Common use of Quality Determination Clause in Contracts

Quality Determination. (a) After loading Hawaii Electric Light's nominated barge with Product destined for Chevron’s Facility, an independent inspector shall take a minimum of three (3) sealed vessel composite samples of each Product from the delivering barge with one part for the Chevron Facility’s designated laboratory for Chevron’s retention, one part for Hawaii Electric Light’s designated laboratory for testing, which shall be Hawaiian Electric’s laboratory and one to be retained by the Independent Inspector for a period of not less than three (3) months for any quality discrepancies. (b) All Product received into the Chevron Facility shall conform with the Product Specifications set forth in Exhibit A hereto, and/or other specifications as may be mutually agreed to by the Parties. The quality of the Product received into the Chevron Facility shall be determined by analysis of the test sample in accordance with the specifications in Exhibit A. Whenever Hawaii Electric Light purchases Product (to be delivered into the Chevron Facility) from a Party other than Chevron, Hawaii Electric Light shall provide or direct independent inspector to provide Chevron with both a preliminary analysis (API gravity, appearance and, in the case of diesel fuel, flash point), and final Certificate of Analysis from the results of the vessel composite sample at load port prior to discharge into the Chevron Facility. (c) A “vessel composite” sample shall also be taken of the each Product by the independent inspector after the barge reaches Hilo and before it is unloaded. Sealed test samples will be provided to Hawaiian Electric’s lab, Chevron, and retained by the independent inspector for no less than three (3) months. (d) A “running tank composite” sample shall be taken of the shore receiving tanks by Chevron after the barge contents are received and Chevron will test this sample to determine API, flash point and record this information on the “Chevron Petroleum Delivery Receipt Record”. The final API and loading temperature is used to determine “net loaded” amounts for subsequent truck lifting’s from the Chevron Facility. (e) If Chevron becomes aware that any sample for Product owned by Hawaii Electric Light indicates the presence of contamination or Product that does not meet the established Product Specifications, Chevron shall immediately notify Hawaii Electric Light. Chevron shall also have the right but not the obligation to verify the results of Hawaiian Electric’s laboratory analyses. The determination of quality for purposes of this Agreement shall be based on Hawaiian Electric’s laboratory results provided that the arithmetic difference between Hawaiian Electric’s and Chevron’s laboratory results is equal to or less than the then existing reproducibility standard for the appropriate test method referenced in Exhibit A. If the difference between Hawaiian Electric’s and Chevron’s laboratory results is greater than this reproducibility standard, the Parties will confer, in good faith, to resolve the difference. If any dispute by Chevron regarding Hawaiian Electric’s quality determination is not promptly resolved, Chevron may request analysis of the sample retained by the independent inspector by an independent laboratory, whose determination shall be final and binding on both Parties (absent manifest error or fraud). Chevron and Hawaii Electric Light shall share equally the cost of such independent analysis. (f) Any difference between such inspector’s findings and those of Chevron shall be promptly discussed by Chevron and Hawaii Electric Light and, if an agreement cannot be reached as to whether the Product is contaminated or otherwise non-conforming, then Chevron shall have the right to reject the delivery unless Hawaii Electric Light provides a waiver of responsibility to Chevron’s satisfaction. (g) Chevron shall not be obligated to accept Product into the Chevron Facility if such Product does not meet the specifications set forth in this Agreement or as otherwise agreed to by the Parties or does not fully comply with all legal requirements at the time of delivery but will notify Hawaii Electric Light immediately of the situation. (h) Hawaii Electric Light’s storage of Product hereunder is segregated and Chevron shall not commingle or introduce Product into the Chevron Facility storage dedicated to Hawaii Electric Light’s Product from any source (including third parties using the Chevron Facility or Chevron’s own product) without the express written permission of Hawaii Electric Light. (i) Chevron shall perform water draws of its Chevron Facility tank(s) after each receipt of Product by way of barge, and record the results of such draws for Hawaii Electric Light’s review, at no additional cost to Hawaii Electric Light. (j) [ … ] (k) [ … ]

Quality Determination. (a) After loading Hawaii All samples, measurements and determinations drawn, taken and made, respectively, under this Section 6.4 shall be for Fuel in Seller’s tank prior to Pipeline Delivery, however the quality determination for MATS Fuel Deliveries will be based on […]. All such samples shall be considered Final Sample and will be drawn by Seller unless Hawaiian Electric Light's nominated barge with Product destined elects to have samples drawn under the supervision of the Independent Inspector. Seller and Hawaiian Electric will share equally the cost of the Independent Inspector (b) The quality and BTU Content of the Fuel Delivered shall be determined on the basis of a volumetric weighted average composite of samples drawn from Seller’s issuing tank(s) at Seller’s Refinery for ChevronPipeline Deliveries, or the vessel’s Facilitycomposite sample for Marine Deliveries, an independent inspector in such manner as to be representative of each individual Delivery (“Final Sample”). (c) The Final Sample shall take be divided into a minimum of three (3) sealed vessel composite samples parts as follows: 1. One part shall be provided to Seller’s laboratory for analysis to determine quality including BTU Content per barrel. 2. One part shall be provided to Hawaiian Electric for the purpose of each Product from the delivering barge with verifying Seller’s determinations. 3. At least one part for the Chevron Facility’s designated laboratory for Chevron’s retention, one part for Hawaii Electric Light’s designated laboratory for testing, which shall be Hawaiian Electric’s laboratory sealed and one provided to the Independent Inspector to be retained by the Independent Inspector for a period of not less than three (3) months for any quality discrepancies. (b) All Product received into the Chevron Facility shall conform with the Product Specifications set forth in Exhibit A hereto, and/or other specifications as may be mutually agreed to by the Parties. The quality of the Product received into the Chevron Facility shall be determined by analysis of the test sample in accordance with the specifications in Exhibit A. Whenever Hawaii Electric Light purchases Product (to be delivered into the Chevron Facility) from a Party other than Chevron, Hawaii Electric Light shall provide or direct independent inspector to provide Chevron with both a preliminary analysis (API gravity, appearance and, in the case of diesel fuel, flash point), and final Certificate of Analysis from the results of the vessel composite sample at load port prior to discharge into the Chevron Facility. (c) A “vessel composite” sample shall also be taken of the each Product by the independent inspector after the barge reaches Hilo and before it is unloaded. Sealed test samples will be provided to Hawaiian Electric’s lab, Chevron, and retained by the independent inspector for no less than least three (3) months. (d) A “running tank composite” sample Seller agrees to provide Hawaiian Electric with a copy of Seller’s Certificate of Quality of Fuel Final Sample, and shall be taken provide this prior to shipment of the shore receiving tanks by Chevron after Fuel. Seller agrees to provide API gravity to Independent Inspector prior to the barge contents are received and Chevron will test this sample to determine API, flash point and record this information on shipment of the “Chevron Petroleum Delivery Receipt Record”. The final API and loading temperature is used to determine “net loaded” amounts for subsequent truck lifting’s from the Chevron FacilityFuel. (e) If Chevron becomes aware that any sample for Product owned by Hawaii Hawaiian Electric Light indicates the presence of contamination or Product that does not meet the established Product Specifications, Chevron shall immediately notify Hawaii Electric Light. Chevron shall also have the right but not the obligation to perform laboratory analyses in order to verify the results of Hawaiian ElectricSeller’s laboratory analyses. The determination of quality for purposes of this Agreement ; provided however, that such verification analyses shall be based on performed in a timely manner. Seller and Hawaiian Electric’s laboratory Electric will make reasonable good faith efforts to evaluate BTU Content and exchange results provided that the arithmetic difference between Hawaiian Electric’s and Chevron’s laboratory results is equal to or less than the then existing reproducibility standard for the appropriate test method referenced in Exhibit A. If the difference between Hawaiian Electric’s and Chevron’s laboratory results is greater than this reproducibility standard, the Parties will confer, in good faith, to resolve the difference. If any dispute by Chevron regarding Hawaiian Electric’s quality determination is not promptly resolved, Chevron may request analysis within […] of the sample retained by completion of the independent inspector by an independent laboratory, whose determination shall be final and binding on both Parties (absent manifest error or fraud). Chevron and Hawaii Electric Light shall share equally the cost of such independent analysisPipeline Delivery. (f) Any difference between such inspector’s findings and those In order to eliminate or minimize the volume of Chevron shall be promptly discussed by Chevron and Hawaii Electric Light and, if an agreement cannot be reached as to whether the Product is contaminated or otherwise non-conforming, then Chevron shall have the right to reject the delivery unless Hawaii Electric Light provides a waiver of responsibility to Chevron’s satisfaction[…]. (g) Chevron shall If Hawaiian Electric elects not be obligated to accept Product into the Chevron Facility commence Pipeline Delivery operations by displacing Seller’s Pipeline Fill with Hawaiian Electric’s Fuel, or if such Product displacement is operationally unfeasible or impractical for any other cause, Seller and Hawaiian Electric recognize that the Fuel received by Hawaiian Electric in a Pipeline Delivery may be a blend which includes some amount of Seller’s Pipeline Fill (“Pipeline Blend”). In such instance, the specification of Seller’s Pipeline Fill shall be determined by Seller on the basis of Seller’s samples representative of the contents of the storage tank from which Seller’s Pipeline Fill was issued. Seller agrees to provide Hawaiian Electric, Hawaiian Electric’s representative and the Independent Inspector with a copy of its laboratory analysis of the quality of Seller’s Pipeline Fill prior to commencing the Pipeline Delivery. (h) If the pipeline fill between Seller and Hawaiian Electric does not meet the specifications set forth listed in this Agreement Exhibit A, Seller agrees to perform a pre-shipment computer blend simulation representing the quality of Seller’s Fuel from the issuing tank(s) as indicated in the relevant Certificates of Quality or as otherwise agreed to by the Parties or does not fully comply with all legal requirements at the time of delivery but will notify Hawaii Electric Light immediately preliminary laboratory analyses of the situation. (h) Hawaii Final Samples and the quality of Seller’s Pipeline Fill as indicated in the relevant laboratory analyses. The computer blend simulation shall provide preliminary confirmation of the Pipeline Blend’s conformance with the limits for API gravity, viscosity and percent by weight sulfur content specified in Article IV. Seller agrees to provide Hawaiian Electric Lightor Hawaiian Electric’s storage representative and the Independent Inspector a copy of Product hereunder is segregated and Chevron the computer blend simulation results prior to shipment. Seller agrees that under no circumstances shall not commingle it make a Delivery of Fuel to Hawaiian Electric should the computer blend simulation or introduce Product into any other information available to Seller indicate a quality problem with the Chevron Facility storage dedicated to Hawaii Electric LightFuel or Pipeline Blend, without Hawaiian Electric’s Product from any source (including third parties using the Chevron Facility or Chevron’s own product) without the express written permission of Hawaii Electric Lightpermission. (i) Chevron The quantity of Fuel in a Pipeline Delivery shall perform water draws be determined at the time of its Chevron Facility each Pipeline Delivery by gauging Seller’s issuing tank(s) immediately before and after each receipt pumping under the supervision of Product the Independent Inspector. Should Hawaiian Electric elect to perform a Reverse Line Displacement, the total quantity of Fuel Delivered to Hawaiian Electric shall be reduced by way reference to the rise in Seller’s tank(s) receiving Seller’s Pipeline Fill, determined by gauging such tank(s) immediately before and after pipeline displacement under the supervision of bargethe Independent Inspector. Both Hawaiian Electric and Seller agree that if measurement of Seller’s tank(s) is, in the opinion of the Independent Inspector, considered to have been rendered inaccurate for reasons including, but not limited to, operational constraints or inadvertent transfer of Fuel or of Seller’s Pipeline Fill within Seller’s facilities, then the quantity of Fuel or Seller’s Pipeline Fill may be determined by gauging Hawaiian Electric’s receiving tank(s) before and record after pumping under the results supervision of such draws for Hawaii Electric Light’s review, at no additional cost to Hawaii Electric Light.the Independent Inspector (j) [ … ] (k) [ … ]Quantities of Fuel sold and Delivered by Seller and purchased and received by Hawaiian Electric hereunder shall be calculated in accordance with the current measurement standards adopted by industry, ASTM, API and other recognized standard-setting bodies as are applicable in the opinion of the Independent Inspector and shall be expressed in U.S. barrels at 60 DF.