Common use of Facility Development and Operation Clause in Contracts

Facility Development and Operation. 3.1 Critical Milestones. (a) Subject to the provisions of Section 3.1(c), commencing on the Effective Date, Seller shall develop the Facility in order to achieve the following milestones (“Critical Milestones”) on or before the date set forth in this Section 3.1(a): (i) receipt of all Permits necessary to construct the Facility, as set forth in Exhibit B, in final form, by May 31, 2012; (ii) acquisition of all required real property rights necessary for construction and operation of the Facility, interconnection of the Facility to the Interconnecting Utility, and performance of Seller’s obligations under this Agreement as set forth on Exhibit B, by February 28, 2012; (iii) demonstration of the financial capability (whether through third party financing to Seller or Seller’s own financial assets) to proceed with the development and construction of the Facility, including, as applicable, Seller’s financial obligations with respect to interconnection of the Facility to the Interconnecting Utility and construction of the Network Upgrades by May 31, 2012; (iv) issuance of a full notice to proceed by Seller to its general construction contractor and commencement of construction of the Facility by June 30, 2012; and (v) achievement of the Commercial Operation Date by December 31, 2012. (b) Seller shall provide Buyer with written notice of the achievement of each Critical Milestone within seven days after that achievement, which notice shall include information demonstrating with reasonable specificity that such Critical Milestone has been achieved. Seller acknowledges that Buyer requires such written notice solely for monitoring purposes, and that nothing set forth in this Agreement shall create or impose upon Buyer any responsibility or liability for the development, construction, operation or maintenance of the Facility. (c) In addition to any extension of a date for a Critical Milestone as a result of a Force Majeure under Section 10.1, Seller may elect to extend all of the dates for the Critical Milestones not yet achieved (i) by one year without posting additional Development Period Security and (ii) by up to two additional six month periods by posting additional Development Period Security of $187,500 for each such six-month period. In no event may Seller exercise the right to extend the Critical Milestone dates under this Section 3.1(c) by more than two years, and in no event shall any extension of the Critical Milestone dates as a result of one or more Force Majeure events exceed a cumulative total of an additional twelve (12) months. Any such election shall be made in a written notice delivered to Buyer on or prior to the first date for a Critical Milestone that has not yet been achieved (as such date may have previously been extended). (d) The Parties agree that time is of the essence with respect to the Critical Milestones and is part of the consideration to Buyer in entering into this Agreement.

Facility Development and Operation. 3.1 Critical Milestones. (a) Subject to the provisions of Section 3.1(c), commencing on the Effective Date, Seller shall develop the Facility in order to achieve the following milestones (“Critical Milestones”) on or before the date set forth in this Section 3.1(a): (i) receipt of all Permits necessary to construct the Facility, as set forth in Exhibit B, in final form, by [ ]May 31, 2012; (ii) acquisition of all required real property rights necessary for construction and operation of the Facility, interconnection of the Facility to the Interconnecting Utility, and performance of Seller’s obligations under this Agreement as set forth on Exhibit B, by [ _]February 28, 2012; (iii) demonstration of the financial capability (whether through third party financing to Seller or Seller’s own financial assets) to proceed with the development and construction of the Facility, including, as applicable, Seller’s financial obligations with respect to interconnection of the Facility to the Interconnecting Utility and construction of the Network Upgrades by May [ ] [on or before 12/31/12]May 31, 2012; (iv) issuance of a full notice to proceed by Seller to its general construction contractor and commencement of construction of the Facility by June [ ] [on or before 12/31/12]June 30, 2012; and (v) achievement of the Commercial Operation Date by December [ ] [on or before 12/31/15].December 31, 2012. (b) Seller shall provide Buyer with written notice of the achievement of each Critical Milestone within seven days after that achievement, which notice shall include information demonstrating with reasonable specificity that such Critical Milestone has been achieved. Seller acknowledges that Buyer requires such written notice solely for monitoring purposes, and that nothing set forth in this Agreement shall create or impose upon Buyer any responsibility or liability for the development, construction, operation or maintenance of the Facility. (c) In addition to any extension of a date for a Critical Milestone as a result of a Force Majeure under Section 10.1, Seller may elect to extend all of the dates for the Critical Milestones not yet achieved (i) by one year without posting additional Development Period Security and (ii) by up to two additional six month periods by posting additional Development Period Security of $187,500 [ ] [$5 per kWh of Contract Maximum Amount]187,500 for each such six-month period. In no event may Seller exercise the right to extend the Critical Milestone dates under this Section 3.1(c) by more than two years, and in no event shall any extension of the Critical Milestone dates as a result of one or more Force Majeure events exceed a cumulative total of an additional twelve (12) months. Any such election shall be made in a written notice delivered to Buyer on or prior to the first date for a Critical Milestone that has not yet been achieved (as such date may have previously been extended). (d) The Parties agree that time is of the essence with respect to the Critical Milestones and is part of the consideration to Buyer in entering into this Agreement.