Document:

Exhibit 10.2

Exhibit 10.2

Execution Version

CONTRACT

FOR THE SUPPLY OF DFC® MODULES AND DFC® COMPONENTS

FROM FUELCELL ENERGY INC. (SELLER)

TO POSCO POWER (BUYER)

JUNE 9, 2009

Confidential treatment requested as to certain portions
of this exhibit marked with an *. Such portions have been redacted and filed separately with the SEC.

 

 

 

PURCHASE AND SALE CONTRACT

This PURCHASE AND SALE CONTRACT (the “Contract”) is made and entered into this 9th day
of June, 2009, by and between POSCO Power Corporation, a corporation duly organized and existing
under the laws of the Republic of Korea having a place of business at Posteel Tower 20th
floor, 735-3, Yeoksam-dong, Gangnam-gu, Seoul 135-080, Korea (hereinafter referred to as “POSCO
Power” or the “Buyer”) and FuelCell Energy, Inc., a corporation duly organized and existing under
the laws of the State of Delaware, U.S.A., with its principal office at 3 Great Pasture Rd.,
Danbury, Connecticut, U.S.A. (hereinafter referred to as “FCE” or the “Seller”).

Each of the parties acknowledges and agrees that all aspects of the performance by the parties
under the terms of this Contract, and all other dealings between the parties in connection
therewith, shall be governed by the principle of good faith and fair dealing. Further, each party
agrees that it will perform its functions under this Contract in cooperation with the other party
and in accordance with prevailing industry standards.

RECITALS:

WHEREAS, POSCO Power and FCE are parties to the Technology Transfer, Distribution and Licensing
Agreement (the “TTA”) and the Alliance Agreement (the “AA”), both executed as of February 7, 2007;

WHEREAS, POSCO Power and FCE are additionally parties to the Technology Transfer Program (“TTP”)
executed as of July 11, 2007;

WHEREAS, POSCO Power and FCE are additionally parties to the Contract for the Supply of DFC Plants
and DFC Modules from FuelCell Energy Inc. to POSCO Power (referred to hereunder as the “2008
Purchase Contract”) executed as of April 22, 2008;

WHEREAS, POSCO Power and FCE intend to enter into a new technology transfer agreement under which
FCE will grant a license to POSCO Power for the assembly and conditioning of DFC Modules
incorporating DFC Components (referred to hereunder as the “Module Assembly Technology Transfer
Agreement” or “MATTA”);

WHEREAS, POSCO Power and FCE additionally intend to execute a new technology transfer protocol
agreement describing detailed procedures for compliance with the terms of the MATTA (referred to
hereunder as the “Module Assembly Technology Transfer Program or MATTP”);

WHEREAS, the Buyer desires to purchase DFC Modules and DFC Components as described hereunder from
the Seller for the purpose of integration with Balance of Plant to be procured by the Buyer, either
from Seller or from independent third party vendors, for subsequent operation of the resulting
Plants, or for resale of the Plants to Third Party Owners, and associated installation the Plants
and the Equipment at the Site; and

WHEREAS, the Seller desires to sell the DFC Modules and DFC Components to the Buyer, and to provide
technical advisory services and other support services to the Buyer, in accordance with the terms
and conditions herein set forth; and

WHEREAS, the Seller and the Buyers acknowledge and agree that the Buyer may, without assuming any
obligations set forth in this Agreement and the other Transaction Agreements, assign its rights and
obligations to NewCo (which has the meaning assigned in the AA), subject to the requirements of
section

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17.1 hereunder. In the event of any other assignment of this Agreement by either party, the
assignee shall assume, in writing (in form and substance reasonably satisfactory to the other
party), the rights and obligations of the assigning party under this Agreement.

Now, THEREFORE, in view of the foregoing premises and in consideration of the mutual covenants and
undertakings hereinafter provided, the parties hereto agree as follows:

1. DEFINITIONS

Unless the context otherwise requires, the following words shall have the following meanings
assigned to them in this Article 1. Where the context requires, (i) words importing the
singular only also include the plural; (ii) words importing person(s) include corporations and
vice versa; (iii) references to statutes or regulations are to be construed as including all
statutory or regulatory provisions consolidating, amending or replacing the statute or
regulation referred to; (iv) the words “including”, “includes” and “include” shall be deemed
to be followed by the words “without limitation”; the words “will” and “shall” shall be deemed
to be interchangeable; and (v) references to agreements and other contractual instruments
shall be deemed to include all subsequent amendments, extensions and other modifications to
those instruments.

1.1
“Balance of Plant” or “BOP” shall have the meaning assigned in the TTA.

1.2
“Balance of Plant Skid” or “BOP Skid” means structural skid(s) with all BOP
components for the Power Plant with the exception of the Fuel Cell Module.

1.3 “Buyer’s Carrier” shall mean the freight forwarder engaged by Buyer at Buyer’s sole
discretion, to which Buyer shall assign responsibility for taking delivery of the Equipment.

1.4 “Buyer’s Receiving Site” shall mean a location in the same country as the Seller’s
Delivery Site for DFC Modules, Non-Repeating Components, and/or Repeating Components; and which
location shall otherwise be designated at the sole discretion of the Buyer.

1.5 “Consumables” shall mean the water treatment salts, catalysts, adsorbents, purge gases,
specialty gases, filters, gaskets, o-rings, fasteners and washers which are specified in the
Service Provider’s maintenance manual and necessary for the Power Plant to perform its functions.
Specifically excluded from the definition of “Consumables” are Utilities.

1.6 “Contract” means this contract and the Annexes hereto, the Specifications and all other
agreements and documents, including the amendments and supplements duly made hereto between the
Buyer and the Seller to ascertain the rights and obligations of the parties upon agreement.

1.7 “Contract Price” means the total amount to be paid by the Buyer to the Seller as
provided in Annex A hereof, which shall be subject to any valid adjustments made through the
application of the relevant provisions hereof.

1.8 “Commissioning Discontinuance” means the conditions that commissioning cannot be
proceeded to the next step due to improper conditions of the POSCO Plant itself and the POSCO Plant
operation.

1.9 “Delivery at Site” means delivery of the Plant and the Equipment, including all
drawings and other documents provided by the Seller at the Site pursuant to Article 8.1.2 of this
Contract.

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1.10 “DFC Components” means a quantity of Repeating Components (RC) and Non-Repeating
Components (NRC) from which a complete DFC Module may be assembled.

1.11 “DFC Power Plants” or “DFC Plants” means the complete power plants
manufactured by Seller at the facilities of Seller or its sub-vendors, including BOP and DFC
Modules.

1.12 “DFC Specifications” means the documents prepared by Seller containing performance
specifications for the DFC Plants.

1.13 “DFC Manuals” means the documents normally prepared and routinely provided by Seller
which contain, but are not necessarily limited to, instructions for installation, operation,
initial start-up, field procedures, instrumentation and controls, and maintenance of the DFC
Plants.

1.14 “POSCO Plant” or “Plant” shall mean the carbonate-based fuel cell power plant
which is manufactured by Buyer or POSCO Affiliate using the Direct FuelCell® technology of the
Seller .

1.15 “Engineer” means the person designated by the Buyer as engineer, with notification of
such designation being sent to the Seller, for the purpose of the inspection and testing stipulated
in Article 9 hereof, or in absence of such notification, the word Engineer means the Buyer or its
duly authorized representatives.

1.16 “Equipment” means the DFC Modules, Repeating Components, Non-Repeating Components, and
any machinery, equipment, apparatus, instruments, ship loose items, materials and other items which
are supplied by Seller pursuant to this Contract.

1.17 “Facilities” means the connections, interfaces, and supporting equipment for the
Plant, including the support system, slab or pedestal on which the Plant is located, fuel supply,
electrical distribution system, and equipment connected to the Plant’s interface points but
excluding the Plant itself.

1.18 “EXW” or “Ex Works” shall have the meaning assigned as published by the
United Nations Commission on International Trade Law in the “International Commercial Terms
(INCOTERMS 2000) “ as amended, except as may be otherwise provided herein.

1.19 “Force Majeure” shall mean unforeseen circumstances beyond the reasonable control and
without the fault or negligence of either party and which such party is unable to prevent or
provide against the exercise of reasonable diligence including, acts of God, any acts or omissions
of any civil or military authority, earthquakes, strikes or other labor disturbances, wars
(declared or undeclared), terrorist and similar criminal acts, epidemics, civil unrest and riots.

1.20 “Fuel Cell Module”, “DFC Module” or “Module” shall mean those
components manufactured by Seller, which comprise the fuel cell stack itself, including the stack
enclosure vessel, the fuel cell stack, ship loose items related to the module end post and its
supporting hardware, including individual fuel cells and cell assemblies, anodes, cathodes, current
collector plates, matrixes, manifolds, instrumentation, assembly and compression hardware and/or
the stack enclosure vessel, purchased by the Buyer pursuant to this Contract, the description and
the quantity of which are set forth in Appendix A to this Contract.

1.21 “DFC Module Components” or “DFC Components” shall mean one set of RC and NRC
components necessary for the assembly of one complete DFC Module.

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1.22 “Service Agreement” means a long term service agreement in respect of the Plant
between Seller and the Buyer or, in the case the Plant is resold to the Third Party Owner, among
Seller, Buyer (or its designee) and the Third Party Buyer.

1.23 “Site” means the land upon which the Plant and the Facilities will be located,
installed and erected in accordance with the specifications and requirements of which are set forth
in Appendix A (Specifications).

1.24 “Module Specifications” mean the Specifications attached to this Contract as Appendix
A.

1.25
“Non-Repeating Components” or “NRC” means parts and components of the DFC Modules
other than RC, necessary to assemble a DFC Module.

1.26 “POSCO Affiliate” shall have the meaning assigned in the AA.

1.27 “POSCO Plant Specifications” means the documents prepared by Buyer or POSCO Affiliate
which contain performance specifications for the POSCO Plant, as further described in paragraph
3.4.6 hereunder.

1.28 “POSCO Plant Manuals” means the documents prepared by Buyer or POSCO Affiliate which
contain instructions for installation, operation, and maintenance of the POSCO Plant.

1.29 “Pre-Shipment Tests” shall mean the testing procedures to be carried prior to delivery
from FCE facilities, as indicated in Article 9 hereunder.

1.30
“Repeating Components” or “RC” shall consist of discrete fuel cell packages assembled
from active components, excluding NRC, which are necessary for the assembly of DFC Modules.

1.31 “Seller’s Delivery Site(s)” shall mean the point of EXW delivery of the Equipment.

1.32 “Site Technical Advisory Services” means the services to be performed by the Site
Technical Advisors in connection with the installation, erection, commissioning and acceptance test
of the Equipment in accordance with Article 5 hereof.

1.33 “Site Technical Advisors” means the persons authorized by the Seller to perform the
Seller’s obligations regarding the Site Technical Advisory Services under the Contract.

1.34 “Target Date” means, the day on which, in accordance with the construction schedule,
the POSCO Plant/Facilities are to be put into initial operation.

1.35 “Third Party Owner” means any company or other entity that purchases the Equipment
from the Buyer and operates the Facilities at the Site.

1.36 “Utilities” shall mean air, water, wastewater, fuel and electric startup power
required to operate the Power Plant.

2. EFFECTIVE DATE OF CONTRACT

The Contract shall become fully effective and binding upon both parties hereto on the date (the
“Effective Date”) this Contract is executed by their duly authorized representatives.

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3. SCOPE OF CONTRACT

3.1 The division of responsibility between Seller, Buyer and POSCO Affiliate for the manufacture,
testing, and warranty of the DFC Plants and POSCO Plants for which equipment shall be supplied
under to this Agreement, shall be as described in this section.

Manufacturing Category 3 (MC-3): Shall be as described in the 2008 Purchase Contract.

Manufacturing Category 4 (MC-4): Seller Supplies DFC Module Components, Buyer and/or POSCO
Affiliate assembles DFC Module Components into DFC Modules under separate license from Seller,
POSCO Affiliate supplies BOP. In this stage Buyer and/or POSCO Affiliate will establish a facility
in Korea for stack assembly and conditioning activities to complete the manufacture of DFC Modules
using DFC Module Components and technical assistance provided by Seller.

3.2 [Reserved]

3.3 Responsibilities of the Parties Under Manufacturing Category 3 (“MC-3”) shall be as described
in section 3.3 of the 2008 Purchase Contract.

3.4 Responsibilities of the Parties Under Manufacturing Category 4 (“MC-4”)

3.4.1 The Seller agrees to sell the DFC Components as set forth in Annex A hereunder, and the Buyer
agrees to purchase and take delivery of the DFC Components according to the schedule indicated in
Annex A. In addition, the Seller shall provide the following materials, parts, documents, supplies,
assistance, support and advisory services as specifically set forth herein:

	 	A.	 	Design, engineer, and manufacture the DFC Components, in the quantities and shipped to
Buyer according to the schedule indicated in Annex A, conforming to the DFC Components
Specifications provided in Appendix B;

	 	B.	 	Transfer technology and provide technical assistance in accordance with the MATTA and the
MATTP for the assembly and conditioning of DFC Modules using DFC Components purchased from
Seller;

3.4.2 As a prerequisite of Seller’s guarantees under Paragraphs 3.4.4 and 3.4.5 hereunder, all work
performed by Buyer in the procurement of BOP components and in the assembly and test of DFC Modules
shall be performed in accordance with Seller drawings, manufacturing practices, instructions and
quality plans; and all variations therefor which may have an impact on performance shall be subject
to prior written approval by Seller. Failure to strictly adhere to the above requirement shall void
Seller’s warranties.

3.4.3 During all stages of manufacture of DFC Modules by Buyer, Seller shall have the right to have
its technical representative(s) present at Buyer’s Plant for the purpose of inspecting the
materials used and the work performed by Buyer. The Seller technical representative(s) shall have
the right to reject and require correction of any work and procedures which do not meet Seller
quality standards. The performance of the aforesaid functions by the Seller technical
representative(s) shall in no way relieve Buyer of its obligations under this Agreement.

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3.4.4 With respect to DFC Components provided to Buyer by Seller under this Agreement, Seller shall
be responsible to Buyer as set forth hereunder. In the event that the results of tests made under
conditions to be agreed upon in advance between Seller and Buyer indicate that any DFC Components
manufactured and assembled into a complete DFC Module by Buyer under this Agreement, fails to
perform as stipulated by Seller in Appendix B, and if any such failure is due solely to the
improper performance of components supplied by Seller, then Seller’s sole responsibility to Buyer,
and Buyer’s sole remedy, shall be as set forth in the performance guarantee described in section
9.2, and the warranty referred to in Article 10.

3.4.5 With respect to each DFC Module assembled by Buyer incorporating DFC Components manufactured
by Seller, and consistent with the provisions of section 7.1(vi) of the TTA, Seller shall be
responsible to Buyer as set forth hereunder. In the event that the results of tests made under
conditions to be agreed upon in advance between Seller and Buyer indicate that any DFC Module fails
to achieve the performance levels indicated by the DFC Module Specifications provided in Appendix A
of this Contract, and if any such failure is due solely to incorrect drawings or data furnished and
specified to Buyer by Seller, then Seller’s sole responsibility to Buyer, and Buyer’s sole remedy,
shall be to furnish corrected drawings or data to Buyer, and to consult with Buyer with respect to
correcting the performance of the DFC Module. In the event that the Parties are not able to agree
as to the cause of failures, then the procedures outlined in Article 15 hereunder shall apply.

3.4.6 In no event shall Seller’s liability under this Article exceed the price of the DFC
Components paid by Buyer to Seller for the POSCO Plant involved.

3.4.7 Seller’s Responsibility Under End User Long Term Service Agreements.

	 	A.	 	DFC Modules Manufactured by Seller: Seller’s obligations for complete DFC Modules
manufactured by Seller shall be as described in the 2008 Purchase Contract.

	 	B.	 	DFC Modules Assembled by Buyer from DFC Components Supplied by Seller: For DFC
Modules assembled by Buyer and/or POSCO Affiliate from DFC Components supplied by Seller,
Buyer shall be responsible to the end user for warranty, performance guarantees, and service
obligations related to the DFC Modules. Seller shall have no obligations under the service
agreements which Buyer may execute with end users, beyond the performance guarantee
described in section 9.2, and the warranty referred to in Article 10.

3.5 General Conditions

3.5.1 The Parties may change the designation of manufacturing categories shown in Annex A, by
mutual agreement, up to the time of material purchasing.

3.5.2 The Seller’s services, including its design and engineering services, shall be performed (i)
with care and diligence, (ii) in accordance with generally accepted international professional
standards, and (iii) as expeditiously as is consistent with the preceding standards of professional
skill, care and diligence. The Seller represents, covenants and agrees that all persons who will
perform or be in charge of the professional, architectural and design work under the Contract shall
have experience with a type of project similar to the Facilities and that whenever required by
applicable law, such persons shall be licensed to practice under such law.

3.5.3 Independent Contractor. In performing its duties and obligations hereunder, the Seller
shall, at all times, act in the capacity of an independent contractor, and shall not in any respect
be deemed (or act as) an agent of the Buyer, except as otherwise provided under this Contract.

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3.5.4 Seller agrees to provide Documentation (Seller’s operating instruction manuals, drawings,
graphs, tables, exhibits and other documentation) in metric units to the extent available and in
use at Seller’s factory.

3.5.6 Buyer shall be responsible for establishing the POSCO Plant Specifications and the POSCO
Plant Manuals. Buyer agrees that the POSCO Plant Specifications and Manuals shall use as a guide
the DFC Specifications and Manuals. Buyer additionally agrees that the POSCO Plant Specifications
and Manuals shall not exceed the performance levels established in the DFC Specifications and
Manuals, nor shall such POSCO Plant Specifications and Manuals allow operating conditions any less
stringent than contained in the DFC Specifications and Manuals, without the prior written approval
of Seller.

4. CONTRACT PRICE AND PAYMENT TERMS

4.1 The Contract Total Price set forth in Annex A covers the Scope of Contract set forth in
Article 3 above.

4.2 Expected Output. The expected MW output rating for the DFC Modules and DFC
Components to be sold to Buyer under this Contract is shown in Annex A. Seller expects to introduce
new technology resulting in an increase in power output per Module from 1.2 MW to 1.4 MW beginning
with shipments commencing in 2009. In the event that the increase in power output from 1.2 MW to
1.4 MW is not achieved according to the anticipated schedule, Seller and Buyer agree that the
pricing indicated in Annex A will be adjusted proportionally to reflect the increase or the
shortfall in output.

4.3 Payment Terms

4.3.1 Initial Downpayment. Buyer agrees to make a downpayment to Seller in the amount of
10% of the Contract Total Price indicated in Annex A, which shall be received by Seller within 30
days after the Effective Date.

4.3.2 Payments for DFC Modules and DFC Components sold to Buyer as indicated in Annex A, shall be
made by the Buyer to the Seller in accordance with the following schedule:

	 	A.	 	The first payment in the amount of ten percent (10%) of the price of individual DFC
Modules or DFC Components shall be allocated from the Initial Downpayment.

	 	B.	 	The second payment in the amount of twenty percent (20%) of the price of individual DFC
Modules or DFC Components shall be invoiced at time of Seller’s actual material order, but
no sooner than five(5) months after the Effective Date of this Contract.

	 	C.	 	The third payment in the amount of twenty percent (20%) of the price of individual DFC
Modules or DFC Components shall be invoiced twelve (12) weeks prior to EXW shipment date.

	 	D.	 	The fourth payment in the amount of twenty-five percent (25%) of the price of
individual DFC Modules or DFC Components shall be invoiced four (4) weeks prior to EXW
shipment date.

	 	E.	 	The fifth payment in the amount of twenty-five percent (25%) of the price of individual
DFC Modules or DFC Components shall be invoiced at the EXW shipment date.

4.4 Payment Default Rate. Payments invoiced by Seller shall be due within 30 days after
the date of invoice. In the event that any payment due from Buyer under this Contract is not paid
when due, Buyer shall pay Seller interest on such overdue payment during a period commencing on
such due date until the date that such overdue payment is actually made to Seller, the annual rate
of interest being equal to two percent (2%) above the highest commercial prime rate as published in
the Wall Street Journal on the day the payment first became due. Nothing in this paragraph shall
prevent the Seller from exercising other remedies available under this Contract.

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5. TECHNICAL ADVISORY SERVICES

5.1 Buyer acknowledges that technical advisory services provided by the Seller are not
included in the price indicated in Annex A. Seller agrees to provide a reasonable amount of such
services at the request of Buyer, subject to payment by Buyer at Seller’s then current per diem
rates, and otherwise subject to the provisions of the MATTA.

6. DELIVERY; TITLE TRANSFER; INSPECTION

6.1 Delivery.

6.1.1 Shipment Terms for the Equipment. Seller agrees to supply, and Buyer agrees to purchase,
the Equipment in the quantities and prices as indicated in Annex A hereunder, on the basis of EXW
Seller’s Delivery Sites. For the avoidance of doubt, Seller shall be responsible for crating and/or
otherwise preparing the Equipment for shipment in compliance with Article 7 of this Contract; and
the cost for preparing the Equipment for such shipment is included in the pricing as indicated in
Annex A hereunder.

6.1.2 Shipment in Place. In the event that Buyer’s Carrier has not been designated by Buyer or
otherwise is unready to take delivery of the Equipment on the EXW delivery dates as indicated in
Annex A, Seller may ship any such shipment in place, or ship to storage at Buyer’s expense; and,
Buyer agrees to make payments for such shipments according to the payment schedule indicated in
Article 4 hereunder.

6.1.3 Designation of Seller’s Delivery Sites. Seller agrees to notify Buyer within 60 days
after the Effective Date of this Contract, of the Seller’s Delivery Sites for the Equipment. The
Seller’s Delivery Sites shall not exceed four (4) physical locations (including the location(s) in
FuelCell Energy Site in Connecticut). Any and all deliverables to the Buyer shall be shipped to
such four (4) locations at Seller’s expense. After the execution of this Contract, the parties
shall negotiate in good faith to minimize any inland shipping expenses and ensure the quality of
the Equipment during the inland shipping.

6.1.4 Additional Shipping Services. At the request of Buyer, Seller agrees to provide
additional shipping services to Buyer, including trucking and insurance services necessary to
transport the Equipment from the Seller’s Delivery Site to the Buyer’s Receiving Site. For the
avoidance of doubt, such additional shipping services are not included in the pricing indicated in
Annex A, and shall only be arranged by Seller upon receipt of written request from Buyer, which
shall include costs which Buyer shall reimburse to Seller upon completion of the additional
shipment services.

6.1.5 Partial shipments shall be permitted.

6.1.6 If either the Buyer or the Seller wishes to adjust the delivery schedule set forth in
Annex A, the parties shall, after agreeing to an appropriate price adjustment in a good faith and
commercially reasonable manner, cooperate to adjust the delivery schedule.

6.1.7 Liquidated Damages for Delayed Delivery. In the event the EXW delivery date of
the Equipment is delayed more than 30 days beyond the EXW shipment dates indicated in Annex A,
solely through the fault of the Seller, and unless the parties mutually agreed to an extension
thereto, the Buyer is entitled to claim liquidated damages per day of delay in an amount equivalent
to 0.15% of the price for the delayed Equipment. Such liquidated damages shall not exceed five
percent (5%) of the price of the affected unit(s). In the event that the liquidated damages under
this section reach 5% of the price of the affected unit(s), Buyer shall have recourse to Article
16.4 below. Prior to implementing the provisions of Article 16.4 pursuant to this section, Buyer
agrees that it shall discuss with Seller alternate remedies in good faith.

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6.3 Communication

6.3.1 The Seller shall provide to the Buyer, by facsimile or email, the information necessary
for the Buyer’s vessel arrangement and necessary insurance pursuant to Article 6.6 at least 40 days
prior to each shipment, including the name of Equipment, the approximate number of packages, total
weight and measurement, the loading date, the loading port and other pertinent information
(including information for customs clearance and inland transportation). The Buyer shall inform, by
email or telefacsimile, the Seller of the status of vessel arrangement seven (7) days prior to the
date of shipping.

6.3.2 The Seller shall, immediately after the completion of each shipment, notify the Buyer by
facsimile or email of the contents of cargo shipped and expected date of arrival and other
pertinent information.

6.4 Title Transfer. Title to the Equipment and risk of loss shall transfer to Buyer at the
time EXW delivery is completed at the Seller’s Delivery Site, provided, that nothing in
this Contract shall (i) limit the Buyer’s right to reject defective or deficient Equipment or (ii)
otherwise limit the Buyer’s rights under Articles 9 and 11.

6.5 Inspection; Rejection

6.5.1 The Seller or its designated representative shall inspect the Equipment at the loading
port for quality assurance. The Buyer will have the right to be present at the time of such
inspection, and the Seller shall provide Buyer with reasonable prior notice of any such inspection.

6.5.2 The Buyer may reject from any shipment any Equipment which is defective or deficient, or
which does not otherwise conform to the Specifications.

6.6 Insurance. Seller shall bear the cost of insuring the Equipment prior to the time that
it passes the ship’s rail in the loading port. Buyer shall bear the cost of insuring the Equipment
from the time that it passes the ship’s rail in the loading port.

7. PACKING

7.1 The Equipment to be shipped to the Buyer shall be packed and shipped in accordance with the
Specifications and if not specified therein, shall be packed in sea-worthy packing conditions
according to usual international commercial and industrial practice; that is, the packing of the
DFC Modules and DFC Components shall utilize proper anti-corrosion and/or anti-rust compounds or
coatings and protective water proof wrapping and/or packing as the case may be. In case of wood
packaging materials, the Seller shall comply with the quarantine requirements set forth in Article
7.3 hereof. Such packing shall be sufficiently strong including skids so that it will not break or
fall apart under normal handling.

Interior blocking, bracing and cushioning shall be provided where necessary to absorb shocks,
prevent rattling and relieve destructive forces. Additionally the Equipment should have proper
devices on it to record any shock during transportation. Packing containing fragile materials
should be so marked in bold stout letters.

In accordance with good packing practices, the Equipment shall be packed in the smallest possible
approved containers since steamship freight is usually based on cubic measurements.

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7.2 Marking shall include the following information and any other information reasonably requested
by Buyer:

	 	A.	 	For: POSCO Power;

	 
	 	B.	 	Contract number or name of Contract;

	 
	 	C.	 	Port of destination;

	 
	 	D.	 	Item number, package number in sequence and quantity per package;

	 
	 	E.	 	Commodity description;

	 
	 	F.	 	Net weight, gross weight, dimension and cubic measurement;

	 
	 	G.	 	Shipper’s marks;

	 
	 	H.	 	Origin of the Equipment/Port of Export;

	 
	 	I.	 	Caution marks, if necessary; and

	 
	 	J.	 	Shipping mark.

7.3 Wood Packaging. In case of wood packaging materials, the following conditions should
be met:

The Quarantine Requirements on Wood Packaging Materials of Imported Consignments
Respective packing list shall be attached on each wood packing container.

	 	•	 	Regulated Articles: All non-manufactured wood packaging materials such
as pallets, crating, dunnage, packing blocks, etc.

	 	•	 	Exempted Articles: Manufactured wood packaging materials such as
plywood, particle board, oriented strand board, veneer, etc.

	 	•	 	Regulated Areas : All countries.

	 	•	 	Requirements: All imported wood packaging materials should be treated by
following methods, and present the mark which certifies the approved
treatment on two opposite sides of the article.

	 	•	 	Treatment methods : Heat Treatment (HT) or Methyl Bromide (MB)
fumigation according to the Annex I of ISPM No. 15.

ISPM 15 mark

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	 	•	 	The mark should contain the valid symbol approved by IPPC, country code, unique
number of the producer/treatment facility assigned by the NPPO of exporting countries,
treatment methods (HT, MB).

	 	•	 	Only HT is accepted as a proper treatment for coniferous wood packaging materials
from pine wood nematode distributed countries.

	 	•	 	Subjected countries : Japan, China, Taiwan, US, Canada, Mexico, Portugal,
Vietnam (pine wood)

	 	•	 	Non-compliance Measures

Treatment, Disposal or Return to the origin at the expense of the Seller.

7.4 In case that special arrangements are required for unloading, packing, handling, storage and
operation of the Equipment, Seller shall recommend to Buyer the required method and procedures
to facilitate Buyer’s suitable arrangement. In that case Buyer may, if necessary, establish
the method and procedures under consultation with Seller.

8. DRAWINGS AND DOCUMENTS

The Seller shall provide to the Buyer:

	 	A.	 	In the case of manufacturing category MC-4, appropriate drawings, reports,
guidelines, manuals, programs, software, and data which are described in the MATTA and
the MATTP for assembly of the DFC Components into DFC Modules;

	 
	 	B.	 	All drawings, manuals and reports shall be complete, neat and legible, for the
purpose of their use to permit adequate review, and operation as applicable;

	 
	 	C.	 	All drawings, manuals and reports shall be in accordance with the
Specifications provided in Appendix A.

9. PERFORMANCE GUARANTEES AND ACCEPTANCE TESTS

9.1 Standard Pre-Shipment Factory Inspection and Testing Procedures

9.1.1 Pre-Shipment Factory Test Procedures for DFC Modules. The Seller agrees to
provide 30 days advance written notice to Buyer for pre-shipment testing of Modules to be shipped
to Buyer pursuant to this Contract. The Seller also agrees to provide written procedures
documenting the Seller’s standard pre-shipment factory test for DFC Modules.

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The Seller shall conduct normal and standard tests of all materials and the workmanship of all
DFC Modules to be supplied under this Contract in accordance with Seller’s standard pre-shipment
factory test for DFC Modules. Seller shall prepare a Test Report documenting results of the
standard pre-shipment factory test for DFC Modules, documenting pass/fail status for each Module as
compared with standard acceptance test criteria. The Engineer shall be entitled, at all reasonable
times, to witness the Test and to inspect the procedures and results of the Test for the Modules to
be supplied under the Contract, and to inspect the packing and marking of such Equipment. The
Engineer(s) have the right to reject the failed DFC Stack Module as per the test results. One copy
of the Test Report for each Module provided pursuant to this contract shall be supplied to Buyer
prior to shipment. A standard form of the Test Report is included hereunder as Appendix C. Such
inspection, examination or testing, if made, shall not relieve the Seller from any obligations
under the Contract.

9.1.2 Pre-Shipment Factory Inspection Procedures for DFC Components. The Seller agrees
to provide 30 days advance written notice to Buyer for pre-shipment inspection of Repeating
Components to be shipped to Buyer pursuant to this Contract. The parties shall negotiate in good
faith to agree on the standard pre-shipment factory inspection procedures for DFC Components which
will be included in the MATTA.

The Seller shall conduct normal and standard inspections of all materials and the workmanship
of all DFC Components to be supplied under this Contract in accordance with the standard
pre-shipment factory inspection procedures for DFC Components. Seller shall prepare an Inspection
Report documenting results of the standard pre-shipment factory inspections for DFC Components.
One copy of the Inspection Report for each set of DFC Components provided pursuant to this contract
shall be supplied to Buyer prior to shipment. A standard form of the Inspection Report is included
hereunder as Appendix D. Such inspection, examination or testing, if made, shall not relieve the
Seller from any obligations under the Contract.

9.2 Performance Guarantee for DFC Modules and DFC Components

9.2.1 The guaranteed power output and efficiency for the POSCO Plant final acceptance test at the
customer site (“FA Test”) shall be set forth in the POSCO Plant Specifications. If after repeated
FA Tests over a period of six (6) months from the first FA Test, the POSCO Plant fails to achieve
the guaranteed power output and/or efficiency set forth in the POSCO Plant Specifications, for
causes solely attributable to the DFC Module or the DFC Components provided by Seller, but achieves
at least 95% of the guaranteed power output and/or efficiency, the Contract Price for the DFC
Module or DFC Components shall be reduced to reflect the shortfall in either the power output or
the efficiency proportionally, whichever shortfall amount is higher.

9.2.2 Liquidated Damage. In the event the POSCO Plant fails to achieve at least 95% of the
guaranteed power output and/or efficiency solely due to the fault of the DFC Module or DFC
Components after repeated FA tests, Seller shall notify Buyer in writing of the reason for such
failure. If the reason is solely attributable to causes related to DFC Module or DFC Components
provided by Seller, then Seller shall have a period of six (6) months from the first FA test to
take necessary corrective actions and repeat the FA test to achieve greater than 95% of the
guaranteed power output and/or efficiency. If at the end of such time period 95% of the guaranteed
power output and/or efficiency is still not achieved, then Buyer shall have recourse to Article
16.1 below.

9.2.3 Additional Liquidated Damage Applicable Only to DFC Modules Wholly Manufactured by
Seller. In the event that during the commissioning period, excluding the FA test, the
commissioning of the POSCO Plant is discontinued due to causes solely attributable to defects of
DFC Modules wholly

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manufactured by Seller, the Buyer is entitled to claim liquidated damages per day of Commissioning
Discontinuances in an amount equivalent to 0.15% of the price for the total Equipment (e.g in case
of 2.4 MW plant, the total equipment is two DFC Modules) provided by Seller. The total amount of
liquidated damages payable by Seller to Buyer under this paragraph shall not exceed five percent
(5%) of the price of the total Equipment. In the event of Commissioning Discontinuance caused by
the defects of DFC Modules wholly manufactured by Seller, Seller should exercise commercially
reasonable efforts to eliminate the defects at Seller’s own cost; and Buyer shall support Seller to
eliminate defects in the most efficient manner. Seller shall provide Buyer with action plans, root
causes and corrective actions before and after taking actions.

10. WARRANTIES

10.1 Warranties Against Defects, Etc. The Seller warrants, for a period of eighteen (18)
months from the date of EXW shipment, or twelve (12) months from the date of first operation at the
installation site, whichever occurs first, that (i) the DFC Modules and DFC Components to be
delivered hereunder shall be free from defects in material and workmanship; and (ii) the DFC
Modules and DFC Components conform to the DFC Module Specifications and DFC Component
Specifications and other requirements set forth in this Contract. If the DFC Modules experience
reduction in power output below 90% of rating, averaged over any consecutive 30-day period during
the warranty period, for causes solely attributable to Seller, Seller shall use its reasonable best
efforts to take corrective actions as provided by the warranty provisions hereunder, to increase
the average power output above 90% of rating.

10.2 Remedies for Breach of Warranties Against Defects, Etc.

10.2.1 If any DFC Modules or DFC Components delivered do not meet the warranties set forth in
Article 10.1 during the warranty period, the Buyer shall promptly notify the Seller in writing.
The Seller shall, at its own expense and cost, correct the defects by: (i) repairing the defective
parts of the Equipment, (ii) replacing the defective parts if repair is impossible; or (iii)
providing an equitable adjustment of the Contract Price. For the avoidance of doubt, the Seller
shall bear all costs and expenses incurred in connection with any of the above corrective measures,
including customs clearance at a Korean port, inland transportation from the port to the Site and
field labor.

10.2.2 If the Seller does not commence the correction of such defects within 30 days from the
date of receipt of notice from the Buyer, and Seller’s acceptance of such notice, or does not
complete the said correction with reasonable diligence and within a reasonable time, the Buyer may,
at its option, correct the defects at the Seller’s risk and expense. The Seller shall reimburse the
expense incurred by the Buyer for remedy of such defects within thirty (30) days from the date of
receipt of the Buyer’s invoice.

10.3 Downtime Warranty. If a complete DFC Module wholly manufactured by Seller is forced to
continuously or intermittently decrease power output below 50% of the power output at final
acceptance (“Downtime”), and if such Downtime is due to causes solely attributable to Seller, then
Seller shall be subject to liquidated damages as outlined in this section.

	 	(A)	 	In the event that the cumulative number of days of Downtime for the DFC Module
exceeds forty-five (45) days during the warranty period, Seller shall pay to Buyer an
amount of zero point one percent (0.1%) of the applicable individual unit price as
indicated in Annex A, for each day of such Downtime exceeding forty-five days as
liquidated damages. Liquidated damages for Downtime pursuant to this section shall not
exceed ten percent (10%) of the applicable individual unit price as indicated in Annex
A. Seller agrees to pay such liquidated damages within thirty (30) days after receiving
Buyer’s invoice reflecting such claims. Buyer

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	 	 	 	agrees that the Liquidated damages shall not be duplicated with the Liquidated damages
of the Performance Guarantee of LTSA. During the Warranty period, only the Liquidated
damages of Downtime shall be applied.

	 	(B)	 	Any Downtime attributable in part or in full to the following causes shall not
be considered as Downtime attributable to Seller: (i) corrections, modifications and
repairs undertaken pursuant to Seller’s maintenance obligations; (ii) causes not
attribute to Seller which delay commencement or execution of corrective measures; (iii)
causes which cannot clearly be identified or proven by the Parties; (iv) failure of the
Third Party Owner to comply with the Specifications, Manuals, or with the conditions of
the warranty; or outage time wholly or partially due to causes beyond the reasonable
control of the Seller.

10.4 General Warranty Provisions

10.4.1 Title Warranty. Seller shall warrant that the Plant(s) and any Equipment and
related services are delivered hereunder free from any and all rightful, legitimate and proven
claims, demands, liens and/or encumbrances of title. If any failure to comply with this warranty
appears at any time, Buyer will give prompt written notice to Seller, and Seller shall defend the
title thereto and save Buyer harmless from or reimburse all losses, damages and liabilities of
every kind, arising in connection with such failure. This warranty shall be extended during the
period of such title defense without limit as to time.

10.4.2 Assignment of Warranty. This warranty may be assigned by the Buyer to the Third
Party Owner upon final sale, provided that the terms of the warranty shall be determined in
accordance with this Article without regard to any such sale.

10.4.3 Seller shall not be responsible for removal or replacement of any structure or part of the
Facility required to perform Seller’s warranty obligations under this Contract.

10.5 The Seller does not warrant the DFC Module or DFC Components or any repaired or replacement
parts against normal wear and tear including that due to expected degradation in accordance with
the Module Specifications, environment or operation, including excessive operation at peak
capability, frequent starting/stopping, type of fuel, or erosion, corrosion or material deposits
from fluids. The warranties and remedies set forth herein are further conditioned upon (i) the
proper storage, installation, operation, and maintenance of the Module and conformance with the
Module Specifications and instruction manuals (including revisions thereto) provided by the Seller
and/or its subcontractors; (ii) the proper operation and maintenance of the POSCO Plant in
accordance with the POSCO Plant Manuals, or in the absence of such POSCO Plant Manuals, the DFC
Plant Manuals as applicable; and (iii) repair or modification pursuant to Seller’s instructions or
approval. Buyer shall keep proper records of operation and maintenance during the warranty period.
These records shall be kept in the form of logsheets and copies shall be submitted to Seller upon
its request. Seller does not warrant any equipment or services of others designated by Buyer where
such equipment or services are not normally supplied by Seller.

10.6 The Seller shall have no obligation to correct, repair and/or replace the DFC Plants, DFC
Modules, DFC Components, or any Equipment to the extent a defect or non-conformance is the result
of improper assembly, installation or damage resulting from the Buyer’s failure to comply with the
Specifications, instructions and documentation regarding installation, operation and maintenance of
the Module.

10.7 Changes, modifications or alterations by the Buyer or its vendors, suppliers, employees or
agents, to the Buyer Plant or its components provided herein, without the written approval of
Seller, shall void all

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Seller’s obligations and warranties hereunder, and may void third party equipment certifications,
including safety, environmental and interconnection.

10.8 Exclusive Remedy. Except as otherwise set forth herein, the remedies set forth in
this Article 10 are the exclusive remedies for all claims based on failure of or defect in the
Equipment provided under this Contract, whether the failure or defect arises before or during the
warranty period and whether a claim, however instituted, is based on contract, indemnity, warranty,
tort (including negligence), strict liability or otherwise. THE FOREGOING WARRANTIES ARE EXCLUSIVE
AND ARE IN LIEU OF ALL OTHER WARRANTIES AND GUARANTEES WHETHER WRITTEN, ORAL, IMPLIED OR STATUTORY.
NO IMPLIED STATUTORY WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE SHALL APPLY.

11. LIMITATION OF LIABILITY

11.1 Each party (Indemnitor) agrees to indemnify and hold harmless the other party (Indemnitee)
from and against any and all losses, obligations, liabilities, damages, claims which may be
asserted against or sustained or incurred by the Indemnitee arising out of or related to any breach
of any of the representations, warranties, agreements and covenants made by Indemnitor in this
Contract; any bodily injury or death suffered by anyone; any property damage of any third parties;
or any wrongful and negligent act of Indemnitor that occurs under this Contract, in an amount not
to exceed such plant’s Contract Price; provided, any claim under Section 15.1 shall not be subject
to any such limitations set forth in this Article 13.1. In no event, whether as a result of breach
of contract, warranty, tort (including negligence), strict liability, indemnity, or otherwise,
shall either party or its subcontractors or suppliers be liable to the other party for loss of
profit or revenues, loss of use of the Plant or any associated equipment, cost of capital, cost of
substitute equipment, facilities, services or replacement power, claims of Indemnitor’s customers
for such damages, or for any special, consequential, incidental, indirect or exemplary damages.

If Seller furnishes Buyer with advice or assistance concerning any products, systems or work which
is not specifically required by the Specification, the furnishing of such advice or assistance will
not subject Seller to any liability, whether in contract, indemnity, warranty, tort (including
negligence), strict liability or otherwise.

11.2 If Buyer transfers title to the Facilities to a third party, Buyer shall obligate such third
party to be bound by the provisions of this Article to the same extent as Buyer is obligated. In
the event Buyer cannot obtain the foregoing for Seller, Buyer shall indemnify, defend and hold
Seller harmless from and against any and all claims described in the preceding paragraphs of this
Article made by any such third party against Seller.

11.3 The provisions of this Article shall prevail over any conflicting or inconsistent provisions
contained in any of the documents comprising this Contract, except to the extent that such
provisions further restrict any party’s liability.

12. COSTS AND CHARGES

12.1 In case the repair, making good, replacement or modification is required hereunder, the Seller
shall at its own expense make available at the Site the replacement parts necessary for the
performance of the above.

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12.2 In the event that non-commercial cargo must be shipped due to reasons attributable to Seller’s
error, e.g. errors in preparation of transport documents, or incorrect negotiation against the
transport documents; the Seller shall deliver such cargo to the Site and shall pay all costs
including the ocean freight, premium, expenses for inland transportation to the Site, importation
taxes, and custom duties.

12.3 In case any vessel arrangement made by the Seller without prior consent by or consultation
with the Buyer, the Seller shall bear all associated costs and expenses including the ocean and/or
air freight. In cases where Buyer is arranging shipment of equipment, Seller agrees to submit to
Buyer in a timely manner the packing lists necessary for Buyer to arrange ship and/or shore cranes.

13. PATENTS, INTELLECTUAL PROPERTY AND CONFIDENTIALITY

13.1 The Seller shall indemnify and hold the Buyer or the Third Party Owner, its employees,
engineers and agents harmless against all proximate costs, actions, claims and demands brought by a
third party by reason or in consequence of any infringement by the Module or parts thereof, or by
the use of process that have been supplied by the Seller as a result of engineering services, any
patent, design patent, trade mark or copyright.

13.2 In the event that any claim is made or action is brought against the Buyer or the Third Party
Owner, including its employees, engineers and/or agents, relating to such infringement, the Buyer
shall promptly notify the Seller thereof and the Seller at its expense and option may request the
assistance of the Buyer and shall conduct, on behalf of the Buyer all negotiations for settlement
of such dispute or litigation as may arise therefrom.

13.3 If, in such a suit or proceedings, the Module or parts thereof are held to constitute an
infringement and the use thereof is enjoined, Seller promptly shall, at its option and expense,
either procure for Buyer the right to continue using such Module, or replace such infringing Module
with non-infringing Module which are equal to or better than the previous Module, or modify the
infringing Module so that they become non-infringing without impairing the quality, performance or
any guarantee on the original Module, provided, however, that nothing contained herein shall be
deemed to relieve Seller from its warranty obligations under the Contract.

13.4 Intellectual property and confidentiality

A. Terms and conditions for ownership of intellectual property will be according to Article
III of the TTA.

B. Use of Confidential Information. Confidential Information may be exchanged between the
parties in accordance with Article XI of the TTA.

C. FCE Fuel Cell Stack Module Integrity. The provisions of Section 2.6(e) of the AA shall
apply to all Fuel Cell Stack Modules provided hereunder.

14. FORCE MAJEURE

14.1 Should either party be prevented wholly or in part from fulfilling any of its obligations
under the Contract for reasons of force majeure, such obligation shall be suspended to the extent
and for as long as such obligation is affected by Force Majeure and the party claiming under this
Article shall be entitled to

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such extension of time to fulfill such obligation as may be reasonably necessary in view of
circumstances, subject to the provisions of notifying the other by fax or email of the date when
such delay commenced, and reasons therefore within a reasonable period. The party so affected
shall try to use its commercially reasonable efforts to avoid or remove such causes of the force
majeure, and to complete performance of its obligations under the Contract with the reasonable
promptness whenever such causes are removed.

14.2 If, after ninety (90) days from the date of giving the aforesaid notice, the notifying party
shall still be prevented, for the reasons beyond its control, from continuing to perform its
obligations under the Contract, then either party shall be entitled to terminate this Contract,
without any liability to each other.

14.3 In the event of change in the Contract and/or termination of the Contract under Article 16.3
hereof, the Buyer and the Seller shall agree upon the costs to be borne by either party.

15. DISPUTES AND ARBITRATION

15.1 Any dispute, action, claim or controversy of any kind arising from or in connection with this
Contract (the “Dispute”) whether based on contract, tort, common law, equity, statute, regulation,
order or otherwise, shall be resolved as follows:

(i) Upon written request of any Party, the Parties shall meet and attempt to resolve any
such Dispute. Such meetings may take place via teleconference or videoconference. The
Parties shall meet as often as the Parties reasonably deem necessary to discuss the problem
in an effort to resolve the Dispute without the necessity of any formal proceeding.

(ii) Formal proceedings for the resolution of a Dispute may not be commenced until the later
of (i) the Parties concluding in good faith that amicable resolution through continued
negotiation of the matter does not appear likely; or (ii) the expiration of a sixty (60) day
period immediately following the initial request by either party to resolve the Dispute;
provided, however, that this Section will not be construed to prevent a party from
instituting formal proceedings earlier to avoid the expiration of any applicable limitations
period, to preserve a superior position with respect to other creditors or to seek temporary
or preliminary injunctive relief.

15.2 If the parties are unable to resolve any Dispute pursuant Section 15.1, shall be finally
settled under the Rules of Arbitration (the “Rules”) of the International Chamber of Commerce
(“ICC”) by three (3) arbitrators designated by the parties. Each party shall designate one
arbitrator. The third arbitrator shall be designated by the two arbitrators designated by the
parties. If either party fails to designate an arbitrator within thirty (30) days after the filing
of the Dispute with the ICC, such arbitrator shall be appointed in the manner prescribed by the
Rules. An arbitration proceeding hereunder shall be conducted in London UK and shall be conducted
in the English language. The decision or award of the arbitrators shall be in writing and is final
and binding on both parties. The arbitration panel shall award the prevailing party its attorneys’
fees and costs, arbitration administrative fees, panel member fees and costs, and any other costs
associated with the arbitration, the enforcement of any arbitration award and the costs and
attorney’s fees involved in obtaining specific performance of an award; provided,
however, that if the claims or defenses are granted in part and rejected in part, the
arbitration panel shall proportionately allocate between the parties those arbitration expenses in
accordance with the outcomes; provided, further, that the attorney’s fees and costs
of enforcing a specific performance arbitral award shall always be paid by the non-enforcing party,
unless the applicable action was determined to be without merit by final, non-appealable decision.
The arbitration panel may only award damages as provided for under the terms of this Agreement and
in no event may punitive, consequential and special damages be awarded. In the event of any
conflict between the Rules and any provision of this contract, this Contract shall govern.

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16. TERMINATION AND ASSURANCE

16.1 Termination by Breach

16.1.1 If either the Buyer or the Seller should substantially breach the provisions of this
Contract, which breach is not cured within sixty (60) days following receipt from the other party
of notice of such breach, the other party may, at its sole discretion, immediately terminate this
Contract by providing written notice of the party in breach. In addition, if there exist
reasonable grounds to doubt either the Buyer’s or the Seller’s ability to perform its obligations
under this Contract in full, then the other party shall have the right to demand assurances for
adequate performance. If no such assurances are provided within sixty (60) days of the request,
then the party demanding assurances may terminate this Contract on written notice to the other
party.

16.1.2 In the event of a payment-related material breach of this Contract by Buyer which extends
longer than thirty (30) days after the date payment is due, then Seller may, at its option and
subject to stay pending the outcome of any dispute resolution proceeding initiated pursuant to the
Article entitled “Disputes and Arbitration” hereunder, either (i) stop work, terminate the Contract
for breach and initiate suit for collection of outstanding balances; or (ii) stop work, invoice
Buyer in advance for all remaining payments due under this Contract, and continue performance of
this Contract upon receipt of such payments from Buyer, with appropriate schedule adjustments
needed for any delay;

16.2 The Buyer may terminate all or part of this Contract (or cancel any purchase orders) in the
event the parties, in their exercise of good faith and commercially reasonable efforts, fail to
enter into the MATTA within 60 days from the date hereof, unless such 60-day period is extended by
mutual agreement. In the event of termination (or cancellation) under this Section 16.2:

	 	(A)	 	Buyer acknowledges and agrees that the Initial Downpayment described in section
4.3.1 hereunder shall be non-refundable;

	 	(B)	 	Seller acknowledges and agrees that in the event that only part of the Contract
is terminated (or cancelled) pursuant to Section 16.2, the Initial Downpayment may be
used to set off any payments required for any portion of the Contract that is not
terminated (or cancelled) by the Buyer; and

	 	(C)	 	Seller further agrees that with the exception of the Initial Payment as
described in this Section, the Buyer shall not be liable for any costs incurred by the
Seller or any other payments required under this Contract.

16.3 When termination of the Contract due to the breach attributable to the Seller becomes
effective, Seller shall be responsible for direct costs and non-cancelable commitments (if
any) related to installation and assembly of the Module into a complete Plant, which is
incurred by Buyer prior to the date of termination. Buyer shall take all reasonable steps to
minimize termination costs. In no event, however, shall Seller be obligated to pay Buyer any
amount in excess of the total estimated costs up to the time of termination to support the
work.

16.4 In the event that the liquidated damage due to the delay in delivery of any Module(s) or any
Equipment under Article 6.1.4 has reached the maximum amount, then the Buyer may terminate
this Contract upon at least thirty (30) days’ written notice to Seller. In full discharge of
any obligations to Buyer in respect of this Contract and such termination, Seller shall refund
to Buyer all payments theretofore made to Seller. Buyer shall take all reasonable steps to
minimize Seller’s expenses and shall cooperate with Seller.

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17. ASSIGNMENT AND SUB-CONTRACTING

17.1 Neither party shall, without the consent in writing of the other party, which shall not be
unreasonably withheld, assign or transfer the Contract or the benefits or obligations thereof or
any part thereof to any person. Any such placing of sub-orders shall not relieve the Seller from
its obligations under the Contract.

18. TAXES AND DUTIES

18.1 The Seller shall pay all the taxes, charges, customs duties and tariffs for sale or export of
the Modules assessed or imposed on the Seller by the government or other competent authorities of
the Seller’s country in relation to the Contract, subject to the provisions of Article 6.1.1 above.

18.2 The Buyer shall pay and bear all the taxes, charges, customs, duties and tariffs for the
purchase or import of the Modules assessed or imposed on the Buyer by the government or other
competent authorities of the Republic of Korea in relation to the Contract.

18.3 In case the Seller is required to collect the VAT from the Buyer, the Seller shall invoice to
the Buyer. The Buyer shall then pay such VAT amount to the Seller within thirty (30) days after
receipt of the invoice, or shall reimburse the Seller within thirty (30) days after receipt of the
Seller’s invoice and evidence of payment in case the Seller is required to pay the VAT in advance.

18.4 The Buyer shall bear and pay any kind of taxes, charges and/or commissions (fees) levied on
the Seller by Korean Tax Authority in relation to the Modules and/or materials and related services
of the Seller. The Buyer shall bear any and all import duties and related taxes imposed by the
Korean Government on the imported Modules and/or Materials, and it shall be responsible for any and
all matters relating to customs clearance.

19. GOVERNING LAW

The Contract shall be governed, interpreted and construed under the laws of the State of New York.

20. LOCAL LAW COMPLIANCE

20.1 Local Law Compliance

20.1.1 The Seller shall comply with, and cause the Site Technical Advisors to comply with, all
applicable laws of the Republic of Korea and any political subdivision thereof, in the performance
of its duties under this contract in the Republic of Korea.

20.1.2 The Buyer shall be responsible for obtaining the necessary licenses, permits and
authorizations from the applicable Korean governmental authorities to perform its obligations under
this Contract.

20.1.3. The Buyer shall be responsible for obtaining all the permits, licenses and
authorizations required by the applicable Korean governmental authorities to perform its
obligations under this Contract. The parties acknowledge and agree that the FCE Technology (as the
term is defined in the TTA) is a new generating technology, with codes and standards still under
development; therefore, securing the applicable permits and other authorizations may require
significant interaction with and education of the applicable Korean regulatory authorities. The
Seller agrees to provide commercially reasonable cooperation to Korean regulatory authorities
pursuant to this section.

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21. ADDITION AND AMENDMENT

No modification, alteration, addition or change in the terms hereof shall be binding on the parties
hereto, unless it is reduced to writing in the English language and duly executed by the parties
hereto in the same manner as the execution of the Contract and subject to such government approval
as may be required under the applicable laws and regulations of the countries concerned.

22. NOTICE

All notices pursuant to this Contract including daily communication to be given to either party
will be deemed to have been duly given if delivered personally or by internationally recognized
courier service, or by facsimile, to the addresses set forth below. Either party may change its
address by giving prior notice to the other party in the same manner set forth hereinabove.

For the Buyer:

Commercial Matters

Mr. Tae-Hyoung Kim

Dept. Manager

Strategic Planning Department

POSCO Power

Posteel Tower 20th floor, 735-3, Yeoksam-dong

Gangnam-gu, Seoul 135-080, Korea

phone 82-2-3469-5950

facsimile 82-2-3469-5959

tahykim@poscopower.co.kr

Technical Matters

Mr. Ki Suk Chung

Dept. Manager / Ph. D.

Research & Development Department

POSCO Power

Posteel Tower 20th floor, 735-3, Yeoksam-dong

Gangnam-gu, Seoul 135-080, Korea

phone 82-2-3469-5966

facsimile 82-2-3469-5959

kisukch@poscopower.co.kr

For the Seller:

Mr. Ross Levine, Esq.

Director of Contracts

FuelCell Energy Inc.

3 Great Pasture Road

Danbury, CT 06813

phone 203 825 6000

facsimile: 203 825 6100

rlevine@fce.com

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23. ENTIRE AGREEMENT

The Contract sets forth the entire agreements and understandings between the parties as to the
subject matter of this Contract. It supersedes upon effectiveness of the Contract all prior
discussions, agreements and understandings of any and every nature between them.

24. PUBLICITY

Neither party shall engage in any advertising, sales promotion, press releases, public
announcements, articles for journals or any other publications, or presentation material for any
meeting, seminar or conference, or any other publicity matter relating to this Contract wherein the
name of the other party, its logo and/or trademark, or that of its parent company or any of its
affiliates is mentioned or otherwise identifiable; or wherein any aspect of this project is
mentioned or identified, without the prior written consent of the other party.

25. CONSEQUENTIAL DAMAGES

In no event shall either Party be liable to the other for any incidental, indirect, special or
consequential damages, however caused, and based on any theory of liability, arising out of or
related to the performance of this Contract.

26. INSURANCE

Each Party shall maintain the following insurance coverage written with carriers authorized to
insure risks at the Site location, with the other Party named as additional insured, providing
thirty (30) days written notification of cancellation:

27.1 Worker’s Compensation providing statutory limits and coverage and Employer’s Liability, in an
amount not less than $500,000 policy limit; and,

27.2 Commercial General Liability covering bodily injury (including death) and property damage in
an amount not less than One Million Dollars ($1,000,000) per occurrence; including Premises
Operations, Contractual Liability, Products and Completed Operations, and Broad Form Property
Damage.

27.3 Commercial Automobile Liability in an amount not less than One Million Dollars ($1,000,000)
combined single limit per accident, covering all owned, non-owned, leased, rented or hired autos
used in connection with the performance of this Contract.

27. COUNTERPARTS

This Contract may be executed by the parties hereto in separate counterparts, by facsimile or
electronically, each of which when so executed and delivered shall be an original, but all such
counterparts shall together constitute but one and the same instrument.

28. SEVERABILITY

In case any one or more of the provisions contained in this Contract is adjudged to be invalid,
illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not in any way be affected or impaired thereby, except to the
extent necessary to avoid an unjust or inequitable result.

29. WAIVER

CONFIDENTIAL

 

 

 

No waiver shall be deemed to have been made by any party of any of its rights under this Agreement
unless the same shall be in a writing that is signed on its behalf by its authorized officer. Any
such waiver shall constitute a waiver only with respect to the specific matter described in such
writing and shall in no way impair the rights of the party granting such waiver in any other
respect or at any other time.

IN WITNESS WHEREOF, the parties have executed this Contract on the day and year above written.

	 	 	 	 	 	 	 
	POSCO Power Corporation

	 	 	 	FuelCell Energy, Inc.	 	 
	 
	 	 	 	 	 	 
	 

Soung-Sik Cho

	 	 	 	 

R. Daniel Brdar
	 	 
	President & CEO

	 	 	 	President & CEO	 	 
	POSCO Power Corporation

	 	 	 	FuelCell Energy, Inc.	 	 

CONFIDENTIAL

 

 

 

ANNEX A

Equipment Description, Contract Price and Delivery Schedule

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	EXW Delivery	 	EWX Price	 	EWX Price
	Item #	 	Description	 	Date	 	(USD per kW)	 	(USD)
	1
	 	DFC Module (1.4MW)	 	01-Jan-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	2
	 	DFC Module (1.4MW)	 	01-Jan-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	3
	 	DFC Module (1.4MW)	 	01-Mar-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	4
	 	DFC Module (1.4MW)	 	01-Mar-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	5
	 	DFC Module (1.4MW)	 	01-Mar-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	6
	 	DFC Module (1.4MW)	 	01-Apr-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	7
	 	DFC Module (1.4MW)	 	01-Apr-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	8
	 	DFC Module (1.4MW)	 	01-Jun-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	9
	 	DFC Module (1.4MW)	 	01-Jun-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	10
	 	DFC Module (1.4MW)	 	01-Jun-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	11
	 	DFC Components Kit (1.4MW)	 	01-Aug-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	12
	 	DFC Components Kit (1.4MW)	 	01-Aug-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	13
	 	DFC Components Kit (1.4MW)	 	01-Sep-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	14
	 	DFC Components Kit (1.4MW)	 	01-Sep-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	15
	 	DFC Components Kit (1.4MW)	 	01-Oct-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	16
	 	DFC Components Kit (1.4MW)	 	01-Oct-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	17
	 	DFC Components Kit (1.4MW)	 	01-Nov-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	18
	 	DFC Components Kit (1.4MW)	 	01-Nov-10	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	19
	 	DFC Components Kit (1.4MW)	 	01-Jan-11	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	20
	 	DFC Components Kit (1.4MW)	 	01-Jan-11	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	21
	 	DFC Components Kit (1.4MW)	 	01-Feb-11	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	22
	 	DFC Components Kit (1.4MW)	 	01-Feb-11	 	 	*	 	 	 	*	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	Contract Total

    Price:	 	$	58,209,200.00	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 

 

 

APPENDIX A

Specifications for DFC® Stack Modules

C1400 Stack Module Specification

1.0 Introduction

This specification document describes the interfaces and functional operation of the C1400 Direct FuelCell ® (DFC®)
stack module. The C1400 stack module is comprised of four DFC stack modules, and the associated enclosure and process
and electrical connections. *

2.0 Scope

This document describes one C1400 module. The specification provides preliminary dimensional and interface data that
can be used for planning and design. Final drawings will be provided as part of formal project data submittal.

3.0 Specifications

3.1 Dimensions and Weights

*

3.2 Mechanical Interfaces

*

3.3 Civil Interfaces

*

Figure 1

Module Foundation Bolt Details from FCE Drawing 12-01

Preliminary, For Planning and Design. Final drawing to be issued during project data submittals

3.4 Electrical and Control Interfaces

*

3.5 Performance Specification

Table 1 summarizes the projected output from the stack module at rated load.

*

Table 1

Nominal Stack Module Output at Rated Load

* Confidential information has been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for Confidential Treatment. 

 

1

 

*

Table 2 (to be modified)

Fuel and Air Gas Flows Needed to Produce Specified DC Output

*

* Confidential information has been omitted and filed separately with the Securities and Exchange Commission pursuant to
a request for Confidential Treatment. 

 

2

 

Table 3

Contaminant Limits for Fuel and Air Process Streams

*

3.6 Stack Module Life

*

Table 4

Life Impacts of Stack Operation Transients

*

* Confidential information has been omitted and filed separately with the Securities and Exchange Commission pursuant to
a request for Confidential Treatment. 

 

3

 

APPENDIX B

Specifications for DFC® Components

C1400 Stack Module Kit Scope Specification

1.0 Introduction

This specification describes scope of supply for Direct FuelCell stack module component kits, which will be used in the
assembly of C1400 stack modules.

2.0 Scope

This document describes the component kit for one C1400 module.

3.0 Specifications

3.1 Dimensions and Weights

*

3.2 Component and subassembly listing.

*

APPENDIX C

Standard Pre-Shipment Factory Test Report for DFC® Modules

*

* Confidential information has been omitted and filed separately with the Securities and Exchange Commission pursuant to
a request for Confidential Treatment. 

 

4

 

APPENDIX D

Standard Pre-Shipment Factory Inspection Report for DFC® Components

*

* Confidential information has been omitted and filed separately with the Securities and Exchange Commission pursuant to a request for Confidential Treatment. 

 

5exv4w2

Exhibit 4.2

CERTIFICATE OF DESIGNATIONS

OF

FIXED RATE CUMULATIVE PERPETUAL PREFERRED STOCK, SERIES A

INTERMOUNTAIN COMMUNITY BANCORP

* * *

     Part 1. Definitions. The following terms are used in this Certificate of
Designations as defined below:

     (a) “Common Stock” means the common stock, no par value, of the Corporation.

     (b) “Dividend Payment Date” means February 15, May 15, August 15 and November 15 of
each year.

     (c) “Junior Stock” means the Common Stock and any other class or series of stock of
the Corporation the terms of which expressly provide that it ranks junior to Designated Preferred
Stock as to dividend rights and/or as to rights on liquidation, dissolution or winding up of the
Corporation.

     (d) “Liquidation Amount” means $1,000 per share of Designated Preferred Stock.

     (e) “Minimum Amount” means $6,750,000.

     (f) “Parity Stock” means any class or series of stock of the Corporation (other than
Designated Preferred Stock) the terms of which do not expressly provide that such class or series
will rank senior or junior to Designated Preferred Stock as to dividend rights and/or as to rights
on liquidation, dissolution or winding up of the Corporation (in each case without regard to
whether dividends accrue cumulatively or non-cumulatively).

     (g) “Signing Date” means December 19, 2008.

     Part. 2. Certain Voting Matters. Holders of shares of Designated Preferred Stock will
be entitled to one vote for each such share on any matter on which holders of Designated Preferred
Stock are entitled to vote, including any action by written consent.

     Part 3. Conflict. In the event of any conflict or inconsistency between the terms set
forth in this Certificate of Designations and those set forth in the remainder of the Articles of
Incorporation, the terms set forth in this Certificate of Designations shall govern.

* * *

     Section 1. General Matters. Each share of Designated Preferred Stock shall be
identical in all respects to every other share of Designated Preferred Stock. The Designated
Preferred Stock shall be perpetual, subject to the provisions of Section 5 of these Standard
Provisions that form a part of the Certificate of Designations. The Designated Preferred Stock
shall rank equally with Parity Stock and shall rank senior to Junior Stock with respect to the
payment of dividends and the distribution of assets in the event of any dissolution, liquidation or
winding up of the Corporation.

     Section 2. Standard Definitions. As used herein with respect to Designated Preferred
Stock:

1

 

     (a) “Applicable Dividend Rate” means (i) during the period from the Original Issue Date to,
but excluding, the first day of the first Dividend Period commencing on or after the fifth
anniversary of the Original Issue Date, 5% per annum and (ii) from and after the first day of the
first Dividend Period commencing on or after the fifth anniversary of the Original Issue Date, 9%
per annum.

     (b) “Appropriate Federal Banking Agency” means the “appropriate Federal banking agency” with
respect to the Corporation as defined in Section 3(q) of the Federal Deposit Insurance Act (12
U.S.C. Section 1813(q)), or any successor provision.

     (c) “Business Combination” means a merger, consolidation, statutory share exchange or similar
transaction that requires the approval of the Corporation’s stockholders.

     (d) “Business Day” means any day except Saturday, Sunday and any day on which banking
institutions in the State of New York generally are authorized or required by law or other
governmental actions to close.

     (e) “Bylaws” means the bylaws of the Corporation, as they may be amended from time to time.

     (f) “Certificate of Designations” means the Certificate of Designations or comparable
instrument relating to the Designated Preferred Stock, of which these Standard Provisions form a
part, as it may be amended from time to time.

     (g) “Charter” means the Corporation’s certificate or articles of incorporation, articles of
association, or similar organizational document.

     (h) “Dividend Period” has the meaning set forth in Section 3(a).

     (i) “Dividend Record Date” has the meaning set forth in Section 3(a).

     (j) “Liquidation Preference” has the meaning set forth in Section 4(a).

     (k) “Original Issue Date” means the date on which shares of Designated Preferred Stock are
first issued.

     (l) “Preferred Director” has the meaning set forth in Section 7(b).

     (m) “Preferred Stock” means any and all series of preferred stock of the Corporation,
including the Designated Preferred Stock.

     (n) “Qualified Equity Offering” means the sale and issuance for cash by the Corporation to
persons other than the Corporation or any of its subsidiaries after the Original Issue Date of
shares of perpetual Preferred Stock, Common Stock or any combination of such stock, that, in each
case, qualify as and may be included in Tier 1 capital of the Corporation at the time of issuance
under the applicable risk-based capital guidelines of the Corporation’s Appropriate Federal Banking
Agency (other than any such sales and issuances made pursuant to agreements or arrangements entered
into, or pursuant to financing plans which were publicly announced, on or prior to October 13,
2008).

     (o) “Share Dilution Amount” has the meaning set forth in Section 3(b).

2

 

     (p) “Standard Provisions” mean these Standard Provisions that form a part of the Certificate
of Designations relating to the Designated Preferred Stock.

     (q) “Successor Preferred Stock” has the meaning set forth in Section 5(a).

     (r) “Voting Parity Stock” means, with regard to any matter as to which the holders of
Designated Preferred Stock are entitled to vote as specified in Sections 7(a) and 7(b) of these
Standard Provisions that form a part of the Certificate of Designations, any and all series of
Parity Stock upon which like voting rights have been conferred and are exercisable with respect to
such matter.

     Section 3. Dividends.

     (a) Rate. Holders of Designated Preferred Stock shall be entitled to receive, on each
share of Designated Preferred Stock if, as and when declared by the Board of Directors or any duly
authorized committee of the Board of Directors, but only out of assets legally available therefor,
cumulative cash dividends with respect to each Dividend Period (as defined below) at a rate per
annum equal to the Applicable Dividend Rate on (i) the Liquidation Amount per share of Designated
Preferred Stock and (ii) the amount of accrued and unpaid dividends for any prior Dividend Period
on such share of Designated Preferred Stock, if any. Such dividends shall begin to accrue and be
cumulative from the Original Issue Date, shall compound on each subsequent Dividend Payment Date
(i.e., no dividends shall accrue on other dividends unless and until the first Dividend Payment
Date for such other dividends has passed without such other dividends having been paid on such
date) and shall be payable quarterly in arrears on each Dividend Payment Date, commencing with the
first such Dividend Payment Date to occur at least 20 calendar days after the Original Issue Date.
In the event that any Dividend Payment Date would otherwise fall on a day that is not a Business
Day, the dividend payment due on that date will be postponed to the next day that is a Business Day
and no additional dividends will accrue as a result of that postponement. The period from and
including any Dividend Payment Date to, but excluding, the next Dividend Payment Date is a
“Dividend Period”, provided that the initial Dividend Period shall be the period from and
including the Original Issue Date to, but excluding, the next Dividend Payment Date.

     Dividends that are payable on Designated Preferred Stock in respect of any Dividend Period
shall be computed on the basis of a 360-day year consisting of twelve 30-day months. The amount of
dividends payable on Designated Preferred Stock on any date prior to the end of a Dividend Period,
and for the initial Dividend Period, shall be computed on the basis of a 360-day year consisting of
twelve 30-day months, and actual days elapsed over a 30-day month.

     Dividends that are payable on Designated Preferred Stock on any Dividend Payment Date will be
payable to holders of record of Designated Preferred Stock as they appear on the stock register of
the Corporation on the applicable record date, which shall be the 15th calendar day immediately
preceding such Dividend Payment Date or such other record date fixed by the Board of Directors or
any duly authorized committee of the Board of Directors that is not more than 60 nor less than 10
days prior to such Dividend Payment Date (each, a “Dividend Record Date”). Any such day that is a
Dividend Record Date shall be a Dividend Record Date whether or not such day is a Business Day.

     Holders of Designated Preferred Stock shall not be entitled to any dividends, whether payable
in cash, securities or other property, other than dividends (if any) declared and payable on
Designated Preferred Stock as specified in this Section 3 (subject to the other provisions of the
Certificate of Designations).

     (b) Priority of Dividends. So long as any share of Designated Preferred Stock remains
outstanding, no dividend or distribution shall be declared or paid on the Common Stock or any other

3

 

shares of Junior Stock (other than dividends payable solely in shares of Common Stock) or Parity
Stock, subject to the immediately following paragraph in the case of Parity Stock, and no Common
Stock, Junior Stock or Parity Stock shall be, directly or indirectly, purchased, redeemed or
otherwise acquired for consideration by the Corporation or any of its subsidiaries unless all
accrued and unpaid dividends for all past Dividend Periods, including the latest completed Dividend
Period (including, if applicable as provided in Section 3(a) above, dividends on such amount), on
all outstanding shares of Designated Preferred Stock have been or are contemporaneously declared
and paid in full (or have been declared and a sum sufficient for the payment thereof has been set
aside for the benefit of the holders of shares of Designated Preferred Stock on the applicable
record date). The foregoing limitation shall not apply to (i) redemptions, purchases or other
acquisitions of shares of Common Stock or other Junior Stock in connection with the administration
of any employee benefit plan in the ordinary course of business (including purchases to offset the
Share Dilution Amount (as defined below) pursuant to a publicly announced repurchase plan) and
consistent with past practice, provided that any purchases to offset the Share Dilution Amount
shall in no event exceed the Share Dilution Amount; (ii) purchases or other acquisitions by a
broker-dealer subsidiary of the Corporation solely for the purpose of market-making, stabilization
or customer facilitation transactions in Junior Stock or Parity Stock in the ordinary course of its
business; (iii) purchases by a broker-dealer subsidiary of the Corporation of capital stock of the
Corporation for resale pursuant to an offering by the Corporation of such capital stock
underwritten by such broker-dealer subsidiary; (iv) any dividends or distributions of rights or
Junior Stock in connection with a stockholders’ rights plan or any redemption or repurchase of
rights pursuant to any stockholders’ rights
plan; (v) the acquisition by the Corporation or any of its subsidiaries of record ownership in
Junior Stock or Parity Stock for the beneficial ownership of any other persons (other than the
Corporation or any of its subsidiaries), including as trustees or custodians; and (vi) the exchange
or conversion of Junior Stock for or into other Junior Stock or of Parity Stock for or into other
Parity Stock (with the same or lesser aggregate liquidation amount) or Junior Stock, in each case,
solely to the extent required pursuant to binding contractual agreements entered into prior to the
Signing Date or any subsequent agreement for the accelerated exercise, settlement or exchange
thereof for Common Stock. “Share Dilution Amount” means the increase in the number of diluted
shares outstanding (determined in accordance with generally accepted accounting principles in the
United States, and as measured from the date of the Corporation’s consolidated financial statements
most recently filed with the Securities and Exchange Commission prior to the Original Issue Date)
resulting from the grant, vesting or exercise of equity-based compensation to employees and
equitably adjusted for any stock split, stock dividend, reverse stock split, reclassification or
similar transaction.

     When dividends are not paid (or declared and a sum sufficient for payment thereof set aside
for the benefit of the holders thereof on the applicable record date) on any Dividend Payment Date
(or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment
Dates, on a dividend payment date falling within a Dividend Period related to such Dividend Payment
Date) in full upon Designated Preferred Stock and any shares of Parity Stock, all dividends
declared on Designated Preferred Stock and all such Parity Stock and payable on such Dividend
Payment Date (or, in the case of Parity Stock having dividend payment dates different from the
Dividend Payment Dates, on a dividend payment date falling within the Dividend Period related to
such Dividend Payment Date) shall be declared pro rata so that the respective amounts of such
dividends declared shall bear the same ratio to each other as all accrued and unpaid dividends per
share on the shares of Designated Preferred Stock (including, if applicable as provided in Section
3(a) above, dividends on such amount) and all Parity Stock payable on such Dividend Payment Date
(or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment
Dates, on a dividend payment date falling within the Dividend Period related to such Dividend
Payment Date) (subject to their having been declared by the Board of Directors or a duly authorized
committee of the Board of Directors out of legally available funds and including, in the case of
Parity Stock that bears cumulative dividends, all accrued but unpaid dividends) bear to each other.
If the Board of Directors or a duly authorized committee of the Board of Directors

4

 

determines not
to pay any dividend or a full dividend on a Dividend Payment Date, the Corporation will provide
written notice to the holders of Designated Preferred Stock prior to such Dividend Payment Date.

     Subject to the foregoing, and not otherwise, such dividends (payable in cash, securities or
other property) as may be determined by the Board of Directors or any duly authorized committee of
the Board of Directors may be declared and paid on any securities, including Common Stock and other
Junior Stock, from time to time out of any funds legally available for such payment, and holders of
Designated Preferred Stock shall not be entitled to participate in any such dividends.

     Section 4. Liquidation Rights.

     (a) Voluntary or Involuntary Liquidation. In the event of any liquidation, dissolution
or winding up of the affairs of the Corporation, whether voluntary or involuntary, holders of
Designated Preferred Stock shall be entitled to receive for each share of Designated Preferred
Stock, out of the assets of the Corporation or proceeds thereof (whether capital or surplus)
available for distribution to stockholders of the Corporation, subject to the rights of any
creditors of the Corporation, before any distribution of such assets or proceeds is made to or set
aside for the holders of Common Stock and any other stock of the Corporation ranking junior to
Designated Preferred Stock as to such distribution, payment in full in an amount equal to the sum
of (i) the Liquidation Amount per share and (ii) the amount of any accrued and unpaid dividends
(including, if applicable as provided in Section 3(a) above, dividends on such amount), whether or
not declared, to the date of payment (such amounts collectively, the “Liquidation
Preference”).

     (b) Partial Payment. If in any distribution described in Section 4(a) above the assets
of the Corporation or proceeds thereof are not sufficient to pay in full the amounts payable with
respect to all outstanding shares of Designated Preferred Stock and the corresponding amounts
payable with respect of any other stock of the Corporation ranking equally with Designated
Preferred Stock as to such distribution, holders of Designated Preferred Stock and the holders of
such other stock shall share ratably in any such distribution in proportion to the full respective
distributions to which they are entitled.

     (c) Residual Distributions. If the Liquidation Preference has been paid in full to all
holders of Designated Preferred Stock and the corresponding amounts payable with respect of any
other stock of the Corporation ranking equally with Designated Preferred Stock as to such
distribution has been paid in full, the holders of other stock of the Corporation shall be entitled
to receive all remaining assets of the Corporation (or proceeds thereof) according to their
respective rights and preferences.

     (d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes of this
Section 4, the merger or consolidation of the Corporation with any other corporation or other
entity, including a merger or consolidation in which the holders of Designated Preferred Stock
receive cash, securities or other property for their shares, or the sale, lease or exchange (for
cash, securities or other property) of all or substantially all of the assets of the Corporation,
shall not constitute a liquidation, dissolution or winding up of the Corporation.

     Section 5. Redemption.

     (a) Optional Redemption. Except as provided below, the Designated Preferred Stock may
not be redeemed prior to the first Dividend Payment Date falling on or after the third anniversary
of the Original Issue Date. On or after the first Dividend Payment Date falling on or after the
third anniversary of the Original Issue Date, the Corporation, at its option, subject to the
approval of the Appropriate Federal Banking Agency, may
redeem, in whole or in part, at any time and from time to time, out of funds legally available
therefor, the shares of Designated Preferred Stock at the time outstanding, upon notice

5

 

given as
provided in Section 5(c) below, at a redemption price equal to the sum of (i) the Liquidation
Amount per share and (ii) except as otherwise provided below, any accrued and unpaid dividends
(including, if applicable as provided in Section 3(a) above, dividends on such amount) (regardless
of whether any dividends are actually declared) to, but excluding, the date fixed for redemption.

     Notwithstanding the foregoing, prior to the first Dividend Payment Date falling on or after
the third anniversary of the Original Issue Date, the Corporation, at its option, subject to the
approval of the Appropriate Federal Banking Agency, may redeem, in whole or in part, at any time
and from time to time, the shares of Designated Preferred Stock at the time outstanding, upon
notice given as provided in Section 5(c) below, at a redemption price equal to the sum of (i) the
Liquidation Amount per share and (ii) except as otherwise provided below, any accrued and unpaid
dividends (including, if applicable as provided in Section 3(a) above, dividends on such amount)
(regardless of whether any dividends are actually declared) to, but excluding, the date fixed for
redemption; provided that (x) the Corporation (or any successor by Business Combination) has
received aggregate gross proceeds of not less than the Minimum Amount (plus the “Minimum Amount” as
defined in the relevant certificate of designations for each other outstanding series of preferred
stock of such successor that was originally issued to the United States Department of the Treasury
(the “Successor Preferred Stock”) in connection with the Troubled Asset Relief Program Capital
Purchase Program) from one or more Qualified Equity Offerings (including Qualified Equity Offerings
of such successor), and (y) the aggregate redemption price of the Designated Preferred Stock (and
any Successor Preferred Stock) redeemed pursuant to this paragraph may not exceed the aggregate net
cash proceeds received by the Corporation (or any successor by Business Combination) from such
Qualified Equity Offerings (including Qualified Equity Offerings of such successor).

     The redemption price for any shares of Designated Preferred Stock shall be payable on the
redemption date to the holder of such shares against surrender of the certificate(s) evidencing
such shares to the Corporation or its agent. Any declared but unpaid dividends payable on a
redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall not
be paid to the holder entitled to receive the redemption price on the redemption date, but rather
shall be paid to the holder of record of the redeemed shares on such Dividend Record Date relating
to the Dividend Payment Date as provided in Section 3 above.

     (b) No Sinking Fund. The Designated Preferred Stock will not be subject to any
mandatory redemption, sinking fund or other similar provisions. Holders of Designated Preferred
Stock will have no right to require redemption or repurchase of any shares of Designated Preferred
Stock.

     (c) Notice of Redemption. Notice of every redemption of shares of Designated Preferred
Stock shall be given by first class mail, postage prepaid, addressed to the holders of record of
the shares to be redeemed at their respective last addresses appearing on the books of the
Corporation. Such mailing shall be at least 30 days and not more than 60 days before the date fixed
for redemption. Any notice mailed as provided in
this Subsection shall be conclusively presumed to have been duly given, whether or not the
holder receives such notice, but failure duly to give such notice by mail, or any defect in such
notice or in the mailing thereof, to any holder of shares of Designated Preferred Stock designated
for redemption shall not affect the validity of the proceedings for the redemption of any other
shares of Designated Preferred Stock. Notwithstanding the foregoing, if shares of Designated
Preferred Stock are issued in book-entry form through The Depository Trust Corporation or any other
similar facility, notice of redemption may be given to the holders of Designated Preferred Stock
at such time and in any manner permitted by such facility. Each notice of redemption given to a
holder shall state: (1) the redemption date; (2) the number of shares of Designated Preferred Stock
to be redeemed and, if less than all the shares held by such holder are to be redeemed, the number
of such shares to be redeemed from such holder; (3) the redemption price; and (4) the place or
places where certificates for such shares are to be surrendered for payment of the redemption
price.

6

 

     (d) Partial Redemption. In case of any redemption of part of the shares of Designated
Preferred Stock at the time outstanding, the shares to be redeemed shall be selected either pro
rata or in such other manner as the Board of Directors or a duly authorized committee thereof may
determine to be fair and equitable. Subject to the provisions hereof, the Board of Directors or a
duly authorized committee thereof shall have full power and authority to prescribe the terms and
conditions upon which shares of Designated Preferred Stock shall be redeemed from time to time. If
fewer than all the shares represented by any certificate are redeemed, a new certificate shall be
issued representing the unredeemed shares without charge to the holder thereof.

     (e) Effectiveness of Redemption. If notice of redemption has been duly given and if on
or before the redemption date specified in the notice all funds necessary for the redemption have
been deposited by the Corporation, in trust for the pro rata benefit of the holders of the shares
called for redemption, with a bank or trust company doing business in the Borough of Manhattan, The
City of New York, and having a capital and surplus of at least $500 million and selected by the
Board of Directors, so as to be and continue to be available solely therefor, then, notwithstanding
that any certificate for any share so called for redemption has not been surrendered for
cancellation, on and after the redemption date dividends shall cease to accrue on all shares so
called for redemption, all shares so called for redemption shall no longer be deemed outstanding
and all rights with respect to such shares shall forthwith on such redemption date cease and
terminate, except only the right of the holders thereof to receive the amount payable on such
redemption from such bank or trust company, without interest. Any funds unclaimed at the end of
three years from the redemption date shall, to the extent permitted by law, be released to the
Corporation, after which time the holders of the shares so called for redemption shall look only to
the Corporation for payment of the redemption price of such shares.

     (f) Status of Redeemed Shares. Shares of Designated Preferred Stock that are redeemed,
repurchased or otherwise acquired by the Corporation shall revert to authorized but unissued shares
of Preferred Stock (provided that any such cancelled
shares of Designated Preferred Stock may be reissued only as shares of any series of Preferred
Stock other than Designated Preferred Stock).

     Section 6. Conversion. Holders of Designated Preferred Stock shares shall have no
right to exchange or convert such shares into any other securities.

     Section 7. Voting Rights.

     (a) General. The holders of Designated Preferred Stock shall not have any voting
rights except as set forth below or as otherwise from time to time required by law.

     (b) Preferred Stock Directors. Whenever, at any time or times, dividends payable on
the shares of Designated Preferred Stock have not been paid for an aggregate of six quarterly
Dividend Periods or more, whether or not consecutive, the authorized number of directors of the
Corporation shall automatically be increased by two and the holders of the Designated Preferred
Stock shall have the right, with holders of shares of any one or more other classes or series of
Voting Parity Stock outstanding at the time, voting together as a class, to elect two directors
(hereinafter the “Preferred Directors” and
each a “Preferred Director”) to fill such newly created
directorships at the Corporation’s next annual meeting of stockholders (or at a special meeting
called for that purpose prior to such next annual meeting) and at each subsequent annual meeting of
stockholders until all accrued and unpaid dividends for all past Dividend Periods, including the
latest completed Dividend Period (including, if applicable as provided in Section 3(a) above,
dividends on such amount), on all outstanding shares of Designated Preferred Stock have been
declared and paid in full at which time such right shall terminate with respect to the Designated
Preferred Stock, except as herein or by law expressly provided, subject to revesting in the event
of each and every subsequent default of the character above mentioned; provided that it shall be a
qualification

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for election for any Preferred Director that the election of such Preferred Director
shall not cause the Corporation to violate any corporate governance requirements of any securities
exchange or other trading facility on which securities of the Corporation may then be listed or
traded that listed or traded companies must have a majority of independent directors. Upon any
termination of the right of the holders of shares of Designated Preferred Stock and Voting Parity
Stock as a class to vote for directors as provided above, the Preferred Directors shall cease to be
qualified as directors, the term of office of all Preferred Directors then in office shall
terminate immediately and the authorized number of directors shall be reduced by the number of
Preferred Directors elected pursuant hereto. Any Preferred Director may be removed at any time,
with or without cause, and any vacancy created thereby may be filled, only by the affirmative vote
of the holders a majority of the shares of Designated Preferred Stock at the time outstanding
voting separately as a class together with the holders of shares of Voting Parity Stock, to the
extent the voting rights of such holders described above are then exercisable. If the office of any
Preferred Director becomes vacant for any reason other than removal from office as aforesaid, the
remaining Preferred Director may choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred.

     (c) Class Voting Rights as to Particular Matters. So long as any shares of Designated
Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required
by law or by the Charter, the vote or consent of the holders of at least 66 2/3% of the shares of
Designated Preferred Stock at the time outstanding, voting as a separate class, given in person or
by proxy, either in writing without a meeting or by vote at any meeting called for the purpose,
shall be necessary for effecting or validating:

     (i) Authorization of Senior Stock. Any amendment or alteration of the
Certificate of Designations for the Designated Preferred Stock or the Charter to authorize
or create or increase the authorized amount of, or any issuance of, any shares of, or any
securities convertible into or exchangeable or exercisable for shares of, any class or
series of capital stock of the Corporation ranking senior to Designated Preferred Stock
with respect to either or both the payment of dividends and/or the distribution of assets
on any liquidation, dissolution or winding up of the Corporation;

     (ii) Amendment of Designated Preferred Stock. Any amendment, alteration or
repeal of any provision of the Certificate of Designations for the Designated Preferred
Stock or the Charter (including, unless no vote on such merger or consolidation is required
by Section 7(c)(iii) below, any amendment, alteration or repeal by means of a merger,
consolidation or otherwise) so as to adversely affect the rights, preferences, privileges
or voting powers of the Designated Preferred Stock; or

     (iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any
consummation of a binding share exchange or reclassification involving the Designated
Preferred Stock, or of a merger or consolidation of the Corporation with another
corporation or other entity, unless in each case (x) the shares of Designated Preferred
Stock remain outstanding or, in the case of any such merger or consolidation with respect
to which the Corporation is not the surviving or resulting entity, are converted into or
exchanged for preference securities of the surviving or resulting entity or its ultimate
parent, and (y) such shares remaining outstanding or such preference securities, as the
case may be, have such rights, preferences, privileges and voting powers, and limitations
and restrictions thereof, taken as a whole, as are not materially less favorable to the
holders thereof than the rights, preferences, privileges and voting powers, and limitations
and restrictions thereof, of Designated Preferred Stock immediately prior to such
consummation, taken as a whole;

8

 

provided, however, that for all purposes of this Section 7(c), any increase in the amount of the
authorized Preferred Stock, including any increase in the authorized amount of Designated Preferred
Stock necessary to satisfy preemptive or similar rights granted by the Corporation to other persons
prior to the Signing Date, or the creation and issuance, or an increase in the authorized or issued
amount, whether pursuant to preemptive or similar rights or otherwise, of any other series of
Preferred Stock, or any securities convertible into or exchangeable or exercisable for any other
series of Preferred Stock, ranking equally with and/or junior to Designated Preferred Stock with
respect to the
payment of dividends (whether such dividends are cumulative or non-cumulative) and the distribution
of assets upon liquidation, dissolution or winding up of the Corporation will not be deemed to
adversely affect the rights, preferences, privileges or voting powers, and shall not require the
affirmative vote or consent of, the holders of outstanding shares of the Designated Preferred
Stock.

     (d) Changes after Provision for Redemption. No vote or consent of the holders of
Designated Preferred Stock shall be required pursuant to Section 7(c) above if, at or prior to the
time when any such vote or consent would otherwise be required pursuant to such Section, all
outstanding shares of the Designated Preferred Stock shall have been redeemed, or shall have been
called for redemption upon proper notice and sufficient funds shall have been deposited in trust
for such redemption, in each case pursuant to Section 5 above.

     (e) Procedures for Voting and Consents. The rules and procedures for calling and
conducting any meeting of the holders of Designated Preferred Stock (including, without limitation,
the fixing of a record date in connection therewith), the solicitation and use of proxies at such a
meeting, the obtaining of written consents and any other aspect or matter with regard to such a
meeting or such consents shall be governed by any rules of the Board of Directors or any duly
authorized committee of the Board of Directors, in its discretion, may adopt from time to time,
which rules and procedures shall conform to the requirements of the Charter, the Bylaws, and
applicable law and the rules of any national securities exchange or other trading facility on which
Designated Preferred Stock is listed or traded at the time.

     Section 8. Record Holders. To the fullest extent permitted by applicable law, the
Corporation and the transfer agent for Designated Preferred Stock may deem and treat the record
holder of any share of Designated Preferred Stock as the true and lawful owner thereof for all
purposes, and neither the Corporation nor such transfer agent shall be affected by any notice to
the contrary.

     Section 9. Notices. All notices or communications in respect of Designated Preferred
Stock shall be sufficiently given if given in writing and delivered in person or by first class
mail, postage prepaid, or if given in such other manner as may be permitted in this Certificate of
Designations, in the Charter or Bylaws or by applicable law. Notwithstanding the foregoing, if
shares of Designated Preferred Stock are issued in book-entry form through The Depository Trust
Corporation or any similar facility, such notices may be given to the holders of Designated
Preferred Stock in any manner permitted by such facility.

     Section 10. No Preemptive Rights. No share of Designated Preferred Stock shall have
any rights of preemption whatsoever as to any securities of the Corporation, or any warrants,
rights or options issued or granted with respect thereto, regardless of how such securities, or
such warrants, rights or options, may be designated, issued or granted.

     Section 11. Replacement Certificates. The Corporation shall replace any mutilated
certificate at the holder’s expense upon surrender of that certificate to the Corporation. The
Corporation shall replace certificates that become destroyed, stolen or
lost at the holder’s expense upon delivery to the Corporation of reasonably satisfactory
evidence that the certificate has been destroyed, stolen or lost, together with any indemnity that
may be reasonably required by the Corporation.

9

 

     Section 12. Other Rights. The shares of Designated Preferred Stock shall not have any
rights, preferences, privileges or voting powers or relative, participating, optional or other
special rights, or qualifications, limitations or restrictions thereof, other than as set forth
herein or in the Charter or as provided by applicable law.

10

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