Governmental Requirements, and to promote safety, environmental
protection, economy and expedition.


 


“Prudent Wind
Industry Practices” means standards and practices that are widely accepted by
the wind energy industry for wind projects of this size and that are prudently
applied and reasonably anticipated and intended to maximize output and productivity
of the Turbines, consistent with their intended design lives.


 


I-7

















 


“PTC Benefits”
means the tax credits that Purchaser may be eligible to claim for the
production of renewable energy by the Project in accordance with Section 45
of the United States Internal Revenue Code, as in effect as of the date of this
Agreement.


 


“Purchaser”
includes the named Purchaser identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Purchaser Permits”
mean all Permits required in connection with the development, construction,
ownership and operation of the Project, other than the Supplier Permits.


 


“SCADA System”
means a supervisory control and data acquisition system, including a central
computer and related software, whether supplied and installed by Supplier or by
a third party, as more particularly described in the SCADA System
Specifications.


 


“SCADA System
Installation Manual” means the manual attached to the Supply Agreement as Exhibit V.


 


“SCADA System
Specifications” means those specifications set forth on Exhibit U
to the Supply Agreement, pertaining to the SCADA System.


 


“Services” shall
mean the Commissioning Work.


 


“Site Agreements”
means any agreement between Purchaser, Project Manager, Supplier or Operator,
and any third party, with respect to the operation or maintenance of the
Project.


 


“Subcontractors”
means such subcontractors, consultants or suppliers which in the Supplier’s
reasonable judgment may be necessary to complete Supplier’s duties and
obligations under the Supply Agreement.


 


“Supplier”
includes the named Supplier identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Supplier Permits”
means the Supplier Permits listed on Exhibit R to the Supply
Agreement.


 


“Supply Agreement”
means the Turbine Supply Agreement dated as of December 31, 2007 by and
between Supplier and Purchaser and any amendments thereto.


 


“Supply Items”
means, collectively, the Major Turbine Components and Ancillary Parts and
Equipment.


 


“Supply
Obligations” means Supplier’s obligations under the Supply Agreement to (i) supply
Purchaser the Supply Items and (ii) provide Purchaser certain services in
connection with the Supply Items, including (a) supplying, packing,
shipping and Delivering all Supply Items to their Designated Delivery
Locations; (b) at Purchaser’s request, providing a technical adviser to be
present at the Project Site during Turbine Installation; and (c) performing
the Commissioning Work.


 


I-8

















 


“Testing Engineer”
means Garrad Hassan Germanischer Lloyd, the National Renewable Energy
Laboratory, or Global Energy Concepts, or such other independent engineer as
mutually agreed.


 


“Tower” means each
77.4 meter steel tubular tower component of a Turbine having a hub height of
approximately eighty meters (80 m) (measured from the base of such tower to the
center of the Turbine hub) upon which a Turbine Nacelle shall be mounted,
including all ladders, platforms, internal lighting, safety equipment, and all
parts and assemblies necessary for a complete turbine tower, all as further
described in the Turbine Specifications.


 


“Tower Foundation
Requirements” means Supplier’s requirements for the foundation upon which the
Towers are to be erected (which shall specify foundation loads, bolt
configuration, cable configuration and grounding requirements).


 


“Transferee
Agreement and Acknowledgement” means the Agreement and Acknowledgement executed
by Owner and delivered to Supplier in the form attached hereto as Exhibit K
to this Agreement.


 


“Transmission
Facilities” mean the underground and/or overhead distribution, collection and
transmission lines; underground and/or overhead control, communications and
radio relay systems and telecommunications equipment; energy storage
facilities; interconnection and/or switching facilities, circuit breakers,
transformers; cables, wires, fiber, conduit, footings, foundations, towers,
poles, crossarms, guy lines and anchors, and any related or associated
improvements, fixtures, facilities, appliances, machinery and equipment.


 


“Turbine” has the
meaning given in the Recitals to the Supply Agreement.


 


“Turbine Blade”
means a turbine blade component of a Turbine (each Turbine shall have three (3) Turbine
Blades).


 


“Turbine Component
Storage Requirements” means Supplier’s standard requirements for storage and
maintenance of Turbine Components pending installation.


 


“Turbine
Controller” means the circuit breaker and controller equipment for each Turbine
as further described in the Turbine Specifications.


 


“Turbine
Installation Manual” means Supplier’s detailed manual for the Installation
Work.


 


“Turbine Nacelle”
means the turbine nacelle component of a Turbine, including gearbox, generators,
blade pitch controls, brakes, hydraulic systems, lightning protection system,
and nacelle yaw controls, and associated control and ancillary equipment.


 


“Turbine
Specifications” means those specifications set forth in Exhibit S
to the Supply Agreement pertaining to the Turbines.


 


“Turbine Supply
Documents” means, collectively, the Supply Agreement, the Warranty Agreement,
the OMS Agreement and all other agreements, documents or other instrument


 


I-9

















 


executed and delivered by
the Parties hereto in connection with the supply, installation (if applicable)
and maintenance of the Turbines.


 


“Warranted Power
Curve Percentage” or “WPCP” has the meaning given in Exhibit B to
the Warranty Agreement.


 


“Warranties” means
the Standard Warranty, the Availability Warranty, the Power Curve Warranty, the
Sound Warranty, and the IP Warranty given hereunder.


 


“Warranty
Agreement” means that certain warranty agreement by and between Supplier and
Purchaser of even date herewith, pursuant to which Supplier makes certain
covenants and warranties to Purchaser with respect to the Major Turbine
Components supplied pursuant to this Agreement.


 


“Warranty Period
Year” means, for the Turbines, the period beginning on the earlier of (a) the
date of Project Completion or (b) the six (6) months after the last Major
Turbine Component is Delivered to Purchaser, and ending exactly twelve (12)
months thereafter, and each of the following four (4) twelve (12) month periods
thereafter; provided, however that the last of such periods shall not extend
beyond the end of the Warranty Period.


 


I-10














 


[2010 TSA]


 


CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR THE REDACTED PORTIONS OF THIS AGREEMENT. THE
REDACTIONS ARE INDICATED WITH FIVE ASTERISKS (“*****”).  A COMPLETE VERSION OF THIS AGREEMENT HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.


 


Execution Copy


 


TURBINE SUPPLY AGREEMENT


 


BY AND BETWEEN


 


UPC WIND ACQUISITION V, LLC


 


AND


 


CLIPPER TURBINE WORKS, INC.


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE 1

  	
  DEFINITIONS AND RULES
  OF INTERPRETATION

  	
  1

  
	
  1.1

  	
  Definitions

  	
  1

  
	
  1.2

  	
  Rules of
  Interpretation

  	
  1

  
	
  ARTICLE 2

  	
  SUPPLY AND OTHER
  OBLIGATIONS OF SUPPLIER

  	
  2

  
	
  2.1

  	
  Supply and
  Commissioning Obligations

  	
  2

  
	
  2.2

  	
  Permits; Governmental
  Requirements

  	
  3

  
	
  2.3

  	
  Purchaser’s Right to
  Inspect

  	
  3

  
	
  2.4

  	
  Subcontractors

  	
  3

  
	
  2.5

  	
  Safety

  	
  4

  
	
  2.6

  	
  Independent Contractor

  	
  4

  
	
  ARTICLE 3

  	
  PURCHASE PRICE AND
  PAYMENT

  	
  4

  
	
  3.1

  	
  Purchase Price

  	
  4

  
	
  3.2

  	
  Taxes

  	
  4

  
	
  3.3

  	
  Progress Payments

  	
  4

  
	
  3.4

  	
  Punch List Retainage

  	
  5

  
	
  3.5

  	
  Purchaser’s Credit
  Support

  	
  6

  
	
  3.6

  	
  Warranty Agreement

  	
  6

  
	
  3.7

  	
  Operations and
  Maintenance Service Agreement

  	
  6

  
	
  ARTICLE 4

  	
  DUTIES AND OBLIGATIONS
  OF PURCHASER

  	
  6

  
	
  4.1

  	
  Purchaser’s Obligations

  	
  6

  
	
  4.2

  	
  Cooperation with
  Supplier; Purchaser’s Representative

  	
  7

  
	
  4.3

  	
  Permits; Governmental
  Requirements

  	
  8

  
	
  4.4

  	
  Safety

  	
  8

  
	
  4.5

  	
  Intellectual Property
  Rights: Licenses and Obligations

  	
  8

  
	
  4.6

  	
  Transfer

  	
  10

  
	
  4.7

  	
  Access to Information

  	
  10

  
	
  ARTICLE 5

  	
  COMMENCEMENT, DELIVERY
  AND SHIPMENT

  	
  10

  
	
  5.1

  	
  Commencement

  	
  10

  
	
  5.2

  	
  Shipping Arrangements

  	
  10

  
	
  5.3

  	
  Delivery Schedule

  	
  10

  
	
  5.4

  	
  Designated Delivery
  Locations

  	
  11

  
	
  5.5

  	
  Delay Delivery Damages

  	
  11

  
	
  ARTICLE 6

  	
  FINAL ASSEMBLY WORK,
  INSTALLATION WORK, COMMISSIONING WORK AND PROJECT COMPLETION

  	
  12

  
	
  6.1

  	
  Final Assembly Work and
  Turbine Installation

  	
  12

  
	
  6.2

  	
  Commissioning

  	
  12

  
	
  6.3

  	
  Project Completion

  	
  13

  
	
  6.4

  	
  Purchaser Delays

  	
  13

  



 


i

















 


TABLE OF CONTENTS 


(continued)


 


	
  ARTICLE 7

  	
  FORCE MAJEURE EVENTS

  	
  13

  
	
  7.1

  	
  Excused Performance

  	
  13

  
	
  ARTICLE 8

  	
  CHANGE ORDERS

  	
  14

  
	
  8.1

  	
  Change Order

  	
  14

  
	
  8.2

  	
  Change Order Process

  	
  14

  
	
  8.3

  	
  No Change

  	
  14

  
	
  8.4

  	
  Scope Changes Caused by
  a Force Majeure Event

  	
  15

  
	
  8.5

  	
  Scope Changes Caused by
  Events within the Control of Purchaser

  	
  15

  
	
  ARTICLE 9

  	
  LIMITATION OF LIABILITY

  	
  15

  
	
  9.1

  	
  Supplier Not
  Responsible for Purchaser’s Work

  	
  15

  
	
  9.2

  	
  Overall Limitation of
  Liability

  	
  15

  
	
  9.3

  	
  Consequential Damages

  	
  15

  
	
  ARTICLE 10

  	
  TITLE AND RISK OF LOSS;
  INSURANCE

  	
  16

  
	
  10.1

  	
  Title to Supply Items

  	
  16

  
	
  10.2

  	
  Risk of Loss

  	
  16

  
	
  10.3

  	
  Insurance

  	
  16

  
	
  ARTICLE 11

  	
  REPRESENTATIONS AND
  WARRANTIES OF SUPPLIER

  	
  20

  
	
  11.1

  	
  Due Organization; Good
  Standing

  	
  20

  
	
  11.2

  	
  Due Authorization

  	
  20

  
	
  11.3

  	
  Execution and Delivery

  	
  20

  
	
  11.4

  	
  Governmental Approvals

  	
  20

  
	
  11.5

  	
  Supply Items; Services

  	
  20

  
	
  ARTICLE 12

  	
  REPRESENTATIONS AND
  WARRANTIES OF PURCHASER

  	
  20

  
	
  12.1

  	
  Due Organization; Good
  Standing; Qualified To Do Business

  	
  20

  
	
  12.2

  	
  Due Authorization

  	
  21

  
	
  12.3

  	
  Execution and Delivery

  	
  21

  
	
  12.4

  	
  Governmental Approvals

  	
  21

  
	
  12.5

  	
  Project Site

  	
  21

  
	
  ARTICLE 13

  	
  MUTUAL INDEMNITY

  	
  21

  
	
  13.1

  	
  Mutual Indemnity

  	
  21

  
	
  ARTICLE 14

  	
  DEFAULT; CURE; REMEDIES

  	
  21

  
	
  14.1

  	
  Default by Supplier

  	
  21

  
	
  14.2

  	
  Purchaser’s Remedies

  	
  22

  
	
  14.3

  	
  Default by Purchaser

  	
  22

  
	
  14.4

  	
  Supplier’s Remedies

  	
  23

  
	
  14.5

  	
  Cancellation Due to a
  Force Majeure Event

  	
  23

  
	
  14.6

  	
  Termination *****

  	
  23

  
	
  14.7

  	
  Surviving Obligations

  	
  24

  



 


ii

















 


TABLE OF CONTENTS


(continued)


 


	
  ARTICLE 15

  	
  DISPUTE RESOLUTION

  	
  24

  
	
  15.1

  	
  Procedure

  	
  24

  
	
  15.2

  	
  Qualifications of
  Arbitrators; Expenses

  	
  26

  
	
  15.3

  	
  Performance During
  Dispute

  	
  26

  
	
  15.4

  	
  Consolidation

  	
  26

  
	
  15.5

  	
  Language

  	
  27

  
	
  ARTICLE 16

  	
  GENERAL PROVISIONS

  	
  27

  
	
  16.1

  	
  Waiver

  	
  27

  
	
  16.2

  	
  Successors and Assigns

  	
  27

  
	
  16.3

  	
  Permitted Assignments

  	
  27

  
	
  16.4

  	
  Notices

  	
  28

  
	
  16.5

  	
  Governing Law

  	
  29

  
	
  16.6

  	
  Amendments

  	
  29

  
	
  16.7

  	
  Attachments
  Incorporated

  	
  29

  
	
  16.8

  	
  Entire Agreement

  	
  29

  
	
  16.9

  	
  Confidentiality

  	
  29

  
	
  16.10

  	
  Counterparts

  	
  29

  
	
  16.11

  	
  English Language
  Documents

  	
  30

  
	
  16.12

  	
  Severability

  	
  30

  
	
  16.13

  	
  Headings

  	
  30

  
	
  16.14

  	
  Agreement Revisions

  	
  30

  



 


iii

















 


Exhibits


 


	
  Appendix I

  	
  Definitions

  
	
  Exhibit A

  	
  Ancillary Parts and
  Equipment

  
	
  Exhibit B

  	
  Payment Schedule

  
	
  Exhibit C

  	
  Spare Parts

  
	
  Exhibit D

  	
  Turbine Installation
  Manual

  
	
  Exhibit E

  	
  Foundation Loads
  Document

  
	
  Exhibit F

  	
  Turbine Component Storage
  Requirements

  
	
  Exhibit G

  	
  Termination Schedule

  
	
  Exhibit H

  	
  Supplier’s Major
  Turbine Component Suppliers

  
	
  Exhibit I

  	
  Supplier Account

  
	
  Exhibit J

  	
  Guaranty

  
	
  Exhibit K

  	
  Transferee Agreement
  and Acknowledgment

  
	
  Exhibit L

  	
  Delivery Schedule

  
	
  Exhibit M

  	
  Commissioning
  Certificate

  
	
  Exhibit N

  	
  Project Completion
  Certificate

  
	
  Exhibit O

  	
  Commissioning and
  Start-Up Procedures

  
	
  Exhibit P

  	
  Final Assembly Work

  
	
  Exhibit Q

  	
  Project Site

  
	
  Exhibit R

  	
  Supplier Permits

  
	
  Exhibit S

  	
  Turbine Specifications

  
	
  Exhibit T

  	
  Completion Schedule

  
	
  Exhibit U

  	
  SCADA System
  Specifications

  
	
  Exhibit V

  	
  SCADA System
  Installation Manual

  



 


i

















 


TURBINE SUPPLY AGREEMENT


 


THIS TURBINE SUPPLY AGREEMENT (the “Agreement” or the “Supply
Agreement”) is made and entered into and effective as of December 31, 2007
by and between CLIPPER TURBINE WORKS, INC., a Delaware corporation (“Supplier”),
and UPC WIND ACQUISITION V, LLC, a Delaware limited liability company with a
place of business c/o UPC Wind Management, LLC, 85 Wells Ave., Suite 305,
Newton, MA 02459 (“Purchaser”). Supplier and Purchaser are sometimes referred
to, individually, as a “Party” or, collectively, as the “Parties”.


 


RECITALS


 


WHEREAS, Purchaser desires to purchase, and Supplier
desires to sell eighty (80) Clipper Windpower 2.5 MW “C-99” series wind turbine
generators (each a “Turbine” and collectively, the “Turbines”), each consisting
of the Major Turbine Components and Ancillary Parts and Equipment (as set forth
in Exhibit A hereto). Additionally, Purchaser, in connection with
its purchase of the Turbines, desires to purchase and Supplier desires to
provide the Commissioning Work (as defined in Appendix I hereto), all on
the terms and subject to the conditions set forth herein.


 


WHEREAS, Purchaser shall incorporate the Turbines into
a single 200 MW wind power project being developed by Purchaser located in
Milford, Utah (the “Project”).


 


NOW, THEREFORE, for good and valuable consideration,
the receipt and adequacy of which is hereby acknowledged, Supplier and
Purchaser, intending to be legally bound, hereby agree as follows:


 


AGREEMENT


 


ARTICLE 1


 


DEFINITIONS AND
RULES OF INTERPRETATION


 


1.1         Definitions.
For purposes of the Turbine Supply Documents and all schedules, exhibits and
attachments thereto, and in addition to the definitions elsewhere in this
Agreement and the other Turbine Supply Documents, the terms listed in Appendix
I hereto shall have the respective meanings assigned to such terms in Appendix
I hereto, which is incorporated herein and made a part hereof.


 


1.2         Rules of
Interpretation. In this Agreement: (a) references to Sections and to
Exhibits are, unless otherwise indicated, to Sections of and Exhibits to this
Agreement; (b) the headings to Sections and Articles of this Agreement are
for ease of reference only and shall not in any way affect its construction or
interpretation; (c) the masculine gender shall include the feminine and
neuter and the singular number shall include the plural, and vice versa, and
references to persons shall include individuals, bodies corporate,
unincorporated associations, companies and partnerships; and (d) references
to Parties in this Agreement shall be deemed to include references to their
successors and permitted assigns.


 


1

















 


ARTICLE 2


 


SUPPLY
AND OTHER OBLIGATIONS OF SUPPLIER


 


2.1        Supply
and Commissioning Obligations. Purchaser hereby agrees to purchase and,
subject to the terms and provisions hereof, Supplier agrees to supply and
Deliver as provided in Subsections (a) and (b) below, the Supply
Items and related Services for the Turbines. With respect to the Supply Items
and related Services, following Purchaser’s submittal to Supplier of the Down
Payment, and subject to the compliance by Purchaser with the terms hereof,
Supplier agrees to do the following respecting the Supply Items and Services:


 


(a)   supply,
pack, and Deliver, in accordance with wind industry practice and commercially
reasonable shipping carrier requirements and in an economic manner consistent with
wind industry practices, all Supply Items, the SCADA System and all related
components and parts (other than foundations, foundation bolts, pad mount
transformers and collection lines, communication lines and related equipment to
be supplied by Purchaser) necessary to install and commission wind turbine
generators in the quantity set forth above that are capable of performing to
the Turbine Specifications (the “Supply Obligations”);


 


(b)    perform
the Commissioning Work, as described in Section 6.2 below.


 


2.1.1            Failure
to Timely Deliver Down Payment. If Purchaser fails to deliver to Supplier
the Down Payment on or before the Down Payment Date, then Purchaser’s right to
purchase and Supplier’s obligation to sell and Deliver the Supply Items and
related Services shall terminate at the option of Supplier and be of no further
force or effect, provided that Supplier shall first give Purchaser five (5) days
written notice to afford Purchaser the opportunity to correct its performance.


 


2.1.2            Spare Parts.


 


(a)    During the Warranty
Period, Supplier shall maintain an inventory of spare parts at such location
and consisting of such spare parts as Supplier, in its sole discretion, shall
determine necessary for the timely operation and maintenance of the Turbines
during the Warranty Period (the “Necessary Spare Parts Inventory”). The list of
spare parts proposed by Supplier is attached hereto as Exhibit C.
It is the intention of the parties that the Necessary Spare Parts Inventory be
used and maintained during the Warranty Period in order for Supplier to fulfill
its obligations under the OMS Agreement and the Warranty Agreement.


 


(b)    Purchaser may
purchase such additional spare parts, at Purchaser’s sole expense, and maintain
such additional spare parts on the Project Site, at Purchaser’s sole expense;
provided that such spare parts are available from Supplier without unreasonably
impacting Supplier’s production of turbines.


 


(c)    Within six (6) months
of the date of final payment by Purchaser to Supplier of the Purchase Price,
Supplier shall place into escrow with an escrow agent to be agreed upon between
the parties, subject to an escrow agreement to be agreed between the parties, drawings
(the “Spare Parts Drawings”) necessary for Purchaser to make or have made any
spare parts for the Turbines whose manufacture are subject to intellectual
property rights of Supplier.


 


2

















 


Pursuant to the terms of
the agreed upon escrow agreement, Purchaser shall be provided access to the
Spare Parts Drawings only if and when Supplier is unable to provide necessary spare
parts for the Turbines to Purchaser due to a default under Section 14.1(i),
(ii), (iii) or (iv) under this Agreement.


 


2.1.3     SCADA System.
Purchaser shall purchase the SCADA System from Supplier (exclusive of any fiber
optic lines or other communication lines) for an amount equal to ***** Dollars
($*****). The price of the SCADA System is included in the Purchase Price.


 


2.1.4    [Intentionally Left
Blank].


 


2.1.5    Other Items.
Supplier has provided Purchaser with: the Turbine Installation Manual, a copy
of which is set forth on Exhibit D; the Foundation Loads Document,
a copy of which is set forth on Exhibit E; and the Turbine
Component Storage Requirements, a copy of which is set forth on Exhibit F.
No later than ten (10) days prior to the anticipated Commissioning of the
first Turbine, Supplier shall provide to Purchaser the OMS Manual. Concurrently
with the execution of this Agreement, Supplier and Purchaser shall deliver to
the other Party the Warranty Agreement and the OMS Agreement, duly executed by
each Party. At Purchaser’s request and at Purchaser’s cost, within twelve (12)
months of Commissioning of the last Turbine, Supplier shall provide to
Purchaser a location specific site suitability certificate from Germanischer
Lloyd.


 


2.2        Permits;
Governmental Requirements. Supplier shall secure and pay for all Supplier
Permits required for the Delivery of the Supply Items to the Designated
Delivery Location. Purchaser shall cooperate with Supplier in obtaining the
Supplier Permits. Supplier shall have no obligation to obtain any Purchaser
Permit; provided Supplier shall cooperate with Purchaser in Purchaser’s efforts
to obtain and comply with Purchaser Permits. Supplier shall comply with all
Governmental Requirements applicable to the performance of its obligations
hereunder.


 


2.3        Purchaser’s Right to
Inspect. Supplier shall permit Purchaser, upon ten (10) days prior
written notice to Supplier, to inspect the Turbines and to visit Supplier’s
Turbine manufacturing and assembly facilities for such purpose, subject in all
cases to Supplier’s confidentiality requirements and reasonable safety
precautions, and so long as such inspection and presence does not unreasonably
interfere with or delay the completion or Delivery of the Turbines or Supplier’s
performance of its obligations hereunder.


 


2.4        Subcontractors.
Supplier may retain such Subcontractors as in Supplier’s reasonable judgment
may be necessary to complete Supplier’s duties and obligations under this
Agreement. Supplier shall be solely responsible to pay its Subcontractors and
the use of any Subcontractor shall not limit Supplier’s obligations hereunder.
The list of Supplier’s Major Turbine Component suppliers is set forth on Exhibit H.
Supplier agrees that it will not use any Major Turbine Components not listed in
Exhibit H without Purchaser’s advance written consent, such consent not to be
unreasonably withheld, conditioned or delayed.


 


3

















 


2.5        Safety. Until
any Supply Item has been Delivered, Supplier shall take reasonable steps to
protect each Supply Item against damage, destruction or theft, and shall ensure
that all Supplier Insurance covering the Turbines remains in full force and
effect prior to Delivery.


 


2.6        Independent
Contractor. In performing its duties and obligations under this Agreement,
Supplier shall, at all times, act in the capacity of an independent contractor,
and shall not in any respect be deemed (or act as) an agent of Purchaser for
any purpose or reason whatsoever. Supplier shall have no responsibility for any
of Purchaser’s Work hereunder.


 


ARTICLE 3


 


PURCHASE PRICE AND PAYMENT


 


3.1         Purchase
Price. For the Supply Items, SCAD A System and Services, Purchaser shall
pay to Supplier ***** Dollars ($*****) (the “Purchase Price”). Purchaser shall
pay to Supplier on the date of this Agreement (the “Down Payment Date”) a
non-refundable amount equal to ***** percent (*****%) of the Purchase Price
(the “Down Payment”). All payments to be made under this Agreement by Purchaser
to Supplier shall be made in immediately available funds to the Supplier
account set forth in Exhibit I. The Purchase Price is subject to
adjustment by Change Order as provided in this Agreement.


 


3.2         Taxes.
Supplier shall be responsible for (a) all federal and state income taxes
payable by Supplier in connection with its net income, (b) all taxes in
connection with the import of any Supply Item into the United States, and (c) any
business license or fees arising in connection with Supplier’s business in any
State. Purchaser shall be responsible for all sales and use tax and any other
federal, state or local taxes imposed on the sale or use of the Supply Items
and any services provided hereunder (collectively “Taxes”).


 


3.3         Progress
Payments.


 


3.3.1    The remaining amount of
the Purchase Price shall be paid by the Purchaser to the Supplier pursuant to
the Payment Schedule set forth on Exhibit B attached hereto (the “Payment
Schedule”). Upon completion of each of the milestones for the Project set forth
on Exhibit B attached hereto, the corresponding portion of the
Purchase Price shall be due and payable to Supplier as set forth on Exhibit B
attached hereto (each, a “Progress Payment”).


 


(a)     Purchaser shall pay
the Down Payment and each Progress Payment to Supplier in United States Dollars
and in immediately available funds to the account of Supplier, identified on Exhibit I.
Should Purchaser fail to make any Progress Payment when due, in addition any
other remedy available to Supplier under this Agreement, or otherwise, (i) Supplier
may enforce the Guaranty as set forth in Section 3.5 pursuant to
its terms; (ii) such overdue amount shall bear interest until paid in full
at the Default Rate, and (iii) Supplier may, without prejudice to any
other rights or remedies it may have under this Agreement, stop its performance
hereunder until the overdue amount and interest thereon is paid in full.


 


(b)    Provided that Supplier has
duly performed or is reasonably performing its obligations hereunder and
irrespective of any other term of this Agreement, and provided that any delay
in obtaining the Project Completion Certificate within six (6) months


 


4






 










 


after Delivery of
the last Major Turbine Component by Supplier for the Project is not caused
solely by Supplier or any of Supplier’s Affiliates or subcontractors, one
hundred percent (100%) of the Purchase Price, subject to the retention of the
applicable Punch List Retainage, shall be paid by Purchaser to Supplier no
later than six months after Delivery of the last Major Turbine Component by
Supplier for the Project.


 


*****


 


3.4         Punch
List Retainage. In delivering the Project Completion Certificate as provided
in Section 6.3 below hereunder, Supplier shall include an estimated
cost to complete each item of Punch List Work (200% of such estimated costs
being the “Punch List Retainage”). The Progress Payment corresponding to
delivery of the Project Completion Certificate shall be decreased by an amount,
if any, which is equal to the Punch List Retainage, and upon the completion of
any item of Punch List Work to the reasonable satisfaction of Purchaser,
Purchaser shall immediately pay Supplier the Punch List Retainage that was
retained by Purchaser for such item of Punch List Work.


 


5

















 


3.5         Purchaser’s Credit
Support. Purchaser shall, concurrently with the delivery by Purchaser of
the Down Payment, deliver to Supplier a guaranty from its parent company (the “Guaranty”)
in substantially the form attached hereto as Exhibit J.


 


3.6         Warranty
Agreement. The Parties acknowledge that, concurrent with the execution of
this Agreement, the Parties shall enter into the Warranty Agreement. The cost
of the first two (2) years of warranty coverage under the Warranty
Agreement is included in the Purchase Price.


 


3.7         Operations
and Maintenance Service Agreement. Concurrent with the execution of this
Agreement, Affiliates of the Purchaser and Supplier shall execute an OMS
Agreement whereby Supplier, an Affiliate of Supplier, or a contractor
designated by Supplier and approved by Purchaser (the “Contractor”) shall
provide operation and maintenance service to the Project. Pursuant to the terms
of the OMS Agreement, the cost for the first two (2) years of OMS Services
(other than Additional OMS Services) is included in the Purchase Price.


 


ARTICLE 4


 


DUTIES AND OBLIGATIONS OF PURCHASER


 


4.1         Purchaser’s
Obligations. Purchaser agrees to perform the following, all on the terms
and subject to the conditions of this Agreement:


 


4.1.1        Payment.
Purchaser shall make the Down Payment, all Progress Payments and any other
payments due Supplier under this Agreement when due and shall be responsible
for and promptly pay all Taxes.


 


4.1.2        Purchaser’s
Work. Purchaser shall, at its sole cost and expense, be solely responsible
for all work necessary for the development, construction, completion and
operation of the Project (other than the Delivery of Supply Items and the
performance of the Services by Supplier) and for the installation and operation
of the Turbines, which work (herein “Purchaser’s Work”) shall include the
following:


 


(a)    Site Suitability and
Access. Purchaser shall ensure that the Project Site is suitable for
installation of the Turbines in accordance with the Turbine Specifications and
Turbine Installation Manual and shall ensure that Supplier has continuous
unfettered physical access to the Project Site during normal business hours during
the performance of its Commissioning Work;


 


(b)    Acceptance and Shipment
of Supply Items. Upon Supplier’s Delivery of any Supply Item to its
respective Designated Delivery Location, Purchaser shall, unless otherwise
agreed by the Parties, within five (5) days after notice from Supplier and
at such date and time set forth in Supplier’s notice, pick up the Supply Item
at its Designated Delivery Location, and ship, install or store such Supply
Item at the Project Site. Purchaser shall be responsible for any reasonable
costs incurred by Supplier due to Purchaser’s delay in promptly picking up and
transporting off site any Supply Item upon its Delivery within said five (5) day
period. Purchaser shall be solely responsible for shipment and insurance of
each Supply Item once picked up;


 


6

















 


(c)    Storage. Purchaser
shall ensure that adequate staging, lay down and storage areas for the Supply
Items are available and maintained at the Project Site and shall store and
maintain the Supply Items pending installation in accordance with the Turbine
Component Storage Requirements set forth on Exhibit F;


 


(d)    Tower Foundations.
Purchaser shall investigate the Project Site and its soil conditions and shall
design and construct the Tower Foundations in accordance with Supplier’s Tower
Foundation Requirements;


 


(e)    Turbine and SCADA System
Installation. Purchaser shall perform the Turbine Installation Work and the
installation of the SCADA System, all in strict accordance with the Turbine
Specifications, the Turbine Installation Manual and the SCADA System
Installation Manual; and shall (i) notify Supplier of Purchaser’s proposed
schedule for all such work; (ii) coordinate such work with Supplier’s
Commissioning Work for the Turbines; and (iii) complete the Installation
Work in such a manner so that a team of two technicians can complete the
Commissioning of each Turbine within a period not to exceed three and a half (3
1⁄2) Business Days, without interruption or delay on a continuous basis until all
Turbines have been Commissioned;


 


(f)    Construction of Project.
Purchaser shall (i) perform the Final Assembly Work which is set forth in Exhibit P
hereto. (ii) perform all civil works (including roads, grading,
maintenance facilities, meteorological towers and other items); (iii) perform
all electrical works (including collection lines, Electrical Infrastructure,
Transmission Facilities, Interconnection Facilities and other items); (iv) provide
and install a remote terminal unit and cabling to the Substation,
meteorological towers, and communications lines for the SCADA System to the
Substation; and (v) provide any other items required for the operation of
the Project; and


 


(g)    Commissioning
Responsibilities. Purchaser shall ensure that at all times during
Commissioning Work, each Turbine shall have a continuous supply of electricity
from the grid, and that Purchaser’s utility will accept electricity generated
by such Turbine. During Commissioning, Purchaser shall provide assistance,
including equipment, electricians and mechanics, as may be reasonably required
by Supplier to address any out of scope impacts on the completion of
Commissioning. Purchaser shall arrange for the provision of full grid power to
each Turbine to ensure completion of the Commissioning Work for each Turbine.


 


4.1.3    Other Items. On or
before the date that is thirty (30) days prior to the date of Delivery of the
first Major Turbine Component for the Project, Purchaser shall provide Supplier
with notification of the anticipated date that Purchaser will energize the
substation for the Project.


 


4.2         Cooperation with
Supplier; Purchaser’s Representative. Purchaser shall cooperate with
Supplier and, if applicable, shall cause its EPC Contractor and any other
contractors engaged by Purchaser with respect to the Project (herein, “Purchaser’s
Contractors”), to cooperate with Supplier, all in connection with Supplier’s
performance of its obligations hereunder. Purchaser shall promptly provide
Supplier with a schedule of the names and contact information for all of
Purchaser’s


 


7

















 


Contractors and shall
update such schedule periodically. Purchaser designates Scott Rowland as its
representative (“Purchaser’s Representative”) in dealing with Supplier with
respect to this Agreement.


 


4.3         Permits;
Governmental Requirements. Purchaser shall secure and pay for all Purchaser
Permits, including any permits required for the delivery of Supply Items from
the Designated Delivery Location to the Project Site. Supplier shall cooperate
with Purchaser in obtaining Purchaser’s Permits. Purchaser shall have no
obligation to obtain any Supplier Permit; provided that, Purchaser shall
cooperate with Supplier in Supplier’s efforts to obtain Supplier Permits.
Purchaser shall comply with all Governmental Requirements applicable to the
performance of Purchaser’s Work.


 


4.4         Safety.
Upon Delivery of any Supply Item to its Designated Delivery Location, Purchaser
shall take reasonable steps, and shall ensure that the EPC Contractor and the
Purchaser’s Contractors take reasonable steps, to protect any such Supply Item
against damage or theft.


 


4.5         Intellectual
Property Rights; Licenses and Obligations.


 


4.5.1              Patents. Supplier hereby
grants to Purchaser under Supplier’s patent rights, only the non-exclusive
right to use the Supply Items provided to Purchaser under this Agreement.
Supplier expressly reserves all other patent rights, including, without
limitation, the right to make, use, sell, offer for sale and import other
products identical to or similar to the Supply Items. Other than the rights
granted herein with respect to the Supply Items, Supplier expressly reserves
all other patent rights, and Purchaser shall not have the right under Supplier’s
patent rights to make, use, sell, offer for sale, or import any products or
methods that infringe Supplier’s patents or to sublicense any of the foregoing
rights.


 


4.5.2              Trade Secrets. Purchaser
acknowledges that the technical, operation and maintenance, and other
information it receives in connection with the Supply Items (including, without
limitation, any and all firmware, software, Turbine Specifications, SCADA
System Specifications, installation and operation and maintenance procedures,
know-how and similar items) constitute trade secret information that is
proprietary to Supplier. Supplier hereby grants to Purchaser under Supplier’s
trade secret rights, the non-exclusive right to use such trade secrets only in
the installation and operation and maintenance of the Supply Items. Supplier
further grants to Purchaser under Supplier’s trade secret rights, the
non-exclusive right to disclose such trade secrets to a third party only as
necessary for the financing, installation and operation and maintenance of the
Supply Items provided such third party executes a written agreement obligating
it to maintain the confidentiality of the trade secret information and to
return all copies of such trade secret information received and prohibiting
reverse engineering, disassembly, and decompilation of any of the trade secret
information. Other than the rights granted herein with respect to the Supply
Items, Supplier expressly reserves all other trade secret rights. Purchaser
agrees to maintain all such trade secret information in strict confidence and
shall not disclose such trade secret information to any third party except in
accordance with this Section 4.5.2. The obligations of
confidentiality herein shall survive termination or expiration of this
Agreement.


 


4.5.3              Copyrights. Purchaser
acknowledges that the technical, operation and maintenance, and other
information it receives in connection with the Supply Items (including,


 


8

















 


without limitation, any and all firmware, software, Turbine
Specifications, SCADA System Specifications, installation and operation and
maintenance procedures, descriptions of know-how and similar written items)
constitute copyrightable material. Supplier hereby grants to Purchaser under
Supplier’s copyrights, the non-exclusive right to copy and use such copyrighted
materials only in the installation and operation and maintenance of the Supply
Items. Supplier further grants to Purchaser under Supplier’s copyrights, the
non-exclusive right to copy the copyrightable materials and distribute such to
a third party only as necessary for the installation and operation and
maintenance of the Supply Items, provided such third party executes a written
agreement obligating it to return all copies of such copyrightable materials
received, prohibiting any further copying or distribution of such copyrightable
materials, and prohibiting reverse engineering, disassembly and decompilation
of any of the copyrightable materials. Other than the rights granted herein
with respect to the Supply Items, Supplier expressly reserves all other
copyright rights. Purchaser shall not have the right to sublicense any of the
Supplier’s copyright rights or the right to create derivative works of any of
the copyrightable materials. Purchaser shall not reverse engineer, disassemble
or decompile any of the copyrightable materials.


 


4.5.4              Trademarks and Service Marks.
Purchaser shall not have any rights in any trademarks or service marks, whether
registered or not, that are owned or controlled by Supplier. Purchaser shall
not utilize any trademark or service mark that is substantially similar to any
trademarks or service marks owned or controlled by Supplier. Purchaser may
reference only those trademarks or service marks owned by Supplier in its
written materials; provided that, such reference clearly denotes that such is a
trademark or service mark and is owned by Supplier.


 


4.5.5             Transfer
of Title in Supply Items. Should Purchaser transfer title in any of the
Supply Items to a third party, the licenses provided in this Section 4.5
shall run with such Supply Items, provided such third party executes a
Transferee Agreement and Acknowledgment, in the form attached hereto as Exhibit K,
acknowledging Supplier’s ownership in the respective Intellectual Property
Rights and obligating itself to all of the same prohibitions and restrictions
with respect to Supplier’s Intellectual Property Rights described in this Section 4.5.
Purchaser acknowledges that the Supply Items may be subject to the export
control laws and regulations of the United States of America and agrees to
comply with all such laws and regulations regarding any export of any of the
Supply Items.


 


4.5.6              Ownership and Injunctive Relief.
All Intellectual Property Rights owned or controlled by Supplier shall remain
the exclusive property of Supplier and nothing herein shall be construed as a
sale, lease, loan, or transfer of any of such Intellectual Property Rights.
Purchaser shall derive no rights, title or interest therein except as expressly
set forth in this Agreement. Any technical information concerning the Supply
Items that Purchaser acquires or develops in connection with the ownership or
operation of the Turbines shall be the property of Supplier. Further, Purchaser
acknowledges that a breach of the confidentiality provisions in this Agreement
may cause Supplier irreparable harm and damage that may not be recoverable at
law and that Purchaser shall be entitled to obtain injunctive relief in
addition to any other rights or remedies Purchaser may have.


 


4.5.7              Government Rights. Any and
all computer software and related documentation provided as part of the Supply
Items are “commercial items” as that term is defined at 48 C.F.R. 2.01 (October 1995)
comprising “commercial computer software” and


 


9

















 


“commercial
computer software documentation” as used in 48 C.F.R. 12.212 (September 1995)
and other applicable acquisition regulations and are provided to the U.S.
Government only as a commercial item and subject to the terms and conditions
and all restrictions set forth in this Agreement as applicable to such computer
software and related documentation. Consistent with 48 C.F.R. 12.212 and 48
C.F.R. 227.7202 (June 1995), all U.S. Government users and licensees
acquire the software and its related documentation with only those rights
applicable to such software and related documentation as set forth in this Section 4.5.


 


4.6         Transfer.
Purchaser covenants and agrees that it will not sell, lease or otherwise
transfer the Turbines or any part thereof unless Purchaser first obtains and
delivers to Supplier a Transferee Agreement and Acknowledgment, executed by the
proposed transferee. Notwithstanding anything else contained herein, Purchaser
may assign in whole or in part its rights under this Agreement to an Affiliate
upon notice to Supplier.


 


4.7         Access
to Information. From the date of this Agreement through the end of the
fifteenth (15th) year after Project Completion, Purchaser shall provide to
Supplier prompt access to all technical, operational and maintenance and other
information it receives or collects in connection with its operating the
Turbines. The collection of all such data shall be at the reasonable expense of
Supplier. All information provided by Purchaser hereunder shall be subject to
the provisions of Section 16.9.


 


ARTICLE 5


 


COMMENCEMENT, DELIVERY AND SHIPMENT


 


5.1         Commencement.
Subject to Section 2.1.1, Supplier shall commence performance of
its obligations under this Agreement on the Down Payment Date. In addition to
Supplier’s other rights and remedies hereunder, if any payment due under this
Agreement is not timely made by Purchaser, the delinquent payment amount shall
accrue interest at the Default Rate.


 


5.2         Shipping
Arrangements. All Supply Items shall be delivered Ex Works at the
Designated Delivery Locations. For purposes of this Agreement, each individual
Supply Item and the SCADA System shall be deemed “Delivered” and Supplier shall
have satisfied its delivery arrangements with respect thereto, when Supplier
makes available such Supply Item and SCADA System at its Designated Delivery
Location for pick up by Purchaser, provided however, that Purchaser may not
take custody and control of the said Supply Item until the applicable Progress
Payment has been made by Purchaser and received by Supplier. Purchaser shall be
responsible for all loading and shipment of the Supply Items and SCADA System
from their respective Designated Delivery Locations to the Project Site and
shall pay for all costs and expenses incurred by Purchaser related thereto,
including the costs of maintaining insurance on such Supply Item and SCADA
System during shipment of such Supply Item and SCADA System from its respective
Designated Delivery Location to the Project Site.


 


5.3         Delivery
Schedule. The Supply Items shall be Delivered to their Designated Delivery
Locations in accordance with the Delivery Schedule attached as Exhibit L
(the “Delivery Schedule”); provided however, that Supplier shall use commercially
reasonable efforts to work with Purchaser to revise the Delivery Schedule as
necessary considering Supplier’s manufacturing


 


10

















 


schedules and Purchaser’s Project requirements. Delivery dates in the
Delivery Schedule will be deemed met so long as the Supply Items are delivered
to the Designated Delivery Locations on or before the date for such delivery
set forth in the Delivery Schedule; provided that, Supplier shall have the
right to Deliver the Supply Items up to one (1) month earlier than
provided for in the Delivery Schedule. The SCADA System shall be delivered at a
Designated Delivery Location mutually agreed by the Parties following the
installation of the first Turbine at the Project Site by Purchaser.


 


5.4         Designated
Delivery Locations. Unless otherwise agreed in writing by the Parties,
Supplier shall Deliver the Supply Items as follows: (i) Turbine Nacelle,
Turbine Controller, Turbine hub and Ancillary Parts and Equipment at Supplier’s
factory near Cedar Rapids, Iowa, (ii) the Turbine Blades at such location
or warehouse facility as Supplier may direct near Houston, Texas, or at another
mutually agreed upon location, provided any costs associated with such other
mutually agreed location be borne by Purchaser, and (iii) the Towers at
the manufacturing facility located in Chattanooga, Tennessee, or at such other
domestic location as Supplier may specify at any point prior to three (3) months
from the Delivery date set forth in the Delivery Schedule. Each of the
foregoing locations is referred to herein as a “Designated Delivery Location.”


 


5.5         Delay
Delivery Damages. The Parties acknowledge that Purchaser will suffer
damages that will be difficult to ascertain if Purchaser fails to Deliver any
Major Turbine Component within thirty (30) days of the applicable date of
Delivery set forth in the Delivery Schedule. Consequently, the Parties agree
that Supplier will pay Purchaser, if any Major Turbine Component is Delivered thirty
(30) days or more late and such delay was not due to any Force Majeure Event or
breach by Purchaser of any of its obligations under this Agreement, the
following amount as liquidated damages: For each full day after the first thirty
(30) days following the date that the Delivery of such Major Turbine Component
is delayed beyond the date specified in the Delivery Schedule, an amount equal
to $***** per Turbine per day for the first fifteen (15) days after delay
payments become payable, an amount equal to $***** per day for the next fifteen
(15) days, and an amount equal to $***** per day thereafter (the “Delay
Delivery Damages”); provided that, in no event shall the aggregate Delay
Delivery Damages payable hereunder exceed ***** percent (*****%) of the
pro-rata portion of the Purchase Price applicable to the Turbine for which such
delayed Major Turbine Component is a component. It is understood and
acknowledged by the Parties that if more than one Major Turbine Component
applicable to a Turbine is delivered late, the liquidated damages applicable to
the Turbine will not exceed $***** per day (for the first 15 days after delay
payments become payable), $***** per day (for the next 15 days of delay
payments), and $***** per day (for delay payments thereafter). The Parties
acknowledge and agree that the Delay Delivery Damages set forth above are a
reasonable estimate of the damages Purchaser will suffer because of late
Delivery of any Major Turbine Component and that, therefore, the Delay Delivery
Damages set forth herein shall be Purchaser’s sole and exclusive remedy with
respect to such Delivery delays.


 


11

















 


ARTICLE 6


 


FINAL ASSEMBLY WORK, INSTALLATION
WORK,

COMMISSIONING WORK AND PROJECT COMPLETION


 


6.1         Final
Assembly Work and Turbine Installation. Purchaser shall complete the Final
Assembly Work with respect to all Turbines in conformance with the procedures
and requirements set forth in Exhibit P. and shall complete the
Installation Work with respect to all Turbines in accordance with the Installation
Procedures and, subject to Section 5.3 above, within the period of
time set forth on the Completion Schedule.


 


6.2         Commissioning.
Commissioning of the Turbines shall be conducted as follows:


 


6.2.1           Advance
Completion Notice. No less than thirty (30) days prior to the date
Purchaser expects Supplier to commence the Commissioning Work, Purchaser shall
provide Supplier with written notice (the “Advance Completion Notice”) of
Purchaser’s anticipated completion date of the Installation Work and the date
on which Supplier shall commence the Commissioning Work (which date shall be no
later than the date that Supplier is obligated to commence the Commissioning
Work as set forth in the Completion Schedule). Purchaser shall use commercially
reasonable efforts to schedule Turbine Installation for all Turbines in the
Project so that Supplier can complete the Commissioning of each Turbine without
interruption or delay on a continuous basis until all the Turbines have been
Commissioned.


 


6.2.2              Turbine Installation Inspection.
Following completion of the Installation Work with respect to any Turbine,
Purchaser shall deliver a written notice of completion to Supplier (an “Installation
Completion Notice”) and Supplier shall examine each Turbine in accordance with
the Installation Procedures and the Turbine Installation Manual. If the Turbine
fails to conform to the standards contained in the installation inspection
procedures set forth in the Turbine Installation Manual, then it shall be
deemed not properly installed, and Supplier shall promptly so notify Purchaser.
Purchaser shall then promptly take all required action to complete the
Installation Work for all Turbine(s) failing the installation inspection
procedures.


 


6.2.3             Commissioning
Work. Supplier shall perform the Commissioning Work for the Turbines in
accordance with the Commissioning and Start-Up Procedures and the Completion
Schedule, subject to any adjustment in the completion of the Commissioning
Work, pursuant to Section 5.3 hereof, due to Supplier’s early
Delivery of the Supply Items (provided, however, that Supplier’s obligation to
Complete the Commissioning Work by such time set forth on the Completion
Schedule shall be extended to the extent of Purchaser’s delay in completing the
Installation Work). Upon completion of the Commissioning of each Turbine,
Supplier shall issue to Purchaser a commissioning certificate for such Turbine
in the form attached hereto as Exhibit M (each a “Commissioning
Certificate”). Within five (5) days after receipt of a Commissioning
Certificate, Purchaser shall either approve such Commissioning Certificate or
deliver to Supplier written notice of any work remaining to be completed by
Supplier (the “Punch List Work”). If Purchaser fails to deliver such notice
within such five (5) day period, the Commissioning Certificate will be
deemed approved by Purchaser.


 


12

















 


6.3         Project Completion.
Within five (5) days after the delivery by Supplier to Purchaser of a
Commissioning Certificate for the Project’s final Turbine, Supplier shall also
deliver to Purchaser a completion certificate for all Turbines in the Project
(the “Project Completion Certificate”), in the form attached hereto as Exhibit N.
together with a list of any remaining Punch List Work on any Turbine, a
schedule for completing the Punch List Work and an estimate of the cost of each
item of Punch List Work. Supplier shall thereafter promptly complete all Punch
List Work.


 


6.4         Purchaser
Delays. In the event that any of the actions of Purchaser, the EPC
Contractor or any of Purchaser’s Contractors cause a delay in the performance
by Supplier of the Commissioning Work, Purchaser shall pay Supplier its actual
documented costs directly attributable to such delay, including wages, lodging
and meals.


 


ARTICLE 7


 


FORCE MAJEURE EVENTS


 


7.1         Excused
Performance. If either Party is rendered wholly or partially unable to
perform its obligations (other than payment obligations) under this Agreement
due to the occurrence of a Force Majeure Event, such Party will be excused from
the affected performance obligation (other than payment obligations), provided
that:


 


(a)       the
affected Party gives the other Party notice describing the particulars of the
occurrence, including an estimate of its expected duration and probable impact
on the affected Party’s obligations hereunder, such notice shall be given
promptly after becoming aware of the occurrence of the Force Majeure Event,
and, in no event more than seven (7) days after the affected Party becomes
aware or should reasonably have been aware of such occurrence;


 


(b)      the
affected Party shall continually exercise all commercially reasonable efforts
to mitigate the effect of such Force Majeure Event, remedy its inability to
perform, and limit damages to the other Party and shall promptly resume its
performance when the Force Majeure Event no longer impacts its ability to
perform, and shall give the other Party prompt notice of its intent to resume
such performance;


 


(c)       the
suspension of a Party’s performance affected by the Force Majeure Event shall
be of no greater scope and of no longer duration than is reasonably required by
the Force Majeure Event;


 


(d)      no
liability of either Party which arose before the occurrence of the Force
Majeure Event shall be excused as a result of the occurrence thereof; and


 


(e)       no
Force Majeure Event shall relieve any Party from performing those of its
obligations that are not materially affected by the Force Majeure Event.


 


13

















 


ARTICLE 8


 


CHANGE ORDERS


 


8.1         Change Order.
The term “Change Order” as used herein shall mean a written instrument signed
by Purchaser and Supplier, stating their mutual agreement upon any of the
following: (i) a change in the fabrication or features of the Turbines
(such as adding Federal Aviation Administration lighting or a cold weather
package); (ii) a change in the Delivery Schedule or Completion Schedule; (iii) a
change in the Commissioning Work; (iv) a change in the number of or
location of Project sites; or (v) an adjustment in the Purchase Price
(collectively “Scope Changes”).


 


8.2         Change Order
Process. Purchaser may request Scope Changes within the general scope of
this Agreement consisting of additions, deletions, or other revisions. If
Purchaser so desires to request Scope Changes, it shall submit a change request
to Supplier in writing. Within ten (10) Business Days after its receipt of
any such request, Supplier shall submit a detailed proposal to Purchaser
stating (a) the increase or decrease, if any, in the Purchase Price which
would result from such change, and (b) the effect, if any, upon the
Delivery Schedule or Completion Schedule by reason of such proposed change.
Purchaser shall have five (5) days from receipt of Supplier’s detailed proposal
to accept or reject in writing Supplier’s proposal in relation to the requested
change. If Purchaser agrees with Supplier’s proposal, Purchaser and Supplier
shall execute a Change Order reflecting the requested Scope Changes and
proposed adjustments, if any, in the Purchase Price and the Delivery Schedule
or Completion Schedule. In the event Purchaser disagrees with Supplier’s
proposal, Purchaser shall promptly so notify Supplier, following which the
Parties shall negotiate in good faith a solution which is satisfactory to both
Purchaser and Supplier. Should Purchaser fail to respond to Supplier in writing
within the foregoing five (5) day period, Purchaser shall be deemed to
have withdrawn its requested change.


 


8.3         No Change.
Notwithstanding anything to the contrary contained in this Agreement, Supplier
shall not be obligated to proceed with any Scope Changes requested by Purchaser
unless and until a Change Order is executed by the Parties in relation to such
change. Further, Supplier shall not be required to implement a requested Scope
Change by Purchaser if the implementation of such change would, in Supplier’s
reasonable opinion, likely impair Supplier’s ability to achieve any of the
performance guarantees, warranties or covenants set forth in this Agreement,
the OMS Agreement, and/or the Warranty Agreement.


 


8.4         Scope Changes
Caused by a Force Majeure Event. If a Force Majeure Event occurs that
materially adversely affects Supplier’s performance of all or a portion of the
sale and Delivery obligations hereunder or if such a Force Majeure Event causes
any of the Commissioning Work to be temporarily or permanently prevented.
Supplier shall be entitled to a Change Order reflecting such impact of such
Force Majeure Event, including an extension in Supplier’s time for performance
for such delay to the extent Supplier’s performance is actually delayed. In the
case of a Force Majeure Event, Supplier must notify Purchaser of Supplier’s
intent to request a Change Order (the “Notice of Intention”) within thirty (30)
Business Days of the Force Majeure Event. Supplier shall submit to Purchaser a
draft Change Order outlining, with reasonable specificity, the requested Scope
Changes within ten (10) Business Days after the Notice of Intention is
delivered to Purchaser.


 


14














 


8.5       Scope Changes Caused by Events within
the Control of Purchaser. If Purchaser, EPC Contractor or any of Purchaser’s
Contractors causes an event that materially adversely affects Supplier’s
performance of all or a portion of the sale and Delivery obligations hereunder
or if such event causes the Commissioning Work to be temporarily or permanently
prevented, Supplier shall be entitled to a Change Order reflecting such impact
of such event, including (i) an extension in Supplier’s time for
performance for such delay to the extent Supplier’s performance is actually
delayed, and (ii) an increase in the Purchase Price with respect to such
additional cost to the extent such delay is caused solely by Purchaser, EPC
Contractor or any of Purchaser’s Contractors. In the case of such a Purchaser
caused event, Supplier must notify Purchaser of Supplier’s intent to request a
Change Order (the “Notice of Intention”) within thirty (30) Business Days of
the Purchaser caused event. Supplier shall submit to Purchaser a draft Change
Order outlining, with reasonable specificity, the requested Scope Changes
within ten (10) Business Days after the Notice of Intention is delivered
to Purchaser.


 


ARTICLE 9


 


LIMITATION OF
LIABILITY


 


9.1       Supplier
Not Responsible for Purchaser’s Work. Notwithstanding anything to the
contrary set forth herein, Supplier shall not have any responsibility for (a) Project
Site selection, permitting or Turbine siting within the Project Site; (b) the
design, supply or construction of Tower foundations; (c) the assembly,
erection and installation of the Turbines or the SCADA System; (d) the
design, assembly, erection and installation of any other element of the
Project, (e) obtaining rights required by the Project to sell or transmit
its electrical output, or (f) any other element of Purchaser’s Work, all
of which are expressly the responsibility of Purchaser.


 


9.2       Overall
Limitation of Liability. Notwithstanding anything to the contrary contained
in this Agreement, in no event shall Supplier, its parent company, Affiliates
and agents be liable, alone or in the aggregate, to Purchaser for any damages,
claims, demands, suits, causes of action, losses, costs, expenses and/or
liabilities related in any manner to this Agreement, the Warranty Agreement and
the OMS Agreement in excess of an amount equal to ***** percent (*****%) of the
Purchase Price, regardless of whether such liability arises out of breach of
contract, guarantee or warranty, tort, product liability, indemnity,
contribution, strict liability or any other legal theory; provided, however,
the preceding limitation of liability shall not apply to, and no credit shall
be issued against such liability for, (a) Supplier’s indemnity obligations
set forth in Section 13.1 solely as they relate to claims by third
Parties for bodily injury or property damage, or (b) the fraud or willful
misconduct of Supplier.


 


9.3       Consequential
Damages. Notwithstanding anything to the contrary contained in this
Agreement and except as set forth in the last sentence of this Section,
Purchaser and Supplier waive all claims against each other (and against each
other’s parent company, Affiliates, contractors, subcontractors, consultants,
vendors, suppliers and agents) for any consequential, incidental, indirect,
special, exemplary or punitive damages (including, but not limited to, loss of
actual or anticipated profits, revenues or product; loss by reason of shutdown
or non-operation; increased expense of operation, borrowing or financing; loss
of use or productivity; or increased cost of capital), and regardless of
whether any such claim arises out of breach of contract or warranty, tort,
product liability, indemnity, contribution, strict liability or any other legal
theory. Any


 


15

















 


consequential,
incidental, indirect, special, exemplary or punitive damages incurred by
Supplier or Purchaser in relation to a third Party shall, for all purposes of
this Agreement, be deemed consequential, incidental, indirect, special,
exemplary or punitive damages in relation to any claim brought by Supplier or
Purchaser against the other Party to this Agreement. Any liquidated damages
payable by Supplier under this Agreement shall not be deemed consequential,
incidental, indirect, or special damages for purposes of this Agreement.


 


ARTICLE 10


 


TITLE AND RISK OF
LOSS; INSURANCE


 


10.1     Title
to Supply Items. Title to any Supply Item shall transfer to the Purchaser
upon (i) the Delivery of such Supply Item to its Designated Delivery
Location and (ii) Purchaser’s payment of and Supplier’s receipt of, the
applicable Progress Payment.


 


10.2     Risk
of Loss. Supplier shall bear the risk of loss and damage with respect to
any Supply Item (including each individual Major Turbine Component) until
Delivery of such Supply Item to its Designated Delivery Location. In performing
the Commissioning Work, Supplier shall be deemed a contractor of Purchaser
performing the Services on Supply Items then owned by Purchaser. Upon the
Delivery of any Supply Item to its Designated Delivery Location, care, custody
and control of, and risk of loss or damage to, such Supply Item shall thereupon
transfer to the Purchaser.


 


10.3     Insurance.  Supplier and Purchaser shall maintain the
following insurance while this Agreement is in effect:


 


10.3.1  Supplier Insurance.


 


Supplier
shall carry and maintain or cause to be carried and maintained, at all times
during the Term of this Agreement, insurance coverage with limits as set forth
in this Section (the “Supplier Insurance”).


 


Marine Cargo Insurance


 


All property and
interests of every kind and description (including materials, equipment,
machinery and spares) intended for the Project or subsequent operations while
in transit by land, air and/or sea. All Risks of physical loss or damage from a
cause not excluded but including war, strikes, riots and civil commotions and
terrorism while in transit, on a continuous open cover basis. Increased cost of
working - the additional expenditure necessarily and reasonably incurred for
the purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Property


 


At
all times the Supplier’s factory premises, plant, machinery, raw materials and
finished stocks all related to and comprising the Project under a property
insurance in an amount equal to the full replacement value of the above named
items for “all risks” of physical loss or damage including, but not limited to,
coverage for earth movement,


 


16

















 


flood,
windstorm, earthquake, sabotage, terrorism, riots, civil commotion, testing,
boiler and machinery, transit and off-site storage. The policy may contain
separate sub limits and deductibles subject to insurance company underwriting
guidelines. Deductibles under the policy shall not exceed $100,000 per
occurrence, except for deductibles for natural catastrophe peril, which shall
not exceed five percent (5%) of the insured loss.


 


Increased
cost of working - the additional expenditure necessarily and reasonably
incurred for the purpose of avoiding or reducing delay which, without such
expenditure would have taken place.


 


Workers Compensation


 


Coverage
shall comply with any statutory obligation imposed by Workers Compensation,
Occupational Disease Laws, or similar laws, including where applicable, the
United States Longshoremen’s and Harbor Workers’ Act, the Federal Employers’
Liability Act and the Jones Act. Employers’ Liability insurance shall have
limits of not less than $1,000,000 per accident, $1,000,000 disease-policy
limit and $1,000,000 disease-each employee.


 


Commercial General Liability


 


Insurance
providing coverage for bodily injury, property damage and personal/advertising
injury with a combined single limit of not less than $1,000,000 per occurrence
and $2,000,000 aggregate. The policy shall include contractual liability and
any testing operations coverage.


 


a.                    Automobile Liability - Insurance for owned,
non-owned and hired automobiles with a limit of not less than $1,000,000 per
occurrence.


 


b.                    Excess liability - Insurance with a minimum
limit of $10,000,000 per occurrence and annual aggregate.


 


c.                     Evidence and
Scope of Insurance - Supplier shall provide Purchaser with a copy of
insurance original certificates evidencing the insurance coverages required and
shall provide replacement certificates of insurance within five (5) days
of any renewal of the required insurance.


 


All such insurance
policies shall:


 


(i) name
Purchaser for their respective rights and interests in respect of the Project
as additional insured (except in the case of worker’s compensation insurance);


 


(ii) provide
Purchaser with 30 days’ prior written notice of non-renewal, cancellation of,
or significant modification to, any of such policies (except that such notice
period will be 10 days in case of non-payment of premiums); and


 


(iii) the
insurance certificates provided to Purchaser shall indicate that the insurance
policies have been endorsed as noted above. All


 


17

















 


policies shall be
written by one or more insurance companies authorized to do business in USA and
be rated BBB+ or higher by A.M. Best.


 


Term and Modification of Insurance


 


If
the designated coverage, or relatively comparable coverage, are unavailable on
reasonable commercial terms, Supplier will provide Purchaser detailed
information as to the maximum amount of available coverage that it is able to
purchase and will be required to obtain Purchaser’s consent as to the adequacy
of said coverage under the circumstances at the time, which consent shall not
be unreasonably withheld or delayed.


 


10.3.2 Purchaser
Insurance.


 


Purchaser
shall carry and maintain or cause to be carried and maintained, at all times
during the Term of this Agreement, insurance coverage with limits as set forth
in this Section.


 


Builder’s All Risk Insurance


 


At
all times during construction, the Purchaser’s Project will be under a builder’s
all risk insurance in an amount equal to the full replacement value of the
Project for “all risks” of physical loss or damage including, but not limited
to, coverage for earth movement, flood, windstorm, earthquake, sabotage,
terrorism, riots, civil commotion, testing, boiler and machinery, transit and
off-site storage. The policy may contain separate sub limits and deductibles
subject to insurance company underwriting guidelines. Deductibles under the
policy shall not exceed $100,000 per occurrence, except for deductibles for
natural catastrophe peril, which shall not exceed five percent (5%) of the
insured loss


 


Increased
cost of working - the additional expenditure necessarily and reasonably
incurred for the purpose of avoiding or reducing delay which, without such
expenditure would have taken place.


 


Workers Compensation


 


Coverage
shall comply with any statutory obligation imposed by Workers Compensation,
Occupational Disease Laws, or similar laws, including where applicable, the
United States Longshoremen’s and Harbor Workers’ Act, the Federal Employers’
Liability Act and the Jones Act. Employers’ Liability insurance shall have
limits of not less than $1,000,000 per accident, $1,000,000 disease-policy
limit and $1,000,000 disease-each employee.


 


18

















 


Commercial General Liability


 


Insurance
providing coverage for bodily injury, property damage and personal/advertising
injury with a combined single limit of not less than $1,000,000 per occurrence
and $2,000,000 aggregate. The policy shall include contractual liability and
any testing operations coverage.


 


a.    Automobile
Liability - Insurance for owned, non-owned and hired automobiles
with a limit of not less than $1,000,000 per occurrence.


 


b.    Excess
liability - Insurance with a
minimum limit of $10,000,000 per occurrence and annual aggregate.


 


c.    Evidence
and Scope of Insurance


 


Purchaser shall provide
Supplier with a copy of insurance original certificates evidencing the
insurance coverages required and shall provide replacement certificates of
insurance within five (5) days of any renewal of the required insurance.


 


All such insurance policies shall:


 


(i) name Supplier for their respective rights and
interests in respect of the Project as additional insured (except in the case
of worker’s compensation insurance);


 


(ii) provide Supplier with 30 days’ prior written
notice of non-renewal, cancellation of, or significant modification to, any of
such policies (except that such notice period will be 10 days in case of
non-payment of premiums); and


 


(iii) The insurance certificates provided to
Supplier shall indicate that the insurance policies have been endorsed as noted
above. All policies shall be written by one or more insurance companies
authorized to do business in USA and be rated BBB+ or higher by A.M. Best.


 


Term and Modification of Insurance


 


If
the designated coverage, or relatively comparable coverage, are unavailable on
reasonable commercial terms, Purchaser will provide Supplier detailed
information as to the maximum amount of available coverage that it is able to
purchase and will be required to obtain Supplier’s consent as to the adequacy of
said coverage under the circumstances at the time, which consent shall not be
unreasonably withheld or delayed.


 


19

















 


ARTICLE 11


 


REPRESENTATIONS
AND WARRANTIES OF SUPPLIER


 


Supplier
hereby represents and warrants to Purchaser as follows:


 


11.1        Due Organization;
Good Standing. Supplier is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, and qualified to
conduct business in the states where it does business.


 


11.2        Due Authorization.
The execution, delivery and performance of this Agreement by Supplier have been
duly authorized by all necessary corporate action on the part of Supplier and
do not and will not require the consent of any trustee or holder of any
indebtedness or other obligation of Supplier or any other Party to any other
agreement with Supplier.


 


11.3        Execution and
Delivery. This Agreement has been duly executed and delivered by Supplier.
This Agreement constitutes the legal, valid and binding obligation of Supplier,
enforceable against Supplier in accordance with its terms, except to the extent
that its enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the rights of creditors
generally or by principles of equity.


 


11.4        Governmental
Approvals. No governmental authorization, approval, order, license, permit,
franchise or consent, and no registration, declaration or filing with any
Governmental Authority is required on the part of Supplier in connection with
the execution, delivery and performance of this Agreement, except those which
have already been obtained or which Supplier anticipates will be timely
obtained in the ordinary course of performance of this Agreement.


 


11.5       Supply Items;
Services. The Supply Items and the SCADA System to be delivered hereunder
shall be designed and fit for the purpose of generating electric power when
operated in accordance with the Turbine Specifications, the OMS Manual, Prudent
Electrical Industry Practices and Prudent Wind Industry Practices. The Supply
Items and SCADA System shall be new and unused and shall be free from Defects
and free from defects in title. The Services shall be performed in a competent,
diligent manner in accordance with Prudent Wind Industry Practices, Supplier’s
manufacturers’ written requirements and applicable Governmental Requirements.


 


ARTICLE 12


 


REPRESENTATIONS AND WARRANTIES OF
PURCHASER


 


Purchaser
represents and warrants to Supplier as follows:


 


12.1      Due Organization;
Good Standing; Qualified To Do Business. Purchaser is a limited liability
company duly organized, validly existing and in good standing under the laws of
the State of Delaware, and qualified to conduct business in the states where it
does business.


 


20

















 


12.2       Due
Authorization. The execution, delivery and performance of this Agreement by
Purchaser have been duly authorized by all necessary action on the part of
Purchaser in accordance with Purchaser’s organizational documents and do not
and will not require the consent of any trustee or holder of any indebtedness
or other obligation of Purchaser or any other Party to any other agreement with
Purchaser.


 


12.3       Execution
and Delivery. This Agreement has been duly executed and delivered by
Purchaser. This Agreement constitutes the legal, valid and binding obligation
of Purchaser, enforceable against Purchaser in accordance with its terms,
except to the extent that its enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
rights of creditors generally or by principles of equity.


 


12.4       Governmental
Approvals. No governmental authorization, approval, order, license, permit,
franchise or consent, and no registration, declaration or filing with any
Governmental Authority is required on the part of Purchaser in connection with
the execution, delivery and performance of this Agreement, except those which
have already been obtained or which Purchaser anticipates will be timely
obtained in the ordinary course of performance of this Agreement.


 


12.5       Project
Site. On or prior to the date that Supplier is to provide any services
relating to the Project at the Project Site, Purchaser shall have obtained the
right and authority to have such work performed on the Project Site. To the
knowledge of Purchaser, after the completion of reasonable due diligence on the
Project Site, the Project Site is free of all hazardous or dangerous materials
or substances. All information concerning the Project Site and the wind flow
across the Project Site heretofore delivered to Supplier by Purchaser is true,
complete and correct in all material respects.


 


ARTICLE 13


 


MUTUAL INDEMNITY


 


13.1       Mutual
Indemnity. Each of Supplier and Purchaser agree to defend, indemnify and
hold each other, and each other’s lenders, parent companies, Affiliates,
officers, directors, agents and employees, harmless from and against any
claims, losses, damages and liabilities (including, but not limited to,
reasonable attorneys’ fees and court costs, but excluding consequential
damages) on account of any claim by a third Party for bodily injury or property
damage against the indemnified Party to the extent caused by the negligent act
or omission, or willful misconduct of, or breach of this Agreement by, the
indemnifying Party or the indemnifying Party’s employees, contractors,
subcontractors or agents, in connection with the performance of their
respective obligations under this Agreement.


 


ARTICLE 14


 


DEFAULT; CURE; REMEDIES


 


14.1       Default
by Supplier. Supplier shall be in default under this Agreement should any
one or more of the following events or conditions arise or exist:


 


21

















 


(i)     Supplier
becomes insolvent, or generally does not pay its debts as they become due, or
admits in writing its inability to pay its debts, or makes a general assignment
for the benefit of creditors; or


 


(ii)    Insolvency,
receivership, reorganization, or bankruptcy proceedings are commenced by or
against Supplier and, in the case of any such involuntary proceeding, that is
not dismissed or stayed within sixty (60) days after it is commenced; or


 


(iii)   Supplier
fails, for any reason, other than failure of Purchaser to make payments to
Supplier when obligated in accordance with this Agreement, to make any
undisputed payments required to be made by Supplier to Purchaser, which failure
continues for ten (10) Business Days after notice of such non-payment; or


 


(iv)    Supplier
is in material default of any term or provision of this Agreement or has
materially failed to perform its obligations under this Agreement, and such
breach or failure continues for thirty (30) Business Days following receipt of
written notice from Purchaser to cure such breach or failure; provided,
however, if such failure cannot with due diligence be remedied by Supplier
within such thirty (30) Business Days period, and Supplier shall have
diligently prosecuted the remedying of such failure within such thirty (30) Business
Days, such period shall be extended by such additional time period as may be
reasonably required by Supplier to cure such failure.


 


14.2       Purchaser’s
Remedies. In the event Supplier is in default pursuant to Section 14.1,
and said default is not timely cured within the time periods set forth above,
Purchaser, in addition to those rights and remedies that may be available to
Purchaser at law or in equity, and subject to Section 9.2 of this
Agreement, shall have the right to terminate this Agreement by written notice
to Supplier; provided however, that amounts applicable to Supply Items
delivered or services performed by Supplier through the date of termination of
this Agreement shall be paid by Purchaser to Supplier.


 


14.3     Default
by Purchaser. Purchaser shall be in default under this Agreement should any
one or more of the following events or conditions arise or exist:


 


(i)      Purchaser
or Guarantor becomes insolvent, or generally does not pay its debts as they
become due, or admits in writing its inability to pay its debts, or makes a
general assignment for the benefit of creditors; or


 


(ii)     Insolvency,
receivership, reorganization or bankruptcy proceedings are commenced by or
against Purchaser or Guarantor and, in the case of any such involuntary proceeding,
that is not dismissed or stayed within sixty (60) days after it is commenced;
or


 


(iii)    Purchaser
fails to timely pay to Supplier any required payment under this Agreement when
due, including failure to timely provide any Down Payment or any Progress
Payment, which failure continues for ten (10) days after written notice of
failure to make payment has been received by Purchaser from Supplier; or


 


22

















 


(iv)    Purchaser
fails to perform any material term or provision of this Agreement, including
failure to timely provide the Guaranty to Supplier, and such failure continues
for thirty (30) Business Days following receipt of written notice from Supplier
to cure such failure; provided, however, if such failure cannot with due
diligence be remedied by Purchaser within such thirty (30) Business Day period,
and Purchaser shall have diligently prosecuted the remedying of such failure
within such thirty (30) Business Days, such period shall be extended by such additional
time period as may be reasonably required by Purchaser to cure such failure; or


 


(v)     The
revocation or other termination of the Guaranty by Guarantor, or the breach by
Guarantor of any material term or provision of the Guaranty, including any payment
obligation thereunder, which breach continues for a period often (10) days
after written notice of such breach has been received by Guarantor from
Supplier.


 


14.4         Supplier’s Remedies.
In the event that Purchaser is in default pursuant to Section 14.3,
and said default is not timely cured within the time periods set forth above,
Supplier, in lieu of any rights and remedies that may be available to Supplier
at law or in equity, shall have the right to terminate this Agreement by
written notice to Purchaser, which termination shall be effective upon delivery
of Supplier’s notice to Purchaser. Within three (3) Business Days of the
effective date of such termination, Purchaser shall pay to Supplier the
liquidated damages set forth on the termination schedule attached hereto as
Exhibit G (“Termination Schedule”), which shall constitute Supplier’s
exclusive remedy, and Supplier shall have no right to damages or compensation
for such termination other than payment of the liquidated damages set forth on
the Termination Schedule.


 


14.5         Cancellation Due to
a Force Majeure Event. If Supplier is entirely prevented from performing
its obligations hereunder for a period of one-hundred eighty (180) consecutive
days as a result of the occurrence of a Force Majeure Event suffered by
Supplier, then Supplier may cancel, without additional liability, any then
remaining unperformed portion of this Agreement, upon not less than thirty (30)
Business Days’ prior written notice to the Purchaser; provided, however, that
nothing in this Section 14.5 shall relieve or excuse Supplier from
its obligations under Article 7 of this Agreement in respect of the
occurrence of a Force Majeure Event or relieve either Party from any payment
obligation that has accrued as of the date of cancellation or prior thereto;
provided further, however, that any payment obligations of Purchaser shall be
reduced by the amount of funds received by Supplier, if any, in connection with
the resale of any Turbines or Turbine components sold that are applicable to
such payment obligations of Purchaser, and, if following such reduction,
Purchaser is owed a refund of some portion of the Purchase Price from Supplier,
Supplier shall refund to Purchaser the applicable amount of Purchase Price
previously paid to Supplier within thirty (30) days of such termination.


 


14.6         Termination for
Convenience. The Purchaser shall have the right to terminate this Agreement
for convenience with respect to any Turbine until title to such Turbine has
passed to Purchaser. Such termination shall be effective upon the later to
occur of (i) delivery to Supplier of written notice of termination and (ii) receipt
by Supplier of liquidated damages in the amount on a per Turbine basis with
respect to such Turbine in accordance with the Termination Schedule attached to
this Agreement as Exhibit G.


 


23

















 


14.7         Surviving
Obligations. Cancellation or expiration of all or any portion of this
Agreement (a) shall not relieve Purchaser of its obligations with respect
to the confidentiality of Supplier’s proprietary information as set forth in Section 4.5
of this Agreement, or either Party of its confidentiality obligations as set
forth in Section 16.9 of this Agreement, (b) shall not relieve
either Party of any obligation hereunder which expressly or by implication
survives termination hereof, and (c) except as otherwise provided in any
provision of this Agreement expressly limiting the liability of either Party,
shall not relieve either Purchaser or Supplier of any obligations or
liabilities for loss or damage to the other Party arising out of or caused by
acts or omissions of such Party prior to the effectiveness of such termination
or arising out of such termination, and shall not relieve Supplier of its obligations
as to portions of the items supplied or other services hereunder already
supplied or performed or of obligations assumed by Supplier prior to the date
of termination. This Article shall survive the termination or expiration
of this Agreement.


 


ARTICLE 15


 


DISPUTE RESOLUTION


 


15.1       Procedure. In the event a dispute,
controversy or claim (herein, a “dispute”) arises between Purchaser and
Supplier relating to this Agreement, the aggrieved Party shall promptly provide
written notification of the dispute to the other Party within ten (10) days
after such dispute arises and the Parties shall resolve such dispute as
provided herein:


 


15.1.1         Executives
Meeting. A meeting shall be held between the Parties, attended by
representatives of the Parties with decision-making authority regarding the
dispute, to attempt in good faith to negotiate a resolution of the dispute.
Such meeting shall be held in Carpinteria, California within thirty (30) days
after a notice of dispute has been delivered under Section 15.1 above.


 


15.1.2         Independent
Engineer’s Decision. If the dispute involves a technical issue, within ten (10) days
after such meeting, the Parties have not resolved the dispute, either Party
shall submit the dispute to the Independent Engineer for a non-binding
determination, together with such information in support of their position as
may be relevant, which information will simultaneously be sent to the other
Party. The Independent Engineer may hold separate meetings with each Party or
call a joint meeting of the Parties, to be held in Carpinteria, California. The
Independent Engineer shall, within thirty (30) days after such request for a
determination, issue a non-binding decision. Any Party which does not wish to
comply with such decision shall promptly provide written notification of its
intention to the other Party within five (5) days of such decision. The
Parties shall meet in Chicago, Illinois within twenty (20) days of such notice
to attempt, in good faith, to negotiate a final resolution to the dispute. Any
Party which does not wish to comply with such decision shall within ten (10) days
after the date of such meeting submit the dispute to arbitration within twenty
(20) days after the date of such decision to arbitration in accordance with Section 15.1.3
below. The Parties shall share equally the costs of the Independent Engineer.


 


24














 


15.1.3                   Arbitration.


 


(a)                      If the Parties are not successful in
resolving a dispute, controversy or claim pursuant to Sections 15.1.1
and 15.1.2. above, then such dispute shall be resolved through binding
arbitration to take place in Chicago, Illinois. The Parties agree to conduct
all arbitration proceedings in accordance with the Commercial Arbitration Rules of
the American Arbitration Association. This Section 15.1.3 is
governed by the Federal Arbitration Act.


 


(b)                     A Party desiring to submit to arbitration
any such dispute, controversy or claim shall furnish its demand for arbitration
in writing to the other Party or Parties thereto, which demand shall contain a
brief statement of the matter in controversy, as well as a list containing the
names of three (3) suggested arbitrators from the list of arbitrators
maintained by the American Arbitration Association (the “AAA List”) from which
list, or from other sources, all of the Parties shall choose one (1) mutually
acceptable arbitrator. If the Parties are unable to agree upon the identity of
a single arbitrator, within ten (10) days from the receipt of such demand,
the Purchaser and the Supplier shall each (collectively, the “Arbitrating
Parties”), within a period of five (5) additional days, name from the
AAA List one (1) arbitrator by written notice to the other Arbitrating
Party or Parties. Within ten (10) days after this notice, the two (2) arbitrators
so named shall choose a third arbitrator. If any Arbitrating Party fails to
name an arbitrator within the specified five (5) day period or if the two
arbitrators chosen by the Arbitrating Parties fail to select a third arbitrator
within the ten (10) day period, then either Arbitrating Party, on behalf
of and on notice to the other Arbitrating Party or Parties, may request
appointment by the American Arbitration Association in accordance with its rules then
prevailing of the required additional arbitrator or arbitrators so that there
shall be a panel of three (3) arbitrators. If the American Arbitration
Association should fail to appoint the necessary arbitrator or arbitrators
within fifteen (15) days after such request is made, then either Arbitrating
Party may apply, on notice to the other Arbitrating Party or Parties, to a
court of competent jurisdiction for the appointment of such necessary
additional arbitrators. Each of the arbitrator or arbitrators chosen or
appointed pursuant to this Section 15.1.3(b) shall be a person
having at least ten (10) years experience in the United States in the
legal profession and shall not be a past or present officer, director or
employee of, or have any material interest in, any Arbitrating Party or any
Affiliate of an Arbitrating Party. All discovery, including the right to take
depositions and interrogatories, shall be permitted in the time and manner
provided by the then applicable Federal Rules of Civil Procedure. The
Arbitrating Parties shall be entitled to reasonable discovery prior to the
arbitration hearing, and the arbitrator or arbitrators, as the case may be,
shall have the power upon application of any Arbitrating Party to make all
appropriate orders for discovery from the other Arbitrating Party, including
discovery of documents, responses to interrogatories, and depositions. The
scope, time and manner of discovery, including all document discovery, are to
be in accordance with the U.S. Federal Rules of Civil Procedure.
Notwithstanding the foregoing, discovery allowed each of the Arbitrating
Parties shall not exceed: (i) five (5) party depositions; (ii) three
(3) nonparty depositions; (iii) three (3) depositions of any
experts selected to give opinions in the arbitration (as well as the production
of any documents relied upon by such experts); and (iv) fifteen (15)
interrogatories (with each subpart counted as a separate interrogatory).
Discovery shall not include requests for admissions. No deposition shall last
more than two (2) days in length. Further, all discovery must, without
exception, be completed within one hundred twenty (120) days from the date the


 


25

















 


arbitration panel
is appointed. Any documents that are not produced to the other Arbitrating
Party prior to the termination of this 120-day discovery period may not be
offered into evidence at the arbitration hearing unless such production shall
not prejudice the non-producing Arbitrating Party as determined by the
arbitrator or arbitrators, as the case may be. Likewise, any witnesses who have
not been produced for deposition, despite a request from the other side, may
not testify or submit affidavits at the arbitration hearing.


 


(c)                        The arbitrator or arbitrators, as the
case may be, shall render his, her or their decision, in the latter case upon
the concurrence of at least two (2) of their number, as soon as possible
but no later than thirty (30) days after the conclusion of any hearings before
such arbitrator or arbitrators, as the case may be, unless such 30-day period
is extended by the arbitrator or arbitrators, as the case may be. The decision
and award shall in either case be in writing and counterpart copies of such
decision shall be delivered to each of the Arbitrating Parties. Such decision
shall be based solely upon the written arguments and contentions, evidence and
legal authorities, submitted by each Arbitrating Party. In rendering such
decision and award, the arbitrator shall not add to, subtract from or otherwise
modify the provisions of this Agreement. Any award rendered shall be final and
conclusive upon the parties and a judgment on any such award may be entered in
any court having jurisdiction, state or federal, having jurisdiction. No
arbitration proceeding shall be commenced after the date when institution of
legal or equitable proceedings based upon such subject matter would be barred
by the applicable statute of limitations. Notwithstanding anything to the
contrary contained in this section or elsewhere in this Agreement, provisional
injunctive or other provisional equitable relief may be sought by the parties
without first submitting the subject dispute to arbitration so long as
injunctive relief is otherwise warranted by applicable law.


 


15.2               Qualifications of Arbitrators: Expenses.


 


(a)                        The arbitrators in the arbitration
proceeding provided for in this Article 15 shall be individuals
experienced in the energy construction industry and competent to pass on the
matter presented for arbitration.


 


(b)                       Supplier, on the one hand, and Purchaser,
on the other, shall share equally the compensation and expenses of the
arbitrators as well as all fees imposed by the AAA. Supplier and Purchaser
shall be responsible for their own costs and legal fees, if any.
Notwithstanding the foregoing, a majority of the arbitrators shall be empowered
to award the prevailing Party its costs, expenses and/or legal fees.


 


15.3               Performance During Dispute. While any controversy, dispute or claim
arising out of or relating to this Agreement is pending, Purchaser and Supplier
shall continue to perform their obligations hereunder notwithstanding such
controversy, dispute or claim.


 


15.4               Consolidation. No arbitration arising under this
Agreement shall include, by consolidation, joinder or any other manner, any
person or entity not a Party to this Agreement, unless (a) such person or
entity is substantially involved in a common question of fact or law, (b) the
presence of such person or entity is required if complete relief is to be
accorded in the arbitration, and (c) such person or entity has consented
to such inclusion.


 


26

















 


15.5               Language. All arbitration proceedings shall be conducted in
the English language.


 


ARTICLE 16


 


GENERAL PROVISIONS


 


16.1               Waiver. No delay or omission by the Parties hereto in
exercising any right or remedy provided for herein shall constitute a waiver of
such right or remedy nor shall it be construed as a bar to or waiver of any
such right or remedy on any future occasion.


 


16.2               Successors and Assigns. This Agreement shall be binding upon
and shall inure to the benefit of the successors and permitted assigns of
Supplier and Purchaser. Except as set forth herein, neither Supplier nor
Purchaser may assign, convey or transfer this Agreement, in whole or in part,
except upon the prior written consent of the other Party hereto, which consent
shall not be unreasonably withheld, and any such purported transfer or
assignment shall be null and void. Notwithstanding any permitted assignment
hereunder, the assignor shall remain liable to the other Party for all duties
and responsibilities hereunder unless affirmatively recited by the other Party.


 


16.3               Permitted Assignments. Notwithstanding Section 16.2
above, (i) either Party may transfer or assign its rights, benefits and
obligations under this Agreement to an Affiliate; provided, that if requested
by Purchaser, Supplier shall execute and deliver a guaranty of the performance
hereunder by such an assignee, (ii) Purchaser may assign its rights,
benefits and obligations under this Agreement to any purchaser of the Project;
provided, that Purchaser may not transfer or assign this Agreement in whole or
in part to a wind turbine design or manufacturing competitor of Supplier
without the prior written consent of Supplier, which consent may be withheld in
Supplier’s sole discretion and which may be conditioned upon the creditworthiness
of the purchaser, (iii) Supplier is authorized to subcontract any portion
of its duties under this Agreement to a third party or to delegate its
obligations hereunder, in the ordinary course of its business, without reducing
the scope of Supplier’s undertakings, obligations, and commitments to
Purchaser, provided that Supplier agrees that it will not use any supplier for
any Major Turbine Components not listed on Exhibit H without
Purchaser’s advance written consent, such consent not to be unreasonably
withheld, conditioned or delayed, and (iv) a Party, without the consent of
the other Party, may assign its interest in this Agreement to a lender,
collateral trustee, security trustee or similar entity as collateral security
for any financing entered into by the assigning Party, including a lease
financing. The non- assigning Party shall, upon fifteen (15) days’ prior
written request from the assigning Party, execute a consent containing
customary terms and conditions, to any such collateral assignment Further,
notwithstanding Section 16.2 above, Purchaser shall have the right
to assign no less than all of its rights, duties and obligations under the
Turbine Supply Documents to any third party, subject to, and conditioned upon,
the prior written consent of Supplier, which shall not be unreasonably
withheld, conditioned, or delayed; provided however that any such assignment is
conditioned upon the receipt of a guarantee for the benefit of Supplier of the
performance of the contract obligations, including payment security, in a form
acceptable to Supplier, in its sole and absolute discretion. Any such
assignment to a third party also shall be subject to the following: (i) prior
to the effectiveness of such assignment, the third party assignee shall agree
to revisions to the Turbine Supply Documents as determined by Supplier to be
reasonably necessary, to effect the purchase and installation of the Turbines
by the third party assignee at a project site to be determined between Supplier
and any such third party assignee, (ii) the third party assignee shall
assume all of the duties, obligations,


 


27

















 


restrictions and
covenants of Purchaser under the Turbine Supply Documents, as revised, (iii) any
monies or other consideration received by, or otherwise payable to, Purchaser
from the third party assignee in connection with such assignment, in excess of
the Down Payment and any Progress Payments actually paid by Purchaser to
Supplier, other than the reasonable actual documented expenses incurred by
Purchaser in connection with the assignment of the Turbine Supply Documents to
the third party, shall be paid to Supplier and (iv) Purchaser shall pay to
Supplier all of Supplier’s costs associated with such assignment from Purchaser
to the third party assignee, including but not limited to all of Supplier’s
costs (including reasonable legal fees) incurred in connection with the
revision of the Turbine Supply Documents, within thirty (30) days of receipt of
an applicable invoice from Supplier.


 


16.4               Notices.


 


(a)                        Any notice required or authorized to be
given hereunder or any other communications between the Parties provided for
under the terms of this Agreement shall be in writing (unless otherwise
provided) and shall be served personally or by reputable express courier
service or by facsimile transmission addressed to the relevant Party at the
address stated below or at any other address notified by that Party to the
other as its address for service. Any notice so given personally shall be
deemed to have been served on delivery, any notice so given by express courier
service shall be deemed to have been served two (2) Business Days after
the same shall have been delivered to the relevant courier, and any notice so
given by facsimile transmission shall be deemed to have been served on
dispatch. As proof of such service it shall be sufficient to produce a receipt
showing personal service, the receipt of a reputable courier company showing
the correct address of the addressee or an activity report of the sender’s
facsimile machine showing the correct facsimile number of the Party on whom
notice is served and the correct number of pages transmitted.


 


(b)                       The Parties’ addresses for service are:


 


To Purchaser:               UPC Wind Acquisition V, LLC


c/o UPC Wind Management, LLC


85 Wells Ave., Suite 305


Newton, MA 02459


Attn:                                                                                            General Counsel


Facsimile:     (617) 964-3342


Telephone:
   (617) 964 3340


 


To Supplier:                  Clipper Turbine Works, Inc.


6305 Carpinteria Avenue, Suite 300


Carpinteria, California 93013


Attn:                General Counsel


Facsimile:
    805.899.1115


Telephone:
   805.690.3275


 


28

















 


with a copy to:                                                   Chadbourne & Parke LLP


300 South Grand Avenue, Suite 3300


Los Angeles, CA 90071


Attn:                    Edward
W. Zaelke


Facsimile:    213.622.9865


Telephone:   213.892.1000


 


16.5               Governing Law. This Agreement and all matters arising
hereunder or in connection herewith shall be governed by and construed in
accordance with the laws of the State of New York, without regard to conflicts
of law principles.


 


16.6               Amendments. This Agreement may be modified or amended only by an
instrument in writing signed by the Parties hereto.


 


16.7               Attachments Incorporated. The preamble and recitals of this
Agreement, and the Exhibits attached hereto, are hereby incorporated into and
made a part of this Agreement.


 


16.8               Entire Agreement. The terms and conditions set forth
herein, together with those set forth on all Exhibits attached hereto,
constitute the complete statement of the agreement between Supplier and
Purchaser relating to the subject matter hereof. No prior statement or
correspondence shall modify or affect the terms and conditions hereof. Prior
representations, promises, warranties or statements by Supplier or Purchaser, or
by any agent or employee of Supplier or Purchaser, that differ in any way from
the terms and conditions hereof shall be given no effect.


 


16.9               Confidentiality. Each Party agrees to keep the terms and
provisions of this Agreement and all materials and information that each
receives pursuant hereto or in connection herewith or in connection with the
Project in the strictest confidence and not to disclose any of the foregoing to
any party other than the respective lenders, investors, attorneys, accountants,
Affiliates, officers and directors of each Party or as such Party may be
required by law, court order or in any litigation to disclose. This Section 16.9
shall survive the termination of this Agreement. Notwithstanding the foregoing,
Supplier shall be entitled to announce by press release or other means that it
has agreed to furnish the Turbines for the Project. The Parties agree that,
with respect to press releases concerning the Project, they will endeavor to
cooperate and share information with one another so that the Parties are
identified, to the extent practicable in press releases regarding the Project.
Supplier and Purchaser will each provide copies of all press releases issued
regarding the Project to the other. Furthermore, the restrictions of this Section 16.9
shall not prohibit or restrict Supplier from using or disclosing the
availability and performance data from the Project in connection with its
sales, maintenance and other internal purposes; provided, however, that no
specific reference shall be made to the Project in connection with the
disclosure of such data.


 


16.10         Counterparts. This Agreement may be executed by the
Parties in one or more counterparts, all of which taken together, shall
constitute one and the same instrument. The exchange of copies of this
Agreement and of signature pages by facsimile transmission shall
constitute effective execution and delivery of this Agreement as to the Parties
and may be used in lieu of the original Agreement for all purposes (and such
signatures of the parties transmitted by facsimile shall be deemed to be their
original signatures for all purposes).


 


29

















 


16.11         English
Language Documents.
Any document, manual, certificate or notice required or authorized to be given
hereunder for the operation of the Project shall be provided in the English
language.


 


16.12         Severability. In case any provision in this Agreement
is held to be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not be affected.


 


16.13         Headings. The headings and captions used in this
Agreement are inserted for reference and convenience only and the same shall
not limit or construe the sections, articles or paragraphs to which they apply
or otherwise affect the interpretation thereof.


 


16.14         Agreement
Revisions.
Following the execution of this Agreement by the Parties, if either Party
requests a change to the Agreement in order to (i) correct any
inconsistency contained within the Agreement or among the Turbine Supply
Documents or (ii) clarify any ambiguities in the Agreement to reflect the
intent of the Parties, then the Parties agree to work in good faith to amend
the language of the Agreement to conform to any such requested change.


 


30

















 


IN
WITNESS WHEREOF, this Agreement has been executed and delivered by the duly
authorized representatives of Purchaser and Supplier as of the date first
written above.


 


 


	
   

  	
  CLIPPER TURBINE WORKS,
  INC.,

  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
            
  /s/ Robert Gates

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
            
  Robert Gates

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
            
  Sr. Vice Pres

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  UPC WIND ACQUISITION V,
  LLC,

  a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
            
  /s/ Paul Gaynor

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
            
  Paul Gaynor

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
            
  President

  
				



 


[Signature
Page to Turbine

Supply Agreement]


 

















 


APPENDIX
I


 


DEFINITIONS


 


“Additional
Cost Event” means (a) an Emergency, (b) a Force Majeure Event or an
Operating Force Majeure Event, (c) damage caused by an act or omission of
the Owner or a third party (other than an Affiliate, Subcontractor or other
agents or designees of the Operator) which is required to be repaired in order
for the Turbines to be operated and maintained in accordance with the standard
set forth in this Agreement, or (d) the receipt by the Operator of a
written request from the Owner for the Operator’s performance of Additional OMS
Services.


 


“Affiliate”
means, with respect to any Party, any Person or entity which, directly or
indirectly, is in control of, or is controlled by, or is under common control
with such Party or any Subsidiary of such Party. For the purposes of this
definition, control of a Party shall mean the power, direct or indirect, (a) to
vote in excess of fifty percent (50%) or more of the securities having ordinary
voting power for the election of directors, (b) to direct or cause the
direction of the management and policies of such Party, whether by contract or
otherwise.


 


“After
Tax Value” means an amount equal to the sum of any payment, credit or other
original amount (the “Original Amount”) plus an amount that will cause the
recipient to retain a sum equal to the Original Amount after federal income
taxes at the highest marginal rate are or would be imposed on the After Tax
Value.


 


“Agreement”
means the Supply Agreement, the Warranty Agreement or the OMS Agreement, as the
context requires.


 


“Ancillary
Parts and Equipment” means those ancillary parts, materials and equipment
listed in Exhibit A to the Supply Agreement, which are typically
required, together with the Major Turbine Components, to form a Turbine.


 


“Annual
Windsystem Availability” or “AWA” has the meaning given in Exhibit A
to the Warranty Agreement.


 


“Availability”
has the meaning given in Exhibit A to the Warranty Agreement.


 


“Available
Hours” has the meaning given in Exhibit A to the Warranty
Agreement.


 


“Average
Nominal Measured Energy” or “ANME” has the meaning given in Exhibit C
to the Warranty Agreement.


 


“AWA
Period Revenue” shall have the meaning given in Exhibit A to the
Warranty Agreement.


 


“Base
Hours” has the meaning given in Exhibit A to the Warranty
Agreement.


 


“Business
Days” means Monday through Friday of each week, except holidays in which
commercial banks in the United States are required or permitted to close.


 


I-1

















 


“Change
in Law” means, after the date hereof, the enactment, modification or repeal or
any Governmental Requirements, or any change in the interpretation of any
Governmental Requirements by any Governmental Authority or court of law, that
materially affects Supplier’s schedule for performing any of its obligations
hereunder; provided a change in applicable tax law shall not constitute a “Change
in Law” hereunder.


 


“Commencement
Date” means the date upon which the Supplier shall have timely received the
entirety of (a) the Down Payment, (b) the Parent Guaranty, and such
other fees as may be applicable.


 


“Commissioning”
or “Commissioning Work” means the installation inspection, field commissioning
and acceptance testing, and controller power-up test, and start-up work to be
conducted by Supplier under the Supply Agreement, for each Turbine, in
accordance with the Commissioning and Start-Up Procedures.


 


“Commissioning
and Start-Up Procedures” means the field commissioning and acceptable testing
and start-up test and inspection procedures set forth on Exhibit O
of the Supply Agreement.


 


“Commissioning
Certificate” means a certificate issued by Supplier to Purchaser, in the form
attached as Exhibit M to the Supply Agreement, following completion
of Commissioning of each Turbine.


 


“Complete”
or “Completion” shall mean, with respect to any Turbine, that (i) all
Turbine Components have been delivered to the Project Site and installed in
accordance with the Installation Procedures, (ii) Purchaser has completed
the necessary terminations and connections of the collection lines and the
SCADA communication lines into the controller in the base of the Turbine Tower
using the collection lines and SCADA communication lines supplied by Purchaser,
and (iii) the Turbine has been Commissioned.


 


“Completion
Schedule” shall mean the schedule for the completion by Supplier and Purchaser,
as applicable, of Turbine installation and Commissioning as set forth in Exhibit T
to the Supply Agreement.


 


“CPI”
shall mean the Consumer Price Index for the United States City Average, All
Urban Consumers (CPI-U), All Items (base index year 1982-1984=100), as
published by the United States Department of Labor, Bureau of Labor Statistics.


 


“Default
Rate” means a per annum rate of interest equal to the lesser of (a) the
maximum rate permitted by law and (b) twelve percent (12%) per annum.


 


“Defect”
means a defect in any part or component of a Turbine covered under the Standard
Warranty that causes such part or component to fail during the Warranty Period.
A component is deemed to have “failed” only when it either (i) breaks, or (ii) ceases
to perform the operation for which it was designed, intended or installed;
provided, however, that normal wear and tear shall not constitute failure.


 


I-2














 


“Delivery”
or “Delivered” means when a Supply Item is made available by Supplier for
pickup by Purchaser at its respective Designated Delivery Location, provided
however, that Purchaser may not take custody and control of the said Supply
Item until the applicable Progress Payment has been made by Purchaser and
received by Supplier.


 


“Delivery
Schedule” shall mean the schedule as set forth in Exhibit L to the
Supply Agreement for the Delivery by Supplier of the Supply Items to the
Designated Delivery Locations.


 


“Designated
Delivery Location” shall have the meaning given in Section 5.4 of
the Supply Agreement.


 


“Down
Payment” shall have the meaning given in Section 3.1 of the Supply
Agreement.


 


“Down
Payment Date” shall have the meaning given in Section 3.1 of the
Supply Agreement.


 


“Effective
Date” shall mean the date of the Supply Agreement.


 


“Electrical
Infrastructure” means the pad mounted transformers, feeder lines, high voltage
feeder lines, switches and all other related facilities owned by Purchaser through
which the electrical power generated by the Turbine is transferred from the
point of connection at the Turbine Controller to the Interconnection
Facilities.


 


“Emergency”
means an event occurring at the Project Site, or the Maintenance and Spare Parts
Facility or any adjoining property that poses actual or imminent risk of
serious personal injury or material physical damage to the Project, or parts
thereof, requiring immediate preventative or remedial action.


 


“Environmental
Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees,
judgments, injunctions, notices or binding agreements issued, promulgated or
entered into by any Governmental Authority, relating in any way to the
environment, preservation or reclamation of natural resources, the management,
environmental release or threatened environmental release of any Hazardous
Substance or to health and safety matters, including the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§
9601 et seq.; the Resource Conservation and Recovery Act, as the same may be
amended from time to time, 42 U.S.C. §§ 6901 et seq.; the Federal Water
Pollution Control Act, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control
Act, 15 U.S.C. §§ 2601 et seq.; the Clean Air Act, 42 U.S.C. §§ 7401 et seq.;
the Safe Drinking Water Act, 42 U.S.C. §§ 3803 et seq.; the Oil Pollution Act
of 1990,33 U.S.C. §§ 2701 et seq.; the Emergency Planning and the Community
Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the Hazardous Material
Transportation Act, 49 U.S.C. §§ 1801 et seq. and the Occupational Safety and
Health Act, 29 U.S.C. §§ 651 et seq.; and any state and local counterparts or
equivalents, in each case as amended from time to time.


 


“EPC
Contract” means that certain agreement(s), if any, by and between Purchaser and
EPC Contractors), for the erection of the Turbine and the design, supply,
construction, installation and commissioning of (i) crane pads, laydown
areas, temporary construction roads


 


I-3

















 


and storage yards,
(ii) permanent roads, Turbine foundations and transformer foundations, (iii) the
Electrical Infrastructure, (iv) the SCADA System, including communication
lines, (v) any control and operation and maintenance buildings and
facilities (vi) and other civil and electrical elements and other work for
the Project.


 


“EPC Contractor(s)” means such person or entity
selected by Purchaser as principal contractor for performing work under the EPC
Contract.


 


“Escrow Agent” means such party as agreed upon by Supplier and
Purchaser to serve as the escrow agent.


 


“FAA”
means the Federal Aviation Administration.


 


“Final Assembly Work” shall mean the final assembly
work for the completion of Turbine component assembly, as set forth in Exhibit P
to the Supply Agreement, prior to the installation of the Turbine.


 


“Financing Documents” means the financing agreement, by and among the
Purchaser or one of its Affiliates, and the lenders or other financial
institutions from time to time party thereto by which the Purchaser or one of
its Affiliates intends to raise capital to finance the construction of the
Project.


 


“Force
Majeure Event” means any event beyond the reasonable control of the Party
affected which materially affects its performance hereunder, including, without
limitation: war, hostilities, insurrection, riot, vandalism or other public
disorder or civil disturbance; terrorism; perils at sea, acts of God, fire,
hurricanes, tornadoes (including tornado watches or warnings for the Project
Site issued by the National Weather Service), mudslides, hail, earthquakes,
lightning, other extreme weather conditions, and, during Commissioning or
repairs, wind in excess of fifteen (15) meters per second or that would make
necessary lifting unsafe, but only for so long as such winds persist;
expropriation or confiscation; strikes, lockouts or other labor disputes;
perils at sea; or unforeseen delays in transportation or shipping, including
with respect to roadways, harbors, ports and other transportation and shipping
infrastructure; any Change in Law; or damage to any part of Supplier’s
factories or assembly plants, or the factories or assembly plants of its
Subcontractors. Force Majeure Events shall include those Force Majeure Events
experienced by any of Supplier’s Subcontractors in circumstances where Supplier
is not able to reasonably reallocate the work of that Subcontractor to an
alternative vendor.


 


“Germanischer
Lloyd” means Germanischer Lloyd Windenergie GMBH.


 


“Germanischer Lloyd Turbine Certification”, “GL
Certificate” or “GL Certified” means a certification of the Turbine to be
issued by Germanischer Lloyd.


 


“Governmental Authority” means the government or any
federal, state, municipal or other political subdivision in which the Project
is located, or any other governmental or political subdivision thereof
exercising jurisdiction over the Project or, with respect to their rights and
obligations hereunder or, with respect to the Project, the Parties, including
all agencies and instrumentalities of such governments and political
subdivisions.


 


I-4

















 


“Governmental Requirements” means all laws, statutes,
codes, rules, regulations, orders, and decrees of any Governmental Authority in
effect on the date hereof, including all authorizations, consents,
registrations, exemptions, Permits and licenses with or from any Governmental
Authority, applicable to the Project or, with respect to their rights and
obligations hereunder or with respect to the Project, the Parties.


 


“Guarantor” means UPC Wind Partners, LLC as guarantor
under that certain Guaranty to be entered into between Supplier and UPC Wind
Partners, LLC.


 


“Hazardous Substances” means all explosive or
radioactive substances or wastes and all hazardous or toxic substances, wastes
or other pollutants, including petroleum or petroleum distillates, asbestos or
asbestos containing materials, polychlorinated biphenyls, radon gas, infectious
or medical wastes and all other substances or wastes of any nature regulated
pursuant to any Environmental Law.


 


“Independent Engineer” means Garrad Hassan,
Germanischer Lloyd, the National Renewable Energy Laboratory, or Global Energy
Concepts, or such other independent engineer as mutually agreed.


 


“Installation Procedures” means the procedures for the
proper (i) assembly, erection and installation of the Towers on the
Turbine foundations supplied by Purchaser, (ii) grouting of the Turbines
to the Tower foundations and tightening of all bolts using the appropriate
torque; (iii) assembly, erection and installation of the Turbine Nacelles
and Turbine Blades upon the Towers as specified in the Turbine Specifications,
Prudent Wind Industry Practices and Prudent Electrical Industry Practices; (iv) installation
and testing of the Turbine electrical cables, communication cables, and control
panels within the Turbine, and (v) connection of the cables from each
Turbine Nacelle to the main circuit breaker within the ground controllers, all
in accordance with the Turbine Installation Manual.


 


“Installation Work” means the work required pursuant
to the Installation Procedures to assemble, erect and install the Turbines.


 


“Intellectual Property Rights” means and refers to all
patents, copyrights, trademarks, service marks, trade secrets and all similar
and related intellectual property rights protected under any statutes, laws,
codes, rules or regulations and any licenses and other rights obtained by
Supplier or its Affiliates from third parties.


 


“Interconnection Facilities” means all the land
rights, materials, equipment and facilities to be installed by Purchaser for
the purpose of interconnecting the Turbines to the Project’s substation so as
to permit the delivery of electrical energy generated by the Turbines to the
interconnection point within the Project’s substation, which shall include, but
shall not be limited to, electrical interconnection, switching, metering,
relaying, communication and safety equipment.


 


“Lenders”
shall mean those lenders providing financing for the Project.


 


“Maintenance and Spare Parts Facility” means the
location from which Operator will perform the OMS Services.


 


I-5

















 


“Major
Turbine Components” means the Turbine Nacelle, Turbine Controller, Turbine hub,
Turbine Blades and Tower for each Turbine, as such items are more particularly
described in the Turbine Specifications.


 


*****


 


“Nominal
Expected Energy” or “NEE” has the meaning given in Exhibit C of the
Warranty Agreement.


 


“Nominal
Measured Energy” or “NME” has the meaning given in Exhibit C of the
Warranty Agreement.


 


“OMS
Agreement” means that certain Operation and Maintenance Service Agreement,
executed or to be executed between Supplier (or an Affiliate of Supplier) and
Purchaser (or an Affiliate of Purchaser) of even date herewith, pursuant to
which Supplier (or an Affiliate of Supplier) will operate, maintain and service
the Turbines.


 


“OMS Manual” means the detailed operations, and
maintenance service manual for the Turbines supplied to Purchaser by Supplier,
together with any future updates and supplements thereto provided by Supplier.


 


“Operating Force Majeure Events” means any event
beyond the reasonable control of Supplier or Operator, as applicable,
including, without limitation, (i) war, hostilities, insurrection, riot,
vandalism or other public disorder or civil disturbance; acts of God, fires,
hurricanes, thunder storms (including thunder storm watches or warnings
declared for the area including the Project Site by the National Weather
Service), tornadoes (including tornado watches or warnings declared for the
area including the Project Site by the National Weather Service), mudslides,
hail, earthquakes, lightning (including lightning blade strikes), or
explosions; expropriation or confiscation, strikes, lockouts or other labor
disputes, a Change in Law; epidemic or quarantine; damage or obstruction to any
part of the Project caused by persons other than Supplier, its Affiliates or
their respective Subcontractors; a condition at the Site that would not
reasonably have been discovered by a project supplier comparable in experience
to Supplier conducting a competent and diligent visual inspection, (ii) wind
velocity at a constant speed or in gusts such that a reasonably prudent professional
qualified operator engaged in the business of performing routine maintenance on
wind energy generation facilities comparable to the Project owned by it, acting
for the advancement and protection of its own economic interests, would not
make the required repair at such time due to risks to persons or property, (iii) with
respect to the Turbines, any conditions at the Project Site that are either
outside the operating parameters or standards for an IEC Class IIB wind
turbine, as published as of the Effective Date by the IEC, or outside the
operating parameters or standards for the Turbine, as set forth in the Turbine
Specifications, which operating parameters or standards may include, without
limitation, conditions involving ambient temperatures or wind speed and/or
turbulence at the air density at the Project Site, (iv) delays caused by
inclement weather within the vicinity of the Project Site and affecting the
operation of the Project to the extent that such inclement weather is
materially greater than that normally experienced for the time of year and
locality and (v) unavailability of the grid for any reason not caused by
Supplier. The failure to provide Interconnection Facilities


 


I-6

















 


that are energized and
operational in a manner that will permit the transmission and sale of power
from a Turbine and related Electrical Infrastructure shall be deemed an
Operating Force Majeure Event with respect to such Turbine until such time as
the Interconnection Facilities are provided and sufficiently operational with
respect to each such Turbine.


 


“Operator”
shall mean the person or entity hired by Project Manager to operate the Project
pursuant to the OMS Agreement.


 


“Party”
and “Parties” has the meaning given in the Preamble to the Supply Agreement.


 


“Permit”
means any valid waiver, exemption, variance, franchise, permit, authorization,
license or similar order, of or from any federal, state, county, municipal,
local, regional, or other governmental body, instrumentality, agency,
authority, court or other body having jurisdiction over the matter in question.


 


“Power
Curve” means the energy values produced by the Turbines at the various wind
speed bands set forth in Exhibit C-2 of the Warranty Agreement.


 


“Power
Curve Warranty Buydown” means any payment made pursuant to Section 3.3(c) of
the Warranty Agreement.


 


“Progress
Payment” shall have the meaning given in Section 3.3 of the Supply
Agreement.


 


“Project”
has the meaning given in the Recitals of the Supply Agreement.


 


“Project
Completion” shall occur upon the Completion of the Turbines.


 


“Project
Completion Certificate” shall mean a certificate, in the form attached as Exhibit N
to the Supply Agreement, delivered by Supplier to Purchaser following
Completion of Commissioning of the Turbines.


 


“Project
Site” means the site described in Exhibit O of the Supply
Agreement.


 


“Proven
Power Curve Percentage” or “PPCP” shall have the meaning given in Exhibit B
to the Warranty Agreement.


 


“Prudent
Electrical Industry Practices” means those practices, methods, standards and
acts (including those engaged in or approved by a significant portion of the
power industry for similar facilities in the United States) that at a
particular time in the exercise of good judgment would have been expected to
comply with Governmental Requirements, and to promote safety, environmental
protection, economy and expedition.


 


“Prudent
Wind Industry Practices” means standards and practices that are widely accepted
by the wind energy industry for wind projects of this size and that are
prudently applied and reasonably anticipated and intended to maximize output
and productivity of the Turbines, consistent with their intended design lives.


 


I-7

















 


“PTC
Benefits” means the tax credits that Purchaser may be eligible to claim for the
production of renewable energy by the Project in accordance with Section 45
of the United States Internal Revenue Code, as in effect as of the date of this
Agreement.


 


“Purchaser”
includes the named Purchaser identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Purchaser
Permits” mean all Permits required in connection with the development,
construction, ownership and operation of the Project, other than the Supplier
Permits.


 


“SCADA
System” means a supervisory control and data acquisition system, including a
central computer and related software, whether supplied and installed by
Supplier or by a third party, as more particularly described in the SCADA
System Specifications.


 


“SCADA
System Installation Manual” means the manual attached to the Supply Agreement
as Exhibit V.


 


“SCADA
System Specifications” means those specifications set forth on Exhibit U
to the Supply Agreement, pertaining to the SCADA System.


 


“Services”
shall mean the Commissioning Work.


 


“Site
Agreements” means any agreement between Purchaser, Project Manager, Supplier or
Operator, and any third party, with respect to the operation or maintenance of
the Project.


 


“Subcontractors”
means such subcontractors, consultants or suppliers which in the Supplier’s
reasonable judgment may be necessary to complete Supplier’s duties and
obligations under the Supply Agreement.


 


“Supplier”
includes the named Supplier identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Supplier
Permits” means the Supplier Permits listed on Exhibit R to the
Supply Agreement.


 


“Supply
Agreement” means the Turbine Supply Agreement dated as of December 31,
2007 by and between Supplier and Purchaser and any amendments thereto.


 


“Supply
Items” means, collectively, the Major Turbine Components and Ancillary Parts
and Equipment.


 


“Supply
Obligations” means Supplier’s obligations under the Supply Agreement to (i) supply
Purchaser the Supply Items and (ii) provide Purchaser certain services in
connection with the Supply Items, including (a) supplying, packing,
shipping and Delivering all Supply Items to their Designated Delivery
Locations; (b) at Purchaser’s request, providing a technical adviser to be
present at the Project Site during Turbine Installation; and (c) performing
the Commissioning Work.


 


I-8

















 


“Testing
Engineer” means Garrad Hassan Germanischer Lloyd, the National Renewable Energy
Laboratory, or Global Energy Concepts, or such other independent engineer as
mutually agreed.


 


“Tower”
means each 77.4 meter steel tubular tower component of a Turbine having a hub
height of approximately eighty meters (80 m) (measured from the base of such
tower to the center of the Turbine hub) upon which a Turbine Nacelle shall be
mounted, including all ladders, platforms, internal lighting, safety equipment,
and all parts and assemblies necessary for a complete turbine tower, all as
further described in the Turbine Specifications.


 


“Tower
Foundation Requirements” means Supplier’s requirements for the foundation upon
which the Towers are to be erected (which shall specify foundation loads, bolt
configuration, cable configuration and grounding requirements).


 


“Transferee
Agreement and Acknowledgement” means the Agreement and Acknowledgement executed
by Owner and delivered to Supplier in the form attached hereto as Exhibit K
to this Agreement.


 


“Transmission
Facilities” mean the underground and/or overhead distribution, collection and
transmission lines; underground and/or overhead control, communications and
radio relay systems and telecommunications equipment; energy storage
facilities; interconnection and/or switching facilities, circuit breakers,
transformers; cables, wires, fiber, conduit, footings, foundations, towers,
poles, crossarms, guy lines and anchors, and any related or associated
improvements, fixtures, facilities, appliances, machinery and equipment.


 


“Turbine”
has the meaning given in the Recitals to the Supply Agreement.


 


“Turbine
Blade” means a turbine blade component of a Turbine (each Turbine shall have
three (3) Turbine Blades).


 


“Turbine Component
Storage Requirements” means Supplier’s standard requirements for storage and maintenance
of Turbine Components pending installation.


 


“Turbine
Controller” means the circuit breaker and controller equipment for each Turbine
as further described in the Turbine Specifications.


 


“Turbine
Installation Manual” means Supplier’s detailed manual for the Installation
Work.


 


“Turbine
Nacelle” means the turbine nacelle component of a Turbine, including gearbox,
generators, blade pitch controls, brakes, hydraulic systems, lightning
protection system, and nacelle yaw controls, and associated control and
ancillary equipment.


 


“Turbine
Specifications” means those specifications set forth in Exhibit S
to the Supply Agreement pertaining to the Turbines.


 


“Turbine
Supply Documents” means, collectively, the Supply Agreement, the Warranty
Agreement, the OMS Agreement and all other agreements, documents or other
instrument


 


I-9

















 


executed and delivered by
the Parties hereto in connection with the supply, installation (if applicable)
and maintenance of the Turbines.


 


“Warranted
Power Curve Percentage” or “WPCP” has the meaning given in Exhibit B
to the Warranty Agreement.


 


“Warranties”
means the Standard Warranty, the Availability Warranty, the Power Curve
Warranty, the Sound Warranty, and the IP Warranty given hereunder.


 


“Warranty
Agreement” means that certain warranty agreement by and between Supplier and
Purchaser of even date herewith, pursuant to which Supplier makes certain
covenants and warranties to Purchaser with respect to the Major Turbine
Components supplied pursuant to this Agreement.


 


“Warranty
Period Year” means, for the Turbines, the period beginning on the earlier of (a) the
date of Project Completion, or (b) six (6) months after the last Major
Turbine Component is Delivered to Purchaser, and ending exactly twelve (12)
months thereafter, and each of the following four (4) twelve (12) month periods
thereafter; provided, however that the last of such periods shall not extend
beyond the end of the Warranty Period.


 


I-10














 


[2011 TSA]


 


CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS AGREEMENT. THE REDACTIONS ARE
INDICATED WITH FIVE ASTERISKS (“*****”). 
A COMPLETE VERSION OF THIS AGREEMENT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.


 


Execution Copy


 


TURBINE SUPPLY AGREEMENT


 


BY AND BETWEEN


 


UPC WIND ACQUISITION V, LLC


 


AND


 


CLIPPER TURBINE WORKS, INC.


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE 1

  	
  DEFINITIONS AND RULES
  OF INTERPRETATION

  	
  1

  
	
  1.1

  	
  Definitions

  	
  1

  
	
  1.2

  	
  Rules of
  Interpretation

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
  SUPPLY AND OTHER
  OBLIGATIONS OF SUPPLIER

  	
  2

  
	
  2.1

  	
  Supply and
  Commissioning Obligations

  	
  2

  
	
  2.2

  	
  Permits; Governmental
  Requirements

  	
  3

  
	
  2.3

  	
  Purchaser’s Right to
  Inspect

  	
  3

  
	
  2.4

  	
  Subcontractors

  	
  3

  
	
  2.5

  	
  Safety

  	
  4

  
	
  2.6

  	
  Independent Contractor

  	
  4

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
  PURCHASE PRICE AND
  PAYMENT

  	
  4

  
	
  3.1

  	
  Purchase Price

  	
  4

  
	
  3.2

  	
  Taxes

  	
  4

  
	
  3.3

  	
  Progress Payments

  	
  5

  
	
  3.4

  	
  Punch List Retainage

  	
  6

  
	
  3.5

  	
  Purchaser’s Credit
  Support

  	
  6

  
	
  3.6

  	
  Warranty Agreement

  	
  6

  
	
  3.7

  	
  Operations and
  Maintenance Service Agreement

  	
  6

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
  DUTIES AND OBLIGATIONS
  OF PURCHASER

  	
  6

  
	
  4.1

  	
  Purchaser’s Obligations

  	
  6

  
	
  4.2

  	
  Cooperation with
  Supplier; Purchaser’s Representative

  	
  7

  
	
  4.3

  	
  Permits; Governmental
  Requirements

  	
  8

  
	
  4.4

  	
  Safety

  	
  8

  
	
  4.5

  	
  Intellectual Property
  Rights: Licenses and Obligations

  	
  8

  
	
  4.6

  	
  Transfer

  	
  10

  
	
  4.7

  	
  Access to Information

  	
  10

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
  COMMENCEMENT, DELIVERY
  AND SHIPMENT

  	
  10

  
	
  5.1

  	
  Commencement.

  	
  10

  
	
  5.2

  	
  Shipping Arrangements

  	
  10

  
	
  5.3

  	
  Delivery Schedule

  	
  10

  
	
  5.4

  	
  Designated Delivery
  Locations

  	
  11

  
	
  5.5

  	
  Delay Delivery Damages

  	
  11

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
  FINAL ASSEMBLY WORK,
  INSTALLATION WORK, COMMISSIONING WORK AND PROJECT COMPLETION

  	
  12

  
	
  6.1

  	
  Final Assembly Work and
  Turbine Installation

  	
  12

  
	
  6.2

  	
  Commissioning

  	
  12

  
	
  6.3

  	
  Project Completion

  	
  13

  
	
  6.4

  	
  Purchaser Delays

  	
  13

  



 


i

















 


TABLE OF CONTENTS

(continued)


 


	
  ARTICLE 7

  	
  FORCE MAJEURE EVENTS

  	
  13

  
	
  7.1

  	
  Excused Performance

  	
  13

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
  CHANGE ORDERS

  	
  14

  
	
  8.1

  	
  Change Order

  	
  14

  
	
  8.2

  	
  Change Order Process

  	
  14

  
	
  8.3

  	
  No Change

  	
  14

  
	
  8.4

  	
  Scope Changes Caused by
  a Force Majeure Event

  	
  14

  
	
  8.5

  	
  Scope Changes Caused by
  Events within the Control of Purchaser

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
  LIMITATION OF LIABILITY

  	
  15

  
	
  9.1

  	
  Supplier Not
  Responsible for Purchaser’s Work

  	
  15

  
	
  9.2

  	
  Overall Limitation of
  Liability

  	
  15

  
	
  9.3

  	
  Consequential Damages

  	
  15

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
  TITLE AND RISK OF LOSS;
  INSURANCE

  	
  16

  
	
  10.1

  	
  Title to Supply Items

  	
  16

  
	
  10.2

  	
  Risk of Loss

  	
  16

  
	
  10.3

  	
  Insurance

  	
  16

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11

  	
  REPRESENTATIONS AND
  WARRANTIES OF SUPPLIER

  	
  20

  
	
  11.1

  	
  Due Organization; Good
  Standing

  	
  20

  
	
  11.2

  	
  Due Authorization

  	
  20

  
	
  11.3

  	
  Execution and Delivery

  	
  20

  
	
  11.4

  	
  Governmental Approvals

  	
  20

  
	
  11.5

  	
  Supply Items; Services

  	
  20

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
  REPRESENTATIONS AND
  WARRANTIES OF PURCHASER

  	
  20

  
	
  12.1

  	
  Due Organization; Good
  Standing; Qualified To Do Business

  	
  20

  
	
  12.2

  	
  Due Authorization

  	
  21

  
	
  12.3

  	
  Execution and Delivery

  	
  21

  
	
  12.4

  	
  Government Approvals

  	
  21

  
	
  12.5

  	
  Project Site

  	
  21

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13

  	
  MUTUAL INDEMNITY

  	
  21

  
	
  13.1

  	
  Mutual Indemnity

  	
  21

  
	
   

  	
   

  	
   

  
	
  ARTICLE 14

  	
  DEFAULT; CURE; REMEDIES

  	
  21

  
	
  14.1

  	
  Default by Supplier

  	
  21

  
	
  14.2

  	
  Purchaser’s Remedies

  	
  22

  
	
  14.3

  	
  Default by Purchaser

  	
  22

  
	
  14.4

  	
  Supplier’s Remedies

  	
  23

  
	
  14.5

  	
  Cancellation Due to a
  force Majeure Event

  	
  23

  
	
  14.6

  	
  Termination *****

  	
  23

  
	
  14.7

  	
  Surviving Obligation

  	
  24

  



 


ii

















 


TABLE
OF CONTENTS

(continued)


 


	
  ARTICLE 15

  	
  DISPUTE RESOLUTION

  	
  24

  
	
  15.1

  	
  Procedure

  	
  24

  
	
  15.2

  	
  Qualifications of
  Arbitrators; Expenses

  	
  26

  
	
  15.3

  	
  Performance During
  Dispute

  	
  27

  
	
  15.4

  	
  Consolidation

  	
  27

  
	
  15.5

  	
  Language

  	
  27

  
	
   

  	
   

  	
   

  
	
  ARTICLE 16

  	
  GENERAL PROVISIONS

  	
  27

  
	
  16.1

  	
  Waiver

  	
  27

  
	
  16.2

  	
  Successors and Assigns

  	
  27

  
	
  16.3

  	
  Permitted Assignments

  	
  27

  
	
  16.4

  	
  Notices

  	
  28

  
	
  16.5

  	
  Governing Law

  	
  29

  
	
  16.6

  	
  Amendments

  	
  29

  
	
  16.7

  	
  Attachments
  Incorporated

  	
  29

  
	
  16.8

  	
  Entire Agreement

  	
  29

  
	
  16.9

  	
  Confidentiality

  	
  29

  
	
  16.10

  	
  Counterparts

  	
  30

  
	
  16.11

  	
  English Language
  Documents

  	
  30

  
	
  16.12

  	
  Severability

  	
  30

  
	
  16.13

  	
  Headings

  	
  30

  
	
  16.14

  	
  Agreement Revisions

  	
  30

  



 


iii

















 


Exhibits


 


	
  Appendix I

  	
   

  	
  Definitions

  
	
  Exhibit A

  	
   

  	
  Ancillary Parts and
  Equipment

  
	
  Exhibit B

  	
   

  	
  Payment Schedule

  
	
  Exhibit C

  	
   

  	
  Spare Parts

  
	
  Exhibit D

  	
   

  	
  Turbine Installation
  Manual

  
	
  Exhibit E

  	
   

  	
  Foundation Loads
  Document

  
	
  Exhibit F

  	
   

  	
  Turbine Component
  Storage Requirements

  
	
  Exhibit G

  	
   

  	
  Termination Schedule

  
	
  Exhibit H

  	
   

  	
  Supplier’s Major
  Turbine Component Suppliers

  
	
  Exhibit I

  	
   

  	
  Supplier Account

  
	
  Exhibit J

  	
   

  	
  Guaranty

  
	
  Exhibit K

  	
   

  	
  Transferee Agreement
  and Acknowledgment

  
	
  Exhibit L

  	
   

  	
  Delivery Schedule

  
	
  Exhibit M

  	
   

  	
  Commissioning
  Certificate

  
	
  Exhibit N

  	
   

  	
  Project Completion
  Certificate

  
	
  Exhibit O

  	
   

  	
  Commissioning and
  Start-Up Procedures

  
	
  Exhibit P

  	
   

  	
  Final Assembly Work

  
	
  Exhibit Q

  	
   

  	
  Project Site

  
	
  Exhibit R

  	
   

  	
  Supplier Permits

  
	
  Exhibit S

  	
   

  	
  Turbine Specifications

  
	
  Exhibit T

  	
   

  	
  Completion Schedule

  
	
  Exhibit U

  	
   

  	
  SCADA System
  Specifications

  
	
  Exhibit V

  	
   

  	
  SCADA System
  Installation Manual

  



 


i

















 


TURBINE SUPPLY AGREEMENT


 


THIS
TURBINE SUPPLY AGREEMENT (the “Agreement” or the “Supply Agreement”) is made
and entered into and effective as of December 31,2007 by and between
CLIPPER TURBINE WORKS, INC., a Delaware corporation (“Supplier”), and UPC WIND
ACQUISITION V, LLC, a Delaware limited liability company with a place of
business c/o UPC Wind Management, LLC, 85 Wells Ave., Suite 305, Newton,
MA 02459 (“Purchaser”). Supplier and Purchaser are sometimes referred to,
individually, as a “Party” or, collectively, as the “Parties”.


 


RECITALS


 


WHEREAS,
Purchaser desires to purchase, and Supplier desires to sell forty (40) Clipper
Windpower 2.5 MW “C-96” series wind turbine generators (each a ‘Turbine” and
collectively, the “Turbines”), each consisting of the Major Turbine Components
and Ancillary Parts and Equipment (as set forth in Exhibit A
hereto). Additionally, Purchaser, in connection with its purchase of the
Turbines, desires to purchase and Supplier desires to provide the Commissioning
Work (as defined in Appendix I hereto), all on the terms and subject to
the conditions set forth herein.


 


WHEREAS,
Purchaser shall incorporate the Turbines into a single 100 MW wind power
project being developed by Purchaser to be located in the continental United
States (the “Project”).


 


NOW,
THEREFORE, for good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged, Supplier and Purchaser, intending to be legally
bound, hereby agree as follows:


 


AGREEMENT


 


ARTICLE 1


 


DEFINITIONS AND RULES OF
INTERPRETATION


 


1.1          Definitions.
For purposes of the Turbine Supply Documents and all schedules, exhibits and
attachments thereto, and in addition to the definitions elsewhere in this
Agreement and the other Turbine Supply Documents, the terms listed in Appendix
I hereto shall have the respective meanings assigned to such terms in Appendix
I hereto, which is incorporated herein and made a part hereof.


 


1.2          Rules of
Interpretation. In this Agreement: (a) references to Sections and to
Exhibits are, unless otherwise indicated, to Sections of and Exhibits to this
Agreement; (b) the headings to Sections and Articles of this Agreement are
for ease of reference only and shall not in any way affect its construction or
interpretation; (c) the masculine gender shall include the feminine and
neuter and the singular number shall include the plural, and vice versa, and
references to persons shall include individuals, bodies corporate,
unincorporated associations, companies and partnerships; and


 


1

















 


(d) references
to Parties in this Agreement shall be deemed to include references to their
successors and permitted assigns.


 


ARTICLE 2


 


SUPPLY AND OTHER OBLIGATIONS OF
SUPPLIER


 


2.1                    Supply and
Commissioning Obligations. Purchaser hereby agrees to purchase and, subject
to the terms and provisions hereof, Supplier agrees to supply and Deliver as
provided in Subsections (a) and (b) below, the Supply Items and
related Services for the Turbines. With respect to the Supply Items and related
Services, following Purchaser’s submittal to Supplier of the Down Payment, and
subject to the compliance by Purchaser with the terms hereof, Supplier agrees
to do the following respecting the Supply Items and Services:


 


(a)      supply, pack,
and Deliver, in accordance with wind industry practice and commercially
reasonable shipping carrier requirements and in an economic manner consistent
with wind industry practices, all Supply Items, the SCADA System and all
related components and parts (other than foundations, foundation bolts, pad
mount transformers and collection lines, communication lines and related
equipment to be supplied by Purchaser) necessary to install and commission wind
turbine generators in the quantity set forth above that are capable of
performing to the Turbine Specifications (the “Supply Obligations”);


 


(b)      perform the
Commissioning Work, as described in Section 6.2 below.


 


2.1.1                              Failure to Timely
Deliver Down Payment. If Purchaser fails to deliver to Supplier the Down
Payment on or before the Down Payment Date, then Purchaser’s right to purchase
and Supplier’s obligation to sell and Deliver the Supply Items and related
Services shall terminate at the option of Supplier and be of no further force
or effect, provided that Supplier shall first give Purchaser five (5) days
written notice to afford Purchaser the opportunity to correct its performance.


 


2.1.2                         Spare Parts.


 


(a)      During the
Warranty Period, Supplier shall maintain an inventory of spare parts at such
location and consisting of such spare parts as Supplier, in its sole
discretion, shall determine necessary for the timely operation and maintenance
of the Turbines during the Warranty Period (the “Necessary Spare Parts
Inventory”). The list of spare parts proposed by Supplier is attached hereto as
Exhibit C. It is the intention of the parties that the Necessary
Spare Parts Inventory be used and maintained during the Warranty Period in
order for Supplier to fulfill its obligations under the OMS Agreement and the
Warranty Agreement.


 


(b)      Purchaser may
purchase such additional spare parts, at Purchaser’s sole expense, and maintain
such additional spare parts on the Project Site, at Purchaser’s sole expense;
provided that such spare parts are available from Supplier without unreasonably
impacting Supplier’s production of turbines.


 


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(c)                      Within six (6) months
of the date of final payment by Purchaser to Supplier of the Purchase Price,
Supplier shall place into escrow with an escrow agent to be agreed upon between
the parties, subject to an escrow agreement to be agreed between the parties, drawings
(the “Spare Parts Drawings”) necessary for Purchaser to make or have made any
spare parts for the Turbines whose manufacture are subject to intellectual
property rights of Supplier. Pursuant to the terms of the agreed upon escrow
agreement, Purchaser shall be provided access to the Spare Parts Drawings only
if and when Supplier is unable to provide necessary spare parts for the
Turbines to Purchaser due to a default under Section 14.1(i), (ii), (iii) or
(iv) under this Agreement.


 


2.1.3                              SCADA System.
Purchaser shall purchase the SCADA System from Supplier (exclusive of any fiber
optic lines or other communication lines) for an amount equal to ***** Dollars
($*****) as may be adjusted by CCI as further described in Exhibit B. The
price of the SCADA System is included in the Purchase Price.


 


2.1.4                              [Intentionally Left
Blank].


 


2.1.5                              Other Items.
Supplier has provided Purchaser with: the Turbine Installation Manual, a copy
of which is set forth on Exhibit D; the Foundation Loads Document,
a copy of which is set forth on Exhibit E; and the Turbine
Component Storage Requirements, a copy of which is set forth on Exhibit F.
No later than ten (10) days prior to the anticipated Commissioning of the
first Turbine, Supplier shall provide to Purchaser the OMS Manual. Concurrently
with the execution of this Agreement, Supplier and Purchaser shall deliver to
the other Party the Warranty Agreement and the OMS Agreement, duly executed by
each Party. At Purchaser’s request and at Purchaser’s cost, within twelve (12)
months of Commissioning of the last Turbine, Supplier shall provide to
Purchaser a location specific site suitability certificate from Germanischer
Lloyd.


 


2.2            Permits;
Governmental Requirements. Supplier shall secure and pay for all Supplier
Permits required for the Delivery of the Supply Items to the Designated
Delivery Location. Purchaser shall cooperate with Supplier in obtaining the
Supplier Permits. Supplier shall have no obligation to obtain any Purchaser
Permit; provided Supplier shall cooperate with Purchaser in Purchaser’s efforts
to obtain and comply with Purchaser Permits. Supplier shall comply with all
Governmental Requirements applicable to the performance of its obligations
hereunder.


 


2.3            Purchaser’s
Right to Inspect. Supplier shall permit Purchaser, upon ten (10) days
prior written notice to Supplier, to inspect the Turbines and to visit Supplier’s
Turbine manufacturing and assembly facilities for such purpose, subject in all
cases to Supplier’s confidentiality requirements and reasonable safety
precautions, and so long as such inspection and presence does not unreasonably
interfere with or delay the completion or Delivery of the Turbines or Supplier’s
performance of its obligations hereunder.


 


2.4            Subcontractors.
Supplier may retain such Subcontractors as in Supplier’s reasonable judgment
may be necessary to complete Supplier’s duties and obligations under this
Agreement. Supplier shall be solely responsible to pay its Subcontractors and
the use of any Subcontractor shall not limit Supplier’s obligations hereunder.
The list of Supplier’s Major Turbine Component suppliers is set forth on Exhibit H.
Supplier agrees that it will not use any Major Turbine Components not listed on
Exhibit H


 


3

















 


without Purchaser’s
advance written consent, such consent not to be unreasonably withheld,
conditioned or delayed.


 


2.5           Safety.
Until any Supply Item has been Delivered, Supplier shall take reasonable steps
to protect each Supply Item against damage, destruction or theft, and shall
ensure that all Supplier Insurance covering the Turbines remains in full force
and effect prior to Delivery.


 


2.6           Independent
Contractor. In performing its duties and obligations under this Agreement,
Supplier shall, at all times, act in the capacity of an independent contractor,
and shall not in any respect be deemed (or act as) an agent of Purchaser for
any purpose or reason whatsoever. Supplier shall have no responsibility for any
of Purchaser’s Work hereunder.


 


ARTICLE 3


 


PURCHASE PRICE AND PAYMENT


 


3.1           Purchase
Price. For the Supply Items, SCADA System and Services, Purchaser shall pay
to Supplier ***** Dollars ($*****), which amount shall be adjusted pursuant to
the CCI as defined in Exhibit B attached hereto (the “Purchase
Price”). Purchaser shall pay to Supplier on the date of this Agreement (the “Down
Payment Date”) a non-refundable amount equal to ***** Dollars ($*****) (the “Down
Payment”). All payments to be made under this Agreement by Purchaser to
Supplier shall be made in immediately available funds to the Supplier account
set forth in Exhibit I. The Purchase Price is subject to adjustment
by Change Order as provided in this Agreement.


 


3.2           Taxes.
Supplier shall be responsible for (a) all federal and state income taxes
payable by Supplier in connection with its net income, (b) all taxes in
connection with the import of any Supply Item into the United States, and (c) any
business license or fees arising in connection with Supplier’s business in any
State. Purchaser shall be responsible for all sales and use tax and any other
federal, state or local taxes imposed on the sale or use of the Supply Items
and any services provided hereunder (collectively “Taxes”).


 


3.3                             Progress
Payments.


 


3.3.1             The remaining amount of the Purchase Price
shall be paid by the Purchaser to the Supplier pursuant to the Payment Schedule
set forth on Exhibit B attached hereto (the “Payment Schedule”).
Upon completion of each of the milestones for the Project set forth on Exhibit B
attached hereto, the corresponding portion of the Purchase Price shall be due
and payable to Supplier as set forth on Exhibit B attached hereto
(each, a “Progress Payment”).


 


(a)           Purchaser
shall pay the Down Payment and each Progress Payment to Supplier in United
States Dollars and in immediately available funds to the account of Supplier,
identified on Exhibit I. Should Purchaser fail to make any Progress
Payment when due, in addition any other remedy available to Supplier under this
Agreement, or otherwise, (i) Supplier may enforce the Guaranty as set
forth in Section 3.5 pursuant to its terms; (ii) such overdue
amount shall bear interest until paid in full at the Default Rate, and (iii) Supplier
may, without prejudice to any other rights or remedies it may have under this
Agreement, stop its performance hereunder until the overdue amount and interest
thereon is paid in full.


 


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(b)          Provided
that Supplier has duly performed or is reasonably performing its obligations
hereunder and irrespective of any other term of this Agreement, and provided
that any delay in obtaining the Project Completion Certificate within six (6) months
after Delivery of the last Major Turbine Component by Supplier for the Project
is not caused solely by Supplier or any of Supplier’s Affiliates or
subcontractors, one hundred percent (100%) of the Purchase Price, subject to
the retention of the applicable Punch List Retainage, shall be paid by Purchaser
to Supplier no later than six months after Delivery of the last Major Turbine
Component by Supplier for the Project.


 


(c)           *****


 


3.4                    Punch List
Retainage. In delivering the Project Completion Certificate as provided in Section 6.3
below hereunder, Supplier shall include an estimated cost to complete each item
of Punch List Work (200% of such estimated costs being the “Punch List
Retainage”). The Progress Payment corresponding to delivery of the Project
Completion Certificate shall be decreased by an amount, if any, which is equal
to the Punch List Retainage, and upon the completion of any item of Punch List
Work to the reasonable satisfaction of Purchaser, Purchaser shall immediately
pay Supplier the Punch List Retainage that was retained by Purchaser for such
item of Punch List Work.


 


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3.5         Purchaser’s
Credit Support. Purchaser shall, concurrently with the delivery by
Purchaser of the Down Payment, deliver to Supplier a guaranty from its parent
company (the “Guaranty”) in substantially the form attached hereto as Exhibit J.


 


3.6         Warranty
Agreement. The Parties acknowledge that, concurrent with the execution of
this Agreement, the Parties shall enter into the Warranty Agreement. The cost
of the first two (2) years of warranty coverage under the Warranty
Agreement is included in the Purchase Price.


 


3.7         Operations
and Maintenance Service Agreement. Concurrent with the execution of this
Agreement, Affiliates of the Purchaser and Supplier shall execute an OMS
Agreement whereby Supplier, an Affiliate of Supplier, or a contractor
designated by Supplier and approved by Purchaser (the “Contractor”) shall
provide operation and maintenance service to the Project. Pursuant to the terms
of the OMS Agreement, the cost for the first two (2) years of OMS Services
(other than Additional OMS Services) is included in the Purchase Price.


 


ARTICLE 4


 


DUTIES AND OBLIGATIONS OF PURCHASER


 


4.1                  Purchaser’s
Obligations. Purchaser agrees to perform the following, all on the terms
and subject to the conditions of this Agreement:


 


4.1.1           Payment. Purchaser shall make the
Down Payment, all Progress Payments and any other payments due Supplier under
this Agreement when due and shall be responsible for and promptly pay all
Taxes.


 


4.1.2           Purchaser’s Work. Purchaser shall, at
its sole cost and expense, be solely responsible for all work necessary for the
development, construction, completion and operation of the Project (other than
the Delivery of Supply Items and the performance of the Services by Supplier)
and for the installation and operation of the Turbines, which work (herein “Purchaser’s
Work”) shall include the following:


 


(a)         Site Suitability and
Access. Purchaser shall ensure that the Project Site is suitable for
installation of the Turbines in accordance with the Turbine Specifications and
Turbine Installation Manual and shall ensure that Supplier has continuous
unfettered physical access to the Project Site during normal business hours
during the performance of its Commissioning Work;


 


(b)         Acceptance and
Shipment of Supply Items. Upon Supplier’s Delivery of any Supply Item to
its respective Designated Delivery Location, Purchaser shall, unless otherwise
agreed by the Parties, within five (5) days after notice from Supplier and
at such date and time set forth in Supplier’s notice, pick up the Supply Item
at its Designated Delivery Location, and ship, install or store such Supply
Item at the Project Site. Purchaser shall be responsible for any reasonable
costs incurred by Supplier due to Purchaser’s delay in promptly picking up and
transporting off site any Supply Item upon its Delivery within said five (5) day
period. Purchaser shall be solely responsible for shipment and insurance of
each Supply Item once picked up;


 


6

















 


(c)          Storage.
Purchaser shall ensure that adequate staging, lay down and storage areas for
the Supply Items are available and maintained at the Project Site and shall
store and maintain the Supply Items pending installation in accordance with the
Turbine Component Storage Requirements set forth on Exhibit F;


 


(d)         Tower
Foundations. Purchaser shall investigate the Project Site and its soil
conditions and shall design and construct the Tower Foundations in accordance
with Supplier’s Tower Foundation Requirements;


 


(e)          Turbine
and SCADA System Installation. Purchaser shall perform the Turbine
Installation Work and the installation of the SCADA System, all in strict
accordance with the Turbine Specifications, the Turbine Installation Manual and
the SCADA System Installation Manual; and shall (i) notify Supplier of
Purchaser’s proposed schedule for all such work; (ii) coordinate such work
with Supplier’s Commissioning Work for the Turbines; and (iii) complete
the Installation Work in such a manner so that a team of two technicians can
complete the Commissioning of each Turbine within a period not to exceed three
and a half (3 1⁄2)
Business Days, without interruption or delay on a continuous basis until all
Turbines have been Commissioned;


 


(f)            Construction of
Project. Purchaser shall (i) perform the Final Assembly Work which is
set forth in Exhibit P hereto, (ii) perform all civil works
(including roads, grading, maintenance facilities, meteorological towers and
other items); (iii) perform all electrical works (including collection
lines, Electrical Infrastructure, Transmission Facilities, Interconnection
Facilities and other items); (iv) provide and install a remote terminal
unit and cabling to the Substation, meteorological towers, and communications
lines for the SCADA System to the Substation; and (v) provide any other
items required for the operation of the Project; and


 


(g)           Commissioning
Responsibilities. Purchaser shall ensure that at all times during
Commissioning Work, each Turbine shall have a continuous supply of electricity
from the grid, and that Purchaser’s utility will accept electricity generated
by such Turbine. During Commissioning, Purchaser shall provide assistance,
including equipment, electricians and mechanics, as may be reasonably required
by Supplier to address any out of scope impacts on the completion of
Commissioning. Purchaser shall arrange for the provision of full grid power to
each Turbine to ensure completion of the Commissioning Work for each Turbine.


 


4.1.3           Other Items. On or before the date
that is thirty (30) days prior to the date of Delivery of the first Major
Turbine Component for the Project, Purchaser shall provide Supplier with
notification of the anticipated date that Purchaser will energize the
substation for the Project.


 


4.2                  Cooperation
with Supplier; Purchaser’s Representative. Purchaser shall cooperate with
Supplier and, if applicable, shall cause its EPC Contractor and any other
contractors engaged by Purchaser with respect to the Project (herein, “Purchaser’s
Contractors”), to cooperate with Supplier, all in connection with Supplier’s
performance of its obligations hereunder. Purchaser shall promptly provide
Supplier with a schedule of the names and contact information for all of
Purchaser’s


 


7

















 


Contractors and shall
update such schedule periodically. Purchaser designates Scott Rowland as its
representative (“Purchaser’s Representative”) in dealing with Supplier with
respect to this Agreement.


 


4.3         Permits;
Governmental Requirements. Purchaser shall secure and pay for all Purchaser
Permits, including any permits required for the delivery of Supply Items from
the Designated Delivery Location to the Project Site. Supplier shall cooperate
with Purchaser in obtaining Purchaser’s Permits. Purchaser shall have no
obligation to obtain any Supplier Permit; provided that, Purchaser shall
cooperate with Supplier in Supplier’s efforts to obtain Supplier Permits.
Purchaser shall comply with all Governmental Requirements applicable to the
performance of Purchaser’s Work.


 


4.4         Safety.
Upon Delivery of any Supply Item to its Designated Delivery Location, Purchaser
shall take reasonable steps, and shall ensure that the EPC Contractor and the
Purchaser’s Contractors take reasonable steps, to protect any such Supply Item
against damage or theft.


 


4.5         Intellectual
Property Rights; Licenses and Obligations.


 


4.5.1           Patents. Supplier hereby grants to
Purchaser under Supplier’s patent rights, only the non-exclusive right to use
the Supply Items provided to Purchaser under this Agreement. Supplier expressly
reserves all other patent rights, including, without limitation, the right to
make, use, sell, offer for sale and import other products identical to or
similar to the Supply Items. Other than the rights granted herein with respect
to the Supply Items, Supplier expressly reserves all other patent rights, and
Purchaser shall not have the right under Supplier’s patent rights to make, use,
sell, offer for sale, or import any products or methods that infringe Supplier’s
patents or to sublicense any of the foregoing rights.


 


4.5.2           Trade Secrets. Purchaser acknowledges
that the technical, operation and maintenance, and other information it
receives in connection with the Supply Items (including, without limitation,
any and all firmware, software, Turbine Specifications, SCADA System
Specifications, installation and operation and maintenance procedures, know-how
and similar items) constitute trade secret information that is proprietary to
Supplier. Supplier hereby grants to Purchaser under Supplier’s trade secret rights,
the non-exclusive right to use such trade secrets only in the installation and
operation and maintenance of the Supply Items. Supplier further grants to
Purchaser under Supplier’s trade secret rights, the non-exclusive right to
disclose such trade secrets to a third party only as necessary for the
financing, installation and operation and maintenance of the Supply Items
provided such third party executes a written agreement obligating it to
maintain the confidentiality of the trade secret information and to return all
copies of such trade secret information received and prohibiting reverse
engineering, disassembly, and decompilation of any of the trade secret
information. Other than the rights granted herein with respect to the Supply
Items, Supplier expressly reserves all other trade secret rights. Purchaser
agrees to maintain all such trade secret information in strict confidence and
shall not disclose such trade secret information to any third party except in
accordance with this Section 4.5.2. The obligations of
confidentiality herein shall survive termination or expiration of this
Agreement.


 


4.5.3           Copyrights. Purchaser acknowledges
that the technical, operation and maintenance, and other information it
receives in connection with the Supply Items (including,


 


8

















 


without
limitation, any and all firmware, software, Turbine Specifications, SCADA
System Specifications, installation and operation and maintenance procedures,
descriptions of know-how and similar written items) constitute copyrightable
material. Supplier hereby grants to Purchaser under Supplier’s copyrights, the
non-exclusive right to copy and use such copyrighted materials only in the
installation and operation and maintenance of the Supply Items. Supplier
further grants to Purchaser under Supplier’s copyrights, the non-exclusive
right to copy the copyrightable materials and distribute such to a third party
only as necessary for the installation and operation and maintenance of the
Supply Items, provided such third party executes a written agreement obligating
it to return all copies of such copyrightable materials received, prohibiting
any further copying or distribution of such copyrightable materials, and
prohibiting reverse engineering, disassembly and decompilation of any of the
copyrightable materials. Other than the rights granted herein with respect to
the Supply Items, Supplier expressly reserves all other copyright rights.
Purchaser shall not have the right to sublicense any of the Supplier’s
copyright rights or the right to create derivative works of any of the
copyrightable materials. Purchaser shall not reverse engineer, disassemble or
decompile any of the copyrightable materials.


 


4.5.4        Trademarks and Service
Marks. Purchaser shall not have any rights in any trademarks or service
marks, whether registered or not, that are owned or controlled by Supplier.
Purchaser shall not utilize any trademark or service mark that is substantially
similar to any trademarks or service marks owned or controlled by Supplier.
Purchaser may reference only those trademarks or service marks owned by
Supplier in its written materials; provided that, such reference clearly
denotes that such is a trademark or service mark and is owned by Supplier.


 


4.5.5        Transfer of Title in
Supply Items. Should Purchaser transfer title in any of the Supply Items to
a third party, the licenses provided in this Section 4.5 shall run
with such Supply Items, provided such third party executes a Transferee
Agreement and Acknowledgment, in the form attached hereto as Exhibit K.
acknowledging Supplier’s ownership in the respective Intellectual Property
Rights and obligating itself to all of the same prohibitions and restrictions
with respect to Supplier’s Intellectual Property Rights described in this Section 4.5.
Purchaser acknowledges that the Supply Items may be subject to the export
control laws and regulations of the United States of America and agrees to
comply with all such laws and regulations regarding any export of any of the
Supply Items.


 


4.5.6        Ownership and
Injunctive Relief. All Intellectual Property Rights owned or controlled by
Supplier shall remain the exclusive property of Supplier and nothing herein
shall be construed as a sale, lease, loan, or transfer of any of such
Intellectual Property Rights. Purchaser shall derive no rights, title or
interest therein except as expressly set forth in this Agreement. Any technical
information concerning the Supply Items that Purchaser acquires or develops in
connection with the ownership or operation of the Turbines shall be the
property of Supplier. Further, Purchaser acknowledges that a breach of the
confidentiality provisions in this Agreement may cause Supplier irreparable
harm and damage that may not be recoverable at law and that Purchaser shall be
entitled to obtain injunctive relief in addition to any other rights or
remedies Purchaser may have.


 


4.5.7        Government Rights.
Any and all computer software and related documentation provided as part of the
Supply Items are “commercial items” as that term is defined at 48 C.F.R. 2.01 (October 1995)
comprising “commercial computer software” and


 


9

















 


“commercial
computer software documentation” as used in 48 C.F.R. 12.212 (September 1995)
and other applicable acquisition regulations and are provided to the U.S.
Government only as a commercial item and subject to the terms and conditions
and all restrictions set forth in this Agreement as applicable to such computer
software and related documentation Consistent with 48 C.F.R. 12.212 and 48
C.F.R. 227.7202 (June 1995), all U.S. Government users and licensees
acquire the software and its related documentation with only those rights
applicable to such software and related documentation as set forth in this Section 4.5.


 


4.6        Transfer.
Purchaser covenants and agrees that it will not sell, lease or otherwise
transfer the Turbines or any part thereof unless Purchaser first obtains and
delivers to Supplier a Transferee Agreement and Acknowledgment, executed by the
proposed transferee. Notwithstanding anything else contained herein, Purchaser
may assign in whole or in part its rights under this Agreement to an Affiliate
upon notice to Supplier.


 


4.7        Access to
Information. From the date of this Agreement through the end of the
fifteenth (15th) year after Project Completion, Purchaser shall provide to
Supplier prompt access to all technical, operational and maintenance and other
information it receives or collects in connection with its operating the Turbines.
The collection of all such data shall be at the reasonable expense of Supplier.
All information provided by Purchaser hereunder shall be subject to the
provisions of Section 16.9.


 


ARTICLE 5


 


COMMENCEMENT, DELIVERY AND SHIPMENT


 


5.1         Commencement. Subject
to Section 2.1.1. Supplier shall commence performance of its
obligations under this Agreement on the Down Payment Date. In addition to
Supplier’s other rights and remedies hereunder, if any payment due under this
Agreement is not timely made by Purchaser, the delinquent payment amount shall
accrue interest at the Default Rate.


 


5.2         Shipping Arrangements.
All Supply Items shall be delivered Ex Works at the Designated Delivery
Locations. For purposes of this Agreement, each individual Supply Item and the
SCADA System shall be deemed “Delivered” and Supplier shall have satisfied its
delivery arrangements with respect thereto, when Supplier makes available such
Supply Item and SCADA System at its Designated Delivery Location for pick up by
Purchaser, provided however, that Purchaser may not take custody and control of
the said Supply Item until the applicable Progress Payment has been made by
Purchaser and received by Supplier. Purchaser shall be responsible for all
loading and shipment of the Supply Items and SCADA System from their respective
Designated Delivery Locations to the Project Site and shall pay for all costs
and expenses incurred by Purchaser related thereto, including the costs of
maintaining insurance on such Supply Item and SCADA System during shipment of
such Supply Item and SCADA System from its respective Designated Delivery
Location to the Project Site.


 


5.3         Delivery Schedule.
The Supply Items shall be Delivered to their Designated Delivery Locations in
accordance with the Delivery Schedule attached as Exhibit L (the “Delivery
Schedule”); provided however, that Supplier shall use commercially reasonable
efforts to work with Purchaser to revise the Delivery Schedule as necessary
considering Supplier’s manufacturing


 


10

















 


schedules
and Purchaser’s Project requirements. Delivery dates in the Delivery Schedule
will be deemed met so long as the Supply Items are delivered to the Designated
Delivery Locations on or before the date for such delivery set forth in the
Delivery Schedule; provided that, Supplier shall have the right to Deliver the
Supply Items up to one (1) month earlier than provided for in the Delivery
Schedule. The SCADA System shall be delivered at a Designated Delivery Location
mutually agreed by the Parties following the installation of the first Turbine
at the Project Site by Purchaser.


 


5.4         Designated Delivery
Locations. Unless otherwise agreed in writing by the Parties, Supplier
shall Deliver the Supply Items as follows: (i) Turbine Nacelle, Turbine
Controller, Turbine hub and Ancillary Parts and Equipment at Supplier’s factory
near Cedar Rapids, Iowa, (ii) the Turbine Blades at such location or
warehouse facility as Supplier may direct near Houston, Texas, or at another
mutually agreed upon location, provided any costs associated with such other
mutually agreed location be borne by Purchaser, and (iii) the Towers at
the manufacturing facility located in Chattanooga, Tennessee, or at such other
domestic location as Supplier may specify at any point prior to three (3) months
from the Delivery date set forth in the Delivery Schedule. Each of the
foregoing locations is referred to herein as a “Designated Delivery Location.”


 


5.5         Delay Delivery Damages.
The Parties acknowledge that Purchaser will suffer damages that will be
difficult to ascertain if Purchaser fails to Deliver any Major Turbine
Component within thirty (30) days of the applicable date of Delivery set forth
in the Delivery Schedule. Consequently, the Parties agree that Supplier will
pay Purchaser, if any Major Turbine Component is Delivered thirty (30) days or
more late and such delay was not due to any Force Majeure Event or breach by
Purchaser of any of its obligations under this Agreement, the following amount
as liquidated damages: For each full day after the first thirty (30) days
following the date that the Delivery of such Major Turbine Component is delayed
beyond the date specified in the Delivery Schedule, an amount equal $***** per Turbine per day for the first
fifteen (15) days after delay payments become payable, an amount equal to
$***** per day for the next fifteen (15) days, and an amount equal to $*****
per day thereafter (the “Delay Delivery Damages”); provided that, in no event
shall the aggregate Delay Delivery Damages payable hereunder exceed *****
percent (*****%) of the pro-rata portion of the Purchase Price applicable to
the Turbine for which such delayed Major Turbine Component is a component. It
is understood and acknowledged by the Parties that if more than one Major
Turbine Component applicable to a Turbine is delivered late, the liquidated
damages applicable to the Turbine will not exceed $***** per day (for the first
15 days after delay payments become payable), $***** per day (for the next 15
days of delay payments), and $***** per day (for delay payments thereafter), as
applicable. The Parties acknowledge and agree that the Delay Delivery Damages
set forth above are a reasonable estimate of the damages Purchaser will suffer
because of late Delivery of any Major Turbine Component and that, therefore,
the Delay Delivery Damages set forth herein shall be Purchaser’s sole and
exclusive remedy with respect to such Delivery delays.


 


11

















 


ARTICLE 6


 


FINAL ASSEMBLY WORK, INSTALLATION
WORK,

COMMISSIONING WORK AND PROJECT COMPLETION


 


6.1         Final
Assembly Work and Turbine Installation. Purchaser shall complete the Final
Assembly Work with respect to all Turbines in conformance with the procedures
and requirements set forth in Exhibit P, and shall complete the
Installation Work with respect to all Turbines in accordance with the
Installation Procedures and, subject to Section 5.3 above, within
the period of time set forth on the Completion Schedule.


 


6.2         Commissioning.
Commissioning of the Turbines shall be conducted as follows:


 


6.2.1        Advance Completion
Notice. No less than thirty (30) days prior to the date Purchaser expects
Supplier to commence the Commissioning Work, Purchaser shall provide Supplier
with written notice (the “Advance Completion Notice”) of Purchaser’s
anticipated completion date of the Installation Work and the date on which
Supplier shall commence the Commissioning Work (which date shall be no later
than the date that Supplier is obligated to commence the Commissioning Work as
set forth in the Completion Schedule). Purchaser shall use commercially
reasonable efforts to schedule Turbine Installation for all Turbines in the
Project so that Supplier can complete the Commissioning of each Turbine without
interruption or delay on a continuous basis until all the Turbines have been
Commissioned.


 


6.2.2        Turbine Installation
Inspection. Following completion of the Installation Work with respect to
any Turbine, Purchaser shall deliver a written notice of completion to Supplier
(an “Installation Completion Notice”) and Supplier shall examine each Turbine
in accordance with the Installation Procedures and the Turbine Installation
Manual. If the Turbine fails to conform to the standards contained in the
installation inspection procedures set forth in the Turbine Installation
Manual, then it shall be deemed not properly installed, and Supplier shall
promptly so notify Purchaser. Purchaser shall then promptly take all required
action to complete the Installation Work for all Turbine(s) failing the
installation inspection procedures.


 


6.2.3        Commissioning Work.
Supplier shall perform the Commissioning Work for the Turbines in accordance
with the Commissioning and Start-Up Procedures and the Completion Schedule,
subject to any adjustment in the completion of the Commissioning Work, pursuant
to Section 5.3 hereof, due to Supplier’s early Delivery of the
Supply Items (provided, however, that Supplier’s obligation to Complete the
Commissioning Work by such time set forth on the Completion Schedule shall be
extended to the extent of Purchaser’s delay in completing the Installation
Work). Upon completion of the Commissioning of each Turbine, Supplier shall
issue to Purchaser a commissioning certificate for such Turbine in the form attached
hereto as Exhibit M (each a “Commissioning Certificate”). Within
five (5) days after receipt of a Commissioning Certificate, Purchaser
shall either approve such Commissioning Certificate or deliver to Supplier
written notice of any work remaining to be completed by Supplier (the “Punch
List Work”). If Purchaser fails to deliver such notice within such five (5) day
period, the Commissioning Certificate will be deemed approved by Purchaser.


 


12

















 


6.3        Project
Completion. Within five (5) days after the delivery by Supplier to
Purchaser of a Commissioning Certificate for the Project’s final Turbine,
Supplier shall also deliver to Purchaser a completion certificate for all
Turbines in the Project (the “Project Completion Certificate”), in the form
attached hereto as Exhibit N, together with a list of any remaining
Punch List Work on any Turbine, a schedule for completing the Punch List Work
and an estimate of the cost of each item of Punch List Work. Supplier shall
thereafter promptly complete all Punch List Work.


 


6.4         Purchaser
Delays. In the event that any of the actions of Purchaser, the EPC
Contractor or any of Purchaser’s Contractors cause a delay in the performance
by Supplier of the Commissioning Work, Purchaser shall pay Supplier its actual
documented costs directly attributable to such delay, including wages, lodging
and meals.


 


ARTICLE 7


 


FORCE MAJEURE EVENTS


 


7.1        Excused
Performance. If either Party is rendered wholly or partially unable to
perform its obligations (other than payment obligations) under this Agreement
due to the occurrence of a Force Majeure Event, such Party will be excused from
the affected performance obligation (other than payment obligations), provided
that:


 


(a)                      the
affected Party gives the other Party notice describing the particulars of the
occurrence, including an estimate of its expected duration and probable impact
on the affected Party’s obligations hereunder, such notice shall be given
promptly after becoming aware of the occurrence of the Force Majeure Event,
and, in no event more than seven (7) days after the affected Party becomes
aware or should reasonably have been aware of such occurrence;


 


(b)                      the
affected Party shall continually exercise all commercially reasonable efforts
to mitigate the effect of such Force Majeure Event, remedy its inability to
perform, and limit damages to the other Party and shall promptly resume its
performance when the Force Majeure Event no longer impacts its ability to
perform, and shall give the other Party prompt notice of its intent to resume
such performance;


 


(c)                       the
suspension of a Party’s performance affected by the Force Majeure Event shall
be of no greater scope and of no longer duration than is reasonably required by
the Force Majeure Event;


 


(d)                      no
liability of either Party which arose before the occurrence of the Force
Majeure Event shall be excused as a result of the occurrence thereof; and


 


(e)                       no
Force Majeure Event shall relieve any Party from performing those of its
obligations that are not materially affected by the Force Majeure Event.


 


13

















 


ARTICLE 8


 


CHANGE ORDERS


 


8.1          Change
Order. The term “Change Order” as used herein shall mean a written
instrument signed by Purchaser and Supplier, stating their mutual agreement
upon any of the following: (i) a change in the fabrication or features of
the Turbines (such as adding Federal Aviation Administration lighting or a cold
weather package); (ii) a change in the Delivery Schedule or Completion
Schedule; (iii) a change in the Commissioning Work; (iv) a change in
the number of or location of Project sites; or (v) an adjustment in the
Purchase Price (collectively “Scope Changes”).


 


8.2          Change
Order Process. Purchaser may request Scope Changes within the general scope
of this Agreement consisting of additions, deletions, or other revisions. If
Purchaser so desires to request Scope Changes, it shall submit a change request
to Supplier in writing. Within ten (10) Business Days after its receipt of
any such request, Supplier shall submit a detailed proposal to Purchaser
stating (a) the increase or decrease, if any, in the Purchase Price which
would result from such change, and (b) the effect, if any, upon the
Delivery Schedule or Completion Schedule by reason of such proposed change.
Purchaser shall have five (5) days from receipt of Supplier’s detailed
proposal to accept or reject in writing Supplier’s proposal in relation to the
requested change. If Purchaser agrees with Supplier’s proposal, Purchaser and
Supplier shall execute a Change Order reflecting the requested Scope Changes
and proposed adjustments, if any, in the Purchase Price and the Delivery
Schedule or Completion Schedule. In the event Purchaser disagrees with Supplier’s
proposal, Purchaser shall promptly so notify Supplier, following which the
Parties shall negotiate in good faith a solution which is satisfactory to both
Purchaser and Supplier. Should Purchaser fail to respond to Supplier in writing
within the foregoing five (5) day period, Purchaser shall be deemed to
have withdrawn its requested change.


 


8.3          No
Change. Notwithstanding anything to the contrary contained in this
Agreement, Supplier shall not be obligated to proceed with any Scope Changes
requested by Purchaser unless and until a Change Order is executed by the
Parties in relation to such change. Further, Supplier shall not be required to
implement a requested Scope Change by Purchaser if the implementation of such
change would, in Supplier’s reasonable opinion, likely impair Supplier’s
ability to achieve any of the performance guarantees, warranties or covenants
set forth in this Agreement, the OMS Agreement, and/or the Warranty Agreement.


 


8.4        Scope
Changes Caused by a Force Majeure Event. If a Force Majeure Event occurs that
materially adversely affects Supplier’s performance of all or a portion of the
sale and Delivery obligations hereunder or if such a Force Majeure Event causes
any of the Commissioning Work to be temporarily or permanently prevented,
Supplier shall be entitled to a Change Order reflecting such impact of such
Force Majeure Event, including an extension in Supplier’s time for performance
for such delay to the extent Supplier’s performance is actually delayed. In the
case of a Force Majeure Event, Supplier must notify Purchaser of Supplier’s
intent to request a Change Order (the “Notice of Intention”) within thirty (30)
Business Days of the Force Majeure Event. Supplier shall submit to Purchaser a
draft Change Order outlining, with reasonable specificity, the requested Scope
Changes within ten (10) Business Days after the Notice of Intention is
delivered to Purchaser.


 


14














 


8.5        Scope
Changes Caused by Events within the Control of Purchaser. If Purchaser, EPC
Contractor or any of Purchaser’s Contractors causes an event that materially
adversely affects Supplier’s performance of all or a portion of the sale and
Delivery obligations hereunder or if such event causes the Commissioning Work
to be temporarily or permanently prevented, Supplier shall be entitled to a
Change Order reflecting such impact of such event, including (i) an
extension in Supplier’s time for performance for such delay to the extent
Supplier’s performance is actually delayed, and (ii) an increase in the
Purchase Price with respect to such additional cost to the extent such delay is
caused solely by Purchaser, EPC Contractor or any of Purchaser’s Contractors. In
the case of such a Purchaser caused event, Supplier must notify Purchaser of
Supplier’s intent to request a Change Order (the “Notice of Intention”) within
thirty (30) Business Days of the Purchaser caused event. Supplier shall submit
to Purchaser a draft Change Order outlining, with reasonable specificity, the
requested Scope Changes within ten (10) Business Days after the Notice of
Intention is delivered to Purchaser.


 


ARTICLE 9


 


LIMITATION OF LIABILITY


 


9.1        Supplier
Not Responsible for Purchaser’s Work. Notwithstanding anything to the
contrary set forth herein, Supplier shall not have any responsibility for (a) Project
Site selection, permitting or Turbine siting within the Project Site; (b) the
design, supply or construction of Tower foundations; (c) the assembly,
erection and installation of the Turbines or the SCADA System; (d) the
design, assembly, erection and installation of any other element of the
Project, (e) obtaining rights required by the Project to sell or transmit
its electrical output, or (f) any other element of Purchaser’s Work, all
of which are expressly the responsibility of Purchaser.


 


9.2        Overall
Limitation of Liability. Notwithstanding anything to the contrary contained
in this Agreement, in no event shall Supplier, its parent company, Affiliates
and agents be liable, alone or in the aggregate, to Purchaser for any damages,
claims, demands, suits, causes of action, losses, costs, expenses and/or
liabilities related in any manner to this Agreement, the Warranty Agreement and
the OMS Agreement in excess of an amount equal to ***** percent (*****%) of the
Purchase Price, regardless of whether such liability arises out of breach of
contract, guarantee or warranty, tort, product liability, indemnity,
contribution, strict liability or any other legal theory; provided, however,
the preceding limitation of liability shall not apply to, and no credit shall
be issued against such liability for, (a) Supplier’s indemnity obligations
set forth in Section 13.1 solely as they relate to claims by third
Parties for bodily injury or property damage, or (b) the fraud or willful
misconduct of Supplier.


 


9.3        Consequential
Damages. Notwithstanding anything to the contrary contained in this
Agreement and except as set forth in the last sentence of this Section,
Purchaser and Supplier waive all claims against each other (and against each
other’s parent company, Affiliates, contractors, subcontractors, consultants,
vendors, suppliers and agents) for any consequential, incidental, indirect,
special, exemplary or punitive damages (including, but not limited to, loss of
actual or anticipated profits, revenues or product; loss by reason of shutdown
or non-operation; increased expense of operation, borrowing or financing; loss
of use or productivity; or increased cost of capital), and regardless of
whether any such claim arises out of breach of contract or warranty, tort,
product liability, indemnity, contribution, strict liability or any other legal
theory. Any


 


15

















 


consequential,
incidental, indirect, special, exemplary or punitive damages incurred by
Supplier or Purchaser in relation to a third Party shall, for all purposes of
this Agreement, be deemed consequential, incidental, indirect, special,
exemplary or punitive damages in relation to any claim brought by Supplier or
Purchaser against the other Party to this Agreement. Any liquidated damages
payable by Supplier under this Agreement shall not be deemed consequential,
incidental, indirect, or special damages for purposes of this Agreement.


 


ARTICLE 10


 


TITLE AND RISK OF LOSS; INSURANCE


 


10.1           Title to Supply
Items. Title to any Supply Item shall transfer to the Purchaser upon (i) the
Delivery of such Supply Item to its Designated Delivery Location and (ii) Purchaser’s
payment of and Supplier’s receipt of, the applicable Progress Payment.


 


10.2           Risk of Loss.
Supplier shall bear the risk of loss and damage with respect to any Supply Item
(including each individual Major Turbine Component) until Delivery of such
Supply Item to its Designated Delivery Location. In performing the
Commissioning Work, Supplier shall be deemed a contractor of Purchaser
performing the Services on Supply Items then owned by Purchaser. Upon the
Delivery of any Supply Item to its Designated Delivery Location, care, custody
and control of, and risk of loss or damage to, such Supply Item shall thereupon
transfer to the Purchaser.


 


10.3          Insurance. Supplier
and Purchaser shall maintain the following insurance while this Agreement is in
effect:


 


10.3.1 Supplier
Insurance.


 


Supplier shall
carry and maintain or cause to be carried and maintained, at all times during
the Term of this Agreement, insurance coverage with limits as set forth in this
Section (the “Supplier Insurance”).


 


Marine Cargo Insurance


 


All
property and interests of every kind and description (including materials,
equipment, machinery and spares) intended for the Project or subsequent
operations while in transit by land, air and/or sea. All Risks of physical loss
or damage from a cause not excluded but including war, strikes, riots and civil
commotions and terrorism while in transit, on a continuous open cover basis.
Increased cost of working - the additional expenditure necessarily and
reasonably incurred for the purpose of avoiding or reducing delay which,
without such expenditure would have taken place.


 


Property


 


At
all times the Supplier’s factory premises, plant, machinery, raw materials and
finished stocks all related to and comprising the Project under a property
insurance in an amount equal to the full replacement value of the above named
items for “all risks” of physical loss or damage including, but not limited to,
coverage for earth movement,


 


16

















 


flood,
windstorm, earthquake, sabotage, terrorism, riots, civil commotion, testing,
boiler and machinery, transit and off-site storage. The policy may contain
separate sub limits and deductibles subject to insurance company underwriting
guidelines. Deductibles under the policy shall not exceed $100,000 per
occurrence, except for deductibles for natural catastrophe peril, which shall
not exceed five percent (5%) of the insured loss


 


Increased
cost of working - the additional expenditure necessarily and reasonably
incurred for the purpose of avoiding or reducing delay which, without such
expenditure would have taken place.


 


Workers Compensation


 


Coverage
shall comply with any statutory obligation imposed by Workers Compensation,
Occupational Disease Laws, or similar laws, including where applicable, the
United States Longshoremen’s and Harbor Workers’ Act, the Federal Employers’
Liability Act and the Jones Act. Employers’ Liability insurance shall have
limits of not less than $1,000,000 per accident, $1,000,000 disease-policy
limit and $1,000,000 disease-each employee.


 


Commercial General Liability


 


Insurance
providing coverage for bodily injury, property damage and personal/advertising
injury with a combined single limit of not less than $1,000,000 per occurrence
and $2,000,000 aggregate. The policy shall include contractual liability and
any testing operations coverage.


 


a.                        Automobile Liability - Insurance for owned, non-owned and
hired automobiles with a limit of not less than $1,000,000 per occurrence.


 


b.                        Excess  liability
- Insurance with a minimum limit of $10,000,000 per occurrence and
annual aggregate.


 


c.                         Evidence and Scope of Insurance - Supplier
shall provide Purchaser with a copy of insurance original certificates
evidencing the insurance coverages required and shall provide replacement
certificates of insurance within five (5) days of any renewal of the
required insurance.


 


All such insurance policies shall:


 


(i) name
Purchaser for their respective rights and interests in respect of the Project
as additional insured (except in the case of worker’s compensation insurance);


 


(ii) provide
Purchaser with 30 days’ prior written notice of non-renewal, cancellation of,
or significant modification to, any of such policies (except that such notice
period will be 10 days in case of non-payment of premiums); and


 


(iii) the
insurance certificates provided to Purchaser shall indicate that the insurance
policies have been endorsed as noted above. All


 


17

















 


policies
shall be written by one or more insurance companies authorized to do business
in USA and be rated BBB+ or higher by A.M. Best.


 


Term and Modification of Insurance


 


If
the designated coverage, or relatively comparable coverage, are unavailable on
reasonable commercial terms, Supplier will provide Purchaser detailed
information as to the maximum amount of available coverage that it is able to
purchase and will be required to obtain Purchaser’s consent as to the adequacy
of said coverage under the circumstances at the time, which consent shall not be
unreasonably withheld or delayed.


 


10.3.2  Purchaser Insurance.


 


Purchaser shall
carry and maintain or cause to be carried and maintained, at all times during
the Term of this Agreement, insurance coverage with limits as set forth in this
Section.


 


Builder’s All Risk Insurance


 


At
all times during construction, the Purchaser’s Project will be under a builder’s
all risk insurance in an amount equal to the full replacement value of the
Project for “all risks” of physical loss or damage including, but not limited
to, coverage for earth movement, flood, windstorm, earthquake, sabotage,
terrorism, riots, civil commotion, testing, boiler and machinery, transit and
off-site storage. The policy may contain separate sub limits and deductibles
subject to insurance company underwriting guidelines. Deductibles under the
policy shall not exceed $100,000 per occurrence, except for deductibles for
natural catastrophe peril, which shall not exceed five percent (5%) of the
insured loss


 


Increased
cost of working - the additional expenditure necessarily and reasonably
incurred for the purpose of avoiding or reducing delay which, without such
expenditure would have taken place.


 


Workers Compensation


 


Coverage
shall comply with any statutory obligation imposed by Workers Compensation,
Occupational Disease Laws, or similar laws, including where applicable, the
United States Longshoremen’s and Harbor Workers’ Act, the Federal Employers’
Liability Act and the Jones Act. Employers’ Liability insurance shall have
limits of not less than $1,000,000 per accident, $1,000,000 disease-policy
limit and $1,000,000 disease-each employee.


 


18

















 


Commercial General Liability


 


Insurance
providing coverage for bodily injury, property damage and personal/advertising
injury with a combined single limit of not less than $1,000,000 per occurrence
and $2,000,000 aggregate. The policy shall include contractual liability and
any testing operations coverage.


 


a.                 Automobile Liability - Insurance for owned,
non-owned and hired automobiles with a limit of not less than $1,000,000 per
occurrence.


 


b.                 Excess liability - Insurance with a minimum
limit of $10,000,000 per occurrence and annual aggregate.


 


c.                  Evidence and Scope of Insurance


 


Purchaser
shall provide Supplier with a copy of insurance original certificates
evidencing the insurance coverages required and shall provide replacement
certificates of insurance within five (5) days of any renewal of the
required insurance.


 


All such insurance
policies shall:


 


(i) name Supplier for their respective rights and
interests in respect of the Project as additional insured (except in the case
of worker’s compensation insurance);


 


(ii)provide Supplier with 30 days’ prior written
notice of non-renewal, cancellation of, or significant modification to, any of
such policies (except that such notice period will be 10 days in case of
non-payment of premiums); and


 


(iii)The insurance certificates provided to Supplier
shall indicate that the insurance policies have been endorsed as noted above.
All policies shall be written by one or more insurance companies authorized to
do business in USA and be rated BBB+ or higher by A.M. Best.


 


Term and Modification of Insurance


 


If
the designated coverage, or relatively comparable coverage, are unavailable on
reasonable commercial terms, Purchaser will provide Supplier detailed
information as to the maximum amount of available coverage that it is able to
purchase and will be required to obtain Supplier’s consent as to the adequacy
of said coverage under the circumstances at the time, which consent shall not
be unreasonably withheld or delayed.


 


19

















 


ARTICLE 11


 


REPRESENTATIONS AND WARRANTIES OF
SUPPLIER


 


Supplier hereby
represents and warrants to Purchaser as follows:


 


11.1           Due
Organization: Good Standing. Supplier is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
and qualified to conduct business in the states where it does business.


 


11.2           Due
Authorization. The execution, delivery and performance of this Agreement by
Supplier have been duly authorized by all necessary corporate action on the
part of Supplier and do not and will not require the consent of any trustee or
holder of any indebtedness or other obligation of Supplier or any other Party
to any other agreement with Supplier.


 


11.3           Execution
and Delivery. This Agreement has been duly executed and delivered by
Supplier. This Agreement constitutes the legal, valid and binding obligation of
Supplier, enforceable against Supplier in accordance with its terms, except to
the extent that its enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the rights of
creditors generally or by principles of equity.


 


11.4           Governmental
Approvals. No governmental authorization, approval, order, license, permit,
franchise or consent, and no registration, declaration or filing with any
Governmental Authority is required on the part of Supplier in connection with
the execution, delivery and performance of this Agreement, except those which
have already been obtained or which Supplier anticipates will be timely
obtained in the ordinary course of performance of this Agreement.


 


11.5           Supply
Items: Services. The Supply Items and the SCADA System to be delivered
hereunder shall be designed and fit for the purpose of generating electric
power when operated in accordance with the Turbine Specifications, the OMS
Manual, Prudent Electrical Industry Practices and Prudent Wind Industry
Practices. The Supply Items and SCADA System shall be new and unused and shall
be free from Defects and free from defects in title. The Services shall be
performed in a competent, diligent manner in accordance with Prudent Wind Industry
Practices, Supplier’s manufacturers’ written requirements and applicable
Governmental Requirements.


 


ARTICLE 12


 


REPRESENTATIONS AND WARRANTIES OF
PURCHASER


 


Purchaser
represents and warrants to Supplier as follows:


 


12.1           Due
Organization: Good Standing: Qualified To Do Business. Purchaser is a
limited liability company duly organized, validly existing and in good standing
under the laws of the State of Delaware, and qualified to conduct business in
the states where it does business.


 


20

















 


12.2           Due
Authorization. The execution, delivery and performance of this Agreement by
Purchaser have been duly authorized by all necessary action on the part of
Purchaser in accordance with Purchaser’s organizational documents and do not
and will not require the consent of any trustee or holder of any indebtedness
or other obligation of Purchaser or any other Party to any other agreement with
Purchaser.


 


12.3           Execution
and Delivery. This Agreement has been duly executed and delivered by
Purchaser. This Agreement constitutes the legal, valid and binding obligation
of Purchaser, enforceable against Purchaser in accordance with its terms,
except to the extent that its enforceability may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
rights of creditors generally or by principles of equity.


 


12.4           Governmental
Approvals. No governmental authorization, approval, order, license, permit,
franchise or consent, and no registration, declaration or filing with any
Governmental Authority is required on the part of Purchaser in connection with
the execution, delivery and performance of this Agreement, except those which
have already been obtained or which Purchaser anticipates will be timely
obtained in the ordinary course of performance of this Agreement.


 


12.5           Project
Site. On or prior to the date that Supplier is to provide any services
relating to the Project at the Project Site, Purchaser shall have obtained the
right and authority to have such work performed on the Project Site. To the
knowledge of Purchaser, after the completion of reasonable due diligence on the
Project Site, the Project Site is free of all hazardous or dangerous materials
or substances. All information concerning the Project Site and the wind flow
across the Project Site heretofore delivered to Supplier by Purchaser is true,
complete and correct in all material respects.


 


ARTICLE 13


 


MUTUAL INDEMNITY


 


13.1           Mutual
Indemnity. Each of Supplier and Purchaser agree to defend, indemnify and
hold each other, and each other’s lenders, parent companies, Affiliates,
officers, directors, agents and employees, harmless from and against any
claims, losses, damages and liabilities (including, but not limited to,
reasonable attorneys’ fees and court costs, but excluding consequential
damages) on account of any claim by a third Party for bodily injury or property
damage against the indemnified Party to the extent caused by the negligent act
or omission, or willful misconduct of, or breach of this Agreement by, the
indemnifying Party or the indemnifying Party’s employees, contractors,
subcontractors or agents, in connection with the performance of their
respective obligations under this Agreement.


 


ARTICLE 14


 


DEFAULT; CURE;
REMEDIES


 


14.1           Default
by Supplier. Supplier shall be in default under this Agreement should any
one or more of the following events or conditions arise or exist:


 


21

















 


(i)                               Supplier
becomes insolvent, or generally does not pay its debts as they become due, or
admits in writing its inability to pay its debts, or makes a general assignment
for the benefit of creditors; or


 


(ii)                            Insolvency,
receivership, reorganization, or bankruptcy proceedings are commenced by or
against Supplier and, in the case of any such involuntary proceeding, that is
not dismissed or stayed within sixty (60) days after it is commenced; or


 


(iii)                         Supplier fails, for any
reason, other than failure of Purchaser to make payments to Supplier when obligated
in accordance with this Agreement, to make any undisputed payments required to
be made by Supplier to Purchaser, which failure continues for ten (10) Business
Days after notice of such non-payment, or


 


(iv)                        Supplier
is in material default of any term or provision of this Agreement or has
materially failed to perform its obligations under this Agreement, and such
breach or failure continues for thirty (30) Business Days following receipt of
written notice from Purchaser to cure such breach or failure; provided,
however, if such failure cannot with due diligence be remedied by Supplier
within such thirty (30) Business Days period, and Supplier shall have
diligently prosecuted the remedying of such failure within such thirty (30)
Business Days, such period shall be extended by such additional time period as
may be reasonably required by Supplier to cure such failure.


 


14.2           Purchaser’s
Remedies. In the event Supplier is in default pursuant to Section 14.1,
and said default is not timely cured within the time periods set forth above,
Purchaser, in addition to those rights and remedies that may be available to
Purchaser at law or in equity, and subject to Section 9.2 of this
Agreement, shall have the right to terminate this Agreement by written notice
to Supplier; provided however, that amounts applicable to Supply Items
delivered or services performed by Supplier through the date of termination of
this Agreement shall be paid by Purchaser to Supplier.


 


14.3           Default
by Purchaser. Purchaser shall be in default under this Agreement should any
one or more of the following events or conditions arise or exist:


 


(i)                               Purchaser
or Guarantor becomes insolvent, or generally does not pay its debts as they
become due, or admits in writing its inability to pay its debts, or makes a
general assignment for the benefit of creditors; or


 


(ii)                            Insolvency,
receivership, reorganization or bankruptcy proceedings are commenced by or
against Purchaser or Guarantor and, in the case of any such involuntary
proceeding, that is not dismissed or stayed within sixty (60) days after it is
commenced; or


 


(iii)                         Purchaser fails to timely pay
to Supplier any required payment under this Agreement when due, including
failure to timely provide any Down Payment or any Progress Payment, which
failure continues for ten (10) days after written notice of failure to
make payment has been received by Purchaser from Supplier; or


 


22

















 


(iv)                        Purchaser
fails to perform any material term or provision of this Agreement, including
failure to timely provide the Guaranty to Supplier, and such failure continues
for thirty (30) Business Days following receipt of written notice from Supplier
to cure such failure; provided, however, if such failure cannot with due
diligence be remedied by Purchaser within such thirty (30) Business Day period,
and Purchaser shall have diligently prosecuted the remedying of such failure
within such thirty (30) Business Days, such period shall be extended by such
additional time period as may be reasonably required by Purchaser to cure such
failure; or


 


(v)                           The
revocation or other termination of the Guaranty by Guarantor, or the breach by
Guarantor of any material term or provision of the Guaranty, including any
payment obligation thereunder, which breach continues for a period of ten (10) days
after written notice of such breach has been received by Guarantor from
Supplier.


 


14.4                 Supplier’s
Remedies. In the event that Purchaser is in default pursuant to Section 14.3,
and said default is not timely cured within the time periods set forth above,
Supplier, in lieu of any rights and remedies that may be available to Supplier
at law or in equity, shall have the right to terminate this Agreement by
written notice to Purchaser, which termination shall be effective upon delivery
of Supplier’s notice to Purchaser. Within three (3) Business Days of the
effective date of such termination, Purchaser shall pay to Supplier the
liquidated damages set forth on the termination schedule attached hereto as
Exhibit G (“Termination Schedule”), which shall constitute Supplier’s
exclusive remedy, and Supplier shall have no right to damages or compensation
for such termination other than payment of the liquidated damages set forth on
the Termination Schedule.


 


14.5                 Cancellation
Due to a Force Majeure Event. If Supplier is entirely prevented from
performing its obligations hereunder for a period of one-hundred eighty (180)
consecutive days as a result of the occurrence of a Force Majeure Event
suffered by Supplier, then Supplier may cancel, without additional liability,
any then remaining unperformed portion of this Agreement, upon not less than
thirty (30) Business Days’ prior written notice to the Purchaser, provided,
however, that nothing in this Section 14.5 shall relieve or excuse
Supplier from its obligations under Article 7 of this Agreement in
respect of the occurrence of a Force Majeure Event or relieve either Party from
any payment obligation that has accrued as of the date of cancellation or prior
thereto; provided further, however, that any payment obligations of Purchaser
shall be reduced by the amount of funds received by Supplier, if any, in
connection with the resale of any Turbines or Turbine components sold that are
applicable to such payment obligations of Purchaser, and, if following such
reduction, Purchaser is owed a refund of some portion of the Purchase Price
from Supplier, Supplier shall refund to Purchaser the applicable amount of
Purchase Price previously paid to Supplier within thirty (30) days of such termination.


 


14.6                 Termination
*****. Purchaser shall have the right, only at any time up to, and not
later than, ***** prior to the scheduled date for Delivery of the first Major
Turbine Component to be Delivered under this Agreement pursuant to the Delivery
Schedule, upon the occurrence of a *****, to terminate all of the Turbine
Supply Documents upon ***** prior written notice to Supplier. *****


 


23

















 


***** Upon written notice
from Purchaser, Supplier shall use commercially reasonable efforts to provide
Purchaser with ***** reasonably requested by Purchaser regarding *****. In the
event that the Parties disagree whether a ***** has occurred, the matter shall
be resolved in accordance with the dispute resolution procedures set forth in Article 15
of this Agreement. If a ***** occurs prior to ***** prior to the scheduled
Delivery Date of the first Major Turbine Component, such ***** shall not exist
in the Turbines to be Delivered in accordance with this Agreement.


 


14.7                 Termination
for Convenience. The Purchaser shall have the right to terminate this
Agreement for convenience with respect to any Turbine until title to such
Turbine has passed to Purchaser. Such termination shall be effective upon the
later to occur of (i) delivery to Supplier of written notice of
termination and (ii) receipt by Supplier of liquidated damages in the
amount on a per Turbine basis with respect to such Turbine in accordance with
the Termination Schedule attached to this Agreement as Exhibit G.


 


14.8                 Surviving
Obligations. Cancellation or expiration of all or any portion of this
Agreement (a) shall not relieve Purchaser of its obligations with respect
to the confidentiality of Supplier’s proprietary information as set forth in Section 4.5
of this Agreement, or either Party of its confidentiality obligations as set
forth in Section 16.9 of this Agreement, (b) shall not relieve
either Party of any obligation hereunder which expressly or by implication
survives termination hereof, and (c) except as otherwise provided in any
provision of this Agreement expressly limiting the liability of either Party,
shall not relieve either Purchaser or Supplier of any obligations or
liabilities for loss or damage to the other Party arising out of or caused by
acts or omissions of such Party prior to the effectiveness of such termination
or arising out of such termination, and shall not relieve Supplier of its
obligations as to portions of the items supplied or other services hereunder
already supplied or performed or of obligations assumed by Supplier prior to
the date of termination. This Article shall survive the termination or
expiration of this Agreement.


 


ARTICLE 15


 


DISPUTE RESOLUTION


 


15.1           Procedure. In
the event a dispute, controversy or claim (herein, a “dispute”) arises between
Purchaser and Supplier relating to this Agreement, the aggrieved Party shall
promptly provide written notification of the dispute to the other Party within
ten (10) days after such dispute arises and the Parties shall resolve such
dispute as provided herein:


 


15.1.1 Executives Meeting. A meeting shall be
held between the Parties, attended by representatives of the Parties with
decision-making authority regarding the dispute, to attempt in good faith to
negotiate a resolution of the dispute. Such meeting shall be held in
Carpinteria, California within thirty (30) days after a notice of dispute has
been delivered under Section 15.1 above.


 


24














 


15.1.2  Independent
Engineer’s Decision. If the dispute involves a technical issue, within ten (10) days
after such meeting, the Parties have not resolved the dispute, either Party
shall submit the dispute to the Independent Engineer for a non-binding determination,
together with such information in support of their position as may be relevant,
which information will simultaneously be sent to the other Party. The
Independent Engineer may hold separate meetings with each Party or call a joint
meeting of the Parties, to be held in Carpinteria, California. The Independent
Engineer shall, within thirty (30) days after such request for a determination,
issue a non-binding decision. Any Party which does not wish to comply with such
decision shall promptly provide written notification of its intention to the
other Party within five (5) days of such decision. The Parties shall meet
in Chicago, Illinois within twenty (20) days of such notice to attempt, in good
faith, to negotiate a final resolution to the dispute. Any Party which does not
wish to comply with such decision shall within ten (10) days after the
date of such meeting submit the dispute to arbitration within twenty (20) days
after the date of such decision to arbitration in accordance with Section 15.1.3
below. The Parties shall share equally the costs of the Independent Engineer.


 


15.1.3  Arbitration.


 


(a)       If the Parties are not
successful in resolving a dispute, controversy or claim pursuant to Sections
15.1.1 and 15.1.2. above, then such dispute shall be resolved
through binding arbitration to take place in Chicago, Illinois. The Parties
agree to conduct all arbitration proceedings in accordance with the Commercial
Arbitration Rules of the American Arbitration Association. This Section 15.1.3
is governed by the Federal Arbitration Act.


 


(b)       A Party desiring to
submit to arbitration any such dispute, controversy or claim shall furnish its
demand for arbitration in writing to the other Party or Parties thereto, which
demand shall contain a brief statement of the matter in controversy, as well as
a list containing the names of three (3) suggested arbitrators from the
list of arbitrators maintained by the American Arbitration Association (the “AAA
List”) from which list, or from other sources, all of the Parties shall choose
one (1) mutually acceptable arbitrator. If the Parties are unable to agree
upon the identity of a single arbitrator, within ten (10) days from the
receipt of such demand, the Purchaser and the Supplier shall each
(collectively, the “Arbitrating Parties”), within a period of five (5) additional
days, name from the AAA List one (1) arbitrator by written notice to the
other Arbitrating Party or Parties. Within ten (10) days after this
notice, the two (2) arbitrators so named shall choose a third arbitrator.
If any Arbitrating Party fails to name an arbitrator within the specified five (5) day
period or if the two arbitrators chosen by the Arbitrating Parties fail to
select a third arbitrator within the ten (10) day period, then either
Arbitrating Party, on behalf of and on notice to the other Arbitrating Party or
Parties, may request appointment by the American Arbitration Association in
accordance with its rules then prevailing of the required additional
arbitrator or arbitrators so that there shall be a panel of three (3) arbitrators.
If the American Arbitration Association should fail to appoint the necessary
arbitrator or arbitrators within fifteen (15) days after such request is made,
then either Arbitrating Party may apply, on notice to the other Arbitrating
Party or Parties, to a court of competent jurisdiction for the appointment of
such necessary additional arbitrators. Each of the arbitrator or arbitrators
chosen or appointed pursuant to this Section 15.1.3(b) shall
be a person having at least ten (10) years experience in the United States
in the legal profession and shall


 


25

















 


not be a past or present
officer, director or employee of, or have any material interest in, any
Arbitrating Party or any Affiliate of an Arbitrating Party. All discovery,
including the right to take depositions and interrogatories, shall be permitted
in the time and manner provided by the then applicable Federal Rules of
Civil Procedure. The Arbitrating Parties shall be entitled to reasonable
discovery prior to the arbitration hearing, and the arbitrator or arbitrators,
as the case may be, shall have the power upon application of any Arbitrating
Party to make all appropriate orders for discovery from the other Arbitrating
Party, including discovery of documents, responses to interrogatories, and
depositions. The scope, time and manner of discovery, including all document
discovery, are to be in accordance with the U.S. Federal Rules of Civil
Procedure. Notwithstanding the foregoing, discovery allowed each of the
Arbitrating Parties shall not exceed: (i) five (5) party depositions;
(ii) three (3) nonparty depositions; (iii) three (3) depositions of
any experts selected to give opinions in the arbitration (as well as the production
of any documents relied upon by such experts); and (iv) fifteen (15)
interrogatories (with each subpart counted as a separate interrogatory).
Discovery shall not include requests for admissions. No deposition shall last
more than two (2) days in length. Further, all discovery must, without
exception, be completed within one hundred twenty (120) days from the date the
arbitration panel is appointed. Any documents that are not produced to the
other Arbitrating Party prior to the termination of this 120-day discovery
period may not be offered into evidence at the arbitration hearing unless such
production shall not prejudice the non-producing Arbitrating Party as
determined by the arbitrator or arbitrators, as the case may be. Likewise, any
witnesses who have not been produced for deposition, despite a request from the
other side, may not testify or submit affidavits at the arbitration hearing.


 


(c)       The arbitrator or
arbitrators, as the case may be, shall render his, her or their decision, in
the latter case upon the concurrence of at least two (2) of their number,
as soon as possible but no later than thirty (30) days after the conclusion of
any hearings before such arbitrator or arbitrators, as the case may be, unless
such 30-day period is extended by the arbitrator or arbitrators, as the case
may be. The decision and award shall in either case be in writing and
counterpart copies of such decision shall be delivered to each of the
Arbitrating Parties. Such decision shall be based solely upon the written
arguments and contentions, evidence and legal authorities, submitted by each
Arbitrating Party. In rendering such decision and award, the arbitrator shall
not add to, subtract from or otherwise modify the provisions of this Agreement.
Any award rendered shall be final and conclusive upon the parties and a
judgment on any such award may be entered in any court having jurisdiction,
state or federal, having jurisdiction. No arbitration proceeding shall be
commenced after the date when institution of legal or equitable proceedings
based upon such subject matter would be barred by the applicable statute of
limitations. Notwithstanding anything to the contrary contained in this section
or elsewhere in this Agreement, provisional injunctive or other provisional equitable
relief may be sought by the parties without first submitting the subject
dispute to arbitration so long as injunctive relief is otherwise warranted by
applicable law.


 


15.2 Qualifications
of Arbitrators; Expenses.


 


(a)       The arbitrators in the
arbitration proceeding provided for in this Article 15 shall be
individuals experienced in the energy construction industry and competent to
pass on the matter presented for arbitration.


 


26

















 


(b)       Supplier,
on the one hand, and Purchaser, on the other, shall share equally the
compensation and expenses of the arbitrators as well as all fees imposed by the
AAA. Supplier and Purchaser shall be responsible for their own costs and legal
fees, if any. Notwithstanding the foregoing, a majority of the arbitrators
shall be empowered to award the prevailing Party its costs, expenses and/or
legal fees.


 


15.3    Performance During
Dispute. While any controversy, dispute or claim arising out of or relating
to this Agreement is pending, Purchaser and Supplier shall continue to perform
their obligations hereunder notwithstanding such controversy, dispute or claim.


 


15.4    Consolidation. No
arbitration arising under this Agreement shall include, by consolidation,
joinder or any other manner, any person or entity not a Party to this
Agreement, unless (a) such person or entity is substantially involved in a
common question of fact or law, (b) the presence of such person or entity
is required if complete relief is to be accorded in the arbitration, and (c) such
person or entity has consented to such inclusion.


 


15.5    Language. All
arbitration proceedings shall be conducted in the English language.


 


ARTICLE 16


 


GENERAL PROVISIONS


 


16.1    Waiver. No delay or
omission by the Parties hereto in exercising any right or remedy provided for
herein shall constitute a waiver of such right or remedy nor shall it be
construed as a bar to or waiver of any such right or remedy on any future
occasion.


 


16.2    Successors and Assigns.
This Agreement shall be binding upon and shall inure to the benefit of the
successors and permitted assigns of Supplier and Purchaser. Except as set forth
herein, neither Supplier nor Purchaser may assign, convey or transfer this
Agreement, in whole or in part, except upon the prior written consent of the
other Party hereto, which consent shall not be unreasonably withheld, and any
such purported transfer or assignment shall be null and void. Notwithstanding
any permitted assignment hereunder, the assignor shall remain liable to the other
Party for all duties and responsibilities hereunder unless affirmatively
recited by the other Party.


 


16.3    Permitted Assignments.
Notwithstanding Section 16.2 above, (i) either Party may
transfer or assign its rights, benefits and obligations under this Agreement to
an Affiliate; provided, that if requested by Purchaser, Supplier shall execute
and deliver a guaranty of the performance hereunder by such an assignee, (ii) Purchaser
may assign its rights, benefits and obligations under this Agreement to any purchaser
of the Project; provided, that Purchaser may not transfer or assign this
Agreement in whole or in part to a wind turbine design or manufacturing
competitor of Supplier without the prior written consent of Supplier, which
consent may be withheld in Supplier’s sole discretion and which may be
conditioned upon the creditworthiness of the purchaser, (iii) Supplier is
authorized to subcontract any portion of its duties under this Agreement to a
third party or to delegate its obligations hereunder, in the ordinary course of
its business, without reducing the scope of Supplier’s undertakings,
obligations, and commitments to Purchaser, provided that Supplier agrees that
it will not use any supplier for any Major Turbine Components not listed on Exhibit H
without Purchaser’s advance written consent, such consent not to be
unreasonably withheld,


 


27

















 


conditioned or delayed,
and (iv) a Party, without the consent of the other Party, may assign its
interest in this Agreement to a lender, collateral trustee, security trustee or
similar entity as collateral security for any financing entered into by the
assigning Party, including a lease financing. The non-assigning Party shall,
upon fifteen (15) days’ prior written request from the assigning Party, execute
a consent containing customary terms and conditions, to any such collateral
assignment. Further, notwithstanding Section 16.2 above, Purchaser
shall have the right to assign no less than all of its rights, duties and
obligations under the Turbine Supply Documents to any third party, subject to,
and conditioned upon, the prior written consent of Supplier, which shall not be
unreasonably withheld, conditioned, or delayed; provided however that any such
assignment is conditioned upon the receipt of a guarantee for the benefit of
Supplier of the performance of the contract obligations, including payment
security, in a form acceptable to Supplier, in its sole and absolute
discretion. Any such assignment to a third party also shall be subject to the
following: (i) prior to the effectiveness of such assignment, the third
party assignee shall agree to revisions to the Turbine Supply Documents as
determined by Supplier to be reasonably necessary, to effect the purchase and
installation of the Turbines by the third party assignee at a project site to
be determined between Supplier and any such third party assignee, (ii) the
third party assignee shall assume all of the duties, obligations, restrictions
and covenants of Purchaser under the Turbine Supply Documents, as revised, (iii) any
monies or other consideration received by, or otherwise payable to, Purchaser
from the third party assignee in connection with such assignment, in excess of
the Down Payment and any Progress Payments actually paid by Purchaser to
Supplier, other than the reasonable actual documented expenses incurred by
Purchaser in connection with the assignment of the Turbine Supply Documents to
the third party, shall be paid to Supplier and (iv) Purchaser shall pay to
Supplier all of Supplier’s costs associated with such assignment from Purchaser
to the third party assignee, including but not limited to all of Supplier’s
costs (including reasonable legal fees) incurred in connection with the
revision of the Turbine Supply Documents, within thirty (30) days of receipt of
an applicable invoice from Supplier.


 


16.4    Notices.


 


(a)       Any
notice required or authorized to be given hereunder or any other communications
between the Parties provided for under the terms of this Agreement shall be in
writing (unless otherwise provided) and shall be served personally or by
reputable express courier service or by facsimile transmission addressed to the
relevant Party at the address stated below or at any other address notified by
that Party to the other as its address for service. Any notice so given
personally shall be deemed to have been served on delivery, any notice so given
by express courier service shall be deemed to have been served two (2) Business
Days after the same shall have been delivered to the relevant courier, and any
notice so given by facsimile transmission shall be deemed to have been served
on dispatch. As proof of such service it shall be sufficient to produce a
receipt showing personal service, the receipt of a reputable courier company
showing the correct address of the addressee or an activity report of the
sender’s facsimile machine showing the correct facsimile number of the Party on
whom notice is served and the correct number of pages transmitted.


 


(b)       The Parties’ addresses for service are:


 


	
   

  	
  To Purchaser:

  	
  UPC Wind Acquisition V,
  LLC

  
	
   

  	
  c/o UPC Wind
  Management, LLC

  
	
   

  	
  85 Wells Ave., Suite 305

  



 


28

















 


	
   

  	
  Attn:

  	
  Newton, MA 02459

  
	
   

  	
   

  	
  General Counsel

  
	
   

  	
   

  	
  Facsimile: 

  	
  (617) 964-3342

  
	
   

  	
   

  	
  Telephone:

  	
  (617) 964 3340

  
	
   

  	
   

  	
   

  
	
   

  	
  To Supplier:

  	
  Clipper Turbine Works, Inc.

  
	
   

  	
   

  	
  6305 Carpinteria
  Avenue, Suite 300

  
	
   

  	
   

  	
  Carpinteria, California
  93013

  
	
   

  	
   

  	
  Attn:

  	
  General Counsel

  
	
   

  	
   

  	
  Facsimile:

  	
  805.899.1115

  
	
   

  	
   

  	
  Telephone:

  	
  805.690.3275

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
  Chadbourne &
  Parke LLP

  
	
   

  	
   

  	
  300 South Grand Avenue,
  Suite 3300

  
	
   

  	
   

  	
  Los Angeles, CA 90071

  
	
   

  	
   

  	
  Attn: 

  	
  Edward W. Zaelke

  
	
   

  	
   

  	
  Facsimile:

  	
  213.622.9865

  
	
   

  	
   

  	
  Telephone:

  	
  213.892.1000

  



 


16.5   Governing Law. This Agreement and all
matters arising hereunder or in connection herewith shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to conflicts of law principles.


 


16.6   Amendments. This Agreement may be modified
or amended only by an instrument in writing signed by the Parties hereto.


 


16.7   Attachments Incorporated. The preamble and
recitals of this Agreement, and the Exhibits attached hereto, are hereby
incorporated into and made a part of this Agreement.


 


16.8   Entire Agreement. The terms and conditions
set forth herein, together with those set forth on all Exhibits attached
hereto, constitute the complete statement of the agreement between Supplier and
Purchaser relating to the subject matter hereof. No prior statement or
correspondence shall modify or affect the terms and conditions hereof. Prior
representations, promises, warranties or statements by Supplier or Purchaser,
or by any agent or employee of Supplier or Purchaser, that differ in any way
from the terms and conditions hereof shall be given no effect.


 


16.9   Confidentiality. Each Party agrees to keep
the terms and provisions of this Agreement and all materials and information
that each receives pursuant hereto or in connection herewith or in connection
with the Project in the strictest confidence and not to disclose any of the
foregoing to any party other than the respective lenders, investors, attorneys,
accountants, Affiliates, officers and directors of each Party or as such Party
may be required by law, court order or in any litigation to disclose. This Section 16.9
shall survive the termination of this Agreement. Notwithstanding the foregoing,
Supplier shall be entitled to announce by press release or other means that it
has agreed to furnish the Turbines for the Project. The Parties agree that,
with respect to press releases concerning the Project, they will endeavor to
cooperate and share information with one another so that the Parties are
identified, to the extent practicable in press releases regarding the


 


29

















 


Project. Supplier and
Purchaser will each provide copies of all press releases issued regarding the
Project to the other. Furthermore, the restrictions of this Section 16.9
shall not prohibit or restrict Supplier from using or disclosing the availability
and performance data from the Project in connection with its sales, maintenance
and other internal purposes; provided, however, that no specific reference
shall be made to the Project in connection with the disclosure of such data.


 


16.10   Counterparts. This Agreement may be
executed by the Parties in one or more counterparts, all of which taken
together, shall constitute one and the same instrument. The exchange of copies
of this Agreement and of signature pages by facsimile transmission shall
constitute effective execution and delivery of this Agreement as to the Parties
and may be used in lieu of the original Agreement for all purposes (and such
signatures of the parties transmitted by facsimile shall be deemed to be their
original signatures for all purposes).


 


16.11   English Language Documents. Any document,
manual, certificate or notice required or authorized to be given hereunder for
the operation of the Project shall be provided in the English language.


 


16.12   Severability. In case any provision in
this Agreement is held to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not be affected.


 


16.13   Headings. The headings and captions used
in this Agreement are inserted for reference and convenience only and the same
shall not limit or construe the sections, articles or paragraphs to which they
apply or otherwise affect the interpretation thereof.


 


16.14   Agreement Revisions. Following the
execution of this Agreement by the Parties, if either Party requests a change
to the Agreement in order to (i) correct any inconsistency contained
within the Agreement or among the Turbine Supply Documents or (ii) clarify
any ambiguities in the Agreement to reflect the intent of the Parties, then the
Parties agree to work in good faith to amend the language of the Agreement to
conform to any such requested change.


 


30

















 


IN
WITNESS WHEREOF, this Agreement has been executed and delivered by the duly authorized
representatives of Purchaser and Supplier as of the date first written above.


 


 


	
   

  	
  CLIPPER TURBINE WORKS,
  INC.,

  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Gates

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Robert Gates

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  Sr. Vice Pres

  



 


Upc 2011


 


[Signature Page to
Turbine 

Supply Agreement]


 

















 


IN
WITNESS WHEREOF, this Agreement has been executed and delivered by the duly
authorized representatives of Purchaser and Supplier as of the date first
written above.


 


 


	
   

  	
  UPC WIND ACQUISITION V,
  LLC,

  a Delaware limited liability company

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Gaynor

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Paul Gaynor

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  President

  



 


Upc 2011


 


[Signature Page to
Turbine 

Supply Agreement]


 

















 


APPENDIX I


 


DEFINITIONS


 


“Additional
Cost Event” means (a) an Emergency, (b) a Force Majeure Event or an
Operating Force Majeure Event, (c) damage caused by an act or omission of
the Owner or a third party (other than an Affiliate, Subcontractor or other
agents or designees of the Operator) which is required to be repaired in order
for the Turbines to be operated and maintained in accordance with the standard
set forth in this Agreement, or (d) the receipt by the Operator of a
written request from the Owner for the Operator’s performance of Additional OMS
Services.


 


“Affiliate”
means, with respect to any Party, any Person or entity which, directly or
indirectly, is in control of, or is controlled by, or is under common control
with such Party or any Subsidiary of such Party. For the purposes of this
definition, control of a Party shall mean the power, direct or indirect, (a) to
vote in excess of fifty percent (50%) or more of the securities having ordinary
voting power for the election of directors, (b) to direct or cause the
direction of the management and policies of such Party, whether by contract or
otherwise.


 


“After
Tax Value” means an amount equal to the sum of any payment, credit or other
original amount (the “Original Amount”) plus an amount that will cause the
recipient to retain a sum equal to the Original Amount after federal income
taxes at the highest marginal rate are or would be imposed on the After Tax
Value.


 


“Agreement”
means the Supply Agreement, the Warranty Agreement or the OMS Agreement, as the
context requires.


 


“Ancillary
Parts and Equipment” means those ancillary parts, materials and equipment listed
in Exhibit A to the Supply Agreement, which are typically required,
together with the Major Turbine Components, to form a Turbine.


 


“Annual
Windsystem Availability” or “AWA” has the meaning given in Exhibit A
to the Warranty Agreement.


 


“Availability”
has the meaning given in Exhibit A to the Warranty Agreement.


 


“Available
Hours” has the meaning given in Exhibit A to the Warranty
Agreement.


 


“Average
Nominal Measured Energy” or “ANME” has the meaning given in Exhibit C
to the Warranty Agreement.


 


“AWA Period
Revenue” shall have the meaning given in Exhibit A to the Warranty
Agreement.


 


“Base
Hours” has the meaning given in Exhibit A to the Warranty
Agreement.


 


“Business
Days” means Monday through Friday of each week, except holidays in which
commercial banks in the United States are required or permitted to close.


 


I-1














 


“Change
in Law” means, after the date hereof, the enactment, modification or repeal or
any Governmental Requirements, or any change in the interpretation of any
Governmental Requirements by any Governmental Authority or court of law, that
materially affects Supplier’s schedule for performing any of its obligations
hereunder; provided a change in applicable tax law shall not constitute a “Change
in Law” hereunder.


 


“Commencement
Date” means the date upon which the Supplier shall have timely received the entirety
of (a) the Down Payment, (b) the Parent Guaranty, and such other fees
as may be applicable.


 


“Commissioning”
or “Commissioning Work” means the installation inspection, field commissioning
and acceptance testing, and controller power-up test, and start-up work to be
conducted by Supplier under the Supply Agreement, for each Turbine, in
accordance with the Commissioning and Start-Up Procedures.


 


“Commissioning
and Start-Up Procedures” means the field commissioning and acceptable testing
and start-up test and inspection procedures set forth on Exhibit O
of the Supply Agreement.


 


“Commissioning
Certificate” means a certificate issued by Supplier to Purchaser, in the form
attached as Exhibit M to the Supply Agreement, following completion
of Commissioning of each Turbine.


 


“Complete”
or “Completion” shall mean, with respect to any Turbine, that (i) all
Turbine Components have been delivered to the Project Site and installed in
accordance with the Installation Procedures, (ii) Purchaser has completed
the necessary terminations and connections of the collection lines and the
SCADA communication lines into the controller in the base of the Turbine Tower
using the collection lines and SCADA communication lines supplied by Purchaser,
and (iii) the Turbine has been Commissioned.


 


“Completion
Schedule” shall mean the schedule for the completion by Supplier and Purchaser,
as applicable, of Turbine installation and Commissioning as set forth in Exhibit T
to the Supply Agreement.


 


“CPI”
shall mean the Consumer Price Index for the United States City Average, All
Urban Consumers (CPI-U), All Items (base index year 1982-1984=100), as
published by the United States Department of Labor, Bureau of Labor Statistics.


 


“Default
Rate” means a per annum rate of interest equal to the lesser of (a) the
maximum rate permitted by law and (b) twelve percent (12%) per annum.


 


“Defect”
means a defect in any part or component of a Turbine covered under the Standard
Warranty that causes such part or component to fail during the Warranty Period.
A component is deemed to have “failed” only when it either (i) breaks, or (ii) ceases
to perform the operation for which it was designed, intended or installed;
provided, however, that normal wear and tear shall not constitute failure.


 


I-2

















 


“Delivery”
or “Delivered” means when a Supply Item is made available by Supplier for
pickup by Purchaser at its respective Designated Delivery Location, provided
however, that Purchaser may not take custody and control of the said Supply
Item until the applicable Progress Payment has been made by Purchaser and
received by Supplier.


 


“Delivery
Schedule” shall mean the schedule as set forth in Exhibit L to the
Supply Agreement for the Delivery by Supplier of the Supply Items to the
Designated Delivery Locations.


 


“Designated
Delivery Location” shall have the meaning given in Section 5.4 of
the Supply Agreement.


 


“Down
Payment” shall have the meaning given in Section 3.1 of the Supply
Agreement.


 


“Down
Payment Date” shall have the meaning given in Section 3.1 of the
Supply Agreement.


 


“Effective
Date” shall mean the date of the Supply Agreement.


 


“Electrical
Infrastructure” means the pad mounted transformers, feeder lines, high voltage
feeder lines, switches and all other related facilities owned by Purchaser
through which the electrical power generated by the Turbine is transferred from
the point of connection at the Turbine Controller to the Interconnection
Facilities.


 


“Emergency”
means an event occurring at the Project Site, or the Maintenance and Spare
Parts Facility or any adjoining property that poses actual or imminent risk of
serious personal injury or material physical damage to the Project, or parts
thereof, requiring immediate preventative or remedial action.


 


“Environmental
Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees,
judgments, injunctions, notices or binding agreements issued, promulgated or
entered into by any Governmental Authority, relating in any way to the
environment, preservation or reclamation of natural resources, the management,
environmental release or threatened environmental release of any Hazardous
Substance or to health and safety matters, including the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§
9601 et seq.; the Resource Conservation and Recovery Act, as the same may be
amended from time to time, 42 U.S.C. §§ 6901 et seq.; the Federal Water
Pollution Control Act, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control
Act, 15 U.S.C. §§ 2601 et seq.; the Clean Air Act, 42 U.S.C. §§ 7401 et seq.;
the Safe Drinking Water Act, 42 U.S.C. §§ 3803 et seq.; the Oil Pollution Act
of 1990, 33 U.S.C. §§ 2701 et seq.; the Emergency Planning and the Community
Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the Hazardous Material
Transportation Act, 49 U.S.C. §§ 1801 et seq. and the Occupational Safety and
Health Act, 29 U.S.C. §§ 651 et seq.; and any state and local counterparts or
equivalents, in each case as amended from time to time.


 


“EPC
Contract” means that certain agreement(s), if any, by and between Purchaser and
EPC Contractor(s), for the erection of the Turbine and the design, supply,
construction, installation and commissioning of (i) crane pads, laydown
areas, temporary construction roads


 


I-3

















 


and storage yards, (ii) permanent roads, Turbine
foundations and transformer foundations, (iii) the Electrical
Infrastructure, (iv) the SCADA System, including communication lines, (v) any
control and operation and maintenance buildings and facilities (vi) and
other civil and electrical elements and other work for the Project.


 


“EPC
Contractor(s)” means such person or entity selected by Purchaser as principal
contractor for performing work under the EPC Contract.


 


“Escrow
Agent” means such party as agreed upon by Supplier and Purchaser to serve as
the escrow agent.


 


“FAA”
means the Federal Aviation Administration.


 


“Final
Assembly Work” shall mean the final assembly work for the completion of Turbine
component assembly, as set forth in Exhibit P to the Supply
Agreement, prior to the installation of the Turbine.


 


“Financing
Documents” means the financing agreement, by and among the Purchaser or one of
its Affiliates, and the lenders or other financial institutions from time to
time party thereto by which the Purchaser or one of its Affiliates intends to
raise capital to finance the construction of the Project.


 


“Force
Majeure Event” means any event beyond the reasonable control of the Party
affected which materially affects its performance hereunder, including, without
limitation: war, hostilities, insurrection, riot, vandalism or other public
disorder or civil disturbance; terrorism; perils at sea, acts of God, fire,
hurricanes, tornadoes (including tornado watches or warnings for the Project
Site issued by the National Weather Service), mudslides, hail, earthquakes,
lightning, other extreme weather conditions, and, during Commissioning or
repairs, wind in excess of fifteen (15) meters per second or that would make
necessary lifting unsafe, but only for so long as such winds persist;
expropriation or confiscation; strikes, lockouts or other labor disputes;
perils at sea; or unforeseen delays in transportation or shipping, including with
respect to roadways, harbors, ports and other transportation and shipping
infrastructure; any Change in Law; or damage to any part of Supplier’s
factories or assembly plants, or the factories or assembly plants of its
Subcontractors. Force Majeure Events shall include those Force Majeure Events
experienced by any of Supplier’s Subcontractors in circumstances where Supplier
is not able to reasonably reallocate the work of that Subcontractor to an
alternative vendor.


 


“Germanischer Lloyd” means Germanischer Lloyd Windenergie
GMBH.


 


“Germanischer
Lloyd Turbine Certification”, “GL Certificate” or “GL Certified” means a
certification of the Turbine to be issued by Germanischer Lloyd.


 


“Governmental
Authority” means the government or any federal, state, municipal or other
political subdivision in which the Project is located, or any other
governmental or political subdivision thereof exercising jurisdiction over the
Project or, with respect to their rights and obligations hereunder or, with
respect to the Project, the Parties, including all agencies and
instrumentalities of such governments and political subdivisions.


 


I-4

















 


“Governmental
Requirements” means all laws, statutes, codes, rules, regulations, orders, and
decrees of any Governmental Authority in effect on the date hereof, including
all authorizations, consents, registrations, exemptions, Permits and licenses
with or from any Governmental Authority, applicable to the Project or, with
respect to their rights and obligations hereunder or with respect to the
Project, the Parties.


 


“Guarantor”
means UPC Wind Partners, LLC as guarantor under that certain Guaranty to be
entered into between Supplier and UPC Wind Partners, LLC.


 


“Hazardous
Substances” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum
or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all
other substances or wastes of any nature regulated pursuant to any
Environmental Law.


 


“Independent
Engineer” means Garrad Hassan, Germanischer Lloyd, the National Renewable
Energy Laboratory, or Global Energy Concepts, or such other independent
engineer as mutually agreed.


 


“Installation
Procedures” means the procedures for the proper (i) assembly, erection and
installation of the Towers on the Turbine foundations supplied by Purchaser, (ii) grouting
of the Turbines to the Tower foundations and tightening of all bolts using the
appropriate torque; (iii) assembly, erection and installation of the
Turbine Nacelles and Turbine Blades upon the Towers as specified in the Turbine
Specifications, Prudent Wind Industry Practices and Prudent Electrical Industry
Practices; (iv) installation and testing of the Turbine electrical cables,
communication cables, and control panels within the Turbine, and (v) connection
of the cables from each Turbine Nacelle to the main circuit breaker within the
ground controllers, all in accordance with the Turbine Installation Manual.


 


“Installation
Work” means the work required pursuant to the Installation Procedures to
assemble, erect and install the Turbines.


 


“Intellectual
Property Rights” means and refers to all patents, copyrights, trademarks,
service marks, trade secrets and all similar and related intellectual property
rights protected under any statutes, laws, codes, rules or regulations and
any licenses and other rights obtained by Supplier or its Affiliates from third
parties.


 


“Interconnection
Facilities” means all the land rights, materials, equipment and facilities to
be installed by Purchaser for the purpose of interconnecting the Turbines to
the Project’s substation so as to permit the delivery of electrical energy
generated by the Turbines to the interconnection point within the Project’s
substation, which shall include, but shall not be limited to, electrical
interconnection, switching, metering, relaying, communication and safety
equipment.


 


“Lenders”
shall mean those lenders providing financing for the Project.


 


“Maintenance
and Spare Parts Facility” means the location from which Operator will perform
the OMS Services.


 


I-5

















 


“Major
Turbine Components” means the Turbine Nacelle, Turbine Controller, Turbine hub,
Turbine Blades and Tower for each Turbine, as such items are more particularly
described in the Turbine Specifications.


 


*****


 


“Nominal
Expected Energy” or “NEE” has the meaning given in Exhibit C of the
Warranty Agreement.


 


“Nominal
Measured Energy” or “NME” has the meaning given in Exhibit C of the
Warranty Agreement.


 


“OMS
Agreement” means that certain Operation and Maintenance Service Agreement,
executed or to be executed between Supplier (or an Affiliate of Supplier) and
Purchaser (or an Affiliate of Purchaser) of even date herewith, pursuant to
which Supplier (or an Affiliate of Supplier) will operate, maintain and service
the Turbines.


 


“OMS
Manual” means the detailed operations, and maintenance service manual for the
Turbines supplied to Purchaser by Supplier, together with any future updates
and supplements thereto provided by Supplier.


 


“Operating
Force Majeure Events” means any event beyond the reasonable control of Supplier
or Operator, as applicable, including, without limitation, (i) war,
hostilities, insurrection, riot, vandalism or other public disorder or civil
disturbance; acts of God, fires, hurricanes, thunder storms (including thunder
storm watches or warnings declared for the area including the Project Site by
the National Weather Service), tornadoes (including tornado watches or warnings
declared for the area including the Project Site by the National Weather
Service), mudslides, hail, earthquakes, lightning (including lightning blade
strikes), or explosions; expropriation or confiscation, strikes, lockouts or
other labor disputes, a Change in Law; epidemic or quarantine; damage or
obstruction to any part of the Project caused by persons other than Supplier,
its Affiliates or their respective Subcontractors; a condition at the Site that
would not reasonably have been discovered by a project supplier comparable in
experience to Supplier conducting a competent and diligent visual inspection, (ii) wind
velocity at a constant speed or in gusts such that a reasonably prudent
professional qualified operator engaged in the business of performing routine
maintenance on wind energy generation facilities comparable to the Project
owned by it, acting for the advancement and protection of its own economic
interests, would not make the required repair at such time due to risks to
persons or property, (iii) with respect to the Turbines, any conditions at
the Project Site that are either outside the operating parameters or standards
for an IEC Class IIB wind turbine, as published as of the Effective Date
by the IEC, or outside the operating parameters or standards for the Turbine,
as set forth in the Turbine Specifications, which operating parameters or
standards may include, without limitation, conditions involving ambient
temperatures or wind speed and/or turbulence at the air density at the Project
Site, (iv) delays caused by inclement weather within the vicinity of the
Project Site and affecting the operation of the Project to the extent that such
inclement weather is materially greater than that normally experienced for the
time of year and locality and (v) unavailability of the grid for any
reason not caused by Supplier. The failure to provide Interconnection
Facilities


 


I-6

















 


that are energized and
operational in a manner that will permit the transmission and sale of power
from a Turbine and related Electrical Infrastructure shall be deemed an
Operating Force Majeure Event with respect to such Turbine until such time as
the Interconnection Facilities are provided and sufficiently operational with
respect to each such Turbine.


 


“Operator”
shall mean the person or entity hired by Project Manager to operate the Project
pursuant to the OMS Agreement.


 


“Party”
and “Parties” has the meaning given in the Preamble to the Supply Agreement.


 


“Permit”
means any valid waiver, exemption, variance, franchise, permit, authorization,
license or similar order, of or from any federal, state, county, municipal,
local, regional, or other governmental body, instrumentality, agency,
authority, court or other body having jurisdiction over the matter in question.


 


“Power
Curve” means the energy values produced by the Turbines at the various wind
speed bands set forth in Exhibit C-2 of (the Warranty Agreement.


 


“Power
Curve Warranty Buydown” means any payment made pursuant to Section 3.3(c) of
the Warranty Agreement.


 


“Progress
Payment” shall have the meaning given in Section 3.3 of the Supply
Agreement.


 


“Project”
has the meaning given in the Recitals of the Supply Agreement.


 


“Project
Completion” shall occur upon the Completion of the Turbines.


 


“Project
Completion Certificate” shall mean a certificate, in the form attached as Exhibit N
to the Supply Agreement, delivered by Supplier to Purchaser following
Completion of Commissioning of the Turbines.


 


“Project
Site” means the site described in Exhibit Q of the Supply
Agreement.


 


“Proven
Power Curve Percentage” or “PPCP” shall have the meaning given in Exhibit B
to the Warranty Agreement.


 


“Prudent
Electrical Industry Practices” means those practices, methods, standards and
acts (including those engaged in or approved by a significant portion of the
power industry for similar facilities in the United States) that at a
particular time in the exercise of good judgment would have been expected to
comply with Governmental Requirements, and to promote safety, environmental
protection, economy and expedition.


 


“Prudent
Wind Industry Practices” means standards and practices that are widely accepted
by the wind energy industry for wind projects of this size and that are
prudently applied and reasonably anticipated and intended to maximize output
and productivity of the Turbines, consistent with their intended design lives.


 


I-7

















 


“PTC
Benefits” means the tax credits that Purchaser may be eligible to claim for the
production of renewable energy by the Project in accordance with Section 45
of the United States Internal Revenue Code, as in effect as of the date of this
Agreement.


 


“Purchaser”
includes the named Purchaser identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Purchaser
Permits” mean all Permits required in connection with the development,
construction, ownership and operation of the Project, other than the Supplier
Permits.


 


“SCADA
System” means a supervisory control and data acquisition system, including a
central computer and related software, whether supplied and installed by
Supplier or by a third party, as more particularly described in the SCADA
System Specifications.


 


“SCADA
System Installation Manual” means the manual attached to the Supply Agreement
as Exhibit V.


 


“SCADA
System Specifications” means those specifications set forth on Exhibit U
to the Supply Agreement, pertaining to the SCADA System.


 


“Services”
shall mean the Commissioning Work.


 


“Site
Agreements” means any agreement between Purchaser, Project Manager, Supplier or
Operator, and any third party, with respect to the operation or maintenance of
the Project.


 


“Subcontractors”
means such subcontractors, consultants or suppliers which in the Supplier’s
reasonable judgment may be necessary to complete Supplier’s duties and
obligations under the Supply Agreement.


 


“Supplier”
includes the named Supplier identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Supplier
Permits” means the Supplier Permits listed on Exhibit R to the
Supply Agreement.


 


“Supply
Agreement” means the Turbine Supply Agreement dated as of December 31,
2007 by and between Supplier and Purchaser and any amendments thereto.


 


“Supply
Items” means, collectively, the Major Turbine Components and Ancillary Parts
and Equipment.


 


“Supply
Obligations” means Supplier’s obligations under the Supply Agreement to (i) supply
Purchaser the Supply Items and (ii) provide Purchaser certain services in
connection with the Supply Items, including (a) supplying, packing,
shipping and Delivering all Supply Items to their Designated Delivery Locations;
(b) at Purchaser’s request, providing a technical adviser to be present at
the Project Site during Turbine Installation; and (c) performing the
Commissioning Work.


 


I-8

















 


*****


 


“Testing
Engineer” means Garrad Hassan Germanischer Lloyd, the National Renewable Energy
Laboratory, or Global Energy Concepts, or such other independent engineer as
mutually agreed.


 


“Tower”
means each 77.4 meter steel tubular tower component of a Turbine having a hub
height of approximately eighty meters (80 m) (measured from the base of such
tower to the center of the Turbine hub) upon which a Turbine Nacelle shall be
mounted, including all ladders, platforms, internal lighting, safety equipment,
and all parts and assemblies necessary for a complete turbine tower, all as
further described in the Turbine Specifications.


 


“Tower
Foundation Requirements” means Supplier’s requirements for the foundation upon
which the Towers are to be erected (which shall specify foundation loads, bolt
configuration, cable configuration and grounding requirements).


 


“Transferee
Agreement and Acknowledgement” means the Agreement and Acknowledgement executed
by Owner and delivered to Supplier in the form attached hereto as Exhibit K
to this Agreement.


 


“Transmission
Facilities” mean the underground and/or overhead distribution, collection and
transmission lines; underground and/or overhead control, communications and
radio relay systems and telecommunications equipment; energy storage
facilities; interconnection and/or switching facilities, circuit breakers,
transformers; cables, wires, fiber, conduit, footings, foundations, towers,
poles, crossarms, guy lines and anchors, and any related or associated
improvements, fixtures, facilities, appliances, machinery and equipment.


 


“Turbine”
has the meaning given in the Recitals to the Supply Agreement.


 


“Turbine
Blade” means a turbine blade component of a Turbine (each Turbine shall have
three (3) Turbine Blades).


 


“Turbine
Component Storage Requirements” means Supplier’s standard requirements for
storage and maintenance of Turbine Components pending installation.


 


“Turbine
Controller” means the circuit breaker and controller equipment for each Turbine
as further described in the Turbine Specifications.


 


“Turbine
Installation Manual” means Supplier’s detailed manual for the Installation
Work.


 


I-9

















 


“Turbine
Nacelle” means the turbine nacelle component of a Turbine, including gearbox,
generators, blade pitch controls, brakes, hydraulic systems, lightning
protection system, and nacelle yaw controls, and associated control and
ancillary equipment.


 


“Turbine
Specifications” means those specifications set forth in Exhibit S
to the Supply Agreement pertaining to the Turbines.


 


“Turbine
Supply Documents” means, collectively, the Supply Agreement, the Warranty
Agreement, the OMS Agreement and all other agreements, documents or other
instrument executed and delivered by the Parties hereto in connection with the
supply, installation (if applicable) and maintenance of the Turbines.


 


“Warranted
Power Curve Percentage” or “WPCP” has the meaning given in Exhibit B
to the Warranty Agreement.


 


“Warranties”
means the Standard Warranty, the Availability Warranty, the Power Curve
Warranty, the Sound Warranty, and the IP Warranty given hereunder.


 


“Warranty
Agreement” means that certain warranty agreement by and between Supplier and
Purchaser of even date herewith, pursuant to which Supplier makes certain
covenants and warranties to Purchaser with respect to the Major Turbine
Components supplied pursuant to this Agreement.


 


“Warranty
Period Year” means, for the Turbines, the period beginning on the earlier of (a) the
date of Project Completion, or (b) six (6) months after the last Major
Turbine Component is Delivered to Purchaser, and ending exactly twelve (12)
months thereafter, and each of the following four (4) twelve (12) month thereafter;
provided, however that the last of such periods shall not extend beyond the end
of the Warranty Period.


 


I-10














 


[2012 TSA]


 


CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS AGREEMENT. THE REDACTIONS ARE
INDICATED WITH FIVE ASTERISKS (“*****”). 
A COMPLETE VERSION OF THIS AGREEMENT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.


 


Execution Copy


 


TURBINE
SUPPLY AGREEMENT


 


BY AND
BETWEEN


 


UPC WIND
ACQUISITION V, LLC


 


AND


 


CLIPPER
TURBINE WORKS, INC.


 


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE 1

  	
   

  	
  DEFINITIONS AND RULES OF INTERPRETATION

  	
  1

  
	
  1.1

  	
   

  	
  Definitions

  	
  1

  
	
  1.2

  	
   

  	
  Rules of Interpretation

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2

  	
   

  	
  SUPPLY AND OTHER OBLIGATIONS OF SUPPLIER

  	
  2

  
	
  2.1

  	
   

  	
  Supply and Commissioning Obligations

  	
  2

  
	
  2.2

  	
   

  	
  Permits; Governmental Requirements

  	
  3

  
	
  2.3

  	
   

  	
  Purchaser’s Right to Inspect

  	
  3

  
	
  2.4

  	
   

  	
  Subcontractors:

  	
  3

  
	
  2.5

  	
   

  	
  Safety

  	
  4

  
	
  2.6

  	
   

  	
  Independent Contractor

  	
  4

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 3

  	
   

  	
  PURCHASE PRICE AND PAYMENT

  	
  4

  
	
  3.1

  	
   

  	
  Purchase Price

  	
  4

  
	
  3.2

  	
   

  	
  Taxes

  	
  4

  
	
  3.3

  	
   

  	
  Progress Payments

  	
  4

  
	
  3.4.

  	
   

  	
  Punch List Retainage

  	
  6

  
	
  3.5

  	
   

  	
  Purchaser’s Credit Support

  	
  6

  
	
  3.6

  	
   

  	
  Warranty Agreement

  	
  6

  
	
  3.7

  	
   

  	
  Operations and Maintenance Service Agreement

  	
  6

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4

  	
   

  	
  DUTIES AND OBLIGATIONS OF PURCHASER

  	
  7

  
	
  4.1

  	
   

  	
  Purchaser’s Obligations

  	
  7

  
	
  4.2

  	
   

  	
  Cooperation with Supplier; Purchaser’s
  Representative

  	
  8

  
	
  4.3

  	
   

  	
  Permits; Governmental Requirements

  	
  8

  
	
  4.4

  	
   

  	
  Safety

  	
  8

  
	
  4.5

  	
   

  	
  Intellectual Property Rights: Licenses and
  Obligations

  	
  9

  
	
  4.6

  	
   

  	
  Transfer,

  	
  10

  
	
  4.7

  	
   

  	
  Access to Information

  	
  10

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5

  	
   

  	
  COMMENCEMENT, DELIVERY AND SHIPMENT

  	
  11

  
	
  5.1

  	
   

  	
  Commencement

  	
  11

  
	
  5.2

  	
   

  	
  Shipping Arrangements

  	
  11

  
	
  5.3

  	
   

  	
  Delivery Schedule

  	
  11

  
	
  5.4

  	
   

  	
  Designated Delivery Locations

  	
  11

  
	
  5.5

  	
   

  	
  Delay Delivery Damages:

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6

  	
   

  	
  FINAL ASSEMBLY WORK, INSTALLATION WORK,
  COMMISSIONING WORK AND PROJECT COMPLETION

  	
  12

  
	
  6.1

  	
   

  	
  Final Assembly Work and Turbine Installation

  	
  12

  
	
  6.2

  	
   

  	
  Commissioning

  	
  12

  
	
  6.3

  	
   

  	
  Project Completion

  	
  13

  
	
  6.4

  	
   

  	
  Purchaser Delays

  	
  13

  



 


i

















 


TABLE OF CONTENTS

(continued)


 


	
  ARTICLE 7

  	
   

  	
  FORCE MAJEURE EVENTS

  	
  13

  
	
  7.1

  	
   

  	
  Excused Performance

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8

  	
   

  	
  CHANGE ORDERS

  	
  14

  
	
  8.1

  	
   

  	
  Change Order

  	
  14

  
	
  8.2

  	
   

  	
  Change Order Process

  	
  14

  
	
  8.3

  	
   

  	
  No Change

  	
  14

  
	
  8.4

  	
   

  	
  Scope Changes Caused by a Force Majeure Event

  	
  15

  
	
  8.5

  	
   

  	
  Scope Changes Caused by Events within the Control of
  Purchaser

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 9

  	
   

  	
  LIMITATION OF LIABILITY

  	
  15

  
	
  9.1

  	
   

  	
  Supplier Not Responsible for Purchaser’s Work

  	
  15

  
	
  9.2

  	
   

  	
  Overall Limitation of Liability

  	
  15

  
	
  9.3

  	
   

  	
  Consequential Damages:

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 10

  	
   

  	
  TITLE AND RISK OF LOSS; INSURANCE

  	
  16

  
	
  10.1

  	
   

  	
  Title to Supply Items

  	
  16

  
	
  10.2

  	
   

  	
  Risk of Loss

  	
  16

  
	
  10.3

  	
   

  	
  Insurance

  	
  16

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 11

  	
   

  	
  REPRESENTATIONS AND WARRANTIES OF SUPPLIER

  	
  20

  
	
  11.1

  	
   

  	
  Due Organization; Good Standing

  	
  20

  
	
  11.2

  	
   

  	
  Due Authorization

  	
  20

  
	
  11.3

  	
   

  	
  Execution and Delivery

  	
  20

  
	
  11.4

  	
   

  	
  Governmental Approvals

  	
  20

  
	
  11.5

  	
   

  	
  Supply Items; Services

  	
  20

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
   

  	
  REPRESENTATIONS AND WARRANTIES OF PURCHASER

  	
  21

  
	
  12.1

  	
   

  	
  Due Organization; Good Standing; Qualified To Do
  Business

  	
  21

  
	
  12.2

  	
   

  	
  Due Authorization

  	
  21

  
	
  12.3

  	
   

  	
  Execution and Delivery

  	
  21

  
	
  12.4

  	
   

  	
  Governmental Approvals

  	
  21

  
	
  12.5

  	
   

  	
  Project Site

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 13

  	
   

  	
  MUTUAL INDEMNITY:

  	
  21

  
	
  13.1

  	
   

  	
  Mutual Indemnity

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 14

  	
   

  	
  DEFAULT; CURE; REMEDIES

  	
  22

  
	
  14.1

  	
   

  	
  Default by Supplier

  	
  22

  
	
  14.2

  	
   

  	
  Purchaser’s Remedies

  	
  22

  
	
  14.3

  	
   

  	
  Default by Purchaser

  	
  22

  
	
  14.4

  	
   

  	
  Supplier’s Remedies

  	
  23

  
	
  14.5

  	
   

  	
  Cancellation Due to a Force Majeure Event

  	
  23

  
	
  14.6

  	
   

  	
  Termination *****

  	
  24

  
	
  14.7

  	
   

  	
  Surviving Obligations

  	
  24

  



 


ii

















 


TABLE OF CONTENTS

(continued)


 


	
  ARTICLE 15

  	
   

  	
  DISPUTE RESOLUTION

  	
  24

  
	
  15.1

  	
   

  	
  Procedure

  	
  24

  
	
  15.2

  	
   

  	
  Qualifications of Arbitrators; Expenses

  	
  27

  
	
  15.3

  	
   

  	
  Performance During Dispute

  	
  27

  
	
  15.4

  	
   

  	
  Consolidation

  	
  27

  
	
  15.5

  	
   

  	
  Language

  	
  27

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 16

  	
   

  	
  GENERAL PROVISIONS

  	
  27

  
	
  16 1

  	
   

  	
  Waiver

  	
  27

  
	
  162

  	
   

  	
  Successors and Assigns

  	
  27

  
	
  16 3

  	
   

  	
  Permitted Assignments

  	
  27

  
	
  16 4

  	
   

  	
  Notices

  	
  28

  
	
  16 5

  	
   

  	
  Governing Law

  	
  29

  
	
  16 6

  	
   

  	
  Amendments

  	
  29

  
	
  16.7

  	
   

  	
  Attachments Incorporated

  	
  29

  
	
  16.8

  	
   

  	
  Entire Agreement

  	
  29

  
	
  16.9

  	
   

  	
  Confidentiality

  	
  29

  
	
  16.10

  	
   

  	
  Counterparts

  	
  30

  
	
  16.11

  	
   

  	
  English Language Documents

  	
  30

  
	
  16.12

  	
   

  	
  Severability

  	
  30

  
	
  16.13

  	
   

  	
  Headings

  	
  30

  
	
  16.14

  	
   

  	
  Agreement Revisions

  	
  30

  



 


iii

















 


	
  Exhibits

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Appendix
  I

  	
   

  	
  Definitions

  
	
  Exhibit A

  	
   

  	
  Ancillary
  Parts and Equipment

  
	
  Exhibit B

  	
   

  	
  Payment
  Schedule

  
	
  Exhibit C

  	
   

  	
  Spare
  Parts

  
	
  Exhibit D

  	
   

  	
  Turbine
  Installation Manual

  
	
  Exhibit E

  	
   

  	
  Foundation
  Loads Document

  
	
  Exhibit F

  	
   

  	
  Turbine
  Component Storage Requirements

  
	
  Exhibit G

  	
   

  	
  Termination
  Schedule

  
	
  Exhibit H

  	
   

  	
  Supplier’s
  Major Turbine Component Suppliers

  
	
  Exhibit I

  	
   

  	
  Supplier
  Account

  
	
  Exhibit J

  	
   

  	
  Guaranty

  
	
  Exhibit K

  	
   

  	
  Transferee
  Agreement and Acknowledgment

  
	
  Exhibit L

  	
   

  	
  Delivery
  Schedule

  
	
  Exhibit M

  	
   

  	
  Commissioning
  Certificate

  
	
  Exhibit N

  	
   

  	
  Project
  Completion Certificate

  
	
  Exhibit O

  	
   

  	
  Commissioning
  and Start-Up Procedures

  
	
  Exhibit P

  	
   

  	
  Final
  Assembly Work

  
	
  Exhibit Q

  	
   

  	
  Project
  Site

  
	
  Exhibit R

  	
   

  	
  Supplier
  Permits

  
	
  Exhibit S

  	
   

  	
  Turbine
  Specifications

  
	
  Exhibit T

  	
   

  	
  Completion
  Schedule

  
	
  Exhibit U

  	
   

  	
  SCADA
  System Specifications

  
	
  Exhibit V

  	
   

  	
  SCADA
  System Installation Manual

  



 


i

















 


TURBINE
SUPPLY AGREEMENT


 


THIS TURBINE SUPPLY
AGREEMENT (the “Agreement” or the “Supply Agreement”) is made and entered into
and effective as of December 31,2007 by and between CLIPPER TURBINE WORKS,
INC., a Delaware corporation (“Supplier”), and UPC WIND ACQUISITION V, LLC, a
Delaware limited liability company with a place of business c/o UPC Wind
Management, LLC, 85 Wells Ave., Suite 305, Newton, MA 02459 (“Purchaser”).
Supplier and Purchaser are sometimes referred to, individually, as a “Party”
or, collectively, as the “Parties”.


 


RECITALS


 


WHEREAS, Purchaser
desires to purchase, and Supplier desires to sell fifty (50) Clipper Windpower
2.5 MW “C-96” series wind turbine generators (each a ‘Turbine” and
collectively, (the “Turbines”), each consisting of the Major Turbine Components
and Ancillary Parts and Equipment (as set forth in Exhibit A
hereto). Additionally, Purchaser, in connection with its purchase of the
Turbines, desires to purchase and Supplier desires to provide the Commissioning
Work (as defined in Appendix I hereto), all on the terms and subject to
the conditions set forth herein.


 


WHEREAS, Purchaser shall
incorporate the Turbines into a single 125 MW wind power project being
developed by Purchaser to be located in the continental United States (the “Project”).


 


NOW, THEREFORE, for good
and valuable consideration, the receipt and adequacy of which is hereby
acknowledged, Supplier and Purchaser, intending to be legally bound, hereby
agree as follows:


 


AGREEMENT


 


ARTICLE
1


 


DEFINITIONS
AND RULES OF INTERPRETATION


 


1.1       Definitions. For purposes of the
Turbine Supply Documents and all schedules, exhibits and attachments thereto,
and in addition to the definitions elsewhere in this Agreement and the other
Turbine Supply Documents, the terms listed in Appendix I hereto shall
have the respective meanings assigned to such terms in Appendix I
hereto, which is incorporated herein and made a part hereof.


 


1.2       Rules of Interpretation. In
this Agreement: (a) references to Sections and to Exhibits are, unless
otherwise indicated, to Sections of and Exhibits to this Agreement; (b) the
headings to Sections and Articles of this Agreement are for ease of reference
only and shall not in any way affect its construction or interpretation; (c) the
masculine gender shall include the feminine and neuter and the singular number
shall include the plural, and vice versa, and references to persons shall
include individuals, bodies corporate, unincorporated associations, companies
and partnerships; and


 


1

















 


(d) references to Parties in this Agreement shall
be deemed to include references to their successors and permitted assigns.


 


ARTICLE
2


 


SUPPLY
AND OTHER OBLIGATIONS OF SUPPLIER


 


2.1       Supply and Commissioning Obligations.
Purchaser hereby agrees to purchase and, subject to the terms and provisions
hereof, Supplier agrees to supply and Deliver as provided in Subsections (a) and
(b) below, the Supply Items and related Services for the Turbines. With
respect to the Supply Items and related Services, following Purchaser’s
submittal to Supplier of the Down Payment, and subject to the compliance by
Purchaser with the terms hereof, Supplier agrees to do the following respecting
the Supply Items and Services:


 


(a)   supply, pack, and Deliver,
in accordance with wind industry practice and commercially reasonable shipping
carrier requirements and in an economic manner consistent with wind industry
practices, all Supply Items, the SCADA System and all related components and
parts (other than foundations, foundation bolts, pad mount transformers and
collection lines, communication lines and related equipment to be supplied by
Purchaser) necessary to install and commission wind turbine generators in the
quantity set forth above that are capable of performing to the Turbine
Specifications (the “Supply Obligations”);


 


(b)   perform the Commissioning
Work, as described in Section 6.2 below.


 


2.1.1       Failure
to Timely Deliver Down Payment. If Purchaser fails to deliver to Supplier
the Down Payment on or before the Down Payment Date, then Purchaser’s right to
purchase and Supplier’s obligation to sell and Deliver the Supply Items and
related Services shall terminate at the option of Supplier and be of no further
force or effect, provided that Supplier shall first give Purchaser five (5) days
written notice to afford Purchaser the opportunity to correct its performance.


 


2.1.2        Spare Parts.


 


(a)     During
the Warranty Period, Supplier shall maintain an inventory of spare parts at
such location and consisting of such spare parts as Supplier, in its sole
discretion, shall determine necessary for the timely operation and maintenance
of the Turbines during the Warranty Period (the “Necessary Spare Parts
Inventory”). The list of spare parts proposed by Supplier is attached hereto as
Exhibit C. It is the intention of the parties that the Necessary
Spare Parts Inventory be used and maintained during the Warranty Period in
order for Supplier to fulfill its obligations under the OMS Agreement and the
Warranty Agreement.


 


(b)     Purchaser
may purchase such additional spare parts, at Purchaser’s sole expense, and
maintain such additional spare parts on the Project Site, at Purchaser’s sole
expense; provided that such spare parts are available from Supplier without
unreasonably impacting Supplier’s production of turbines.


 


2

















 


(c)     Within
six (6) months of the date of final payment by Purchaser to Supplier of
the Purchase Price, Supplier shall place into escrow with an escrow agent to be
agreed upon between the parties, subject to an escrow agreement to be agreed
between the parties, drawings (the “Spare Parts Drawings”) necessary for
Purchaser to make or have made any spare parts for the Turbines whose
manufacture are subject to intellectual property rights of Supplier. Pursuant
to the terms of the agreed upon escrow agreement, Purchaser shall be provided access
to the Spare Parts Drawings only if and when Supplier is unable to provide
necessary spare parts for the Turbines to Purchaser due to a default under Section 14.1
(i) ,(ii), (iii) or (iv) under this Agreement.


 


2.1.3        SCADA System.
Purchaser shall purchase the SCADA System from Supplier (exclusive of any fiber
optic lines or other communication lines) for an amount equal to ***** Dollars
($*****) as may be adjusted by CCI as further described in Exhibit B. The
price of the SCADA System is included in the Purchase Price.


 


2.1.4        [Intentionally
Left Blank].


 


2.1.5        Other Items.
Supplier has provided Purchaser with: the Turbine Installation Manual, a copy
of which is set forth on Exhibit D; the Foundation Loads Document,
a copy of which is set forth on Exhibit E; and the Turbine
Component Storage Requirements, a copy of which is set forth on Exhibit F.
No later than ten (10) days prior to the anticipated Commissioning of the
first Turbine, Supplier shall provide to Purchaser the OMS Manual. Concurrently
with the execution of this Agreement, Supplier and Purchaser shall deliver to
the other Party the Warranty Agreement and the OMS Agreement, duly executed by
each Party. At Purchaser’s request and at Purchaser’s cost, within twelve (12)
months of Commissioning of the last Turbine, Supplier shall provide to
Purchaser a location specific site suitability certificate from Germanischer
Lloyd.


 


2.2       Permits: Governmental Requirements.
Supplier shall secure and pay for all Supplier Permits required for the
Delivery of the Supply Items to the Designated Delivery Location. Purchaser
shall cooperate with Supplier in obtaining the Supplier Permits. Supplier shall
have no obligation to obtain any Purchaser Permit; provided Supplier shall
cooperate with Purchaser in Purchaser’s efforts to obtain and comply with
Purchaser Permits. Supplier shall comply with all Governmental Requirements
applicable to the performance of its obligations hereunder.


 


2.3       Purchaser’s Right to Inspect.
Supplier shall permit Purchaser, upon ten (10) days prior written notice
to Supplier, to inspect the Turbines and to visit Supplier’s Turbine
manufacturing and assembly facilities for such purpose, subject in all cases to
Supplier’s confidentiality requirements and reasonable safety precautions, and
so long as such inspection and presence does not unreasonably interfere with or
delay the completion or Delivery of the Turbines or Supplier’s performance of
its obligations hereunder.


 


2.4       Subcontractors. Supplier may
retain such Subcontractors as in Supplier’s reasonable judgment may be
necessary to complete Supplier’s duties and obligations under this Agreement.
Supplier shall be solely responsible to pay its Subcontractors and the use of
any Subcontractor shall not limit Supplier’s obligations hereunder. The list of
Supplier’s Major Turbine Component suppliers is set forth on Exhibit H.
Supplier agrees that it will not use any Major Turbine


 


3

















 


Components not listed on Exhibit H without Purchaser’s
advance written consent, such consent not to be unreasonably withheld, conditioned
or delayed.


 


2.5            Safety. Until any Supply Item
has been Delivered, Supplier shall take reasonable steps to protect each Supply
Item against damage, destruction or theft, and shall ensure that all Supplier
Insurance covering the Turbines remains in full force and effect prior to
Delivery.


 


2.6          Independent Contractor. In
performing its duties and obligations under this Agreement, Supplier shall, at
all times, act in the capacity of an independent contractor, and shall not in
any respect be deemed (or act as) an agent of Purchaser for any purpose or
reason whatsoever. Supplier shall have no responsibility for any of Purchaser’s
Work hereunder.


 


ARTICLE
3


 


PURCHASE
PRICE AND PAYMENT


 


3.1       Purchase Price. For the Supply
Items, SCADA System and Services, Purchaser shall pay to Supplier ***** Dollars
($*****), which amount shall be adjusted pursuant to the CCI as defined in Exhibit B
attached hereto (the “Purchase Price”). Purchaser shall pay to Supplier on the
date of this Agreement (the “Down Payment Date”) a non-refundable amount equal
to ***** Dollars ($*****) (the “Down Payment”). All payments to be made under
this Agreement by Purchaser to Supplier shall be made in immediately available
funds to the Supplier account set forth in Exhibit I. The Purchase
Price is subject to adjustment by Change Order as provided in this Agreement.


 


3.2       Taxes. Supplier shall be
responsible for (a) all federal and state income taxes payable by Supplier
in connection with its net income, (b) all taxes in connection with the
import of any Supply Item into the United States, and (c) any business
license or fees arising in connection with Supplier’s business in any State.
Purchaser shall be responsible for all sales and use tax and any other federal,
state or local taxes imposed on the sale or use of the Supply Items and any
services provided hereunder (collectively “Taxes”).


 


3.3             Progress Payments.


 


3.3.1     The remaining amount of
the Purchase Price shall be paid by the Purchaser to the Supplier pursuant to
the Payment Schedule set forth on Exhibit B attached hereto (the “Payment
Schedule”). Upon completion of each of the milestones for the Project set forth
on Exhibit B attached hereto, the corresponding portion of the
Purchase Price shall be due and payable to Supplier as set forth on Exhibit B
attached hereto(each, a “Progress Payment”).


 


(a)           Purchaser shall pay the Down Payment
and each Progress Payment to Supplier in United States Dollars and in
immediately available funds to the account of Supplier, identified on Exhibit I.
Should Purchaser fail to make any Progress Payment when due, in addition any
other remedy available to Supplier under this Agreement, or otherwise, (i) Supplier
may enforce the Guaranty as set forth in Section 3.5 pursuant to
its terms; (ii) such overdue amount shall bear interest until paid in full
at the Default Rate, and (iii) Supplier may, without prejudice to any
other rights or remedies it may have under this Agreement, stop its performance
hereunder until the overdue amount and interest thereon is paid in full.


 


4

















 


(b)   Provided that Supplier has duly performed or
is reasonably performing its obligations hereunder and irrespective of any
other term of this Agreement, and provided that any delay in obtaining the
Project Completion Certificate within six (6) months after Delivery of the
last Major Turbine Component by Supplier for the Project is not caused solely
by Supplier or any of Supplier’s Affiliates or subcontractors, one hundred
percent (100%) of the Purchase Price, subject to the retention of the
applicable Punch List Retainage, shall be paid by Purchaser to Supplier no
later than six months after Delivery of the last Major Turbine Component by
Supplier for the Project.


 


(c)   *****


 


3.4       Punch List Retainage. In
delivering the Project Completion Certificate as provided in Section 6.3
below hereunder, Supplier shall include an estimated cost to complete each item
of Punch List Work (200% of such estimated costs being the “Punch List
Retainage”). The Progress Payment corresponding to delivery of the Project
Completion Certificate shall be decreased by an amount, if any, which is equal
to the Punch List Retainage, and upon the completion of any item of Punch List
Work to the reasonable satisfaction of Purchaser, Purchaser shall immediately
pay Supplier the Punch List Retainage that was retained by Purchaser for such
item of Punch List Work.


 


5














 


3..5          Purchaser’s Credit Support.
Purchaser shall, concurrently with the delivery by Purchaser of the Down
Payment, deliver to Supplier a guaranty from its parent company (the “Guaranty”)
in substantially the form attached hereto as Exhibit J.


 


3.6           Warranty Agreement. The
Parties acknowledge that, concurrent with the execution of this Agreement, the
Parties shall enter into the Warranty Agreement. The cost of the first two (2) years
of warranty coverage under the Warranty Agreement is included in the Purchase
Price.


 


3.7           Operations and Maintenance Service
Agreement. Concurrent with the execution of this Agreement, Affiliates of
the Purchaser and Supplier shall execute an OMS Agreement whereby Supplier, an
Affiliate of Supplier, or a contractor designated by Supplier and approved by
Purchaser (the “Contractor”) shall provide operation and maintenance service to
the Project. Pursuant to the terms of the OMS Agreement, the cost for the first
two (2) years of OMS Services (other than Additional OMS Services) is included
in the Purchase Price.


 


ARTICLE
4


 


DUTIES
AND OBLIGATIONS OF PURCHASER


 


4.1       Purchaser’s Obligations. Purchaser
agrees to perform the following, all on the terms and subject to the conditions
of this Agreement:


 


4.1.1        Payment. Purchaser shall make the
Down Payment, all Progress Payments and any other payments due Supplier under
this Agreement when due and shall be responsible for and promptly pay all
Taxes.


 


4.1.2        Purchaser’s Work. Purchaser
shall, at its sole cost and expense, be solely responsible for all work
necessary for the development, construction, completion and operation of the
Project (other than the Delivery of Supply Items and the performance of the
Services by Supplier) and for the installation and operation of the Turbines,
which work (herein “Purchaser’s Work”) shall include the following:


 


(a)          Site Suitability and Access.
Purchaser shall ensure that the Project Site is suitable for installation of
the Turbines in accordance with the Turbine Specifications and Turbine
Installation Manual and shall ensure that Supplier has continuous unfettered
physical access to the Project Site during normal business hours during the
performance of its Cornmissioning Work;


 


(b)         Acceptance and Shipment of Supply
Items. Upon Supplier’s Delivery of any Supply Item to its respective
Designated Delivery Location, Purchaser shall, unless otherwise agreed by the
Parties, within five (5) days after notice from Supplier and at such date
and time set forth in Supplier’s notice, pick up the Supply Item at its Designated
Delivery Location, and ship, install or store such Supply Item at the Project
Site. Purchaser shall be responsible for any reasonable costs incurred by
Supplier due to Purchaser’s delay in promptly picking up and transporting off
site any Supply Item upon its Delivery within said five (5) day period.
Purchaser shall be solely responsible for shipment and insurance of each Supply
Item once picked up;


 


6

















 


(c)          Storage. Purchaser shall ensure
that adequate staging, lay down and storage areas for the Supply Items are
available and maintained at the Project Site and shall store and maintain the
Supply Items pending installation in accordance with the Turbine Component
Storage Requirements set forth on Exhibit F:


 


(d)         Tower Foundations. Purchaser
shall investigate the Project Site and its soil conditions and shall design and
construct the Tower Foundations in accordance with Supplier’s Tower Foundation
Requirements;


 


(e)          Turbine and SCADA System
Installation. Purchaser shall perform the Turbine Installation Work and the
installation of the SCADA System, all in strict accordance with the Turbine
Specifications, the Turbine Installation Manual and the SCADA System
Installation Manual; and shall (i) notify Supplier of Purchaser’s proposed
schedule for all such work; (ii) coordinate such work with Supplier’s
Commissioning Work for the Turbines; and (iii) complete the Installation
Work in such a manner so that a team of two technicians can complete the
Commissioning of each Turbine within a period not to exceed three and a half (3
1⁄2 ) Business Days, without interruption or delay on a continuous basis until
all Turbines have been Commissioned;


 


(f)          Construction of Project. Purchaser
shall (i) perform the Final Assembly Work which is set forth in Exhibit P
hereto, (ii) perform all civil works (including roads, grading,
maintenance facilities, meteorological towers and other items); (iii) perform
all electrical works (including collection lines, Electrical Infrastructure,
Transmission Facilities, Interconnection Facilities and other items); (iv) provide
and install a remote terminal unit and cabling to the Substation,
meteorological towers, and communications lines for the SCADA System to the
Substation; and (v) provide any other items required for the operation of
the Project; and


 


(g)         Commissioning Responsibilities.
Purchaser shall ensure that at all times during Commissioning Work, each
Turbine shall have a continuous supply of electricity from the grid, and that
Purchaser’s utility will accept electricity generated by such Turbine. During
Commissioning, Purchaser shall provide assistance, including equipment,
electricians and mechanics, as may be reasonably required by Supplier to
address any out of scope impacts on the completion of Commissioning. Purchaser
shall arrange for the provision of full grid power to each Turbine to ensure
completion of the Commissioning Work for each Turbine.


 


4.1.3        Other Items. On or before the
date that is thirty (30) days prior to the date of Delivery of the first Major
Turbine Component for the Project, Purchaser shall provide Supplier with
notification of the anticipated date that Purchaser will energize the
substation for the Project.


 


4.2     Cooperation with Supplier: Purchaser’s
Representative. Purchaser shall cooperate with Supplier and, if applicable,
shall cause its EPC Contractor and any other contractors engaged by Purchaser
with respect to the Project (herein, “Purchaser’s Contractors”), to cooperate
with Supplier, all in connection with Supplier’s performance of its obligations
hereunder. Purchaser shall promptly provide Supplier with a schedule of the
names and contact information for all of Purchaser’s


 


7

















 


Contractors and shall update such schedule
periodically. Purchaser designates Scott Rowland as its representative (“Purchaser’s
Representative”) in dealing with Supplier with respect to this Agreement.


 


4.3           Permits: Governmental Requirements.
Purchaser shall secure and pay for all Purchaser Permits, including any permits
required for the delivery of Supply Items from the Designated Delivery Location
to the Project Site. Supplier shall cooperate with Purchaser in obtaining
Purchaser’s Permits. Purchaser shall have no obligation to obtain any Supplier
Permit; provided that, Purchaser shall cooperate with Supplier in Supplier’s
efforts to obtain Supplier Permits. Purchaser shall comply with all
Governmental Requirements applicable to the performance of Purchaser’s Work.


 


4.4           Safety. Upon Delivery of any
Supply Item to its Designated Delivery Location, Purchaser shall take
reasonable steps, and shall ensure that the EPC Contractor and the Purchaser’s
Contractors take reasonable steps, to protect any such Supply Item against
damage or theft.


 


4.5           Intellectual Property Rights:
Licenses and Obligations.


 


4.5.1        Patents.
Supplier hereby grants to Purchaser under Supplier’s patent rights, only the
non-exclusive right to use the Supply Items provided to Purchaser under this
Agreement. Supplier expressly reserves all other patent rights, including,
without limitation, the right to make, use, sell, offer for sale and import
other products identical to or similar to the Supply Items. Other than the
rights granted herein with respect to the Supply Items, Supplier expressly
reserves all other patent rights, and Purchaser shall not have the right under
Supplier’s patent rights to make, use, sell, offer for sale, or import any
products or methods that infringe Supplier’s patents or to sublicense any of
the foregoing rights.


 


4.5.2        Trade Secrets.
Purchaser acknowledges that the technical, operation and maintenance, and other
information it receives in connection with the Supply Items (including, without
limitation, any and all firmware, software, Turbine Specifications, SCADA
System Specifications, installation and operation and maintenance procedures,
know-how and similar items) constitute trade secret information that is
proprietary to Supplier. Supplier hereby grants to Purchaser under Supplier’s
trade secret rights, the non-exclusive right to use such trade secrets only in
the installation and operation and maintenance of the Supply Items. Supplier
further grants to Purchaser under Supplier’s trade secret rights, the
non-exclusive right to disclose such trade secrets to a third party only as
necessary for the financing, installation and operation and maintenance of the
Supply Items provided such third party executes a written agreement obligating
it to maintain the confidentiality of the trade secret information and to
return all copies of such trade secret information received and prohibiting
reverse engineering, disassembly, and decompilation of any of the trade secret
information. Other than the rights granted herein with respect to the Supply
Items, Supplier expressly reserves all other trade secret rights. Purchaser
agrees to maintain all such trade secret information in strict confidence and
shall not disclose such trade secret information to any third party except in
accordance with this Section 4.5.2. The obligations of
confidentiality herein shall survive termination or expiration of this
Agreement.


 


4.5.3        Copyrights.
Purchaser acknowledges that the technical, operation and maintenance, and other
information it receives in connection with the Supply Items (including,


 


8

















 


without limitation, any
and all firmware, software, Turbine Specifications, SCADA System
Specifications, installation and operation and maintenance procedures,
descriptions of know-how and similar written items) constitute copyrightable
material. Supplier hereby grants to Purchaser under Supplier’s copyrights, the
non-exclusive right to copy and use such copyrighted materials only in the
installation and operation and maintenance of the Supply Items. Supplier
further grants to Purchaser under Supplier’s copyrights, the non-exclusive
right to copy the copyrightable materials and distribute such to a third party
only as necessary for the installation and operation and maintenance of the
Supply Items, provided such third party executes a written agreement obligating
it to return all copies of such copyrightable materials received, prohibiting
any further copying or distribution of such copyrightable materials, and
prohibiting reverse engineering, disassembly and decompilation of any of the
copyrightable materials. Other than the rights granted herein with respect to
the Supply Items, Supplier expressly reserves all other copyright rights.
Purchaser shall not have the right to sublicense any of the Supplier’s
copyright rights or the right to create derivative works of any of the
copyrightable materials. Purchaser shall not reverse engineer, disassemble or
decompile any of the copyrightable materials.


 


4.5.4        Trademarks and
Service Marks. Purchaser shall not have any rights in any trademarks or
service marks, whether registered or not, that are owned or controlled by
Supplier. Purchaser shall not utilize any trademark or service mark that is
substantially similar to any trademarks or service marks owned or controlled by
Supplier. Purchaser may reference only those trademarks or service marks owned
by Supplier in its written materials; provided that, such reference clearly
denotes that such is a trademark or service mark and is owned by Supplier.


 


4.5.5        Transfer of Title
in Supply Items. Should Purchaser transfer title in any of the Supply Items
to a third party, the licenses provided in this Section 4.5 shall
run with such Supply Items, provided such third party executes a Transferee
Agreement and Acknowledgment, in the form attached hereto as Exhibit K,
acknowledging Supplier’s ownership in the respective Intellectual Property
Rights and obligating itself to all of the same prohibitions and restrictions
with respect to Supplier’s Intellectual Property Rights described in this Section 4.5.
Purchaser acknowledges that the Supply Items may be subject to the export
control laws and regulations of the United States of America and agrees to
comply with all such laws and regulations regarding any export of any of the
Supply Items.


 


4.5.6        Ownership and
Injunctive Relief. All Intellectual Property Rights owned or controlled by
Supplier shall remain the exclusive property of Supplier and nothing herein
shall be construed as a sale, lease, loan, or transfer of any of such
Intellectual Property Rights. Purchaser shall derive no rights, title or
interest therein except as expressly set forth in this Agreement. Any technical
information concerning the Supply Items that Purchaser acquires or develops in
connection with the ownership or operation of the Turbines shall be the
property of Supplier. Further, Purchaser acknowledges that a breach of the
confidentiality provisions in this Agreement may cause Supplier irreparable
harm and damage that may not be recoverable at law and that Purchaser shall be
entitled to obtain injunctive relief in addition to any other rights or
remedies Purchaser may have.


 


4.5.7        Government Rights.
Any and all computer software and related documentation provided as part of the
Supply Items are “commercial items” as that term is defined at 48 C.F.R. 2.01 (October 1995)
comprising “commercial computer software” and


 


9

















 


“commercial computer
software documentation” as used in 48 C.F.R. 12.212 (September 1995) and
other applicable acquisition regulations and are provided to the U.S.
Government only as a commercial item and subject to the terms and conditions
and all restrictions set forth in this Agreement as applicable to such computer
software and related documentation. Consistent with 48 C.F.R. 12.212 and 48
C.F.R. 227.7202 (June 1995), all U.S. Government users and licensees
acquire the software and its related documentation with only those rights
applicable to such software and related documentation as set forth in this Section 4.5.


 


4.6           Transfer. Purchaser covenants
and agrees that it will not sell, lease or otherwise transfer the Turbines or
any part thereof unless Purchaser first obtains and delivers to Supplier a
Transferee Agreement and Acknowledgment, executed by the proposed transferee.
Notwithstanding anything else contained herein, Purchaser may assign in whole
or in part its rights under this Agreement to an Affiliate upon notice to
Supplier.


 


4.7           Access to Information. From
the date of this Agreement through the end of the fifteenth (15th) year after
Project Completion, Purchaser shall provide to Supplier prompt access to all
technical, operational and maintenance and other information it receives or
collects in connection with its operating the Turbines. The collection of all
such data shall be at the reasonable expense of Supplier. All information
provided by Purchaser hereunder shall be subject to the provisions of Section 16.9.


 


ARTICLE
5


 


COMMENCEMENT,
DELIVERY AND SHIPMENT


 


5.1           Commencement. Subject to Section 2.1.1.
Supplier shall commence performance of its obligations under this Agreement on
the Down Payment Date. In addition to Supplier’s other rights and remedies
hereunder, if any payment due under this Agreement is not timely made by Purchaser,
the delinquent payment amount shall accrue interest at the Default Rate.


 


5.2           Shipping Arrangements. All
Supply Items shall be delivered Ex Works at the Designated Delivery Locations.
For purposes of this Agreement, each individual Supply Item and the SCADA
System shall be deemed “Delivered” and Supplier shall have satisfied its
delivery arrangements with respect thereto, when Supplier makes available such
Supply Item and SCADA System at its Designated Delivery Location for pick up by
Purchaser, provided however, that Purchaser may not take custody and control of
the said Supply Item until the applicable Progress Payment has been made by
Purchaser and received by Supplier. Purchaser shall be responsible for all
loading and shipment of the Supply Items and SCADA System from their respective
Designated Delivery Locations to the Project Site and shall pay for all costs
and expenses incurred by Purchaser related thereto, including the costs of
maintaining insurance on such Supply Item and SCADA System during shipment of
such Supply Item and SCADA System from its respective Designated Delivery
Location to the Project Site.


 


5.3           Delivery Schedule. The Supply
Items shall be Delivered to their Designated Delivery Locations in accordance
with the Delivery Schedule attached as Exhibit L (the “Delivery
Schedule”); provided however, that Supplier shall use commercially reasonable
efforts to work with Purchaser to revise the Delivery Schedule as necessary
considering Supplier’s manufacturing


 


10

















 


schedules and Purchaser’s Project requirements.
Delivery dates in the Delivery Schedule will be deemed met so long as the
Supply Items are delivered to the Designated Delivery Locations on or before
the date for such delivery set forth in the Delivery Schedule; provided that,
Supplier shall have the right to Deliver the Supply Items up to one (1) month
earlier than provided for in the Delivery Schedule. The SCADA System shall be
delivered at a Designated Delivery Location mutually agreed by the Parties
following the installation of the first Turbine at the Project Site by
Purchaser.


 


5.4           Designated Delivery Locations.
Unless otherwise agreed in writing by the Parties, Supplier shall Deliver the
Supply Items as follows: (i) Turbine Nacelle, Turbine Controller, Turbine
hub and Ancillary Parts and Equipment at Supplier’s factory near Cedar Rapids,
Iowa, (ii) the Turbine Blades at such location or warehouse facility as
Supplier may direct near Houston, Texas, or at another mutually agreed upon
location, provided any costs associated with such other mutually agreed
location be borne by Purchaser, and (iii) the Towers at the manufacturing
facility located in Chattanooga, Tennessee, or at such other domestic location
as Supplier may specify at any point prior to three (3) months from the
Delivery date set forth in the Delivery Schedule. Each of the foregoing
locations is referred to herein as a “Designated Delivery Location.”


 


5.5           Delay Delivery Damages. The
Parties acknowledge that Purchaser will suffer damages that will be difficult
to ascertain if Purchaser fails to Deliver any Major Turbine Component within thirty
(30) days of the applicable date of Delivery set forth in the Delivery
Schedule. Consequently, the Parties agree that Supplier will pay Purchaser, if
any Major Turbine Component is Delivered thirty (30) days or more late and such
delay was not due to any Force Majeure Event or breach by Purchaser of any of
its obligations under this Agreement, the following amount as liquidated
damages: For each full day after the first thirty (30) days following the date
that the Delivery of such Major Turbine Component is delayed beyond the date
specified in the Delivery Schedule, an amount equal to $***** per Turbine per
day for the first fifteen (15) days after delay payments become payable, an
amount equal to $***** per day for the next fifteen (15) days, and an amount
equal to $***** per day thereafter (the “Delay Delivery Damages”); provided
that, in no event shall the aggregate Delay Delivery Damages payable hereunder
exceed ***** percent (*****%) of the pro-rata portion of the Purchase Price
applicable to the Turbine for which such delayed Major Turbine Component is a
component. It is understood and acknowledged by the Parties that if more than
one Major Turbine Component applicable to a Turbine is delivered late, the
liquidated damages applicable to the Turbine will not exceed $***** per day
(for the first 15 days after delay payments become payable), $***** per day
(for the next 15 days of delay payments), and $***** per day (for delay
payments thereafter), as applicable. The Parties acknowledge and agree that the
Delay Delivery Damages set forth above are a reasonable estimate of the damages
Purchaser will suffer because of late Delivery of any Major Turbine Component
and that, therefore, the Delay Delivery Damages set forth herein shall be
Purchaser’s sole and exclusive remedy with respect to such Delivery delays.


 


11

















 


ARTICLE
6


 


FINAL
ASSEMBLY WORK, INSTALLATION WORK, 

COMMISSIONING WORK AND PROJECT COMPLETION


 


6.1           Final Assembly Work and Turbine
Installation. Purchaser shall complete the Final Assembly Work with respect
to all Turbines in conformance with the procedures and requirements set forth
in Exhibit P, and shall complete the Installation Work with respect
to all Turbines in accordance with the Installation Procedures and, subject to Section 5.3
above, within the period of time set forth on the Completion Schedule.


 


6.2           Commissioning. Commissioning
of the Turbines shall be conducted as follows:


 


6.2.1        Advance Completion
Notice. No less than thirty (30) days prior to the date Purchaser expects
Supplier to commence the Commissioning Work, Purchaser shall provide Supplier
with written notice (the “Advance Completion Notice”) of Purchaser’s
anticipated completion date of the Installation Work and the date on which
Supplier shall commence the Commissioning Work (which date shall be no later
than the date that Supplier is obligated to commence the Commissioning Work as
set forth in the Completion Schedule). Purchaser shall use commercially
reasonable efforts to schedule Turbine Installation for all Turbines in the
Project so that Supplier can complete the Commissioning of each Turbine without
interruption or delay on a continuous basis until all the Turbines have been
Commissioned.


 


6.2.2        Turbine
Installation Inspection. Following completion of the Installation Work with
respect to any Turbine, Purchaser shall deliver a written notice of completion
to Supplier (an “Installation Completion Notice”) and Supplier shall examine
each Turbine in accordance with the Installation Procedures and the Turbine
Installation Manual. If the Turbine fails to conform to the standards contained
in the installation inspection procedures set forth in the Turbine Installation
Manual, then it shall be deemed not properly installed, and Supplier shall
promptly so notify Purchaser. Purchaser shall then promptly take all required
action to complete the Installation Work for all Turbine(s) failing the
installation inspection procedures.


 


6.2.3        Commissioning Work.
Supplier shall perform the Commissioning Work for the Turbines in accordance
with the Commissioning and Start-Up Procedures and the Completion Schedule,
subject to any adjustment in the completion of the Commissioning Work, pursuant
to Section 5.3 hereof, due to Supplier’s early Delivery of the
Supply Items (provided, however, that Supplier’s obligation to Complete the
Commissioning Work by such time set forth on the Completion Schedule shall be
extended to the extent of Purchaser’s delay in completing the Installation
Work). Upon completion of the Commissioning of each Turbine, Supplier shall
issue to Purchaser a commissioning certificate for such Turbine in the form
attached hereto as Exhibit M (each a “Commissioning Certificate”).
Within five (5) days after receipt of a Commissioning Certificate,
Purchaser shall either approve such Commissioning Certificate or deliver to
Supplier written notice of any work remaining to be completed by Supplier (the “Punch
List Work”). If Purchaser fails to deliver such notice within such five (5) day
period, the Commissioning Certificate will be deemed approved by Purchaser.


 


12

















 


6.3           Project Completion. Within
five (5) days after the delivery by Supplier to Purchaser of a
Commissioning Certificate for the Project’s final Turbine, Supplier shall also
deliver to Purchaser a completion certificate for all Turbines in the Project
(the “Project Completion Certificate”), in the form attached hereto as Exhibit N,
together with a list of any remaining Punch List Work on any Turbine, a
schedule for completing the Punch List Work and an estimate of the cost of each
item of Punch List Work. Supplier shall thereafter promptly complete all Punch
List Work.


 


6.4           Purchaser Delays. In the event
that any of the actions of Purchaser, the EPC Contractor or any of Purchaser’s
Contractors cause a delay in the performance by Supplier of the Commissioning
Work, Purchaser shall pay Supplier its actual documented costs directly
attributable to such delay, including wages, lodging and meals.


 


ARTICLE
7


 


FORCE
MAJEURE EVENTS


 


7.1           Excused Performance. If either
Party is rendered wholly or partially unable to perform its obligations (other
than payment obligations) under this Agreement due to the occurrence of a Force
Majeure Event, such Party will be excused from the affected performance
obligation (other than payment obligations), provided that:


 


(a)   the affected Party gives the other Party
notice describing the particulars of the occurrence, including an estimate of
its expected duration and probable impact on the affected Party’s obligations
hereunder, such notice shall be given promptly after becoming aware of the
occurrence of the Force Majeure Event, and, in no event more than seven (7) days
after the affected Party becomes aware or should reasonably have been aware of
such occurrence;


 


(b)   the affected Party shall continually exercise
all commercially reasonable efforts to mitigate the effect of such Force
Majeure Event, remedy its inability to perform, and limit damages to the other
Party and shall promptly resume its performance when the Force Majeure Event no
longer impacts its ability to perform, and shall give the other Party prompt
notice of its intent to resume such performance;


 


(c)   the suspension of a Party’s performance
affected by the Force Majeure Event shall be of no greater scope and of no
longer duration than is reasonably required by the Force Majeure Event;


 


(d)   no liability of either Party which arose
before the occurrence of the Force Majeure Event shall be excused as a result
of the occurrence thereof; and


 


(e)   no Force Majeure Event shall relieve any
Party from performing those of its obligations that are not materially affected
by the Force Majeure Event.


 


13














 


ARTICLE
8


 


CHANGE
ORDERS


 


8.1           Change Order. The term “Change
Order” as used herein shall mean a written instrument signed by Purchaser and
Supplier, stating their mutual agreement upon any of the following: (i) a
change in the fabrication or features of the Turbines (such as adding Federal
Aviation Administration lighting or a cold weather package); (ii) a change
in the Delivery Schedule or Completion Schedule; (iii) a change in the
Commissioning Work; (iv) a change in the number of or location of Project sites;
or (v) an adjustment in the Purchase Price (collectively “Scope Changes”).


 


8.2           Change Order Process.
Purchaser may request Scope Changes within the general scope of this Agreement
consisting of additions, deletions, or other revisions. If Purchaser so desires
to request Scope Changes, it shall submit a change request to Supplier in
writing. Within ten (10) Business Days after its receipt of any such
request, Supplier shall submit a detailed proposal to Purchaser stating (a) the
increase or decrease, if any, in the Purchase Price which would result from
such change, and (b) the effect, if any, upon the Delivery Schedule or
Completion Schedule by reason of such proposed change. Purchaser shall have
five (5) days from receipt of Supplier’s detailed proposal to accept or
reject in writing Supplier’s proposal in relation to the requested change. If
Purchaser agrees with Supplier’s proposal, Purchaser and Supplier shall execute
a Change Order reflecting the requested Scope Changes and proposed adjustments,
if any, in the Purchase Price and the Delivery Schedule or Completion Schedule.
In the event Purchaser disagrees with Supplier’s proposal, Purchaser shall
promptly so notify Supplier, following which the Parties shall negotiate in
good faith a solution which is satisfactory to both Purchaser and Supplier.
Should Purchaser fail to respond to Supplier in writing within the foregoing
five (5) day period, Purchaser shall be deemed to have withdrawn its
requested change.


 


8.3           No Change. Notwithstanding
anything to the contrary contained in this Agreement, Supplier shall not be
obligated to proceed with any Scope Changes requested by Purchaser unless and
until a Change Order is executed by the Parties in relation to such change.
Further, Supplier shall not be required to implement a requested Scope Change
by Purchaser if the implementation of such change would, in Supplier’s
reasonable opinion, likely impair Supplier’s ability to achieve any of the
performance guarantees, warranties or covenants set forth in this Agreement,
the OMS Agreement, and/or the Warranty Agreement.


 


8.4           Scope Changes Caused by a Force
Majeure Event. If a Force Majeure Event occurs that materially adversely
affects Supplier’s performance of all or a portion of the sale and Delivery
obligations hereunder or if such a Force Majeure Event causes any of the
Commissioning Work to be temporarily or permanently prevented, Supplier shall
be entitled to a Change Order reflecting such impact of such Force Majeure
Event, including an extension in Supplier’s time for performance for such delay
to the extent Supplier’s performance is actually delayed. In the case of a
Force Majeure Event, Supplier must notify Purchaser of Supplier’s intent to
request a Change Order (the “Notice of Intention”) within thirty (30) Business
Days of the Force Majeure Event. Supplier shall submit to Purchaser a draft
Change Order outlining, with reasonable specificity, the requested Scope
Changes within ten (10) Business Days after the Notice of Intention is
delivered to Purchaser.


 


14

















 


8.5           Scope Changes Caused by Events
within the Control of Purchaser. If Purchaser, EPC Contractor or any of
Purchaser’s Contractors causes an event that materially adversely affects
Supplier’s performance of all or a portion of the sale and Delivery obligations
hereunder or if such event causes the Commissioning Work to be temporarily or
permanently prevented, Supplier shall be entitled to a Change Order reflecting
such impact of such event, including (i) an extension in Supplier’s time
for performance for such delay to the extent Supplier’s performance is actually
delayed, and (ii) an increase in the Purchase Price with respect to such
additional cost to the extent such delay is caused solely by Purchaser, EPC
Contractor or any of Purchaser’s Contractors. In the case of such a Purchaser
caused event, Supplier must notify Purchaser of Supplier’s intent to request a
Change Order (the “Notice of Intention”) within thirty (30) Business Days of
the Purchaser caused event. Supplier shall submit to Purchaser a draft Change
Order outlining, with reasonable specificity, the requested Scope Changes
within ten (10) Business Days after the Notice of Intention is delivered
to Purchaser.


 


ARTICLE
9


 


LIMITATION
OF LIABILITY


 


9.1           Supplier Not Responsible for
Purchaser’s Work. Notwithstanding anything to the contrary set forth
herein, Supplier shall not have any responsibility for (a) Project Site
selection, permitting or Turbine siting within the Project Site; (b) the design,
supply or construction of Tower foundations; (c) the assembly, erection
and installation of the Turbines or the SCADA System; (d) the design,
assembly, erection and installation of any other element of the Project, (e) obtaining
rights required by the Project to sell or transmit its electrical output, or (f) any
other element of Purchaser’s Work, all of which are expressly the
responsibility of Purchaser.


 


9.2           Overall Limitation of Liability.
Notwithstanding anything to the contrary contained in this Agreement, in no
event shall Supplier, its parent company, Affiliates and agents be liable,
alone or in the aggregate, to Purchaser for any damages, claims, demands,
suits, causes of action, losses, costs, expenses and/or liabilities related in
any manner to this Agreement, the Warranty Agreement and the OMS Agreement in
excess of an amount equal to ***** percent (*****%) of the Purchase Price,
regardless of whether such liability arises out of breach of contract,
guarantee or warranty, tort, product liability, indemnity, contribution, strict
liability or any other legal theory; provided, however, the preceding
limitation of liability shall not apply to, and no credit shall be issued
against such liability for, (a) Supplier’s indemnity obligations set forth
in Section 13.1 solely as they relate to claims by third Parties
for bodily injury or property damage, or (b) the fraud or willful
misconduct of Supplier.


 


9.3           Consequential Damages.
Notwithstanding anything to the contrary contained in this Agreement and except
as set forth in the last sentence of this Section, Purchaser and Supplier waive
all claims against each other (and against each other’s parent company,
Affiliates, contractors, subcontractors, consultants, vendors, suppliers and
agents) for any consequential, incidental, indirect, special, exemplary or
punitive damages (including, but not limited to, loss of actual or anticipated
profits, revenues or product; loss by reason of shutdown or non-operation;
increased expense of operation, borrowing or financing; loss of use or
productivity; or increased cost of capital), and regardless of whether any such
claim arises out of breach of contract or warranty, tort, product liability,
indemnity, contribution, strict liability or any other legal theory. Any


 


15

















 


consequential, incidental, indirect, special,
exemplary or punitive damages incurred by Supplier or Purchaser in relation to
a third Party shall, for all purposes of this Agreement, be deemed consequential,
incidental, indirect, special, exemplary or punitive damages in relation to any
claim brought by Supplier or Purchaser against the other Party to this
Agreement. Any liquidated damages payable by Supplier under this Agreement
shall not be deemed consequential, incidental, indirect, or special damages for
purposes of this Agreement.


 


ARTICLE
10


 


TITLE
AND RISK OF LOSS; INSURANCE


 


10.1         Title to Supply Items. Title to
any Supply Item shall transfer to the Purchaser upon (i) the Delivery of
such Supply Item to its Designated Delivery Location and (ii) Purchaser’s
payment of and Supplier’s receipt of, the applicable Progress Payment.


 


10.2         Risk of Loss. Supplier shall
bear the risk of loss and damage with respect to any Supply Item (including
each individual Major Turbine Component) until Delivery of such Supply Item to
its Designated Delivery Location. In performing the Commissioning Work,
Supplier shall be deemed a contractor of Purchaser performing the Services on
Supply Items then owned by Purchaser. Upon the Delivery of any Supply Item to
its Designated Delivery Location, care, custody and control of, and risk of
loss or damage to, such Supply Item shall thereupon transfer to the Purchaser.


 


10.3         Insurance. Supplier and
Purchaser shall maintain the following insurance while this Agreement is in
effect:


 


10.3.1              Supplier Insurance.


 


Supplier shall carry and
maintain or cause to be carried and maintained, at all times during the Term of
this Agreement, insurance coverage with limits as set forth in this Section (the
“Supplier Insurance”).


 


Marine
Cargo Insurance


 


All property and
interests of every kind and description (including materials, equipment,
machinery and spares) intended for the Project or subsequent operations while
in transit by land, air and/or sea. All Risks of physical loss or damage from a
cause not excluded but including war, strikes, riots and civil commotions and
terrorism while in transit, on a continuous open cover basis. Increased cost of
working - the additional expenditure necessarily and reasonably incurred for
the purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Property


 


At all times the Supplier’s
factory premises, plant, machinery, raw materials and finished stocks all
related to and comprising the Project under a property insurance in an amount
equal to the full replacement value of the above named items for “all risks” of
physical loss or damage including, but not limited to, coverage for earth
movement,


 


16

















 


flood, windstorm,
earthquake, sabotage, terrorism, riots, civil commotion, testing, boiler and
machinery, transit and off-site storage. The policy may contain separate sub
limits and deductibles subject to insurance company underwriting guidelines.
Deductibles under the policy shall not exceed $100,000 per occurrence, except
for deductibles for natural catastrophe peril, which shall not exceed five
percent (5%) of the insured loss


 


Increased cost of working
- the additional expenditure necessarily and reasonably incurred for the
purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Workers
Compensation


 


Coverage shall comply
with any statutory obligation imposed by Workers Compensation, Occupational
Disease Laws, or similar laws, including where applicable, the United States
Longshoremen’s and Harbor Workers’ Act, the Federal Employers’ Liability Act
and the Jones Act. Employers’ Liability insurance shall have limits of not less
than $1,000,000 per accident, $1,000,000 disease-policy limit and $1,000,000
disease-each employee.


 


Commercial
General Liability


 


Insurance providing
coverage for bodily injury, property damage and personal/advertising injury
with a combined single limit of not less than $1,000,000 per occurrence and
$2,000,000 aggregate. The policy shall include contractual liability and any
testing operations coverage.


 


a.                         Automobile Liability - Insurance for owned,
non-owned and hired automobiles with a limit of not less than $1,000,000 per
occurrence.


 


b.                        Excess liability - Insurance with a minimum
limit of $10,000,000 per occurrence and annual aggregate.


 


c.                         Evidence and Scope of Insurance - Supplier
shall provide Purchaser with a copy of insurance original certificates
evidencing the insurance coverages required and shall provide replacement
certificates of insurance within five (5) days of any renewal of the
required insurance.


 


All such insurance policies shall:


 


(i) name Purchaser
for their respective rights and interests in respect of the Project as
additional insured (except in the case of worker’s compensation insurance);


 


(ii) provide
Purchaser with 30 days’ prior written notice of non-renewal, cancellation of,
or significant modification to, any of such policies (except that such notice
period will be 10 days in case of non-payment of premiums); and


 


(iii) the insurance
certificates provided to Purchaser shall indicate that the insurance policies
have been endorsed as noted above. All


 


17

















 


policies shall be written
by one or more insurance companies authorized to do business in USA and be
rated BBB+ or higher by A.M. Best.


 


Term and
Modification of Insurance


 


If the designated
coverage, or relatively comparable coverage, are unavailable on reasonable
commercial terms, Supplier will provide Purchaser detailed information as to
the maximum amount of available coverage that it is able to purchase and will
be required to obtain Purchaser’s consent as to the adequacy of said coverage
under the circumstances at the time, which consent shall not be unreasonably
withheld or delayed.


 


10.3.2      Purchaser Insurance.


 


Purchaser shall carry and
maintain or cause to be carried and maintained, at all times during the Term of
this Agreement, insurance coverage with limits as set forth in this Section.


 


Builder’s
All Risk Insurance


 


At all times during
construction, the Purchaser’s Project will be under a builder’s all risk
insurance in an amount equal to the full replacement value of the Project for “all
risks” of physical loss or damage including, but not limited to, coverage for
earth movement, flood, windstorm, earthquake, sabotage, terrorism, riots, civil
commotion, testing, boiler and machinery, transit and off-site storage. The
policy may contain separate sub limits and deductibles subject to insurance
company underwriting guidelines. Deductibles under the policy shall not exceed
$100,000 per occurrence, except for deductibles for natural catastrophe peril,
which shall not exceed five percent (5%) of the insured loss


 


Increased cost of working
- the additional expenditure necessarily and reasonably incurred for the
purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Workers
Compensation


 


Coverage shall comply with
any statutory obligation imposed by Workers Compensation, Occupational Disease
Laws, or similar laws, including where applicable, the United States
Longshoremen’s and Harbor Workers’ Act, the Federal Employers’ Liability Act
and the Jones Act. Employers’ Liability insurance shall have limits of not less
than $1,000,000 per accident, $1,000,000 disease-policy limit and $1,000,000
disease-each employee.


 


18

















 


Commercial
General Liability


 


Insurance providing coverage
for bodily injury, property damage and personal/advertising injury with a
combined single limit of not less than $1,000,000 per occurrence and $2,000,000
aggregate. The policy shall include contractual liability and any testing
operations coverage.


 


a.             Automobile
Liability - Insurance for owned, non-owned and hired automobiles
with a limit of not less than $1,000,000 per occurrence.


 


b.             Excess
liability - Insurance with a
minimum limit of $10,000,000 per occurrence and annual aggregate.


 


c.             Evidence
and Scope  of
Insurance


 


Purchaser shall provide
Supplier with a copy of insurance original certificates evidencing the
insurance coverages required and shall provide replacement certificates of
insurance within five (5) days of any renewal of the required insurance.


 


All such insurance
policies shall:


 


(i) name
Supplier for their respective rights and interests in respect of the Project as
additional insured (except in the case of worker’s compensation insurance);


 


(ii) provide
Supplier with 30 days’ prior written notice of non-renewal, cancellation of, or
significant modification to, any of such policies (except that such notice
period will be 10 days in case of non-payment of premiums); and


 


(iii) The
insurance certificates provided to Supplier shall indicate that the insurance
policies have been endorsed as noted above. All policies shall be written by
one or more insurance companies authorized to do business in USA and be rated
BBB+ or higher by A.M. Best.


 


Term and
Modification of Insurance


 


If the designated
coverage, or relatively comparable coverage, are unavailable on reasonable
commercial terms, Purchaser will provide Supplier detailed information as to
the maximum amount of available coverage that it is able to purchase and will
be required to obtain Supplier’s consent as to the adequacy of said coverage
under the circumstances at the time, which consent shall not be unreasonably
withheld or delayed.


 


19

















 


ARTICLE
11


 


REPRESENTATIONS
AND WARRANTIES OF SUPPLIER


 


Supplier hereby
represents and warrants to Purchaser as follows:


 


11.1         Due Organization: Good Standing.
Supplier is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware, and qualified to conduct business in
the states where it does business.


 


11.2         Due Authorization. The
execution, delivery and performance of this Agreement by Supplier have been
duly authorized by all necessary corporate action on the part of Supplier and
do not and will not require the consent of any trustee or holder of any
indebtedness or other obligation of Supplier or any other Party to any other
agreement with Supplier.


 


11.3         Execution and Delivery. This
Agreement has been duly executed and delivered by Supplier. This Agreement
constitutes the legal, valid and binding obligation of Supplier, enforceable
against Supplier in accordance with its terms, except to the extent that its
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the rights of creditors generally or
by principles of equity.


 


11.4         Governmental Approvals. No
governmental authorization, approval, order, license, permit, franchise or
consent, and no registration, declaration or filing with any Governmental
Authority is required on the part of Supplier in connection with the execution,
delivery and performance of this Agreement, except those which have already
been obtained or which Supplier anticipates will be timely obtained in the
ordinary course of performance of this Agreement.


 


11.5         Supply Items: Services. The
Supply Items and the SCADA System to be delivered hereunder shall be designed
and fit for the purpose of generating electric power when operated in
accordance with the Turbine Specifications, the OMS Manual, Prudent Electrical
Industry Practices and Prudent Wind Industry Practices. The Supply Items and
SCADA System shall be new and unused and shall be free from Defects and free
from defects in title. The Services shall be performed in a competent, diligent
manner in accordance with Prudent Wind Industry Practices, Supplier’s
manufacturers’ written requirements and applicable Governmental Requirements.


 


ARTICLE
12


 


REPRESENTATIONS
AND WARRANTIES OF PURCHASER


 


Purchaser represents and
warrants to Supplier as follows:


 


12.1         Due Organization: Good Standing:
Qualified To Do Business. Purchaser is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and qualified to conduct business in the states where it does
business.


 


20

















 


12.2         Due Authorization. The
execution, delivery and performance of this Agreement by Purchaser have been
duly authorized by all necessary action on the part of Purchaser in accordance
with Purchaser’s organizational documents and do not and will not require the
consent of any trustee or holder of any indebtedness or other obligation of
Purchaser or any other Party to any other agreement with Purchaser.


 


12.3         Execution and Delivery. This
Agreement has been duly executed and delivered by Purchaser. This Agreement
constitutes the legal, valid and binding obligation of Purchaser, enforceable
against Purchaser in accordance with its terms, except to the extent that its
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the rights of creditors generally or
by principles of equity.


 


12.4         Governmental Approvals. No
governmental authorization, approval, order, license, permit, franchise or
consent, and no registration, declaration or filing with any Governmental
Authority is required on the part of Purchaser in connection with the
execution, delivery and performance of this Agreement, except those which have
already been obtained or which Purchaser anticipates will be timely obtained in
the ordinary course of performance of this Agreement.


 


12.5         Project Site. On or prior to the
date that Supplier is to provide any services relating to the Project at the
Project Site, Purchaser shall have obtained the right and authority to have
such work performed on the Project Site. To the knowledge of Purchaser, after
the completion of reasonable due diligence on the Project Site, the Project
Site is free of all hazardous or dangerous materials or substances. All
information concerning the Project Site and the wind flow across the Project
Site heretofore delivered to Supplier by Purchaser is true, complete and
correct in all material respects.


 


ARTICLE
13


 


MUTUAL
INDEMNITY


 


13.1         Mutual Indemnity. Each of
Supplier and Purchaser agree to defend, indemnify and hold each other, and each
other’s lenders, parent companies, Affiliates, officers, directors, agents and
employees, harmless from and against any claims, losses, damages and liabilities
(including, but not limited to, reasonable attorneys’ fees and court costs, but
excluding consequential damages) on account of any claim by a third Party for
bodily injury or property damage against the indemnified Party to the extent
caused by the negligent act or omission, or willful misconduct of, or breach of
this Agreement by, the indemnifying Party or the indemnifying Party’s
employees, contractors, subcontractors or agents, in connection with the
performance of their respective obligations under this Agreement.


 


ARTICLE
14


 


DEFAULT;
CURE; REMEDIES


 


14.1         Default by Supplier. Supplier
shall be in default under this Agreement should any one or more of the
following events or conditions arise or exist:


 


21

















 


 


(i)            Supplier becomes insolvent, or
generally does not pay its debts as they become due, or admits in writing its
inability to pay its debts, or makes a general assignment for the benefit of
creditors; or


 


(ii)           Insolvency, receivership, reorganization,
or bankruptcy proceedings are commenced by or against Supplier and, in the case
of any such involuntary proceeding, that is not dismissed or stayed within
sixty (60) days after it is commenced; or


 


(iii)          Supplier fails, for any reason, other
than failure of Purchaser to make payments to Supplier when obligated in
accordance with this Agreement, to make any undisputed payments required to be
made by Supplier to Purchaser, which failure continues for ten (10) Business
Days after notice of such non-payment; or


 


(iv)          Supplier is in material default of any
term or provision of this Agreement or has materially failed to perform its
obligations under this Agreement, and such breach or failure continues for
thirty (30) Business Days following receipt of written notice from Purchaser to
cure such breach or failure; provided, however, if such failure cannot with due
diligence be remedied by Supplier within such thirty (30) Business Days period,
and Supplier shall have diligently prosecuted the remedying of such failure
within such thirty (30) Business Days, such period shall be extended by such
additional time period as may be reasonably required by Supplier to cure such
failure.


 


14.2         Purchaser’s Remedies. In the
event Supplier is in default pursuant to Section 14.1, and said
default is not timely cured within the time periods set forth above, Purchaser,
in addition to those rights and remedies that may be available to Purchaser at
law or in equity, and subject to Section 9.2 of this Agreement,
shall have the right to terminate this Agreement by written notice to Supplier;
provided however, that amounts applicable to Supply Items delivered or services
performed by Supplier through the date of termination of this Agreement shall
be paid by Purchaser to Supplier.


 


14.3         Default by Purchaser. Purchaser
shall be in default under this Agreement should any one or more of the
following events or conditions arise or exist:


 


(i)            Purchaser or Guarantor becomes
insolvent, or generally does not pay its debts as they become due, or admits in
writing its inability to pay its debts, or makes a general assignment for the
benefit of creditors; or


 


(ii)           Insolvency, receivership,
reorganization or bankruptcy proceedings are commenced by or against Purchaser
or Guarantor and, in the case of any such involuntary proceeding, that is not
dismissed or stayed within sixty (60) days after it is commenced; or


 


(iii)          Purchaser fails to timely pay to
Supplier any required payment under this Agreement when due, including failure
to timely provide any Down Payment or any Progress Payment, which failure
continues for ten (10) days after written notice of failure to make
payment has been received by Purchaser from Supplier; or


 


22

















 


(iv)          Purchaser fails to perform any
material term or provision of this Agreement, including failure to timely
provide the Guaranty to Supplier, and such failure continues for thirty (30)
Business Days following receipt of written notice from Supplier to cure such
failure; provided, however, if such failure cannot with due diligence be
remedied by Purchaser within such thirty (30) Business Day period, and
Purchaser shall have diligently prosecuted the remedying of such failure within
such thirty (30) Business Days, such period shall be extended by such
additional time period as may be reasonably required by Purchaser to cure such
failure; or


 


(v)           The revocation or other termination
of the Guaranty by Guarantor, or the breach by Guarantor of any material term
or provision of the Guaranty, including any payment obligation thereunder,
which breach continues for a period of ten (10) days after written notice
of such breach has been received by Guarantor from Supplier.


 


14.4             Supplier’s Remedies. In the
event that Purchaser is in default pursuant to Section 14.3, and
said default is not timely cured within the time periods set forth above,
Supplier, in lieu of any rights and remedies that may be available to Supplier
at law or in equity, shall have the right to terminate this Agreement by written
notice to Purchaser, which termination shall be effective upon delivery of
Supplier’s notice to Purchaser. Within three (3) Business Days of the
effective date of such termination, Purchaser shall pay to Supplier the
liquidated damages set forth on the termination schedule attached hereto as
Exhibit G (“Termination Schedule”), which shall constitute Supplier’s exclusive
remedy, and Supplier shall have no right to damages or compensation for such
termination other than payment of the liquidated damages set forth on the
Termination Schedule.


 


14.5             Cancellation Due to a Force
Majeure Event. If Supplier is entirely prevented from performing its
obligations hereunder for a period of one-hundred eighty (180) consecutive days
as a result of the occurrence of a Force Majeure Event suffered by Supplier,
then Supplier may cancel, without additional liability, any then remaining
unperformed portion of this Agreement, upon not less than thirty (30) Business
Days’ prior written notice to the Purchaser; provided, however, that nothing in
this Section 14.5 shall relieve or excuse Supplier from its
obligations under Article 7 of this Agreement in respect of the
occurrence of a Force Majeure Event or relieve either Party from any payment
obligation that has accrued as of the date of cancellation or prior thereto;
provided further, however, that any payment obligations of Purchaser shall be
reduced by the amount of funds received by Supplier, if any, in connection with
the resale of any Turbines or Turbine components sold that are applicable to
such payment obligations of Purchaser, and, if following such reduction,
Purchaser is owed a refund of some portion of the Purchase Price from Supplier,
Supplier shall refund to Purchaser the applicable amount of Purchase Price previously
paid to Supplier within thirty (30) days of such termination.


 


14.6         Termination *****. Purchaser
shall have the right, only at any time up to, and not later than, ***** prior
to the scheduled date for Delivery of the first Major Turbine Component to be
Delivered under this Agreement pursuant to the Delivery Schedule, upon the
occurrence of a *****, to terminate all of the Turbine Supply Documents upon *****
prior written notice to Supplier. *****


 


23

















 


*****. Upon written notice from Purchaser, Supplier
shall use commercially reasonable efforts to provide Purchaser with *****
reasonably requested by Purchaser regarding *****. In the event that the
Parties disagree whether a ***** has occurred, the matter shall be resolved in
accordance with the dispute resolution procedures set forth in Article 15
of this Agreement. If a ***** occurs prior to ***** prior to the scheduled
Delivery Date of the first Major Turbine Component, such ***** shall not exist
in the Turbines to be Delivered in accordance with this Agreement.


 


14.7         Termination for Convenience. The
Purchaser shall have the right to terminate this Agreement for convenience with
respect to any Turbine until title to such Turbine has passed to Purchaser. Such
termination shall be effective upon the later to occur of (i) delivery to
Supplier of written notice of termination and (ii) receipt by Supplier of
liquidated damages in the amount on a per Turbine basis with respect to such
Turbine in accordance with the Termination Schedule attached to this Agreement
as Exhibit G.


 


14.8         Surviving Obligations.
Cancellation or expiration of all or any portion of this Agreement (a) shall
not relieve Purchaser of its obligations with respect to the confidentiality of
Supplier’s proprietary information as set forth in Section 4.5 of
this Agreement, or either Party of its confidentiality obligations as set forth
in Section 16.9 of this Agreement, (b) shall not relieve
either Party of any obligation hereunder which expressly or by implication
survives termination hereof, and (c) except as otherwise provided in any
provision of this Agreement expressly limiting the liability of either Party,
shall not relieve either Purchaser or Supplier of any obligations or
liabilities for loss or damage to the other Party arising out of or caused by
acts or omissions of such Party prior to the effectiveness of such termination
or arising out of such termination, and shall not relieve Supplier of its
obligations as to portions of the items supplied or other services hereunder
already supplied or performed or of obligations assumed by Supplier prior to
the date of termination. This Article shall survive the termination or
expiration of this Agreement.


 


ARTICLE
15


 


DISPUTE
RESOLUTION


 


15.1     Procedure. In the event a dispute,
controversy or claim (herein, a “dispute”) arises between Purchaser and
Supplier relating to this Agreement, the aggrieved Party shall promptly provide
written notification of the dispute to the other Party within ten (10) days
after such dispute arises and the Parties shall resolve such dispute as
provided herein:


 


15.1.1   Executives Meeting. A meeting shall be
held between the Parties, attended by representatives of the Parties with
decision-making authority regarding the dispute, to attempt in good faith to
negotiate a resolution of the dispute. Such meeting shall be held in
Carpinteria, California within thirty (30) days after a notice of dispute has
been delivered under Section 15.1 above.


 


24














 


15.1.2  Independent Engineer’s
Decision. If the dispute involves a technical issue, within ten
(10) days after such meeting, the Parties have not resolved the dispute,
either Party shall submit the dispute to the Independent Engineer for a
non-binding determination, together with such information in support of their
position as may be relevant, which information will simultaneously be sent to
the other Party. The Independent Engineer may hold separate meetings with each
Party or call a joint meeting of the Parties, to be held in Carpinteria,
California. The Independent Engineer shall, within thirty (30) days after such
request for a determination, issue a non-binding decision. Any Party which does
not wish to comply with such decision shall promptly provide written
notification of its intention to the other Party within five (5) days of
such decision. The Parties shall meet in Chicago, Illinois within twenty (20)
days of such notice to attempt, in good faith, to negotiate a final resolution
to the dispute. Any Party which does not wish to comply with such decision
shall within ten (10) days after the date of such meeting submit the
dispute to arbitration within twenty (20) days after the date of such decision
to arbitration in accordance with Section 15.1.3 below. The Parties
shall share equally the costs of the Independent Engineer.


 


15.1.3  Arbitration.


 


(a)       If the
Parties are not successful in resolving a dispute, controversy or claim
pursuant to Sections 15.1.1 and 15.1.2, above, then such dispute
shall be resolved through binding arbitration to take place in Chicago,
Illinois. The Parties agree to conduct all arbitration proceedings in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association. This Section 15.1.3 is governed by the
Federal Arbitration Act.


 


(b)       A Party desiring to
submit to arbitration any such dispute, controversy or claim shall furnish its
demand for arbitration in writing to the other Party or Parties thereto, which
demand shall contain a brief statement of the matter in controversy, as well as
a list containing the names of three (3) suggested arbitrators from the
list of arbitrators maintained by the American Arbitration Association (the
“AAA List”) from which list, or from other sources, all of the Parties shall
choose one (1) mutually acceptable arbitrator. If the Parties are unable
to agree upon the identity of a single arbitrator, within ten (10) days
from the receipt of such demand, the Purchaser and the Supplier shall each
(collectively, the “Arbitrating Parties”), within a period of five
(5) additional days, name from the AAA List one (1) arbitrator by
written notice to the other Arbitrating Party or Parties. Within ten
(10) days after this notice, the two (2) arbitrators so named shall
choose a third arbitrator. If any Arbitrating Party fails to name an arbitrator
within the specified five (5) day period or if the two arbitrators chosen
by the Arbitrating Parties fail to select a third arbitrator within the ten
(10) day period, then either Arbitrating Party, on behalf of and on notice to
the other Arbitrating Party or Parties, may request appointment by the American
Arbitration Association in accordance with its rules then prevailing of
the required additional arbitrator or arbitrators so that there shall be a
panel of three (3) arbitrators. If the American Arbitration Association
should fail to appoint the necessary arbitrator or arbitrators within fifteen
(15) days after such request is made, then either Arbitrating Party may apply,
on notice to the other Arbitrating Party or Parties, to a court of competent
jurisdiction for the appointment of such necessary additional arbitrators. Each
of the arbitrator or arbitrators chosen or appointed pursuant to this Section 15.1.3(b) shall
be a person having at least ten (10) years experience in the United States in
the legal profession and shall


 


25

















 


not be a past or
present officer, director or employee of, or have any material interest in, any
Arbitrating Party or any Affiliate of an Arbitrating Party. All discovery,
including the right to take depositions and interrogatories, shall be permitted
in the time and manner provided by the then applicable Federal Rules of
Civil Procedure. The Arbitrating Parties shall be entitled to reasonable
discovery prior to the arbitration hearing, and the arbitrator or arbitrators,
as the case may be, shall have the power upon application of any Arbitrating
Party to make all appropriate orders for discovery from the other Arbitrating
Party, including discovery of documents, responses to interrogatories, and
depositions. The scope, time and manner of discovery, including all document
discovery, are to be in accordance with the U.S. Federal Rules of Civil
Procedure. Notwithstanding the foregoing, discovery allowed each of the
Arbitrating Parties shall not exceed: (i) five (5) party depositions;
(ii) three (3) nonparty depositions; (iii) three
(3) depositions of any experts selected to give opinions in the
arbitration (as well as the production of any documents relied upon by such
experts); and (iv) fifteen (15) interrogatories (with each subpart counted
as a separate interrogatory). Discovery shall not include requests for
admissions. No deposition shall last more than two (2) days in length.
Further, all discovery must, without exception, be completed within one hundred
twenty (120) days from the date the arbitration panel is appointed. Any
documents that are not produced to the other Arbitrating Party prior to the
termination of this 120-day discovery period may not be offered into evidence
at the arbitration hearing unless such production shall not prejudice the
non-producing Arbitrating Party as determined by the arbitrator or arbitrators,
as the case may be. Likewise, any witnesses who have not been produced for
deposition, despite a request from the other side, may not testify or submit
affidavits at the arbitration hearing.


 


(c)       The arbitrator or
arbitrators, as the case may be, shall render his, her or their decision, in
the latter case upon the concurrence of at least two (2) of their number,
as soon as possible but no later than thirty (30) days after the conclusion of
any hearings before such arbitrator or arbitrators, as the case may be, unless
such 30-day period is extended by the arbitrator or arbitrators, as the case
may be. The decision and award shall in either case be in writing and
counterpart copies of such decision shall be delivered to each of the
Arbitrating Parties. Such decision shall be based solely upon the written
arguments and contentions, evidence and legal authorities, submitted by each
Arbitrating Party. In rendering such decision and award, the arbitrator shall
not add to, subtract from or otherwise modify the provisions of this Agreement.
Any award rendered shall be final and conclusive upon the parties and a
judgment on any such award may be entered in any court having jurisdiction,
state or federal, having jurisdiction. No arbitration proceeding shall be
commenced after the date when institution of legal or equitable proceedings
based upon such subject matter would be barred by the applicable statute of
limitations. Notwithstanding anything to the contrary contained in this section
or elsewhere in this Agreement, provisional injunctive or other provisional equitable
relief may be sought by the parties without first submitting the subject
dispute to arbitration so long as injunctive relief is otherwise warranted by
applicable law.


 


15.2     Qualifications of
Arbitrators; Expenses.


 


(a)       The arbitrators in the
arbitration proceeding provided for in this Article 15 shall be
individuals experienced in the energy construction industry and competent to
pass on the matter presented for arbitration.


 


26

















 


(b)       Supplier, on the one
hand, and Purchaser, on the other, shall share equally the compensation and
expenses of the arbitrators as well as all fees imposed by the AAA. Supplier
and Purchaser shall be responsible for their own costs and legal fees, if any.
Notwithstanding the foregoing, a majority of the arbitrators shall be empowered
to award the prevailing Party its costs, expenses and/or legal fees.


 


15.3     Performance During
Dispute. While any controversy, dispute or claim arising out of or relating
to this Agreement is pending, Purchaser and Supplier shall continue to perform
their obligations hereunder notwithstanding such controversy, dispute or claim.


 


15.4     Consolidation. No
arbitration arising under this Agreement shall include, by consolidation,
joinder or any other manner, any person or entity not a Party to this
Agreement, unless (a) such person or entity is substantially involved in a
common question of fact or law, (b) the presence of such person or entity
is required if complete relief is to be accorded in the arbitration, and
(c) such person or entity has consented to such inclusion.


 


15.5     Language. All
arbitration proceedings shall be conducted in the English language.


 


ARTICLE 16


 


GENERAL PROVISIONS


 


16.1     Waiver. No delay
or omission by the Parties hereto in exercising any right or remedy provided
for herein shall constitute a waiver of such right or remedy nor shall it be
construed as a bar to or waiver of any such right or remedy on any future
occasion.


 


16.2     Successors and Assigns.
This Agreement shall be binding upon and shall inure to the benefit of the
successors and permitted assigns of Supplier and Purchaser. Except as set forth
herein, neither Supplier nor Purchaser may assign, convey or transfer this
Agreement, in whole or in part, except upon the prior written consent of the
other Party hereto, which consent shall not be unreasonably withheld, and any
such purported transfer or assignment shall be null and void. Notwithstanding
any permitted assignment hereunder, the assignor shall remain liable to the other
Party for all duties and responsibilities hereunder unless affirmatively
recited by the other Party.


 


16.3     Permitted Assignments.
Notwithstanding Section 16.2 above, (i) either Party may
transfer or assign its rights, benefits and obligations under this Agreement to
an Affiliate; provided, that if requested by Purchaser, Supplier shall execute
and deliver a guaranty of the performance hereunder by such an assignee,
(ii) Purchaser may assign its rights, benefits and obligations under this
Agreement to any purchaser of the Project; provided, that Purchaser may not
transfer or assign this Agreement in whole or in part to a wind turbine design
or manufacturing competitor of Supplier without the prior written consent of
Supplier, which consent may be withheld in Supplier’s sole discretion and which
may be conditioned upon the creditworthiness of the purchaser,
(iii) Supplier is authorized to subcontract any portion of its duties
under this Agreement to a third party or to delegate its obligations hereunder,
in the ordinary course of its business, without reducing the scope of
Supplier’s undertakings, obligations, and commitments to Purchaser, provided
that Supplier agrees that it will not use any supplier for any Major Turbine
Components not listed on Exhibit H without Purchaser’s advance
written consent, such consent not to be unreasonably withheld,


 


27

















 


conditioned or
delayed, and (iv) a Party, without the consent of the other Party, may
assign its interest in this Agreement to a lender, collateral trustee, security
trustee or similar entity as collateral security for any financing entered into
by the assigning Party, including a lease financing. The non-assigning Party
shall, upon fifteen (15) days’ prior written request from the assigning Party,
execute a consent containing customary terms and conditions, to any such
collateral assignment. Further, notwithstanding Section 16.2 above,
Purchaser shall have the right to assign no less than all of its rights, duties
and obligations under the Turbine Supply Documents to any third party, subject
to, and conditioned upon, the prior written consent of Supplier, which shall
not be unreasonably withheld, conditioned, or delayed; provided however that
any such assignment is conditioned upon the receipt of a guarantee for the
benefit of Supplier of the performance of the contract obligations, including
payment security, in a form acceptable to Supplier, in its sole and absolute
discretion. Any such assignment to a third party also shall be subject to the
following: (i) prior to the effectiveness of such assignment, the third
party assignee shall agree to revisions to the Turbine Supply Documents as
determined by Supplier to be reasonably necessary, to effect the purchase and
installation of the Turbines by the third party assignee at a project site to
be determined between Supplier and any such third party assignee, (ii) the
third party assignee shall assume all of the duties, obligations, restrictions
and covenants of Purchaser under the Turbine Supply Documents, as revised,
(iii) any monies or other consideration received by, or otherwise payable
to, Purchaser from the third party assignee in connection with such assignment,
in excess of the Down Payment and any Progress Payments actually paid by
Purchaser to Supplier, other than the reasonable actual documented expenses
incurred by Purchaser in connection with the assignment of the Turbine Supply
Documents to the third party, shall be paid to Supplier and (iv) Purchaser
shall pay to Supplier all of Supplier’s costs associated with such assignment
from Purchaser to the third party assignee, including but not limited to all of
Supplier’s costs (including reasonable legal fees) incurred in connection with
the revision of the Turbine Supply Documents, within thirty (30) days of
receipt of an applicable invoice from Supplier.


 


16.4     Notices.


 


(a)       Any notice required or
authorized to be given hereunder or any other communications between the
Parties provided for under the terms of this Agreement shall be in writing
(unless otherwise provided) and shall be served personally or by reputable
express courier service or by facsimile transmission addressed to the relevant
Party at the address stated below or at any other address notified by that
Party to the other as its address for service. Any notice so given personally
shall be deemed to have been served on delivery, any notice so given by express
courier service shall be deemed to have been served two (2) Business Days
after the same shall have been delivered to the relevant courier, and any
notice so given by facsimile transmission shall be deemed to have been served
on dispatch. As proof of such service it shall be sufficient to produce a
receipt showing personal service, the receipt of a reputable courier company
showing the correct address of the addressee or an activity report of the
sender’s facsimile machine showing the correct facsimile number of the Party on
whom notice is served and the correct number of pages transmitted.


 


28

















 


(b)       The Parties’ addresses
for service are:


 


	
  To
  Purchaser:

  	
   

  	
  UPC
  Wind Acquisition V, LLC

  
	
   

  	
   

  	
  c/o
  UPC Wind Management, LLC

  
	
   

  	
   

  	
  85
  Wells Ave., Suite 305

  
	
   

  	
   

  	
  Newton,
  MA 02459

  
	
  Attn:

  	
   

  	
  General
  Counsel

  
	
   

  	
   

  	
  Facsimile:
  

  	
  (617)
  964-3342

  
	
   

  	
   

  	
  Telephone:
  

  	
  (617)
  964 3340

  
	
   

  	
   

  	
   

  	
   

  
	
  To
  Supplier:

  	
   

  	
  Clipper
  Turbine Works, Inc.

  
	
   

  	
   

  	
  6305
  Carpinteria Avenue, Suite 300

  
	
   

  	
   

  	
  Carpinteria,
  California 93013

  
	
   

  	
   

  	
  Attn:
  

  	
  General
  Counsel

  
	
   

  	
   

  	
  Facsimile:
  

  	
  805.899.1115

  
	
   

  	
   

  	
  Telephone:
  

  	
  805.690.3275

  
	
   

  	
   

  	
   

  	
   

  
	
  with
  a copy to:

  	
   

  	
  Chadbourne &
  Parke LLP

  
	
   

  	
   

  	
  300
  South Grand Avenue, Suite 3300

  
	
   

  	
   

  	
  Los
  Angeles, CA 90071

  
	
   

  	
   

  	
  Attn:
  

  	
  Edward
  W. Zaelke

  
	
   

  	
   

  	
  Facsimile:
  

  	
  213.622.9865

  
	
   

  	
   

  	
  Telephone:
  

  	
  213.892.1000

  



 


16.5     Governing Law.
This Agreement and all matters arising hereunder or in connection herewith
shall be governed by and construed in accordance with the laws of the State of
New York, without regard to conflicts of law principles.


 


16.6     Amendments. This
Agreement may be modified or amended only by an instrument in writing signed by
the Parties hereto.


 


16.7     Attachments
Incorporated. The preamble and recitals of this Agreement, and the Exhibits
attached hereto, are hereby incorporated into and made a part of this
Agreement.


 


16.8     Entire Agreement.
The terms and conditions set forth herein, together with those set forth on all
Exhibits attached hereto, constitute the complete statement of the agreement
between Supplier and Purchaser relating to the subject matter hereof. No prior
statement or correspondence shall modify or affect the terms and conditions
hereof. Prior representations, promises, warranties or statements by Supplier
or Purchaser, or by any agent or employee of Supplier or Purchaser, that differ
in any way from the terms and conditions hereof shall be given no effect.


 


16.9     Confidentiality.
Each Party agrees to keep the terms and provisions of this Agreement and all
materials and information that each receives pursuant hereto or in connection
herewith or in connection with the Project in the strictest confidence and not
to disclose any of the foregoing to any party other than the respective
lenders, investors, attorneys, accountants, Affiliates, officers and directors
of each Party or as such Party may be required by law, court order or in any
litigation to disclose. This Section 16.9 shall survive the
termination of this Agreement. Notwithstanding the foregoing, Supplier shall be
entitled to announce by press release or other means that it has agreed to
furnish the Turbines for the Project. The Parties agree that, with respect to
press releases concerning the Project, they will endeavor to cooperate and
share information with one another so that the Parties are identified, to the
extent practicable in press releases regarding the


 


29

















 


Project. Supplier
and Purchaser will each provide copies of all press releases issued regarding
the Project to the other. Furthermore, the restrictions of this Section 16.9
shall not prohibit or restrict Supplier from using or disclosing the availability
and performance data from the Project in connection with its sales, maintenance
and other internal purposes; provided, however, that no specific reference
shall be made to the Project in connection with the disclosure of such data.


 


16.10   Counterparts. This
Agreement may be executed by the Parties in one or more counterparts, all of
which taken together, shall constitute one and the same instrument. The
exchange of copies of this Agreement and of signature pages by facsimile
transmission shall constitute effective execution and delivery of this
Agreement as to the Parties and may be used in lieu of the original Agreement
for all purposes (and such signatures of the parties transmitted by facsimile
shall be deemed to be their original signatures for all purposes).


 


16.11   English Language
Documents. Any document, manual, certificate or notice required or
authorized to be given hereunder for the operation of the Project shall be
provided in the English language.


 


16.12   Severability. In
case any provision in this Agreement is held to be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not be affected.


 


16.13   Headings. The
headings and captions used in this Agreement are inserted for reference and
convenience only and the same shall not limit or construe the sections,
articles or paragraphs to which they apply or otherwise affect the
interpretation thereof.


 


16.14   Agreement Revisions.
Following the execution of this Agreement by the Parties, if either Party
requests a change to the Agreement in order to (i) correct any
inconsistency contained within the Agreement or among the Turbine Supply
Documents or (ii) clarify any ambiguities in the Agreement to reflect the
intent of the Parties, then the Parties agree to work in good faith to amend
the language of the Agreement to conform to any such requested change.


 


30

















 


IN WITNESS
WHEREOF, this Agreement has been executed and delivered by the duly authorized representatives
of Purchaser and Supplier as of the date first written above.


 


 


	
   

  	
  CLIPPER TURBINE WORKS, INC.,

  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  UPC WIND ACQUISITION V, LLC,

  a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Gaynor

  
	
   

  	
  Name:

  	
  Paul Gaynor

  
	
   

  	
  Title:

  	
  President

  



 


[Signature Page to Turbine 

Supply Agreement]


 


31

















 


IN WITNESS
WHEREOF, this Agreement has been executed and delivered by the duly authorized
representatives of Purchaser and Supplier as of the date first written above.


 


	
   

  	
  CLIPPER TURBINE WORKS, INC., 

  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Gates

  
	
   

  	
  Name:

  	
  Robert Gates

  
	
   

  	
  Title:

  	
  Sr. Vice Pres

  
	
   

  	
   

  
	
   

  	
  UPC WIND ACQUISITION V, LLC, 

  a Delaware limited liability company

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  



 


 


UPC
2012


 


[Signature Page to Turbine

Supply Agreement]


 


32

















 


APPENDIX I


 


DEFINITIONS


 


“Additional Cost
Event” means (a) an Emergency, (b) a Force Majeure Event or an Operating Force
Majeure Event, (c) damage caused by an act or omission of the Owner or a third
party (other than an Affiliate, Subcontractor or other agents or designees of
the Operator) which is required to be repaired in order for the Turbines to be
operated and maintained in accordance with the standard set forth in this
Agreement, or (d) the receipt by the Operator of a written request from the
Owner for the Operator’s performance of Additional OMS Services.


 


“Affiliate” means,
with respect to any Party, any Person or entity which, directly or indirectly,
is in control of, or is controlled by, or is under common control with such
Party or any Subsidiary of such Party. For the purposes of this definition,
control of a Party shall mean the power, direct or indirect, (a) to vote in
excess of fifty percent (50%) or more of the securities having ordinary voting
power for the election of directors, (b) to direct or cause the direction of
the management and policies of such Party, whether by contract or otherwise.


 


“After Tax Value”
means an amount equal to the sum of any payment, credit or other original
amount (the “Original Amount”) plus an amount that will cause the recipient to
retain a sum equal to the Original Amount after federal income taxes at the
highest marginal rate are or would be imposed on the After Tax Value.


 


“Agreement” means
the Supply Agreement, the Warranty Agreement or the OMS Agreement, as the
context requires.


 


“Ancillary Parts
and Equipment” means those ancillary parts, materials and equipment listed in Exhibit
A to the Supply Agreement, which are typically required, together with the
Major Turbine Components, to form a Turbine.


 


“Annual Windsystem
Availability” or “AWA” has the meaning given in Exhibit A to the
Warranty Agreement.


 


“Availability” has
the meaning given in Exhibit A to the Warranty Agreement.


 


“Available Hours”
has the meaning given in Exhibit A to the Warranty Agreement.


 


“Average Nominal
Measured Energy” or “ANME” has the meaning given in Exhibit C to the
Warranty Agreement.


 


“AWA Period
Revenue” shall have the meaning given in Exhibit A to the Warranty
Agreement.


 


“Base Hours” has
the meaning given in Exhibit A to the Warranty Agreement.


 


“Business Days”
means Monday through Friday of each week, except holidays in which commercial
banks in the United States are required or permitted to close.


 


I-1

















 


“Change in Law”
means, after the date hereof the enactment, modification or repeal or any
Governmental Requirements, or any change in the interpretation of any
Governmental Requirements by any Governmental Authority or court of law, that
materially affects Supplier’s schedule for performing any of its obligations
hereunder; provided a change in applicable tax law shall not constitute a “Change
in Law” hereunder.


 


“Commencement
Date” means the date upon which the Supplier shall have timely received the
entirety of (a) the Down Payment, (b) the Parent Guaranty, and such other fees
as may be applicable.


 


“Commissioning” or
“Commissioning Work” means the installation inspection, field commissioning and
acceptance testing, and controller power-up test, and start-up work to be
conducted by Supplier under the Supply Agreement, for each Turbine, in
accordance with the Commissioning and Start-Up Procedures.


 


“Commissioning and
Start-Up Procedures” means the field commissioning and acceptable testing and
start-up test and inspection procedures set forth on Exhibit O of the
Supply Agreement.


 


“Commissioning
Certificate” means a certificate issued by Supplier to Purchaser, in the form
attached as Exhibit M to the Supply Agreement, following completion of
Commissioning of each Turbine.


 


“Complete” or
“Completion” shall mean, with respect to any Turbine, that (i) all Turbine
Components have been delivered to the Project Site and installed in accordance
with the Installation Procedures, (ii) Purchaser has completed the necessary
terminations and connections of the collection lines and the SCADA
communication lines into the controller in the base of the Turbine Tower using
the collection lines and SCADA communication lines supplied by Purchaser, and
(iii) the Turbine has been Commissioned.


 


“Completion
Schedule” shall mean the schedule for the completion by Supplier and Purchaser,
as applicable, of Turbine installation and Commissioning as set forth in Exhibit
T to the Supply Agreement.


 


“CPI” shall mean
the Consumer Price Index for the United States City Average, All Urban
Consumers (CPI-U), All Items (base index year 1982-1984=100), as published by
the United States Department of Labor, Bureau of Labor Statistics.


 


“Default Rate”
means a per annum rate of interest equal to the lesser of (a) the maximum rate
permitted by law and (b) twelve percent (12%) per annum.


 


“Defect” means a
defect in any part or component of a Turbine covered under the Standard
Warranty that causes such part or component to fail during the Warranty Period.
A component is deemed to have “failed” only when it either (i) breaks, or (ii)
ceases to perform the operation for which it was designed, intended or
installed; provided, however, that normal wear and tear shall not constitute
failure.


 


I-2

















 


“Delivery” or
“Delivered” means when a Supply Item is made available by Supplier for pickup
by Purchaser at its respective Designated Delivery Location, provided however,
that Purchaser may not take custody and control of the said Supply Item until
the applicable Progress Payment has been made by Purchaser and received by
Supplier.


 


“Delivery Schedule”
shall mean the schedule as set forth in Exhibit L to the Supply
Agreement for the Delivery by Supplier of the Supply Items to the Designated
Delivery Locations.


 


“Designated
Delivery Location” shall have the meaning given in Section 5.4 of the
Supply Agreement.


 


“Down Payment”
shall have the meaning given in Section 3.1 of the Supply Agreement.


 


“Down Payment
Date”, shall have the meaning given in Section 3.1 of the Supply
Agreement.


 


“Effective Date”
shall mean the date of the Supply Agreement.


 


“Electrical
Infrastructure” means the pad mounted transformers, feeder lines, high voltage
feeder lines, switches and all other related facilities owned by Purchaser
through which the electrical power generated by the Turbine is transferred from
the point of connection at the Turbine Controller to the Interconnection
Facilities.


 


“Emergency” means
an event occurring at the Project Site, or the Maintenance and Spare Parts
Facility or any adjoining property that poses actual or imminent risk of
serious personal injury or material physical damage to the Project, or parts
thereof, requiring immediate preventative or remedial action.


 


“Environmental
Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees,
judgments, injunctions, notices or binding agreements issued, promulgated or
entered into by any Governmental Authority, relating in any way to the
environment, preservation or reclamation of natural resources, the management,
environmental release or threatened environmental release of any Hazardous
Substance or to health and safety matters, including the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§
9601 et seq.; the Resource Conservation and Recovery Act, as the same may be
amended from time to time, 42 U.S.C. §§6901 et seq.; the Federal Water
Pollution Control Act, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control
Act, 15 U.S.C. §§ 2601 et seq.; the Clean Air Act, 42 U.S.C. §§ 7401 et seq.;
the Safe Drinking Water Act, 42 U.S.C. §§ 3803 et seq.; the Oil Pollution Act
of 1990, 33 U.S.C. §§ 2701 et seq.; the Emergency Planning and the Community
Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the Hazardous Material
Transportation Act, 49 U.S.C. §§ 1801 et seq. and the Occupational Safety and
Health Act, 29 U.S.C. §§ 651 et seq.; and any state and local counterparts or
equivalents, in each case as amended from time to time.


 


“EPC Contract”
means that certain agreement(s), if any, by and between Purchaser and EPC
Contractor(s), for the erection of the Turbine and the design, supply,
construction, installation and commissioning of (i) crane pads, laydown areas,
temporary construction roads


 


I-3

















 


and storage yards, (ii)
permanent roads, Turbine foundations and transformer foundations, (iii) the
Electrical Infrastructure, (iv) the SCADA System, including communication
lines, (v) any control and operation and maintenance buildings and facilities
(vi) and other civil and electrical elements and other work for the Project.


 


“EPC
Contractor(s)” means such person or entity selected by Purchaser as principal
contractor for performing work under the EPC Contract.


 


“Escrow Agent”
means such party as agreed upon by Supplier and Purchaser to serve as the
escrow agent.


 


“FAA” means the
Federal Aviation Administration.


 


“Final Assembly
Work” shall mean the final assembly work for the completion of Turbine
component assembly, as set forth in Exhibit P to the Supply Agreement,
prior to the installation of the Turbine.


 


“Financing
Documents” means the financing agreement, by and among the Purchaser or one of
its Affiliates, and the lenders or other financial institutions from time to
time party thereto by which the Purchaser or one of its Affiliates intends to
raise capital to finance the construction of the Project.


 


“Force Majeure
Event” means any event beyond the reasonable control of the Party affected
which materially affects its performance hereunder, including, without
limitation; war, hostilities, insurrection, riot, vandalism or other public
disorder or civil disturbance; terrorism; perils at sea, acts of God, fire,
hurricanes, tornadoes (including tornado watches or warnings for the Project
Site issued by the National Weather Service), mudslides, hail, earthquakes,
lightning, other extreme weather conditions, and, during Commissioning or
repairs, wind in excess of fifteen (15) meters per second or that would make
necessary lifting unsafe, but only for so long as such winds persist;
expropriation or confiscation; strikes, lockouts or other labor disputes;
perils at sea; or unforeseen delays in transportation or shipping, including
with respect to roadways, harbors, ports and other transportation and shipping
infrastructure; any Change in Law; or damage to any part of Supplier’s
factories or assembly plants, or the factories or assembly plants of its
Subcontractors. Force Majeure Events shall include those Force Majeure Events
experienced by any of Supplier’s Subcontractors in circumstances where Supplier
is not able to reasonably reallocate the work of that Subcontractor to an
alternative vendor.


 


“Germanischer
Lloyd” means Germanischer Lloyd Windenergie GMBH.


 


“Germanischer
Lloyd Turbine Certification”, “GL Certificate” or “GL Certified” means a
certification of the Turbine to be issued by Germanischer Lloyd.


 


“Governmental
Authority” means the government or any federal, state, municipal or other
political subdivision in which the Project is located, or any other
governmental or political subdivision thereof exercising jurisdiction over the
Project or, with respect to their rights and obligations hereunder or, with
respect to the Project, the Parties, including all agencies and
instrumentalities of such governments and political subdivisions.


 


I-4














 


“Governmental Requirements” means all laws, statutes, codes, rules,
regulations, orders, and decrees of any Governmental Authority in effect on the
date hereof, including all authorizations, consents, registrations, exemptions,
Permits and licenses with or from any Governmental Authority, applicable to the
Project or, with respect to their rights and obligations hereunder or with
respect to the Project, the Parties.


 


“Guarantor” means UPC Wind Partners, LLC as guarantor under that
certain Guaranty to be entered into between Supplier and UPC Wind Partners,
LLC.


 


“Hazardous Substances” means all explosive or radioactive substances or
wastes and all hazardous or toxic substances, wastes or other pollutants,
including petroleum or petroleum distillates, asbestos or asbestos containing
materials, polychlorinated biphenyls, radon gas, infectious or medical wastes
and all other substances or wastes of any nature regulated pursuant to any
Environmental Law.


 


“Independent Engineer” means Garrad Hassan, Germanischer Lloyd, the
National Renewable Energy Laboratory, or Global Energy Concepts, or such other
independent engineer as mutually agreed.


 


“Installation Procedures” means the procedures for the proper
(i) assembly, erection and installation of the Towers on the Turbine
foundations supplied by Purchaser, (ii) grouting of the Turbines to the Tower
foundations and tightening of all bolts using the appropriate torque; (iii) assembly,
erection and installation of the Turbine Nacelles and Turbine Blades upon the
Towers as specified in the Turbine Specifications, Prudent Wind Industry
Practices and Prudent Electrical Industry Practices; (iv) installation and
testing of the Turbine electrical cables, communication cables, and control
panels within the Turbine, and (v) connection of the cables from each
Turbine Nacelle to the main circuit breaker within the ground controllers, all
in accordance with the Turbine Installation Manual.


 


“Installation Work” means the work required pursuant to the
Installation Procedures to assemble, erect and install the Turbines.


 


“Intellectual Property Rights” means and refers to all patents,
copyrights, trademarks, service marks, trade secrets and all similar and
related intellectual property rights protected under any statutes, laws, codes,
rules or regulations and any licenses and other rights obtained by
Supplier or its Affiliates from third parties.


 


“Interconnection Facilities” means all the land rights, materials,
equipment and facilities to be installed by Purchaser for the purpose of interconnecting
the Turbines to the Project’s substation so as to permit the delivery of
electrical energy generated by the Turbines to the interconnection point within
the Project’s substation, which shall include, but shall not be limited to,
electrical interconnection, switching, metering, relaying, communication and
safety equipment.


 


“Lenders” shall mean those lenders providing financing for the Project.


 


“Maintenance and Spare Parts Facility” means the location from which
Operator will perform the OMS Services.


 


I-5

















 


“Major Turbine Components” means the Turbine Nacelle, Turbine
Controller, Turbine hub, Turbine Blades and Tower for each Turbine, as such
items are more particularly described in the Turbine Specifications.


 


*****


 


“Nominal Expected Energy” or “NEE” has the meaning given in Exhibit C
of the Warranty Agreement.


 


“Nominal Measured Energy” or “NME” has the meaning given in Exhibit C
of the Warranty Agreement.


 


“OMS Agreement” means that certain Operation and Maintenance Service
Agreement, executed or to be executed between Supplier (or an Affiliate of
Supplier) and Purchaser (or an Affiliate of Purchaser) of even date herewith,
pursuant to which Supplier (or an Affiliate of Supplier) will operate, maintain
and service the Turbines.


 


“OMS Manual” means the detailed operations, and maintenance service
manual for the Turbines supplied to Purchaser by Supplier, together with any
future updates and supplements thereto provided by Supplier.


 


“Operating Force Majeure Events” means any event beyond the reasonable
control of Supplier or Operator, as applicable, including, without limitation,
(i) war, hostilities, insurrection, riot, vandalism or other public
disorder or civil disturbance; acts of God, fires, hurricanes, thunder storms
(including thunder storm watches or warnings declared for the area including
the Project Site by the National Weather Service), tornadoes (including tornado
watches or warnings declared for the area including the Project Site by the
National Weather Service), mudslides, hail, earthquakes, lightning (including
lightning blade strikes), or explosions; expropriation or confiscation,
strikes, lockouts or other labor disputes, a Change in Law; epidemic or
quarantine; damage or obstruction to any part of the Project caused by persons
other than Supplier, its Affiliates or their respective Subcontractors; a
condition at the Site that would not reasonably have been discovered by a
project supplier comparable in experience to Supplier conducting a competent
and diligent visual inspection, (ii) wind velocity at a constant speed or
in gusts such that a reasonably prudent professional qualified operator engaged
in the business of performing routine maintenance on wind energy generation facilities
comparable to the Project owned by it, acting for the advancement and
protection of its own economic interests, would not make the required repair at
such time due to risks to persons or property, (iii) with respect to the
Turbines, any conditions at the Project Site that are either outside the
operating parameters or standards for an IEC Class IIB wind turbine, as
published as of the Effective Date by the IEC, or outside the operating
parameters or standards for the Turbine, as set forth in the Turbine Specifications,
which operating parameters or standards may include, without limitation,
conditions involving ambient temperatures or wind speed and/or turbulence at
the air density at the Project Site, (iv) delays caused by inclement weather
within the vicinity of the Project Site and affecting the operation of the
Project to the extent that such inclement weather is materially greater than
that normally experienced for the time of year and locality and (v) unavailability
of the grid for any reason not caused by Supplier. The failure to provide
Interconnection Facilities


 


I-6

















 


that are energized
and operational in a manner that will permit the transmission and sale of power
from a Turbine and related Electrical Infrastructure shall be deemed an
Operating Force Majeure Event with respect to such Turbine until such time as
the Interconnection Facilities are provided and sufficiently operational with
respect to each such Turbine.


 


“Operator” shall mean the person or entity hired by Project Manager to
operate the Project pursuant to the OMS Agreement.


 


“Party” and “Parties” has the meaning given in the Preamble to the
Supply Agreement.


 


“Permit” means any valid waiver, exemption, variance, franchise,
permit, authorization, license or similar order, of or from any federal, state,
county, municipal, local, regional, or other governmental body,
instrumentality, agency, authority, court or other body having jurisdiction
over the matter in question.


 


“Power Curve” means the energy values produced by the Turbines at the
various wind speed bands set forth in Exhibit C-2 of the Warranty
Agreement.


 


“Power Curve Warranty Buydown” means any payment made pursuant to Section 3.3(c) of
the Warranty Agreement.


 


“Progress Payment” shall have the meaning given in Section 3.3
of the Supply Agreement.


 


“Project” has the meaning given in the Recitals of the Supply
Agreement.


 


“Project Completion” shall occur upon the Completion of the Turbines.


 


“Project Completion Certificate” shall mean a certificate, in the form
attached as Exhibit N to the Supply Agreement, delivered by
Supplier to Purchaser following Completion of Commissioning of the Turbines.


 


“Project Site” means the site described in Exhibit Q of the
Supply Agreement.


 


“Proven Power Curve Percentage” or “PPCP” shall have the meaning given
in Exhibit B to the Warranty Agreement.


 


“Prudent Electrical Industry Practices” means those practices, methods,
standards and acts (including those engaged in or approved by a significant
portion of the power industry for similar facilities in the United States) that
at a particular time in the exercise of good judgment would have been expected
to comply with Governmental Requirements, and to promote safety, environmental
protection, economy and expedition.


 


“Prudent Wind Industry Practices” means standards and practices that
are widely accepted by the wind energy industry for wind projects of this size
and that are prudently applied and reasonably anticipated and intended to
maximize output and productivity of the Turbines, consistent with their
intended design lives.


 


I-7

















 


“PTC Benefits” means the tax credits that Purchaser may be eligible to
claim for the production of renewable energy by the Project in accordance with
Section 45 of the United States Internal Revenue Code, as in effect as of
the date of this Agreement


 


“Purchaser” includes the named Purchaser identified in the Preamble to
the Supply Agreement and its successors and permitted assigns.


 


“Purchaser Permits” mean all Permits required in connection with the
development, construction, ownership and operation of the Project, other than
the Supplier Permits.


 


“SCADA System” means a supervisory control and data acquisition system,
including a central computer and related software, whether supplied and
installed by Supplier or by a third party, as more particularly described in
the SCADA System Specifications.


 


“SCADA System Installation Manual” means the manual attached to the
Supply Agreement as Exhibit V.


 


“SCADA System Specifications” means those specifications set forth on Exhibit U
to the Supply Agreement, pertaining to the SCADA System.


 


“Services” shall mean the Commissioning Work.


 


“Site Agreements” means any agreement between Purchaser, Project
Manager, Supplier or Operator, and any third party, with respect to the
operation or maintenance of the Project.


 


“Subcontractors” means such subcontractors, consultants or suppliers
which in the Supplier’s reasonable judgment may be necessary to complete
Supplier’s duties and obligations under the Supply Agreement.


 


“Supplier” includes the named Supplier identified in the Preamble to
the Supply Agreement and its successors and permitted assigns.


 


“Supplier Permits” means the Supplier Permits listed on Exhibit R
to the Supply Agreement.


 


“Supply Agreement” means the Turbine Supply Agreement dated as of
December 31, 2007 by and between Supplier and Purchaser and any amendments
thereto.


 


“Supply Items” means, collectively, the Major Turbine Components and
Ancillary Parts and Equipment.


 


“Supply Obligations” means Supplier’s obligations under the Supply
Agreement to (i) supply Purchaser the Supply Items and (ii) provide
Purchaser certain services in connection with the Supply Items, including
(a) supplying, packing, shipping and Delivering all Supply Items to their
Designated Delivery Locations; (b) at Purchaser’s request, providing a
technical adviser to be present at the Project Site during Turbine
Installation; and (c) performing the Commissioning Work.


 


I-8

















 


*****


 


“Testing Engineer” means Garrad Hassan Germanischer Lloyd, the National
Renewable Energy Laboratory, or Global Energy Concepts, or such other
independent engineer as mutually agreed.


 


“Tower” means each 77.4 meter steel tubular tower component of a
Turbine having a hub height of approximately eighty meters (80 m) (measured
from the base of such tower to the center of the Turbine hub) upon which a
Turbine Nacelle shall be mounted, including all ladders, platforms, internal
lighting, safety equipment, and all parts and assemblies necessary for a
complete turbine tower, all as further described in the Turbine Specifications.


 


“Tower Foundation Requirements” means Supplier’s requirements for the
foundation upon which the Towers are to be erected (which shall specify
foundation loads, bolt configuration, cable configuration and grounding
requirements).


 


“Transferee Agreement and Acknowledgement” means the Agreement and
Acknowledgement executed by Owner and delivered to Supplier in the form
attached hereto as Exhibit K to this Agreement.


 


“Transmission Facilities” mean the underground and/or overhead
distribution, collection and transmission lines; underground and/or overhead
control, communications and radio relay systems and telecommunications
equipment; energy storage facilities; interconnection and/or switching
facilities, circuit breakers, transformers; cables, wires, fiber, conduit,
footings, foundations, towers, poles, crossarms, guy lines and anchors, and any
related or associated improvements, fixtures, facilities, appliances, machinery
and equipment.


 


“Turbine” has the meaning given in the Recitals to the Supply
Agreement.


 


“Turbine Blade” means a turbine blade component of a Turbine (each Turbine
shall have three (3) Turbine Blades).


 


“Turbine Component Storage Requirements” means Supplier’s standard
requirements for storage and maintenance of Turbine Components pending
installation.


 


“Turbine Controller” means the circuit breaker and controller equipment
for each Turbine as further described in the Turbine Specifications.


 


“Turbine Installation Manual” means Supplier’s detailed manual for the
Installation Work.


 


I-9

















 


“Turbine Nacelle” means the turbine nacelle component of a Turbine,
including gearbox, generators, blade pitch controls, brakes, hydraulic systems,
lightning protection system, and nacelle yaw controls, and associated control
and ancillary equipment.


 


“Turbine Specifications” means those specifications set forth in Exhibit S
to the Supply Agreement pertaining to the Turbines.


 


“Turbine Supply Documents” means, collectively, the Supply Agreement,
the Warranty Agreement, the OMS Agreement and all other agreements, documents
or other instrument executed and delivered by the Parties hereto in connection
with the supply, installation (if applicable) and maintenance of the Turbines.


 


“Warranted Power Curve Percentage” or “WPCP” has the meaning given in Exhibit B
to the Warranty Agreement.


 


“Warranties” means the Standard Warranty, the Availability Warranty,
the Power Curve Warranty, the Sound Warranty, and the IP Warranty given
hereunder.


 


“Warranty Agreement” means that certain warranty agreement by and
between Supplier and Purchaser of even date herewith, pursuant to which
Supplier makes certain covenants and warranties to Purchaser with respect to
the Major Turbine Components supplied pursuant to this Agreement.


 


“Warranty Period Year” means, for the Turbines, the period beginning on
the earlier of (a) the date of Project Completion, or (b) six (6) months
after the last Major Turbine Component is Delivered to Purchaser, and ending
exactly twelve (12) months thereafter, and each of the following four (4)
twelve (12) month periods thereafter, provided, however that the last of such
periods shall not extend beyond the end of the Warranty Period.


 


I-10






 










 


[2013 TSA]


 


CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED FOR THE REDACTED PORTIONS OF THIS AGREEMENT. THE REDACTIONS ARE
INDICATED WITH FIVE ASTERISKS (“*****”). 
A COMPLETE VERSION OF THIS AGREEMENT HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.


 


Execution Copy


 


TURBINE SUPPLY AGREEMENT


 


BY AND BETWEEN


 


UPC WIND ACQUISITION V, LLC


 


AND


 


CLIPPER TURBINE WORKS, INC.


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE
  1

  	
   

  	
  DEFINITIONS AND RULES OF INTERPRETATION

  	
   

  	
  1

  
	
  1.1

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
  1.2

  	
   

  	
  Rules of Interpretation

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  2

  	
   

  	
  SUPPLY AND OTHER OBLIGATIONS OF SUPPLIER

  	
   

  	
  2

  
	
  2.1

  	
   

  	
  Supply and Commissioning Obligations

  	
   

  	
  2

  
	
  2.2

  	
   

  	
  Permits; Governmental Requirements

  	
   

  	
  3

  
	
  2.3

  	
   

  	
  Purchaser’s Right to Inspect

  	
   

  	
  3

  
	
  2.4

  	
   

  	
  Subcontractors

  	
   

  	
  3

  
	
  2.5

  	
   

  	
  Safety

  	
   

  	
  4

  
	
  2.6

  	
   

  	
  Independent Contractor

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  3

  	
   

  	
  PURCHASE PRICE AND PAYMENT

  	
   

  	
  4

  
	
  3.1

  	
   

  	
  Purchase Price

  	
   

  	
  4

  
	
  3.2

  	
   

  	
  Taxes

  	
   

  	
  4

  
	
  3.3

  	
   

  	
  Progress Payments

  	
   

  	
  4

  
	
  3.4

  	
   

  	
  Punch List Retainage

  	
   

  	
  5

  
	
  3.5

  	
   

  	
  Purchaser’s Credit Support

  	
   

  	
  6

  
	
  3.6

  	
   

  	
  Warranty Agreement

  	
   

  	
  6

  
	
  3.7

  	
   

  	
  Operations and Maintenance Service Agreement

  	
   

  	
  6

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  4

  	
   

  	
  DUTIES AND OBLIGATIONS OF PURCHASER

  	
   

  	
  6

  
	
  4.1

  	
   

  	
  Purchaser’s Obligations

  	
   

  	
  6

  
	
  4.2

  	
   

  	
  Cooperation with Supplier; Purchaser’s
  Representative

  	
   

  	
  7

  
	
  4.3

  	
   

  	
  Permits; Governmental Requirements

  	
   

  	
  8

  
	
  4.4

  	
   

  	
  Safety

  	
   

  	
  8

  
	
  4.5

  	
   

  	
  Intellectual Property Rights: Licenses and
  Obligations

  	
   

  	
  8

  
	
  4.6

  	
   

  	
  Transfer

  	
   

  	
  10

  
	
  4.7

  	
   

  	
  Access to Information

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  5

  	
   

  	
  COMMENCEMENT, DELIVERY AND SHIPMENT

  	
   

  	
  10

  
	
  5.1

  	
   

  	
  Commencement

  	
   

  	
  10

  
	
  5.2

  	
   

  	
  Shipping Arrangements

  	
   

  	
  10

  
	
  5.3

  	
   

  	
  Delivery Schedule

  	
   

  	
  10

  
	
  5.4

  	
   

  	
  Designated Delivery Locations

  	
   

  	
  11

  
	
  5.5

  	
   

  	
  Delay Delivery Damages

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  6

  	
   

  	
  FINAL ASSEMBLY WORK, INSTALLATION WORK,
  COMMISSIONING WORK AND PROJECT COMPLETION

  	
   

  	
  12

  
	
  6.1

  	
   

  	
  Final Assembly Work and Turbine Installation

  	
   

  	
  12

  
	
  6.2

  	
   

  	
  Commissioning

  	
   

  	
  12

  
	
  6.3

  	
   

  	
  Project Completion

  	
   

  	
  13

  
	
  6.4

  	
   

  	
  Purchaser Delays

  	
   

  	
  13

  



 


i

















 


TABLE OF CONTENTS 

(continued)


 


	
  ARTICLE
  7

  	
   

  	
  FORCE MAJEURE EVENTS

  	
   

  	
  13

  
	
  7.1

  	
   

  	
  Excused Performance

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  8

  	
   

  	
  CHANGE ORDERS

  	
   

  	
  14

  
	
  8.1

  	
   

  	
  Change Order

  	
   

  	
  14

  
	
  8.2

  	
   

  	
  Change Order Process

  	
   

  	
  14

  
	
  8.3

  	
   

  	
  No Change

  	
   

  	
  14

  
	
  8.4

  	
   

  	
  Scope Changes Caused by a Force Majeure Event

  	
   

  	
  14

  
	
  8.5

  	
   

  	
  Scope Changes Caused by Events within the Control of
  Purchaser

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  9

  	
   

  	
  LIMITATION OF LIABILITY

  	
   

  	
  15

  
	
  9.1

  	
   

  	
  Supplier Not Responsible for Purchaser’s Work

  	
   

  	
  15

  
	
  9.2

  	
   

  	
  Overall Limitation of Liability

  	
   

  	
  15

  
	
  9.3

  	
   

  	
  Consequential Damages

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  10

  	
   

  	
  TITLE AND RISK OF LOSS; INSURANCE

  	
   

  	
  16

  
	
  10.1

  	
   

  	
  Title to Supply Items

  	
   

  	
  16

  
	
  10.2

  	
   

  	
  Risk of Loss

  	
   

  	
  16

  
	
  10 3

  	
   

  	
  Insurance

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  11

  	
   

  	
  REPRESENTATIONS AND WARRANTIES OF SUPPLIER

  	
   

  	
  20

  
	
  11.1

  	
   

  	
  Due Organization; Good Standing

  	
   

  	
  20

  
	
  11.2

  	
   

  	
  Due Authorization

  	
   

  	
  20

  
	
  11.3

  	
   

  	
  Execution and Delivery

  	
   

  	
  20

  
	
  11.4

  	
   

  	
  Governmental Approvals

  	
   

  	
  20

  
	
  11.5

  	
   

  	
  Supply Items; Services

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 12

  	
   

  	
  REPRESENTATIONS AND WARRANTIES OF PURCHASER

  	
   

  	
  20

  
	
  12.1

  	
   

  	
  Due Organization; Good Standing; Qualified To Do
  Business

  	
   

  	
  20

  
	
  12.2

  	
   

  	
  Due Authorization

  	
   

  	
  21

  
	
  12.3

  	
   

  	
  Execution and Delivery

  	
   

  	
  21

  
	
  12.4

  	
   

  	
  Governmental Approvals

  	
   

  	
  21

  
	
  12.5

  	
   

  	
  Project Site

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  13

  	
   

  	
  MUTUAL INDEMNITY

  	
   

  	
  21

  
	
  13.1

  	
   

  	
  Mutual Indemnity

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  14

  	
   

  	
  DEFAULT; CURE; REMEDIES

  	
   

  	
  21

  
	
  14.1

  	
   

  	
  Default by Supplier

  	
   

  	
  21

  
	
  14.2

  	
   

  	
  Purchaser’s Remedies

  	
   

  	
  22

  
	
  14.3

  	
   

  	
  Default by Purchaser

  	
   

  	
  22

  
	
  14.4

  	
   

  	
  Supplier’s Remedies

  	
   

  	
  23

  
	
  14.5

  	
   

  	
  Cancellation Due to a Force Majeure Event

  	
   

  	
  23

  
	
  14.6

  	
   

  	
  Termination *****

  	
   

  	
  23

  
	
  14.7

  	
   

  	
  Surviving Obligations

  	
   

  	
  24

  



 


ii

















 


TABLE OF CONTENTS 

(continued)


 


	
  ARTICLE
  15

  	
   

  	
  DISPUTE RESOLUTION

  	
   

  	
  24

  
	
  15.1

  	
   

  	
  Procedure

  	
   

  	
  24

  
	
  15.2

  	
   

  	
  Qualifications of Arbitrators; Expenses

  	
   

  	
  26

  
	
  15.3

  	
   

  	
  Performance During Dispute

  	
   

  	
  27

  
	
  15.4

  	
   

  	
  Consolidation

  	
   

  	
  27

  
	
  15.5

  	
   

  	
  Language

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE
  16

  	
   

  	
  GENERAL PROVISIONS

  	
   

  	
  27

  
	
  16.1

  	
   

  	
  Waiver

  	
   

  	
  27

  
	
  16.2

  	
   

  	
  Successors and Assigns

  	
   

  	
  27

  
	
  16.3

  	
   

  	
  Permitted Assignments

  	
   

  	
  27

  
	
  16.4

  	
   

  	
  Notices

  	
   

  	
  28

  
	
  16.5

  	
   

  	
  Governing Law

  	
   

  	
  29

  
	
  16.6

  	
   

  	
  Amendments

  	
   

  	
  29

  
	
  16.7

  	
   

  	
  Attachments Incorporated

  	
   

  	
  29

  
	
  16.8

  	
   

  	
  Entire Agreement

  	
   

  	
  29

  
	
  16.9

  	
   

  	
  Confidentiality

  	
   

  	
  29

  
	
  16.10

  	
   

  	
  Counterparts

  	
   

  	
  30

  
	
  16.11

  	
   

  	
  English Language Documents

  	
   

  	
  30

  
	
  16.12

  	
   

  	
  Severability

  	
   

  	
  30

  
	
  16.13

  	
   

  	
  Headings

  	
   

  	
  30

  
	
  16.14

  	
   

  	
  Agreement Revisions

  	
   

  	
  30

  



 


iii

















 


	
  Exhibits

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Appendix
  I

  	
   

  	
  Definitions

  
	
  Exhibit A

  	
   

  	
  Ancillary Parts and Equipment

  
	
  Exhibit B

  	
   

  	
  Payment Schedule

  
	
  Exhibit C

  	
   

  	
  Spare Parts

  
	
  Exhibit D

  	
   

  	
  Turbine Installation Manual

  
	
  Exhibit E

  	
   

  	
  Foundation Loads Document

  
	
  Exhibit F

  	
   

  	
  Turbine Component Storage Requirements

  
	
  Exhibit G

  	
   

  	
  Termination Schedule

  
	
  Exhibit H

  	
   

  	
  Supplier’s Major Turbine Component Suppliers

  
	
  Exhibit I

  	
   

  	
  Supplier Account

  
	
  Exhibit J

  	
   

  	
  Guaranty

  
	
  Exhibit K

  	
   

  	
  Transferee Agreement and Acknowledgment

  
	
  Exhibit L

  	
   

  	
  Delivery Schedule

  
	
  Exhibit M

  	
   

  	
  Commissioning Certificate

  
	
  Exhibit N

  	
   

  	
  Project Completion Certificate

  
	
  Exhibit O

  	
   

  	
  Commissioning and Start-Up Procedures

  
	
  Exhibit P

  	
   

  	
  Final Assembly Work

  
	
  Exhibit Q

  	
   

  	
  Project Site

  
	
  Exhibit R

  	
   

  	
  Supplier Permits

  
	
  Exhibit S

  	
   

  	
  Turbine Specifications

  
	
  Exhibit T

  	
   

  	
  Completion Schedule

  
	
  Exhibit U

  	
   

  	
  SCADA System Specifications

  
	
  Exhibit V

  	
   

  	
  SCADA System Installation Manual

  



 


i

















 


TURBINE SUPPLY AGREEMENT


 


THIS TURBINE
SUPPLY AGREEMENT (the “Agreement” or the “Supply Agreement”) is made and
entered into and effective as of December 31, 2007 by and between CLIPPER
TURBINE WORKS, INC., a Delaware corporation (“Supplier”), and UPC WIND
ACQUISITION V, LLC, a Delaware limited liability company with a place of business
c/o UPC Wind Management, LLC, 85 Wells Ave., Suite 305, Newton, MA 02459 (“Purchaser”).
Supplier and Purchaser are sometimes referred to, individually, as a “Party”
or, collectively, as the “Parties”.


 


RECITALS


 


WHEREAS, Purchaser
desires to purchase, and Supplier desires to sell sixty (60) Clipper Windpower
2.5 MW “C-96” series wind turbine generators (each a “Turbine” and
collectively, (he “Turbines”), each consisting of the Major Turbine Components
and Ancillary Parts and Equipment (as set forth in Exhibit A
hereto). Additionally, Purchaser, in connection with its purchase of the
Turbines, desires to purchase and Supplier desires to provide the Commissioning
Work (as defined in Appendix I hereto), all on the terms and subject to
the conditions set forth herein.


 


WHEREAS, Purchaser
shall incorporate the Turbines into a single 150 MW wind power project being
developed by Purchaser to be located in the continental United States (the “Project”).


 


NOW, THEREFORE,
for good and valuable consideration, the receipt and adequacy of which is
hereby acknowledged, Supplier and Purchaser, intending to be legally bound,
hereby agree as follows:


 


AGREEMENT


 


ARTICLE 1


 


DEFINITIONS AND RULES OF
INTERPRETATION


 


1.1           Definitions. For purposes of
the Turbine Supply Documents and all schedules, exhibits and attachments
thereto, and in addition to the definitions elsewhere in this Agreement and the
other Turbine Supply Documents, the terms listed in Appendix I hereto
shall have the respective meanings assigned to such terms in Appendix I
hereto, which is incorporated herein and made a part hereof.


 


1.2           Rules of Interpretation.
In this Agreement: (a) references to Sections and to Exhibits are, unless
otherwise indicated, to Sections of and Exhibits to this Agreement; (b) the
headings to Sections and Articles of this Agreement are for ease of reference
only and shall not in any way affect its construction or interpretation; (c) the
masculine gender shall include the feminine and neuter and the singular number
shall include the plural, and vice versa, and references to persons shall
include individuals, bodies corporate, unincorporated associations, companies
and partnerships; and


 


1

















 


(d) references to
Parties in this Agreement shall be deemed to include references to their
successors and permitted assigns.


 


ARTICLE 2


 


SUPPLY AND OTHER OBLIGATIONS OF
SUPPLIER


 


2.1           Supply and Commissioning
Obligations. Purchaser hereby agrees to purchase and, subject to the terms
and provisions hereof, Supplier agrees to supply and Deliver as provided in
Subsections (a) and (b) below, the Supply Items and related Services
for the Turbines. With respect to the Supply Items and related Services,
following Purchaser’s submittal to Supplier of the Down Payment, and subject to
the compliance by Purchaser with the terms hereof, Supplier agrees to do the
following respecting the Supply Items and Services:


 


(a)           supply, pack, and Deliver, in
accordance with wind industry practice and commercially reasonable shipping
carrier requirements and in an economic manner consistent with wind industry
practices, all Supply Items, the SCADA System and all related components and
parts (other than foundations, foundation bolts, pad mount transformers and
collection lines, communication lines and related equipment to be supplied by
Purchaser) necessary to install and commission wind turbine generators in the
quantity set forth above that are capable of performing to the Turbine
Specifications (the “Supply Obligations”);


 


(b)           perform the Commissioning Work, as
described in Section 6.2 below.


 


2.1.1        Failure to Timely Deliver Down
Payment. If Purchaser fails to deliver to Supplier the Down Payment on or
before the Down Payment Date, then Purchaser’s right to purchase and Supplier’s
obligation to sell and Deliver the Supply Items and related Services shall
terminate at the option of Supplier and be of no further force or effect,
provided that Supplier shall first give Purchaser five (5) days written
notice to afford Purchaser the opportunity to correct its performance.


 


2.1.2.       Spare Parts.


 


(a)           During the Warranty Period, Supplier
shall maintain an inventory of spare parts at such location and consisting of
such spare parts as Supplier, in its sole discretion, shall determine necessary
for the timely operation and maintenance of the Turbines during the Warranty
Period (the “Necessary Spare Parts Inventory”). The list of spare parts
proposed by Supplier is attached hereto as Exhibit C. It is the
intention of the parties that the Necessary Spare Parts Inventory be used and
maintained during the Warranty Period in order for Supplier to fulfill its
obligations under the OMS Agreement and the Warranty Agreement.


 


(b)           Purchaser may purchase such
additional spare parts, at Purchaser’s sole expense, and maintain such
additional spare parts on the Project Site, at Purchaser’s sole expense;
provided that such spare parts are available from Supplier without unreasonably
impacting Supplier’s production of turbines.


 


2

















 


(c)           Within six (6) months of the
date of final payment by Purchaser to Supplier of the Purchase Price, Supplier
shall place into escrow with an escrow agent to be agreed upon between the
parties, subject to an escrow agreement to be agreed between the parties, drawings
(the “Spare Parts Drawings”) necessary for Purchaser to make or have made any
spare parts for the Turbines whose manufacture are subject to intellectual
property rights of Supplier. Pursuant to the terms of the agreed upon escrow
agreement, Purchaser shall be provided access to the Spare Parts Drawings only
if and when Supplier is unable to provide necessary spare parts for the
Turbines to Purchaser due to a default under Section 14.1(i), (ii), (iii) or
(iv) under this Agreement.


 


2.1.3        SCADA System. Purchaser shall
purchase the SCADA System from Supplier (exclusive of any fiber optic lines or
other communication lines) for an amount equal to ***** Dollars ($*****) as may
be adjusted by CCI as further described in Exhibit B. The price of the
SCADA System is included in the Purchase Price.


 


2.1.4        [Intentionally Left Blank].


 


2.1.5        Other Items. Supplier has
provided Purchaser with: the Turbine Installation Manual, a copy of which is
set forth on Exhibit D; the Foundation Loads Document, a copy of
which is set forth on Exhibit E; and the Turbine Component Storage
Requirements, a copy of which is set forth on Exhibit F. No later
than ten (10) days prior to the anticipated Commissioning of the first
Turbine, Supplier shall provide to Purchaser the OMS Manual. Concurrently with
the execution of this Agreement, Supplier and Purchaser shall deliver to the
other Party the Warranty Agreement and the OMS Agreement, duly executed by each
Party. At Purchaser’s request and at Purchaser’s cost, within twelve (12)
months of Commissioning of the last Turbine, Supplier shall provide to
Purchaser a location specific site suitability certificate from Germanischer
Lloyd.


 


2.2           Permits; Governmental
Requirements. Supplier shall secure and pay for all Supplier Permits
required for the Delivery of the Supply Items to the Designated Delivery
Location. Purchaser shall cooperate with Supplier in obtaining the Supplier
Permits. Supplier shall have no obligation to obtain any Purchaser Permit;
provided Supplier shall cooperate with Purchaser in Purchaser’s efforts to
obtain and comply with Purchaser Permits. Supplier shall comply with all
Governmental Requirements applicable to the performance of its obligations
hereunder.


 


2.3           Purchaser’s Right to Inspect.
Supplier shall permit Purchaser, upon ten (10) days prior written notice
to Supplier, to inspect the Turbines and to visit Supplier’s Turbine
manufacturing and assembly facilities for such purpose, subject in all cases to
Supplier’s confidentiality requirements and reasonable safety precautions, and
so long as such inspection and presence does not unreasonably interfere with or
delay the completion or Delivery of the Turbines or Supplier’s performance of
its obligations hereunder.


 


2.4           Subcontractors. Supplier may
retain such Subcontractors as in Supplier’s reasonable judgment may be
necessary to complete Supplier’s duties and obligations under this Agreement.
Supplier shall be solely responsible to pay its Subcontractors and the use of
any Subcontractor shall not limit Supplier’s obligations hereunder. The list of
Supplier’s Major Turbine Component suppliers is set forth on Exhibit H.
Supplier agrees that it will not use any Major Turbine 


 


3

















 


Components not listed or
Exhibit H without Purchaser’s advance written consent, such consent not to be
unreasonably withheld, conditioned or delayed.


 


2.5           Safety. Until any Supply Item
has been Delivered, Supplier shall take reasonable steps to protect each Supply
Item against damage, destruction or theft, and shall ensure that all Supplier
Insurance covering the Turbines remains in full force and effect prior to
Delivery.


 


2.6           Independent Contractor. In
performing its duties and obligations under this Agreement, Supplier shall, at
all times, act in the capacity of an independent contractor, and shall not in
any respect be deemed (or act as) an agent of Purchaser for any purpose or
reason whatsoever. Supplier shall have no responsibility for any of Purchaser’s
Work hereunder.


 


ARTICLE 3


 


PURCHASE PRICE AND PAYMENT


 


3.1           Purchase Price. For the Supply
Items, SCADA System and Services, Purchaser shall pay to Supplier ***** Dollars
($*****), which amount shall be adjusted pursuant to the CCI as defined in Exhibit B
attached hereto (the “Purchase Price”). Purchaser shall pay to Supplier on the
date of this Agreement (the “Down Payment Date”) a non-refundable amount equal
to ***** Dollars ($*****) (the “Down Payment”). All payments to be made under
this Agreement by Purchaser to Supplier shall be made in immediately available
funds to the Supplier account set forth in Exhibit I. The Purchase
Price is subject to adjustment by Change Order as provided in this Agreement.


 


3.2           Taxes. Supplier shall be
responsible for (a) all federal and state income taxes payable by Supplier
in connection with its net income, (b) all taxes in connection with the
import of any Supply Item into the United States, and (c) any business
license or fees arising in connection with Supplier’s business in any State. Purchaser
shall be responsible for all sales and use tax and any other federal, state or
local taxes imposed on the sale or use of the Supply Items and any services
provided hereunder (collectively “Taxes”).


 


3.3           Progress Payments.


 


3.3.1        The remaining amount of the Purchase
Price shall be paid by the Purchaser to the Supplier pursuant to the Payment
Schedule set forth on Exhibit B attached hereto (the “Payment
Schedule”). Upon completion of each of the milestones for the Project set forth
on Exhibit B attached hereto, the corresponding portion of the
Purchase Price shall be due and payable to Supplier as set forth on Exhibit B
attached hereto(each, a “Progress Payment”).


 


(a)           Purchaser shall pay the Down Payment
and each Progress Payment to Supplier in United States Dollars and in
immediately available funds to the account of Supplier, identified on Exhibit I.
Should Purchaser fail to make any Progress Payment when due, in addition any
other remedy available to Supplier under this Agreement, or otherwise, (i) Supplier
may enforce the Guaranty as set forth in Section 3.5 pursuant to
its terms; (ii) such overdue amount shall bear interest until paid in full
at the Default Rate, and (iii) Supplier may, without prejudice to any
other rights or remedies it may have under this Agreement, stop its performance
hereunder until the overdue amount and interest thereon is paid in full.


 


4

















 


(b)           Provided that Supplier has duly
performed or is reasonably performing its obligations hereunder and
irrespective of any other term of this Agreement, and provided that any delay
in obtaining the Project Completion Certificate within six (6) months
after Delivery of the last Major Turbine Component by Supplier for the Project
is not caused solely by Supplier or any of Supplier’s Affiliates or
subcontractors, one hundred percent (100%) of the Purchase Price, subject to
the retention of the applicable Punch List Retainage, shall be paid by
Purchaser to Supplier no later than six months after Delivery of the last Major
Turbine Component by Supplier for the Project.


 


(c)           *****


 


3.4           Punch List Retainage. In
delivering the Project Completion Certificate as provided in Section 6.3
below hereunder, Supplier shall include an estimated cost to complete each item
of Punch List Work (200% of such estimated costs being the “Punch List
Retainage”). The Progress Payment corresponding to delivery of the Project
Completion Certificate shall be decreased by an amount, if any, which is equal
to the Punch List Retainage, and upon the completion of any item of Punch List
Work to the reasonable satisfaction of Purchaser, Purchaser shall immediately
pay Supplier the Punch List Retainage that was retained by Purchaser for such
item of Punch List Work.


 


5

















 


3.5           Purchaser’s Credit Support.
Purchaser shall, concurrently with the delivery by Purchaser of the Down
Payment, deliver to Supplier a guaranty from its parent company (the
“Guaranty”) in substantially the form attached hereto as Exhibit J.


 


3.6           Warranty Agreement. The
Parties acknowledge that, concurrent with the execution of this Agreement, the
Parties shall enter into the Warranty Agreement. The cost of the first two (2) years
of warranty coverage under the Warranty Agreement is included in the Purchase
Price.


 


3.7           Operations and Maintenance Service
Agreement. Concurrent with the execution of this Agreement, Affiliates of
the Purchaser and Supplier shall execute an OMS Agreement whereby Supplier, an
Affiliate of Supplier, or a contractor designated by Supplier and approved by
Purchaser (the “Contractor”) shall provide operation and maintenance service to
the Project. Pursuant to the terms of the OMS Agreement, the cost for the first
two (2) years of OMS Services (other than Additional OMS Services) is
included in the Purchase Price.


 


ARTICLE 4


 


DUTIES AND OBLIGATIONS OF PURCHASER


 


4.1           Purchaser’s Obligations.
Purchaser agrees to perform the following, all on the terms and subject to the
conditions of this Agreement:


 


4.1.1        Payment. Purchaser shall make the
Down Payment, all Progress Payments and any other payments due Supplier under
this Agreement when due and shall be responsible for and promptly pay all
Taxes.


 


4.1.2        Purchaser’s Work. Purchaser
shall, at its sole cost and expense, be solely responsible for all work
necessary for the development, construction, completion and operation of the
Project (other than the Delivery of Supply Items and the performance of the
Services by Supplier) and for the installation and operation of the Turbines,
which work (herein “Purchaser’s Work”) shall include the following:


 


(a)           Site Suitability and Access.
Purchaser shall ensure that the Project Site is suitable for installation of
the Turbines in accordance with the Turbine Specifications and Turbine
Installation Manual and shall ensure that Supplier has continuous unfettered
physical access to the Project Site during normal business hours during the
performance of its Commissioning Work;


 


(b)           Acceptance and Shipment of Supply
Items. Upon Supplier’s Delivery of any Supply Item to its respective
Designated Delivery Location, Purchaser shall, unless otherwise agreed by the
Parties, within five (5) days after notice from Supplier and at such date
and time set forth in Supplier’s notice, pick up the Supply Item at its
Designated Delivery Location, and ship, install or store such Supply Item at
the Project Site. Purchaser shall be responsible for any reasonable costs
incurred by Supplier due to Purchaser’s delay in promptly picking up and transporting
off site any Supply Item upon its Delivery within said five (5) day
period. Purchaser shall be solely responsible for shipment and insurance of
each Supply Item once picked up;


 


6














 


(c)           Storage. Purchaser shall
ensure that adequate staging, lay down and storage areas for the Supply Items
are available and maintained at the Project Site and shall store and maintain
the Supply Items pending installation in accordance with the Turbine Component
Storage Requirements set forth on Exhibit F;


 


(d)           Tower Foundations. Purchaser
shall investigate the Project Site and its soil conditions and shall design and
construct the Tower Foundations in accordance with Supplier’s Tower Foundation
Requirements;


 


(e)           Turbine and SCADA System
Installation. Purchaser shall perform the Turbine Installation Work and the
installation of the SCADA System, all in strict accordance with the Turbine
Specifications, the Turbine Installation Manual and the SCADA System Installation
Manual; and shall (i) notify Supplier of Purchaser’s proposed schedule for
all such work; (ii) coordinate such work with Supplier’s Commissioning
Work for the Turbines; and (iii) complete the Installation Work in such a
manner so that a team of two technicians can complete the Commissioning of each
Turbine within a period not to exceed three and a half (3 1⁄2) Business Days,
without interruption or delay on a continuous basis until all Turbines have
been Commissioned;


 


(f)            Construction of Project.
Purchaser shall (i) perform the Final Assembly Work which is set forth in Exhibit P
hereto, (ii) perform all civil works (including roads, grading,
maintenance facilities, meteorological towers and other items); (iii) perform
all electrical works (including collection lines, Electrical Infrastructure,
Transmission Facilities, Interconnection Facilities and other items); (iv) provide
and install a remote terminal unit and cabling to the Substation,
meteorological towers, and communications lines for the SCADA System to the
Substation; and (v) provide any other items required for the operation of
the Project; and


 


(g)           Commissioning Responsibilities.
Purchaser shall ensure that at all times during Commissioning Work, each
Turbine shall have a continuous supply of electricity from the grid, and that
Purchaser’s utility will accept electricity generated by such Turbine. During
Commissioning, Purchaser shall provide assistance, including equipment,
electricians and mechanics, as may be reasonably required by Supplier to
address any out of scope impacts on the completion of Commissioning. Purchaser
shall arrange for the provision of full grid power to each Turbine to ensure
completion of the Commissioning Work for each Turbine.


 


4.1.3    Other Items. On or
before the date that is thirty (30) days prior to the date of Delivery of the
first Major Turbine Component for the Project, Purchaser shall provide Supplier
with notification of the anticipated date that Purchaser will energize the
substation for the Project.


 


4.2       Cooperation with Supplier: Purchaser’s
Representative. Purchaser shall cooperate with Supplier and, if applicable,
shall cause its EPC Contractor and any other contractors engaged by Purchaser
with respect to the Project (herein, “Purchaser’s Contractors”), to cooperate
with Supplier, all in connection with Supplier’s performance of its obligations
hereunder. Purchaser shall promptly provide Supplier with a schedule of the
names and contact information for all of Purchaser’s


 


7

















 


Contractors and shall
update such schedule periodically. Purchaser designates Scott Rowland as its
representative (“Purchaser’s Representative”) in dealing with Supplier with
respect to this Agreement.


 


4.3       Permits: Governmental Requirements.
Purchaser shall secure and pay for all Purchaser Permits, including any permits
required for the delivery of Supply Items from the Designated Delivery Location
to the Project Site. Supplier shall cooperate with Purchaser in obtaining
Purchaser’s Permits. Purchaser shall have no obligation to obtain any Supplier
Permit; provided that, Purchaser shall cooperate with Supplier in Supplier’s
efforts to obtain Supplier Permits. Purchaser shall comply with all
Governmental Requirements applicable to the performance of Purchaser’s Work.


 


4.4       Safety. Upon Delivery of any
Supply Item to its Designated Delivery Location, Purchaser shall take
reasonable steps, and shall ensure that the EPC Contractor and the Purchaser’s
Contractors take reasonable steps, to protect any such Supply Item against
damage or theft.


 


4.5       Intellectual Property Rights: Licenses
and Obligations.


 


4.5.1        Patents. Supplier hereby grants
to Purchaser under Supplier’s patent rights, only the non-exclusive right to
use the Supply Items provided to Purchaser under this Agreement. Supplier
expressly reserves all other patent rights, including, without limitation, the
right to make, use, sell, offer for sale and import other products identical to
or similar to the Supply Items. Other than the rights granted herein with
respect to the Supply Items, Supplier expressly reserves all other patent
rights, and Purchaser shall not have the right under Supplier’s patent rights
to make, use, sell, offer for sale, or import any products or methods that
infringe Supplier’s patents or to sublicense any of the foregoing rights.


 


4.5.2        Trade Secrets. Purchaser
acknowledges that the technical, operation and maintenance, and other
information it receives in connection with the Supply Items (including, without
limitation, any and all firmware, software, Turbine Specifications, SCADA
System Specifications, installation and operation and maintenance procedures,
know-how and similar items) constitute trade secret information that is
proprietary to Supplier. Supplier hereby grants to Purchaser under Supplier’s
trade secret rights, the non-exclusive right to use such trade secrets only in
the installation and operation and maintenance of the Supply Items. Supplier
further grants to Purchaser under Supplier’s trade secret rights, the
non-exclusive right to disclose such trade secrets to a third party only as
necessary for the financing, installation and operation and maintenance of the
Supply Items provided such third party executes a written agreement obligating
it to maintain the confidentiality of the trade secret information and to
return all copies of such trade secret information received and prohibiting
reverse engineering, disassembly, and decompilation of any of the trade secret
information. Other than the rights granted herein with respect to the Supply
Items, Supplier expressly reserves all other trade secret rights. Purchaser
agrees to maintain all such trade secret information in strict confidence and
shall not disclose such trade secret information to any third party except in
accordance with this Section 4.5.2. The obligations of
confidentiality herein shall survive termination or expiration of this
Agreement.


 


4.5.3        Copyrights. Purchaser
acknowledges that the technical, operation and maintenance, and other information
it receives in connection with the Supply Items (including,


 


8

















 


without limitation, any
and all firmware, software, Turbine Specifications, SCADA System
Specifications, installation and operation and maintenance procedures,
descriptions of know-how and similar written items) constitute copyrightable
material. Supplier hereby grants to Purchaser under Supplier’s copyrights, the
non-exclusive right to copy and use such copyrighted materials only in the installation
and operation and maintenance of the Supply Items. Supplier further grants to
Purchaser under Supplier’s copyrights, the non-exclusive right to copy the
copyrightable materials and distribute such to a third party only as necessary
for the installation and operation and maintenance of the Supply Items,
provided such third party executes a written agreement obligating it to return
all copies of such copyrightable materials received, prohibiting any further
copying or distribution of such copyrightable materials, and prohibiting
reverse engineering, disassembly and decompilation of any of the copyrightable
materials. Other than the rights granted herein with respect to the Supply
Items, Supplier expressly reserves all other copyright rights. Purchaser shall
not have the right to sublicense any of the Supplier’s copyright rights or the
right to create derivative works of any of the copyrightable materials.
Purchaser shall not reverse engineer, disassemble or decompile any of the
copyrightable materials.


 


4.5.4        Trademarks and Service Marks.
Purchaser shall not have any rights in any trademarks or service marks, whether
registered or not, that are owned or controlled by Supplier. Purchaser shall
not utilize any trademark or service mark that is substantially similar to any
trademarks or service marks owned or controlled by Supplier. Purchaser may
reference only those trademarks or service marks owned by Supplier in its
written materials; provided that, such reference clearly denotes that such is a
trademark or service mark and is owned by Supplier.


 


4.5.5        Transfer of Title in Supply Items.
Should Purchaser transfer title in any of the Supply Items to a third party,
the licenses provided in this Section 4.5 shall run with such
Supply Items, provided such third party executes a Transferee Agreement and
Acknowledgment, in the form attached hereto as Exhibit K,
acknowledging Supplier’s ownership in the respective Intellectual Property
Rights and obligating itself to all of the same prohibitions and restrictions with
respect to Supplier’s Intellectual Property Rights described in this Section 4.5.
Purchaser acknowledges that the Supply Items may be subject to the export
control laws and regulations of the United States of America and agrees to
comply with all such laws and regulations regarding any export of any of the
Supply Items.


 


4.5.6        Ownership and Injunctive Relief.
All Intellectual Property Rights owned or controlled by Supplier shall remain
the exclusive property of Supplier and nothing herein shall be construed as a
sale, lease, loan, or transfer of any of such Intellectual Property Rights.
Purchaser shall derive no rights, title or interest therein except as expressly
set forth in this Agreement. Any technical information concerning the Supply
Items that Purchaser acquires or develops in connection with the ownership or
operation of the Turbines shall be the property of Supplier. Further, Purchaser
acknowledges that a breach of the confidentiality provisions in this Agreement
may cause Supplier irreparable harm and damage that may not be recoverable at
law and that Purchaser shall be entitled to obtain injunctive relief in
addition to any other rights or remedies Purchaser may have.


 


4.5.7        Government Rights. Any and all
computer software and related documentation provided as part of the Supply
Items are “commercial items” as that term is defined at 48 C.F.R. 2.01 (October 1995)
comprising “commercial computer software” and


 


9

















 


“commercial computer
software documentation” as used in 48 C.F.R. 12.212 (September 1995) and
other applicable acquisition regulations and are provided to the U.S.
Government only as a commercial item and subject to the terms and conditions
and all restrictions set forth in this Agreement as applicable to such computer
software and related documentation. Consistent with 48 C.F.R. 12.212 and 48
C.F.R. 227.7202 (June 1995), all U.S. Government users and licensees
acquire the software and its related documentation with only those rights
applicable to such software and related documentation as set forth in this Section 4.5.


 


4.6       Transfer. Purchaser covenants and
agrees that it will not sell, lease or otherwise transfer the Turbines or any
part thereof unless Purchaser first obtains and delivers to Supplier a
Transferee Agreement and Acknowledgment, executed by the proposed transferee.
Notwithstanding anything else contained herein, Purchaser may assign in whole
or in part its rights under this Agreement to an Affiliate upon notice to
Supplier.


 


4.7       Access to Information. From the
date of this Agreement through the end of the fifteenth (15th) year after
Project Completion, Purchaser shall provide to Supplier prompt access to all
technical, operational and maintenance and other information it receives or
collects in connection with its operating the Turbines. The collection of all
such data shall be at the reasonable expense of Supplier. All information
provided by Purchaser hereunder shall be subject to the provisions of Section 16.9.


 


ARTICLE 5


 


COMMENCEMENT, DELIVERY AND SHIPMENT


 


5.1       Commencement. Subject to Section 2.1.1,
Supplier shall commence performance of its obligations under this Agreement on
the Down Payment Date. In addition to Supplier’s other rights and remedies
hereunder, if any payment due under this Agreement is not timely made by
Purchaser, the delinquent payment amount shall accrue interest at the Default
Rate.


 


5.2       Shipping Arrangements. All Supply
Items shall be delivered Ex Works at the Designated Delivery Locations. For
purposes of this Agreement, each individual Supply Item and the SCADA System
shall be deemed “Delivered” and Supplier shall have satisfied its delivery
arrangements with respect thereto, when Supplier makes available such Supply
Item and SCADA System at its Designated Delivery Location for pick up by
Purchaser, provided however, that Purchaser may not take custody and control of
the said Supply Item until the applicable Progress Payment has been made by
Purchaser and received by Supplier. Purchaser shall be responsible for all
loading and shipment of the Supply Items and SCADA System from their respective
Designated Delivery Locations to the Project Site and shall pay for all costs
and expenses incurred by Purchaser related thereto, including the costs of
maintaining insurance on such Supply Item and SCADA System during shipment of
such Supply Item and SCADA System from its respective Designated Delivery
Location to the Project Site.


 


5.3       Delivery Schedule. The Supply
Items shall be Delivered to their Designated Delivery Locations in accordance
with the Delivery Schedule attached as Exhibit L (the “Delivery
Schedule”); provided however, that Supplier shall use commercially reasonable
efforts to work with Purchaser to revise the Delivery Schedule as necessary
considering Supplier’s manufacturing


 


10

















 


schedules and Purchaser’s
Project requirements. Delivery dates in the Delivery Schedule will be deemed
met so long as the Supply Items are delivered to the Designated Delivery
Locations on or before the date for such delivery set forth in the Delivery
Schedule; provided that, Supplier shall have the right to Deliver the Supply
Items up to one (1) month earlier than provided for in the Delivery
Schedule. The SCADA System shall be delivered at a Designated Delivery Location
mutually agreed by the Parties following the installation of the first Turbine
at the Project Site by Purchaser.


 


5.4       Designated Delivery Locations.
Unless otherwise agreed in writing by the Parties, Supplier shall Deliver the
Supply Items as follows: (i) Turbine Nacelle, Turbine Controller, Turbine
hub and Ancillary Parts and Equipment at Supplier’s factory near Cedar Rapids,
Iowa, (ii) the Turbine Blades at such location or warehouse facility as
Supplier may direct near Houston, Texas, or at another mutually agreed upon
location, provided any costs associated with such other mutually agreed
location be borne by Purchaser, and (iii) the Towers at the manufacturing
facility located in Chattanooga, Tennessee, or at such other domestic location
as Supplier may specify at any point prior to three (3) months from the
Delivery date set forth in the Delivery Schedule. Each of the foregoing
locations is referred to herein as a “Designated Delivery Location.”


 


5.5       Delay Delivery Damages. The
Parties acknowledge that Purchaser will suffer damages that will be difficult
to ascertain if Purchaser fails to Deliver any Major Turbine Component within thirty
(30) days of the applicable date of Delivery set forth in the Delivery Schedule.
Consequently, the Parties agree that Supplier will pay Purchaser, if any Major
Turbine Component is Delivered thirty (30) days or more late and such delay was
not due to any Force Majeure Event or breach by Purchaser of any of its
obligations under this Agreement, the following amount as liquidated damages:
For each full day after the first thirty (30) days following the date that the
Delivery of such Major Turbine Component is delayed beyond the date specified
in the Delivery Schedule, an amount equal to $***** per Turbine per day for the
first fifteen (15) days after delay payments become payable, an amount equal to
$***** per day for the next fifteen (15) days, and an amount equal to $*****
per day thereafter (the “Delay Delivery Damages”); provided that, in no event
shall the aggregate Delay Delivery Damages payable hereunder exceed *****
percent (*****%) of the pro-rata portion of the Purchase Price applicable to
the Turbine for which such delayed Major Turbine Component is a component. It
is understood and acknowledged by the Parties that if more than one Major
Turbine Component applicable to a Turbine is delivered late, the liquidated
damages applicable to the Turbine will not exceed $***** per day (for the first
15 days after delay payments become payable), $***** per day (for the next 15
days of delay payments), and $***** per day (for delay payments thereafter), as
applicable. The Parties acknowledge and agree that the Delay Delivery Damages
set forth above are a reasonable estimate of the damages Purchaser will suffer
because of late Delivery of any Major Turbine Component and that, therefore,
the Delay Delivery Damages set forth herein shall be Purchaser’s sole and
exclusive remedy with respect to such Delivery delays.


 


11

















 


ARTICLE 6


 


FINAL ASSEMBLY WORK, INSTALLATION
WORK, 

COMMISSIONING WORK AND PROJECT COMPLETION


 


6.1       Final Assembly Work and Turbine
Installation. Purchaser shall complete the Final Assembly Work with respect
to all Turbines in conformance with the procedures and requirements set forth
in Exhibit P, and shall complete the Installation Work with respect
to all Turbines in accordance with the Installation Procedures and, subject to Section 5.3
above, within the period of time set forth on the Completion Schedule.


 


6.2       Commissioning. Commissioning of
the Turbines shall be conducted as follows:


 


6.2.1        Advance Completion Notice. No
less than thirty (30) days prior to the date Purchaser expects Supplier to
commence the Commissioning Work, Purchaser shall provide Supplier with written
notice (the “Advance Completion Notice”) of Purchaser’s anticipated completion
date of the Installation Work and the date on which Supplier shall commence the
Commissioning Work (which date shall be no later than the date that Supplier is
obligated to commence the Commissioning Work as set forth in the Completion
Schedule). Purchaser shall use commercially reasonable efforts to schedule
Turbine Installation for all Turbines in the Project so that Supplier can
complete the Commissioning of each Turbine without interruption or delay on a
continuous basis until all the Turbines have been Commissioned.


 


6.2.2        Turbine Installation Inspection.
Following completion of the Installation Work with respect to any Turbine,
Purchaser shall deliver a written notice of completion to Supplier (an “Installation
Completion Notice”) and Supplier shall examine each Turbine in accordance with
the Installation Procedures and the Turbine Installation Manual. If the Turbine
fails to conform to the standards contained in the installation inspection
procedures set forth in the Turbine Installation Manual, then it shall be
deemed not properly installed, and Supplier shall promptly so notify Purchaser.
Purchaser shall then promptly take all required action to complete the
Installation Work for all Turbine(s) failing the installation inspection
procedures.


 


6.2.3        Commissioning Work. Supplier
shall perform the Commissioning Work for the Turbines in accordance with the
Commissioning and Start-Up Procedures and the Completion Schedule, subject to
any adjustment in the completion of the Commissioning Work, pursuant to Section 5.3
hereof, due to Supplier’s early Delivery of the Supply Items (provided,
however, that Supplier’s obligation to Complete the Commissioning Work by such
time set forth on the Completion Schedule shall be extended to the extent of
Purchaser’s delay in completing the Installation Work). Upon completion of the
Commissioning of each Turbine, Supplier shall issue to Purchaser a
commissioning certificate for such Turbine in the form attached hereto as Exhibit M
(each a “Commissioning Certificate”). Within five (5) days after receipt
of a Commissioning Certificate, Purchaser shall either approve such
Commissioning Certificate or deliver to Supplier written notice of any work
remaining to be completed by Supplier (the “Punch List Work”). If Purchaser
fails to deliver such notice within such five (5) day period, the
Commissioning Certificate will be deemed approved by Purchaser.


 


12

















 


6.3       Project Completion. Within five (5) days
after the delivery by Supplier to Purchaser of a Commissioning Certificate for
the Project’s final Turbine, Supplier shall also deliver to Purchaser a
completion certificate for all Turbines in the Project (the “Project Completion
Certificate”), in the form attached hereto as Exhibit N, together
with a list of any remaining Punch List Work on any Turbine, a schedule for
completing the Punch List Work and an estimate of the cost of each item of
Punch List Work. Supplier shall thereafter promptly complete all Punch List
Work.


 


6.4       Purchaser Delays. In the event
that any of the actions of Purchaser, the EPC Contractor or any of Purchaser’s
Contractors cause a delay in the performance by Supplier of the Commissioning
Work, Purchaser shall pay Supplier its actual documented costs directly
attributable to such delay, including wages, lodging and meals.


 


ARTICLE 7


 


FORCE MAJEURE EVENTS


 


7.1       Excused Performance. If either Party
is rendered wholly or partially unable to perform its obligations (other than
payment obligations) under this Agreement due to the occurrence of a Force
Majeure Event, such Party will be excused from the affected performance
obligation (other than payment obligations), provided that:


 


(a)           the affected Party gives the other
Party notice describing the particulars of the occurrence, including an
estimate of its expected duration and probable impact on the affected Party’s
obligations hereunder, such notice shall be given promptly after becoming aware
of the occurrence of the Force Majeure Event, and, in no event more than seven (7) days
after the affected Party becomes aware or should reasonably have been aware of
such occurrence;


 


(b)           the affected Party shall continually
exercise all commercially reasonable efforts to mitigate the effect of such
Force Majeure Event, remedy its inability to perform, and limit damages to the
other Party and shall promptly resume its performance when the Force Majeure
Event no longer impacts its ability to perform, and shall give the other Party
prompt notice of its intent to resume such performance;


 


(c)           the suspension of a Party’s
performance affected by the Force Majeure Event shall be of no greater scope
and of no longer duration than is reasonably required by the Force Majeure
Event;


 


(d)           no liability of either Party which
arose before the occurrence of the Force Majeure Event shall be excused as a
result of the occurrence thereof; and


 


(e)           no Force Majeure Event shall relieve
any Party from performing those of its obligations that are not materially
affected by the Force Majeure Event.


 


13

















 


ARTICLE 8


 


CHANGE ORDERS


 


8.1       Change Order. The term “Change
Order” as used herein shall mean a written instrument signed by Purchaser and
Supplier, stating their mutual agreement upon any of the following: (i) a
change in the fabrication or features of the Turbines (such as adding Federal
Aviation Administration lighting or a cold weather package); (ii) a change
in the Delivery Schedule or Completion Schedule; (iii) a change in the
Commissioning Work; (iv) a change in the number of or location of Project
sites; or (v) an adjustment in the Purchase Price (collectively “Scope
Changes”).


 


8.2       Change Order Process. Purchaser
may request Scope Changes within the general scope of this Agreement consisting
of additions, deletions, or other revisions. If Purchaser so desires to request
Scope Changes, it shall submit a change request to Supplier in writing. Within
ten (10) Business Days after its receipt of any such request, Supplier
shall submit a detailed proposal to Purchaser stating (a) the increase or
decrease, if any, in the Purchase Price which would result from such change,
and (b) the effect, if any, upon the Delivery Schedule or Completion
Schedule by reason of such proposed change. Purchaser shall have five (5) days
from receipt of Supplier’s detailed proposal to accept or reject in writing
Supplier’s proposal in relation to the requested change. If Purchaser agrees
with Supplier’s proposal, Purchaser and Supplier shall execute a Change Order
reflecting the requested Scope Changes and proposed adjustments, if any, in the
Purchase Price and the Delivery Schedule or Completion Schedule. In the event
Purchaser disagrees with Supplier’s proposal, Purchaser shall promptly so
notify Supplier, following which the Parties shall negotiate in good faith a
solution which is satisfactory to both Purchaser and Supplier. Should Purchaser
fail to respond to Supplier in writing within the foregoing five (5) day
period, Purchaser shall be deemed to have withdrawn its requested change.


 


8.3       No Change. Notwithstanding
anything to the contrary contained in this Agreement, Supplier shall not be
obligated to proceed with any Scope Changes requested by Purchaser unless and
until a Change Order is executed by the Parties in relation to such change.
Further, Supplier shall not be required to implement a requested Scope Change
by Purchaser if the implementation of such change would, in Supplier’s
reasonable opinion, likely impair Supplier’s ability to achieve any of the
performance guarantees, warranties or covenants set forth in this Agreement,
the OMS Agreement, and/or the Warranty Agreement.


 


8.4       Scope Changes Caused by a Force
Majeure Event. If a Force Majeure Event occurs that materially adversely
affects Supplier’s performance of all or a portion of the sale and Delivery
obligations hereunder or if such a Force Majeure Event causes any of the
Commissioning Work to be temporarily or permanently prevented, Supplier shall
be entitled to a Change Order reflecting such impact of such Force Majeure
Event, including an extension in Supplier’s time for performance for such delay
to the extent Supplier’s performance is actually delayed. In the case of a
Force Majeure Event, Supplier must notify Purchaser of Supplier’s intent to
request a Change Order (the “Notice of Intention”) within thirty (30) Business
Days of the Force Majeure Event. Supplier shall submit to Purchaser a draft
Change Order outlining, with reasonable specificity, the requested Scope
Changes within ten (10) Business Days after the Notice of Intention is
delivered to Purchaser.


 


14

















 


8.5       Scope Changes Caused by Events within
the Control of Purchaser. If Purchaser, EPC Contractor or any of Purchaser’s
Contractors causes an event that materially adversely affects Supplier’s
performance of all or a portion of the sale and Delivery obligations hereunder
or if such event causes the Commissioning Work to be temporarily or permanently
prevented, Supplier shall be entitled to a Change Order reflecting such impact
of such event, including (i) an extension in Supplier’s time for
performance for such delay to the extent Supplier’s performance is actually
delayed, and (ii) an increase in the Purchase Price with respect to such
additional cost to the extent such delay is caused solely by Purchaser, EPC
Contractor or any of Purchaser’s Contractors. In the case of such a Purchaser
caused event, Supplier must notify Purchaser of Supplier’s intent to request a
Change Order (the “Notice of Intention”) within thirty (30) Business Days of
the Purchaser caused event. Supplier shall submit to Purchaser a draft Change
Order outlining, with reasonable specificity, the requested Scope Changes
within ten (10) Business Days after the Notice of Intention is delivered
to Purchaser.


 


ARTICLE 9


 


LIMITATION OF LIABILITY


 


9.1       Supplier Not Responsible for Purchaser’s
Work. Notwithstanding anything to the contrary set forth herein, Supplier
shall not have any responsibility for (a) Project Site selection,
permitting or Turbine siting within the Project Site; (b) the design,
supply or construction of Tower foundations; (c) the assembly, erection
and installation of the Turbines or the SCADA System; (d) the design,
assembly, erection and installation of any other element of the Project, (e) obtaining
rights required by the Project to sell or transmit its electrical output, or (f) any
other element of Purchaser’s Work, all of which are expressly the
responsibility of Purchaser.


 


9.2       Overall Limitation of Liability.
Notwithstanding anything to the contrary contained in this Agreement, in no
event shall Supplier, its parent company, Affiliates and agents be liable,
alone or in the aggregate, to Purchaser for any damages, claims, demands,
suits, causes of action, losses, costs, expenses and/or liabilities related in
any manner to this Agreement, the Warranty Agreement and the OMS Agreement in
excess of an amount equal to ***** percent (*****%) of the Purchase Price,
regardless of whether such liability arises out of breach of contract,
guarantee or warranty, tort, product liability, indemnity, contribution, strict
liability or any other legal theory; provided, however, the preceding
limitation of liability shall not apply to, and no credit shall be issued
against such liability for, (a) Supplier’s indemnity obligations set forth
in Section 13.1 solely as they relate to claims by third Parties
for bodily injury or property damage, or (b) the fraud or willful
misconduct of Supplier.


 


9.3       Consequential Damages.
Notwithstanding anything to the contrary contained in this Agreement and except
as set forth in the last sentence of this Section, Purchaser and Supplier waive
all claims against each other (and against each other’s parent company,
Affiliates, contractors, subcontractors, consultants, vendors, suppliers and
agents) for any consequential, incidental, indirect, special, exemplary or
punitive damages (including, but not limited to, loss of actual or anticipated
profits, revenues or product; loss by reason of shutdown or non-operation;
increased expense of operation, borrowing or financing; loss of use or
productivity; or increased cost of capital), and regardless of whether any such
claim arises out of breach of contract or warranty, tort, product liability,
indemnity, contribution, strict liability or any other legal theory. Any


 


15

















 


consequential,
incidental, indirect, special, exemplary or punitive damages incurred by
Supplier or Purchaser in relation to a third Party shall, for all purposes of
this Agreement, be deemed consequential, incidental, indirect, special,
exemplary or punitive damages in relation to any claim brought by Supplier or
Purchaser against the other Party to this Agreement. Any liquidated damages
payable by Supplier under this Agreement shall not be deemed consequential,
incidental, indirect, or special damages for purposes of this Agreement.


 


ARTICLE 10


 


TITLE AND RISK OF LOSS; INSURANCE


 


10.1     Title to Supply Items. Title to any
Supply Item shall transfer to the Purchaser upon (i) the Delivery of such
Supply Item to its Designated Delivery Location and (ii) Purchaser’s
payment of and Supplier’s receipt of, the applicable Progress Payment.


 


10.2     Risk of Loss. Supplier shall bear
the risk of loss and damage with respect to any Supply Item (including each
individual Major Turbine Component) until Delivery of such Supply Item to its
Designated Delivery Location. In performing the Commissioning Work, Supplier
shall be deemed a contractor of Purchaser performing the Services on Supply
Items then owned by Purchaser. Upon the Delivery of any Supply Item to its
Designated Delivery Location, care, custody and control of, and risk of loss or
damage to, such Supply Item shall thereupon transfer to the Purchaser.


 


10.3     Insurance. Supplier and Purchaser
shall maintain the following insurance while this Agreement is in effect:


 


10.3.1  Supplier Insurance.


 


Supplier shall carry and
maintain or cause to be carried and maintained, at all times during the Term of
this Agreement, insurance coverage with limits as set forth in this Section (the
“Supplier Insurance”).


 


Marine
Cargo Insurance


 


All property and
interests of every kind and description (including materials, equipment,
machinery and spares) intended for the Project or subsequent operations while
in transit by land, air and/or sea. All Risks of physical loss or damage from a
cause not excluded but including war, strikes, riots and civil commotions and
terrorism while in transit, on a continuous open cover basis. Increased cost of
working - the additional expenditure necessarily and reasonably incurred for
the purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Property


 


At all times the Supplier’s
factory premises, plant, machinery, raw materials and finished stocks all
related to and comprising the Project under a property insurance in an amount
equal to the full replacement value of the above named items for “all risks” of
physical loss or damage including, but not limited to, coverage for earth
movement,


 


16

















 


flood, windstorm,
earthquake, sabotage, terrorism, riots, civil commotion, testing, boiler and
machinery, transit and off-site storage. The policy may contain separate sub
limits and deductibles subject to insurance company underwriting guidelines.
Deductibles under the policy shall not exceed $100,000 per occurrence, except for
deductibles for natural catastrophe peril, which shall not exceed five percent
(5%) of the insured loss


 


Increased cost of working
- the additional expenditure necessarily and reasonably incurred for the
purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Workers
Compensation


 


Coverage shall comply
with any statutory obligation imposed by Workers Compensation, Occupational
Disease Laws, or similar laws, including where applicable, the United States
Longshoremen’s and Harbor Workers’ Act, the Federal Employers’ Liability Act
and the Jones Act. Employers’ Liability insurance shall have limits of not less
than $1,000,000 per accident, $1,000,000 disease-policy limit and $1,000,000
disease-each employee.


 


Commercial
General Liability


 


Insurance providing
coverage for bodily injury, property damage and personal/advertising injury
with a combined single limit of not less than $1,000,000 per occurrence and
$2,000,000 aggregate. The policy shall include contractual liability and any
testing operations coverage.


 


a.        Automobile Liability -
Insurance for owned, non-owned and hired automobiles with a limit of not less
than $1,000,000 per occurrence.


 


b.        Excess liability -
Insurance with a minimum limit of $10,000,000 per occurrence and annual
aggregate.


 


c.        Evidence and Scope of
Insurance - Supplier shall provide Purchaser with a copy of
insurance original certificates evidencing the insurance coverages required and
shall provide replacement certificates of insurance within five (5) days
of any renewal of the required insurance.


 


All such insurance
policies shall:


 


(i)      name Purchaser for their respective rights
and interests in respect of the Project as additional insured (except in the
case of worker’s compensation insurance);


 


(ii)     provide Purchaser with 30 days’ prior
written notice of non-renewal, cancellation of, or significant modification to,
any of such policies (except that such notice period will be 10 days in case of
non-payment of premiums); and


 


(iii)    the insurance certificates provided to
Purchaser shall indicate that the insurance policies have been endorsed as
noted above. All


 


17

















 


policies shall be written
by one or more insurance companies authorized to do business in USA and be
rated BBB+ or higher by A.M. Best.


 


Term and
Modification of Insurance


 


If the designated
coverage, or relatively comparable coverage, are unavailable on reasonable
commercial terms, Supplier will provide Purchaser detailed information as to
the maximum amount of available coverage that it is able to purchase and will
be required to obtain Purchaser’s consent as to the adequacy of said coverage
under the circumstances at the time, which consent shall not be unreasonably
withheld or delayed.


 


10.3.2  Purchaser Insurance.


 


Purchaser shall carry and
maintain or cause to be carried and maintained, at all times during the Term of
this Agreement, insurance coverage with limits as set forth in this Section.


 


Builder’s
All Risk Insurance


 


At all times during
construction, the Purchaser’s Project will be under a builder’s all risk
insurance in an amount equal to the full replacement value of the Project for “all
risks” of physical loss or damage including, but not limited to, coverage for
earth movement, flood, windstorm, earthquake, sabotage, terrorism, riots, civil
commotion, testing, boiler and machinery, transit and off-site storage. The
policy may contain separate sub limits and deductibles subject to insurance
company underwriting guidelines. Deductibles under the policy shall not exceed
$100,000 per occurrence, except for deductibles for natural catastrophe peril,
which shall not exceed five percent (5%) of the insured loss


 


Increased cost of working
- the additional expenditure necessarily and reasonably incurred for the
purpose of avoiding or reducing delay which, without such expenditure would
have taken place.


 


Workers
Compensation


 


Coverage shall comply
with any statutory obligation imposed by Workers Compensation, Occupational
Disease Laws, or similar laws, including where applicable, the United States
Longshoremen’s and Harbor Workers’ Act, the Federal Employers’ Liability Act
and the Jones Act. Employers’ Liability insurance shall have limits of not less
than $1,000,000 per accident, $1,000,000 disease-policy limit and $1,000,000
disease-each employee.


 


18














 


Commercial
General Liability


 


Insurance providing
coverage for bodily injury, property damage and personal/advertising injury
with a combined single limit of not less than $1,000,000 per occurrence and
$2,000,000 aggregate. The policy shall include contractual liability and any
testing operations coverage.


 


a.         Automobile
Liability - Insurance for owned, non-owned and hired automobiles
with a limit of not less than $1,000,000 per occurrence.


 


b.         Excess
liability - Insurance with a minimum limit of $10,000,000 per
occurrence and annual aggregate.


 


c.         Evidence
and Scope of Insurance


 


Purchaser shall
provide Supplier with a copy of insurance original certificates evidencing the
insurance coverages required and shall provide replacement certificates of
insurance within five (5) days of any renewal of the required insurance.


 


All such insurance
policies shall:


 


(i)     name
Supplier for their respective rights and interests in respect of the Project as
additional insured (except in the case of worker’s compensation insurance);


 


(ii)    provide
Supplier with 30 days’ prior written notice of non-renewal, cancellation of, or
significant modification to, any of such policies (except that such notice
period will be 10 days in case of non-payment of premiums); and


 


(iii)   The insurance
certificates provided to Supplier shall indicate that the insurance policies
have been endorsed as noted above. All policies shall be written by one or more
insurance companies authorized to do business in USA and be rated BBB+ or
higher by A.M. Best.


 


Term and
Modification of Insurance


 


If the designated
coverage, or relatively comparable coverage, are unavailable on reasonable
commercial terms, Purchaser will provide Supplier detailed information as to
the maximum amount of available coverage that it is able to purchase and will
be required to obtain Supplier’s consent as to the adequacy of said coverage
under the circumstances at the time, which consent shall not be unreasonably
withheld or delayed.


 


19

















 


ARTICLE 11


 


REPRESENTATIONS AND WARRANTIES OF
SUPPLIER


 


Supplier hereby
represents and warrants to Purchaser as follows:


 


11.1     Due Organization; Good Standing.
Supplier is a corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware, and qualified to conduct business in
the states where it does business.


 


11.2     Due Authorization. The execution,
delivery and performance of this Agreement by Supplier have been duly
authorized by all necessary corporate action on the part of Supplier and do not
and will not require the consent of any trustee or holder of any indebtedness
or other obligation of Supplier or any other Party to any other agreement with
Supplier.


 


11.3     Execution and Delivery. This
Agreement has been duly executed and delivered by Supplier. This Agreement
constitutes the legal, valid and binding obligation of Supplier, enforceable
against Supplier in accordance with its terms, except to the extent that its
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the rights of creditors generally or
by principles of equity.


 


11.4     Governmental Approvals. No
governmental authorization, approval, order, license, permit, franchise or
consent, and no registration, declaration or filing with any Governmental
Authority is required on the part of Supplier in connection with the execution,
delivery and performance of this Agreement, except those which have already
been obtained or which Supplier anticipates will be timely obtained in the
ordinary course of performance of this Agreement.


 


11.5     Supply Items; Services. The Supply
Items and the SCADA System to be delivered hereunder shall be designed and fit
for the purpose of generating electric power when operated in accordance with
the Turbine Specifications, the OMS Manual, Prudent Electrical Industry
Practices and Prudent Wind Industry Practices. The Supply Items and SCADA
System shall be new and unused and shall be free from Defects and free from defects
in title. The Services shall be performed in a competent, diligent manner in
accordance with Prudent Wind Industry Practices, Supplier’s manufacturers’
written requirements and applicable Governmental Requirements.


 


ARTICLE 12


 


REPRESENTATIONS AND WARRANTIES OF
PURCHASER


 


Purchaser represents and
warrants to Supplier as follows:


 


12.1     Due Organization; Good Standing;
Qualified To Do Business. Purchaser is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware, and qualified to conduct business in the states where it does
business.


 


20

















 


12.2     Due Authorization. The execution,
delivery and performance of this Agreement by Purchaser have been duly
authorized by all necessary action on the part of Purchaser in accordance with
Purchaser’s organizational documents and do not and will not require the
consent of any trustee or holder of any indebtedness or other obligation of
Purchaser or any other Party to any other agreement with Purchaser.


 


12.3     Execution and Delivery. This
Agreement has been duly executed and delivered by Purchaser. This Agreement
constitutes the legal, valid and binding obligation of Purchaser, enforceable
against Purchaser in accordance with its terms, except to the extent that its
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the rights of creditors generally or
by principles of equity.


 


12.4     Governmental Approvals. No
governmental authorization, approval, order, license, permit, franchise or
consent, and no registration, declaration or filing with any Governmental
Authority is required on the part of Purchaser in connection with the
execution, delivery and performance of this Agreement, except those which have
already been obtained or which Purchaser anticipates will be timely obtained in
the ordinary course of performance of this Agreement.


 


12.5     Project Site. On or prior to the
date that Supplier is to provide any services relating to the Project at the
Project Site, Purchaser shall have obtained the right and authority to have
such work performed on the Project Site. To the knowledge of Purchaser, after
the completion of reasonable due diligence on the Project Site, the Project
Site is free of all hazardous or dangerous materials or substances. All
information concerning the Project Site and the wind flow across the Project
Site heretofore delivered to Supplier by Purchaser is true, complete and
correct in all material respects.


 


ARTICLE 13


 


MUTUAL INDEMNITY


 


13.1     Mutual Indemnity. Each of Supplier
and Purchaser agree to defend, indemnify and hold each other, and each other’s
lenders, parent companies, Affiliates, officers, directors, agents and
employees, harmless from and against any claims, losses, damages and
liabilities (including, but not limited to, reasonable attorneys’ fees and
court costs, but excluding consequential damages) on account of any claim by a
third Party for bodily injury or property damage against the indemnified Party
to the extent caused by the negligent act or omission, or willful misconduct
of, or breach of this Agreement by, the indemnifying Party or the indemnifying
Party’s employees, contractors, subcontractors or agents, in connection with
the performance of their respective obligations under this Agreement.


 


ARTICLE 14


 


DEFAULT; CURE; REMEDIES


 


14.1     Default by Supplier. Supplier shall
be in default under this Agreement should any one or more of the following
events or conditions arise or exist:


 


21

















 


(i)         Supplier becomes
insolvent, or generally does not pay its debts as they become due, or admits in
writing its inability to pay its debts, or makes a general assignment for the
benefit of creditors; or


 


(ii)        Insolvency,
receivership, reorganization, or bankruptcy proceedings are commenced by or
against Supplier and, in the case of any such involuntary proceeding, that is
not dismissed or stayed within sixty (60) days after it is commenced; or


 


(iii)       Supplier fails, for
any reason, other than failure of Purchaser to make payments to Supplier when
obligated in accordance with this Agreement, to make any undisputed payments
required to be made by Supplier to Purchaser, which failure continues for ten (10) Business
Days after notice of such non-payment; or


 


(iv)       Supplier is in material
default of any term or provision of this Agreement or has materially failed to
perform its obligations under this Agreement, and such breach or failure
continues for thirty (30) Business Days following receipt of written notice
from Purchaser to cure such breach or failure; provided, however, if such
failure cannot with due diligence be remedied by Supplier within such thirty
(30) Business Days period, and Supplier shall have diligently prosecuted the
remedying of such failure within such thirty (30) Business Days, such period
shall be extended by such additional time period as may be reasonably required
by Supplier to cure such failure.


 


14.2     Purchaser’s Remedies. In the event
Supplier is in default pursuant to Section 14.1, and said default
is not timely cured within the time periods set forth above, Purchaser, in
addition to those rights and remedies that may be available to Purchaser at law
or in equity, and subject to Section 9.2 of this Agreement, shall
have the right to terminate this Agreement by written notice to Supplier;
provided however, that amounts applicable to Supply Items delivered or services
performed by Supplier through the date of termination of this Agreement shall
be paid by Purchaser to Supplier.


 


14.3     Default by Purchaser. Purchaser
shall be in default under this Agreement should any one or more of the
following events or conditions arise or exist:


 


(i)         Purchaser or Guarantor
becomes insolvent, or generally does not pay its debts as they become due, or
admits in writing its inability to pay its debts, or makes a general assignment
for the benefit of creditors; or


 


(ii)        Insolvency,
receivership, reorganization or bankruptcy proceedings are commenced by or
against Purchaser or Guarantor and, in the case of any such involuntary
proceeding, that is not dismissed or stayed within sixty (60) days after it is
commenced; or


 


(iii)       Purchaser fails to
timely pay to Supplier any required payment under this Agreement when due,
including failure to timely provide any Down Payment or any Progress Payment,
which failure continues for ten (10) days after written notice of failure
to make payment has been received by Purchaser from Supplier; or


 


22

















 


(iv)       Purchaser fails to
perform any material term or provision of this Agreement, including failure to
timely provide the Guaranty to Supplier, and such failure continues for thirty
(30) Business Days following receipt of written notice from Supplier to cure
such failure; provided, however, if such failure cannot with due diligence be
remedied by Purchaser within such thirty (30) Business Day period, and
Purchaser shall have diligently prosecuted the remedying of such failure within
such thirty (30) Business Days, such period shall be extended by such
additional time period as may be reasonably required by Purchaser to cure such
failure; or


 


(v)           The revocation or other termination
of the Guaranty by Guarantor, or the breach by Guarantor of any material term
or provision of the Guaranty, including any payment obligation thereunder,
which breach continues for a period of ten (10) days after written notice
of such breach has been received by Guarantor from Supplier.


 


14.4     Supplier’s Remedies. In the event
that Purchaser is in default pursuant to Section 14.3, and said
default is not timely cured within the time periods set forth above, Supplier
in lieu of any rights and remedies that may be available to Supplier at law or
in equity, shall have the right to terminate this Agreement by written notice
to Purchaser, which termination shall be effective upon delivery of Supplier’s
notice to Purchaser. Within three (3) Business Days of the effective date
of such termination, Purchaser shall pay to Supplier the liquidated damages set
forth on the termination schedule attached hereto as Exhibit G
(“Termination Schedule”), which shall constitute Supplier’s exclusive remedy,
and Supplier shall have no right to damages or compensation for such termination
other than payment of the liquidated damages set forth on the Termination
Schedule.


 


14.5     Cancellation Due to a Force Majeure
Event. If Supplier is entirely prevented from performing its obligations
hereunder for a period of one-hundred eighty (180) consecutive days as a result
of the occurrence of a Force Majeure Event suffered by Supplier, then Supplier
may cancel, without additional liability, any then remaining unperformed
portion of this Agreement, upon not less than thirty (30) Business Days’ prior
written notice to the Purchaser; provided, however, that nothing in this Section 14.5
shall relieve or excuse Supplier from its obligations under Article 7
of this Agreement in respect of the occurrence of a Force Majeure Event or
relieve either Party from any payment obligation that has accrued as of the
date of cancellation or prior thereto; provided further, however, that any
payment obligations of Purchaser shall be reduced by the amount of funds
received by Supplier, if any, in connection with the resale of any Turbines or
Turbine components sold that are applicable to such payment obligations of
Purchaser, and, if following such reduction, Purchaser is owed a refund of some
portion of the Purchase Price from Supplier, Supplier shall refund to Purchaser
the applicable amount of Purchase Price previously paid to Supplier within
thirty (30) days of such termination.


 


14.6     Termination *****. Purchaser shall
have the right, only at any time up to, and not later than, ***** prior to the
scheduled date for Delivery of the first Major Turbine Component to be
Delivered under this Agreement pursuant to the Delivery Schedule, upon the
occurrence of a ***** to terminate all of the Turbine Supply Documents upon *****
prior written notice to Supplier. *****


 


23

















 


*****. Upon written
notice from Purchaser, Supplier shall use commercially reasonable efforts to
provide Purchaser with ***** reasonably requested by Purchaser regarding *****.
In the event that the Parties disagree whether a ***** has occurred, the matter
shall be resolved in accordance with the dispute resolution procedures set
forth in Article 15 of this Agreement. If a ***** occurs prior to *****
prior to the scheduled Delivery Date of the first Major Turbine Component, such
***** shall not exist in the Turbines to be Delivered in accordance with this
Agreement.


 


14.7     Termination for Convenience. The
Purchaser shall have the right to terminate this Agreement for convenience with
respect to any Turbine until title to such Turbine has passed to Purchaser.
Such termination shall be effective upon the later to occur of (i) delivery
to Supplier of written notice of termination and (ii) receipt by Supplier
of liquidated damages in the amount on a per Turbine basis with respect to such
Turbine in accordance with the Termination Schedule attached to this Agreement
as Exhibit G.


 


14.8     Surviving Obligations. Cancellation
or expiration of all or any portion of this Agreement (a) shall not
relieve Purchaser of its obligations with respect to the confidentiality of
Supplier’s proprietary information as set forth in Section 4.5 of
this Agreement, or either Party of its confidentiality obligations as set forth
in Section 16.9 of this Agreement, (b) shall not relieve either
Party of any obligation hereunder which expressly or by implication survives
termination hereof, and (c) except as otherwise provided in any provision
of this Agreement expressly limiting the liability of either Party, shall not
relieve either Purchaser or Supplier of any obligations or liabilities for loss
or damage to the other Party arising out of or caused by acts or omissions of
such Party prior to the effectiveness of such termination or arising out of
such termination, and shall not relieve Supplier of its obligations as to
portions of the items supplied or other services hereunder already supplied or
performed or of obligations assumed by Supplier prior to the date of
termination. This Article shall survive the termination or expiration of
this Agreement.


 


ARTICLE 15


 


DISPUTE RESOLUTION


 


15.1     Procedure. In the event a dispute,
controversy or claim (herein, a “dispute”) arises between Purchaser and
Supplier relating to this Agreement, the aggrieved Party shall promptly provide
written notification of the dispute to the other Party within ten (10) days
after such dispute arises and the Parties shall resolve such dispute as
provided herein:


 


15.1.1      Executives Meeting. A meeting shall
be held between the Parties, attended by representatives of the Parties with
decision-making authority regarding the dispute, to attempt in good faith to
negotiate a resolution of the dispute. Such meeting shall be held in
Carpinteria, California within thirty (30) days after a notice of dispute has
been delivered under Section 15.1 above.


 


24

















 


15.1.2      Independent Engineer’s Decision. If
the dispute involves a technical issue, within ten (10) days after such
meeting, the Parties have not resolved the dispute, either Party shall submit
the dispute to the Independent Engineer for a non-binding determination,
together with such information in support of their position as may be relevant,
which information will simultaneously be sent to the other Party. The
Independent Engineer may hold separate meetings with each Party or call a joint
meeting of the Parties, to be held in Carpinteria, California. The Independent
Engineer shall, within thirty (30) days after such request for a determination,
issue a non-binding decision. Any Party which does not wish to comply with such
decision shall promptly provide written notification of its intention to the
other Party within five (5) days of such decision. The Parties shall meet
in Chicago, Illinois within twenty (20) days of such notice to attempt, in good
faith, to negotiate a final resolution to the dispute. Any Party which does not
wish to comply with such decision shall within ten (10) days after the
date of such meeting submit the dispute to arbitration within twenty (20) days
after the date of such decision to arbitration in accordance with Section 15.1.3
below. The Parties shall share equally the costs of the Independent Engineer.


 


15.1.3      Arbitration.


 


(a)        If the Parties are not successful in
resolving a dispute, controversy or claim pursuant to Sections 15.1.1
and 15.1.2, above, then such dispute shall be resolved through binding
arbitration to take place in Chicago, Illinois. The Parties agree to conduct
all arbitration proceedings in accordance with the Commercial Arbitration Rules of
the American Arbitration Association. This Section 15.1.3 is
governed by the Federal Arbitration Act.


 


(b)        A Party desiring to submit to
arbitration any such dispute, controversy or claim shall furnish its demand for
arbitration in writing to the other Party or Parties thereto, which demand
shall contain a brief statement of the matter in controversy, as well as a list
containing the names of three (3) suggested arbitrators from the list of
arbitrators maintained by the American Arbitration Association (the “AAA List”)
from which list, or from other sources, all of the Parties shall choose one (1) mutually
acceptable arbitrator. If the Parties are unable to agree upon the identity of
a single arbitrator, within ten (10) days from the receipt of such demand,
the Purchaser and the Supplier shall each (collectively, the “Arbitrating
Parties”), within a period of five (5) additional days, name from the
AAA List one (1) arbitrator by written notice to the other Arbitrating
Party or Parties. Within ten (10) days after this notice, the two (2) arbitrators
so named shall choose a third arbitrator. If any Arbitrating Party fails to
name an arbitrator within the specified five (5) day period or if the two
arbitrators chosen by the Arbitrating Parties fail to select a third arbitrator
within the ten (10) day period, then either Arbitrating Party, on behalf
of and on notice to the other Arbitrating Party or Parties, may request
appointment by the American Arbitration Association in accordance with its rules then
prevailing of the required additional arbitrator or arbitrators so that there
shall be a panel of three (3) arbitrators. If the American Arbitration
Association should fail to appoint the necessary arbitrator or arbitrators
within fifteen (15) days after such request is made, then either Arbitrating
Party may apply, on notice to the other Arbitrating Party or Parties, to a
court of competent jurisdiction for the appointment of such necessary
additional arbitrators. Each of the arbitrator or arbitrators chosen or appointed
pursuant to this Section 15.1.3(b) shall be a person having at
least ten (10) years experience in the United States in the legal
profession and shall


 


25

















 


not be a past or present
officer, director or employee of, or have any material interest in, any
Arbitrating Party or any Affiliate of an Arbitrating Party. All discovery,
including the right to take depositions and interrogatories, shall be permitted
in the time and manner provided by the then applicable Federal Rules of
Civil Procedure. The Arbitrating Parties shall be entitled to reasonable
discovery prior to the arbitration hearing, and the arbitrator or arbitrators,
as the case may be, shall have the power upon application of any Arbitrating
Party to make all appropriate orders for discovery from the other Arbitrating
Party, including discovery of documents, responses to interrogatories, and
depositions. The scope, time and manner of discovery, including all document
discovery, are to be in accordance with the U.S. Federal Rules of Civil
Procedure. Notwithstanding the foregoing, discovery allowed each of the
Arbitrating Parties shall not exceed: (i) five (5) party depositions;
(ii) three (3) nonparty depositions; (iii) three (3) depositions
of any experts selected to give opinions in the arbitration (as well as the
production of any documents relied upon by such experts); and (iv) fifteen
(15) interrogatories (with each subpart counted as a separate interrogatory).
Discovery shall not include requests for admissions. No deposition shall last
more than two (2) days in length. Further, all discovery must, without
exception, be completed within one hundred twenty (120) days from the date the
arbitration panel is appointed. Any documents that are not produced to the
other Arbitrating Party prior to the termination of this 120-day discovery
period may not be offered into evidence at the arbitration hearing unless such
production shall not prejudice the non-producing Arbitrating Party as
determined by the arbitrator or arbitrators, as the case may be. Likewise, any
witnesses who have not been produced for deposition, despite a request from the
other side, may not testify or submit affidavits at the arbitration hearing.


(c)        The arbitrator or arbitrators, as the case
may be, shall render his, her or their decision, in the latter case upon the
concurrence of at least two (2) of their number, as soon as possible but
no later than thirty (30) days after the conclusion of any hearings before such
arbitrator or arbitrators, as the case may be, unless such 30-day period is
extended by the arbitrator or arbitrators, as the case may be. The decision and
award shall in either case be in writing and counterpart copies of such
decision shall be delivered to each of the Arbitrating Parties. Such decision
shall be based solely upon the written arguments and contentions, evidence and
legal authorities, submitted by each Arbitrating Party. In rendering such
decision and award, the arbitrator shall not add to, subtract from or otherwise
modify the provisions of this Agreement. Any award rendered shall be final and
conclusive upon the parties and a judgment on any such award may be entered in
any court having jurisdiction, state or federal, having jurisdiction. No
arbitration proceeding shall be commenced after the date when institution of
legal or equitable proceedings based upon such subject matter would be barred
by the applicable statute of limitations. Notwithstanding anything to the
contrary contained in this section or elsewhere in this Agreement, provisional
injunctive or other provisional equitable relief may be sought by the parties
without first submitting the subject dispute to arbitration so long as
injunctive relief is otherwise warranted by applicable law.


 


15.2     Qualifications of Arbitrators; Expenses.


 


(a)        The arbitrators in the arbitration
proceeding provided for in this Article 15 shall be individuals
experienced in the energy construction industry and competent to pass on the
matter presented for arbitration.


 


26

















 


(b) Supplier,
on the one hand, and Purchaser, on the other, shall share equally the
compensation and expenses of the arbitrators as well as all fees imposed by the
AAA. Supplier and Purchaser shall be responsible for their own costs and legal
fees, if any. Notwithstanding the foregoing, a majority of the arbitrators
shall be empowered to award the prevailing Party its costs, expenses and/or
legal fees.


 


15.3     Performance During Dispute. While
any controversy, dispute or claim arising out of or relating to this Agreement
is pending, Purchaser and Supplier shall continue to perform their obligations
hereunder notwithstanding such controversy, dispute or claim.


 


15.4     Consolidation. No arbitration
arising under this Agreement shall include, by consolidation, joinder or any
other manner, any person or entity not a Party to this Agreement, unless (a) such
person or entity is substantially involved in a common question of fact or law,
(b) the presence of such person or entity is required if complete relief
is to be accorded in the arbitration, and (c) such person or entity has
consented to such inclusion.


 


15.5     Language. All arbitration
proceedings shall be conducted in the English language.


 


ARTICLE 16


 


GENERAL PROVISIONS


 


16.1     Waiver. No delay or omission by the
Parties hereto in exercising any right or remedy provided for herein shall
constitute a waiver of such right or remedy nor shall it be construed as a bar
to or waiver of any such right or remedy on any future occasion.


 


16.2     Successors and Assigns. This
Agreement shall be binding upon and shall inure to the benefit of the
successors and permitted assigns of Supplier and Purchaser. Except as set forth
herein, neither Supplier nor Purchaser may assign, convey or transfer this
Agreement, in whole or in part, except upon the prior written consent of the
other Party hereto, which consent shall not be unreasonably withheld, and any
such purported transfer or assignment shall be null and void. Notwithstanding
any permitted assignment hereunder, the assignor shall remain liable to the
other Party for all duties and responsibilities hereunder unless affirmatively
recited by the other Party.


 


16.3     Permitted Assignments.
Notwithstanding Section 16.2 above, (i) either Party may transfer
or assign its rights, benefits and obligations under this Agreement to an
Affiliate; provided, that if requested by Purchaser, Supplier shall execute and
deliver a guaranty of the performance hereunder by such an assignee, (ii) Purchaser
may assign its rights, benefits and obligations under this Agreement to any
purchaser of the Project; provided, that Purchaser may not transfer or assign
this Agreement in whole or in part to a wind turbine design or manufacturing
competitor of Supplier without the prior written consent of Supplier, which
consent may be withheld in Supplier’s sole discretion and which may be
conditioned upon the creditworthiness of the purchaser, (iii) Supplier is
authorized to subcontract any portion of its duties under this Agreement to a
third party or to delegate its obligations hereunder, in the ordinary course of
its business, without reducing the scope of Supplier’s undertakings,
obligations, and commitments to Purchaser, provided that Supplier agrees that
it will not use any supplier for any Major Turbine Components not listed on Exhibit H
without Purchaser’s advance written consent, such consent not to be
unreasonably withheld,


 


27

















 


conditioned or delayed,
and (iv) a Party, without the consent of the other Party, may assign its
interest in this Agreement to a lender, collateral trustee, security trustee or
similar entity as collateral security for any financing entered into by the
assigning Party, including a lease financing. The non-assigning Party shall,
upon fifteen (15) days’ prior written request from the assigning Party, execute
a consent containing customary terms and conditions, to any such collateral
assignment. Further, notwithstanding Section 16.2 above, Purchaser
shall have the right to assign no less than all of its rights, duties and
obligations under the Turbine Supply Documents to any third party, subject to,
and conditioned upon, the prior written consent of Supplier, which shall not be
unreasonably withheld, conditioned, or delayed; provided however that any such
assignment is conditioned upon the receipt of a guarantee for the benefit of
Supplier of the performance of the contract obligations, including payment
security, in a form acceptable to Supplier, in its sole and absolute
discretion. Any such assignment to a third party also shall be subject to the
following: (i) prior to the effectiveness of such assignment, the third
party assignee shall agree to revisions to the Turbine Supply Documents as
determined by Supplier to be reasonably necessary, to effect the purchase and
installation of the Turbines by the third party assignee at a project site to
be determined between Supplier and any such third party assignee, (ii) the
third party assignee shall assume all of the duties, obligations, restrictions
and covenants of Purchaser under the Turbine Supply Documents, as revised, (iii) any
monies or other consideration received by, or otherwise payable to, Purchaser
from the third party assignee in connection with such assignment, in excess of
the Down Payment and any Progress Payments actually paid by Purchaser to
Supplier, other than the reasonable actual documented expenses incurred by
Purchaser in connection with the assignment of the Turbine Supply Documents to
the third party, shall be paid to Supplier and (iv) Purchaser shall pay to
Supplier all of Supplier’s costs associated with such assignment from Purchaser
to the third party assignee, including but not limited to all of Supplier’s
costs (including reasonable legal fees) incurred in connection with the
revision of the Turbine Supply Documents, within thirty (30) days of receipt of
an applicable invoice from Supplier.


 


16.4     Notices.


 


(a)        Any notice required or authorized to be
given hereunder or any other communications between the Parties provided for
under the terms of this Agreement shall be in writing (unless otherwise
provided) and shall be served personally or by reputable express courier
service or by facsimile transmission addressed to the relevant Party at the
address stated below or at any other address notified by that Party to the
other as its address for service. Any notice so given personally shall be
deemed to have been served on delivery, any notice so given by express courier
service shall be deemed to have been served two (2) Business Days after
the same shall have been delivered to the relevant courier, and any notice so
given by facsimile transmission shall be deemed to have been served on
dispatch. As proof of such service it shall be sufficient to produce a receipt
showing personal service, the receipt of a reputable courier company showing
the correct address of the addressee or an activity report of the sender’s
facsimile machine showing the correct facsimile number of the Party on whom
notice is served and the correct number of pages transmitted.


 


28

















 


(b)        The Parties’ addresses for service are:


 




	
  To Purchaser:

  	
   

  	
  UPC Wind Acquisition V,
  LLC

  
	
   

  	
   

  	
  c/o UPC Wind
  Management, LLC

  
	
   

  	
   

  	
  85 Wells Ave.,
  Suite 305

  
	
   

  	
   

  	
  Newton, MA 02459

  
	
  Attn:

  	
   

  	
  General Counsel

  
	
   

  	
   

  	
  Facsimile:     (617)
  964-3342

  
	
   

  	
   

  	
  Telephone:    (617)
  964 3340

  
	
   

  	
   

  	
   

  
	
  To Supplier:

  	
   

  	
  Clipper Turbine
  Works, Inc.

  
	
   

  	
   

  	
  6305 Carpinteria
  Avenue, Suite 300

  
	
   

  	
   

  	
  Carpinteria, California
  93013

  
	
   

  	
   

  	
  Attn:            General
  Counsel

  
	
   

  	
   

  	
  Facsimile:    805.899.1115

  
	
   

  	
   

  	
  Telephone:   805.690.3275

  
	
   

  	
   

  	
   

  
	
  with a copy to:

  	
   

  	
  Chadbourne &
  Parke LLP

  
	
   

  	
   

  	
  350 South Grand Avenue,
  Suite 3300

  
	
   

  	
   

  	
  Los Angeles, CA 90071

  
	
   

  	
   

  	
  Attn:             Edward
  W. Zaelke

  
	
   

  	
   

  	
  Facsimile:     213.622.9865

  
	
   

  	
   

  	
  Telephone:    213.892.1000

  






 


16.5     Governing Law. This Agreement and
all matters arising hereunder or in connection herewith shall be governed by
and construed in accordance with the laws of the State of New York, without
regard to conflicts of law principles.


 


16.6     Amendments. This Agreement may be
modified or amended only by an instrument in writing signed by the Parties
hereto.


 


16.7     Attachments Incorporated. The
preamble and recitals of this Agreement, and the Exhibits attached hereto, are
hereby incorporated into and made a part of this Agreement.


 


16.8     Entire Agreement. The terms and
conditions set forth herein, together with those set forth on all Exhibits
attached hereto, constitute the complete statement of the agreement between
Supplier and Purchaser relating to the subject matter hereof. No prior
statement or correspondence shall modify or affect the terms and conditions
hereof. Prior representations, promises, warranties or statements by Supplier
or Purchaser, or by any agent or employee of Supplier or Purchaser, that differ
in any way from the terms and conditions hereof shall be given no effect.


 


16.9     Confidentiality. Each Party agrees
to keep the terms and provisions of this Agreement and all materials and
information that each receives pursuant hereto or in connection herewith or in
connection with the Project in the strictest confidence and not to disclose any
of the foregoing to any party other than the respective lenders, investors,
attorneys, accountants, Affiliates, officers and directors of each Party or as
such Party may be required by law, court order or in any litigation to
disclose. This Section 16.9 shall survive the termination of this
Agreement. Notwithstanding the foregoing, Supplier shall be entitled to
announce by press release or other means that it has agreed to furnish the
Turbines for the Project. The Parties agree that, with respect to press
releases concerning the Project, they will endeavor to cooperate and share
information with one another so that the Parties are identified, to the extent
practicable in press releases regarding the


 


29

















 


Project. Supplier and
Purchaser will each provide copies of all press releases issued regarding the
Project to the other. Furthermore, the restrictions of this Section 16.9
shall not prohibit or restrict Supplier from using or disclosing the
availability and performance data from the Project in connection with its
sales, maintenance and other internal purposes; provided, however, that no
specific reference shall be made to the Project in connection with the
disclosure of such data.


 


16.10   Counterparts. This Agreement may be
executed by the Parties in one or more counterparts, all of which taken
together, shall constitute one and the same instrument. The exchange of copies
of this Agreement and of signature pages by facsimile transmission shall
constitute effective execution and delivery of this Agreement as to the Parties
and may be used in lieu of the original Agreement for all purposes (and such
signatures of the parties transmitted by facsimile shall be deemed to be their
original signatures for all purposes).


 


16.11   English Language Documents. Any
document, manual, certificate or notice required or authorized to be given
hereunder for the operation of the Project shall be provided in the English
language.


 


16.12   Severability. In case any provision in
this Agreement is held to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions shall not be affected.


 


16.13   Headings. The headings and captions
used in this Agreement are inserted for reference and convenience only and the
same shall not limit or construe the sections, articles or paragraphs to which
they apply or otherwise affect the interpretation thereof.


 


16.14   Agreement Revisions. Following the
execution of this Agreement by the Parties, if either Party requests a change
to the Agreement in order to (i) correct any inconsistency contained
within the Agreement or among the Turbine Supply Documents or (ii) clarify
any ambiguities in the Agreement to reflect the intent of the Parties, then the
Parties agree to work in good faith to amend the language of the Agreement to
conform to any such requested change.


 


30














 


IN WITNESS
WHEREOF, this Agreement has been executed and delivered by the duly authorized
representatives of Purchaser and Supplier as of the date first written above.


 


	
   

  	
  CLIPPER TURBINE WORKS,
  INC., 

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						



 


 


	
   

  	
  UPC WIND ACQUISITION V,
  LLC, 

  
	
   

  	
  a Delaware limited
  liability company

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Gaynor

  
	
   

  	
  Name:

  	
  Paul Gaynor

  
	
   

  	
  Title:

  	
  President

  
						



 


 


[Signature Page to Turbine

Supply Agreement]


 

















 


IN WITNESS
WHEREOF, this Agreement has been executed and delivered by the duly authorized
representatives of Purchaser and Supplier as of the date first written above.


 


	
   

  	
  CLIPPER TURBINE WORKS,
  INC.,

  
	
   

  	
  a Delaware corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Gates

  
	
   

  	
  Name:

  	
  Robert Gates

  
	
   

  	
  Title:

  	
  Sr. Vice Pres

  
						



 


 


	
   

  	
  UPC WIND ACQUISITION V,
  LLC, 

  
	
   

  	
  a Delaware limited
  liability company

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
						



 


 


UPC 2013


 


[Signature Page to Turbine

Supply Agreement]


 

















 


APPENDIX I


 


DEFINITIONS


 


“Additional Cost
Event” means (a) an Emergency, (b) a Force Majeure Event or an
Operating Force Majeure Event, (c) damage caused by an act or omission of
the Owner or a third party (other than an Affiliate, Subcontractor or other
agents or designees of the Operator) which is required to be repaired in order
for the Turbines to be operated and maintained in accordance with the standard
set forth in this Agreement, or (d) the receipt by the Operator of a
written request from the Owner for the Operator’s performance of Additional OMS
Services.


 


“Affiliate” means,
with respect to any Party, any Person or entity which, directly or indirectly,
is in control of, or is controlled by, or is under common control with such
Party or any Subsidiary of such Party. For the purposes of this definition,
control of a Party shall mean the power, direct or indirect, (a) to vote
in excess of fifty percent (50%) or more of the securities having ordinary
voting power for the election of directors, (b) to direct or cause the
direction of the management and policies of such Party, whether by contract or
otherwise.


 


“After Tax Value”
means an amount equal to the sum of any payment, credit or other original
amount (the “Original Amount”) plus an amount that will cause the recipient to
retain a sum equal to the Original Amount after federal income taxes at the
highest marginal rate are or would be imposed on the After Tax Value.


 


“Agreement” means
the Supply Agreement, the Warranty Agreement or the OMS Agreement, as the
context requires.


 


“Ancillary Parts
and Equipment” means those ancillary parts, materials and equipment listed in Exhibit A
to the Supply Agreement, which are typically required, together with the Major
Turbine Components, to form a Turbine.


 


“Annual Windsystem
Availability” or “AWA” has the meaning given in Exhibit A to the
Warranty Agreement.


 


“Availability” has
the meaning given in Exhibit A to the Warranty Agreement. 


 


“Available Hours”
has the meaning given in Exhibit A to the Warranty Agreement.


 


“Average Nominal
Measured Energy” or “ANME” has the meaning given in Exhibit C to
the Warranty Agreement.


 


“AWA Period
Revenue” shall have the meaning given in Exhibit A to the Warranty
Agreement.


 


“Base Hours” has
the meaning given in Exhibit A to the Warranty Agreement.


 


“Business Days”
means Monday through Friday of each week, except holidays in which commercial
banks in the United States are required or permitted to close.


 


I-1

















 


“Change in Law”
means, after the date hereof, the enactment, modification or repeal or any
Governmental Requirements, or any change in the interpretation of any
Governmental Requirements by any Governmental Authority or court of law, that
materially affects Supplier’s schedule for performing any of its obligations
hereunder; provided a change in applicable tax law shall not constitute a “Change
in Law” hereunder.


 


“Commencement Date”
means the date upon which the Supplier shall have timely received the entirety
of (a) the Down Payment, (b) the Parent Guaranty, and such other fees
as may be applicable.


 


“Commissioning” or
“Commissioning Work” means the installation inspection, field commissioning and
acceptance testing, and controller power-up test, and start-up work to be
conducted by Supplier under the Supply Agreement, for each Turbine, in
accordance with the Commissioning and Start-Up Procedures.


 


“Commissioning and
Start-Up Procedures” means the field commissioning and acceptable testing and
start-up test and inspection procedures set forth on Exhibit O of
the Supply Agreement.


 


“Commissioning
Certificate” means a certificate issued by Supplier to Purchaser, in the form
attached as Exhibit M to the Supply Agreement, following completion
of Commissioning of each Turbine.


 


“Complete” or “Completion”
shall mean, with respect to any Turbine, that (i) all Turbine Components
have been delivered to the Project Site and installed in accordance with the
Installation Procedures, (ii) Purchaser has completed the necessary
terminations and connections of the collection lines and the SCADA
communication lines into the controller in the base of the Turbine Tower using
the collection lines and SCADA communication lines supplied by Purchaser, and (iii) the
Turbine has been Commissioned.


 


“Completion
Schedule” shall mean the schedule for the completion by Supplier and Purchaser,
as applicable, of Turbine installation and Commissioning as set forth in Exhibit T
to the Supply Agreement.


 


“CPI” shall mean
the Consumer Price Index for the United States City Average, All Urban
Consumers (CPI-U), All Items (base index year 1982-1984=100), as published by
the United States Department of Labor, Bureau of Labor Statistics.


 


“Default Rate”
means a per annum rate of interest equal to the lesser of (a) the maximum
rate permitted by law and (b) twelve percent (12%) per annum.


 


“Defect” means a
defect in any part or component of a Turbine covered under the Standard
Warranty that causes such part or component to fail during the Warranty Period.
A component is deemed to have “failed” only when it either (i) breaks, or (ii) ceases
to perform the operation for which it was designed, intended or installed;
provided, however, that normal wear and tear shall not constitute failure.


 


I-2

















 


“Delivery” or “Delivered”
means when a Supply Item is made available by Supplier for pickup by Purchaser
at its respective Designated Delivery Location, provided however, that
Purchaser may not take custody and control of the said Supply Item until the
applicable Progress Payment has been made by Purchaser and received by
Supplier.


 


“Delivery Schedule”
shall mean the schedule as set forth in Exhibit L to the Supply
Agreement for the Delivery by Supplier of the Supply Items to the Designated
Delivery Locations.


 


“Designated
Delivery Location” shall have the meaning given in Section 5.4 of
the Supply Agreement.


 


“Down Payment”
shall have the meaning given in Section 3.1 of the Supply
Agreement.


 


“Down Payment Date”
shall have the meaning given in Section 3.1 of the Supply
Agreement.


 


“Effective Date”
shall mean the date of the Supply Agreement.


 


“Electrical Infrastructure”
means the pad mounted transformers, feeder lines, high voltage feeder lines,
switches and all other related facilities owned by Purchaser through which the
electrical power generated by the Turbine is transferred from the point of
connection at the Turbine Controller to the Interconnection Facilities.


 


“Emergency” means
an event occurring at the Project Site, or the Maintenance and Spare Parts
Facility or any adjoining property that poses actual or imminent risk of
serious personal injury or material physical damage to the Project, or parts
thereof, requiring immediate preventative or remedial action.


 


“Environmental
Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees,
judgments, injunctions, notices or binding agreements issued, promulgated or
entered into by any Governmental Authority, relating in any way to the
environment, preservation or reclamation of natural resources, the management,
environmental release or threatened environmental release of any Hazardous Substance
or to health and safety matters, including the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, 42 U.S.C. §§ 9601 et seq.;
the Resource Conservation and Recovery Act, as the same may be amended from
time to time, 42 U.S.C. §§ 6901 et seq.; the Federal Water Pollution Control
Act, 33 U.S.C. §§ 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. §§
2601 et seq.; the Clean Air Act, 42 U.S.C. §§ 7401 et seq.; the Safe Drinking
Water Act, 42 U.S.C. §§ 3803 et seq.; the Oil Pollution Act of 1990, 33 U.S.C.
§§ 2701 et seq.; the Emergency Planning and the Community Right-to-Know Act of
1986, 42 U.S.C. §§ 11001 et seq.; the Hazardous Material Transportation Act, 49
U.S.C. §§ 1801 et seq. and the Occupational Safety and Health Act, 29 U.S.C. §§
651 et seq.; and any state and local counterparts or equivalents, in each case
as amended from time to time.


 


“EPC Contract”
means that certain agreement(s), if any, by and between Purchaser and EPC
Contractor(s), for the erection of the Turbine and the design, supply,
construction, installation and commissioning of (i) crane pads, laydown
areas, temporary construction roads


 


I-3

















 


and storage yards, (ii) permanent
roads, Turbine foundations and transformer foundations, (iii) the
Electrical Infrastructure, (iv) the SCADA System, including communication
lines, (v) any control and operation and maintenance buildings and
facilities (vi) and other civil and electrical elements and other work for
the Project.


 


“EPC Contractor(s)”
means such person or entity selected by Purchaser as principal contractor for
performing work under the EPC Contract.


 


“Escrow Agent”
means such party as agreed upon by Supplier and Purchaser to serve as the
escrow agent.


 


“FAA” means the
Federal Aviation Administration.


 


“Final Assembly
Work” shall mean the final assembly work for the completion of Turbine
component assembly, as set forth in Exhibit P to the Supply
Agreement, prior to the installation of the Turbine.


 


“Financing
Documents” means the financing agreement, by and among the Purchaser or one of
its Affiliates, and the lenders or other financial institutions from time to
time party thereto by which the Purchaser or one of its Affiliates intends to
raise capital to finance the construction of the Project.


 


“Force Majeure
Event” means any event beyond the reasonable control of the Party affected
which materially affects its performance hereunder, including, without
limitation: war, hostilities, insurrection, riot, vandalism or other public
disorder or civil disturbance; terrorism; perils at sea, acts of God, fire,
hurricanes, tornadoes (including tornado watches or warnings for the Project
Site issued by the National Weather Service), mudslides, hail, earthquakes, lightning,
other extreme weather conditions, and, during Commissioning or repairs, wind in
excess of fifteen (15) meters per second or that would make necessary lifting
unsafe, but only for so long as such winds persist; expropriation or
confiscation; strikes, lockouts or other labor disputes; perils at sea; or
unforeseen delays in transportation or shipping, including with respect to
roadways, harbors, ports and other transportation and shipping infrastructure;
any Change in Law; or damage to any part of Supplier’s factories or assembly
plants, or the factories or assembly plants of its Subcontractors. Force
Majeure Events shall include those Force Majeure Events experienced by any of
Supplier’s Subcontractors in circumstances where Supplier is not able to reasonably
reallocate the work of that Subcontractor to an alternative vendor.


 


“Germanischer Lloyd” means Germanischer Lloyd Windenergie GMBH.


 


“Germanischer
Lloyd Turbine Certification”, “GL Certificate” or “GL Certified” means a
certification of the Turbine to be issued by Germanischer Lloyd.


 


“Governmental
Authority” means the government or any federal, state, municipal or other
political subdivision in which the Project is located, or any other
governmental or political subdivision thereof exercising jurisdiction over the
Project or, with respect to their rights and obligations hereunder or, with
respect to the Project, the Parties, including all agencies and
instrumentalities of such governments and political subdivisions.


 


I-4

















 


“Governmental
Requirements” means all laws, statutes, codes, rules, regulations, orders, and
decrees of any Governmental Authority in effect on the date hereof, including
all authorizations, consents, registrations, exemptions, Permits and licenses
with or from any Governmental Authority, applicable to the Project or, with
respect to their rights and obligations hereunder or with respect to the
Project, the Parties.


 


“Guarantor” means
UPC Wind Partners, LLC as guarantor under that certain Guaranty to be entered
into between Supplier and UPC Wind Partners, LLC.


 


“Hazardous
Substances” means all explosive or radioactive substances or wastes and all
hazardous or toxic substances, wastes or other pollutants, including petroleum
or petroleum distillates, asbestos or asbestos containing materials,
polychlorinated biphenyls, radon gas, infectious or medical wastes and all
other substances or wastes of any nature regulated pursuant to any
Environmental Law.


 


“Independent
Engineer” means Garrad Hassan, Germanischer Lloyd, the National Renewable
Energy Laboratory, or Global Energy Concepts, or such other independent
engineer as mutually agreed.


 


“Installation
Procedures” means the procedures for the proper (i) assembly, erection and
installation of the Towers on the Turbine foundations supplied by Purchaser, (ii) grouting
of the Turbines to the Tower foundations and tightening of all bolts using the
appropriate torque; (iii) assembly, erection and installation of the
Turbine Nacelles and Turbine Blades upon the Towers as specified in the Turbine
Specifications, Prudent Wind Industry Practices and Prudent Electrical Industry
Practices; (iv) installation and testing of the Turbine electrical cables,
communication cables, and control panels within the Turbine, and (v) connection
of the cables from each Turbine Nacelle to the main circuit breaker within the
ground controllers, all in accordance with the Turbine Installation Manual.


 


“Installation Work”
means the work required pursuant to the Installation Procedures to assemble,
erect and install the Turbines.


 


“Intellectual
Property Rights” means and refers to all patents, copyrights, trademarks,
service marks, trade secrets and all similar and related intellectual property
rights protected under any statutes, laws, codes, rules or regulations and
any licenses and other rights obtained by Supplier or its Affiliates from third
parties.


 


“Interconnection
Facilities” means all the land rights, materials, equipment and facilities to
be installed by Purchaser for the purpose of interconnecting the Turbines to
the Project’s substation so as to permit the delivery of electrical energy
generated by the Turbines to the interconnection point within the Project’s
substation, which shall include, but shall not be limited to, electrical
interconnection, switching, metering, relaying, communication and safety
equipment.


 


“Lenders” shall
mean those lenders providing financing for the Project.


 


“Maintenance and
Spare Parts Facility” means the location from which Operator will perform the
OMS Services.


 


I-5

















 


“Major Turbine
Components” means the Turbine Nacelle, Turbine Controller, Turbine hub, Turbine
Blades and Tower for each Turbine, as such items are more particularly
described in the Turbine Specifications.


 


*****


 


“Nominal Expected
Energy” or “NEE” has the meaning given in Exhibit C of the Warranty
Agreement.


 


“Nominal Measured
Energy” or “NME” has the meaning given in Exhibit C of the Warranty
Agreement.


 


“OMS Agreement”
means that certain Operation and Maintenance Service Agreement, executed or to
be executed between Supplier (or an Affiliate of Supplier) and Purchaser (or an
Affiliate of Purchaser) of even date herewith, pursuant to which Supplier (or
an Affiliate of Supplier) will operate, maintain and service the Turbines.


 


“OMS Manual” means
the detailed operations, and maintenance service manual for the Turbines
supplied to Purchaser by Supplier, together with any future updates and
supplements thereto provided by Supplier.


 


“Operating Force
Majeure Events” means any event beyond the reasonable control of Supplier or
Operator, as applicable, including, without limitation, (i) war,
hostilities, insurrection, riot, vandalism or other public disorder or civil
disturbance; acts of God, fires, hurricanes, thunder storms (including thunder
storm watches or warnings declared for the area including the Project Site by
the National Weather Service), tornadoes (including tornado watches or warnings
declared for the area including the Project Site by the National Weather
Service), mudslides, hail, earthquakes, lightning (including lightning blade
strikes), or explosions; expropriation or confiscation, strikes, lockouts or
other labor disputes, a Change in Law; epidemic or quarantine; damage or
obstruction to any part of the Project caused by persons other than Supplier,
its Affiliates or their respective Subcontractors; a condition at the Site that
would not reasonably have been discovered by a project supplier comparable in
experience to Supplier conducting a competent and diligent visual inspection, (ii) wind
velocity at a constant speed or in gusts such that a reasonably prudent
professional qualified operator engaged in the business of performing routine
maintenance on wind energy generation facilities comparable to the Project
owned by it, acting for the advancement and protection of its own economic
interests, would not make the required repair at such time due to risks to
persons or property, (iii) with respect to the Turbines, any conditions at
the Project Site that are either outside the operating parameters or standards
for an IEC Class IIB wind turbine, as published as of the Effective Date
by the IEC, or outside the operating parameters or standards for the Turbine,
as set forth in the Turbine Specifications, which operating parameters or
standards may include, without limitation, conditions involving ambient
temperatures or wind speed and/or turbulence at the air density at the Project
Site, (iv) delays caused by inclement weather within the vicinity of the
Project Site and affecting the operation of the Project to the extent that such
inclement weather is materially greater than that normally experienced for the
time of year and locality and (v) unavailability of the grid for any
reason not caused by Supplier. The failure to provide Interconnection Facilities


 


I-6

















 


that are energized and
operational in a manner that will permit the transmission and sale of power
from a Turbine and related Electrical Infrastructure shall be deemed an
Operating Force Majeure Event with respect to such Turbine until such time as
the Interconnection Facilities are provided and sufficiently operational with
respect to each such Turbine.


 


“Operator” shall
mean the person or entity hired by Project Manager to operate the Project
pursuant to the OMS Agreement.


 


“Party” and “Parties”
has the meaning given in the Preamble to the Supply Agreement.


 


“Permit” means any
valid waiver, exemption, variance, franchise, permit, authorization, license or
similar order, of or from any federal, state, county, municipal, local,
regional, or other governmental body, instrumentality, agency, authority, court
or other body having jurisdiction over the matter in question.


 


“Power Curve”
means the energy values produced by the Turbines at the various wind speed
bands set forth in Exhibit C-2 of the Warranty Agreement.


 


“Power Curve
Warranty Buydown” means any payment made pursuant to Section 3.3(c) of
the Warranty Agreement.


 


“Progress Payment”
shall have the meaning given in Section 3.3 of the Supply
Agreement.


 


“Project” has the
meaning given in the Recitals of the Supply Agreement.


 


“Project
Completion” shall occur upon the Completion of the Turbines.


 


“Project
Completion Certificate” shall mean a certificate, in the form attached as Exhibit N
to the Supply Agreement, delivered by Supplier to Purchaser following
Completion of Commissioning of the Turbines.


 


“Project Site”
means the site described in Exhibit Q of the Supply Agreement.


 


“Proven Power
Curve Percentage” or “PPCP” shall have the meaning given in Exhibit B to
the Warranty Agreement.


 


“Prudent
Electrical Industry Practices” means those practices, methods, standards and
acts (including those engaged in or approved by a significant portion of the
power industry for similar facilities in the United States) that at a
particular time in the exercise of good judgment would have been expected to
comply with Governmental Requirements, and to promote safety, environmental
protection, economy and expedition.


 


“Prudent Wind
Industry Practices” means standards and practices that are widely accepted by
the wind energy industry for wind projects of this size and that are prudently
applied and reasonably anticipated and intended to maximize output and
productivity of the Turbines, consistent with their intended design lives.


 


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“PTC Benefits”
means the tax credits that Purchaser may be eligible to claim for the
production of renewable energy by the Project in accordance with Section 45
of the United States Internal Revenue Code, as in effect as of the date of this
Agreement.


 


“Purchaser”
includes the named Purchaser identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Purchaser Permits”
mean all Permits required in connection with the development, construction,
ownership and operation of the Project, other than the Supplier Permits.


 


“SCADA System”
means a supervisory control and data acquisition system, including a central
computer and related software, whether supplied and installed by Supplier or by
a third party, as more particularly described in the SCADA System
Specifications.


 


“SCADA System
Installation Manual” means the manual attached to the Supply Agreement as Exhibit V.


 


“SCADA System
Specifications” means those specifications set forth on Exhibit U
to the Supply Agreement, pertaining to the SCADA System.


 


“Services” shall
mean the Commissioning Work.


 


“Site Agreements”
means any agreement between Purchaser, Project Manager, Supplier or Operator,
and any third party, with respect to the operation or maintenance of the
Project.


 


“Subcontractors”
means such subcontractors, consultants or suppliers which in the Supplier’s
reasonable judgment may be necessary to complete Supplier’s duties and
obligations under the Supply Agreement.


 


“Supplier”
includes the named Supplier identified in the Preamble to the Supply Agreement
and its successors and permitted assigns.


 


“Supplier Permits”
means the Supplier Permits listed on Exhibit R to the Supply
Agreement.


 


“Supply Agreement”
means the Turbine Supply Agreement dated as of December 31, 2007 by and
between Supplier and Purchaser and any amendments thereto.


 


“Supply Items”
means, collectively, the Major Turbine Components and Ancillary Parts and
Equipment.


 


“Supply
Obligations” means Supplier’s obligations under the Supply Agreement to (i) supply
Purchaser the Supply Items and (ii) provide Purchaser certain services in
connection with the Supply Items, including (a) supplying, packing,
shipping and Delivering all Supply Items to their Designated Delivery
Locations; (b) at Purchaser’s request, providing a technical adviser to be
present at the Project Site during Turbine Installation; and (c) performing
the Commissioning Work.


 


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*****


 


“Testing Engineer”
means Garrad Hassan Germanischer Lloyd, the National Renewable Energy
Laboratory, or Global Energy Concepts, or such other independent engineer as
mutually agreed.


 


“Tower” means each
77.4 meter steel tubular tower component of a Turbine having a hub height of
approximately eighty meters (80 m) (measured from the base of such tower to the
center of the Turbine hub) upon which a Turbine Nacelle shall be mounted,
including all ladders, platforms, internal lighting, safety equipment, and all
parts and assemblies necessary for a complete turbine tower, all as further
described in the Turbine Specifications.


 


“Tower Foundation
Requirements” means Supplier’s requirements for the foundation upon which the
Towers are to be erected (which shall specify foundation loads, bolt
configuration, cable configuration and grounding requirements).


 


“Transferee
Agreement and Acknowledgement” means the Agreement and Acknowledgement executed
by Owner and delivered to Supplier in the form attached hereto as Exhibit K
to this Agreement.


 


“Transmission
Facilities” mean the underground and/or overhead distribution, collection and
transmission lines; underground and/or overhead control, communications and
radio relay systems and telecommunications equipment; energy storage
facilities; interconnection and/or switching facilities, circuit breakers,
transformers; cables, wires, fiber, conduit, footings, foundations, towers,
poles, crossarms, guy lines and anchors, and any related or associated
improvements, fixtures, facilities, appliances, machinery and equipment.


 


“Turbine” has the
meaning given in the Recitals to the Supply Agreement.


 


“Turbine Blade”
means a turbine blade component of a Turbine (each Turbine shall have three (3) Turbine
Blades).


 


“Turbine Component
Storage Requirements” means Supplier’s standard requirements for storage and
maintenance of Turbine Components pending installation.


 


“Turbine
Controller” means the circuit breaker and controller equipment for each Turbine
as further described in the Turbine Specifications.


 


“Turbine
Installation Manual” means Supplier’s detailed manual for the Installation
Work.


 


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“Turbine Nacelle”
means the turbine nacelle component of a Turbine, including gearbox,
generators, blade pitch controls, brakes, hydraulic systems, lightning
protection system, and nacelle yaw controls, and associated control and
ancillary equipment.


 


“Turbine Specifications”
means those specifications set forth in Exhibit S to the Supply
Agreement pertaining to the Turbines.


 


“Turbine Supply
Documents” means, collectively, the Supply Agreement, the Warranty Agreement,
the OMS Agreement and all other agreements, documents or other instrument
executed and delivered by the Parties hereto in connection with the supply,
installation (if applicable) and maintenance of the Turbines.


 


“Warranted Power
Curve Percentage” or “WPCP” has the meaning given in Exhibit B to
the Warranty Agreement.


 


“Warranties” means
the Standard Warranty, the Availability Warranty, the Power Curve Warranty, the
Sound Warranty, and the IP Warranty given hereunder.


 


“Warranty
Agreement” means that certain warranty agreement by and between Supplier and Purchaser
of even date herewith, pursuant to which Supplier makes certain covenants and
warranties to Purchaser with respect to the Major Turbine Components supplied
pursuant to this Agreement.


 


“Warranty Period
Year” means, for the Turbines, the period beginning on the earlier of (a) the
date of Project Completion or (b) six (6) months after the last Major
Turbine Component is Delivered to Purchaser, and ending exactly twelve (12)
months thereafter, and each of the following four (4) twelve (12) month periods
thereafter; provided, however that the last of such periods shall not extend
beyond the end of the Warranty Period.


 


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