Document:

Exhibit 10.2

 

MASTER SERVICES AGREEMENT

 

by and among

 

ZEPHYR RENEWABLES LLC

 

and

 

NRG YIELD, INC.,

 

NRG YIELD LLC

 

and

 

NRG YIELD OPERATING LLC

 

collectively, as Manager

 

Dated as of August 31, 2018

 

 

TABLE OF CONTENTS

 

	
ARTICLE 1 INTERPRETATION
    	
1
    
	
 
    	
 
    
	
 
    	
1.1
    	
Definitions
    	
1
    
	
 
    	
1.2
    	
Headings and Table of   Contents
    	
5
    
	
 
    	
1.3
    	
Interpretation
    	
5
    
	
 
    	
1.4
    	
Service Recipients   Third Party Beneficiaries
    	
6
    
	
 
    	
1.5
    	
Actions by the Manager   or the Service Recipients
    	
6
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 2 APPOINTMENT OF THE MANAGER
    	
7
    
	
 
    	
 
    
	
 
    	
2.1
    	
Appointment and   Acceptance
    	
7
    
	
 
    	
2.2
    	
Other Service   Recipients
    	
7
    
	
 
    	
2.3
    	
Subcontracting and   Other Arrangements
    	
7
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 3 SERVICES AND POWERS OF THE   MANAGER
    	
7
    
	
 
    	
 
    
	
 
    	
3.1
    	
Services
    	
7
    
	
 
    	
3.2
    	
Supervision of   Manager’s Activities
    	
7
    
	
 
    	
3.3
    	
Restrictions on the   Manager
    	
7
    
	
 
    	
3.4
    	
Errors and Omissions   Insurance
    	
8
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 4 RELATIONSHIP BETWEEN THE MANAGER   AND THE SERVICE RECIPIENTS
    	
8
    
	
 
    	
 
    
	
 
    	
4.1
    	
Other Activities
    	
8
    
	
 
    	
4.2
    	
Independent Contractor,   No Partnership or Joint Venture
    	
8
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 5 MANAGEMENT AND EMPLOYEES
    	
9
    
	
 
    	
 
    
	
 
    	
5.1
    	
Management and   Employees
    	
9
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 6 INFORMATION AND RECORDS
    	
9
    
	
 
    	
 
    
	
 
    	
6.1
    	
Books and Records
    	
9
    
	
 
    	
6.2
    	
Examination of Records   by the Service Recipients
    	
9
    
	
 
    	
6.3
    	
Access to Information   by Manager Group
    	
10
    
	
 
    	
6.4
    	
Additional Information
    	
10
    
	
 
    	
6.5
    	
Confidential   Information
    	
10
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 7 FEES AND EXPENSES
    	
11
    
	
 
    	
 
    
	
 
    	
7.1
    	
Annual Fee
    	
11
    
	
 
    	
7.2
    	
Computation and Payment   of Quarterly Annual Fee
    	
11
    
	
 
    	
7.3
    	
Governmental Charges
    	
12
    
	
 
    	
7.4
    	
Computation and Payment   of Governmental Charges
    	
12
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 8 REPRESENTATIONS AND WARRANTIES OF   THE MANAGER AND THE SERVICE RECIPIENTS
    	
12
    
	
 
    	
 
    
	
 
    	
8.1
    	
Representations and   Warranties of the Manager
    	
12
    
	
 
    	
8.2
    	
Representations and   Warranties of the Service Recipients
    	
13
    

 

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ARTICLE 9 LIABILITY AND INDEMNIFICATION
    	
14
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
9.1
    	
Indemnity
    	
14
    
	
 
    	
9.2
    	
Limitation of Liability
    	
15
    
	
 
    	
9.3
    	
Benefit to all Manager   Indemnified Parties
    	
16
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 10 TERM AND TERMINATION
    	
16
    
	
 
    	
 
    
	
 
    	
10.1
    	
Term
    	
16
    
	
 
    	
10.2
    	
Termination by the   Service Recipients
    	
16
    
	
 
    	
10.3
    	
Termination by the   Manager
    	
17
    
	
 
    	
10.4
    	
Survival Upon   Termination
    	
17
    
	
 
    	
10.5
    	
Action Upon Termination
    	
17
    
	
 
    	
10.6
    	
Release of Money or   other Property Upon Written Request
    	
18
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 11 ARBITRATION
    	
19
    
	
 
    	
 
    
	
 
    	
11.1
    	
Dispute
    	
19
    
	
 
    	
11.2
    	
Arbitration
    	
19
    
	
 
    	
11.3
    	
Continued Performance
    	
20
    
	
 
    	
11.4
    	
Urgent Relief
    	
20
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE 12 GENERAL PROVISIONS
    	
20
    
	
 
    	
 
    
	
 
    	
12.1
    	
Amendment, Waiver
    	
20
    
	
 
    	
12.2
    	
Assignment
    	
21
    
	
 
    	
12.3
    	
Failure to Pay When Due
    	
21
    
	
 
    	
12.4
    	
Invalidity of   Provisions
    	
21
    
	
 
    	
12.5
    	
Entire Agreement
    	
22
    
	
 
    	
12.6
    	
Mutual Waiver of Jury   Trial
    	
22
    
	
 
    	
12.7
    	
Consent to Jurisdiction
    	
22
    
	
 
    	
12.8
    	
Governing Law
    	
22
    
	
 
    	
12.9
    	
Enurement
    	
23
    
	
 
    	
12.10
    	
Notices
    	
23
    
	
 
    	
12.11
    	
Further Assurances
    	
24
    
	
 
    	
12.12
    	
Counterparts
    	
24
    

 

Appendices

Appendix A        Services

 

ii

 

MASTER SERVICES AGREEMENT

 

This MASTER SERVICES AGREEMENT is made as of August 31, 2018 (the “Effective Date”), by and among Zephyr Renewables LLC, a Delaware limited liability company (“Zephyr”), and NRG Yield, Inc., a Delaware corporation (“NYLD”), NRG Yield LLC, a Delaware limited liability company (“NYLD LLC”), and NRG Yield Operating LLC, a Delaware limited liability company (“NYLD Op” and together with NYLD and NYLD LLC, the “Manager”). Each of Zephyr and Manager is referred to herein as a “Party”, and together as the “Parties”.

 

RECITALS

 

A.            Zephyr directly and indirectly, as applicable, holds interests in the Service Recipients (as defined below).

 

B.            Zephyr wishes to engage the Manager to provide or arrange for other Service Providers (as defined below) to provide the services set forth in this Agreement to the Service Recipients, subject to the terms and conditions of this Agreement, and the Manager wishes to accept such engagement.

 

C.            Zephyr and Manager have also entered into a Master Services Agreement, dated as of August 31, 2018 (the “Corresponding MSA”), pursuant to which Zephyr has agreed to provide, or cause to be provided, services to Manager on the terms and conditions set forth therein.

 

NOW THEREFORE in consideration of the mutual representations, warranties, covenants and agreements contained in this Agreement and other good and valuable consideration (the receipt and sufficiency of which are hereby acknowledged), the Parties agree as follows:

 

ARTICLE 1
 INTERPRETATION

 

1.1          Definitions

 

In this Agreement, except where the context otherwise requires, the following terms will have the following meanings:

 

“AAA” has the meaning assigned thereto in Section 11.2.1.

 

“Acquired Assets” means any renewable infrastructure asset acquired after the date hereof by any member of the Zephyr Group.

 

“Affiliate” means with respect to any Person, any other Person that, directly or indirectly, through one or more intermediaries, Controls or is Controlled by, or is in common Control with, such Person.

 

“Agreement” means this Master Services Agreement, and “herein,” “hereof,” “hereby,”

 

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“hereunder” and similar expressions refer to this Agreement and include every instrument supplemental or ancillary to this Agreement and, except where the context otherwise requires, not to any particular article or section thereof.

 

“Annual Fee” means the Management Group’s Cost of providing the Services for any calendar year; provided, that the Annual Fee for the first full calendar year following the Effective Date shall not exceed the amount set forth on Appendix A under the heading of “Effective Date Cost” or “Post-Transition Cost”, as applicable. The Annual Fee may be increased or decreased from time to time by an agreed upon amount resulting from the amendment of the scope of the Services pursuant to Section 12.1.1.

 

“Arbitration” has the meaning assigned thereto in Section 11.2.1.

 

“Arbitrators” has the meaning assigned thereto in Section 11.2.4.

 

“Board of Directors” means the Board of Directors of Zephyr.

 

“Business” means the business carried on from time to time by the Zephyr Group.

 

“Business Day” means every day except a Saturday or Sunday, or a legal holiday in the City of New York on which banking institutions are authorized or required by law, regulation or executive order to close.

 

“Claims” has the meaning assigned thereto in Section 9.1.1.

 

“Control” or “control” (including the terms “controlled by” and “under common control with”), with respect to the relationship between or among two or more Persons, means the possession, directly or indirectly, of the power to direct or cause the direction of the affairs or management of a Person, whether through the ownership of voting securities, by contract or otherwise.

 

“Corresponding MSA” has the meaning assigned thereto in the recitals.

 

“Costs” means all costs and expenses incurred by the Manager Group in connection with the provision of the Services. Without limiting the generality of the foregoing, Costs are expected to include, among other things: (a) fees, costs and expenses incurred in connection the calculation and payment of taxes and the preparation and filing of tax returns; (b) fees, costs and expenses in connection with the procurement and allocation of insurance; (c) fees, costs and expenses incurred in connection with acquisition of information technology assets and implementation of information technology systems; and (d) any other fees, costs and expenses incurred by the relevant member of the Manager Group that are reasonably necessary for the performance by the relevant member of the Manager Group of its duties and functions under this Agreement.

 

“Dispute” has the meaning assigned thereto in Section 11.1.

 

“Effective Date” has the meaning assigned thereto in the preamble.

 

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“Expense Statement” has the meaning assigned thereto in Section 7.4.

 

“GAAP” means generally accepted accounting principles in the United States used by Zephyr in preparing its financial statements from time to time.

 

“Governing Body” means (i) with respect to a corporation, the board of directors of such corporation, (ii) with respect to a limited liability company, the manager(s) or managing member(s) of such limited liability company, (iii) with respect to a limited partnership, the board, committee or other body of the general partner of such partnership that serves a similar function or the general partner itself (or if any such general partner is itself a limited partnership, the board, committee or other body of such general partner’s general partner that serves a similar function or such general partner’s partner) and (iv) with respect to any other Person, the body of such Person that serves a similar function, and in the case of each of (i) through (iv) includes any committee or other subdivision of such body and any Person to whom such body has delegated any power or authority, including any officer and managing director.

 

“Governing Instruments” means (i) the certificate of incorporation and bylaws in the case of a corporation, (ii) the articles of formation and operating agreement in the case of a limited liability company (iii) the partnership agreement in the case of a partnership, and (iv) any other similar governing document under which an entity was organized, formed or created and/or operates.

 

“Governmental Authority” means any (i) international, national, multinational, federal, state, regional, municipal, local or other government, governmental or public department, central bank, court, tribunal, arbitral body, commission, board, bureau, agency or instrumentality, domestic or foreign, including ISO/RTOs, (ii) self-regulatory organization or stock exchange, (iii) subdivision, agent, commission, board, or authority of any of the foregoing, or (iv) quasi-governmental or private body exercising any regulatory, expropriation or taxing authority under or for the account of any of the foregoing.

 

“Governmental Charges” has the meaning assigned thereto in Section 7.3.

 

“Indemnifying Party” means a Person against whom a claim for indemnification is asserted pursuant to Article 9.

 

“Interest Rate” means, for any day, the rate of interest equal to the (a) overnight U.S. dollar London interbank offered rate on such day, and if such rate is unavailable, (b) the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published for such day by the Federal Reserve Bank of New York.

 

“ISO/RTO” means an independent electricity system operator, a regional transmission organization, national system operator or any other similar organization overseeing the transmission of energy in any jurisdiction in which the Zephyr Group owns assets or operates.

 

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“Laws” means any and all applicable (i) laws, constitutions, treaties, statutes, codes, ordinances, principles of common law and equity, rules, regulations and municipal bylaws whether domestic, foreign or international, (ii) judicial, arbitral, administrative, ministerial, departmental and regulatory judgments, orders, writs, injunctions, decisions, and awards of any Governmental Authority, and (iii) policies, practices and guidelines of any Governmental Authority which, although not actually having the force of law, are considered by such Governmental Authority as requiring compliance as if having the force of law, and the term “applicable,” with respect to such Laws and in the context that refers to one or more Persons, means such Laws that apply to such Person or Persons or its or their business, undertaking, property or securities at the relevant time and that emanate from a Governmental Authority having jurisdiction over the Person or Persons or its or their business, undertaking, property or securities.

 

“Liabilities” has the meaning assigned thereto in Section 9.1.1.

 

“Manager Group” means the Manager and its direct and indirect Subsidiaries (other than any member of the Zephyr Group).

 

“Manager Indemnified Parties” has the meaning assigned thereto in Section 9.1.1.

 

“Manager” has the meaning assigned thereto in the preamble.

 

“NYLD” has the meaning assigned thereto in the preamble.

 

“NYLD LLC” has the meaning assigned thereto in the preamble.

 

“NYLD Op” has the meaning assigned thereto in the preamble.

 

“Operating and Administrative Agreements” means the operating and administrative agreements in effect as of the Effective Date between certain members of the Zephyr Group and Affiliates of the Manager for such Zephyr Group members’ operating and administrative needs and, with respect to any Acquired Assets any operating and administrative agreements between any of the Acquired Assets and Affiliates of the Manager for such asset’s operating and administrative needs in effect as of the date of acquisition of the Acquired Asset by a member of the Zephyr Group.

 

“Operational and Other Services” means any services provided by any member of the Manager Group to any member of the Zephyr Group, including financial advisory, operations and maintenance, marketing, agency, development, operating management and other services, including services provided under any Operating and Administrative Agreement.

 

“Party” has the meaning assigned thereto in the preamble.

 

“Permit” means any consent, license, approval, registration, permit or other authorization granted by any Governmental Authority.

 

“Person” means any natural person, partnership, limited partnership, limited liability

 

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partnership, joint venture, syndicate, sole proprietorship, company or corporation (with or without share capital), limited liability corporation, unlimited liability company, joint stock company, unincorporated association, trust, trustee, executor, administrator or other legal personal representative, regulatory body or agency, government or Governmental Authority, authority or entity however designated or constituted and pronouns have a similarly extended meaning.

 

“Quarter” means a calendar quarter ending on the last day of March, June, September or December.

 

“Rules” has the meaning assigned thereto in Section 11.2.1.

 

“Service Providers” means the Manager, any member of the Manager Group and any other entity or individual that the Manager has arranged to provide the Services to any Service Recipient.

 

“Service Recipient” means Zephyr and their Subsidiaries as of the Effective Date, as well as any other direct and indirect Subsidiary of Zephyr acquired or formed after the date hereof that receives Services from a Service Provider pursuant to this Agreement.

 

“Services” has the meaning assigned thereto in Section 3.1.

 

“Subsidiary” means, with respect to any Person, (i) any other Person that is directly or indirectly Controlled by such Person, (ii) any trust in which such Person holds all of the beneficial interests or (iii) any partnership, limited liability company or similar entity in which such Person holds all of the interests other than the interests of any general partner, managing member or similar Person.

 

“Third Party Claim” has the meaning assigned thereto in Section 9.1.2.

 

“Transaction Fees” means fees paid or payable by the Service Recipients, which are on market terms, with respect to financial advisory services ordinarily carried out by investment banks in the context of mergers and acquisitions transactions.

 

“Zephyr” has the meaning assigned thereto in the preamble.

 

“Zephyr Group” means Zephyr and its direct and indirect Subsidiaries.

 

1.2          Headings and Table of Contents

 

The inclusion of headings and a table of contents in this Agreement are for convenience of reference only and will not affect the construction or interpretation hereof.

 

1.3          Interpretation

 

In this Agreement, unless the context otherwise requires:

 

1.3.1       words importing the singular shall include the plural and vice versa, words

 

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importing gender shall include all genders or the neuter, and words importing the neuter shall include all genders;

 

1.3.2       the words “include”, “includes”, “including”, or any variations thereof, when following any general term or statement, are not to be construed as limiting the general term or statement to the specific items or matters set forth or to similar items or matters, but rather as referring to all other items or matters that could reasonably fall within the broadest possible scope of the general term or statement;

 

1.3.3       references to any Person include such Person’s successors and permitted assigns;

 

1.3.4       any reference to a statute, regulation, policy, rule or instrument shall include, and shall be deemed to be a reference also to, all amendments made to such statute, regulation, policy, rule or instrument and to any statute, regulation, policy, rule or instrument that may be passed which has the effect of supplementing or superseding the statute, regulation, policy, rule or instrument so referred to;

 

1.3.5       any reference to this Agreement or any other agreement, document or instrument shall be construed as a reference to this Agreement or, as the case may be, such other agreement, document or instrument as the same may have been, or may from time to time be, amended, varied, replaced, amended and restated, supplemented or otherwise modified;

 

1.3.6       where a reference in this Agreement is made to a Section or Schedule, such reference shall be to a Section or Schedule to this Agreement unless otherwise indicated;

 

1.3.7       in the event that any day on which any amount is to be determined or any action is required to be taken hereunder is not a Business Day, then such amount shall be determined or such action shall be required to be taken at or before the requisite time on the next succeeding day that is a Business Day; and

 

1.3.8       except where otherwise expressly provided, all amounts in this Agreement are stated and shall be paid in U.S. currency.

 

1.4          Service Recipients Third Party Beneficiaries

 

The Manager agrees that each of the Service Recipients, including any Service Recipient formed or acquired after the Effective Date in accordance with Section 2.2, shall be, and is hereby, named as express third-party beneficiaries of this Agreement entitled to all the benefits conferred under this Agreement.

 

1.5          Actions by the Manager or the Service Recipients

 

Unless the context requires otherwise, where the consent of or a determination is required by the Manager or Service Recipient hereunder, the Parties shall be entitled to conclusively rely upon it having been given or taken, as applicable, if, the Manager or such Service Recipient, as applicable, has communicated the same in writing.

 

6

 

ARTICLE 2
 APPOINTMENT OF THE MANAGER

 

2.1          Appointment and Acceptance

 

2.1.1       Subject to and in accordance with the terms, conditions and limitations in this Agreement, Zephyr hereby appoints the Manager to provide or arrange for other Service Providers to provide the Services to the Service Recipients.

 

2.1.2       The Manager hereby accepts the appointment provided for in Section 2.1.1 and agrees to act in such capacity and to provide or arrange for other Service Providers to provide the Services to the Service Recipients upon the terms, conditions and limitations in this Agreement.

 

2.2          Other Service Recipients

 

The Parties acknowledge that any Subsidiary of Zephyr formed or acquired in the future that is not a Service Recipient on the date hereof may become a Service Recipient under this Agreement. In the event that any such addition results in an amendment of the scope of the Services, such amendment shall be effectuated as provided by Section 12.1.1.

 

2.3          Subcontracting and Other Arrangements

 

The Manager may subcontract to any other member of the Manager Group or any of its Affiliates, or arrange for the provision of any or all of the Services to be provided by it under this Agreement by any other member of the Manager Group or any of its Affiliates, and Zephyr hereby consents to any such subcontracting or arrangement; provided that the Manager shall remain responsible to the Service Recipients for any Services provided by such Person. Any such subcontracting will be subject to the terms of this Agreement and covered by the fees payable under this Agreement.

 

ARTICLE 3
 SERVICES AND POWERS OF THE MANAGER

 

3.1          Services

 

The Manager will provide, or arrange for the provision by other Service Providers of, and will have the exclusive power and authority to provide or arrange for the provision by other Service Providers of, the services set forth on Appendix A, as such Appendix A may be updated from time to time in accordance with this Agreement (the “Services”), to the Service Recipients.

 

3.2          Supervision of Manager’s Activities

 

The Manager shall, at all times, be subject to the supervision of the relevant Service Recipient’s Governing Body and shall only provide or arrange for the provision of such Services as such Governing Body may request from time to time.

 

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3.3          Restrictions on the Manager

 

3.3.1       The Manager shall, and shall cause any other Service Provider to, refrain from taking any action that is not in compliance with or would violate any Laws or that otherwise would not be permitted by the Governing Instruments of the Service Recipients. If the Manager or any Service Provider is instructed to take any action that is not in such compliance by a Service Recipient’s Governing Body, such person will promptly notify such Governing Body of its judgment that such action would not comply with or violate any such Laws or otherwise would not be permitted by such Governing Instrument.

 

3.3.2       In performing its duties under this Agreement, each member of the Manager Group shall be entitled to rely in good faith on qualified experts, professionals and other agents (including on accountants, appraisers, consultants, legal counsel and other professional advisors) and shall be permitted to rely in good faith upon the direction of a Service Recipient’s Governing Body to evidence any approvals or authorizations that are required under this Agreement. All references in this Agreement to the Service Recipients or Governing Body for the purposes of instructions, approvals and requests to the Manager will refer to the Governing Body.

 

3.4          Errors and Omissions Insurance

 

The Manager shall, and shall cause any other Service Provider to, at all times during the term of this Agreement maintain “errors and omissions” insurance coverage and other insurance coverage which is customarily carried by Persons performing functions that are similar to those performed by the Service Providers under this Agreement with reputable insurance companies and in an amount which is comparable to that which is customarily maintained by such other Persons. In each case, the relevant Service Recipients shall be included as additional insured or loss payees under the relevant policies.

 

ARTICLE 4
 RELATIONSHIP BETWEEN THE MANAGER AND THE SERVICE RECIPIENTS

 

4.1          Other Activities

 

No member of the Manager Group (and no Affiliate, director, officer, member, partner, shareholder or employee of any member of the Manager Group) shall be prohibited from engaging in other business activities or sponsoring, or providing services to, third parties that compete directly or indirectly with the Service Recipients.

 

4.2          Independent Contractor, No Partnership or Joint Venture

 

The Parties acknowledge that the Manager is providing or arranging for the provision of the Services hereunder as an independent contractor and that the Service Recipients and the Manager are not partners or joint venturers with or agents of each other, and nothing herein will be construed so as to make them partners, joint venturers or agents or impose any liability for that reason on any of them as a result of this Agreement; provided, however, that nothing herein will be construed so as to prohibit the Service Recipients and the Manager from embarking upon an investment together as partners, joint venturers or in any other manner whatsoever.

 

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ARTICLE 5
 MANAGEMENT AND EMPLOYEES

 

5.1          Management and Employees

 

5.1.1       The Manager shall arrange, or shall cause another member of the Manager Group to arrange, for such qualified personnel and support staff to be available to carry out the Services. Such personnel and support staff shall devote such of their time to the provision of the Services to the Service Recipients as the relevant member of the Manager Group reasonably deems necessary and appropriate in order to fulfill its obligations hereunder. Such personnel and support staff need not have as their primary responsibility the provision of the Services to the Service Recipients or be dedicated exclusively to the provision of the Services to the Service Recipients.

 

5.1.2       Zephyr shall, and shall cause each of the other Service Recipients to, do all things reasonably necessary on its part as requested by any member of the Manager Group consistent with the terms of this Agreement to enable such member of the Manager Group to fulfill its obligations, covenants and responsibilities hereunder, including making available to such member of the Manager Group, and granting such member of the Manager Group access to, the employees and contractors of the Service Recipients as any member of the Manager Group may from time to time reasonably request.

 

5.1.3       The Manager agrees, and agrees to cause the Manager Group, to exercise the power and discharge the duties conferred under this Agreement honestly and in good faith, and to exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances. Manager shall be responsible for any member of the Manager Group’s failure to exercise such power and duties in accordance with the standards set forth in this Section 5.1.3.

 

ARTICLE 6
 INFORMATION AND RECORDS

 

6.1          Books and Records

 

The Manager shall, or shall cause any other member of the Manager Group to, as applicable, maintain proper books, records and documents on behalf of each Service Recipient, in which complete, true and correct entries, in conformity in all material respects with GAAP and all requirements of applicable Laws, will be made.

 

6.2          Examination of Records by the Service Recipients

 

Upon reasonable prior notice by the Service Recipients to the relevant member of the Manager Group, the relevant member of the Manager Group will make available to the Service Recipients and their authorized representatives, for examination during normal business hours on any Business Day, all books, records and documents required to be maintained under Section 6.1. In addition, the applicable member of the Manager Group will make available to the Service Recipients or their authorized representatives such financial and operating data in respect of the performance of the Services under this Agreement as may be in existence and as the

 

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Service Recipients or their authorized representatives will from time to time reasonably request, including for the purposes of conducting any audit in respect of expenses of the Service Recipients or other matters necessary or advisable to be audited in order to conduct an audit of the financial affairs of the Service Recipients. Any examination of records will be conducted in a manner which will not unduly interfere with the conduct of the business of any member of the Manager Group in the ordinary course.

 

6.3          Access to Information by Manager Group

 

6.3.1       Zephyr shall, and shall cause the other Service Recipients to:

 

6.3.1.1        grant, or cause to be granted, to the Manager Group full access to all documentation and information reasonably necessary in order for the Manager Group to perform its obligations, covenants and responsibilities pursuant to the terms hereof and to enable the Manager Group to provide the Services; and

 

6.3.1.2        provide, or cause to be provided, all documentation and information as may be reasonably requested by any member of the Manager Group, and promptly notify the appropriate member of the Manager Group of any material facts or information of which the Service Recipients are aware, including any known, pending or threatened suits, actions, claims, proceedings or orders by or against any member of the Zephyr Group before any Governmental Authority, that may affect the performance of the obligations, covenants or responsibilities of the Manager Group pursuant to this Agreement, including maintenance of proper financial records.

 

6.4          Additional Information

 

The Parties acknowledge and agree that conducting the activities and providing the Services contemplated herein may have the incidental effect of providing additional information which may be utilized with respect to, or may augment the value of, business interests and related assets in which any of the Service Providers or any of its Affiliates has an interest and that, subject to compliance with this Agreement, none of the Service Providers or any of their respective Affiliates will be liable to account to the Service Recipients with respect to such activities or results; provided, however, that the relevant Service Provider will not (and will cause its Affiliates not to), in making any use of such additional information, do so in any manner that the relevant Service Provider or its Affiliates knows, or ought reasonably to know, would cause or result in a breach of any confidentiality provision of agreements to which any Service Recipient is a party or is bound.

 

6.5          Confidential Information

 

Manager shall not, and shall cause the other members of the Management Group not to, without the prior written consent of Zephyr, publicly disclose any information it may have or obtain, in Manager’s capacity as a manager under this Agreement, concerning the Service Recipients and their respective assets, business, operations or prospects (the “Confidential Information”); provided, however, that Confidential Information shall not include information that (a) becomes generally available to the public other than as a result of a disclosure by a

 

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member of the Manager Group or any of its directors, officers, agents, or other representatives, (b) becomes available to a member of the Manager Group or any of its directors, officers, agents, or other representatives on a nonconfidential basis prior to its disclosure by the Service Recipients or their respective Affiliates, or their respective directors, officers, agents, or other representatives (and is not received in any other capacity of the members of the Manager Group) or (c) is required or requested to be disclosed by a member of the Manager Group as a result of any applicable legal or regulatory requirement or rule or regulation of any stock exchange, or other regulatory authority having jurisdiction over such member of the Manager Group. Notwithstanding the foregoing, the members of the Manager Group may disclose Confidential Information received by them to their employees, consultants, legal counsel, or other agents involved in providing services under this Agreement; provided, that Manager informs each such Person who has access to the Confidential Information of the confidential nature of such Confidential Information, the terms of this Agreement, and that such terms apply to them. If any member of the Manager Group is required to disclose information pursuant to clause (c) or (d) above, such member of the Manager Group will provide the Zephyr with prompt written notice so that the Zephyr may seek a protective order or other appropriate remedy or waive compliance with the non-disclosure provisions of this Section 6.5 with respect to the information required to be disclosed. If such protective order or other remedy is not obtained, Manager will furnish only that portion of such information that counsel advises is legally required to be furnished and will exercise reasonable efforts, at Zephyr’s expense, to obtain reliable assurance that confidential treatment will be accorded such information. Notwithstanding anything contained in this Agreement to the contrary, the obligations of Manager set forth in this Section 6.5 shall survive any termination of this Agreement for a period of 12 months after such termination.

 

ARTICLE 7
 FEES AND EXPENSES

 

7.1                               Annual Fee

 

7.1.1                     Zephyr, on behalf of the Service Recipients, hereby agrees to pay, during the term of this Agreement, the Annual Fee. The Annual Fee shall be pro-rated and paid quarterly in arrears. For purposes of the initial payment hereunder, the Annual Fee will accrue commencing on the Effective Date and will be pro-rated based on the actual number of days during the first Quarter in which this Agreement is in effect.

 

7.1.2                     The Annual Fee will not be reduced by operation of this Agreement by the amount of (i) any fees for Operational and Other Services that are paid or payable by any member of the Zephyr Group to any member of the Manager Group or (ii) any Transaction Fees.

 

7.1.3                     Notwithstanding Section 7.1.2, the Annual Fee will be offset against the Annual Fee (as defined in the Corresponding MSA) payable under the Corresponding MSA.

 

7.2                               Computation and Payment of Quarterly Annual Fee

 

7.2.1                     Following the end of each Quarter, Manager shall prepare and deliver to Zephyr the accrued quarterly installment of the Annual Fee for such Quarter. Zephyr will, subject

 

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to any offset as contemplated by Section 7.1.3, pay the quarterly installment of the Annual Fee for each Quarter as soon as practicable following the end of the Quarter with respect to which such payment is due, but in any event no later than 30 days following the end of such Quarter.

 

7.3                               Governmental Charges

 

Zephyr, on behalf of the Service Recipients, shall pay or reimburse the relevant member of the Manager Group for all sales taxes, use taxes, value added taxes, withholding taxes or other similar taxes, customs duties or other governmental charges (“Governmental Charges”) that are levied or imposed by any Governmental Authority on such member of the Manager Group by reason of the provision of the Services by such member of the Manager Group in connection with this Agreement or any other agreement contemplated by this Agreement, or the fees or other amounts payable in connection therewith, except for any income taxes, corporation taxes, capital taxes or other similar taxes payable by any member of the Manager Group which are personal to such member of the Manager Group. Any failure by any member of the Manager Group to collect monies on account of these Governmental Charges shall not constitute a waiver of the right to do so. Governmental Charges will be offset against Governmental Charges (as defined in the Corresponding MSA) payable under the Corresponding MSA.

 

7.4                               Computation and Payment of Governmental Charges

 

From time to time the Manager shall, or shall cause the other Service Providers to, prepare statements (each an “Expense Statement”) documenting the Governmental Charges to be reimbursed pursuant to this Article 7 and shall deliver such statements to the relevant Service Recipient. All Governmental Charges reimbursable pursuant to this Article 7 shall, subject to any offset as contemplated by Section 7.3, be reimbursed by Zephyr, on behalf of the Service Recipients, no later than the date which is 30 days after receipt of an Expense Statement. The provisions of this Section 7.4 shall survive the termination of this Agreement.

 

ARTICLE 8
 REPRESENTATIONS AND WARRANTIES
 OF THE MANAGER AND THE SERVICE RECIPIENTS

 

8.1                               Representations and Warranties of the Manager

 

The Manager hereby represents and warrants to the Service Recipients that:

 

8.1.1                     it is validly organized and existing under the laws of the State of Delaware;

 

8.1.2                     it, or any another Service Provider, as applicable, holds, and shall hold, such Permits as are necessary to perform its obligations hereunder and is not aware of, or shall inform the Service Recipients promptly upon knowledge of, any reason why such Permits might be cancelled;

 

8.1.3                     it has the power, capacity and authority to enter into this Agreement and to perform its obligations hereunder;

 

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8.1.4                     it has taken all necessary action to authorize the execution, delivery and performance of this Agreement;

 

8.1.5                     the execution and delivery of this Agreement by it and the performance by it of its obligations hereunder do not and will not contravene, breach or result in any default under its Governing Instruments, or under any mortgage, lease, agreement or other legally binding instrument, Permit or applicable Law to which it is a party or by which it or any of its properties or assets may be bound, except for any such contravention, breach or default which would not have a material adverse effect on the business, assets, financial condition or results of operations of the Manager;

 

8.1.6                     no authorization, consent or approval, or filing with or notice to any Person is required in connection with the execution, delivery or performance by it of this Agreement; and

 

8.1.7                     this Agreement constitutes its valid and legally binding obligation, enforceable against it in accordance with its terms, subject to (i) applicable bankruptcy, insolvency, moratorium, fraudulent conveyance, reorganization and other laws of general application limiting the enforcement of creditors’ rights and remedies generally and (ii) general principles of equity, including standards of materiality, good faith, fair dealing and reasonableness, equitable defenses and limits as to the availability of equitable remedies, whether such principles are considered in a proceeding at law or in equity.

 

8.2                               Representations and Warranties of the Service Recipients

 

Zephyr hereby represents and warrants, on its behalf and on behalf of each of the other Service Recipients, to the Manager that:

 

8.2.1                     it is validly organized and existing under the Laws governing its formation and organization;

 

8.2.2                     it, or the relevant Service Recipient, holds such Permits necessary to own and operate the projects and entities that it directly or indirectly owns or operates from time to time and is not aware of any reason why such Permits might be cancelled;

 

8.2.3                     it has the power, capacity and authority to enter into this Agreement and to perform its duties and obligations hereunder;

 

8.2.4                     it has taken all necessary action to authorize the execution, delivery and performance of this Agreement;

 

8.2.5                     the execution and delivery of this Agreement by it and the performance by it of its obligations hereunder do not and will not contravene, breach or result in any default under its Governing Instruments, or under any mortgage, lease, agreement or other legally binding instrument, Permit or applicable Law to which it is a party or by which any of its properties or assets may be bound, except for any such contravention, breach or default which would not have a material adverse effect on the business, assets, financial condition or results of operations of the Service Recipients as a whole;

 

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8.2.6                     no authorization, consent or approval, or filing with or notice to any Person is required in connection with the execution, delivery or performance by it of this Agreement; and

 

8.2.7                     this Agreement constitutes its valid and legally binding obligation, enforceable against it in accordance with its terms, subject to: (i) applicable bankruptcy, insolvency, moratorium, fraudulent conveyance, reorganization and other laws of general application limiting the enforcement of creditors’ rights and remedies generally; and (ii) general principles of equity, including standards of materiality, good faith, fair dealing and reasonableness, equitable defenses and limits as to the availability of equitable remedies, whether such principles are considered in a proceeding at law or in equity.

 

ARTICLE 9
 LIABILITY AND INDEMNIFICATION

 

9.1                               Indemnity

 

9.1.1                     Zephyr hereby agrees, to the fullest extent permitted by applicable Laws, to indemnify and hold harmless, and to cause each other Service Recipient to indemnify and hold harmless, each member of the Manager Group, any of its Affiliates (other than any member of the Zephyr Group) and any directors, officers, agents, members, partners, stockholders and employees and other representatives of each of the foregoing (each, a “Manager Indemnified Party”) from and against any claims, liabilities, losses, damages (but expressly excluding any consequential damages that were not reasonably foreseeable and punitive damages, except to the extent awarded in a final judgment in respect of a Third Party Claim), costs or expenses (including legal fees) (“Liabilities”) incurred by them or threatened in connection with any and all actions, suits, investigations, proceedings or claims of any kind whatsoever, whether arising under statute or action of a Governmental Authority or otherwise or in connection with the business, investments and activities of the Service Recipients or in respect of or arising from this Agreement or the Services provided hereunder (“Claims”), including any Claims arising on account of the Governmental Charges contemplated by Section 7.3; provided, that no Manager Indemnified Party shall be so indemnified with respect to any Claim to the extent that such Claim is finally determined by a final and non-appealable judgment entered by a court of competent jurisdiction, or pursuant to a settlement agreement agreed to by such Manager Indemnified Party, to have resulted from such Manager Indemnified Party’s bad faith, fraud, willful misconduct or gross negligence or, in the case of a criminal matter, conduct undertaken with knowledge that the conduct was unlawful.

 

9.1.2                     If any action, suit, investigation, proceeding or claim is made or brought by any third party with respect to which an Indemnifying Party is obligated to provide indemnification under this Agreement (a “Third Party Claim”), the Manager Indemnified Party will have the right to employ its own counsel in connection therewith, and the reasonable fees and expenses of such counsel, as well as the reasonable costs (excluding an amount reimbursed to such Manager Indemnified Party for the time spent in connection therewith) and out-of-pocket expenses incurred in connection therewith

 

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will be paid by the Indemnifying Party in such case, as incurred but subject to recoupment by the Indemnifying Party if ultimately it is not liable to pay indemnification hereunder.

 

9.1.3                     The Manager Indemnified Party and the Indemnifying Party agree that, promptly after the receipt of notice of the commencement of any Third Party Claim, the Manager Indemnified Party will notify the Indemnifying Party in writing of the commencement of such Third Party Claim (provided, that any accidental failure to provide any such notice will not prejudice the right of any such Manager Indemnified Party hereunder) and, throughout the course of such Third Party Claim, such Manager Indemnified Party will use its reasonable best efforts to provide copies of all relevant documentation to such Indemnifying Party, and to keep the Indemnifying Party apprised of the progress thereof, and to discuss with the Indemnifying Party all significant actions proposed.

 

9.1.4                     The Parties expressly acknowledge and agree that the right to indemnity provided in this Section 9.1 shall be in addition to and not in derogation of any other liability which the Indemnifying Party in any particular case may have or of any other right to indemnity or contribution which any Manager Indemnified Party may have by statute or otherwise at law.

 

9.1.5                     The indemnity provided in this Section 9.1 shall survive the completion of Services rendered under, or any termination or purported termination of, this Agreement.

 

9.2                               Limitation of Liability

 

9.2.1                     The Manager assumes no responsibility under this Agreement other than to render the Services in good faith and will not be responsible for any action of a Service Recipient’s Governing Body in following or declining to follow any advice or recommendations of the relevant Service Provider.

 

9.2.2                     The Service Recipients hereby agree that no Manager Indemnified Party will be liable to a Service Recipient, a Service Recipient’s Governing Body (including, for greater certainty, a director or officer of a Service Recipient or another individual with similar function or capacity) or any security holder or partner of a Service Recipient for any Liabilities that may occur as a result of any acts or omissions by the Manager Indemnified Party pursuant to or in accordance with this Agreement, except to the extent that such Liabilities are finally determined by a final and non-appealable judgment entered by a court of competent jurisdiction to have resulted from the Manager Indemnified Party’s bad faith, fraud, willful misconduct or gross negligence, or in the case of a criminal matter, conduct undertaken with knowledge that the conduct was unlawful.

 

9.2.3                     The maximum amount of the aggregate liability of the Manager Indemnified Parties pursuant to this Agreement will be equal to the amounts previously payable (not taking into account any offset contemplated by Article 7) in respect of Services pursuant to this Agreement in the two most recent calendar years by the Service Recipients pursuant to Article 7.

 

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9.2.4                     For the avoidance of doubt, the provisions of this Section 9.2 shall survive the completion of the Services rendered under, or any termination or purported termination of, this Agreement.

 

9.3                               Benefit to all Manager Indemnified Parties

 

9.3.1                     Zephyr on behalf of itself and the other Service Recipients, hereby constitute the Manager as trustee for each of the Manager Indemnified Parties of the covenants of the Service Recipients under this Article 9 with respect to such Manager Indemnified Parties and the Manager hereby accepts such trust and agrees to hold and enforce such covenants on behalf of the Manager Indemnified Parties.

 

9.3.2                     The Manager hereby constitutes the Service Recipients as trustees for each Service Recipient’s Governing Body (including, for greater certainty, a director or officer of a Service Recipient or another individual with similar function or capacity) or any security holder or partner of a Service Recipient, of the covenants of the Manager under this Article 9 with respect to such parties and the Service Recipients hereby accept such trust and agree to hold and enforce such covenants on behalf of such parties.

 

ARTICLE 10
 TERM AND TERMINATION

 

10.1                        Term

 

This Agreement shall continue in full force and effect in perpetuity until terminated in accordance with Section 10.2, Section 10.3 or Section 12.1.1.

 

10.2                        Termination by the Service Recipients

 

10.2.1              Zephyr, on behalf of the Service Recipients, may, subject to Section 10.2.2, terminate this Agreement effective upon 30 days’ prior written notice of termination to the Manager without payment of any termination fee if:

 

10.2.1.1                  any member of the Manager Group defaults in the performance or observance of any material term, condition or agreement contained in this Agreement in a manner that results in material harm to the Service Recipients and such default continues for a period of 30 days after written notice thereof specifying such default and requesting that the same be remedied in such 30-day period;

 

10.2.1.2                  any member of the Manager Group engages in fraud, misappropriation of funds or embezzlement against any Service Recipient;

 

10.2.1.3                  any member of the Manager Group is grossly negligent in the performance of its obligations under this Agreement, and such gross negligence results in material harm to the Service Recipients;

 

10.2.1.4                  the Manager or Zephyr makes a general assignment for the benefit of its

 

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creditors, institutes proceedings to be adjudicated voluntarily bankrupt, consents to the filing of a petition of bankruptcy against it, is adjudicated by a court of competent jurisdiction as being bankrupt or insolvent, seeks reorganization under any bankruptcy law or consents to the filing of a petition seeking such reorganization or has a decree entered against it by a court of competent jurisdiction appointing a receiver liquidator, trustee or assignee in bankruptcy or in insolvency.

 

10.2.2              This Agreement may only be terminated pursuant to Section 10.2.1 above by Zephyr with the prior approval of a majority of the members of the Board of Directors.

 

10.2.3              This Agreement may also be terminated by Zephyr pursuant to Section 12.1.1 with the prior approval of a majority of the members of the Board of Directors.

 

10.2.4              Zephyr hereby agrees and confirms that this Agreement may not be terminated due solely to the poor performance or underperformance of any of their Subsidiaries or the Business or any investment made by any member of the Zephyr Group on the recommendation of any member of the Manager Group.

 

10.3                        Termination by the Manager

 

10.3.1              The Manager may terminate this Agreement effective upon 180 days’ prior written notice of termination to Zephyr without payment of any termination fee if:

 

10.3.1.1                  any Service Recipient defaults in the performance or observance of any material term, condition or agreement contained in this Agreement in a manner that results in material harm to the Manager and such default continues for a period of 30 days after written notice thereof specifying such default and requesting that the same be remedied in such 30-day period; or

 

10.3.1.2                  any Service Recipient makes a general assignment for the benefit of its creditors, institutes proceedings to be adjudicated voluntarily bankrupt, consents to the filing of a petition of bankruptcy against it, is adjudicated by a court of competent jurisdiction as being bankrupt or insolvent, seeks reorganization under any bankruptcy law or consents to the filing of a petition seeking such reorganization or has a decree entered against it by a court of competent jurisdiction appointing a receiver liquidator, trustee or assignee in bankruptcy or in insolvency.

 

10.4                        Survival Upon Termination

 

If this Agreement is terminated pursuant to this Article 10 or Article 12, such termination will be without any further liability or obligation of any Party, except as provided in Section 1.3, Section 6.4, Section 6.5, Article 9, this Section 10.4, Section 10.6, Article 11, Section 12.3, Section 12.4, Section 12.5, Section 12.6, Section 12.7, Section 12.8, Section 12.9 and Section 12.10.

 

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10.5                        Action Upon Termination

 

10.5.1              From and after the effective date of the termination of this Agreement, the Manager shall not be entitled to receive the Annual Fee for further Services under this Agreement, but will be paid all compensation accruing to and including the date of termination (including such day).

 

10.5.2              Upon any termination of this Agreement, the Manager shall promptly:

 

10.5.2.1                  after deducting any accrued compensation and reimbursements to which it is then entitled, pay to the Service Recipients all money collected and held for the account of the Service Recipients pursuant to this Agreement;

 

10.5.2.2                  deliver to the Service Recipients’ Governing Bodies a full accounting, including a statement showing all payments collected by it and a statement of all money held by it, covering the period following the date of the last accounting furnished to the Governing Bodies with respect to the Service Recipients; and

 

10.5.2.3                  deliver to the Service Recipients’ Governing Bodies all property and documents of the Service Recipients then in the custody of the Manager Group.

 

10.6                        Release of Money or other Property Upon Written Request

 

The Manager hereby agrees that any money or other property of the Service Recipients or their Subsidiaries held by the Manager Group under this Agreement shall be held by the relevant member of the Manager Group as custodian for such Person, and the relevant member of the Manager Group’s records shall be appropriately marked clearly to reflect the ownership of such money or other property by such Person. Upon the receipt by the relevant member of the Manager Group of a written request signed by a duly authorized representative of a Service Recipient requesting the relevant member of the Manager Group to release to the Service Recipient any money or other property then held by the relevant member of the Manager Group for the account of such Service Recipient under this Agreement, the relevant member of the Manager Group shall release such money or other property to the Service Recipient promptly, but in no event later than 7 days following such request. The relevant member of the Manager Group shall not be liable to any Service Recipient, a Service Recipient’s Governing Body or any other Person for any acts performed or omissions to act by a Service Recipient in connection with the money or other property released to the Service Recipient in accordance with the second sentence of this Section 10.6. Each Service Recipient shall indemnify and hold harmless the relevant member of the Manager Group, any of its Affiliates (other than any member of the Zephyr Group) and any directors, officers, agents, members, partners, shareholders and employees and other representatives of each of the foregoing from and against any and all Liabilities which arise in connection with the relevant member of the Manager Group’s release of such money or other property to such Service Recipient in accordance with the terms of this Section 10.6. Indemnification pursuant to this provision shall be in addition to any right of such Persons to indemnification under Section 10.1. For the avoidance of doubt, the provisions of this Section 10.6 shall survive termination of this Agreement. The Service Recipients hereby constitute the Manager as trustee for each Person entitled to indemnification pursuant to this Section 10.6 of the covenants of the Service Recipients under this Section 10.6 with respect to such Persons and the Manager hereby accepts such trust and agrees to hold and enforce such

 

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covenants on behalf of such Persons.

 

ARTICLE 11
 ARBITRATION

 

11.1                        Dispute

 

Any dispute or disagreement of any kind or nature between the Parties arising out of or in connection with this Agreement (a “Dispute”) shall be resolved in accordance with this Article 11.

 

11.2                        Arbitration

 

11.2.1              Any Dispute shall be submitted to arbitration (the “Arbitration”) by three (3) Arbitrators pursuant to the procedure set forth in this Section 11.2 and pursuant to the then current Commercial Arbitration Rules (the “Rules”) of the American Arbitration Association (“AAA”). If the provisions of this Section 11.2 are inconsistent with the provisions of the Rules and to the extent of such inconsistency, the provisions of this Section 11.2 shall prevail in any Arbitration.

 

11.2.2              Any Party may make a demand for Arbitration by sending a notice in writing to any other Party, setting forth the nature of the Dispute, the amount involved and the name of one arbitrator appointed by such Party. The demand for Arbitration shall be made no later than thirty (30) days after the event giving rise to the Dispute.

 

11.2.3              Within thirty (30) days after any demand for Arbitration under Section 11.2.2, the other Party shall send a responding statement, which shall contain the name of one arbitrator appointed by the responding Party.

 

11.2.4              Within thirty (30) days of the appointment of the second arbitrator, the two party-appointed arbitrators shall appoint the third arbitrator, who shall act as the chair of the arbitration panel. The third arbitrator shall be appointed from the AAA National Roster (collectively with the two party-appointed arbitrators, the “Arbitrators”).

 

11.2.5              In connection with any Arbitration, the Arbitrators shall allow reasonable requests for (i) the production of documents relevant to the dispute and (ii) taking of depositions.

 

11.2.6              The seat of the arbitration will be the State of Delaware and the language of the arbitration will be English. The Arbitration hearings shall be held in a location in the State of Delaware specified in the demand for Arbitration and shall commence no later than thirty (30) days after the determination of the Arbitrator under Section 11.2.4.

 

11.2.7              The decision of the Arbitrators shall be made not later than sixty (60) days after its appointment. The decision of the Arbitrators shall be final without appeal and binding on the Parties, and may be enforced in any court of competent jurisdiction.

 

11.2.8              Each Party involved in the Dispute shall bear the costs and expenses of all lawyers, consultants, advisors, witnesses and employees retained by it in any Arbitration. The expenses of the Arbitrators shall be paid equally by the Parties unless the Arbitrators

 

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otherwise provides in its award.

 

11.2.9              Notwithstanding any conflicting choice of law provisions in this Agreement or any applicable principles of conflicts of law, the arbitration provisions set forth herein, and any Arbitration conducted hereunder, shall be governed exclusively by the Federal Arbitration Act, 9 U.S.C. § 1, et seq.

 

11.2.10       Judgment on the award rendered by the Arbitrators may be entered in any court having jurisdiction thereof.

 

11.3                        Continued Performance

 

During the conduct of Dispute resolution procedures pursuant to this Article 11, the Parties shall continue to perform their respective obligations under this Agreement and neither Party shall exercise any other remedies to resolve a Dispute.

 

11.4                        Urgent Relief

 

Nothing in this Article 11 will prejudice the right of a Party to seek urgent injunctive or declaratory relief from a court pursuant to Section 12.8.2.

 

ARTICLE 12
 GENERAL PROVISIONS

 

12.1                        Amendment, Waiver

 

12.1.1              Zephyr is entitled to amend the scope of the Services, including by reducing the number of Service Recipients or the nature or description of the Services or otherwise, by providing 90 days’ prior written notice to the Manager; provided, however, that Zephyr may not increase the scope of the Services without the Manager’s prior written consent (not to be unreasonably withheld, conditioned or delayed); provided, further, however, that prior to such modification, Zephyr and the Manager shall agree in writing to any modification of the Annual Fee resulting from such change in scope. Subject to Section 10.2.3, in the event that Zephyr and the Manager are unable to agree on a modified Annual Fee, Zephyr may terminate this Agreement after the end of such 90-day period by providing 30 days’ prior written notice to the Manager. Notwithstanding the notice period set forth in this Section 12.1.1, in the event of an assignment pursuant to Section 12.2.1(ii) below, Zephyr may amend the scope of Services as set forth in this Section 12.1.1 by providing 30 days’ prior written notice to the Manager.

 

12.1.2              Except as expressly provided in this Agreement, no amendment or waiver of this Agreement, except pursuant to the first sentence of Section 12.1.1 above, will be binding unless the prior approval of a majority of the members of the Board of Directors is obtained and the amendment or waiver is executed in writing by the Party to be bound thereby. No waiver of any provision of this Agreement will constitute a waiver of any other provision nor will any waiver of any provision of this Agreement constitute a continuing waiver unless otherwise expressly provided. A Party’s failure or delay in exercising any right under this Agreement will not operate as a waiver of that right. A

 

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single or partial exercise of any right will not preclude a Party from any other or further exercise of that right or the exercise of any other right.

 

12.2                        Assignment

 

12.2.1              This Agreement shall not be assigned by the Manager without the prior written consent of Zephyr, except (i) pursuant to Section 2.3, (ii) in the case of assignment to a Person that is the Manager’s successor by merger, consolidation or purchase of assets, in which case the successor shall be bound under this Agreement and by the terms of the assignment in the same manner as the Manager is bound under this Agreement or (iii) to an Affiliate of the Manager or a Person that is, in the reasonable and good faith determination of the Board of Directors, an experienced and reputable manager, in which case the Affiliate or assignee shall be bound under this Agreement and by the terms of the assignment in the same manner as the Manager is bound under this Agreement. In addition, provided, that the Manager provides prior written notice to the Service Recipients for informational purposes only, nothing contained in this Agreement shall preclude any pledge, hypothecation or other transfer or assignment of the Manager’ rights under this Agreement, including any amounts payable to the Manager under this Agreement, to a bona fide lender as security.

 

12.2.2              This Agreement shall not be assigned by any of the Service Recipients without the prior written consent of the Manager, except in the case of assignment by any such Service Recipient to a Person that is its successor by merger, consolidation or purchase of assets, in which case the successor shall be bound under this Agreement and by the terms of the assignment in the same manner as such Service Recipient is bound under this Agreement.

 

12.2.3              Any purported assignment of this Agreement in violation of this Article 12 shall be null and void.

 

12.3                        Failure to Pay When Due

 

Any amount payable by any Service Recipient to any member of the Manager Group hereunder which is not remitted when so due will remain due (whether on demand or otherwise) and interest will accrue on such overdue amounts (both before and after judgment) at a rate per annum equal to the Interest Rate.

 

12.4                        Invalidity of Provisions

 

Each of the provisions contained in this Agreement is distinct and severable and a declaration of invalidity or unenforceability of any such provision or part thereof by a court of competent jurisdiction will not affect the validity or enforceability of any other provision hereof. To the extent permitted by applicable law, the Parties waive any provision of law which renders any provision of this Agreement invalid or unenforceable in any respect. The Parties will engage in good faith negotiations to replace any provision which is declared invalid or unenforceable with a valid and enforceable provision, the economic effect of which comes as close as possible to that of the invalid or unenforceable provision which it replaces.

 

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12.5                        Entire Agreement

 

This Agreement constitutes the entire agreement between the Parties pertaining to the subject matter of this Agreement. There are no warranties, conditions, or representations (including any that may be implied by statute) and there are no agreements in connection with such subject matter except as specifically set forth or referred to in this Agreement. No reliance is placed on any warranty, representation, opinion, advice or assertion of fact made either prior to, contemporaneous with, or after entering into this Agreement, by any Party or its directors, officers, employees or agents, to any other Party or its directors, officers, employees or agents, except to the extent that the same has been reduced to writing and included as a term of this Agreement, and none of the Parties has been induced to enter into this Agreement by reason of any such warranty, representation, opinion, advice or assertion of fact. Accordingly, there will be no liability, either in tort or in contract, assessed in relation to any such warranty, representation, opinion, advice or assertion of fact, except to the extent contemplated above.

 

For the avoidance of doubt, nothing in this Agreement should be construed or interpreted as an amendment, modification or termination of, or conflict with, any of the Operating and Administrative Agreements. Each such agreement, and all its terms, including payments to be made thereunder, shall survive the entry into this Agreement and shall terminate in accordance with its terms.

 

12.6                        Mutual Waiver of Jury Trial

 

AS A SPECIFICALLY BARGAINED FOR INDUCEMENT FOR EACH OF THE PARTIES TO ENTER INTO THIS AGREEMENT (AFTER HAVING THE OPPORTUNITY TO CONSULT WITH COUNSEL), EACH PARTY EXPRESSLY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY LAWSUIT OR PROCEEDING RELATING TO OR ARISING IN ANY WAY FROM THIS AGREEMENT OR THE MATTERS CONTEMPLATED HEREBY.

 

12.7                        Consent to Jurisdiction

 

EACH OF THE PARTIES IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE DELAWARE COURT OF CHANCERY OR, TO THE EXTENT SUCH COURT DECLINES TO ACCEPT JURISDICTION OVER A PARTICULAR MATTER, ANY FEDERAL COURT OF THE UNITED STATES OF AMERICA LOCATED IN THE STATE OF DELAWARE, FOR THE PURPOSES OF ANY SUIT, ACTION OR OTHER PROCEEDING TO ENFORCE THE ARBITRATION PROVISION IN ARTICLE 11 OR TO SPECIFICALLY ENFORCE THE TERMS OF THIS AGREEMENT PURSUANT TO SECTION 12.8.2. THE DECISION IN ANY ARBITRATION SHALL BE FINAL AND BINDING AND MAY BE ENTERED IN ANY COURT HAVING JURISDICTION THEREOF. IF ANY PARTY FAILS TO APPEAR AT ANY PROPERLY NOTICED ARBITRATION PROCEEDING, AN AWARD MAY BE ENTERED AGAINST THAT PARTY IN A COURT HAVING JURISDICTION THEREOF.

 

12.8                        Governing Law

 

12.8.1              The internal law of the State of Delaware will govern and be used to construe this Agreement without giving effect to applicable principles of conflicts of law to the extent

 

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that the application of the laws of another jurisdiction would be required thereby.

 

12.8.2              The Parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement and the transactions contemplated hereby were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and the transactions contemplated hereby and to enforce specifically the terms and provisions of this Agreement and the transactions contemplated hereby in the courts of Delaware, this being in addition to any other remedy to which such Party is entitled at law or in equity.

 

12.9                        Enurement

 

This Agreement will enure to the benefit of and be binding upon the Parties and their respective successors and permitted assigns.

 

12.10                 Notices

 

Any notice, demand or other communication to be given under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given (i) when delivered personally to the recipient, (ii) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; but if not, then on the next Business Day, (iii) one Business Day after it is sent to the recipient by reputable overnight courier service (charges prepaid) or (iv) three Business Days after it is mailed to the recipient by first class mail, return receipt requested. Such notices, demands and other communications shall be sent to the addresses specified below, or at such address or to the attention of such other Person as the recipient party has specified by prior written notice to the sending party. Any Party may change such Party’s address for receipt of notice by giving prior written notice of the change to the sending Party as provided herein. Notices and other communications will be addressed as follows:

 

If to the Service Recipients:

 

Zephyr Renewables LLC
 100 California Street
 Suite 200
 Carlsbad, CA 92008
 Attn: Alicia Stevenson
 Email: Alicia.stevenson@nrg.com

 

With a copy (which shall not constitute notice) to:

 

Zephyr Renewables LLC
 5790 Fleet Street
 Suite 200
 Carlsbad, CA 92008
 Attn: General Counsel
 Email: Jennifer.hein@nrg.com

 

23

 

If to the Manager:

 

NRG Yield, Inc.
 300 Carnegie Center, Suite 300
 Princeton, NJ 08540
 Attn: Chad Plotkin, Chief Financial Officer
 Email:            chad.plotkin@nrg.com

ogc@nrgyield.com

 

12.11                 Further Assurances

 

Each of the Parties will promptly do, make, execute or deliver, or cause to be done, made, executed or delivered, all such further acts, documents and things as the other Party may reasonably require from time to time for the purpose of giving effect to this Agreement and will use reasonable efforts and take all such steps as may be reasonably within its power to implement to their full extent the provisions of this Agreement.

 

12.12                 Counterparts

 

This Agreement may be signed in counterparts and each of such counterparts will constitute an original document and such counterparts, taken together, will constitute one and the same instrument.

 

(Signature pages follow)

 

24

 

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

 

	
 
    	
ZEPHYR   RENEWABLES LLC
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Craig Cornelius
    
	
 
    	
 
    	
Name:
    	
Craig   Cornelius
    
	
 
    	
 
    	
Title:
    	
President
    

 

[Signature Page to Master Services Agreement]

 

 

	
 
    	
NRG YIELD, INC., as Manager
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Chad Plotkin
    
	
 
    	
 
    	
Name:
    	
Chad   Plotkin
    
	
 
    	
 
    	
Title:
    	
Senior   Vice President & CFO
    

 

	
 
    	
NRG YIELD LLC, as Manager
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Chad Plotkin
    
	
 
    	
 
    	
Name:
    	
Chad   Plotkin
    
	
 
    	
 
    	
Title:
    	
Senior   Vice President, CFO & Treasurer
    

 

	
 
    	
NRG YIELD OPERATING LLC, as Manager
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Chad Plotkin
    
	
 
    	
 
    	
Name:
    	
Chad   Plotkin
    
	
 
    	
 
    	
Title:
    	
Senior   Vice President, CFO & Treasurer
    

 

[Signature Page to Master Services Agreement]Exhibit 10.3

 

Execution Version

 

RIGHT OF FIRST OFFER AGREEMENT

 

THIS RIGHT OF FIRST OFFER AGREEMENT (this “Agreement”) is made and entered into as of August 31, 2018 (the “Effective Date”), by and between ZEPHYR RENEWABLES LLC, a Delaware limited liability company (“Zephyr”), and NRG YIELD, INC., a Delaware corporation (“Yield”), and solely for purposes of Section 2.4, GIP III Zephyr Acquisition Partners, L.P., a Delaware limited partnership (“Zephyr Parent”). Zephyr and Yield are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

 

RECITALS

 

WHEREAS, Yield expects to increase its cash available for distribution and dividend per share by acquiring additional assets, including assets acquired from Zephyr; and

 

WHEREAS, Zephyr desires to grant Yield an exclusive right of first offer to acquire certain assets owned by Zephyr and its Subsidiaries (as hereinafter defined) on the terms and conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants set forth in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Zephyr and Yield hereby agree as follows:

 

ARTICLE I

 

DEFINITIONS

 

Section 1.1                                    Definitions. In addition to the terms defined above in the introduction and Recitals to this Agreement, the following terms when used in this Agreement shall have the meanings set forth in this Section 1.1.

 

“Affiliate” means, with respect to the Person in question, any other Person that, directly or indirectly, Controls, is Controlled by or is under common Control with, such Person.

 

“Applicable Law” means all statutes, laws, common law, rules, regulations, ordinances, codes or other legal requirements of any Governmental Authority or quasi-governmental agencies or entities, and any judgment, injunction, order, directive, decree or other judicial or regulatory requirement of any court or Governmental Authority of competent jurisdiction affecting or relating to the Person or property in question.

 

“Business Day” means any day other than Saturday, Sunday or any federal legal holiday.

 

“Carlsbad” consists of 100% of the membership interest in Carlsbad Energy Holdings LLC.

 

“Carlsbad Accrual Adjustment” means the amount equal to (a) the Final Purchase Price (as defined in the Carlsbad Drop Down PSA), multiplied by (b) the Adjusted Trading CAFD Yield (as defined in the Carlsbad Drop Down PSA) as was used to determine the Final Purchase Price under the Carlsbad Drop Down PSA, multiplied by (c) the number of days between the

 

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Closing Date under the Carlsbad Drop Down PSA and the closing of the purchase of Carlsbad under the Carlsbad Purchase Option, divided by (d) 365.

 

“Carlsbad Drop Down PSA” means that certain Purchase and Sale Agreement, dated as of February 6, 2018, by and between NRG Gas Development Company, LLC, as Seller and NRG Yield Operating LLC, as Purchaser.

 

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of the Person in question, whether by the ownership of voting securities, contract or otherwise.

 

“Governmental Authority” means any federal, state or local government or political subdivision thereof, including any agency or entity exercising executive, legislative, judicial, regulatory or administrative governmental powers or functions, in each case to the extent the same has jurisdiction over the Person or property in question.

 

“Kawailoa” consists of 100% of the membership interests in Kawailoa Renewables, LLC, which in turn owns 100% of the membership interests in Kawailoa Solar Portfolio, LLC, which in turn owns 100% of the membership interests in Kawailoa Solar Holdings, LLC which in turn owns 100% of the membership interests in Kawailoa Solar, LLC.

 

“Langford” consists of 100% of the membership interest in Langford Wind Power, LLC.

 

“Losses” means, with respect to the Person in question, any actual liabilities, damages (but expressly excluding any consequential damages that were not reasonably foreseeable and punitive damages), losses, costs or expenses, including reasonable attorneys’ fees and expenses and court costs, incurred by such Person, as a result of the act, omission or occurrence in question.

 

“Mesquite Star” consists of 100% of the membership interests in Mesquite Star Special, LLC.

 

“Negotiation Period” has the meaning set forth in Section 2.2.

 

“Notice” has the meaning set forth in Section 5.1.

 

“NYLD Op” means NRG Yield Operating LLC, a Delaware limited liability company.

 

“Oahu” consists of 100% of the membership interests in Oahu Renewables, LLC, which in turn owns 100% of the membership interests in NRG Oahu Solar Holdings LLC, which in turn owns 100% of the membership interests in NRG Oahu Solar LLC, which in turn owns 100% of the membership interest in (i) Lanikuhana Solar, LLC and (ii) Waipio PV, LLC.

 

“Permitted Back-Leverage Financing” means in respect of any Zephyr ROFO Asset, a debt financing structure pursuant to which Zephyr causes an entity that is a part of such Zephyr ROFO Asset to monetize its investment and cash flow in a project owned by the Zephyr ROFO Asset.

 

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“Permitted Tax Equity Financing” means a tax equity financing entered into in connection with the acquisition, financing or refinancing by any Zephyr ROFO Asset (or any Subsidiary thereof) of any energy generating, transmission or distribution assets (or any assets related thereto).

 

“Person” means any natural person, corporation, general or limited partnership, limited liability company, association, joint venture, trust, estate, Governmental Authority or other legal entity, in each case whether in its own or a representative capacity.

 

“Required Securities Disclosure” has the meaning set forth in Section 4.1.

 

“ROFO Termination Date” has the meaning set forth in Section 2.3.

 

“Solar Portfolio” means one or more distributed generation portfolios developed or owned by Zephyr or its Subsidiaries after the Effective Date.

 

“Subsidiary” means, with respect to any Person, any corporation, limited liability company, general partnership or limited partnership Controlled by such Person.

 

“Term” has the meaning set forth in Section 3.1.

 

“Third Party” means any Person other than a Party or an Affiliate of a Party.

 

“Transaction Notice” has the meaning set forth in Section 2.2.

 

“Transfer” means, other than in connection with any granting of liens permitted under any indebtedness of any Zephyr ROFO Asset or any disposition of assets resulting from the enforcement of such liens, any Permitted Tax Equity Financing or any Permitted Back-Leverage Financing, in each case, in respect of any Zephyr ROFO Asset, any assignment, sale, offer to sell, pledge, mortgage, hypothecation, encumbrance, disposition of or any other like transfer or encumbering (whether with or without consideration, directly or indirectly, voluntarily or involuntarily or by operation of law or otherwise); provided, that this definition shall not include any (i) merger with or into, or sale of all or substantially all of Zephyr’s assets to, an unaffiliated third-party or (ii) internal restructuring involving any Zephyr ROFO Assets, so long as the terms of any such restructuring will not limit, delay or hinder the ability of Yield or any of its Subsidiaries to acquire such Zephyr ROFO Assets from Zephyr in accordance with the terms of this Agreement when Zephyr elects to sell, transfer or otherwise dispose of such Zephyr ROFO Assets.

 

“Zephyr Confidential Information” has the meaning set forth in Section 4.1.

 

“Zephyr Indemnitees” means Zephyr and its Affiliates, and each of their respective shareholders, members, partners, trustees, beneficiaries, directors, officers, employees, attorneys, accountants, consultants and agents, and the successors, assigns, legal representatives, heirs, devisees and donees of each of the foregoing.

 

“Zephyr ROFO Assets” has the meaning set forth in Section 2.1.

 

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ARTICLE II

 

RIGHT OF FIRST OFFER ON ZEPHYR ROFO ASSETS

 

Section 2.1                                    Zephyr ROFO Assets. During the Term, Zephyr hereby grants to Yield and its Subsidiaries a right of first offer on any proposed Transfer of each of Kawailoa, Oahu, Langford, Mesquite Star, Carlsbad (but only if Zephyr or one of its Subsidiaries has acquired Carlsbad following the assignment of NYLD Op’s rights and obligations under the Carlsbad Drop Down PSA pursuant to Section 6.04 of the Carlsbad Drop Down PSA) and the Solar Portfolio (the “Zephyr ROFO Assets”). In connection with the right of first offer on any proposed Transfer of the Solar Portfolio, Zephyr hereby grants Yield the right to make an equity investment of up to $190,000,000 in the Solar Portfolio.

 

Section 2.2                                    Notice of Transaction Related to Zephyr ROFO Assets and Negotiation of Definitive Terms for Transaction. Zephyr must deliver a written notice to Yield no later than forty-five (45) days prior to engaging in any negotiation regarding any proposed Transfer of any Zephyr ROFO Asset (or any portion thereof), setting forth in reasonable detail the material terms and conditions of the proposed transaction (such offer notice, a “Transaction Notice”). If Zephyr delivers a Transaction Notice to Yield, then Zephyr and Yield shall enter non-binding discussions and negotiate in good faith to attempt to agree on definitive terms that are acceptable to both Parties, in their sole and absolute discretion, for the Transfer of the applicable Zephyr ROFO Asset to Yield or any of its Subsidiaries. If, within thirty (30) calendar days after the delivery of such Transaction Notice (the “Negotiation Period”), the Parties have not agreed to definitive terms for the Transfer of such Zephyr ROFO Asset to Yield, Zephyr will be able, within the next one hundred eighty (180) calendar days, to Transfer such Zephyr ROFO Asset to a Third Party (or enter into a definitive agreement to undertake such transaction with a Third Party) in accordance with the terms of Section 2.3.

 

Section 2.3                                    Negotiations with Third Parties. Neither Zephyr nor any of its representatives, agents or Subsidiaries shall solicit offers from, or negotiate or enter into any agreement with, any Third Party for the Transfer of any Zephyr ROFO Asset (or any portion thereof) until the expiration of the Negotiation Period related to such Zephyr ROFO Asset and the proposed Transfer (the “ROFO Termination Date”). Yield agrees and acknowledges that for a period of one hundred eighty (180) calendar days from and after the ROFO Termination Date for any Zephyr ROFO Asset and the applicable proposed Transfer: (a) Zephyr shall have the absolute right to solicit offers from, negotiate with, and enter into agreements with, any Third Party to Transfer such Zephyr ROFO Asset, on terms generally no less favorable to Zephyr than those offered to Yield pursuant to the Transaction Notice, and (b) Zephyr shall have no further obligation to negotiate with Yield regarding, or offer Yield the opportunity to acquire any interest in, such Zephyr ROFO Asset; provided, that the final terms of the Transfer of any Zephyr ROFO Asset to any Third Party be on terms generally no less favorable to Zephyr than those offered to Yield pursuant to the Transaction Notice; provided, further, that if after such one hundred eighty (180) calendar day period Zephyr has not Transferred such Zephyr ROFO Asset to a Third Party, such Zephyr ROFO Asset shall again be subject to this Agreement.

 

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Section 2.4                                    Carlsbad Purchase Option.

 

(a)                                 If Zephyr Parent or one of its Subsidiaries (other than Yield or one of its Subsidiaries) acquires Carlsbad pursuant to the Carlsbad Drop Down PSA following the assignment of NYLD Op’s rights and obligations under the Carlsbad Drop Down PSA pursuant to Section 6.04 of the Carlsbad Drop Down PSA, then for a period of eighteen (18) months following the Closing Date (as defined in the Carlsbad Drop Down PSA), Yield shall have the right to purchase Carlsbad from Zephyr Parent or its applicable Subsidiary (other than Yield and its Subsidiaries), and Zephyr Parent or its applicable Subsidiary (other than Yield and its Subsidiaries) shall be required to sell Carlsbad to Yield (the “Carlsbad Purchase Option”). The purchase price payable by Yield to purchase Carlsbad upon exercising its purchase right shall be equal to (a) the Final Purchase Price (as defined in the Carlsbad Drop Down PSA) plus (b) the Carlsbad Accrual Adjustment,  less (c) the amount of distributions received by Zephyr Parent or its applicable Subsidiary (other than Yield and its Subsidiaries) from Carlsbad following the Closing Date under the Carlsbad Drop Down PSA. If upon the closing of the purchase of Carlsbad by Yield pursuant to the Carlsbad Purchase Option, all parts of the Final Purchase Price under the Carlsbad Drop Down PSA have not been finally determined, the portion of the purchase price payable at the closing of the purchase of Carlsbad pursuant to the Carlsbad Purchase Option under clause (a) above shall instead be equal to the amount paid by Zephyr Parent or its applicable Subsidiary (other than Yield and its Subsidiaries) on the Closing Date under the Carlsbad Drop Down PSA pursuant to Section 2.03(b)(i) of the Carlsbad Drop Down PSA, and the purchase agreement for the Carlsbad Purchase Option shall include a purchase price adjustment to place the parties in the same economic position as they would have been in had the Final Purchase Price under the Carlsbad Drop Down PSA been known at the closing of the purchase of Carlsbad pursuant to the Carlsbad Purchase Option. The purchase agreement for the Carlsbad Purchase Option shall otherwise be substantially consistent with the Carlsbad Drop Down PSA with such modifications thereto as shall be reasonably agreed by Zephyr Parent and Yield.

 

(b)                                 If Yield does not exercise the Carlsbad Purchase Option during the eighteen (18)-month period following the Closing Date, the Carlsbad Purchase Option shall expire, but Carlsbad shall continue to constitute a Zephyr ROFO Asset.

 

ARTICLE III

 

TERM; TERMINATION RIGHTS

 

Section 3.1                                    Term. Unless earlier terminated in accordance with this Article III, the term of this Agreement (the “Term”) shall commence on the Effective Date and shall continue in effect until the fifth (5th) anniversary of the Effective Date, at which time this Agreement shall terminate and the Parties shall have no further rights or obligations under this Agreement, except those that expressly survive the termination of this Agreement.

 

Section 3.2                                    Termination Rights. This Agreement may be terminated at any time (a) by mutual written consent of Zephyr and Yield or (b) by Zephyr or Yield, as the case may be, with written notice to the other Party, if the other Party materially breaches or defaults in the performance of its obligations under this Agreement or under any transaction agreement entered into by the Parties in connection with any Zephyr ROFO Assets, and such breach or default is continuing for thirty (30) days after such breaching Party has been given a written notice

 

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specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder. Upon any such termination the Parties shall have no further rights or obligations under this Agreement, except those that expressly survive the termination of this Agreement.

 

ARTICLE IV

 

CONFIDENTIALITY

 

Section 4.1                                    Zephyr Confidential Information. Yield shall keep confidential and not make any public announcement or disclose to any Person any terms of any documents, materials, data or other information with respect to any Zephyr ROFO Asset which is not generally known to the public (the “Zephyr Confidential Information”); provided, however, that Zephyr Confidential Information shall not include (a) the terms and conditions of this Agreement or (b) information that becomes available to Yield on a non-confidential basis from a source other than the Zephyr, its Affiliates or their directors, officers or employees; provided, that, to Yield’s knowledge, such source was not prohibited from disclosing such information to Yield by any legal, contractual or fiduciary duty. Notwithstanding the foregoing, Yield shall be permitted to (A) disclose any Zephyr Confidential Information to the extent required by court order or under Applicable Law, (B) make a public announcement regarding such matters (1) as agreed to in writing by Zephyr or (2) as required by the provisions of any securities laws or the requirements of any exchange on which Yield securities may be listed (a “Required Securities Disclosure”), or (C) disclose any Zephyr Confidential Information to any Person on a “need-to-know” basis, such as its shareholders, partners, members, trustees, beneficiaries, directors, officers, employees, attorneys, consultants, lenders or other advisors; provided, however, that, other than in connection with a Required Securities Disclosure, Yield shall (x) advise such Person of the confidential nature of such Zephyr Confidential Information, and (y) cause such Person to be bound by obligations of confidentiality pursuant to the terms hereof that are no less stringent than the obligations set forth herein. Yield shall indemnify and hold harmless the Zephyr Indemnitees for any Losses incurred by any of the Zephyr Indemnitees for a breach or default of Yield’s obligations under this Section 4.1. This Section 4.1 shall survive the termination of this Agreement. If Yield purchases any Zephyr ROFO Asset pursuant to the terms of this Agreement, the confidentiality obligations of Yield with respect to such Zephyr ROFO Asset shall terminate upon the consummation of such purchase.

 

ARTICLE V

 

MISCELLANEOUS PROVISIONS

 

Section 5.1                                    Notices.

 

(a)                                 Method of Delivery. All notices, requests, demands and other communications (each, a “Notice”) required to be provided to the other Party pursuant to this Agreement shall be in writing and shall be delivered (i) in person, (ii) by certified U.S. mail, with postage prepaid and return receipt requested, (iii) by overnight courier service, (iv) by facsimile transmittal or (v) by email (which requires an acknowledgement by the recipient, it being understood that the recipient shall be obligated to confirm receipt if requested); provided, that in

 

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the case of clauses (iv) and (v), a verification copy is sent on the same day by any of the methods set forth in clauses (i), (ii) and (iii), to the other Party to this Agreement at the following address, facsimile number or email address (or to such other address, facsimile number or email address as Zephyr or Yield may designate from time to time pursuant to this Section 5.1):

 

If to Zephyr:

 

Zephyr Renewables LLC
 100 California Street
 Suite 200
 Carlsbad, CA 92008
 Attn: Alicia Stevenson
 Email: Alicia.stevenson@nrg.com

 

With a copy (which shall not constitute notice) to:

 

Zephyr Renewables LLC
 5790 Fleet Street
 Suite 200
 Carlsbad, CA 92008
 Attn: General Counsel
 Email: Jennifer.hein@nrg.com

 

If to Zephyr Parent:

 

c/o Global Infrastructure Management, LLC
 1345 Avenue of the Americas, 30th Floor
 New York, New York 10105
 Attention: Jonathan Bram
 Fax: +1 646 282 1500
 Email: jonathan.bram@global-infra.com

 

With a copy to:

 

c/o Global Infrastructure Management, LLP
 The Peak
 5 Wilton Road, 6th Floor 
 London, SW1V 1AN
 United Kingdom
 Attention: Joseph Blum
 Fax: +44 207 798 0530
 Email: joe.blum@global-infra.com

 

With a copy to:

 

Simpson Thacher & Bartlett LLP
 425 Lexington Avenue
 New York, New York 10017

 

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Attn: David Lieberman
 Fax: +1 212 455 2502
 Email: dlieberman@stblaw.com

 

If to Yield:

 

NRG Yield, Inc.
 300 Carnegie Center, Suite 300
 Princeton, NJ 08540

Attn:                    Christopher Sotos

Chad Plotkin

Email:            christopher.sotos@nrgyield.com

chad.plotkin@nrg.com

 

With a copy to:

 

Crowell & Moring LLP

1001 Pennsylvania Avenue, N.W.

Washington, D.C. 20004-2595

Attn: Patrick W. Lynch

E-mail: plynch@crowell.com

Fax: (202) 628-5116

 

(b)                                 Receipt of Notices. All Notices sent by the Parties under this Agreement shall be deemed to have been received by the Party to whom such Notice is sent (i) in the case of delivery by hand, when delivered; (ii) in the case of delivery by first class certified mail, receipt requested, five (5) Business Days after being deposited in the mail, (iii) in the case of overnight courier service guaranteeing next day delivery, on the next Business Day after timely delivery to the courier (iv) in the case of facsimile, on acknowledgement of the addressee’s facsimile receiving equipment if received prior to 5 p.m., recipient’s time, on the Business Day of such transmittal, or on the next Business Day if received later than 5 p.m., recipient’s time or (v) in the case of an email, which requires an acknowledgement of receipt to be sent to the sender, at the time such acknowledgement is received by the sender if received prior to 5 p.m., recipient’s time, on the Business Day of such transmittal, or on the next Business Day if received later than 5 p.m., recipient’s time. If any Party attempts to deliver Notice and such recipient Party refuses delivery of such Notice or such recipient Party is no longer at such address, facsimile number or email address, and such recipient Party failed to provide the sending Party with its current address, facsimile number or email address pursuant to this Section 5.1, then such Notice shall be deemed to have been received by the recipient Party upon the sending Party’s attempted delivery.

 

(c)                                  Change of Address. Zephyr and Yield and their respective counsel shall have the right to change their respective address, facsimile number and/or email address for the purposes of this Section 5.1 by providing a Notice of such change in address, facsimile number and/or email address as required under this Section 5.1.

 

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Section 5.2                                    Time is of the Essence. Time is of the essence of this Agreement; provided, however, that notwithstanding anything to the contrary in this Agreement, if the time period for the performance of any covenant or obligation, satisfaction of any condition or delivery of any notice or item required under this Agreement shall expire on a day other than a Business Day, such time period shall be extended automatically to the next Business Day.

 

Section 5.3                                    Assignment. Neither Party shall assign this Agreement or any interest therein to any Person, without the prior written consent of the other Party, which consent may be withheld in such Party’s sole discretion.

 

Section 5.4                                    Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of Zephyr and Yield and their respective successors and permitted assigns.

 

Section 5.5                                    Third Party Beneficiaries. This Agreement shall not confer any rights or remedies on any Person other than (i) the Parties and their respective successors and permitted assigns, and (ii) the Zephyr Indemnitees to the extent such Zephyr Indemnitees are expressly granted certain rights of indemnification in this Agreement.

 

Section 5.6                                    Other Activities. No Party shall be prohibited from engaging in or holding an interest in any other business ventures of any kind or description, or any responsibility to account to the other for the income or profits of any such enterprises or have this Agreement be deemed to constitute any agreement not to compete. This Agreement shall not be deemed to create a partnership, joint venture, association or any other similar relationship between the Parties.

 

Section 5.7                                    Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.

 

(a)                                 This Agreement and the transactions contemplated hereby shall be governed by the laws of the State of Delaware, without giving effect to any principles regarding conflict of laws. Any litigation or other court proceeding with respect to any matter arising from or in connection with this Agreement shall be conducted in the courts of record in the State of Delaware of the United States District Court for the District of Delaware, and Zephyr and Yield hereby submit to jurisdiction and consent to venue in such courts.

 

(b)                                 Zephyr and Yield hereby waive their right to a trial by jury in any litigation or other court proceeding by either Party against the other Party with respect to any matter arising from or in connection with this Agreement or the transactions contemplated hereby.

 

(c)                                  If any litigation or other court action, arbitration or similar adjudicatory proceeding is sought, taken, instituted or brought by Zephyr or Yield to enforce its rights under this Agreement, all fees, costs and expenses, including, without limitation, reasonable attorney’s fees and court costs, of the prevailing Party in such action, suit or proceeding shall be borne by the Party against whose interest the judgment or decision is rendered.

 

(d)                                 The Parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement and the transactions contemplated hereby were not performed in accordance with their specific terms or were otherwise breached. It is accordingly

 

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agreed that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and the transactions contemplated hereby and to enforce specifically the terms and provisions of this Agreement and the transactions contemplated hereby in the courts of Delaware, this being in addition to any other remedy to which such Party is entitled at law or in equity.

 

Section 5.8                                    Rules of Construction. The following rules shall apply to the construction and interpretation of this Agreement:

 

(a)                                 Singular words shall connote the plural as well as the singular, and plural words shall connote the singular as well as the plural, and the masculine shall include the feminine and the neuter.

 

(b)                                 All references in this Agreement to particular articles, sections, subsections or clauses (whether in upper or lower case) are references to articles, sections, subsections or clauses of this Agreement. All references in this Agreement to particular exhibits or schedules (whether in upper or lower case) are references to the exhibits and schedules attached to this Agreement, unless otherwise expressly stated or clearly apparent from the context of such reference.

 

(c)                                  The headings contained herein are solely for convenience of reference and shall not constitute a part of this Agreement nor shall they affect its meaning, construction or effect.

 

(d)                                 Each Party and its counsel have reviewed and revised (or requested revisions of) this Agreement and have participated in the preparation of this Agreement, and therefore any usual rules of construction requiring that ambiguities are to be resolved against any Party shall not be applicable in the construction and interpretation of this Agreement or any exhibits hereto.

 

(e)                                  The terms “hereby,” “hereof,” “hereto,” “herein,” “hereunder” and any similar terms shall refer to this Agreement, and not solely to the provision in which such term is used.

 

(f)                                   The terms “include,” “including” and similar terms shall be construed as if followed by the phrase “without limitation.”

 

(g)                                  The term “sole discretion” with respect to any determination to be made by a Party under this Agreement shall mean the sole and absolute discretion of such Party, without regard to any standard of reasonableness or other standard by which the determination of such Party might be challenged.

 

Section 5.9                                    Severability. If any term or provision of this Agreement is held to be or rendered invalid or unenforceable at any time in any jurisdiction, such term or provision shall not affect the validity or enforceability of any other terms or provisions of this Agreement, or the validity or enforceability of such affected terms or provisions at any other time or in any other jurisdiction.

 

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Section 5.10                             Recitals, Exhibits and Schedules. The recitals to this Agreement, and all exhibits and schedules referred to in this Agreement are incorporated herein by such reference and made a part of this Agreement. Any matter disclosed in any schedule to this Agreement shall be deemed to be incorporated in all other schedules to this Agreement.

 

Section 5.11                             Entire Agreement. This Agreement sets forth the entire understanding and agreement of the Parties hereto, and shall supersede any other agreements and understandings (written or oral) between Zephyr and Yield on or prior to the date of this Agreement with respect to the matters contemplated in this Agreement.

 

Section 5.12                             Amendments to Agreement. No amendment, supplement or other modification to any terms of this Agreement shall be valid unless in writing and executed and delivered by Zephyr and Yield.

 

Section 5.13                             Facsimile; Counterparts. Zephyr and Yield may deliver executed signature pages to this Agreement by facsimile or electronic transmission to the other Party, which facsimile or electronic copy shall be deemed to be an original executed signature page. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and all of which counterparts together shall constitute one agreement with the same effect as if the Parties had signed the same signature page.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, Zephyr and Yield each have caused this Agreement to be executed and delivered in their names by their respective duly authorized officers or representatives as of the date first above written.

 

	
 
    	
Zephyr:
    
	
 
    	
 
    
	
 
    	
ZEPHYR RENEWABLES LLC,
 a Delaware limited liability   company
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Craig Cornelius
    
	
 
    	
 
    	
Name:
    	
Craig   Cornelius
    
	
 
    	
 
    	
Title:
    	
President
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Yield:
    
	
 
    	
 
    
	
 
    	
NRG YIELD, INC.,
    a Delaware   Corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Chad Plotkin
    
	
 
    	
 
    	
Name:
    	
Chad   Plotkin
    
	
 
    	
 
    	
Title:
    	
Senior   Vice President & CFO
    

 

[Signature Page to ROFO Agreement]

 

 

	
 
    	
Zephyr   Parent:
    
	
 
    	
 
    
	
 
    	
GIP   III ZEPHYR ACQUISITION PARTNERS, L.P.,
   a Delaware limited partnership
    
	
 
    	
 
    
	
 
    	
By:
    	
Global Infrastructure GP III, L.P., its general partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
Global Infrastructure Investors III, LLC, its general partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Jonathan Bram
    
	
 
    	
Name:
    	
Jonathan Bram
    
	
 
    	
Title:
    	
Partner
    

 

[Signature Page to ROFO Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00287-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00287-of-00352.parquet"}]]