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

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

CONFIDENTIAL

 

 

 

APPENDIX A

Specifications for DFC® Stack Modules

*

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

CONFIDENTIAL

 

 

 

APPENDIX B

Specifications for DFC® Components

*

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

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.

CONFIDENTIAL

 

 

 

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.

CONFIDENTIALexv10w54

Exhibit 10.54

Third Amendment to Lease Agreement

Change of Commencement Date

This Third Amendment to Lease Agreement (the “Third Amendment”) is made and entered into to be
effective as of February 21, 2008, by and between MISSION RIDGE ASSOCIATES, LLC a Delaware limited
liability company (“Landlord”), and ENSIGN FACILITY SERVICES, INC., a Nevada corporation
(“Tenant”), with reference to the following facts:

Recitals

	A.	 	Landlord and Tenant have entered into that certain Lease Agreement dated August 28, 2003
(the “Lease”), as amended by that certain First Amendment to Lease Agreement dated January 15,
2004 (“First Amendment”), and amended by the Second Amendment to the Lease Agreement dated
November 30, 2007, for the leasing of certain premises containing approximately 4,799 rentable
(4,280 usable) square feet of space located at 27101 Puerta Real, Suite 460 and 470, Mission
Viejo, California (the “Premises”) as such Premises are more fully described in the Lease.
	 
	B.	 	Landlord and Tenant wish to confirm the Commencement and Termination Dates of the Extended
Term.

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration,
the receipt and adequacy of which are hereby acknowledged, Landlord and Tenant hereby agree as
follows:

	 	1.	 	Recitals: Landlord and Tenant agree that the above recitals are true and
correct.
	 
	 	2.	 	The commencement Date of the Extended Term to the Lease shall be February 22, 2008.
	 
	 	3.	 	The last day of the Extended Term of the Third Amendment to the Lease (the “Expiration
Date”) shall be September 30, 2009.
	 
	 	4.	 	The dates on which the Base Rent will be adjusted are:
	 
	 	 	 	for the period 2/28/08 to 3/21/08 the monthly Base Rent shall be abated;
	 
	 	 	 	for the period 3/22/08 to 2/21/09 the monthly Base Rent shall be $14,157.05
	 
	 	 	 	for the period 2/22/09 to 9/30/09 the monthly Base Rent shall be $14,588.96;

     5. Effect of Amendment: Except as modified herein, the terms and conditions of the
Lease, the First Amendment and the Second Amendment shall remain unmodified and continue in full
force and effect. In the event of any conflict between the terms and conditions of the Lease, the
First Amendment, the Second Amendment and this Third Amendment, the terms and conditions of this
Third Amendment shall prevail.

     6. Definitions: Unless otherwise defined in this Third Amendment, all terms not
defined in this Third Amendment shall have the meaning set forth in the Lease, the First Amendment
and the Second Amendment.

     7. Authority: Subject to the provisions of the Lease, the First Amendment and the
Second Amendment, this Third Amendment shall be binding upon and inure to the benefit of the
parties hereto, their respective heirs, legal representatives, successors and assigns. Each party
hereto and the persons signing below warrant that the person signing below on such parties behalf
is authorized to do so and to bind such party to the terms of this Third Amendment.

     8. The terms and provisions of the Lease, the First Amendment and the Second Amendment are
hereby incorporated in this Third Amendment.

IN WITNESS WHEREOF, the parties have executed this Third Amendment as of the date and the year
first above written.

Tenant:

ENSIGN FACILITY SERVICES, INC.

A Nevada Corporation

	 	 	 	 	 
	By:
	 	/s/ Beverly Wittekind	 	 
	 
	 	 

	 	 
	Its:
	 	 	 	 
	 
	 	 

	 	 
	Date:
	 	 	 	 
	 
	 	 

	 	 
	By:
	 	 	 	 
	 
	 	 

	 	 
	Its:
	 	 	 	 
	 
	 	 

	 	 
	Date:
	 	 	 	 
	 
	 	 

	 	 

 

 

Landlord:

MISSION RIDGE ASSOCIATES LLC,

A Delaware limited liability company

	 	 	 	 	 	 	 
	By:	 	Legacy Partners Commercial, L. P.,

a California limited partnership

as Manager and Agent for Owner	 	 
	 
	 	 	 	 	 	 
	 
	 	By:
	 	Legacy Partners Commercial, Inc.	 	 
	 
	 	 	 	General partner	 	 
	 
	 	 	 	 	 	 
	 
	 	By:	 	/s/ Debra Smith	 	 
	 
	 	 	 	 

Debra Smith
	 	 
	 
	 	Its:
	 	Executive Vice President

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