Document:

Exhibit 10.2

 

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

 

AMENDED AND RESTATED TURBINE SUPPLY
AGREEMENT

 

BY AND BETWEEN

 

UPC WIND ACQUISITION IV, 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

  	
  2

  
	
   

  	
   

  	
   

  
	
  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

  	
  4

  
	
  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

  	
  6

  
	
  4.1

  	
  Purchaser’s Obligations

  	
  6

  
	
  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

  	
  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

  	
  11

  
	
  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

  	
  20

  
	
  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

  	
  Surviving Obligations

  	
  23

  

 

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

  	
  26

  
	
   

  	
   

  	
   

  
	
  ARTICLE 16

  	
  GENERAL PROVISIONS

  	
  26

  
	
  16.1

  	
  Waiver

  	
  26

  
	
  16.2

  	
  Successors and Assigns

  	
  26

  
	
  16.3

  	
  Permitted Assignments

  	
  27

  
	
  16.4

  	
  Notices

  	
  28

  
	
  16.5

  	
  Governing Law

  	
  28

  
	
  16.6

  	
  Amendments

  	
  28

  
	
  16.7

  	
  Attachments Incorporated

  	
  29

  
	
  16.8

  	
  Entire Agreement

  	
  29

  
	
  16.9

  	
  Confidentiality

  	
  29

  
	
  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

  	
   

  	
  [Intentionally Left Blank]

  
	
  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

 

AMENDED AND RESTATED TURBINE SUPPLY AGREEMENT

 

THIS AMENDED AND
RESTATED 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 IV, 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, the
Parties entered into a Turbine Supply Agreement dated as October 18, 2006
pursuant to which Supplier was to sell and Purchaser was to purchase eighty
(80) Clipper Windpower 2.5 MW “C-99” series wind turbines (the “Original
Agreement”).

 

WHEREAS, the
Parties have agreed to amend and restate the Original Agreement as provided
herein, and to enter into a separate Turbine Supply Agreement for the purchase
and sale of sixteen (16) Clipper Windpower 2.5 MW “C-96” series wind turbines.

 

WHEREAS, Purchaser
desires to purchase, and Supplier desires to sell sixty four (64) 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 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

 

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.

 

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.

 

2

 

(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. 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 Sections 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.

 

3

 

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 Suppliers 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, 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”). On November 1, 2006 (the “Down Payment Date”), Purchaser paid to
Supplier a non-refundable amount equal to ***** percent (*****%) of the
Purchase Price (the “Down Payment”). Further, on November 5, 2007
Purchaser paid to Supplier an additional non-refundable amount equal to *****
percent (*****%) of the Purchase Price. 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 in 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”):

 

4

 

(a)       Purchaser shall pay 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 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.

 

           *****

 

5

 

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 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

 

6

 

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

 

(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

 

7

 

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.

 

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

 

8

 

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 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.

 

9

 

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 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

 

10

 

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 *****
days after delay payments become payable, 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

 

11

 

exceed
$***** per day or $***** per day (after ***** days of delay payments), 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.

 

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

 

12

 

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 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

 

13

 

 

(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; or (iv) 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

 

14

 

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; 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

 

15

 

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”).

 

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.

 

16

 

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.

 

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

 

17

 

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.

 

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’

 

18

 

Liability
Act and the Jones Act. Employers’ Liability insurance stall 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:

 

(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.

 

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

 

20

 

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:

 

(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

 

21

 

(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 Purchase 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

 

22

 

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 addition to those 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.
In the event of such *****.

 

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     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

 

23

 

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.

 

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

 

24

 

maintained
by the American Arbitration Association (the “AA A 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
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

 

25

 

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.

 

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

 

26

 

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, 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.

 

27

 

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 IV,
  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.

 

28

 

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).

 

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

 

29

 

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
  IV, LLC, 

  
	
   

  	
  a Delaware limited
  liability company

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Paul Gaynor

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Paul
  Gaynor

  
	
   

  	
   

  	
   

  
	
   

  	
  Title:

  	
  President

  

 

[Signature Page to Turbine

Supply Agreement]

 

HILFORD AMENDED

 

 

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 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 Amended and Restated 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) 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

 

EXHIBIT A

 

ANCILLARY PARTS AND
EQUIPMENT

 

A-1

 

Exhibit A

Ancillary Parts and
Equipment

 

Power Distribution Panel 

Field Kit 

Service Lifts 

Converter Platforms 

Stairs 

Converters

 

 

EXHIBIT B

 

PAYMENT SCHEDULE

 

B-1

 

EXHIBIT B1 

PRICE

 

	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
  $

  	
  *****

  	
   

  	
  Per turbine subtotal

  	
   

  
	
  *****

  	
   

  	
  Turbines

  	
   

  
	
  $

  	
  *****

  	
   

  	
  Subtotal

  	
   

  
	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
  $

  	
  *****

  	
   

  	
  Purchase Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  $

  	
  *****

  	
   

  	
  Purchase Price per Turbine

  	
   

  

 

 

 

EXHIBIT B2

PAYMENT SCHEDULE

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  # of
  Turbines

  	
   

  	
  Purchase
  Price

  (thousands)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  64

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
															

 

	
  Milestone

  	
   

  	
  Approximate

  Months prior to

  Delivery of first

  Major Turbine

  Component

  	
   

  	
  Payment
  Due Date

  	
   

  	
  % of

  Purchase

  Price

  	
   

  	
  Cumulative
  %

  of Purchase

  Price

  	
   

  	
  Payment
  Amount

  (thousands)

  	
   

  	
  Notes

  	
   

  
	
  Down
  Payment

  	
   

  	
   

  	
   

  	
  already
  paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  Purchaser paid on November
  1, 2006 (the “Down Payment Due”)

  	
   

  
	
  Progress
  Payment #1

  	
   

  	
   

  	
   

  	
  already
  paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  Purchaser paid on November
  5, 2007

  	
   

  
	
  Progress
  Payment #2

  	
   

  	
  6

  	
   

  	
  March 14,
  2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
   

  	
   

  
	
  Progress
  Payment #3 *****

  	
   

  	
   

  	
   

  	
  September 12,
  2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

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

  	
   

  
	
  Progress
  Payment #4 *****

  	
   

  	
   

  	
   

  	
  November 14,
  2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

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

  	
   

  
	
  Progress
  Payment #5 *****

  	
   

  	
   

  	
   

  	
  December 12,
  2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

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

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

Notes

*****

*****

*****

*****

*****

 

 

 

EXHIBIT
C

SPARE PARTS

 

Spare parts list to be provided by Supplier three (3) months
prior to the scheduled date of Delivery of the first Major Turbine Component.

 

 

EXHIBIT I

 

SUPPLIER ACCOUNT

 

I-1

 

EXHIBIT I

SUPPLIER ACCOUNT

 

	
  BANK NAME

  	
   

  	
  Pacific Capital BankCorp
  (Santa Barbara Bank &  Trust)

  
	
  BANK ADDRESS

  	
   

  	
  5420 Carpinteria Avenue

  
	
   

  	
   

  	
  Carpinteria, CA 93013

  
	
  BANK CONTACT

  	
   

  	
  Tammie Kunisawa

  
	
   

  	
   

  	
  (805) 566-3321

  
	
  ABA NUMBER

  	
   

  	
  122220593 (Domestic
  transfers)

  
	
  SWIFT CODE

  	
   

  	
  SBBTUS66XXX (International
  transfers)

  
	
  FOR CREDIT TO

  	
   

  	
  Clipper Turbine
  Works, Inc.

  
	
  ACCOUNT NUMBER

  	
   

  	
  05131-297

  
	
  CLIPPER CONTACT

  	
   

  	
  Garry Pealer, Treasurer

  
	
   

  	
   

  	
  (805) 690-3288

  

 

 

Exhibit J

 

Amended and Restated Guaranty

 

This AMENDED AND RESTATED
GUARANTY (this “Guaranty”) is made as of February 15, 2008 , by UPC WIND
PARTNERS, LLC, a Delaware limited liability company having a primary place of
business at c/o UPC Wind Management, LLC, 85 Wells Avenue, Suite 305,
Newton, MA 02459 (“Guarantor”), and CLIPPER TURBINE WORKS, INC., a Delaware
corporation having a primary place of business at 6305 Carpinteria A venue,
Carpinteria, California 93103 (“Seller”). Guarantor and Seller are referred to
herein collectively as the “Parties” and individually as a “Party”. Unless
otherwise defined in this Guaranty, all capitalized terms used in this Guaranty
shall have the meanings ascribed thereto in the Contract (as defined below).

 

RECITALS:

 

WHEREAS,
Guarantor and Seller entered into a Guaranty dated as of November 1,
2006 (the “Original Guaranty”) pursuant to which Guarantor guaranteed the
obligations of UPC Wind Acquisition IV, LLC (“Buyer”) under a Turbine Supply
Agreement providing for the purchase by Buyer of eighty (80) wind turbines;

 

WHEREAS,
the Parties have agreed to amend and restate the Original
Guaranty as provided herein, and to enter into a separate guaranty providing
for the guaranty of Buyer’s obligations under a Turbine Supply Agreement
providing for the purchase by Buyer of sixteen (16) wind turbines;

 

WHEREAS,
Buyer and Seller entered into that certain Amended and
Restated Turbine Supply Agreement dated as of December 31, 2007 (the “Contract”),
for the delivery of sixty four (64) wind turbines, ancillary equipment and
certain related services;

 

WHEREAS,
Guarantor is the owner of all the membership interests of
Buyer and Guarantor is willing to enter into this Guaranty to satisfy Buyer’s
obligation to deliver a Guaranty required pursuant to the Contract on the terms
and conditions set forth below; and

 

WHEREAS,
Seller is willing to accept this Guaranty in satisfaction of
Buyer’s obligation to deliver a Guaranty required pursuant to the Contract on
the terms and conditions set forth below.

 

NOW,
THEREFORE, in consideration of the premises and mutual
covenants set forth herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the Parties hereto
agree as follows:

 

Pursuant to the terms and
conditions of this Guaranty, Guarantor, as a primary obligor and not merely as
a surety, hereby unconditionally and irrevocably guarantees to Seller the
prompt payment in full of each Payment (as defined below). If (a) Buyer
receives from Seller an invoice for a payment (each, a “Payment”) pursuant to
the Contract and; (b) Buyer fails to pay such Payment to Seller in full
when due in accordance with the requirements of the Contract; and (c) Seller
makes written demand upon Guarantor for payment of the amount of such Payment
not so

 

1

 

paid by Buyer; Guarantor
hereby agrees that it shall pay, or cause to be paid, to Seller on or prior to
the date that is five (5) Business Days following Guarantor’s receipt of
such demand (such date, the “Last Payment Date”) the balance of such Payment
that has not been paid by Buyer to Seller. Guarantor shall have sufficient
funds to satisfy Guarantor’s obligations under this Guaranty. If Guarantor pays
to Seller any amount of such Payment due and payable pursuant to the terms and
conditions of this Guaranty, Buyer’s payment obligations with respect to such
Payment arising under the Contract (such obligations, the “Obligations”) shall
be deemed satisfied to the extent of the amount of any such payment, and Buyer
shall have no further obligations to Seller pursuant to the Contract with
respect to the payment of such amount of such Payment. All payments made by
Guarantor pursuant to this Guaranty shall be made without any deduction,
offset, counterclaim or setoff of any kind. All existing and future
indebtedness of, or other obligations owed by, Buyer to Guarantor is hereby
subordinated to all obligations of Buyer to Seller under the Contract.
Guarantor hereby unconditionally and irrevocably waives and relinquishes, to
the maximum extent permitted by applicable law, all rights and remedies
accorded to sureties or guarantors and agrees not to assert or take advantage
of such rights or remedies.

 

2.        Seller acknowledges and agrees that the
current maximum amount of all Payments that may be payable under the Contract
(which may only be increased pursuant to a Change Order) (and the maximum
amount of Guarantor’s obligations in connection with and/or arising under this
Guaranty) is equal to ***** Dollars ($*****).

 

3.        This Guaranty shall terminate and be of
no further effect upon the earliest of (a) payment in full of the
Obligations under the Contract; and (b) the mutual agreement of Guarantor
and Seller.

 

4.        This Guaranty shall be binding upon, and
shall inure to the benefit of, the Parties hereto and their respective
successors and permitted assigns; provided, however, that neither Party may
pledge, assign or otherwise transfer any of its rights or obligations under this
Guaranty without the prior written consent of the other Party, and any such
attempted pledge, assignment or transfer shall be null and void ab initio.

 

5.        THIS GUARANTY SHALL BE GOVERNED BY, AND
CONSTRUED IN  ACCORDANCE WITH, THE LAWS
OF THE STATE OF NEW YORK, UNITED STATES OF AMERICA, WITHOUT REGARD TO THE
CONFLICT OF LAWS PROVISIONS THEREOF (OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).

 

[Signature Page Follows]

 

2

 

IN WITNESS
WHEREOF, the Parties hereto have caused this Guaranty to be executed by their
respective authorized representatives as of the date first written above.

 

	
  UPC WIND PARTNERS, LLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By: 

  	
  /s/ Paul Gaynor

  	
   

  
	
  Name:  

  	
  Paul Gaynor

  	
   

  
	
  Title:  

  	
  President & CEO

  	
   

  

 

	
  CLIPPER TURBINE WORKS, INC.

  	
   

  
	
   

  	
   

  
	
  By:   

  	
  /s/ Robert Gates

  	
   

  
	
  Name:  

  	
  Robert Gates

  	
   

  
	
  Title:  

  	
  Sr. V.P.

  	
   

  

 

3

 

EXHIBIT K

 

TRANSFEREE AGREEMENT AND ACKNOWLEDGMENT

 

THIS AGREEMENT AND
ACKNOWLEDGEMENT BY WIND TURBINE OWNER (“AGREEMENT”) is made and delivered as of
                                                        , 20     by
                                                        ,
a
                                                        
(“Owner”) in favor of Clipper Turbine Works, Inc., a Delaware corporation
(“Supplier”), with reference to the following facts:

 

A.                    Owner owns,
leases or is acquiring by purchase or lease
                    model
                     wind turbines (the “Turbines”) that
were originally designed and supplied by Supplier under that certain Turbine
Supply Agreement (the “Supply Agreement”), dated
                                , 200    , between
Supplier and
                                                        
(“Purchaser”). Capitalized terms used herein but not otherwise defined herein
shall have the meanings assigned to such terms in the Supply Agreement.

 

B.                      The Supply
Agreement restricts the resale, lease or other transfer of the Turbines unless
an agreement and acknowledgement in the form of this Agreement is executed and
delivered to Supplier by the proposed transferee.

 

C.                      Owner
desires to execute and deliver this Agreement to Supplier to satisfy the
above-described restriction on the transfer of the Turbines.

 

NOW, THEREFORE, in
consideration of the foregoing premises and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, Owner
hereby agrees and acknowledges as follows:

 

1.         Acknowledgement re: Intellectual
Property Rights.

 

(a) Patents.
Owner acknowledges that: (i) Supplier’s
patent rights are merely licensed to the Purchaser and, through Owner’s
acquisition of the Turbines, are merely being licensed to Owner solely for use
in connection with the operation of the Turbines; (ii) 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; (iii) other than the rights granted to the
Purchaser, under the Supply Agreement, and to Owner, through Owner’s
acquisition of the Turbines, with respect to the Supply Items, Supplier
expressly reserves all other patent rights; and (iv) neither Purchaser nor
Owner 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.

 

(b) Trade
Secrets. Owner acknowledges that: (i) the technical, operational and
maintenance, and other information it has or may receive 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

 

K-1

 

to Supplier; (ii) Supplier’s
trade secret rights are merely licensed to Purchaser and, through Owner’s
acquisition of the Turbines, are merely being licensed to Owner solely for the
installation and operation and maintenance of the Supply Items: (iii) Supplier
granted to Purchaser, under the Supply Agreement, and to Owner, through Owner’s
acquisition of the Turbines, under Supplier’s trade secret rights, the
non-exclusive right to disclose such trade secrets 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
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; (iv) other than the rights granted to the Purchaser, under
the Supply Agreement, and to Owner, through Owner’s acquisition of the
Turbines, with respect to the Supply Items, Supplier expressly reserves all
other trade secret rights; (v) Owner shall 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 (iii) above.

 

(c) Copyrights.
Owner acknowledges that: (i) the technical, operation and maintenance, and
other information it has or may receive 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; (ii) Supplier’s copyrights are merely
licensed to Purchaser and, through Owner’s acquisition of the Turbines, are
merely being licensed to Owner solely for the installation and operation and
maintenance of the Supply Items; (iii) Supplier granted to Purchaser,
under the Supply Agreement, and to Owner, through Owner’s acquisition of the
Turbines, 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; (iv) other than the rights granted to the Purchaser, under the
Supply Agreement, and to Owner, through Owner’s acquisition of the Turbines,
with respect to the Supply Items, Supplier expressly reserves all other
copyright rights; (v) Owner 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; and (vi) Owner shall not reverse engineer,
disassemble or decompile any of the copyrightable materials.

 

(d) Trademarks
and Service Marks. Owner acknowledges that: (i) Owner shall not have
any rights in any trademarks or service marks, whether registered or not, that
are owned or controlled by Supplier; (ii) Owner shall not utilize any
trademark or service mark that is confusingly similar to any trademarks or
service marks owned or controlled by Supplier, but Owner 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.

 

2.         Transfer of Title in Supply Items.
Owner acknowledges that should Owner transfer title in any of the Supply Items
to a third party, the licenses provided in Section

 

K-2

 

4.5 of
the Supply Agreement and this Agreement shall run with such Supply Items;
provided that, such third party executes a written agreement 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 Section 4.5
of the Supply Agreement and this Agreement. Owner further 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.

 

3.         Ownership and Injunctive Relief.
Owner acknowledges that 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. Owner shall derive no rights, title or interest
therein except as expressly set forth in this Agreement. 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.         Government Rights. Owner
acknowledges that 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 Section 4.5 of the Supply Agreement.

 

5.         Access to Information. Owner
shall provide to Supplier prompt access to all technical, operational and
maintenance and other information it receives or collects in connection with
the Turbines.

 

6.         Confidentiality. All such
Intellectual Property Rights shall at all times remain the exclusive property
of Supplier. Owner agrees to maintain all information consisting of or
concerning the Intellectual Property Rights in confidence and not to use (other
than in collection with its ownership and use of the Turbine), or disclose
(other than in connection with its operation and maintenance of the Turbine) to
any person or entity, any of such information or Intellectual Property Rights
without the express written consent of Supplier. Owner acknowledges that
Supplier shall be entitled, in addition to its other rights and remedies, to
obtain injunctive relief upon any violation by Owner of this Agreement.

 

7.         Existing Agreements. In
acquiring the Turbines, Owner acknowledges that Supplier has performed its
obligations under the Turbine Supply Agreement with the Original Purchaser.
Owner has no rights thereunder, whether by assignment or otherwise. Any
obligations to Owner from Supplier or its affiliates respecting the Turbines exist
only pursuant to the Warranty Agreement and Operations, Maintenance and Service
Agreement between the

 

K-3

 

Original Purchaser and
Supplier or its affiliates, but only if Owner has expressly assumed, in writing,
the rights and obligations of the Original Purchaser thereunder.

 

8.         Tower Supply and Installation.
Owner acknowledges that Supplier supplied only the Supply Items and that the
foundations and all other elements of the wind project were supplied and
installed by others. Owner agrees that Supplier has no liability for (i) any
items it did not supply or services it did not render or (ii) for the
affect of any of such items or services on the Turbines.

 

IN WITNESS
WHEREOF, the undersigned Owner has executed this Agreement as of the date first
above written.

 

 

	
   

  	
  OWNER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

	
  ACCEPTED 

  	
   

  
	
   

  	
   

  
	
  CLIPPER TURBINE WORKS,
  INC. 

  	
   

  
	
  a Delaware corporation

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  

 

K-4

 

EXHIBIT L

 

DELIVERY SCHEDULE

 

L-1

 

EXHIBIT L

DELIVERY SCHEDULE

 

64 c99 Turbines

 

	
   

  	
   

  	
  2008

  	
   

  	
  2009

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  November

  	
   

  	
  December

  	
   

  	
  January

  	
   

  	
  February

  	
   

  	
   

  	
   

  
	
  Week Ending

  	
   

  	
  11/7/08

  	
   

  	
  11/14/08

  	
   

  	
  11/21/08

  	
   

  	
  11/28/08

  	
   

  	
  12/05/08

  	
   

  	
  12/12/08

  	
   

  	
  12/19/08

  	
   

  	
  12/26/08

  	
   

  	
  1/2/09

  	
   

  	
  1/9/09

  	
   

  	
  1/16/09

  	
   

  	
  1/23/09

  	
   

  	
  1/30/09

  	
   

  	
  2/6/09

  	
   

  	
  2/13/09

  	
   

  	
   

  	
   

  
	
  Fiscal Week

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  1

  	
   

  	
  2

  	
   

  	
  3

  	
   

  	
  4

  	
   

  	
  5

  	
   

  	
  6

  	
   

  	
  7

  	
   

  	
  Total

  	
   

  
	
  PDP, Field kits, Service Lifts

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  5

  	
   

  	
  5

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  2

  	
   

  	
  64

  	
   

  
	
  Converter Platforms, Converters, Stairs

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  5

  	
   

  	
  5

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  2

  	
   

  	
  64

  	
   

  
	
  Tower

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  5

  	
   

  	
  5

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  2

  	
   

  	
  64

  	
   

  
	
  Machine Base Assembly & Nacelle

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  5

  	
   

  	
  5

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  2

  	
   

  	
  64

  	
   

  
	
  Gearbox/Generator Assembly

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  5

  	
   

  	
  5

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  2

  	
   

  	
  64

  	
   

  
	
  Hub Assembly

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  5

  	
   

  	
  5

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  2

  	
   

  	
  64

  	
   

  
	
  Blade Sets

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  3

  	
   

  	
  5

  	
   

  	
  5

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  7

  	
   

  	
  2

  	
   

  	
  64

  	
   

  

 

 

 

EXHIBIT M1

 

TURBINE COMMISSIONING AND TURNOVER
CERTIFICATE

 

DATE OF ISSUANCE

 

OWNER:

 

CONTRACTOR:

 

	
  Agreement:

  	
   

  	
  (the “Agreement”)

  

 

Project:

 

Capitalized
terms used herein shall have the meaning set forth in the Agreement.

 

CONTRACTOR hereby
certifies that

 

(a) Mechanical Completion with respect to such WTG has occurred as
evidenced by Owner’s delivery to Contractor a countersigned Mechanical
Completion Certificate with respect thereto;

 

(b) Commissioning has been conducted and the WTG has met or
exceeded the requirements set forth in the Commissioning Test and Inspection
Procedures;

 

(c) all items of the Work necessary to achieve connection of such
WTG to the Electrical Infrastructure;

 

(d) all equipment and materials associated with such
fully-assembled WTG has been properly assembled, erected, installed, adjusted,
tested and commissioned, is mechanically, electrically and structurally
complete and sound as set forth in the Technical Specifications, and can be
used safely and operated continuously in accordance with the Contract
Documents, Applicable Laws and Applicable Standards; and

 

(e) Owner has accepted a Commissioning and Turnover Certificate
with respect to such fully-assembled WTG.

 

	
  Executed
  by Contractor on

  	
   

  	
   

  	
   

  
	
   

  	
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CONTRACTOR

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  (Authorized Signature)

  

 

OWNER concurs in
CONTRACTOR’s certification as set forth above and accepts this Form of
Turbine Commissioning and
Turnover Certificate.

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  OWNER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  (Authorized Signature)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
					

 

1

 

 

EXHIBIT M2

 

ARRAY
COMMISSIONING AND TURNOVER CERTIFICATE

 

DATE OF ISSUANCE

 

OWNER:

 

CONTRACTOR:

 

	
  Agreement:

  	
   

  	
  (the “Agreement”)

  

 

Project:

 

Capitalized
terms used herein shall have the meaning set forth in the Agreement.

 

CONTRACTOR hereby
certifies that

 

(a) Mechanical Completion with respect to such Array has occurred
as evidenced by Owner’s delivery to Contractor a countersigned Mechanical
Completion Certificate with respect thereto;

 

(b) Commissioning has been conducted and the Array has met or
exceeded the requirements set forth in the Commissioning Test and Inspection
Procedures;

 

(c) all items of the Work necessary to achieve connection of such
Array to the Electrical Infrastructure;

 

(d) all equipment and materials associated with such
fully-assembled Array has been properly assembled, erected, installed,
adjusted, tested and commissioned, is mechanically, electrically and
structurally complete and sound as set fourth in the Technical Specifications,
and can be used safely and operated continuously in accordance with the
Contract Documents, Applicable Laws and Applicable Standards; and

 

(e) Owner has accepted a Array Commissioning and Turnover
Certificate with respect to such fully-assembled Array.

 

	
  Executed
  by Contractor on

  	
   

  	
   

  	
   

  
	
   

  	
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CONTRACTOR

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  (Authorized Signature)

  

 

OWNER concurs in
CONTRACTOR’s certification as set forth above and accepts this Form of
Turbine Commissioning and
Turnover Certificate.

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  OWNER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  (Authorized Signature)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
					

 

1

 

EXHIBIT N

 

PROJECT COMPLETION CERTIFICATE

 

N-1

 

 

EXHIBIT N

 

PROJECT COMPLETION CERTIFICATE

 

DATE OF ISSUANCE

 

PURCHASER:

 

SUPPLIER:

 

	
  Agreement:

  	
   

  	
  (the “Agreement”)

  

 

Project:

 

Capitalized terms used
herein shall have the meaning set forth in the Agreement.

 

PURCHASER hereby
certifies that:

 

(a) SUPPLIER has received from Purchaser a Installation Completion
Notice evidencing that the Installation Work has been completed on all Turbines
in the Project;

 

(b) Commissioning has been conducted and all Turbines in the
Project have met or exceeded the requirements set forth in the Commissioning
and Start-Up Procedures;

 

(c) all of the Turbines in the Project have achieved connection to
the Electrical Infrastructure; and

 

(d) all equipment and materials associated with the
fully-assembled Turbines in the Project have been properly adjusted, tested and
commissioned in conformance with the Turbine Specifications.

 

	
  Executed
  by SUPPLIER on

  	
   

  	
   

  	
   

  
	
   

  	
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SUPPLIER

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  (Authorized Signature)

  

 

PURCHASER concurs in
SUPPLIER’s certification as set forth above and accepts this Project Completion
Certificate.

 

	
   

  	
   

  	
   

  
	
   

  	
   

  	
  PURCHASER

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  (Authorized Signature)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
					

 

1

 

EXHIBIT Q

 

PROJECT SITE

 

Q-1

 

EXHIBIT Q
 PROJECT SITE

 

To be provided by Purchaser twelve (12) months
prior to the date of Delivery of

the first Major Turbine Component.

 

 

EXHIBIT R

 

SUPPLIER PERMITS

 

NONE

 

R-1

 

EXHIBIT T

 

COMPLETION
SCHEDULE

 

V-1

 

EXHIBIT T

COMPLETION
SCHEDULE

 

To be mutually agreed upon by Purchaser and Supplier by March 14,
2007.Exhibit 10.4

 

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.

 

AMENDMENT
NO. 2

 

TO

 

AMENDED AND
RESTATED TURBINE SUPPLY AGREEMENT

 

and

 

AMENDED AND
RESTATED WARRANTY AGREEMENT

 

This
AMENDMENT NO. 2 TO AMENDED AND RESTATED TURBINE SUPPLY AGREEMENT and AMENDED
AND RESTATED WARRANTY AGREEMENT (the “Amendment”) is entered into and effective
as of April 22, 2009, by and between CLIPPER TURBINE WORKS, INC., a
Delaware corporation (“Supplier”), and FIRST WIND ACQUISITION IV, LLC, a
Delaware limited liability company, with a place of business c/o First Wind
Energy, LLC, 85 Wells Ave., Suite 305, Newton, MA 02459 (“Purchaser”).

 

RECITALS

 

A.  Purchaser and Supplier are parties to an Amended and Restated
Turbine Supply Agreement dated as of December 31, 2007 (as amended from
time to time, the “Turbine Supply Agreement”).

 

B.   Purchaser and Supplier are parties to an Amended and Restated
Warranty Agreement dated as of December 31, 2007 (as amended from time to
time, the “Warranty Agreement”, and together with the Turbine Supply Agreement,
the “Milford Agreements”).

 

C.    At Purchaser’s request, Supplier has re-routed twenty two (22)
Towers it was obligated to deliver under the Turbine Supply Agreement to the
Port of San Diego from the original destination of the Port of Houston, making
it necessary to increase the Purchase Price by $*****.

 

D.    The parties hereto desire to amend the Milford Agreements, all on
the terms and subject to the conditions of this Amendment.

 

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

 

1.    Definitions.
Capitalized terms used but not defined in this Amendment shall have the
meanings assigned to such terms in the Turbine Supply Agreement.

 

2.    Agreements
and Amendments.

 

a.   Exhibits Bl and B2 to the Turbine Supply Agreement are hereby
deleted and replaced in full with the new Exhibits Bl and B2 attached hereto on
Schedule I.

 

b.   Exhibit L to the Turbine Supply Agreement is hereby deleted
and replaced in full with the new Exhibit L attached hereto on Schedule
II.

 

c.   The Recitals to the Turbine Supply Agreement are hereby deleted in
their entirety and replaced in full as follows:

 

“WHEREAS, the Parties
entered into a Turbine Supply Agreement dated as of October 18, 2006
pursuant to which Supplier was to sell and Purchaser was to purchase eighty
(80) Clipper Windpower 2.5 MW “C-99” series wind turbines (the “Original
Agreement”).

 

WHEREAS, the Parties have
agreed to amend and restate the Original Agreement as provided herein, and to (i) enter
into a separate turbine supply agreement for the purchase and sale of sixteen
(16) Clipper Windpower 2.5 MW “C-96” series wind turbines and (ii) enter
into a separate turbine supply agreement for the purchase and sale of six (6) Clipper
Windpower 2.5 MW wind turbines.

 

WHEREAS, Purchaser desires
to purchase, and Supplier desires to sell fifty eight (58) 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 203.5 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:”

 

d.   Notwithstanding anything to the contrary in Section 6.11
of the Warranty Agreement or Section 2.1.2 (c) of the Turbine
Supply Agreement, the Parties hereby agree that, subject to completion of
applicable escrow documentation and the acceptance of such materials by the
Escrow Agent, within thirty (30) days of the date hereof, Supplier shall place
into escrow with the Escrow Agent, the ***** (as

 

 

defined
in the Warranty Agreement) and the Spare Parts Drawings (as defined in the
Turbine Supply Agreement).

 

e.   The first sentence of Section 3.1 of the Turbine
Supply Agreement is hereby deleted and replaced in full as follows:

 

“For the Supply Items, SCADA System and
Services, Purchaser shall pay to Supplier ***** ($*****) (the “Purchase
Price”).

 

f.    Section 3.5 of the Turbine Supply Agreement is hereby
amended by adding the following as the last sentence thereto:

 

“Upon Purchaser providing
written confirmation from the agent to the Lenders ***** for the Project, the
Parties agree that the Guaranty shall terminate and Supplier agrees to execute
and deliver to Purchaser such other instruments and agreements and take such
other action as Purchaser may reasonably request so as to more effectively
evidence the termination of the Guaranty.”

 

g.   The second Recital in the Warranty Agreement is hereby deleted and
replaced in full as follows:

 

“WHEREAS, the Parties have
agreed to amend and restate the Original Agreement to provide warranty support
for a fifty eight (58) wind turbine project as provided herein, and to (i) enter
into a separate warranty agreement to provide warranty support for another
sixteen (16) wind turbine project and (ii) enter into a separate warranty
agreement to provide warranty support for an additional six (6) wind
turbines.”

 

h.   Each Milford Agreement is hereby amended and modified as follows:

 

All references to “sixty
four (64)” wind turbines in each of the Milford Agreements are hereby deleted
and replaced in each instance with a reference to “fifty eight (58)” wind
turbines, including, without limitation, the references to such terms in all
exhibits, appendices or schedules to each of the Milford Agreements.

 

3.    Miscellaneous.

 

(a)    Each Milford Agreement as hereby amended remains in full force
and effect.

 

(b)    The terms and provisions of this Amendment shall be governed by
and construed in accordance with the laws of the State of New York, without
regard to conflicts of law principles.

 

 

(b)    This Amendment may be executed by the Parties in one or more
counterparts, all of which taken together, shall constitute one and the same
instrument.

 

[Signature page follows]

 

 

IN WITNESS WHEREOF, this Amendment 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 President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  FIRST WIND ACQUISITION IV, LLC,

  	
   

  
	
  a
  Delaware limited liability company

  	
   

  
	
   

  	
   

  
	
  By:

  	
  /s/ Evelyn Lim

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  

 

 

Schedule I

 

Exhibit B1 (Price) and

Exhibit B2 (Payment Schedule)

 

(attached)

 

 

EXHIBIT B1

PRICING  

 

Amendment 2 Milford TSA Pricing (58 WTG)

 

	
   

  	
  Milford, UT Pricing

  	
   

  

 

	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase
  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  $

  	
  *****

  	
   

  	
  Purchase
  Price per Turbine

  	
   

  

 

 

	
  Project and Turbine Size

  	
   

  	
  # of Turbines

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Purchase price

  (thousands)

  	
   

  	
  Notes

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Amendment 2 Milford TSA (58 WTG)

  	
   

  	
  58

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  
															

 

	
  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

  	
   

  	
   

  	
   

  	
  Already
  paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Progress Payment #1

  	
   

  	
   

  	
   

  	
  Already
  paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Progress Payment #2

  	
   

  	
  6

  	
   

  	
  Already
  paid

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Progress Payment #3 - *****

  	
   

  	
   

  	
   

  	
  December 30,
  2008

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Progress Payment #4

  	
   

  	
   

  	
   

  	
  April 17,
  2009

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Progress Payment #5 - *****

  	
   

  	
   

  	
   

  	
  July 26,
  2009

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  *****

  	
   

  	
   

  	
   

  	
  August 30,
  2009

  	
   

  	
  *****

  	
   

  	
  *****

  	
   

  	
  $

  	
  *****

  	
   

  	
  *****

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  Total

  	
   

  	
  *****

  	
   

  	
   

  	
   

  	
  $

  	
  *****

  	
   

  	
   

  	
   

  

 

 

 

Schedule II

 

Exhibit L

Delivery Schedule

(attached)

 

 

First
Wind - Milford Component Availability Schedule - 58
Turbines

 

	
   

  	
   

  	
   

  	
   

  	
  Oct-08

  	
   

  	
  November

  	
   

  	
  December

  	
   

  	
  January

  	
   

  
	
   

  	
   

  	
  Week #

  	
   

  	
  40

  	
   

  	
  41

  	
   

  	
  42

  	
   

  	
  43

  	
   

  	
  44

  	
   

  	
  45

  	
   

  	
  46

  	
   

  	
  47

  	
   

  	
  48

  	
   

  	
  49

  	
   

  	
  50

  	
   

  	
  51

  	
   

  	
  52

  	
   

  	
  1

  	
   

  	
  2

  	
   

  	
  3

  	
   

  	
  4

  	
   

  	
  5

  	
   

  
	
   

  	
   

  	
  Date

  	
   

  	
  9/29

  	
   

  	
  10/6

  	
   

  	
  10/13

  	
   

  	
  10/20

  	
   

  	
  10/27

  	
   

  	
  11/3

  	
   

  	
  11/10

  	
   

  	
  11/17

  	
   

  	
  11/24

  	
   

  	
  11/30

  	
   

  	
  12/7

  	
   

  	
  12/14

  	
   

  	
  12/21

  	
   

  	
  12/28

  	
   

  	
  1/4

  	
   

  	
  1/11

  	
   

  	
  1/18

  	
   

  	
  1/25

  	
   

  
	
  Blade US Arrival dates

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  2

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  7

  	
   

  	
   

  	
   

  	
  13

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  17

  	
   

  	
   

  	
   

  	
  22

  	
   

  
	
  Towers*                      *****

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  22

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ***** or *****

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Balance of Turbine**

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  6

  	
   

  	
  14

  	
   

  	
  22

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Blade sets are C99

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
   

  	
   

  	
  February

  	
   

  	
  March

  	
   

  	
  April

  	
   

  	
  May

  	
   

  
	
   

  	
   

  	
  Week #

  	
   

  	
  6

  	
   

  	
  7

  	
   

  	
  8

  	
   

  	
  9

  	
   

  	
  10

  	
   

  	
  11

  	
   

  	
  12

  	
   

  	
  13

  	
   

  	
  14

  	
   

  	
  15

  	
   

  	
  16

  	
   

  	
  17

  	
   

  	
  18

  	
   

  	
  19

  	
   

  	
  20

  	
   

  	
  21

  	
   

  	
  22

  	
   

  
	
   

  	
   

  	
  Date

  	
   

  	
  2/1

  	
   

  	
  2/8

  	
   

  	
  2/15

  	
   

  	
  2/22

  	
   

  	
  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

  	
   

  
	
  Blade US Arrival dates

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  25

  	
   

  	
  30

  	
   

  	
   

  	
   

  	
  32

  	
   

  	
   

  	
   

  	
  36

  	
   

  	
   

  	
   

  	
  39

  	
   

  	
   

  	
   

  	
  45

  	
   

  	
   

  	
   

  	
  51

  	
   

  	
  55

  	
   

  	
  58

  	
   

  
	
  Towers*                      *****

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ***** or *****

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  25

  	
   

  	
  30

  	
   

  	
   

  	
   

  	
  32

  	
   

  	
   

  	
   

  	
  36

  	
   

  	
   

  	
   

  	
  39

  	
   

  	
   

  	
   

  	
  45

  	
   

  	
   

  	
   

  	
  51

  	
   

  	
  55

  	
   

  	
  58

  	
   

  
	
  Balance of Turbine**

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  25

  	
   

  	
  30

  	
   

  	
   

  	
   

  	
  32

  	
   

  	
   

  	
   

  	
  36

  	
   

  	
   

  	
   

  	
  39

  	
   

  	
   

  	
   

  	
  45

  	
   

  	
   

  	
   

  	
  51

  	
   

  	
  55

  	
   

  	
  58

  	
   

  
	
  Blade sets are C99

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

*****

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00179-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00179-of-00352.parquet"}]]