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Exhibit 10.35
OPERATIONS AND MAINTENANCE AGREEMENT FOR ELK RIVER
RESOURCE RECOVERY FACILITY AND XXXXXX ASH LANDFILL
THIS OPERATIONS AND MAINTENANCE AGREEMENT (the "Agreement") is made as of this
1st day of November, 1996 by and between Northern States Power Company, a
Minnesota corporation ("Owner") and NRG Energy, Inc., a Delaware corporation
("Operator").
RECITALS:
WHEREAS, Owner is a public utility which serves retail customers in
Minnesota, South Dakota and North Dakota, and which is subject to regulation by
the Minnesota Public Utilities Commission ("MPUC"), among other agencies;
WHEREAS, Operator is a wholly-owned subsidiary of Owner engaged in the
business of owning and operating electric generating facilities and facilities
for the transportation and processing of municipal solid waste into
refuse-derived fuel ("RDF");
WHEREAS, Owner owns an undivided 85% interest in the fixed assets and 100%
interest in the mobile assets of a facility located in Elk River, Minnesota for
the receipt and processing of municipal solid waste into RDF as more
particularly described on Exhibit A (the "Facility");
WHEREAS, Owner owns an ash landfill facility in Becker, Minnesota, as more
particularly described on Exhibit B (the "Ash Landfill");
WHEREAS, the County of Anoka ("Anoka County") and Owner entered into a
Loan Agreement, as defined herein (the "Loan Agreement"), pursuant to which
Anoka County agreed to loan to Owner the proceeds of its Floating/Fixed Rate
Resource Recovery Revenue Bonds (Northern States Power Company Project), Series
1985 (the "Series 1985 Bonds") for the purpose of financing costs of the
Facility to be acquired, constructed and equipped and thereafter owned and
operated by Owner;
WHEREAS, Anoka County and Owner entered into a service agreement dated
November 26, 1985 as amended and restated on March 10, 1987 ("Anoka Service
Agreement");
WHEREAS, the County of Hennepin and Owner entered into a service agreement
dated December 30, 1987 ("Hennepin Service Agreement");
WHEREAS, the County of Xxxxxxxxx and Owner entered into a service
agreement in March, 1987 ("Xxxxxxxxx Service Agreement");
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WHEREAS, The Tri-County Solid Waste Management Commission ("Tri-County
Commission") and Owner entered into a service agreement in March, 1987
("Tri-County Service Agreement);
WHEREAS, Hennepin County, Anoka County, Xxxxxxxxx County, the Tri-County
Commission and Owner entered into an Ash Management Services Agreement dated
June 15, 1989 ("Ash Management Service Agreement") pursuant to which Owner
agreed to transport, dispose of and store various ash;
WHEREAS, Anoka County and Owner entered into a design and construction
agreement dated November 26, 1985, as amended and restated on March 10, 1987
("Construction Agreement");
WHEREAS, Owner and United Power Association ("UPA") entered into an
agreement dated February 10, 1987 as amended on March 15, 1991 ("UPA
Agreement"), pursuant to which UPA and Owner defined their respective rights and
obligations with respect to management, administration, ownership, revenues and
responsibilities with respect to the Facility;
WHEREAS, Owner and Operator have entered into an Administrative Services
Agreement dated February 24, 1992 (the "Administrative Agreement") approved by
the MPUC under which either entity may provide services to the other and setting
forth the means by which compensation for any such services is to be computed;
and
WHEREAS, Owner desires that Operator continue to operate and maintain the
Facility and Ash Landfill, pursuant to an agreement independent of the
Administrative Agreement;
NOW THEREFORE, in consideration of the premises and the mutual promises
and agreements of the parties, the parties agree as follows:
1. DEFINITIONS
The following terms shall have the meaning set forth herein:
1.1 Agreement: This contract, including all appendices, exhibits and
schedules attached or incorporated, as it may be amended,
supplemented or modified by the Parties from time to time in
accordance with this Agreement.
1.2 Annual Operating Budget: The budget materials and information
prepared by Operator each year of the Term as set forth in Section
5.1.
1.3 Ash Landfill: The real property, fixtures, equipment, personal
property, improvements and other items described on Exhibit B.
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1.4 Ash Landfill Equipment: All equipment, fixtures and machinery used
in the operation or maintenance of the Ash Landfill.
1.5 Base Management Fee: The amount Owner is to pay Operator as provided
in Section 6.5.
1.6 Commencement Date: The date on which Operator commenced the
provision of operation and maintenance services for the Facility and
Ash Landfill, which is agreed to be January 1, 1994.
1.7 Contract Year: From January 1 to December 31 of any given calendar
year.
1.8 Effective Date: The date on which this Agreement takes effect, as
set forth in Section 9.1.
1.9 Emergency: Any condition, situation or event relating to or
affecting the Facility, the Ash Landfill, or any part thereof which
(i) imminently endangers or might endanger the life or safety of
persons or result in damage to property; or (ii) adversely affects
or might adversely affect the ability of the Facility or Ash
Landfill to meet any material obligation of the Loan Agreement or
might create an Event of Default under the Loan Agreement or any RDF
Facility Agreement; or (iii) creates, or might create, a material
violation of any Law or Permit.
1.10 Event of Default: Any occurrence defined in Section 14.1.
1.11 Facility: The real property, fixtures, improvements, equipment,
personal property and other items located on Exhibit A.
1.12 Facility Equipment: All equipment, fixtures and machinery used in
the operation or maintenance of the Facility.
1.13 Final Non-appealable Order: An order from the MPUC or from any other
judicial, quasi-judicial, administrative or legislative body from
which all rights to seek reconsideration and appeal have been
exhausted or from which the time limits applicable to seeking
reconsideration and appeal have expired.
1.14 Force Majeure: An event or events as defined in Article XII.
1.15 Governmental Authority: The United States of America, the State of
Minnesota, or any state or other political subdivision thereof,
including, without limitation, any municipality, township, or
county, and any entity exercising executive, legislative, judicial,
regulatory or administrative functions
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of or pertaining to government, including, but not limited to, any
corporation or other entity owned or controlled by any of the
foregoing.
1.16 Law(s): Any constitution, charter, act, statute, ordinance, code,
rule, regulation, order, permit, condition, specified standards or
objective criteria contained in any applicable permit, approval,
order, decision, determination or ruling of any Governmental
Authority having jurisdiction, all as in effect from time to time,
including without limitation, environmental laws pertaining to air
and water emissions relating to the Facility and Ash Landfill, and
the operation thereof, which standards or criteria must be met in
order for the Facility or Ash Landfill to be operated lawfully, or
other legislative, administrative or judicial action, decree,
judgment or Final Non-appealable Order of any Governmental Authority
having jurisdiction relating to the Facility or Ash Landfill.
1.17 Lien: Any security interest, mortgage, pledge, lien (statutory or
otherwise), claim, hypothecation, assignment, preference, priority,
charge, encumbrance, title, retention agreement, or Lessor's
interest under a capital lease or analogous instrument, or any other
agreement of any kind or nature which has substantially the effect
of constituting a security interest in, of, against or on any
portion of the Facility, Ash Landfill, Facility Equipment or Ash
Landfill Equipment.
1.18 Materials: All supplies, spare parts, materials, tools, consumables,
chemicals and equipment necessary for the operation and maintenance
of the Facility or Ash Landfill.
1.19 MPUC: The Minnesota Public Utilities Commission and any successor
agency.
1.20 Operation and Maintenance Manuals: The operating manuals for the
Facility and Ash Landfill, including the operating data and
parameters, design drawings, specifications, vendor manuals,
manufacturer manuals or warranties and similar materials for the
Facility, Ash Landfill, Facility Equipment and Ash Landfill
Equipment.
1.21 Operator: NRG Energy, Inc. and its successors and assignees.
1.22 Owner: Northern States Power Company and its successors and
assignees.
1.23 Parties: Owner and Operator and their respective successors and
assignees.
1.24 Party: Owner or Operator and any successor or assignee of either
Owner or Operator, respectively.
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1.25 Permits: All federal, state and local authorizations, certificates,
licenses, permits, consents, rights, exemptions, orders,
concessions, determinations, franchises, and approvals required by
any Governmental Authority for the construction, operation or
maintenance of the Facility, the Ash Landfill, the Facility
Equipment, or the Ash Landfill Equipment or otherwise applicable.
1.26 Person: Any individual, partnership, corporation, business trust,
limited liability company, joint stock company, trust,
unincorporated association, joint venture, Governmental Authority or
other entity.
1.27 Potential Event of Default: An event which, but for the passage of
time or the giving of notice or both, would constitute an Event of
Default.
1.28 Prudent Operating Practice: Those practices, designs, means,
techniques, equipment, methods, specifications and standards of
safety and performance, as the same may change from time to time, as
would be used by experienced, knowledgeable and professional firms
performing operation and maintenance services on facilities of the
type and size similar to the Facility or Ash Landfill, which, in the
exercise of reasonable judgment and in the light of the facts known
or which reasonably should have been known, are considered to be
sound, safe and prudent practice in connection with the operation
and maintenance of RDF processing facilities and ash landfill
facilities, and similar facilities, at the time a decision is made
or an action taken or not taken, and which are consistent with all
applicable laws, permits, the RDF Facility Agreements, the Loan
Agreement, the UPA Agreement and relevant standards for reliability,
safety, environmental protection, efficiency and economy.
1.29 RDF Facility Agreements: Collectively the Anoka Service Agreement,
Hennepin Service Agreement, Tri-County Service Agreement, Ash
Management Service Agreement, Construction Agreement, and UPA
Agreement.
1.30 Reimbursable Costs: The costs and expenses set forth in Section 6.2.
1.31 Requests for Payment: The periodic written invoices and requests
from Operator to Owner prepared in accordance with Section 6.7(a)
for payment of the Management Fee, Reimbursable Costs and other
amounts due from Owner to Operator.
1.32 Standards of Performance: The standards for Operator's performance
of the services to be provided as set forth in Section 3.2.
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1.33 Supplies: Lubricants, hand tools, office and laboratory supplies,
protective clothing and any other consumable items required for
operation and maintenance of the Facility, Facility Equipment, Ash
Landfill and Ash Landfill Equipment.
1.34 Term: The Period of time during which this Agreement is in effect.
ARTICLE 11
SCOPE OF WORK
2.1 Scope of Work: Operator will operate and maintain the Facility, Ash
Landfill, Facility Equipment and Ash Landfill Equipment
(collectively the "RDF Facilities") and perform certain other duties
as set forth in this Agreement, including, but not limited to, all
operation and maintenance services defined in Section 3.1 (the
"Contract Services"). Operator shall operate and maintain the RDF
Facilities in a clean, safe, efficient and environmentally
responsible manner. The Contract Services shall be performed in
accordance with the Standards of Performance set forth in Section
3.2.
2.2 RDF Facility Agreements and Permits: Prior to execution of this
Agreement, Owner has provided Operator with copies of the RDF
Facility Agreements and Permits. Upon execution or receipt by Owner
of any new RDF Facility Agreements, Permits, or any amendments to
RDF Facility Agreements or Permits previously transmitted to
Operator, Owner shall provide Operator with executed copies. The
Parties recognize and agree that this Agreement is intended, in
part, to fulfill Owner's operation and maintenance obligations under
the RDF Facility Agreements and, after compliance with the Permits,
Standards of Performance, Prudent Operating Practice, and Laws, to
optimize the operation of the RDF Facilities consistent with Owner's
objective to achieve its expected return.
2.3 Compliance with RDF Facility Agreements and Permits: Operator shall
abide by all terms and conditions of the RDF Facility Agreements and
Permits applicable to the operation and maintenance of the RDF
Facilities in performing any part of the Contract Services. If
Operator's compliance with this Agreement would cause Owner to be in
default or otherwise in breach or violation of any of its
obligations under any RDF Facility Agreement, the Loan Agreement, or
any Permit, the requirements of such agreements or permits shall
control Operator's performance hereunder to the extent necessary to
avoid such default, breach or violation, subject to Operator's
obligation to comply with all Laws. Each Party shall notify the
other as soon as it knows or believes that compliance with this
Agreement may result in such a default, breach or violation.
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ARTICLE III
OPERATOR RESPONSIBILITIES
3.1 On and after the Commencement Date and subject to approval by Owner
of the Annual Operating Budget and any other expenses Operator shall
be responsible for the operation and maintenance of the Ash
Landfill, Ash Landfill Equipment, Facility and Facility Equipment,
including, but not limited to, the following:
A. Performance of all operation and maintenance of the Ash
Landfill, Ash Landfill Equipment, Facility and Facility
Equipment, including the procurement of all Ash Landfill
Equipment, Facility Equipment, Materials, Supplies and related
services required to ensure operation and maintenance in
accordance with the provisions of this Agreement and industry
standards and to accomplish the objectives of maximizing
useful life and minimizing damage to the RDF Facilities and
outages or unavailability due to lack of maintenance.
B. Performance of all preventive maintenance, in accordance with
applicable Operation and Maintenance Manuals and
manufacturers' and vendors' warranties and recommendations;
the performance of routine maintenance such as lubrication,
oil changes, adjustments, and scheduled replacements; and the
performance of corrective maintenance such as repairs after
the occurrence of a problem, breakdown or failure.
C. Performance of all services required by the UPA Agreement, Ash
Management Services Agreement, Tri-County Service Agreement,
Anoka Service Agreement, Hennepin Service Agreement, and
Xxxxxxxxx Service Agreement to operate and maintain the RDF
Facilities, including, but not limited to, all necessary
communication with the respective parties to such agreements,
and preparation of notices, reports and supporting data for
Owner's review and submittal under such agreements, and all
necessary administration of such agreements.
D. Applying for and maintaining all Permits necessary for the
operation of the RDF Facilities.
E. Administration and coordination of all municipal solid waste
supplies received at the Facility, including, but not limited
to, management of
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contract trucking services and landfill operator's contracts
and operations.
F. Preparing and revising site procedures, budgets, logs, records
and technical and administrative reports as may be required or
advisable.
G. Identifying the need for the procurement of subcontractors for
performance of portions of the Contract Services subject to
Owner approval, and scheduling, coordinating and supervising
any such subcontractors.
H. Preparing the Annual Operating Budget required in accordance
with Section 5.1.
I. Preparing and submitting, or providing to Owner for submittal,
with the appropriate Person or Governmental Authority, all
reports, data and other information required by the Permits
and RDF Facility Agreements.
J. Responding in a timely manner to written requests from Owner
for information about the Contract Services.
K. Performing all other responsibilities assigned to Operator
pursuant to this Agreement.
3.2 Standards of Performance: Operator shall perform each item of the
Contract Services in a careful, professional, prudent and efficient
manner at a level of care consistent with that expected from
similarly situated professional operation and maintenance providers,
and in accordance with the following requirements (collectively
"Standards of Performance"):
(a) Prudent Operating Practice;
(b) the terms of the Operation and Maintenance Manuals and other
operating instructions provided by Anoka County or its agents
pursuant to the Construction Agreement or provided by any
other vendors, suppliers or contractors (and, with regard to
any Facility Equipment acquired subsequent to the Commencement
Date, in accordance with the operating instructions provided
by the respective equipment suppliers, vendors or
manufacturers) or other appropriate practices, whichever are
more stringent;
(c) all operational and maintenance obligations imposed on the
Owner pursuant to any RDF Facility Agreement;
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(d) the requirements of the providers of insurance described in
Article VII, and any and all insurance coverage documents
maintained by Owner for the protection of the RDF Facilities
and their revenues, copies of which are provided to Operator;
(e) any and all warranties received from Anoka County or its
agents or any manufacturer of the Facility Equipment or
Materials, which are not part of any RDF Facility Agreements,
copies of which have been provided to Operator;
(f) the Permits and all applicable Laws;
(g) the site procedures, and all other procedures devised by
Operator for operation and maintenance of the RDF Facilities;
(h) after compliance with all relevant Laws, Permits, RDF Facility
Agreements and Standards of Performance, operation of the RDF
Facilities consistent with Owner's objective to achieve its
expected return from the operation of the Facility.
In the case of any conflict between any such standards, the most stringent
applicable standard shall govern.
3.3 Procurement of equipment, materials, services and supplies:
(a) Subject to the limitations set forth in Section 5.2, Operator
shall identify, select, schedule, procure and receive all
equipment, materials, supplies and services necessary to
perform the Contract Services. Operator shall identify all
such items needed, establish technical and commercial
requirements, develop qualified bid lists, request bids or
proposals from prospective vendors and subcontractors,
evaluate bids or proposals received and select appropriate
vendors and subcontractors. Operator shall use its best
efforts to procure all equipment, services and supplies at
competitive rates, and to make all purchases at the lowest
evaluated price available for the appropriate type and quality
of equipment, services and supplies. Operator shall use its
professional judgment to determine when competitive bidding is
appropriate.
(b) Operator shall receive, inspect and inventory all Equipment,
Materials and Supplies delivered and identify and resolve any
defects or deficiencies, and shall sign all invoices, bills of
lading or other documents indicating acceptance when the
Equipment, Materials and
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Supplies meet Operator's purchase order or other
specifications. Operator shall be responsible for resolving
defects or deficiencies identified, including arrangement for
obtaining replacements, modifying or withholding payment, or
otherwise processing any claim or dispute arising under a
purchase order.
(c) In no event shall Operator take title to any Equipment,
Materials or Supplies received for the RDF Facilities. All
purchase orders, bills of lading and other title and shipping
documents with respect to the Equipment, Materials and
Supplies shall specify that Owner is to take title directly
from the manufacturer, vendor or supplier. Title to all
Equipment, Materials and Supplies or other services or items
purchased by Operator in connection with the Contract Services
shall pass directly to Owner from the manufacturer, vendor or
supplier free of all liens of Operator.
(d) Operator shall be responsible for supervising, coordinating
and administering the work of all subcontractors providing
services.
3.4 Inventory. Operator shall maintain an inventory of Materials adequate to
support the continuous and successful operation of the RDF Facilities. The
procurement of such inventory, including replacement Materials, shall be
made in accordance with the provisions of Section 3.3. Operator shall
provide necessary security for such inventory, and establish and manage an
inventory control system.
3.5 Personnel.
(a) Operator shall employ at the Facility and the Ash Landfill the
appropriate number of properly qualified and trained personnel to
perform the Operator's obligations under this Agreement as approved
under the Annual Operating Budget. Operator shall be solely
responsible for the development of a staffing plan and the selection
and training of all personnel employed by Operator at the Facility
and the Ash Landfill following the Commencement Date.
(b) All personnel shall be qualified (including holding all appropriate
valid licenses required by Law) and fully trained for their
respective positions. All individuals utilized by Operator to
perform Contract Services shall be employees of the Operator or
workers or independent contractors under Operator's direction.
Working hours, rates of compensation, and all other matters relating
to such personnel shall be determined by Operator (subject to
Owner's approval with respect to budget items.)
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(c) Operator shall retain sole responsibility and control of labor
matters pertaining to its personnel. Operator shall provide Owner
with such information regarding the selection of its personnel as
Owner may reasonably request. With respect to hiring of personnel
and its employment policies, Operator shall comply with all
applicable federal and state labor and employment Laws and shall
exercise control over labor relations in a reasonable manner
consistent with the intent and purpose of this Agreement, including
the laws and policies set forth in Exhibit C.
(d) Operator acknowledges and agrees that it does not have the authority
to enter into any contracts or collective bargaining agreements
which bind or purport to bind or obligate Owner.
3.6 Training.
(a) Operator shall insure that its personnel are trained in a
satisfactory manner so as to enable each of the personnel to perform
their assigned functions and as required to enable Operator to
comply with its obligations under this Agreement. Operator shall
establish and maintain a regular ongoing training program for the
personnel. This training program shall be designed to train new
personnel, keep existing personnel familiar with all existing site
procedures and informed of all new revisions. Owner may at any time,
upon reasonable notice, review Operator's regular training program
in order to assess its adequacy and compliance with this Section
3.6.
(b) If this Agreement is scheduled to terminate for any reason, Operator
will cooperate with Owner and any replacement operator, at Owner's
expense, in training replacement personnel for the RDF Facilities,
including permitting such replacement personnel to participate in
the training program described in Section 3.6(a).
3.7 Taxes. Operator shall pay all federal, state and local taxes which it is
obligated to pay with respect to wages, salaries and benefits paid or
provided by it to its employees, including, but not limited to: (i) all
payroll-related or consumer taxes of its employees, federal, state and
local tax withholdings, Federal Insurance Contribution Act taxes, and
federal and state unemployment taxes and; (ii) all federal, state and
local corporate income taxes on income earned by Operator. Owner shall pay
real and tangible real estate and personal property taxes for property
owned, leased, or rented by Owner. Operator shall forward to Owner any tax
bills for which Owner is responsible immediately upon receipt by Operator.
Operator shall maintain
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all appropriate records reflecting its tax obligations, withholdings and
payments.
3.8 Safety. Operator shall take all necessary and advisable precautions for
the safety and security of its personnel and other persons at the Facility
and the Ash Landfill and in connection with the performance of the
Contract Services, and shall comply with all applicable safety laws and
requirements, necessary to prevent accidents or injury to persons or
damage to property at the Facility or the Ash Landfill. Operator shall
promptly and continuously update its safety and security procedures to
ensure safe, secure and efficient operation of the Facility and Ash
Landfill.
3.9 Administration. Operator shall administer and be responsible for all cost
accounting, purchasing, personnel, insurance and payroll functions
relating to the performance of the Contract Services. All accounting shall
be in accordance with generally accepted accounting principles. Operator
shall pay all bills related to the Contract Services in a timely manner so
as to take advantage of any available discounts and to avoid any
penalties, except for those bills which are the obligation of Owner to
pay.
3.10 Licenses and Permits.
(a) Operator shall cause each of its personnel to procure and maintain
their respective licenses as required to perform the Contract
Services.
(b) Operator shall maintain each of the Permits and procure any
renewals, revisions, waivers or new Permits necessary or desirable
for the operation and maintenance of the RDF Facilities. Operator
shall retain all original Permits received or obtained by Operator
for the Facility and Ash Landfill from time to time as such Permits
are received or obtained during the term of this Agreement,
including any renewals, revisions, waivers, or amendments and
deliver copies of all such Permits to Owner.
(c) Operator shall perform Owner's obligations under the Permits and any
renewals thereof and shall give all notices required by, and
otherwise comply with, all applicable Permit terms and shall keep
the Permits in full force and effect. In the event any Permit shall
be violated by the operation or maintenance of the Facility or Ash
Landfill by Operator or otherwise, Operator shall promptly notify
Owner and all other applicable Persons and take all necessary action
required to place the Facility and Ash Landfill into compliance with
the Permit as soon as practicable. The provisions of this section
shall apply to any Permit
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required in connection with the transportation, handling,
processing, storage or disposition of any Hazardous Materials.
3.11 Compliance with Laws. Operator shall at all times operate and maintain the
RDF Facilities in a manner which complies in every material respect with
all applicable Laws and Permits, as amended from time to time. In the
event any of the RDF Facilities, Contract Services, or Operator shall
violate any Law, Operator shall promptly notify Owner and all other
applicable Persons and take all necessary action to place the RDF
Facilities into compliance with the applicable Laws.
3.12 Emergencies In the case of an Emergency, Operator shall, as soon as
reasonably practicable, notify Owner of the nature of such Emergency, the
proposed remedial measures and its probable duration. Operator shall act
immediately as required to prevent or overcome any risk of injury to
Persons or material damage to property and to otherwise minimize the
likelihood and degree of adverse consequences from the Emergency.
3.13 Improvements. Operator shall identify any alterations, additions,
modifications or other changes to the RDF Facilities ("Improvements")
which would improve the overall operation, output, safety or efficiency of
the RDF Facilities, and advise Owner in writing of such proposed
Improvements. Upon the written approval of Owner, the Operator shall
arrange for the procurement and integration of all such equipment,
materials and other resources necessary to implement such Improvements at
the RDF Facilities. Except as set forth in the Annual Operating Budget,
the Operator shall make no Improvements other than Improvements made in
accordance with this Section 3.13.
3.14 Books and Record.
(a) Operator shall maintain operating logs, records and reports
documenting the operation of the RDF Facilities, including those
logs, records and reports required by any RDF Facility Agreement or
MPUC, maintain current revisions of Facility and Ash Landfill
drawings, equipment manuals, instruction books, and the Operation
and Maintenance Manuals; and maintain accurate cost ledgers and
accounting records regarding the Contract Services in accordance
with generally accepted accounting principles for review by Owner.
Operator shall also prepare all reports required for Governmental
Authorities, or by the Permits, and provide same to Owner for its
review. Upon termination of this Agreement, the Operator shall turn
over a copy of all such books, logs, ledgers, manuals, reports and
records to Owner.
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(b) Operator shall establish and maintain an information system
reasonably satisfactory to Owner to provide storage and ready
retrieval of Facility and Ash Landfill operating data, including
such information necessary to verify and support calculations for
preparation of documents pursuant to the RDF Facility and Loan
Agreements.
(c) Operator shall prepare and maintain, on a current basis, proper,
accurate, and complete books and records and accounts of all
transactions related to the Facility and Ash Landfill, including
information necessary to verify calculations made pursuant to this
Agreement.
(d) At all reasonable times Owner shall have access to the records
maintained pursuant to this Section and may audit the recordkeeping
practices and systems used to generate the data required by this
Section. Owner shall have the right to determine whether such
practices and systems are in accordance with generally accepted
accounting principles and may cause Operator to make such changes as
necessary to conform with such principles. Operator's records shall
also include all data required by the MPUC and shall be in a form
which satisfies all data requirements of the MPUC. This provision
does not require Operator to utilize the Uniform System of Accounts
of the MPUC.
(e) Owner's right of access to the records described in this Section
3.14 and Operator's obligation to maintain and preserve the same
shall survive for a six (6) year period following the termination of
this Agreement.
(f) With the exception of information relating to Operator's training
program, all reports, data and other documents prepared by Operator
in connection with the Facility, Ash Landfill or Contract Services
shall be the property of Owner as and when the same are prepared and
shall be used by Operator only in the performance of Contract
Services.
3.15 Custody and Access. After the Commencement Date, Operator shall assume
responsibility for the care, custody and control of the Facility and the
Ash Landfill. Upon reasonable notice, Operator shall allow Owner and its
agents and designees full, unrestricted access to the Facility and the Ash
Landfill and all reports, data, information and documents related to the
RDF Facilities and Contract Services in Operator's possession at the
Facility and Ash Landfill, provided that Owner and its agents and
designees agree to comply with all
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applicable safety and security procedures which Operator deems necessary
or advisable.
3.16 Enforcement of Warranties. Operator shall preserve and maintain all
warranties or guarantees of which Owner is beneficiary regarding the
Facility, Facility Equipment, Ash Landfill, Ash Landfill Equipment,
Equipment, and Materials or any component thereof and shall notify Owner
of any claims which Owner may have under such warranties or guarantees of
which Operator becomes aware during the performance of Contract Services.
Operator shall manage and operate the Facility and Ash Landfill consistent
with the conditions applicable to all such warranties and guarantees so as
to preserve their effectiveness and shall take no action which may
adversely affect any claim under any warranty or guarantee without the
express written consent of the Owner.
3.17 No Liens or Encumbrances. Operator shall keep and maintain the Facility,
Ash Landfill, Facility Equipment and Ash Landfill Equipment free and clear
of all Liens and encumbrances (other than Liens created or permitted by
Owner) resulting from acts or omissions of Operator or its subcontractors
or work done at the request of Operator or its subcontractors. In the
event any Lien is imposed and unless (i) execution and enforcement are
effectively stayed, (ii) all claims which the Lien secures are being
actively contested in good faith, with due diligence and by appropriate
proceedings and (iii) Operator has posted a bond or created a financial
reserve sufficient to fully satisfy and release any contested Lien,
Operator shall immediately take whatever actions are necessary to satisfy
and release the Lien. Operator agrees to indemnify and hold Owner harmless
from all claims, judgments, losses, damages, and defense costs, including
reasonable attorneys' fees, incurred or suffered by Owner as a result of
the imposition or pendency of any Lien (other than Liens created or
permitted by Owner) or Owner's reasonable response to any such Lien,
including, but not limited to, all costs incurred to remove or satisfy any
such Lien if Operator fails to do so as required by this Agreement.
3.18 Facility Performance. If any significant deficiency in performance of the
Facility or Ash Landfill occurs, including, but not limited to, a failure
to meet any warranty or obligation under the RDF Facility Agreements, or
if such a deficiency is projected, Operator shall notify Owner of the
deficiency or projected deficiency and shall state Operator's opinion as
to the cause of the deficiency or projected deficiency and prepare a
report in detail, as required, together with a plan to remedy the problem.
Upon Owner's request, Operator shall make available those of its personnel
necessary to review and assess the cause of the deficiency or projected
deficiency with Owner.
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3.19 Periodic and Annual Review
(a) Status meetings shall be held quarterly between Owner's
Representative and Operator's Representative, or more frequently as
may be necessary for the purpose of reviewing Operator's provision
of the Contract Services.
(b) At least (10) ten days before each quarterly status meeting,
Operator shall submit to Owner (i) a progress report, in detail
acceptable to Owner, covering all operations conducted during the
quarter with respect to operations and maintenance, procurement,
Improvements, labor relations, significant interactions with UPA and
any Governmental Authorities, and other significant matters, which
report shall include (with respect to quantitative items) a
comparison of such items to corresponding values for the then
preceding quarter and year and listing of any significant operation
problems along with remedial actions planned and a brief summary of
major activities planned for the next reporting period.
(c) As soon as available, and in any event within forty-five (45) days
after the end of each Contract Year, Operator shall submit to Owner
an annual report certified by the Operator's Representative
describing in detail substantially similar to that contained in the
quarterly reports referred to in Section 3.19(b) above, all of the
Facility and Ash Landfill operations for the preceding Contract Year
and presenting a comparison of the Facility and Ash Landfill
operations with the Annual Operating Budget for the Contract Year
and with those obtained for the preceding Contract Year, if any (the
"Annual Report"). Within thirty (30) days after the submission of
each Annual Report, the Operator's Representative shall meet with
Owner's Representative to review and discuss the report and to
report upon any other aspects of the operations at the Facility and
Ash Landfill that Owner may request.
(d) Operator shall prepare any additional reports required by the RDF
Facility Agreements, Permits, Laws or any Governmental Authority in
a timely and complete manner.
3.20 Litigation; Permit Lapses. Upon obtaining notice or knowledge thereof,
Operator shall submit prompt written notice to Owner of: (i) any
litigation, or material claim, dispute or action, threatened in writing or
filed, concerning the Facility, the Ash Landfill, the RDF Facility
Agreements, or the Contract Services; (ii) any written refusal or
threatened refusal to grant, renew or extend or any pending or written
threatened action that might affect the granting, renewal or extension of,
any license, permit, approval, authorization
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or consent concerning the Facility or Ash Landfill or the Contract
Services; and (iii) any dispute with any Governmental Authority concerning
the Facility or Ash Landfill or the Contract Services, any Permit, or any
dispute with respect to any RDF Facility Agreement.
ARTICLE IV
OWNER RESPONSIBILITIES
4.1 Access. Owner shall provide and grant to Operator right of access to the
Facility and the Ash Landfill, throughout the term of this Agreement.
4.2 Accommodations. Owner shall make available such offices, storage
facilities, unloading docks, restrooms, office equipment and facilities as
are reasonably necessary to perform the Contract Services, and as are
reasonably practicable, at the Facility and Ash Landfill. This section
does not require Owner to invest in Improvements or to expend funds for
items which are properly included in Operator's overhead expenses.
4.3 Manuals and Drawings. Owner shall provide Operator with all current
Operating Manuals and with all as built drawings, specifications,
warranties, diagrams, test results and other documents and information
which Owner may have with respect to the RDF Facilities, which is
necessary to Operator's provision of the Contract Services. Should any
such information be classified as confidential or proprietary, Owner shall
seek to obtain all necessary authorizations, releases, acknowledgments or
other approvals necessary to provide Operator access to and use of such
information. Operator shall comply with all reasonable requests to protect
the confidential and proprietary nature of such information, including,
but not limited to, any requirements contained in any RDF Facility
Agreement.
4.4 Cooperation. Without limiting Operator's obligations hereunder, Owner
shall make reasonable efforts to cooperate with Operator in its
performance of the Contract Services.
4.5 Representatives.
Each Party shall designate a representative who shall be principally
responsible for administration of this Agreement and for communications
between the Parties. The designation of the representative for each Party
may be changed at any time by written notice.
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ARTICLE V
ANNUAL OPERATING BUDGET
5.1 Preparation of Budget. No later than ninety (90) days prior to the
beginning of each Contract Year, Operator shall submit for Owner's review
and approval, a proposed budget on a monthly basis, for the Contract
Services to be performed in the next succeeding Contract Year. The
proposed Annual Operating Budget shall be based on Operator's assessment
of the necessary Contract Services for the next Contract Year and shall
reflect the most economical and reasonable means of performing such
activities in accordance with the Standards of Performance. The proposed
Annual Operating Budget shall include:
(i) the proposed amount to be spent annually for Reimbursable Costs and
the Management Fee then in effect;
(ii) the proposed amounts to be spent for the purchase of Equipment,
Materials, Supplies and services in accordance with Section 3.3,
identifying the items to be purchased;
(iii) a proposed inventory plan;
(iv) proposed Improvements, with a statement describing the purpose and
necessity of each Improvement and the estimated cost of each
Improvement; and
(v) the estimated Performance Incentive, including a schedule detailing
its calculation in accordance with Section 6.6.
5.2 Owner's Review.
(a) Within thirty (30) days after Owner receives Operator's proposed
Annual Operating Budget, Owner shall notify Operator in writing of
Owner's approval or of any proposed revisions to the proposed Annual
Operating Budget. Within 30 days following receipt of Owner's
revisions, Operator shall either confirm to Owner its ability and
agreement to perform the Contract Services during the Contract Year
in question in accordance with the proposed Annual Operating Budget
as revised by Owner, or Operator shall object to Owner's revisions
in writing stating in detail the reason for each objection. Owner
and Operator shall use their best efforts to agree upon an Annual
Operating Budget, which shall be approved in writing by both
Parties, approval for which shall not be unreasonably withheld. If
Owner and
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Operator are unable to agree upon an Annual Operating Budget, Owner
and Operator shall present the dispute for dispute resolution in
accordance with Article VIII. In the event an Annual Operating
Budget has not been agreed upon by the first day of any Contract
Year, the Annual Operating Budget shall be the Annual Operating
Budget used for the preceding Contract Year. Each Annual Operating
Budget shall remain in effect throughout the applicable Operating
Year, subject to updating, revision and amendment as may be proposed
by either Party and consented to in writing by the other Party,
consent for which may not be unreasonably withheld.
(b) If, during any Contract Year, Operator determines that any category
within an Annual Operating Budget will vary for the Contract Year by
more than ten percent (10%) or one hundred thousand dollars
($100,000), whichever is greater, Operator shall immediately notify
Owner and shall follow Owner's instructions regarding further
expenditures for the operation and maintenance of the Facility and
Ash Landfill pursuant to this Agreement. Until such time as Operator
receives such instructions, Operator shall continue to operate and
maintain the Facility and Ash Landfill according to the terms of
this Agreement as permitted under the Annual Operating Budget then
in effect. At no time, without Owner consent, shall Operator be
entitled to make expenditures in any Annual Operating Budget
category which exceed the amount allocated for such category;
provided, however, that the foregoing limitation shall not apply in
the case of Emergencies, which shall be governed by Section 3.12.
ARTICLE VI
PAYMENT
6.1 As the sole and exclusive compensation and reimbursement to Operator for
the performance of the Contract Services Owner shall pay Operator, in the
manner and at the times specified, the Reimbursable Costs, the Management
Fee and the Performance Incentive, adjusted as necessary in accordance
with Sections 6.3, 6.4, 6.9, and 6.10.
6.2 Reimbursable Costs. Subject to any limitations on expenditures in this
Agreement, Owner shall reimburse Operator for the following costs incurred
by Operator in performing the Contract Services, to the extent properly
incurred by Operator pursuant to this Agreement and supported by adequate
documentation (the "Reimbursable Costs"):
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(a) the actual payroll cost for its personnel to the extent involved in
the performance of the Contract Services, including, but not limited
to, necessary overtime, plus the actual cost of associated payroll
taxes, unemployment and disability insurance, worker's compensation
insurance, benefits and other statutory compensation;
(b) the actual cost of Materials, Equipment and Supplies and services
provided by Operator or any subcontractor;
(c) the actual cost of any insurance paid by Operator to provide the
coverages set forth in Section 7.2, except for payments for
deductibles to be paid by Operator pursuant to Section 6.4, and any
claims not covered by insurance as described in Section 7.2(b).
(d) the actual fees and costs necessary to obtain and maintain Permits,
including fees and costs arising from any changes in Laws or Permits
after the execution of this Agreement;
(e) the actual cost of any Improvements approved by Owner, as incurred;
(f) any other cost or expense designated as a Reimbursable Cost in this
Agreement; and
(g) All other costs necessary for conducting the business of the
Facility and Ash Landfill.
6.3 Adjustments for Owner Provided Services. To the extent Operator obtains or
utilizes any Equipment, Materials, Supplies or services of any type from
Owner for its performance of the Contract Services ("Owner Provided
Services"), the value of the Owner Provided Services shall be computed in
accordance with procedures established in the Administrative Agreement and
approved by the MPUC as set forth in Exhibit D. Owner shall have the right
to set off or recoup the value of Owner Provided Services against amounts
due to Operator each month for Reimbursable Costs as invoiced by Operator
pursuant to Section 6.7. When Owner exercises its right to set off or
recoup for the value of Owner Provided Services, Owner shall provide
Operator with documentation, in reasonable detail, showing the basis for
the set off or recoupment and the calculation of the amount due Owner. Any
such set off or recoupment shall be without prejudice to Operator's right
to contest the amount claimed by Owner or the basis for that claim.
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6.4 Exclusions from Reimbursable Costs.
(a) Operator shall be responsible for payment of any fines or penalties
(or settlements in lieu of fines or penalties) payable to any
Governmental Authority, to the extent caused by the negligent acts
or omissions or willful misconduct of Operator, or Operator's
failure to comply with any Law, Permit or any provision of this
Agreement, and such fines or penalties shall not be considered
Reimbursable Costs or otherwise result in any increase in the costs
to be borne by Owner. Owner shall be responsible for the payment of
any other fines or penalties (or settlements in lieu of fines or
penalties) payable to any Governmental Authority as a result of the
failure of the Facility or Ash Landfill to comply with applicable
Laws or Permits. Operator also shall be responsible for payment of
all costs and expenses (including reasonable attorneys' fees and
expenses) incurred by Owner which arise from any negligent acts or
omissions or willful misconduct of Operator or Operator's failure to
comply with any Law, Permit or any provision of this Agreement, and
Owner shall be entitled to offset or recoup such amounts in the same
manner as provided in Section 6.3.
(b) Owner shall not be liable for any additional costs incurred by
Operator, or related fees, to the extent such costs are incurred by
Operator as a result of (i) performance of Contract Services in a
manner inconsistent with the Standards of Performance; (ii) Contract
Services performed to remedy a problem, fault or deficiency created
or aggravated by Operator's failure to conform to the Standards of
Performance, or Equipment, Materials, Supplies or services procured
from any other Person to remedy any such problem, fault or
deficiency; or (iii) Operator's negligent acts or omissions, willful
misconduct or failure to comply with any Law, Permit or any
provision of this Agreement. Any such additional costs or expenses
shall not be included as Reimbursable Costs.
6.5 Base Management Fee.
Owner shall pay to Operator an annual Base Management Fee of two hundred
fifty thousand dollars ($250,000) for each Contract Year, adjusted as set
forth in Section 6.10, commencing on the Effective Date and continuing for
each Contract Year thereafter. The Base Management Fee shall be earned in
monthly installments of one-twelfth of the annual Base Management Fee for
that Contract Year and paid along with incurred Reimbursable Costs as
provided in Section 6.7. If Operator provides Contract Services at any
time for only a portion of a month, the Base Management Fee shall be
prorated accordingly. The Base Management Fee shall constitute full
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payment for the services described in Article III, all Operator overhead
and profit for the Contract Services and general and administrative costs
incurred by Operator.
6.6 Performance Incentive.
In addition to the Base Management Fee and Reimbursable Costs, Owner shall
pay Operator a Performance Incentive, calculated independently for each
Contract Year, based on Actual Pretax Income Before Management Fees of the
Facility and the Ash Landfill, minus Specified Owner Return adjusted to a
pretax basis, minus the Base Management Fee. The components of this
calculation shall be determined as follows:
(a) Actual Pretax Income Before Management Fees shall be determined as:
(i) the sum of all revenues and income items other than income
taxes of the Facility and the Ash Landfill, computed in accordance
with generally accepted accounting principles (GAAP), minus (ii) the
sum of all expenses other than income taxes of the Facility and the
Ash Landfill, computed in accordance with GAAP, plus (iii) the Base
Management Fee, and Performance Incentive amounts. Such amount shall
exclude cumulative effect adjustments recorded as a result of
implementing changes in accounting principles or methods of applying
such principles, as defined by generally accepted accounting
principles, attributable to periods prior to the first Contract Year
for which a Performance Incentive is payable to Operator.
(b) Specified Owner Return shall be calculated as the product of Average
Owner Equity for the Contract Year multiplied by the Approved
Utility Return.
(c) Average Owner Equity shall be calculated based on the thirteen-month
average of the Owner Equity invested in the Facility and the Ash
Landfill for the Contract Year. The thirteen monthly Owner Equity
amounts to be averaged shall be the consecutive month-end balances,
as described in (d), beginning with December prior to the start of
the Contract Year and ending with December of the Contract Year.
(d) Subject to audit verification under Section 6.9, Owner Equity shall
be presumed to be represented by the balance included in Account
20.01.03 (Division 60) of the Owner's accounting records (related to
the Facility and the Ash Landfill). Owner Equity shall include the
cumulative amount of Owner cash invested in the Facility and the Ash
Landfill, assuming: (i) monthly distribution to the Owner of all net
income earned by the Facility and Ash Landfill, computed in
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accordance with GAAP; (ii) monthly distribution to the Owner of 60%
of the depreciation expense and 100% of the deferred income tax
expense of the Facility and Ash Landfill, such amounts computed in
accordance with GAAP; (iii) reduction of monthly distributions to
the Owner under (i) and (ii) for 60% of Improvements, equipment or
other items to be capitalized in the property, plant and equipment
accounts of the Facility and Ash Landfill, such amounts computed in
accordance with GAAP; and (iv) no other equity contributions from or
distributions to the Owner unless approved in writing by both
Parties.
(e) Approved Utility Return shall be the rate of return on common equity
approved by the MPUC in the most recent general rate proceeding of
the Owner for which a Final Nonappealable Order has been issued.
This rate of return shall be expressed as a percentage, and will be
rounded to the nearest one-hundredth of one percent.
(f) If the net numerical result of the calculated Performance Incentive
is less than zero for any Contract Year, the actual Performance
Incentive due to the Operator from the Owner shall be zero for that
year.
(g) For purposes of monthly payments of the Performance Incentive during
each Contract Year, an estimate of Performance Incentive amounts
shall be made using revenues and expenses (as defined in paragraph
6.6(a)) included in the final Annual Operating Budget agreed to by
the Operator and Owner under Sections 5.1 and 5.2. No later than the
March 31 following the end of each Contract Year, estimated
Performance Incentive amounts shall be trued-up to actual amounts
based on actual revenues and expenses of the Facility and Ash
Landfill (as defined in 6.6(a)) and the actual Owner Equity for the
Contract Year. Subject to audit verification under Section 6.9, such
revenues and expenses shall be presumed to be represented by the
corresponding revenues and expenses recorded in the Owner's
accounting records related to the Facility and the Ash Landfill.
6.7 Payments.
(a) By the twentieth day following the end of each month, Operator shall
present an invoice to Owner reflecting amounts due for Reimbursable
Costs incurred and due for the preceding month, the monthly portions
of the Base Management Fee and Performance Incentive and the
appropriate adjustments. The precise format of the invoice and the
required amount of documentation in support of the invoice shall be
established by agreement of the Parties, but in any event shall be
sufficient to accurately and completely describe the Contract
Services
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provided and each significant Reimbursable Cost so as to allow for
meaningful review by Owner and, if necessary, MPUC, parties to the
RDF Facilities Agreements, or any Government Authority. The invoice
shall also state whether or not the Facility and Ash Landfill
operation conformed to the applicable Annual Operating Budget during
the billing period and, if not, the extent and reason for any
material deviation and any related remedial action. No Reimbursable
Costs shall be invoiced by Operator unless they were incurred in
accordance with the applicable Annual Operating Budget, as amended,
supplemented or modified. Except for costs and expenses arising from
an Emergency, any cost or expense incurred or to be incurred by
Operator in order to perform the Contract Services which is not
contemplated or included in the Annual Operating Budget, or which
exceeds the amount included for that cost or expense in the Annual
Operator Budget, and which will cause an increase in the Annual
Operating Budget of more than $100,000, shall be submitted to Owner
separately for approval and, if approved, the Annual Operating
Budget shall be amended accordingly and the increase allowed as a
Reimbursable Cost.
(b) Upon receipt of an invoice from Operator, Owner shall apply any
setoff, recoupment or adjustments pursuant to Sections 6.3 and 6.4
or otherwise appropriate. The balance due Operator shall be due and
payable within 30 days after receipt of the invoice by Owner. If the
due date falls on a weekend or legal holiday, the due date shall be
the next working day.
(c) Owner shall make payment of bills via wire transfer of funds if
requested in writing by Operator, or other similar means at
Operator's sole Expense, and if the request contains adequate
payment information. Owner shall be entitled to conclusively
presume, without any liability whatsoever, that the payment
information furnished by Operator (including name, financial
institution, account numbers, payee, etc.) is accurate. In no event
will Owner be required to pay any xxxx more than once where the
invoice was first paid in accordance with Operator's instructions.
6.8 In addition to any setoff, recoupment or adjustment otherwise made by
Owner, if Owner disputes the validity, reasonableness or accuracy of any
invoice submitted to it for payment, it shall provide Operator an
explanation of the reasons for its dispute within the time provided for
payment by Section 6.6(b).
If Owner disputes only part of a statement submitted to it for payment,
then it shall pay to Operator the undisputed portion of such statement in
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accordance with Section 6.6 and notify Operator in writing of the amount
disputed in accordance with this Section. All such disputes shall be
resolved pursuant to Article VIII of this Agreement.
6.9 Audit Rights.
Notwithstanding the payment of any amount pursuant to Sections 6.6 and
6.7, Owner shall remain entitled at Owner's expense to conduct an audit
and review of all payments made to Operator on a time and material or cost
reimbursable basis, together with any supporting documentation in
accordance with the provisions of Section 6.2 for a period of three (3)
years from and after the close of each Contract Year. Any audit and review
may be conducted by Owner or by its designee and the person conducting the
audit and review shall be entitled to inspect, copy and audit any of
Operator's financial books, records, accounts, and ledgers relating to the
Facility, Ash Landfill or the Contract Services. Operator shall cooperate
with auditors and promptly respond to any questions relating to any audit.
Operator shall retain all information described above for a period of six
(6) years. If, pursuant to any audit and review, it is determined that
any amount previously paid by Operator within the prior three years did
not constitute a due and payable item hereunder, including without
limitation, a properly payable Reimbursable Cost, Operator shall repay
Owner such amount immediately upon demand, with interest determined in
accordance with Section 6.11, or Owner may offset or recoup such amount
for any payment that subsequently may become due to Operator pursuant to
this Agreement. If, pursuant to any such audit or review, it is determined
that Operator is entitled to additional payment or reimbursement, Owner
shall pay Operator such amount immediately upon demand, with interest in
accordance with Section 6.11.
6.10 Management Fee Adjustment.
If the calculation of the Performance Incentive pursuant to Section 6.6
should produce a result which is less than zero, the Owner and Operator
agree that the Management Fee arrangements will be reevaluated to
determine if the definitions of Performance Incentive and/or Specified
Owner Return should be modified in order to provide the Owner with a
reasonable return on equity invested and the Operator with fair
compensation for services provided. Such modifications shall be made, in
the form of an amendment to this Agreement, only if agreed to by both
Parties.
6.11 Interest.
Any amount owed to either Party by the other Party shall accrue interest
each day from the date the amount is due until the date received at the
rate equal
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to the rate established by the First Bank National Association,
Minneapolis, Minnesota as its prime rate plus one percent per annum,
computed and compounded daily.
ARTICLE VII
INSURANCE
7.1 Standards.
All insurance carried and maintained by Operator pursuant to this
Agreement shall be with insurance companies which are authorized to
transact insurance business and cover risks in the State of Minnesota and
which are rated "Excellent" or better by Best's Insurance Guide and Key
Ratings or other insurance companies of recognized responsibility and
satisfactory to the Owner, and, to the extent applicable, the parties to
the Service Agreements, Ash Management Agreement, Loan Agreement and UPA
Agreement, except to the extent Operator qualifies to self-insure the
required coverages.
7.2 Operator Provided Insurance.
(a) Coverages - Operator shall at all times throughout the Term of this
Agreement carry and maintain or cause to be maintained, at its own
expense, insurance with coverage as follows:
i. Worker's Compensation and Employer's Liability Coverage Operator
shall maintain or cause to be maintained Worker's Compensation
insurance written in accordance with statutory limits and Employer's
Liability in an amount not less than $1,000,000 per occurrence and
in the annual aggregate. The Employer's Liability coverage shall not
contain an occupational disease exclusion. Such policy or policies
shall contain an all states endorsement or stop gap endorsement and
alternate employer coverage.
ii. Comprehensive Automobile Liability Coverage - Operator shall
maintain or cause to be maintained Comprehensive Automobile
Liability insurance covering all owned, non-owned and hired vehicles
used by Operator or its permissive users in connection with Contract
Services. Such coverage shall be written in an amount not less than
$1,000,000 per occurrence.
iii. Excess (or Umbrella) Liability Coverage - Operator shall maintain
Excess (or Umbrella) Liability insurance written on an occurrence
basis or on an acceptable claims-made basis providing coverage for a
limit
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of $9,000,000 per occurrence and annual aggregate in excess of the
insurance required in Sections 7(a)(ii) and 7(a)(v).
iv. Subcontractor Insurance - Operator shall require all of Operator's
subcontractors to obtain, maintain and keep in force during the time
in which they are engaged in performing services hereunder
reasonably adequate coverage in accordance with Operator's normal
practice (but not less than Worker's Compensation insurance written
in accordance with statutory limits and Employer's Liability,
Comprehensive Automobile Liability and Commercial General Liability
each with limits of not less than $1,000,000 per occurrence and in
the aggregate) and furnish Owner with acceptable evidence of such
insurance upon its request.
v. Commercial General Liability Coverage. Commercial or Comprehensive
General Liability insurance with a combined single limit of not less
than $1,000,000 per occurrence and in the annual aggregate. Such
coverage shall also include premises/operations, explosion,
collapse and underground hazard, broad form contractual,
products/completed operations, independent contractors, broad form
property damage and personal injury.
vi. Property and Boiler and Machinery Coverage. Property and Boiler and
Machinery insurance on an "all risk" replacement cost basis with
extended coverages, providing coverage for the Facility and Ash
Landfill, Facility Equipment and Ash Landfill Equipment, which shall
include coverage for removal of debris and shall insure the
buildings, structures, boiler and machinery, equipment, facilities,
fixtures and other properties constituting a part of the Facility
and Ash Landfill in an amount satisfactory to Owner with a
deductible of not greater than $1,000,000.
(b) Deductibles. All deductibles or self-insured retentions for the coverages
specified in Section 7(a) shall be the sole responsibility of Operator.
(c) Endorsements. Any insurance policies provided in accordance with Section
7(a) shall be endorsed to provide that if any insurance policy is canceled
for any reason whatsoever, or any substantial change is made in the
coverage that affects the interest of Owner, UPA, Anoka County, Hennepin
County, Xxxxxxxxx County or the Tri-County Commission, the cancellation or
change shall not be effective as to Owner until thirty (30) days after
receipt by Owner of written notice sent by registered mail from the
insurer of such cancellation or change or ten (10) days in the event of
nonpayment of premiums. In
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addition, any insurance provided in accordance with Sections 7(a) (ii),
(iii), (iv), (v), and (vi) shall be endorsed to provide that:
i. Owner, UPA, Anoka County, Xxxxxxxxx County, Hennepin County and the
Tri-County Commission shall be additional insureds in each case with
the understanding that any obligation imposed upon Operator
(including the liability to pay premiums) shall be the sole
obligation of Operator and not that of Owner or the other additional
insureds.
ii. The insurer waives all rights of subrogation against Owner or any
other additional insured and any other right to deduction due to
outstanding premiums, whether by attachment or otherwise. This
provision shall apply to the insurance provided under Section
7.2(a)(i) as well.
iii. The insurance shall be primary without right of contribution of any
other insurance carried by or on behalf of Owner, or any other
additional insured with respect to its interest as such in the
Facility or Ash Landfill.
iv. To the extent the policies are written to cover more than one
insured, all terms, conditions, insuring agreements and endorsements
(other than the limits of liability) shall operate in the same
manner as if there were a separate policy covering each insured.
Any insurance provided in accordance with Section 7(a)(i) shall be
endorsed to provide that the insurer thereunder waives all rights of
subrogation against Owner and the additional insureds and any other
right to deduction due to outstanding premiums, whether by
attachment or otherwise.
(d) On the Effective Date, and each Contract Year thereafter, the
Parties shall arrange to furnish each other with an approved
certificate reflecting all required insurance and copies of
policies, if requested. Such certification shall be executed by each
insurer or by an authorized representative of each insurer. Such
certificate or notice, as the case may be, shall identify insurers,
the type of insurance, the insurance limits, the policy term and
shall specifically list the special provisions enumerated for such
insurance required by this Article VII.
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7.3 Owner Provided Insurance.
(a) Owner shall carry and maintain, or cause to be maintained,
throughout the Term of this Agreement, at its own expense, insurance
with coverage as follows:
i. Excess (or Umbrella) Liability Coverage. Owner shall maintain
excess (or Umbrella) Liability Insurance providing coverage
for a limit of $9,000,000 per occurrence and in the annual
aggregate in excess of any Commercial General Liability
insurance carried by Owner.
ii. Worker's Compensation and Employer's Liability Coverage Owner
shall maintain or cause to be maintained Worker's Compensation
insurance written in accordance with statutory limits and
Employer's Liability in an amount not less than $1,000,000 per
occurrence and in the annual aggregate. The Employer's
Liability coverage shall not contain an occupational disease
exclusion. Such policy or policies shall contain an all states
endorsement or stop gap endorsement and alternate employer
coverage.
iii. Comprehensive Automobile Liability Coverage - Owner shall
maintain or cause to be maintained Comprehensive Automobile
Liability insurance covering all owned, non-owned and hired
vehicles used by Owner or its permissive users in connection
with Contract Services. Such coverage shall be written in an
amount not less than $1,000,000 per occurrence.
(b) Deductibles. All deductibles for the coverages specified in Section
7.3.(a), (i), (ii), and (iii) shall be the sole responsibility of
Owner, except that Operator shall be responsible for such
deductibles to the extent the claim arises out the negligence or
willful misconduct of Operator, or Operator's breach of this
Agreement, in the performance of the Contract Services not to exceed
$100,000 per occurrence pursuant to Section 7.3(a) (i) or $200,000
per occurrence pursuant to Section 7.3 (a)(ii) and (iii). Any such
deductible or self-insured retention paid by Operator shall not be
deemed to be a Reimbursable Cost hereunder.
(c) Endorsements. Any insurance provided in accordance with Section
7.3(a) shall be endorsed to provide that Operator shall be an
insured for losses occurring at the Facility or Ash Landfill with
the understanding that, except as expressly provided in Section
7.3(b), any
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obligation imposed upon Owner (including the liability to pay
premiums) shall be the sole obligation of Owner and not that of
Operator. To the extent policies are written to cover more than one
insured, all terms, conditions, insuring agreements and endorsements
(other than the limits of liability) shall operate in the same
manner as if there were a separate policy covering each insured.
7.4 Optional Insurance Responsibilities.
If requested by Owner in writing, Operator shall assist Owner in obtaining
for its own account the insurance Owner is required to maintain pursuant
to Section 7.3(a) subject to Owner reimbursing Operator for its reasonable
costs incurred in providing such assistance.
ARTICLE VIII
DISPUTE RESOLUTION
8.1 Arbitration and Mediation Standards.
(a) Any controversy or claim arising out of or relating to the
Agreement, or the breach thereof, shall be subject to resolution by
mediation or binding arbitration as set forth in this Article VIII.
(b) Prior to initiation of mediation and arbitration, the Owner
Representative and Operator Representative designated under Article
16.3 or other persons designated by the Parties shall meet for the
purposes of discussing and resolving the controversy or claim. If
the dispute is not resolved within 30 days, the Parties agree to
submit the dispute to mediation in accordance with the commercial
mediation rules of the American Arbitration Association, or other
mediation procedures agreed to by the Parties, before proceeding to
arbitration. The Parties agree to each pay one-half the costs of the
mediation.
8.2 Mediation Procedure.
(a) The Parties shall have ten days to agree upon a mutually acceptable
and neutral mediator and, if the parties cannot so agree, they shall
jointly request the American Arbitration Association or other agreed
mediation service to propose potential mediators and to assist in
the selection of a disinterested mediator.
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(b) The Parties shall, with the mediator, devise procedures appropriate
for negotiating a resolution of the dispute(s). The Parties agree to
participate in good faith in the mediation and related negotiations,
and to expeditiously exchange information and documents necessary
for the fair and full discussion of the dispute(s).
(c) The mediator shall be disqualified as a witness, consultant, expert,
or counsel for either party with respect to the dispute(s) and any
related matters. The Parties agree that the mediator shall not be
liable to either party for any statement, action or omission related
to the mediation. The mediator shall keep confidential all
information disclosed in private discussions with either Party when
that Party has requested that the information be kept confidential.
(d) The Parties agree that the mediation procedure is a compromise
negotiation for purposes of the Federal Rules of Evidence and any
State rules of evidence. The entire procedure is confidential, and
no stenographic, visual or audio record shall be made. All conduct,
statements, promises, offers, views and opinions, whether oral or
written, made in the course of the mediation by either of the
Parties, their agents, employees, representatives or other invitees
and by the mediator (who will be the Parties' joint agent for
purposes of these compromise negotiations) are confidential and
shall, in addition and where appropriate, be deemed to be work
product and privileged. Such conduct, statements, promises, offers,
views and opinions shall not be discoverable or admissible for any
purposes, including impeachment, in any litigation or other
proceeding involving the Parties, and shall not be disclosed to
anyone not an agent, employee, expert, witness, or representative of
either of the Parties; provided, however, that evidence otherwise
discoverable or admissible is not excluded from discovery or
admission as a result of its use in the mediation.
(e) The Parties agree to participate in the mediation for a period of 30
days, which period may be extended by agreement. If the Parties are
not successful in resolving the dispute(s) through mediation, then
they agree to submit the unresolved dispute(s) or portions thereof
to binding arbitration as provided in Section 8.3.
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8.3 Arbitration Procedure.
All disputes arising between the Parties which relate to the validity,
interpretation or performance of this Agreement, and which are not
successfully resolved by the Parties or through the mediation process
prescribed in Article 8.2, shall be submitted to arbitration at the
request of either party to the dispute, in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect,
and with the following provisions.
(a) The demand for arbitration shall be filed in writing with the other
party to this Agreement and with the Minneapolis, Minnesota office
of the American Arbitration Association within ten days of the
conclusion of mediation. No arbitration initiated by the Parties
shall include by consolidation, joinder or in any other manner, any
other person unless such person and both Parties agree to the
inclusion and unless such person is substantially involved in a
common question of law or fact or its presence is required if
complete relief is to be accorded in the arbitration. This agreement
to arbitrate between the Parties, and any fully executed subsequent
agreement to arbitrate with a third party, shall be specifically
enforceable under the Minnesota or federal arbitration act,
whichever is applicable.
(b) If the dispute(s) submitted to arbitration is identified as
involving claims whose total value exceeds $250,000, the Parties
shall be entitled to utilize the discovery provisions contained in
Minnesota Rules of Civil Procedure 26-37 and 45 with the following
exceptions:
(1) Each party shall be limited to three depositions unless
approval of the arbitrator(s) is obtained for additional
depositions, which approval shall only be granted upon a
showing of good cause;
(2) Each party shall be restricted to no more than 25
interrogatories, with subparts counted as separate
interrogatories.
(3) All discovery issues shall be determined by order of the
arbitrators upon motion made to them by either Party. When a
Party is asked to reveal material which the Party considers to
be proprietary information or trade secrets, the Party shall
bring the matter to the attention of the arbitrators who shall
make such protective orders as are reasonable and necessary or
as are otherwise provided by law.
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(c) The arbitrators shall have jurisdiction and authority to interpret,
apply, or determine compliance with the provisions of this Agreement
insofar as shall be necessary to the determination of issues
properly before the arbitrators. In making the decision, the
arbitrators shall issue appropriate findings and conclusions
regarding the issues. The arbitrators shall not have jurisdiction or
authority to alter the provisions of this Agreement or any
applicable law or rule of civil procedure. The arbitrators shall
have the authority to require either Party to specifically perform
its obligations under this Agreement. The arbitrators shall render a
decision within sixty (60) days after the completion of the hearing
on the matter.
(d) The arbitration shall be closed to observation or monitoring by
third parties.
(e) The award rendered by the arbitrator(s) shall be final and judgment
may be entered upon it in accordance with applicable law in any
court having jurisdiction. Any decision (including orders arising
out of disputes as to the scope or appropriateness of a request for,
or a response to, discovery) of the arbitrators may be enforced in
state or federal district court, whichever is applicable, with all
costs, including attorneys fees, paid by the losing Party. Nothing
in Article VIII shall prohibit a Party from instituting litigation
to enforce a final decision of the arbitrators.
(f) The administrative expense of any arbitration, including
compensation for the arbitrator(s), shall be borne and paid equally
by the Parties unless the arbitrator(s) finds that the position
taken by either Party on any issue is not substantially justified,
in which case all or part of the costs and fees of the Party
prevailing on that issue shall be awarded to it. Except as provided
herein, each Party shall bear its own costs and fees.
(g) All arbitration proceedings under this Article 8 shall take place in
Minneapolis, Minnesota at a location agreed upon by the Parties and,
in the event of failure to agree, the arbitrators shall determine
the most convenient location based on the location of the majority
of the documentary evidence and prospective witnesses.
(h) Pending the final decision of the arbitrators, the Parties agree to
diligently proceed with the performance of all obligations,
including the payment of all sums, required by this Agreement. To
the extent practicable and consistent with all Laws and Permits, RDF
Facility Agreements and Loan Agreement the interpretation or
decision of the
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nonaggrieved party shall take precedence until the dispute is
resolved, but shall not relieve the nonaggrieved Party from any
liability resulting from such interpretation or decision to the
extent it is ultimately determined to be wrong by the arbitrators.
(i) Nothing in this Article VIII shall preclude a Party from seeking
specific performance of this Agreement or similar injunctive relief
in state or federal court if the Party seeking such equitable relief
would otherwise be irreparably harmed by the passage of time
involved for the completion of the mediation and arbitration
processes set forth in this Article. Any judicial decree or order
granting such specific performance shall be effective only to the
extent and for the time period necessary to prevent the irreparable
harm specifically found by the court. Final resolution of any
underlying dispute, or related issues, shall still occur pursuant to
the provisions of this Article VIII.
8.4 Compromise and Settlement.
(a) Except as may be necessary for (i) any review by the MPUC, FERC, or
other Governmental Authority; or (ii) any enforcement proceeding
under Section 8.3(e), no communications sent or documents delivered
by either Party because of a proceeding under Article VIII shall be
disclosed by the other Party to a third person if that communication
or document contains the caption "Privileged and Confidential;
Settlement Proceedings" or similar caption.
(b) Except as may be necessary for (i) any review by the MPUC, FERC or
other rate regulatory agency of any matter determined to be within
its exclusive jurisdiction; or (ii) any enforcement proceeding, the
arbitrators' decision shall be deemed to be a settlement between the
Parties and the decision shall be treated as a settlement for all
purposes in the future.
8.5 Effect of Termination.
This Article VIII shall survive the termination of the Agreement as
necessary to resolve any disputes arising out of, in connection with, or
relating to the Agreement.
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ARTICLE IX
TERM
9.1 Effective Date.
This Agreement shall not become effective until the Effective Date, which
shall be the first day after all conditions precedent identified in this
Section 9.1 have been fully and satisfactorily performed and satisfied:
(a) The Agreement has been executed by authorized representatives of
Owner and Operator.
(b) Any consent to this Agreement which is required from a party to any
RDF Facility Agreement, the Loan Agreement, or the UPA Agreement has
been received in writing by Owner in a form executed by an
authorized representative of the party. Operator and Owner are not
aware of any such necessary consent at this time.
(c) The MPUC approves the Agreement in a Final Nonappealable Order,
pursuant to Minnesota Statutes Chapter 216B, in which the MPUC finds
that the amounts to be paid to Seller under the Agreement are
reasonable and in the public interest. In the event NSP is unable to
obtain a Final Nonappealable Order of the MPUC specifically
approving the Agreement without significant modification to the
Agreement by the MPUC, the Agreement shall terminate unless NSP and
Seller mutually agree in writing to accept the modification.
9.2 Term.
This Agreement shall remain in full force and effect until December 31,
2003, or until the expiration or termination of all of the RDF Facility
Agreements and UPA Agreement, whichever is earlier.
9.3 Options to Extend.
Owner shall have the option to extend the term of this Agreement for up to
two additional three (3) year terms. To exercise its options, Owner shall
provide written notice to Operator of its intent to exercise the option no
later than 180 days prior to the expiration of the Term.
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9.4 Services Prior to Effective Date.
Services provided by Operator since the Commencement Date and prior to
January 1, 1996 shall be paid for and performed in accordance with the
Administrative Agreement, including appropriate compensation or offsets
for Owner Provided Services. To the extent practicable and approved by the
MPUC the Parties shall begin performance of this Agreement as of January
1, 1996 and the First Contract Year shall be deemed to be calendar year
1996. If the MPUC fails to approve this Agreement, including the
provisions for Operator's fees, for any portion of the period between
January 1, 1996 and the Effective Date, Operator shall be entitled only to
reimbursement as allowed by the Administrative Agreement and the MPUC.
9.5 Termination.
This Agreement may be terminated only by mutual written agreement of the
Parties, pursuant to the default provisions of Article XV, or under the
following circumstances:
(a) Upon damage to, or destruction of, a substantial portion of the
Facility or Ash Landfill, which cannot reasonably be expected to be
repaired or rebuilt within one calendar year;
(b) if the Effective Date does not occur within six months of the date
this Agreement is executed.
9.6 Termination Procedure.
(a) Upon the effective date of termination of this Agreement authorized
under Section 9.5, the Operator shall (i) discontinue performance of
the Contract Services, (ii) place no further orders or subcontracts
for Materials, Equipment, Supplies, services, or labor, except as
authorized in advance by Owner or required of Operator to avoid
giving rise to an Event of Default under this Agreement, (iii) make
every reasonable effort to obtain cancellation of affected
subcontracts or, at Owner's request, cause the assignment of any
such contracts to Owner or its replacement operator upon terms
satisfactory to Owner, and (iv) take such other action as may be
reasonably requested by Owner for the orderly closeout and
transition of Operator's operation and maintenance activities,
including cooperation with any replacement operator. After deduction
of any amounts owed by Operator to Owner, upon termination pursuant
to this Article, Owner shall pay, or cause to be paid, to Operator
(A) the amount, if any due and payable to Operator pursuant to this
Agreement up to and including the date of
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termination, and (B) except in the case of a termination of Operator
pursuant to Article X, all reasonable documented costs incurred by
Operator for its own efforts to implement termination and the
resulting reasonable costs actually incurred for turnover and
demobilization, excluding any loss of anticipated profit. Such
payments to Operator shall not duplicate any other payments
hereunder made to Operator. Operator and Owner shall use reasonable
efforts to minimize all termination costs.
(b) Other than as set forth in this Section 9.6, Owner shall have no
liability to Operator for costs, expenses or losses of any kind or
nature incurred by Operator as a result of such termination. In no
event shall the aggregate payments of Owner hereunder exceed the
amount due for the then-current Contract Year, pro-rated for any
partial Contract Year. Within sixty (60) Days following the
effective date of termination, Operator shall submit to Owner its
final invoice statement which Owner shall review and make payments
on in accordance with the provisions of Article VI. Upon Operator's
receipt of final payment in full from Owners, this Agreement shall
terminate and neither Party shall have any further obligation to the
other Party except with respect to those provisions of this
Agreement which by their terms survive.
ARTICLE X
INDEMNIFICATION
10.1 Indemnity.
Operator and Owner agree to defend, indemnify, and hold each other, and
their respective officers, directors, employees, and agents, harmless from
and against all claims, demands, losses, liabilities, and expenses
(including reasonable attorneys' fees) (collectively "Damages") for
personal injury or death to persons and damage to each other's physical
property or facilities or the property of any other person or corporation
to the extent arising out of, resulting from, or caused by the negligent
or intentional acts, errors, or omissions of the indemnifying Party.
Furthermore, each Party shall defend, indemnify, and hold the other
harmless from and against all damages that are or were incurred or
suffered by the indemnified Party and which relate to the indemnifying
Party's breach or failure to perform any of the covenants, agreements,
obligations, representations, or warranties contained in the Agreement,
except as provided in Section 10.2. Nothing in this section shall relieve
Operator or Owner of any liability to the other for any breach of the
Agreement. This indemnification shall apply notwithstanding the active or
passive negligence of the indemnitee. Neither Party shall be indemnified
to
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the extent its Damages result from its sole negligence or willful
misconduct. These indemnity provisions shall not be construed to relieve
any insurer of its obligation to pay claims consistent with the provisions
of a valid insurance policy.
10.2 Limitation of Liability.
(a) For all claims, causes of action and damages the Parties shall be
entitled to the recovery of actual damages allowed by law unless
otherwise limited by the Agreement.
(b) Except as otherwise specifically and expressly provided in the
Agreement, no Party shall be liable to the other Party under the
Agreement for any indirect, special, or consequential damages,
including but not limited to, loss of use, loss of revenue, loss of
profit, interest charges, cost of capital, or claims of its
customers to which service is made from any cause, except to the
extent such damages are covered under an insurance policy for the
benefit of the liable Party. Notwithstanding the foregoing, the
arbitrators under Article VIII can award consequential damages
against a Party which willfully violates its obligations under the
Agreement with knowledge that the other Party is suffering
consequential damages if the arbitrators determine that such an
award appears necessary to prevent repetition of such willful
misconduct. In no event shall one Party's liability to the other
exceed any limit of liability established for either Party under any
Requirement of law.
(c) Notwithstanding the limitation set forth in Section 10.2(b),
Operator shall be liable for all damages, including, but not limited
to, loss of use, loss of revenue, loss of profit, and other
indirect, special or consequential damages suffered or incurred by
Owner, directly or through claims or causes of actions by others,
arising from or relating to the occurrence of any breach, event of
default, or failure to comply with the terms of any RDF Facility
Agreement, UPA Agreement or Loan Agreement to the extent caused by
Operator's negligent acts or omissions, willful misconduct, or
breach of this Agreement.
10.3 Survival.
The indemnity obligation of Section 10.1 and any other indemnity
obligation provided under this Agreement shall survive the expiration of
the term or termination of this Agreement for any reason and shall remain
in full force and effect. All waivers and disclaimers of liability,
releases from liability and limitations on liability shall also survive
the expiration of the Term or
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termination of the Agreement and shall apply at all times unless otherwise
expressly indicated.
10.4 Notice of Litigation.
If any Party indemnified pursuant to this Article X or otherwise under
this Agreement (each an "Indemnified Party" and collectively the
"Indemnified Parties") receives notice or acquires knowledge of any claim
that may reasonably result in a claim for indemnification by such
Indemnified Party against the other Party (the "Indemnifying Party")
pursuant to this Article X or otherwise, the Indemnified Party shall, as
promptly as possible, give the Indemnifying Party notice of such claim,
including a reasonably detailed description of the facts and circumstances
relating to such claim, and a complete copy of all notices, pleadings and
other papers related thereto, and the basis for its potential claim for
indemnification in reasonable detail and shall cooperate with the
Indemnifying Party in responding to the claim.
Subject to the limitations on the Indemnifying Party's indemnity
obligations, the Indemnifying Party shall assume on behalf of the
Indemnified Party, and conduct with due diligence and good faith the
defense of, any suit against one or more of the Indemnified Parties,
whether or not the Indemnifying Party is joined as a party. Without
relieving the Indemnifying Party of its obligations and subject to the
Indemnifying Party's control over the defense and settlement of any suit,
the Indemnified Party may elect to participate in the defense of any suit,
at its own expense. The Indemnifying Parties' indemnity is for the
exclusive benefit of the Indemnified Parties and their assignees and in no
event shall inure to the benefit of any other Person.
10.5 Cost Treatment.
Any amounts paid by Operator to Owner or otherwise arising from or related
to any indemnified claim pursuant to Section 10.1 or other indemnity
obligations of this Agreement shall not be Reimbursable Costs and shall be
paid at Operator's sole cost and expense.
10.6 Limitation of Liability.
With the exception of liabilities arising from Operator's indemnity and
similar obligations pursuant to Section 10.1, 3.17, 6.4, 6.8, 11.4 and
13.3, and the payment of deductibles for coverage provided under Section
7.2(b) which are expressly not governed by this Section, Operator's
aggregate liability to Owner with respect to any and all claims arising
out of the performance or nonperformance of its obligations under this
Agreement, whether based in
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contract, tort, warranty or otherwise shall not exceed, net of all
insurance proceeds applied to each such liability or related claim:
(i) For all claims arising and for which damages accrue solely within
one Contract Year, the amount of $1,000,000 or the total of the
Management Fee and Performance Bonus due to Operator for that
Contract Year, whichever is less.
(ii) for all claims made or for which damages accrue on a continuing
basis or over more than one Contract Year, the amount of $3,000,000
multiplied by the number of Contract Years or the total of the
Management Fee and Performance Bonus due to Operator for the
affected Contract Year, less any amounts paid pursuant to the
preceding subparagraph (i) for each of the Contract Years whichever
is less.
ARTICLE XI
REPRESENTATIONS AND WARRANTIES
11.1 Representations by Operator.
Operator represents and warrants to Owner:
(a) (i) Operator is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its formation;
(ii) has the power and authority to own and operate its business
and property, to own or lease the property it occupies and to
conduct the business in which it is currently engaged;
(iii) is duly qualified as a corporation in Delaware and is in good
standing under the laws of Minnesota and each jurisdiction
where its ownership, lease or operation of property or the
conduct of its business requires such qualification and the
failure to be so qualified would have a material adverse
affect on the business, operations, financial condition or
prospects of Operator;
(iv) is in compliance with all material Requirements of Law,
applicable to Operator or its operations; and
(v) is in compliance with all material Contractual Obligations
applicable to Operator or its operations.
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(b) The execution, delivery, performance and observance by Operator of
its obligations under the Agreement is within Operator's powers,
have been duly authorized by all necessary corporate action and do
not and will not:
(i) require any consent or approval of the shareholders of
Operator which has not been obtained;
(ii) contravene, conflict or violate any provision of any
Requirement of Law presently in effect having applicability to
Operator;
(iii) require the consent or approval of or filing or registration
with any Governmental Authority or other Person which is not
specified as a condition precedent to the Agreement;
(iv) result in a breach of or constitute a default under any
Contractual Obligation.
(c) The Agreement is a legal, valid and binding obligation of Operator,
is enforceable against Operator in accordance with its respective
terms except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally.
(d) No litigation, arbitration, investigation or other proceeding is
pending or threatened against Operator, except as listed on Exhibit
E,
(i) with respect to the Agreement or the transaction contemplated
thereby, the Facility, Ash Landfill, RDF Facility Agreements,
UPA Agreement or Loan Agreement; or
(ii) which would, if adversely determined, have a material adverse
effect on the business, operations, property or financial or
other condition of Operator taken as a whole, or the ability
of Operator to perform its obligations under the Agreement.
(e) To the best of Operator's knowledge and belief, no exhibit,
contract, report or document furnished by Operator to Owner in
connection with the negotiation or execution of the Agreement
contains any material misstatement of fact or omits to state a
material fact or any fact necessary to make the statements contained
therein not misleading.
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(f) To the best of Operator's knowledge and belief, all Permits required
by any Governmental Authority for the operation and maintenance of
the Facility and Ash Landfill have been obtained and are valid and
in full force and effect. The Facility and Ash Landfill are in
compliance with each Permit as of the date of this Agreement, and
Operator has received no notice and is not otherwise aware of any
default, violation or potential default or violation of any such
Permit.
(g) Operator has filed or caused to be filed all tax returns which were
required to be filed and has paid all taxes shown to be due and
payable on said returns or on any assessments made against it or any
of its property and all other taxes, fees or other charges imposed
on it or any of its property by any Governmental Authority; and no
tax liens have been filed and no claims are being asserted with
respect to any such taxes, fees or other charges.
(h) The Facility and Ash Landfill have been and are currently operated
in full compliance with all Environmental Laws and operated in full
compliance with all Permits, licenses, rules or orders promulgated,
issued or otherwise required by a Governmental Authority having
jurisdiction or enforcement power over any Environmental Law.
Operator has no knowledge of and has not received notice of any
past, present or future actions or plans which, with respect to the
Facility or Ash Landfill, may interfere with or prevent compliance
or continued compliance with Environmental Laws or may give rise to
any liability under any Environmental Law or to any common law or
legal liability or otherwise form the basis of any claim, action,
demand, suit, proceeding, hearing, study or investigation under the
Environmental Laws and there is no civil, criminal or administration
action, suit, demand, claim, hearing notice or demand letter, notice
of violation, investigation or proceeding pending or threatened
against Operator relating to the compliance with any Environmental
Law of the Facility or Ash Landfill.
(i) Operator intends to operate and maintain the Facility and Ash
Landfill in accordance with the Standards of Performance, applicable
Laws and Permits, the RDF Facility Agreements, Loan Agreement, and
the terms of this Agreement.
(j) No Event of Default or Potential Event of Default exists hereunder.
11.2 Owner's Representations.
Owner represents and warrants to Operator:
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(a) (i) Owner is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its formation;
(ii) has the power and authority to own and operate its business
and property, to own or lease the property it occupies and to
conduct the business in which it is currently engaged;
(iii) is duly qualified as a corporation in Minnesota and is in good
standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of
its business requires such qualification and the failure to be
so qualified would have a material adverse affect on the
business, operations, financial condition or prospects of
Owner;
(iv) is in compliance with all material Requirements of Law,
applicable to Owner or its operations; and
(v) is in compliance with all material Contractual Obligations
applicable to Owner or its operations.
(b) The execution, delivery, performance and observance by Owner of its
obligations under the Agreement is within Owner's powers, have been
duly authorized by all necessary corporate action and do not and
will not:
(i) require any consent or approval of the shareholders of Owner
which has not been obtained;
(ii) contravene, conflict or violate any provision of any
Requirements of Law presently in effect having applicability
to Owner;
(iii) require the consent or approval of or filing or registration
with any Governmental Authority or other Person which is not
specified as a condition precedent to the Agreement;
(iv) result in a breach of or constitute a default under any
Contractual Obligation.
(c) The Agreement is a legal, valid and binding obligation of Owner, is
enforceable against Owner in accordance with its respective terms
except as enforceability may be limited by applicable bankruptcy,
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insolvency, reorganization or similar laws affecting the enforcement
of creditors' rights generally.
(d) No litigation, arbitration, investigation or other proceeding is
pending or threatened against Owner, except as listed on Exhibit E.
(i) with respect to the Agreement or the transaction contemplated
thereby, the Facility, Ash Landfill, RDF Facility Agreements,
UPA Agreement or Loan Agreement; or
(ii) which would, if adversely determined, have a material adverse
effect on the business, operations, property or financial or
other condition of Owner taken as a whole, or the ability of
Owner to perform its obligations under the Agreement.
(e) To the best of Owner's knowledge and belief, no exhibit, contract,
report or document furnished by Owner to Operator in connection with
the negotiation or execution of the Agreement contains any material
misstatement of fact or omits to state a material fact or any fact
necessary to make the statements contained therein not misleading.
(f) Prior to the Commencement date, the Facility and Ash Landfill were
operated in full compliance with all Environmental Laws and operated
in full compliance with all Permits, licenses, rules or orders
promulgated, issued or otherwise required by a Governmental
Authority having jurisdiction or enforcement power over any
Environmental Law. Owner has no knowledge of and has not received
notice of any past, present or future actions or plans which, with
respect to the Facility or Ash Landfill, may interfere with or
prevent compliance or continued compliance with Environmental Laws
or may give rise to any liability under any Environmental Law or to
any common law or legal liability or otherwise form the basis of any
claim, action, demand, suit, proceeding, hearing, study or
investigation under any Environmental Law and there is no civil,
criminal or administration action, suit, demand, claim, hearing
notice or demand letter, notice of violation, investigation or
proceeding pending or threatened against Owner relating to the
compliance with any Environmental Law of the Facility or Ash
Landfill.
11.3 Owner's and Operator's Reliance.
Operator agrees and acknowledges that Owner is relying on and will
continue to rely on Operator's representations and warranties and, that
such reliance
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is reasonable, and that Owner will rely on such representations in its
filings and presentations to the MPUC in connection with this Agreement.
Owner agrees and acknowledges that Operator is relying on and will
continue to rely on Owner's representations and warranties and that such
reliance is reasonable.
11.4 Indemnity
If at any time during the Term of the Agreement any of the representations
and warranties made by either of the Parties are or become untrue, then
the Party which made the representation or warranty agrees to indemnify
and hold harmless the other Party against any and all claims, demands,
suits, actions, costs, and liabilities, damages, losses or judgments
arising out of, relating to or resulting from any such untrue
representation or warranty, as well as against any fees, costs, charges,
or expenses (including attorneys' fees) which the other Party might incur
in the defense of any such claim, suit, action or similar such demand made
or filed which may adversely affect the other Party as a consequence of
the untrue representation or warranty.
ARTICLE XII
FORCE MAJEURE
12.1 Force Majeure.
Neither Operator nor Owner shall be liable to the other for any failure
to perform pursuant to the terms and conditions of this Agreement to the
extent such performance was prevented by an event of Force Majeure. Force
Majeure as used in this Agreement means any event beyond the reasonable
control of the Party affected and which, with the exercise of due care,
the Party could not reasonably have been expected to avoid, including, but
not limited to, acts of God, explosions or fires, floods, hurricanes,
tornadoes, lightning, earthquakes, drought, epidemics, blight, famine,
quarantine, blockade, acts or inactions of Governmental Authorities, war,
insurrection or civil strife, rebellion, sabotage or strike. To be excused
from performance pursuant to this provision, however, the Party affected
must (i) give notice to the other Party, including full details of the
event of Force Majeure and its creation of an inability to perform, as
soon as practicable after the occurrence relied upon and (ii) exercise due
diligence to remove its inability to perform with all reasonable speed and
using all reasonable measures. The burden of proof to establish the
existence of an event of Force Majeure and any resulting inability to
perform on its part shall be on the Party seeking an excuse from
performance due to Force Majeure.
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12.2 Exclusions from Definition of Force Majeure.
Notwithstanding anything in the Agreement to the contrary, "Force Majeure"
shall not mean:
(a) Inclement weather affecting operation or maintenance of the Facility
or Ash Landfill.
(b) Changes in market conditions, governmental action, or weather
conditions that affect the cost of Operator's Contract Services,
Equipment, Materials, or Supplies.
(c) Unavailability of equipment, repairs or spare parts for the
Facility, Facility Equipment, Ash Landfill or Ash Landfill
Equipment, except where due to a strike against a third person which
was not reasonably foreseeable, and the consequences of which could
not be avoided by due care and planning.
(d) Inability to obtain, maintain or renew any Permit or any delay in
obtaining, maintaining, or renewing any Permit for any reason within
the control of the Party.
(e) Litigation or administrative or judicial action pertaining to the
Agreement, to the RDF Facilities, the acquisition, maintenance or
renewal of financing or any Permits, or the maintenance or operation
of the RDF Facilities.
(f) Any event to the extent caused by the negligence, willful misconduct
or breach of this Agreement by the Party claiming Force Majeure.
(g) Any event to the extent it could have been prevented by reasonable
diligence or was otherwise within the control of the Party claiming
Force Majeure.
(h) Any breakdown or failure of any mechanical or other component of the
Facility, Ash Landfill, Facility Equipment or Ash Landfill Equipment
which fully or partially curtails operations to the extent caused by
the design or construction of the component or the failure to
properly operate and maintain the component, irrespective of whether
the failure is attributable to the negligence or fault of the Party
asserting Force Majeure.
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(i) Failure to perform by any subcontractor, vendor, manufacturer,
supplier, provider or other third party unless the failure is also
caused by a qualifying event of Force Majeure as defined in this
Agreement. In this respect, the compliance of any Person contracting
with Operator or Owner with the terms of the applicable contract,
purchase order or other agreement shall be deemed to be within the
control of Owner or Operator, as applicable.
ARTICLE XIII
HAZARDOUS MATERIALS
13.1 Environmental Laws.
Any terms mentioned in the following subsections which are defined in
state local, or federal environmental statutes and/or regulations
promulgated in relation thereto shall have the meaning subscribed to such
terms in said statutes and regulations. These state, local and federal
environmental statutes, rules and regulations include, without limitation,
(1) the Comprehensive Environmental Response, Compensation, and Liability
Act (CERCLA), 42 U.S.C. Sections 9601-9657; (2) the 1986 Superfund
Amendments and Reauthorization Act (XXXX), codified as a part of 41 U.S.C.
Section 9601 et seq.; (3) the Minnesota Environmental Response and
Liability Act (XXXXX), Minn. Stat. Sections 115B.01-115B.17; (4) the
Resource Conservation and Recovery Act (RCRA), 42 U.S.C. Sections
6901-6987; (5) legislation and regulations governing underground storage
tanks (UST), including applicable federal laws and the Minnesota Petroleum
Tank Release Clean-Up Act, Minn. Stat. Sections 115C.01-115C.10; and (6)
state and federal laws creating any liens for clean-up costs, including
applicable provisions of XXXX and comparable Minnesota laws, Minn. Stat.
Sections 514.671-514.676; (7) Groundwater Protection Act, Minn. Stat.
Sections 103H.001-103H.280; (8) the Clean Air Act, 42 U.S.C. Sections 7401
et seq.; (9) the federal Clean Water Act, 33 U.S.C. Sections 1321 et seq.;
(10) the Hazardous Materials Transportation Act, 49 U.S.C. Sections 1802
et seq.; (11) the Toxic Substances Control Act, 15 U.S.C. Sections 2601 et
seq.; (12) the federal Water Pollution Control Act, 15 U.S.C. Sections
2601 et seq.; and (13) any federal, state, county, municipal, local or
other statute, law, ordinance or regulation enforcing, governing or
related to the creation, handling, release, containment, transport or
disposal of any pollutant, contaminant, hazardous or unhealthy substance
or to human health or the environment; and any regulations interpreting,
applying or complementing each of the statutes described in clauses (1)
through (13). These statutes, rules and regulations, as amended from time
to time, are referred to collectively as the "Environmental Laws."
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The term "release" shall have the meaning specified in CERCLA and XXXXX,
and the terms "solid waste" and "disposal" (or "disposed") shall have the
meanings specified in RCRA; provided, in the event CERCLA, XXXX, RCRA,
XXXXX or MPTRCA is amended so as to broaden the meaning of any term
defined thereby, such broader meaning shall apply subsequent to the
effective date of such amendment. "Hazardous Materials" means asbestos,
ureaformaldehyde, polychlorinated biphenyls ("PCBs"), nuclear fuel or
material, chemical waste, radioactive material, explosives, known
carcinogens, petroleum products and by-products and other dangerous, toxic
or hazardous pollutants, contaminants, chemicals, materials or substances
listed or identified in, or regulated by, any Environmental Laws.
13.2 Owner's Indemnity.
Owner agrees to indemnify, defend and hold Operator harmless from and
against any claim, suit, loss, cost, liability, fine or damage (including
reasonable attorneys' fees) arising from or assessed or incurred as a
result of any release or other violation of any Environmental Law based on
conditions existing at the Facility Site or Ash Landfill Site or created
prior to the Commencement Date, made or asserted by any Person, and
whether or not supported by fact or law.
13.3 Operator's Indemnity.
Operator agrees to indemnify, defend and hold Owner harmless from and
against any claim, suit, loss, cost, liability, fine or damage (including
reasonable attorneys' fees) arising from or assessed or incurred as a
result of any release or other violation of any Environmental Law based on
releases or other conditions occurring or created at the Facility Site or
Ash Landfill Site after the Commencement Date, including, but not limited
to, any negligent or culpable handling of Hazardous Materials in the
course of performing the Contract Services, made or asserted by any
Person, and whether or not supported by fact or law.
13.4 Hazardous Wastes.
Operator shall arrange for the proper collection, removal, transportation,
and disposal of any Hazardous Materials furnished, used, applied,
generated or stored at the RDF Facilities or emanating from the RDF
Facilities including, but not limited to, used oils, greases, and solvents
from flushing and cleaning processes performed under this Agreement. All
costs associated with the transportation and disposal of Hazardous
Materials to or from the RDF Facilities by Operator in connection with its
performance of the Contract
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Services pursuant to the terms of this Agreement shall be a Reimbursable
Cost. Operator shall comply with all applicable Laws and Permits in
collecting, handling, removing, transporting or disposing of any Hazardous
Materials, and shall be responsible for determining whether any material
or substance is a Hazardous Materials and for interpreting and applying
any Environmental Law.
ARTICLE XIV
DEFAULT
14.1 Events of Default.
The following occurrences or events, or any of them, by or against either
Operator or Owner, shall constitute an Event of Default under this
Agreement.
(a) A material breach of any of the terms, conditions, warranties,
covenants, or representations expressed in this Agreement; or
(b) the filing of a petition commencing a voluntary case under the
Federal Bankruptcy Code or for liquidation, reorganization or any
similar arrangement under federal or state law relating to
bankruptcy, insolvency, winding up or adjustment of debts; or
(c) the admission in writing of its insolvency or inability to pay its
debts generally as they become due or the acquiescence in or consent
to any involuntary case commenced as described in Section 15.1(d)
or the declaration of such Party as bankrupt or insolvent under the
Federal Bankruptcy code or any other federal or state law relating
to bankruptcy, insolvency, winding up or adjustment of debts; or
(d) the filing of a petition against it commencing an involuntary case
under the Federal Bankruptcy Code or proposing the adjudication of
such Party as a debtor or bankrupt or proposing its liquidation or
reorganization pursuant to any federal or state law relating to
bankruptcy, insolvency, winding up or adjustment of debts; or
(e) the dissolution of any Party or failure to maintain such Party's
good standing or qualification to do business in the State of
Minnesota or state of organization; or
(f) an assignment for the benefit of creditors.
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(g) with respect to the Operator, an Event of Default occurs under any
of RDF Facility Agreements or Loan Agreement due to the negligent or
intentional acts or omissions of the Operator or Operator's breach
of this Agreement.
14.2 Notice of Event of Default and Cure Rights.
(a) For any Event of Default arising under Sections 15.1(a) and (e),
the right of termination granted under Section 15.3 shall be subject
to a written notice of the Event of Default. Unless the nature of
the default requires more immediate action to cure, which shall be
set forth in the notice, the defaulting Party shall be provided
thirty (30) calendar days from the date of receipt of the notice to
cure the Event of Default. Failure to cure the default within this
thirty (30) day period shall constitute a material breach of the
Agreement granting to the nondefaulting Party the right to terminate
the Agreement pursuant to Section 15.3.
(b) For any Event of Default described by Sections 15.1(b), (c), (d)
and (f), notice of default shall not be required and termination may
be effected in accordance with Section 15.3 by the nondefaulting
Party to the extent permitted by applicable law.
(c) For any Event of Default by Operator pursuant to Section 15.1(g),
Owner shall immediately provide written notice to Operator of the
Event of Default, along with a copy of any notice of default
received by Owner with respect to the underlying agreement in
default or a description of the default in reasonable detail.
Operator shall have the balance of any cure period provided to Owner
under the agreement in default to cure the underlying default. If
Operator fails to cure the underlying default within the available
cure period, Owner shall have the right to terminate this Agreement
pursuant to Section 15.3.
14.3 Termination; Waiver.
(a) In the event the defaulting Party fails to correct the Event of
Default within the period for curative action under Section 15.2 of
the Agreement with respect to the Events of Default outlined in
Sections 15.1(a), (e) and (g) or upon the occurrence of any other
Event of Default set forth in Sections 15.1(b), (c), (d) and (f) or
15.5, the nondefaulting Party may terminate the Agreement at its
sole discretion by notifying the defaulting Party in writing of the
nondefaulting Party's intent to terminate the Agreement and of the
effective date of such termination.
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(b) Upon the occurrence of an Event of Default or subsequent termination
resulting from an Event of Default, the nondefaulting Party shall
have the right to pursue any and all legal and equitable remedies,
including specific performance and including all actual damages and
remedies as provided under the Agreement or related documents,
against the defaulting Party and shall be entitled to recover from
the defaulting Party all expenses (including reasonable attorneys'
fees) incurred by the nondefaulting Party in connection with the
pursuit of such remedies.
(c) Any waiver at any time by either Party of its rights with respect to
an Event of Default under the Agreement, or with respect to any
other matters arising in connection with the Agreement, shall not be
a waiver with respect to any subsequent default or other matter.
14.4 Obligations Upon Termination.
In the event that Owner elects to terminate this Agreement as a result of
Operator's default and without limiting any other right or remedy of
Owner, Owner may employ any other person, firm or corporation to perform
the Contract Services by whatever method Owner may deem expedient.
Furthermore, Operator shall, at Owner's expense, perform the following
services relative to the Contract Services affected by its default,
regardless of whether or not Owner elects to terminate this Agreement as a
result of such default:
(a) assist Owner in preparing an inventory of all Equipment, Materials,
or Supplies in use or in storage at the Facility and Ash Landfill;
and
(b) assign to Owner such subcontracts and other contractual agreements
relating to Operator's performance of the Contract Services as may
be designated by Owner. Furthermore, Operator shall execute all
documents reasonably requested by Owner and take such other steps as
are reasonably requested by Owner that may be required to assign and
vest in Owner or its designee all rights, benefits, interests and
title in connection with the contracts or obligations; and
(c) For a period not to exceed 90 days, assist Owner in training
Operator's successor and effectuating the transition to a successor
Operator.
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ARTICLE XV
MISCELLANEOUS
15.1 Non-Assignment.
The rights and obligations of this Agreement may not be assigned by either
Party without the prior written consent of the other Party, which consent
shall not be unreasonably withheld. Any purported assignment of this
Agreement in the absence of the required consent shall be void.
15.2 Notices.
Any notice, demand, request, or communication required or authorized by
the Agreement shall be delivered either by hand, facsimile, overnight
courier or mailed by certified mail, return receipt requested, with
postage prepaid, to:
Northern States Power Company
000 Xxxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Attn:______________
on behalf of Owner; and to:
NRG Energy, Inc.
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxxx, XX 00000-0000
Attn:_____________________
on behalf of the Operator. The designation and titles of the person to be
notified or the address of such person may be changed at any time by
written notice. Delivery of any such notice, demand, request, or
communication shall be deemed delivered on receipt if delivered by hand or
facsimile and on deposit by the sending party if delivered by courier or
U.S. mail.
15.3 Captions.
All titles, subject headings, section titles and similar items are
provided for the purpose of reference and convenience and are not intended
to be inclusive, definitive or to affect the meaning of the contents or
scope of the Agreement or any of its provisions.
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15.4 No Third-Party Beneficiary.
No provision of the Agreement is intended to nor shall it in any way inure
to the benefit of any third party, so as to constitute any such person a
third-party beneficiary under the Agreement, or of any one or more of the
terms hereof, or otherwise give rise to any cause of action in any person
not a Party hereto.
15.5 Entire Agreement Modification and Waiver.
The Agreement, together with all exhibits attached hereto, constitutes the
entire agreement between the Parties relating to the transaction described
and supersedes any and all prior oral or written understandings. No
amendment, addition to, or modification of any provision hereof shall be
binding upon the Parties, and neither Party shall be deemed to have waived
any provision of any remedy available to it unless such amendment,
addition, modification or waiver is in writing and signed by a duly
authorized officer or representative of the applicable Party or Parties.
15.6 Governing law.
The Agreement is made in the State of Minnesota and shall be interpreted
and governed by the laws of the State of Minnesota without giving effect
to its conflict of law provisions, and/or the laws of the United States,
as applicable.
15.7 Contract Drafting.
The Parties expressly agree that neither Party shall be deemed solely
responsible for drafting all or any portion of the Agreement and, in the
event of a dispute, responsibility for any ambiguities arising from any
provision of the Agreement shall be shared equally by both Parties.
15.8 Form of Business Relationship.
(a) The duties, obligations, and liabilities of the Parties are intended
to be several and not joint or collective. The Agreement shall not
be interpreted or construed to create an association, joint venture,
fiduciary relationship or partnership between Operator and Owner or
to impose any partnership obligation or liability or any trust or
agency obligation or relationship upon either Party. Operator and
Owner shall not have any right, power, or authority to enter into
any agreement or undertaking for, or act on behalf of, or to act as
or be an agent or representative of, or to otherwise bind, the other
Party.
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(b) The relationship between Owner and Operator shall be that of
contracting party to independent contractor. Accordingly, subject to
the specific terms of the Agreement, Owner shall have no general
right to prescribe the means by which Operator shall meet its
obligations under the Agreement.
(c) Operator shall be solely liable for the payment of all wages, taxes,
and other costs related to the employment of persons to perform
Operator's obligations under the Agreement, including all federal,
state, and local income, social security, payroll, and employment
taxes, and statutorily mandated workers' compensation coverage. None
of the persons employed by Operator shall be considered employees of
Owner for any purpose; nor shall Operator represent to any person
that he or she is or shall become an employee or agent of Owner.
15.9 Good Faith and Fair Dealing: Reasonableness.
The Parties agree to act reasonably and in accordance with the principles
of good faith and fair dealing in the performance of the Agreement. Unless
expressly provided otherwise in this Agreement, (i) wherever the Agreement
requires the consent, approval, or similar action by a Party, such
consent, approval or similar action shall not be unreasonably withheld or
delayed, and (ii) wherever the Agreement gives a Party a right to
determine, require, specify or take similar action with respect to
matters, such determination, requirement, specification or similar action
shall be reasonable.
15.10 Severability.
Should any provision of the Agreement be or become void, illegal, or
unenforceable, the validity or enforceability of the other provisions of
the Agreement shall not be affected and shall continue in force. The
Parties will, however, use their best endeavors to agree on the
replacement of the void, illegal, or unenforceable provision(s) with
legally acceptable clauses which correspond as closely as possible to the
sense and purpose of the affected provision and the Agreement as a whole.
15.11 Confidentiality.
The Agreement and exhibits incorporated by reference, and all amendments
shall be considered proprietary and shall not be provided to a third party
without prior written approval of the other Party, unless a Party is
required to disclose such information by law or court order or when such
information is already in the public domain. In the event certain
information must be
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provided pursuant to a regulatory proceeding, the Parties shall take
reasonable steps to protect the confidentiality of proprietary
information.
15.12 Cooperation.
The Parties agree to reasonably cooperate with each other in the
implementation and performance of the Agreement. Such duty to cooperate
shall not require either Party to act in a manner inconsistent with its
rights under the Agreement.
15.13 Successors and Assigns.
This Agreement shall be binding upon the Parties, their successors and
permitted assignees.
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
as of the day and year first written above.
NORTHERN STATES POWER COMPANY,
a Minnesota corporation
By:
-------------------------------------
Its: President, NSP Electric
NRG ENERGY, INC., a Delaware corporation
By:
-------------------------------------
Its: Vice President Ops & Engr.
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