Exhibit 10.1

FIXED PRICE SEPARATED TURNKEY AGREEMENT

for the

ENGINEERING, PROCUREMENT AND CONSTRUCTION

of the

CORPUS CHRISTI LIQUEFACTION STAGE 3 PROJECT

by and between

CORPUS CHRISTI LIQUEFACTION STAGE III, LLC

as Owner

and

BECHTEL ENERGY INC.

as Contractor


Dated as of the 1st Day of March 2022


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TABLE OF CONTENTS
Page
ARTICLE 1DEFINITIONS1
1.2Interpretation25
ARTICLE 2RELATIONSHIP OF OWNER, CONTRACTOR AND SUBCONTRACTORS25
2.1Status of Contractor25
2.2Key Personnel, Organization Chart and Contractor Representative25
2.3Subcontractors and Sub-subcontractors26
2.4Subcontracts and Sub-subcontracts26
2.5Contractor Acknowledgements29
ARTICLE 3CONTRACTOR’S RESPONSIBILITIES32
3.1Scope of Work32
3.2Specific Obligations32
3.3Design and Engineering Work34
3.4Spare Parts36
3.5Training Program in General37
3.6Environmental Regulations and Environmental Compliance37
3.7Contractor’s Tools and Construction Equipment38
3.8Employment of Personnel38
3.9Clean-up39
3.10Safety and Security40
3.11Emergencies41
3.12Approvals, Certificates, Permits and Licenses41
3.13Books, Records and Audits42
3.14Tax Accounting43
3.15Temporary Utilities, Roads, Facilities and Storage43
3.16Subordination of Liens44
3.17Hazardous Materials44
3.18Quality Assurance46
3.19Reports and Meetings47
3.20Payment48
3.21Commercial Activities48
3.22Title to Materials Found48
3.23Survey Control Points and Layout48
3.24Cooperation with Others49
3.25Responsibility for Property50
3.26Explosives50
3.27Interference and Integration50
3.28Equipment Not Incorporated into the Stage 3 Facility52
3.29Operation Personnel53
3.30Compliance with Real Property Interests53
3.31Taxes53
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3.32Electronic File Sharing Site53
ARTICLE 4OWNER’S RESPONSIBILITIES54
4.1Payment54
4.2Permits54
4.3Access to the Site, Supporting Real Estate and CCL Liquefaction Facility Site54
4.4Operation Personnel55
4.5Legal Description and Survey55
4.6Owner-Furnished Items55
4.7Owner Representative56
4.8Texas Sales and Use Tax56
4.9Hazardous Materials57
4.10Insurance58
ARTICLE 5COMMENCEMENT OF WORK, GUARANTEED DATES, AND SCHEDULING OBLIGATIONS58
5.1Limited Notice to Proceed58
5.2Notice to Proceed59
5.3Guaranteed Dates61
5.4Project Schedule62
5.5Recovery and Recovery Schedule64
5.6Acceleration and Acceleration Schedule65
ARTICLE 6CHANGES; FORCE MAJEURE; AND OWNER CAUSED DELAY66
6.1Owner’s Right to Change Order66
6.2Contractor’s Right to Change Orders69
6.3Changed Criteria Adjustment; Contractor Documentation71
6.4Change Orders Act as Accord and Satisfaction72
6.5Timing Requirements for Change Notices Issued by Contractor72
6.6Adjustment Only Through Change Order73
6.7Force Majeure74
6.8Delay Caused by Owner, etc. for Which Owner Is Responsible, Time Extensions and Compensation Adjustments75
6.9Work Activity on the Critical Path77
6.10Delay77
6.11Contractor Obligation to Mitigate Delay77
6.12Separated Contract Price Adjustments in Change Orders77
6.13COVID-19 Provisional Sum and COVID-19 Events77
ARTICLE 7CONTRACT PRICE AND PAYMENTS TO CONTRACTOR79
7.1Contract Price79
7.2Interim Payments80
7.3Final Completion and Final Payment85
7.4Payments Not Acceptance of Work85
7.5Payments Withheld85
7.6Payment of Amounts Withheld or Collected on Letter of Credit87
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7.7Interest on Late Payments87
7.8Offset88
7.9Currency88
7.10Currency Conversion88
7.11Fuel Adjustment88
7.12Conditions Precedent to Payment89
7.13Relief for Non-U.S. Duties and Tariffs90
ARTICLE 8TITLE AND RISK OF LOSS91
8.1Title91
8.2Risk of Loss91
ARTICLE 9INSURANCE AND LETTER OF CREDIT93
9.1Insurance93
9.2Irrevocable Standby Letter of Credit94
ARTICLE 10OWNERSHIP OF DOCUMENTATION97
10.1Ownership of Work Product97
10.2Contractor’s Intellectual Property and Third Party Intellectual Property98
10.3Limitations on Use of Work Product99
10.4Owner Provided Documents100
10.5License to Use Liquefaction and Other Process Technology100
10.6Licensors100
ARTICLE 11COMPLETION AND PERFORMANCE LIQUIDATED DAMAGES102
11.1Notice and Requirements for RFSU and RFFGI102
11.2Notice and Requirements for Substantial Completion of a Train.102
11.3Owner Acceptance of RFFGI, RFSU, and Substantial Completion103
11.4Performance Guarantees and Minimum Acceptance Criteria104
11.5Punchlist105
11.6Notice and Requirements for Final Completion106
11.7Partial Occupancy and Use107
11.8Operations Activities108
11.9Long-Term Obligations108
ARTICLE 12WARRANTY AND CORRECTION OF WORK108
12.1Warranty108
12.2Inspection of Work110
12.3Correction of Work111
12.4Assignability of Warranties114
12.5Waiver of Implied Warranties and Exclusive Warranties / Remedies114
ARTICLE 13GUARANTEE OF TIMELY COMPLETION, DELAY LIQUIDATED DAMAGES AND SCHEDULE BONUS114
13.1Delay Liquidated Damages114
13.2Payment of Liquidated Damages115
13.3Schedule Bonus116
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ARTICLE 14CONTRACTOR’S REPRESENTATIONS117
14.1Contractor Representations117
ARTICLE 15OWNER’S REPRESENTATIONS118
15.1Owner Representations118
ARTICLE 16DEFAULT, TERMINATION AND SUSPENSION119
16.1Default by Contractor119
16.2Termination for Convenience by Owner122
16.3Suspension of Work122
16.4Suspension by Contractor123
16.5Termination by Contractor123
ARTICLE 17INDEMNITIES124
17.1Contractor’s General Indemnification124
17.2Injuries to Contractor’s Employees and Damages to Contractor’s Property126
17.3Injuries to Owner’s Employees and Damages to Owner’s Property127
17.4Pre-Existing Hazardous Materials129
17.5Patent and Copyright Infringement129
17.6Lien Discharge129
17.7Legal Defense130
17.8Enforceability131
ARTICLE 18DISPUTE RESOLUTION131
18.1Negotiation131
18.2Arbitration132
18.3Continuation of Work during Dispute132
ARTICLE 19CONFIDENTIALITY133
19.1Contractor’s Obligations133
19.2Owner’s Obligations133
19.3Definitions134
19.4Exceptions134
19.5Equitable Relief135
19.6Term135
19.7Compliance135
ARTICLE 20LIMITATION OF LIABILITY135
20.1Contractor Aggregate Liability135
20.2Limitation on Contractor’s Liability for Liquidated Damages136
20.3Liquidated Damages in General137
20.4Consequential Damages137
20.5Exclusive Remedy138
20.6Application of Liability Limitations138
ARTICLE 21MISCELLANEOUS PROVISIONS138
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21.1Entire Agreement138
21.2Amendments138
21.3Joint Effort138
21.4Captions138
21.5Notice139
21.6Severability140
21.7Assignment140
21.8No Waiver141
21.9Governing Law141
21.10Foreign Corrupt Practices Act141
21.11Successors and Assigns141
21.12Attachments and Schedules141
21.13Obligations141
21.14Further Assurances141
21.15Priority142
21.16Restrictions on Public Announcement142
21.17Parent Guarantee142
21.18Language142
21.19Counterparts142
21.20Owner’s Lender143
21.21Potential Lenders, Potential Equity Investors and Equity Participants143
21.22Liquefaction Facility144
21.23Survival144

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LIST OF ATTACHMENTS AND SCHEDULES
ATTACHMENT AScope of Work and Basis of Design
SCHEDULE A-1Scope of Work
SCHEDULE A-2Basis of Design
ATTACHMENT BContractor Deliverables
ATTACHMENT CPayment Schedule
SCHEDULE C-1Aggregate Labor and Skills Price Payment Milestones
SCHEDULE C-2Aggregate Labor and Skills Price Monthly Payment Schedule
SCHEDULE C-3Aggregate Equipment Price Payment Milestones
SCHEDULE C-4Estimated Monthly Payments for the Project
ATTACHMENT DForm of Change Order
SCHEDULE D-1Change Order Form
SCHEDULE D-2Unilateral Change Order Form
SCHEDULE D-3Change Order Request Forms
SCHEDULE D-4Rate Sheet
ATTACHMENT EDelay Liquidated Damages
ATTACHMENT FKey Personnel and Contractor’s Organization
ATTACHMENT GApproved Major Subcontractors
ATTACHMENT HNotice to Proceed Forms
SCHEDULE H-1Form of Notice to Proceed
SCHEDULE H-2Form of Limited Notice to Proceed
SCHEDULE H-3Form of Limited Notice to Proceed No. 1
ATTACHMENT IForm of Contractor’s Invoices
SCHEDULE I-1Form of Contractor’s Interim Invoice
SCHEDULE I-2Form of Contractor’s Final Invoice
SCHEDULE I-3Form of contractor LNTP Invoice
ATTACHMENT JHSE Plan Requirements for Stage 3
ATTACHMENT KForm of Lien and Claim Waivers
SCHEDULE K-1Contractor’s Interim Conditional Lien Waiver and Release upon Progress Payment
SCHEDULE K-2Contractor’s Interim Unconditional Lien Waiver and Release upon Progress Payment
SCHEDULE K-3Major Subcontractor’s Interim Conditional Lien Waiver and Release upon Progress Payment
SCHEDULE K-4Major Subcontractor’s Interim Unconditional Lien Waiver and Release upon Progress Payment
SCHEDULE K-5Major Sub-subcontractor’s Interim Conditional Lien Waiver and Release upon Progress Payment
SCHEDULE K-6Major Sub-subcontractor’s Interim Unconditional Lien Waiver and Release upon Progress Payment
SCHEDULE K-7Contractor’s Final Conditional Lien Waiver and Release upon Final Payment
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SCHEDULE K-8Contractor’s Final Unconditional Lien Waiver and Release upon Final Payment
SCHEDULE K-9Contractor’s Final Claim Waiver and Release upon Final Payment
SCHEDULE K-10Major Subcontractor’s Final Conditional Lien Waiver and Release upon Final Payment
SCHEDULE K-11Major Subcontractor’s Final Unconditional Lien Waiver and Release upon Final Payment
SCHEDULE K-12Major Subcontractor’s Final Claim Waiver and Release upon Final Payment
SCHEDULE K-13Major Sub-subcontractor’s Final Conditional Lien Waiver and Release upon Final Payment
SCHEDULE K-14Major Sub-subcontractor’s Final Unconditional Lien Waiver and Release upon Final Payment
SCHEDULE K-15Major Sub-subcontractor’s Final Claim Waiver and Release upon Final Payment
ATTACHMENT LForm of Completion Certificates
SCHEDULE L-1Form of RFFGI Certificate
SCHEDULE L-2Form of RFSU Certificate
SCHEDULE L-3Form of Substantial Completion Certificate
SCHEDULE L-4Form of Final Completion Certificate
ATTACHMENT MPre-Commissioning, Commissioning, Start-up, Training and Turnover Program
ATTACHMENT NNot used
ATTACHMENT OInsurance Requirements
ATTACHMENT PContractor Permits
ATTACHMENT QOwner Permits
ATTACHMENT RForm of Irrevocable, Standby Letter of Credit
ATTACHMENT SPerformance Tests and Commissioning Tests
ATTACHMENT TMinimum Acceptance Criteria, Performance Guarantees and Performance Liquidated Damages
ATTACHMENT UForm of Parent Guarantee
SCHEDULE U-1Guarantor Form of Acknowledgment and Consent Agreement with Lender for Stage 3
ATTACHMENT VOwner-Furnished Items
ATTACHMENT WCapital Spare Parts List
ATTACHMENT XMeeting and Reporting Requirements
ATTACHMENT YQuality Plan
ATTACHMENT ZReal Estate Matters
ATTACHMENT AAForm of Acknowledgment and Consent Agreement for Stage 3
ATTACHMENT BBRely Upon Information
ATTACHMENT CCList of Equipment
ATTACHMENT DDOwner’s Texas Direct Pay Exemption Certificate
ATTACHMENT EEScheduled Activities
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ATTACHMENT FFNot used
ATTACHMENT GGProvisional Sums
ATTACHMENT HHForm of Novation Agreement
ATTACHMENT IIBASF Sublicense Agreement
ATTACHMENT JJChart Assignment Agreement
ATTACHMENT KKContractor’s COVID-19 Countermeasures, Means, and Methods and Provisional Sum
ATTACHMENT LLFTZ Agreement
ATTACHMENT MMCommodity Price Rise and Fall
ATTACHMENT NNScoping Adjustment
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ENGINEERING, PROCUREMENT AND CONSTRUCTION AGREEMENT
THIS ENGINEERING, PROCUREMENT AND CONSTRUCTION AGREEMENT (this “Agreement”), dated the 1st Day of March, 2022 (the “Agreement Date”), is entered into by and between Corpus Christi Liquefaction Stage III, LLC, a limited liability company organized under the laws of the State of Delaware having its principal place of business at 700 Milam, Suite 1900, Houston Texas 77002 (“Owner”), and Bechtel Energy Inc., a Delaware corporation having an address at 3000 Post Oak Boulevard, Houston, Texas 77056 (“Contractor”). Each of Owner and Contractor are a “Party” and together the “Parties.”
RECITALS
WHEREAS, Owner desires to enter into an agreement with Contractor to perform the engineering, procurement, construction, pre-commissioning, commissioning, start-up and testing of a fixed price turnkey mid-scale Natural Gas liquefaction facility consisting of seven (7) liquefaction units, each having an aggregate nominal LNG production capacity of approximately 1.5 million metric tonnes per annum (“mtpa”) and associated facilities (the “Stage 3 Facility,” as defined in greater detail herein) located in San Patricio County, Texas (the “Site”, as defined in greater detail herein), and interconnects with the CCL Liquefaction Facility (as each are further defined below); and
WHEREAS, Contractor, itself or through its vendors, suppliers, and subcontractors, desires to perform the foregoing engineering, procurement, construction, pre-commissioning, commissioning, start-up and testing of the Stage 3 Facility on a fixed price turnkey basis (which fixed price is separated for tax purposes); and
NOW THEREFORE, in consideration of the mutual covenants herein contained and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties hereby agree as follows:
ARTICLE 1
DEFINITIONS
In addition to other defined terms used throughout this Agreement, when used herein, the following capitalized terms have the meanings specified in this Article 1.
90 Day Look-ahead Schedule” has the meaning set forth in Section 5.4E.
AAA” has the meaning set forth in Section 18.2.
AAA Rules” has the meaning set forth in Section 18.2.
Abandonment” or “Abandon means, prior to the acceptance by Owner of the Substantial Completion Certificates for all seven (7) Trains, Contractor's cessation of all or substantially all of the Work (unless Contractor is entitled to stop, suspend or terminate the performance of the Work under the Agreement).
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Acceleration Schedule” has the meaning set forth in Section 5.6.
Affiliate” means with respect to any Person (for the purposes of this definition, a “subject Person”) (i) any Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with a subject Person, and (ii) any Person that, directly or indirectly, is the beneficial owner of fifty percent (50%) or more of any class of equity securities of, or other ownership interests in, a subject Person or of which the subject Person is directly or indirectly the owner of fifty percent (50%) or more of any class of equity securities or other ownership interests. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or otherwise.
Agreement” means this Agreement for the performance of the Work (including these Terms and Conditions and all Attachments and Schedules attached hereto), as it may be amended from time to time in accordance with these Terms and Conditions.
Agreement Date” has the meaning set forth in the preamble.
Aggregate Equipment Price” has the meaning set forth in Section 7.1A.
Aggregate Labor and Skills Price” has the meaning set forth in Section 7.1B.
Aggregate Provisional Sum” has the meaning set forth in Section 7.1C.
Aggregate Provisional Sum Equipment Price has the meaning set forth in Section 7.1C.
Aggregate Provisional Sum Labor and Skills Price” has the meaning set forth in Section 7.1C.
aMDEA” has the meaning set forth in Section 10.6A.
Applicable Codes and Standards” means any and all codes, standards or requirements set forth in Attachment A or in any Applicable Law, which codes, standards and requirements shall govern Contractor’s performance of the Work, as provided herein. In the event of an inconsistency or conflict between any of the Applicable Codes and Standards in place as of the Agreement Date, the more specific obligation as contemplated therein that complies with Applicable Law shall govern Contractor’s performance under this Agreement.
Applicable Law” means all laws, statutes, ordinances, certifications, orders, (including presidential orders), decrees, proclamations, injunctions, licenses, Permits, approvals, rules and regulations, including any conditions thereto, of any Governmental Instrumentality having jurisdiction over any Party, all or any portion of the Land or the Stage 3 Facility or performance of all or any portion of the Work or the operation of the Stage 3 Facility, or other legislative or administrative action of a Governmental Instrumentality having jurisdiction over all or any portion of the Site or the Project or performance of all or any portion of the Work or the operation of the Project, or a final decree, judgment or order of a court which relates to the performance of Work hereunder or the interpretation or application of this Agreement, including
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(i) any and all Permits, (ii) any Applicable Codes and Standards set forth in Applicable Law, (iii) Environmental Law and (iv) tariffs, quotas, and duties.
approval” and “consent” means, unless specified otherwise herein, written approval and written consent. Wherever in this Agreement a provision is made for the giving or issuing of any consent by a Party, unless otherwise specified, such consent shall be in writing and the words “consent”, “approve”, “accept” or “certify” (or words of similar effect) are to be construed accordingly.
Arsenic” means the metallic element with an Atomic Number of 33 (AS) in concentrations that exceed action levels which trigger a duty to investigate or respond as established under Environmental Law and which is located at the Land.
As-Built Drawings” has the meaning set forth in Attachment B.
Attachments” means, collectively, Attachment A through and including Attachment NN of this Agreement (including all Schedules attached thereto).
Baker” has the meaning set forth in Section 19.2.
Baker Competitors” has the meaning set forth in Section 19.2.
Basis of Design” means the basis of design of the Stage 3 Facility as set forth in Schedule A-2.
Bechtel Treasury Secured Hedge Rate” has the meaning set forth in Section 7.10
Books and Records” has the meaning set forth in Section 3.13A.
Bulk Material Supplier” means those Subcontractors or Sub-subcontractors not performing Work on-Site but engaged by Contractor to provide bulk commodities or materials (e.g. commodities or materials ordered by weight, volume, or footage) for incorporation into the Work.
Business Day” means every Day other than a Saturday, a Sunday or a Day that is an official holiday for employees of the federal government of the United States of America.
CAD” has the meaning set forth in Section 3.3E.
Capital Spare Parts” means those capital spare parts listed in Attachment W for use after Substantial Completion, as further set forth in Section 3.4B.
CCL Liquefaction Facility” means the LNG liquefaction facilities and all appurtenances thereto that have been constructed or are being constructed at the CCL Liquefaction Facility Site and which are owned and operated or will be operated by Corpus Christi Liquefaction, LLC.
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CCL Liquefaction Facility Site” means those areas where the CCL Liquefaction Facility is located as shown in greater detail in Attachment Z.
CCL Liquefaction Facility Tie-In Work” has the meaning set forth in Section 1.3 of Schedule A-1.
Change Order” means a written instrument signed by both Parties after the execution of this Agreement in the form of Schedule D-1, that authorizes an addition to, deletion from, suspension of, or any other modification or adjustment to the requirements of these Terms and Conditions, including an addition to, deletion from or suspension of the Work or any modification or adjustment to any Changed Criteria. Owner and Contractor are entitled to a Change Order in accordance with Article 6.
Changed Criteria” has the meaning set forth in Section 6.1C.
Change in COVID-19 Applicable Law” means the enactment, adoption, promulgation, imposition or repeal of an Applicable Law or an amendment to an Applicable Law or a change in the interpretation or application of an Applicable Law by a Governmental Instrumentality, that, in either case, is issued (a) in response to the COVID-19 pandemic, or to protect the general public or those performing the Work from the spread of COVID-19, or to otherwise fight against the spread of COVID-19, and (b) after the Agreement Date.
Changes in Law” means any amendment, modification, superseding act, deletion, addition, or change in or to Applicable Law (including changes to Tax laws that directly impact the Work but excluding changes to Tax laws where such Taxes are based upon Contractor’s revenue, income, profits/losses or cost of finance or withholding Tax, and excluding all changes in duties and tariffs, which are separately addressed in Sections 6.2A.10 and Section 6.2A.13) that occurs and takes effect after the Agreement Date. Changes in Law shall include any official change in the interpretation or application of Applicable Law (including Applicable Codes and Standards set forth in Applicable Law) that is not due to an act or omission of Contractor or its Subcontractors or Sub-subcontractors, provided that such change is expressed in writing by the applicable Governmental Instrumentality. Changes in Law do not include Change in COVID-19 Applicable Law.
Change Request” has the meaning set forth in Section 6.1A.
Changes in Non-U.S. Duties and Tariffs” means any amendment, modification, superseding act, deletion, addition, or change in or to any Non-U.S. Duties and Tariffs that occurs and takes effect after the Agreement Date. Changes in Non-U.S. Duties and Tariffs shall include any official change in the interpretation or application of Non-U.S. Duties and Tariffs that is not due to an act or omission of Contractor or its Subcontractors or Sub-subcontractors, provided that such change is expressed in writing by the applicable Governmental Instrumentality. For the avoidance of doubt, Changes in Non-U.S. Duties and Tariffs include an increase or decrease to the tariff or duty amount in effect as of the Agreement Date.

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Changes in U.S. Duties and Tariffs” has the meaning set forth in Attachment GG.
Chart” means Chart Energy and Chemicals, Inc., a corporation organized under the laws of the State of Delaware.
Chart License Agreement” means the license agreement between Contractor and Chart dated March 1, 2022.
Chart’s Confidential Information” has the meaning set forth in Section 19.2.
Competitors of Contractor” has the meaning set forth in Section 19.2.
Conclusive Defect” has the meaning set forth in Section 12.3A.
Confidential Information” has the meaning set forth in Section 19.3.
Consequential Damages” means (i) loss of use, loss of revenue, loss of profit or anticipated profit (if any), loss of business or contracts, service or business interruption, loss of market, loss of financing, increased or additional costs of obtaining or maintaining capital, loans or financing, loss of bonding capacity or capital, loss of opportunity or reputation or goodwill, loss of production, loss of productivity, and claims by Owner’s customers for economic loss or business interruption, and losses for principal office expenses including compensation of personnel stationed there, in each case whether direct, or consequential or indirect and whether or not foreseeable, and (ii) any special, incidental, punitive, exemplary, consequential, or indirect loss or damage.
Construction Equipment” means the equipment, machinery, temporary structures, scaffolding, materials, tools, supplies and systems, purchased, owned, rented or leased by Contractor or its Subcontractors or Sub-subcontractors for use in accomplishing the Work, but not intended for incorporation into the Stage 3 Facility.
Contract Exchange Rate” has the meaning set forth in Section 7.10.
Contract Price” has the meaning set forth in Section 7.1.
Contractor” has the meaning set forth in the preamble.
Contractor Group” means (i) Contractor and its Affiliates and parents and (ii) the respective directors, officers, agents, members, partners, shareholders, employees, representatives and invitees of each Person specified in clause (i) above.
Contractor Representative” means that Person or Persons designated by Contractor in Section 2.2B, or in a notice to Owner pursuant to the process in Section 2.2A, who shall have complete authority to act on behalf of Contractor on all matters pertaining to this Agreement or the Work, including giving instructions and making changes in the Work, except for any limitations specified in such notice.
Contractor’s Confidential Information” has the meaning set forth in Section 19.2.
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Contractor’s Intellectual Property” has the meaning set forth in Section 10.2.
Corpus Christi Facilities” has the meaning set forth in Section 17.1H.
Corrective Work” has the meaning set forth in Section 12.3B.1.
COVID-19” means an infectious respiratory disease caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), as identified by the World Health Organization and further abbreviated by such organization as “COVID-19,” including any related strains and mutations of COVID-19, wherever the same may occur.
COVID-19 Countermeasures” has the meaning set forth in Section 6.13A.1
COVID-19 Events” means the occurrence of any of the following:
A.a Change in COVID-19 Applicable Law affecting the Work;
B.a change in COVID-19 Guidelines affecting the Work;
C.a COVID-19 Outbreak affecting the Work;
D.a COVID-19 Extension affecting the Work (provided that the relief for a COVID-19 Extension shall be solely handled as Provisional Sum in accordance with Attachment KK, except that Contractor shall also be entitled to schedule relief as a COVID-19 Event for the Countermeasures in Rows 10 and 21 of Schedule KK-1 in accordance with Section 6.13B; or
E.occurrence of other epidemics, pandemics, or plagues affecting the Work.
COVID-19 Extension” has the meaning set forth in Section 6.13A.1.
COVID-19 Guidelines” means the published guidelines, recommendations or suggested practices (including all revisions, amendments or supplements thereto) of any Governmental Instrumentality or relevant health or safety agency or body, including the Centers for Disease Control and Prevention (CDC), World Health Organization (WHO) or the Occupational Safety & Health Administration (OSHA), that is applicable to the performance of the Work that (a) is issued for the purpose of protecting the general public or those performing the Work from the spread of COVID-19, or to otherwise fight against the spread of COVID-19 and (b) is implemented by Contractor or its applicable Subcontractors or Sub-subcontractors for the purpose of reasonably protecting those performing the Work from the spread of COVID-19, provided that with respect to any Work at the Land, Contractor will first consult with Owner before implementation .
COVID-19 Outbreak” means a threatened or actual increase in the incidence of COVID-19 infection among Owner Group’s or Contractor’s (or its Subcontractor’s or Sub-subcontractors) personnel assigned to perform the Work above the incident rate at the Site or in the region where the applicable Work is being performed that existed prior to such increase.
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COVID-19 Provisional Sum” means the costs and expenses for the COVID Countermeasures set forth in Attachment KK that are implemented by Contractor (or its applicable Subcontractors or Sub-subcontractors) as a result of COVID-19 (including the occurrence of a COVID-19 Event) in accordance with this Agreement. The initial provisional sum amount is set forth in Section 1.0(d) of Attachment KK.
Cumulative Changes in Non-U.S. Duties and Tariffs” has the meaning set forth in Section 7.13D.
Cure Period” has the meaning set forth in Section 16.1C.
Day” means a calendar day.
Default” has the meaning set forth in Section 16.1A.
Defect” or “Defective” has the meaning set forth in Section 12.1A.
Defect Correction Period” means:
(i)with respect to Structural Work, the period commencing upon Substantial Completion of the applicable Train and ending three (3) years thereafter;
(ii)with respect to Train 1 Work (excluding Structural Work), the period commencing upon Substantial Completion of Train 1 and ending eighteen (18) months thereafter, as extended in accordance with Section 12.3C;
(iii)with respect to Train 2 Work (excluding Structural Work), the period commencing upon Substantial Completion of Train 2 and ending eighteen (18) months thereafter, as extended in accordance with Section 12.3C;
(iv)with respect to Train 3 Work (excluding Structural Work), the period commencing upon Substantial Completion of Train 3 and ending eighteen (18) months thereafter, as extended in accordance with Section 12.3C;
(v)with respect to Train 4 Work (excluding Structural Work), the period commencing upon Substantial Completion of Train 4 and ending eighteen (18) months thereafter, as extended in accordance with Section 12.3C;
(vi)with respect to Train 5 Work (excluding Structural Work), the period commencing upon Substantial Completion of Train 5 and ending eighteen (18) months thereafter, as extended in accordance with Section 12.3C;
(vii)with respect to Train 6 Work (excluding Structural Work), the period commencing upon Substantial Completion of Train 6 and ending eighteen (18) months thereafter, as extended in accordance with Section 12.3C; and

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(viii)with respect to Train 7 Work (excluding Structural Work), the period commencing upon Substantial Completion of Train 7 and ending eighteen (18) months thereafter, as extended in accordance with Section 12.3C.
Delay Liquidated Damages” means one or all of the Train 1 Delay Liquidated Damages, the Train 2 Delay Liquidated Damages, the Train 3 Delay Liquidated Damages, the Train 4 Delay Liquidated Damages, the Train 5 Delay Liquidated Damages, the Train 6 Delay Liquidated Damages and the Train 7 Delay Liquidated Damages, as the context requires.
Direct Competitor of Chart” means the following direct competitors of Chart in the Chart liquefaction process technology or the design or manufacture of brazed aluminum heat exchangers and cold boxes: ***, ***, ***, ***, ***, ***, ***, ***, ***, ***, ***, ***, ***, ***, ***, and ***, (as such list may be updated from time to time as mutually agreed in writing by the Parties).
Disclosing Party” has the meaning set forth in Section 19.3.
Dispute” has the meaning set forth in Section 18.1.
Dispute Notice” has the meaning set forth in Section 18.1.
Drawings” means the graphic and pictorial documents (in written or electronic format) showing the design, location and dimensions of the Work, generally including plans, elevations, sections, details, schedules and diagrams, which are prepared as a part of and during the performance of the Work.
Early Works Change Order” means the Change Order executed on January 13, 2022, under the FEED Verification Agreement.
Environmental Law” means any Applicable Law relating to (i) pollution; (ii) protection of human health and safety (to the extent such health and safety relates to exposure to Hazardous Materials, including any Pre-Existing Contamination and Arsenic), natural resources or the environment; and/or (iii) any exposure to, or presence, generation, manufacture, use, handling, storage, treatment, processing, transport or disposal, arrangement for transport or disposal, or spill, discharge or other release of Hazardous Materials, including any Pre-Existing Contamination and Arsenic.
Equipment” means all materials and equipment to be permanently incorporated into the Stage 3 Facility.
Excepted Risks has the meaning set forth in Section 8.2A.
Excessive Monthly Precipitation” means that the total precipitation measured on the Land for the Month that the event in question occurred has exceeded the following selected probability levels for such Month for Weather Station TX412015 Corpus Christi International AP, as specified in the National Oceanic and Atmospheric Administration publication titled
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“Climatography of the U.S. No. 81, Supplement No. 1, Monthly Precipitation Probabilities and Quintiles, 1971-2000”:
(1)For the period from Contractor’s mobilization to the Site until twenty one (21) Months after NTP with respect to Train 1 and Work related to overall Site civil, piling and OSBL underground piping; for the period from Contractor’s mobilization of the Site until twenty one (21) Months after NTP with respect to Train 2; for the period from Contractor’s mobilization of the Site until twenty four (24) months after NTP with respect to Train 3; for the period from Contractor’s mobilization of the Site until twenty seven (27) months after NTP with respect to Train 4; for the period from Contractor’s mobilization of the Site until thirty (30) months after NTP with respect to Train 5; for the period from Contractor’s mobilization of the Site until thirty three (33) months after NTP with respect to Train 6; and for the period from Contractor’s mobilization of the Site until thirty five (35) months after NTP with respect to Train 7, the selected probability level of 0.6 shall apply; and
(2)For all other periods after Contractor’s mobilization to the Site, the selected probability level of 0.8 shall apply.
The Parties recognize that the assessment as to whether or not total precipitation measured at the Land for a given Month constitutes Excessive Monthly Precipitation can only be made after the end of the Month in question.
Excluded Documents” has the meaning set forth in Section 10.2.
FCPA” has the meaning set forth in Section 21.10.
FEED Package” means the documents listed in Table A-2-1, Table A-2-2, Table A-2-3 and Table A-2-4 of Schedule A-2.
FEED Verification Agreement” means the Front End Engineering Design (FEED) Verification Agreement between Owner and Contractor, dated February 25, 2019.
FERC” means the Federal Energy Regulatory Commission.
FERC Authorization” means a written authorization issued from time to time by the FERC director of the Office of Energy Projects, authorizing Owner to commence construction of the Stage 3 Facility, or take such other actions with respect to the Stage 3 Facility as set forth therein.
Final Completion” means that all Work for the Stage 3 Facility and all other obligations under this Agreement (except for that Work and obligations that survive the termination or expiration of this Agreement, including obligations for Warranties, correction of Defective Work and those covered by Section 11.9), are fully and completely performed in accordance with the terms of this Agreement, including: (i) the achievement of Substantial Completion of all Trains; (ii) the achievement of all Performance Guarantees or payment of all Performance Liquidated Damages due and owing for all Trains; (iii) the completion of all Punchlist items for all Trains; (iv) delivery by Contractor to Owner of a fully executed Final Conditional Lien Waiver and Final
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Claim Waiver in the form of Schedules K-7 and K-9; (v) delivery by Contractor to Owner of all documentation required to be delivered under this Agreement, including Record As-Built Drawings and Specifications, test reports and the final operation and maintenance manuals for the Stage 3 Facility; (vi) delivery to Owner, in content and form reasonably satisfactory to Owner, of copies of all requested Subcontracts (redacted in accordance with Section 2.4D); (vii) removal from the Land of all of Contractor’s, Subcontractors’ and Sub-subcontractors’ personnel, supplies, waste, materials, rubbish, Hazardous Materials, Construction Equipment, and temporary facilities for which Contractor is responsible under Article 3, other than as required by Contractor to fulfill its obligations under Section 12.3B; (viii) delivery by Contractor to Owner of fully executed Final Conditional Lien Waivers and Final Claim Waivers from all Major Subcontractors in the form of Schedules K-10 and K-12; (ix) if requested by Owner, fully executed Final Conditional Lien Waivers and Final Claim Waivers from each Major Sub-subcontractor in a form substantially similar to the form of Schedules K-13 and K-15; and (x) delivery by Contractor to Owner of a Final Completion Certificate in the form of Schedule L-4 and as required under Section 11.6, which Owner has accepted by signing such certificate.
Final Completion Certificate” has the meaning set forth in Section 11.6.
Final Completion Date” has the meaning set forth in Section 5.3B.
Final Lien and Claim Waiver” means the waiver and release provided to Owner by Contractor, Major Subcontractors and Major Sub-subcontractors in accordance with the requirements of Section 7.3, which shall be in the form of Schedules K-7 through K-15.
Force Majeure” means catastrophic storms or floods, hurricanes, typhoons, cyclones, Qualifying Named Storms or floods, Excessive Monthly Precipitation, tsunamis, lightning, tornadoes, earthquakes and other acts of God, radioactive contamination, accidents at sea, wars, civil disturbances, Regional Strikes or other similar national or industry wide labor actions, terrorist attacks, revolts, insurrections, sabotage, commercial embargoes, fires, explosions, and actions of a Governmental Instrumentality (such as compulsory acquisition or expropriation) that were not requested, promoted, or caused by the affected Party; provided that such act or event (a) delays or renders impossible the affected Party’s performance of its obligations under this Agreement, (b) is beyond the reasonable control of the affected Party and not due to its fault or negligence, and (c) could not have been safely prevented or avoided by the affected Party through the exercise of reasonable due diligence. For avoidance of doubt, Force Majeure shall not include any of the following: (i) economic hardship, (ii) changes in market conditions, (iii) late delivery or failure of Construction Equipment or Equipment unless such late delivery or failure of Construction Equipment or Equipment was otherwise caused by Force Majeure, (iv) labor availability, strikes, or other similar labor actions, other than Regional Strikes or other similar national or industry wide labor actions, (v) any impact to the Work as a result of COVID-19, including any COVID-19 Events, or (vi) climatic conditions (including rain, snow, wind, temperature and other weather conditions), tides, and seasons, regardless of the magnitude, severity, duration or frequency of such climatic conditions, tides or seasons, but excluding catastrophic storms, lightning, tornadoes, hurricanes, typhoons, cyclones, Qualifying Named Storms or floods, Excessive Monthly Precipitation, tsunamis and earthquakes.
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Fuel Adjustment Basis” has the meaning set forth in Section 7.11.
Geotechnical Reports” means:
1.“Preliminary Geotechnical Report Corpus Christi Liquefaction - Stage 3 Project San Patricio County, TX - Revision 2” October 2015 (Transmittal No. CCL3-BEC-T- 00123)
2.“Geotechnical Report Corpus Christi Liquefaction - Stage 3 Project San Patricio County, TX” March 2016 (Transmittal No. CCL3-BEC-T- 00123)
3.“Load Test Report - Engineering & Design #1289-Cheniere LNG Demonstration Load Test” (Transmittal No. CCL3-BEC-T-00059)
4.“Controlled Modulus Column (CMC) Procedural Submittal, Engineering & Design #12XX- Cheniere Load Test” (Transmittal No. CCL3-BEC-T- 00118)
5.“Geotechnical Report Task#5: Transmission Line Project CCL Stage 3 Corpus Christi, Texas” November 2019 (Transmittal No. CCL3-BEC-T-00127)
6.“Technical Memorandum Slope Stability Analysis Methodology Rev1” November 18th 2019 (Transmittal No. CCL3-BEC-T-00133)
7.“Draft Geotechnical Report, Corpus Christi Liquefaction Stage3 San Patricio County, TX” December 2019 (Transmittal No. CCL3-BEC-T-00132)
8.“Capping of Beds 18 through 21 With Materials from CCL Stage 3” August 1st 2019 (Transmittal No. CCL3-BEC-T-00122)
9.“Revised Axial Pile Capacity CCL Stage 3- FEED Corpus Christi, Texas” October 16th 2019 (Transmittal No. CCL3-BEC-T-00120)
10.“Technical Memorandum 19.14.061 DMM Bench Scale Study, Corpus Christi LNG Stage 3 - FEED Corpus Christ, Texas” (Transmittal No. CCL3-BEC-T-00119)
11.“Technical Memorandum CCL Stage 3: FEED Study- Piperack and OSBL Containment Basin” San Patricio County Texas, September 2019 (Transmittal No. CCL3-BEC-T-00121)
12.“Technical Memorandum CCL Stage 3: Transmission Line (Task 5)” Corpus Christi, Texas, October 24th 2019 (Transmittal No. CCL3-BEC-T-00098)
13.Final Report Revision1 “Supplemental Seismic, Tsunami, and Geologic Hazards Report for the CCL Stage 3 Project Corpus Christi, Texas” 15 Jan 2020 (Transmittal No. CCL3-BEC-T-00179)
14.“40 Test Pit Report, CCL Stage 3, Corpus Christi, Texas, December 2019” (Transmittal No. CCL3-BEC-T-00149)
15.“Final Geotechnical Report, Corpus Christi Liquefaction Stage 3 San Patricio County, TX Rev 1” January 2020 (Transmittal No.: CCL3-BEC-T-00183)
16.“Final Geotechnical Report, Corpus Christi Liquefaction Stage 3 San Patricio County, TX Rev 2” March 2020 (Transmittal No.: CCL3-BEC-T-00252)

Good Engineering and Construction Practices” or “GECP” means the generally recognized and accepted reasonable and prudent practices, methods, skill, care, techniques and standards employed by the international LNG liquefaction and storage engineering and construction industries with respect to the engineering, procurement, construction, pre-commissioning,
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commissioning, start-up and testing of Natural Gas liquefaction and storage facilities of similar size and type as the Stage 3 Facility and in accordance with Applicable Codes and Standards and Applicable Law.
Governmental Instrumentality” means any federal, state or local department, office, instrumentality, agency, authority, board or commission having jurisdiction over a Party or any portion of the Work, the Stage 3 Facility, or the Land.
Guarantee Conditions” mean the conditions upon which the Minimum Acceptance Criteria and Performance Guarantees are based and shall be tested, as further defined in Attachment S and Attachment T.
Guaranteed Dates” mean the Guaranteed Substantial Completion Dates. The Guaranteed Dates shall only be adjusted by Change Order as provided under this Agreement.
Guaranteed Substantial Completion Date” or “Guaranteed Substantial Completion Dates” has the meaning set forth in Section 5.3A.
Guaranteed Train 1 Substantial Completion Date” has the meaning set forth in Section 5.3A.1 as may be adjusted by Change Order in accordance with the terms of this Agreement.
Guaranteed Train 2 Substantial Completion Date” has the meaning set forth in Section 5.3A.2 as may be adjusted by Change Order in accordance with the terms of this Agreement.
Guaranteed Train 3 Substantial Completion Date” has the meaning set forth in Section 5.3A.3 as may be adjusted by Change Order in accordance with the terms of this Agreement.
Guaranteed Train 4 Substantial Completion Date” has the meaning set forth in Section 5.3A.4 as may be adjusted by Change Order in accordance with the terms of this Agreement.
Guaranteed Train 5 Substantial Completion Date” has the meaning set forth in Section 5.3A.5 as may be adjusted by Change Order in accordance with the terms of this Agreement.

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Guaranteed Train 6 Substantial Completion Date” has the meaning set forth in Section 5.3A.6 as may be adjusted by Change Order in accordance with the terms of this Agreement.
Guaranteed Train 7 Substantial Completion Date” has the meaning set forth in Section 5.3A.7 as may be adjusted by Change Order in accordance with the terms of this Agreement.
Guarantor” means Bechtel Global Energy, Inc., a Delaware corporation.
Hazardous Materials” means any substance that under Environmental Law is regulated as hazardous or toxic or that requires or may require remedial or corrective action if released into the environment, including (i) any petroleum or petroleum products, radioactive materials, asbestos in any form, Arsenic, transformers or other equipment that contain dielectric fluid containing polychlorinated biphenyls and processes and certain cooling systems that use chlorofluorocarbons, (ii) any chemicals, materials, substances or wastes which are now or hereafter become defined as or included in the definition of “hazardous substances,” “hazardous wastes,” “hazardous materials,” “extremely hazardous wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic pollutants,” or any words of similar import pursuant to Environmental Law, or (iii) any other chemical, material, substance or waste, exposure to which is now or hereafter prohibited, limited or regulated by any Governmental Instrumentality, or which may be the subject of liability under Environmental Law for damages, costs, remediation or corrective action.
HAZOP” means a hazard and operability study used as a structured and systematic technique for system examination and risk management.
Imminent Threat” has the meaning set forth in Section 12.3A.
Indemnified Party” means any member of Owner Group or Contractor Group, as the context requires.
Indemnifying Party” means Owner or Contractor, as the context requires.
Independent Engineer” means the engineer(s) employed by Owner or Lender.
Initial Schedule” has the meaning set forth in Section 5.4A.
Insolvency Event” has the meaning set forth in Section 16.1A.
Interim Lien Waiver” means the waiver and release provided to Owner by Contractor, Major Subcontractors and Major Sub-subcontractors in accordance with the requirements of Section 7.2D, which shall be in the form of Schedules K-1 through K-6.
Investment Grade” means a rating of at least A- by Standard & Poor’s and at least A3 by Moody’s Investors Service.

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Invoice” means Contractor’s request for an interim payment pursuant to Section 7.2 and for final payment pursuant to Section 7.3, which invoice shall be in the form of Schedule I-1 for interim payments and Schedule I-2 for final payment.
Key Personnel” or “Key Persons” has the meaning set forth in Section 2.2A.
Land” means, as applicable, the Site, the Supporting Real Estate and the CCL Liquefaction Facility Site or any portion thereof.
Landowner” means any entity having an interest in the Land.
Lender” means any entity or entities providing temporary or permanent debt financing to Owner for the Stage 3 Facility.
Letter of Credit” has the meaning set forth in Section 9.2.
Limited Notice to Proceed” or “LNTP” means any limited notice to proceed issued in accordance with Section 5.1, authorizing and requiring Contractor to proceed with the Work identified in such LNTP.
Liquidated Damages” means Delay Liquidated Damages and Performance Liquidated Damages, as the context requires.
LNG” means liquefied Natural Gas.
LNTP No. 1” has the meaning specified in Section 5.1A.2.
LNTP Work” means the Work, if any, which shall be performed upon issuance of any LNTP (including LNTP No. 1).
Major Subcontract” means (i) any Subcontract having an aggregate value in excess of *** U.S. Dollars (U.S. $***), (ii) multiple Subcontracts with one Subcontractor that have an aggregate value in excess of *** U.S. Dollars (U.S. $***), or (iii) any Subcontract entered into with a Subcontractor for Work listed in Attachment G.
Major Subcontractor” means any Subcontractor with whom Contractor enters, or intends to enter, into a Major Subcontract.
Major Sub-subcontract” means (i) any Sub-subcontract having an aggregate value in excess of *** U.S. Dollars (U.S. $***), (ii) multiple Sub-subcontracts with one Sub-subcontractor that have an aggregate value in excess of *** U.S. Dollars (U.S. $***), or (iii) any Sub-subcontract entered into with a Sub-subcontractor for Work listed in Attachment G.
Major Sub-subcontractor” means any Sub-subcontractor with whom a Subcontractor or Sub-subcontractor enters, or intends to enter, into a Major Sub-subcontract.
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Minimum Acceptance Criteria” or “MAC” means the minimum acceptance criteria specified in Attachment T.
Mobilization Payment” has the meaning set forth in Section 7.2A.
Month” means a Gregorian calendar month; “month” means any period of thirty (30) consecutive Days.
Monthly” means an event occurring, or an action taken, once every Month.
Monthly Payments” has the meaning set forth in Section 7.2B.
Month N” has the meaning set forth in Section 7.2C.
Month N-1” means the Month prior to Month N.
Month N-2” means the Month prior to Month N-1.
Month N-3” means the Month prior to Month N-2.
Month N+1” has the meaning set forth in Section 7.2C.1.
Monthly Progress Reports” has the meaning set forth in Section 3.19A.4.
Monthly Updated Project Schedule” has the meaning set forth in Section 5.4D.
mtpa” has the meaning set forth in the recitals.
Natural Gas” means combustible gas consisting primarily of methane.
Non-U.S. Duties and Tariffs” means all duties and tariffs assessed by one country for the importation of Equipment into such country, other than Changes in U.S. Duties and Tariffs, and exclusive of value added taxes, sales taxes, or other taxes and fees that do not relate directly to the importation of the Equipment.
Non-U.S. Duties and Tariffs Provisional Sum” has the meaning set forth in Section 7.13B.
Notice to Proceed” or “NTP” means the full notice to proceed issued in accordance with Schedule H-1 and Section 5.2, authorizing and requiring Contractor to commence the performance of the entire Work.
Novation Agreement” has the meaning set forth in Section 18.2.
OECD” has the meaning set forth in Section 21.10.
Operations Activity” or “Operations Activities” has the meaning set forth in Section 11.8.
OSBL” means outside the battery limits.
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OSHA” means the United States Department of Labor’s Occupational Safety and Health Administration.
Owner” has the meaning set forth in the preamble hereto.
Owner-Furnished Items” has the meaning set forth in Section 4.6B.
Owner Group” means (i) Owner, its parent and their respective Affiliates, Lender, and (ii) the respective directors, officers, agents, members, partners, shareholders, employees, representatives and invitees of each Person specified in clause (i) above.
Owner Permits” means the Permits set forth in Attachment Q and any other Permits (not listed in either Attachment P or Attachment Q) necessary for performance of the Work or the operation of the Liquefaction Facility and which are required by Applicable Law to be in Owner’s name.
Owner Representative” means that Person or Persons designated by Owner in a notice to Contractor who shall have complete authority to act on behalf of Owner on all matters pertaining to the Work, including giving instructions and making changes in the Work, except for any limitations specified in such notice.
Owner’s Confidential Information” has the meaning set forth in Section 19.1.
Owner Proprietary Work Product” has the meaning set forth in Section 10.4.
P&ID” means piping and instrumentation diagrams.
Parent Guarantee” has the meaning set forth in Section 21.17.
Party” or “Parties” means Owner and/or Contractor and their successors and permitted assigns.
Payment Milestone” means a designated portion of the Work as shown in the Payment Schedule.
Payment Schedule” means the schedule set forth in Schedule C-1, which sets out the payments to be paid based on achievement of Payment Milestones.
pdf” has the meaning set forth in Section 5.4B.
Performance Guarantee(s)” means the performance guarantees specified in Attachment T.
Performance Liquidated Damages” means the liquidated damages associated with the failure to achieve one or more of the Performance Guarantees as specified in Attachment T, namely one or all of the Train 1 Performance Liquidated Damages, the Train 2 Performance Liquidated Damages, the Train 3 Performance Liquidated Damages, the Train 4 Performance Liquidated Damages, the Train 5 Performance Liquidated Damages, the Train 6 Performance Liquidated Damages and the Train 7 Performance Liquidated Damages, as the context requires.
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Performance Test” means the tests performed by Contractor to determine whether each Train meets the Performance Guarantees and the applicable Minimum Acceptance Criteria, which tests shall be set forth in Attachment S.
Permit” means any valid waiver, certificate, approval, consent, license, exemption, variance, franchise, permit, authorization or similar order or authorization from any Governmental Instrumentality required to be obtained or maintained in connection with the Stage 3 Facility, the Land or the Work.
Person” means any individual, company, joint venture, corporation, partnership, association, joint stock company, limited liability company, trust, estate, unincorporated organization, Governmental Instrumentality or other entity having legal capacity.
Potential Lenderhas the meaning set forth in Section 21.21A.
Pre-Existing Contamination” means Hazardous Materials (other than Arsenic) that (i) are present in concentrations that exceed action levels which trigger a duty to investigate or respond as established under Environmental Law, (ii) are located on the Land, and (iii) either (a) pre-date Contractor’s and its Subcontractors’ and Sub-subcontractors’ commencement of any Work on the Land under this Agreement or (b) were brought to the Site by any Person other than Contractor, its Subcontractors or its Sub-subcontractors.
Project” means the engineering, design, procurement, manufacturing, fabrication, assembly, transportation and delivery of Equipment, construction, pre-commissioning, commissioning, start-up and testing of the Stage 3 Facility and any portion thereof, and all other Work required to be performed under this Agreement.
Project Schedule” has the meaning set forth in Section 5.4B.
Project-Related Prolongation Costs” means the following time-related costs incurred by Contractor resulting solely from a prolongation to the overall duration required to complete the Work for the entire Project: maintenance and rental of temporary trailers, roads, parking, laydown and temporary fences and facilities on the Land; warehousing (including personnel); maintenance of heavy haul facilities on the Land; maintenance of permanent roads on the Land; dust control services on the Land; janitor service for temporary buildings on the Land; site security on the Land; jobsite trailer furniture, office supplies and computer equipment on the Land; and communications (telephone, cell phone service) for Contractor personnel performing services on the Land.
Prolongation Costs” means both the Project-Related Prolongation Costs and the Train-Related Prolongation Costs.
Provisional Sums” means the provisional sums described in Attachment GG with each provisional being a “Provisional Sum.”
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Punchlist” means those finishing items required to complete the Work, the existence of or completion of which shall not interrupt, disrupt or interfere with the safe and reliable operation or use of all or any part of the Stage 3 Facility as contemplated by this Agreement, as more fully described in Section 11.5 and Attachment M.
Qualifying Named Storm” means a hurricane or tropical storm that has been named by the U.S. National Weather Service, National Hurricane Center, or a similar applicable national agency applicable to the Land.
Quality Plan” has the meaning set forth in Section 3.18.
Quarter” means any or all of the following periods in each calendar year throughout the Project: January 1st through March 31st; April 1st through June 30th; July 1st through September 30th; and October 1st through December 31st.
Quarterly” means an event occurring, or an action taken, once every Quarter.
Quarterly Progress Report” has the meaning set forth in Section 3.19B.2.
Ready for Feed Gas Introduction” or “RFFGI” means, with respect to each Train, that all of the following have occurred: (i) Contractor has commissioned the systems and subsystems for RFFGI of Equipment for such Train and completed the activities necessary to support the introduction of hydrocarbons, including the utility and process systems, safeguarding and shutdown systems have been pre-commissioned, commissioned and integrity verified, all as set forth in greater detail in Attachment A and Attachment M; (ii) such Train is ready for acceptance of Natural Gas feed; (iii) Contractor has provided the required documents for FERC approval; and (iv) Contractor has delivered to Owner a RFFGI Certificate in the form of Schedule L-1 and Owner has accepted such certificate by signing such certificate.
RFFGI Certificate” has the meaning set forth in Section 11.1A.
Ready for Start-Up” or “RFSU” means, with respect to each Train, that all of the following have occurred: (i) Contractor has achieved and maintained Ready for Feed Gas Introduction for such Train; (ii) systems are commissioned and ready to start producing LNG all as set forth in greater detail in Attachment A and Attachment M; (iii) Contractor has provided required documents for FERC approval; and (iv) Contractor has delivered to Owner an RFSU Certificate for such Train in the form of Schedule L-2 and Owner has accepted such certificate by signing such certificate.
RFSU Certificate” has the meaning set forth in Section 11.1B.
Receiving Party” has the meaning set forth in Section 19.3.
Record As-Built Drawings and Specifications” means final, record Drawings and Specifications of each Train and the Stage 3 Facility showing the “as-built” conditions of each Train and the completed Stage 3 Facility, as required under Attachment B.
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Recovery Schedule” has the meaning set forth in Section 5.5.
Regional Strikes” means strikes or similar labor actions by craft construction labor occurring in the entire Gulf coast region in Texas and Louisiana, including the Site.
Rely Upon Information” means that certain information provided by Owner, which is expressly identified in Attachment BB as being Rely Upon Information.
Schedules” means the sub-divided portions of certain Attachments to this Agreement that are identified as Schedules in the list of Attachments and Schedules above.
Schedule Bonus” means the Schedule Bonus for Train 1, the Schedule Bonus for Train 2, the Schedule Bonus for Train 3, the Schedule Bonus for Train 4, the Schedule Bonus for Train 5, the Schedule Bonus for Train 6 and the Schedule Bonus for Train 7.
Schedule Bonus Date” means, as the context provides, either the Schedule Bonus Date for Train 1, the Schedule Bonus Date for Train 2, the Schedule Bonus Date for Train 3, the Schedule Bonus Date for Train 4, the Schedule Bonus Date for Train 5, the Schedule Bonus Date for Train 6, the Schedule Bonus Date for Train 7, or any combination of the foregoing.
Schedule Bonus Date for Train 1” has the meaning specified in Section 13.3A.
Schedule Bonus Date for Train 2” has the meaning specified in Section 13.3B.
Schedule Bonus Date for Train 3” has the meaning specified in Section 13.3C.
Schedule Bonus Date for Train 4” has the meaning specified in Section 13.3D.
Schedule Bonus Date for Train 5” has the meaning specified in Section 13.3E.
Schedule Bonus Date for Train 6” has the meaning specified in Section 13.3F.
Schedule Bonus Date for Train 7” has the meaning specified in Section 13.3G.
Schedule Bonus for Train 1” has the meaning specified in Section 13.3A.
Schedule Bonus for Train 2” has the meaning specified in Section 13.3B.
Schedule Bonus for Train 3” has the meaning specified in Section 13.3C.
Schedule Bonus for Train 4” has the meaning specified in Section 13.3D.
Schedule Bonus for Train 5” has the meaning specified in Section 13.3E.
Schedule Bonus for Train 6” has the meaning specified in Section 13.3F.
Schedule Bonus for Train 7” has the meaning specified in Section 13.3G.
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Scope of Work” means the description of Work to be performed by Contractor as set forth in this Agreement, including Attachment A.
Site” means those parcels of land where the Stage 3 Facility shall be located, as shown in greater detail in Attachment Z. For the avoidance of doubt, the Site does not include the Supporting Real Estate or the CCL Liquefaction Facility Site.
Soils Data” means the soils information contained in the Geotechnical Reports.
Soil Investigation Period” has the meaning set forth in Section 2.5B.2(i).
Specifications” means those documents consisting of the written requirements for Equipment, standards and workmanship for the Work and performance of related services, which are prepared as a part of and during the performance of the Work.
Stage 1 EPC Agreement” has the meaning set forth in Section 17.1H.
Stage 2 EPC Agreement” has the meaning set forth in Section 17.1H.
Stage 3 Facility” has the meaning set forth in the recitals. The Stage 3 Facility is comprised of Train 1, Train 2, Train 3, Train 4, Train 5, Train 6 and Train 7.
Structural Work” means any and all engineering, procurement or construction of the Stage 3 Facility or components thereof relating to the structural capacity, integrity or suitability of any load bearing elements (including foundation and piling) for any portion of the Stage 3 Facility, but excluding any Subcontractor or Sub-subcontractor supplied steel or load bearing components that, in each case, are provided in a packaged equipment configuration.
Subcontract” means an agreement by Contractor with a Subcontractor for the performance of any portion of the Work.
Subcontractor” means any Person (other than an Affiliate of Contractor), including an Equipment supplier or vendor, who has a direct contract with Contractor to manufacture or supply Equipment which is a portion of the Work, to lease Construction Equipment to Contractor in connection with the Work, to perform a portion of the Work or to otherwise furnish labor or materials.
Subproject 1” has the meaning set forth in the Stage 1 EPC Agreement.
Subproject 2” has the meaning set forth in the Stage 1 EPC Agreement.
Subproject 3” has the meaning set forth in the Stage 2 EPC Agreement.
Substantial Completion” means either Substantial Completion of Train 1, Substantial Completion of Train 2, Substantial Completion of Train 3, Substantial Completion of Train 4, Substantial Completion of Train 5, Substantial Completion of Train 6 or Substantial Completion of Train 7, as the context requires, and further means that all of the following have occurred with respect to a Train: (i) RFFGI has been achieved for such Train; (ii) RFSU has been achieved for
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such Train; (iii) the Minimum Acceptance Criteria have been achieved for such Train; (iv) in the case that all Performance Guarantees have not been achieved, Contractor has provided a corrective work plan in accordance with Section 11.4A, and Contractor has turned over such Train pursuant to Section 11.4A; (v) Contractor and Owner have agreed upon a list of Punchlist items for such Train as set forth in Section 11.5B; (vi) Contractor has paid to Owner all Delay Liquidated Damages due and owing for such Train in accordance with Section 13.2; (vii) Contractor has performed all Work related to such Train (including training, and the delivery of all documentation required for operation) in accordance with the requirements and specifications of this Agreement, other than Work which meets the definition of Punchlist; (viii) Contractor has delivered to Owner the applicable Substantial Completion Certificate in the form of Schedule L-3 and as required under Section 11.2 and Owner has accepted such certificate by signing such certificate; and (xi) Contractor has obtained and has continued to maintain all Permits required to be obtained by Contractor in Section 3.12B for the Stage 3 Facility.
Substantial Completion Certificate” has the meaning set forth in Section 11.2.
Sub-subcontract” means any agreement by a Subcontractor with a Sub-subcontractor or by a Sub-subcontractor with another Sub-subcontractor for the performance of any portion of the Work.
Sub-subcontractor” means any Person (including an Equipment supplier or vendor, but excluding Contractor and its Affiliates) of any tier, who has a contract with a Subcontractor or another Sub-subcontractor to manufacture or supply Equipment which comprises a portion of the Work, to lease Construction Equipment to Subcontractor or another Sub-subcontractor in connection with the Work, to perform a portion of the Work or to otherwise furnish labor, materials or equipment (including Equipment).
subsystem” has the meaning set forth in Attachment M.
Supporting Real Estate” means those off-Site rights of way, easements and other real estate rights listed in Attachment Z.
system” has the meaning set forth in Attachment M.
SWMU” has the meaning set forth in Section 3.17B.
Taxes” means any and all taxes, assessments, levies, duties, tariffs, fees, charges and withholdings of any kind or nature whatsoever and howsoever described, including sales and use taxes (excluding any Texas Sales and Use Tax on Equipment), value-added, gross receipts, license, payroll, federal, state, local or foreign income, environmental, profits, premium, franchise, property, excise, capital stock, import, stamp, transfer, employment, occupation, generation, privilege, utility, regulatory, energy, consumption, lease, filing, recording and activity taxes, levies, duties, fees, charges, imposts and withholding, together with any and all penalties, interest and additions thereto.
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Terms and Conditions” means, collectively, the recitals and Article 1 through and including Article 21.
Texas Sales and Use Tax” means Texas state, county, and local-option sales and use tax.
Third Party Intellectual Property” has the meaning set forth in Section 10.2.
Train” means Train 1, Train 2, Train 3, Train 4, Train 5, Train 6 or Train 7 as the context requires, and “Trains” means, collectively, Train 1, Train 2, Train 3, Train 4, Train 5, Train 6 and Train 7.
Train 1” means (regardless of any assigned numeral for a Train in Schedule A-2) the first phase of the Work (which includes the required OSBL) that is designed, procured, constructed, pre-commissioned, commissioned, started up, and tested for the Stage 3 Facility, as further defined in this Agreement, including Attachment A.
Train 1 Delay Liquidated Damages” has the meaning set forth in Section 13.1A.
Train 1 Performance Liquidated Damages” means the Performance Liquidated Damages for Train 1, as further described in Attachment T.
Train 1 Work” means the Work required to be performed pursuant to this Agreement for Train 1.
Train 2” means (regardless of any assigned numeral for a Train in Schedule A-2) the second phase of the Work (which includes the required OSBL) that is designed, procured, constructed, pre-commissioned, commissioned, started up, and tested for the Stage 3 Facility, as further defined in this Agreement, including Attachment A.
Train 2 Delay Liquidated Damages” has the meaning set forth in Section 13.1B.
Train 2 Performance Liquidated Damages” means the Performance Liquidated Damages for Train 2, as further described in Attachment T.
Train 2 Work” means the Work required to be performed pursuant to this Agreement for Train 2.
Train 3” means (regardless of any assigned numeral for a Train in Schedule A-2) the third phase of the Work (which includes the required OSBL) that is designed, procured, constructed, pre-commissioned, commissioned, started up, and tested for the Stage 3 Facility, as further defined in this Agreement, including Attachment A.
Train 3 Delay Liquidated Damages” has the meaning set forth in Section 13.1C.
Train 3 Performance Liquidated Damages” means the Performance Liquidated Damages for Train 3, as further described in Attachment T.
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Train 3 Work” means the Work required to be performed pursuant to this Agreement for Train 3.
Train 4” means (regardless of any assigned numeral for a Train in Schedule A-2) the fourth phase of the Work (which includes the required OSBL) that is designed, procured, constructed, pre-commissioned, commissioned, started up, and tested for the Stage 3 Facility, as further defined in this Agreement, including Attachment A.
Train 4 Delay Liquidated Damages” has the meaning set forth in Section 13.1D.
Train 4 Performance Liquidated Damages” means the Performance Liquidated Damages for Train 4, as further described in Attachment T.
Train 4 Work” means the Work required to be performed pursuant to this Agreement for Train 4.
Train 5” means (regardless of any assigned numeral for a Train in Schedule A-2) the fifth phase of the Work (which includes the required OSBL) that is designed, procured, constructed, pre-commissioned, commissioned, started up, and tested for the Stage 3 Facility, as further defined in this Agreement, including Attachment A.
Train 5 Delay Liquidated Damages” has the meaning set forth in Section 13.1E.
Train 5 Performance Liquidated Damages” means the Performance Liquidated Damages for Train 5, as further described in Attachment T.
Train 5 Work” means the Work required to be performed pursuant to this Agreement for Train 5.
Train 6” means (regardless of any assigned numeral for a Train in Schedule A-2) the sixth phase of the Work (which includes the required OSBL) that is designed, procured, constructed, pre-commissioned, commissioned, started up, and tested for the Stage 3 Facility, as further defined in this Agreement, including Attachment A.
Train 6 Delay Liquidated Damages” has the meaning set forth in Section 13.1F.
Train 6 Performance Liquidated Damages” means the Performance Liquidated Damages for Train 6, as further described in Attachment T.
Train 6 Work” means the Work required to be performed pursuant to this Agreement for Train 6.
Train 7” means (regardless of any assigned numeral for a Train in Schedule A-2) the seventh phase of the Work (which includes the required OSBL) that is designed, procured, constructed, pre-commissioned, commissioned, started up, and tested for the Stage 3 Facility, as further defined in this Agreement, including Attachment A.
Train 7 Delay Liquidated Damages” has the meaning set forth in Section 13.1G.
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Train 7 Performance Liquidated Damages” means the Performance Liquidated Damages for Train 7, as further described in Attachment T.
Train 7 Work” means the Work required to be performed pursuant to this Agreement for Train 7.
Train-Related Prolongation Costs” means the following time-related costs incurred by Contractor resulting solely from a prolongation to the duration required to complete the Work for a Train: Letter of Credit, temporary construction utilities (temporary electrical, temporary water and chemical toilets) on the Land, clean up and trash dumpster service on the Land, and weather and storm protection and storm cleanup on the Land.
Unforeseen Subsurface Conditions” means any (i) caverns or seismic faults or substantial voids, (ii) substantial manmade or natural subsurface obstructions or (iii) fossils, antiquities or other things of archeological interest, in any case encountered by Contractor in the performance of the Work that (a) are not identified in any Soils Data and (b) with respect to the substantial natural subsurface obstructions in (ii) above, were not reasonably anticipated by Contractor or any of its Subcontractors or Sub-subcontractors, acting in accordance with GECP, from the Soils Data.
Unilateral Change Order” has the meaning set forth in Section 6.1E.
U.S. Dollars” or “U.S. $” means the legal tender of the United States of America.
Value of Foreign Currency” has the meaning set forth in Section 7.10
Vendor” means a Subcontractor or Sub-subcontractor (as the case requires) supplying Equipment.
Warranty” or “Warranties” has the meaning set forth in Section 12.1A.
Weekly Progress Report” has the meaning set forth in Section 3.19A.3.
Windstorms” has the meaning set forth in Section 8.2A.
Work” means all obligations, duties and responsibilities required of Contractor pursuant to this Agreement, including all Equipment, Construction Equipment, spare parts, procurement, engineering, design, fabrication, erection, installation, manufacture, delivery, transportation, storage, construction, workmanship, labor, pre-commissioning, commissioning, inspection, training, Performance Tests, other tests, start-up and any other services, work or things furnished or used or required to be furnished or used, by Contractor in the performance of this Agreement, including that set forth in Attachment A, Section 3.1A and any Corrective Work performed pursuant to Section 12.3. For the avoidance of doubt, the Work shall include the Train 1 Work, the Train 2 Work, the Train 3 Work, the Train 4 Work, the Train 5 Work, the Train 6 Work and the Train 7 Work.
Work Product” has the meaning set forth in Section 10.1.
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1.2Interpretation. The meanings specified in this Article 1 are applicable to both the singular and plural. As used in this Agreement, the terms “herein,” “herewith,” “hereunder” and “hereof” are references to this Agreement taken as a whole, and the terms “include,” “includes” and “including” mean “including, without limitation,” or variant thereof. Unless expressly stated otherwise, reference in this Agreement to an Article or Section shall be a reference to an Article or Section contained in these Terms and Conditions (and not in any Attachments or Schedules to this Agreement) and reference in this Agreement to an Attachment or Schedule shall be a reference to an Attachment or Schedule attached to this Agreement.
ARTICLE 2
RELATIONSHIP OF OWNER, CONTRACTOR AND SUBCONTRACTORS
2.1Status of Contractor. The relationship of Contractor to Owner shall be that of an independent contractor. Any provisions of this Agreement which may appear to give Owner or the Owner Representative the right to direct or control Contractor as to details of performing the Work, or to exercise any measure of control over the Work, shall be deemed to mean that Contractor shall follow the desires of Owner or the Owner Representative in the results of the Work only and not in the means by which the Work is to be accomplished, and Contractor shall have the complete right, obligation and authoritative control over the Work as to the manner, means or details as to how to perform the Work. Nothing herein shall be interpreted to create a master-servant or principal-agent relationship between Contractor, or any of its Subcontractors or Sub-subcontractors, and Owner. Nevertheless, Contractor shall comply with all provisions, terms and conditions of this Agreement, and the fact that Contractor is an independent contractor does not relieve it from its responsibility to fully, completely, timely and safely perform the Work in compliance with this Agreement.
2.2Key Personnel, Organization Chart and Contractor Representative.
A.Key Personnel and Organization Chart. Attachment F sets forth Contractor’s organizational chart to be implemented for the Work and also contains a list of key personnel (“Key Personnel” or “Key Persons”) from Contractor’s organization who will be assigned to the Work. Key Personnel shall, unless otherwise expressly stated in Attachment F, be devoted full-time to the Work for the entire duration of the Project, and Key Personnel shall not be removed or reassigned without Owner’s prior approval (such approval not to be unreasonably withheld). However, if Owner does not issue NTP on or before July 1, 2022, Contractor may reassign its Key Personnel (other than Contractor’s Project Manager), unless Contractor is performing Work pursuant to an LNTP. All requests for the substitution of Key Personnel shall include a detailed explanation and reason for the request and the résumés of professional education and experience for a minimum of two (2) candidates with the requisite qualifications and experience. Should Owner approve of the replacement of a Key Person, Contractor shall allow for an overlap of two (2) weeks during which both the Key Person to be replaced and the Owner-approved new Key Person shall work together full time. The additional cost of any replacement of such Key Personnel and overlap time shall be entirely at Contractor’s expense. Owner has the right, but not the obligation, to require Contractor to remove or cause to be removed Key Persons who are not, in Owner’s reasonable judgment, using GECP in the performance of the portion of the Work assigned to such Key Persons.
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B.Contractor Representative. Contractor designates *** as the Contractor Representative. Notification of a proposed change in Contractor Representative shall be provided in advance, in writing, to Owner. The Contractor Representative is a Key Person.
2.3Subcontractors and Sub-subcontractors. Owner acknowledges and agrees that Contractor intends to have portions of the Work accomplished by Subcontractors pursuant to written Subcontracts between Contractor and such Subcontractors and by Contractor’s Affiliates, and that such Subcontractors may have certain portions of the Work performed by Sub-subcontractors. All Subcontractors and Sub-subcontractors shall be reputable, qualified firms with an established record of successful performance in their respective trades performing identical or substantially similar work. Subject to Section 2.4E, Contractor shall use commercially reasonable efforts to require that all contracts with Subcontractors and Sub-subcontractors be consistent with the terms and provisions of this Agreement. Except as stated in Section 20.4, no Subcontractor or Sub-subcontractor is intended to be or shall be deemed a third-party beneficiary of this Agreement. Contractor shall be fully responsible to Owner for the acts and omissions of Subcontractors and Sub-subcontractors and of its Affiliates performing any Work and of Persons directly or indirectly employed by any of them, as Contractor is for the acts or omissions of Persons directly or indirectly employed by Contractor. The work of any Subcontractor or Sub-subcontractor and Contractor’s Affiliates shall be subject to inspection by Owner, Lender, or Independent Engineer to the same extent as the Work of Contractor. All Subcontractors and Sub-subcontractors and Contractor’s Affiliates and their respective personnel performing Work at the Site are to be instructed by Contractor in the terms and requirements of the safety and environmental protection policies and procedures established under Section 3.10 and shall be expected to comply with such policies and procedures with respect to Work performed at the Land. In the event that any personnel do not adhere to such policies and procedures, such personnel shall be removed by Contractor. In no event shall Contractor be entitled to any adjustment to the Changed Criteria as a result of compliance with such policies and procedures or any removal of personnel necessitated by non-compliance. Nothing contained herein shall (a) create any contractual relationship between any Subcontractor and Owner, or between any Sub-subcontractor and Owner, or between any of Contractor’s Affiliates performing Work and Owner or (b) obligate Owner to pay or cause the payment of any amounts to any Subcontractor or Sub-subcontractor or any of Contractor’s Affiliates. For purposes of Texas Sales and Use Tax, all Subcontracts and Sub-subcontracts will be separated contracts pursuant to Tex. Tax Code § 151.056(b) and 34 Tex. Admin. Code Rule § 3.291(a)(13).
2.4Subcontracts and Sub-subcontracts.
A.Approved List. Attachment G set forth the lists of Subcontractors and Sub-subcontractors that Contractor and Owner have agreed are approved Subcontractors and Sub-subcontractors for the performance of that portion of the Work specified in Attachment G. Approval by Owner of any Subcontractors or Sub-subcontractors does not relieve Contractor of any responsibilities under this Agreement.
B.Additional Proposed Major Subcontractors and Major Sub-subcontractors. In the event that Contractor is considering the selection of a Subcontractor or Sub-subcontractor not listed on Attachment G that would qualify as a Major Subcontractor or Major Sub-subcontractor, Contractor shall (i) notify Owner of its proposed Major Subcontractor or Major Sub-subcontractor as soon as practicable during the selection process and furnish to Owner all
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information reasonably requested by Owner with respect to Contractor’s selection criteria (including information regarding the Major Subcontractors and Major Sub-subcontractors qualifications, safety performance and the agreed scope of work but excluding Major Subcontractors or Major Sub-subcontractors (a) pricing (other than unit rates), discount or credit information, payment terms, payment schedules and retention and (b) performance security, liquidated damages and limitations on liability), and (ii) notify Owner no less than ten (10) Business Days prior to the execution of a Major Subcontract with a Major Subcontractor or Major Sub-subcontract with a Major Sub-subcontractor not listed on Attachment G. Owner shall have the discretion, not to be unreasonably utilized, to reject any proposed Major Subcontractor or Major Sub-subcontractor not listed on Attachment G for a Major Subcontract or Major Sub-subcontract for failing to meet the standard set out in Section 2.3. Contractor shall not enter into any Major Subcontract with a proposed Major Subcontractor or Major Sub-subcontract with a Major Sub-subcontractor that is rejected by Owner in accordance with the preceding sentence. Owner shall undertake in good faith to review the information provided by Contractor pursuant to this Section 2.4B expeditiously and shall notify Contractor of its decision to accept or reject a proposed Major Subcontractor or Major Sub-subcontractor as soon as practicable after such decision is made. Failure of Owner to respond within ten (10) Days after Owner’s receipt of Contractor’s notice of a proposed Major Subcontractor or Major Sub-subcontractor shall be deemed to be an acceptance of such Major Subcontractor or Major Sub-subcontractor. This Section 2.4B does not apply to the selection of Bulk Material Suppliers.
C.Other Additional Proposed Subcontractors and Sub-subcontractors. For any Subcontractor that will perform Work on the Land which are not otherwise covered by Sections 2.4A or 2.4B, Contractor shall, within thirty (30) Days after the execution of a Subcontract with such Subcontractor, but in any event no later than the mobilization of such Subcontractor to the Land, notify Owner in writing of the selection of such Subcontractor and inform Owner generally what portion of the Work such Subcontractor is performing. In addition, for any Sub-subcontractor that will perform Work on the Land which are not otherwise covered by Sections 2.4A or 2.4B, Contractor shall, before any Sub-subcontractor mobilizes to the Land, notify Owner of such Sub-subcontractor and inform Owner generally what portion of the Work such Sub-subcontractor is performing.
D.Delivery of Major Subcontracts and Major Sub-subcontracts. Within ten (10) Days after Owner’s request, Contractor shall furnish Owner with a redacted copy of all Major Subcontracts and Major Sub-subcontracts, or any other Subcontracts or Sub-subcontracts, (excluding only provisions regarding pricing, discount or credit information, payment terms, payment schedules, retention, performance security, liquidated damages and limitations on liability). Notwithstanding the above, Owner’s receipt and review (or non-review) of any Subcontracts or Sub-subcontracts shall not relieve the Contractor of any obligations under this Agreement nor shall such action constitute a waiver of any right or duty afforded Owner under this Agreement or approval of or acquiescence in a breach hereunder.
E.Terms of Major Subcontracts and Major Sub-subcontracts. In addition to the requirements in Section 2.3 and without in any way relieving Contractor of its full responsibility to Owner for the acts and omissions of Subcontractors and Sub-subcontractors, Contractor shall:
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1.include in each Major Subcontract and each Major Sub-subcontract provisions allowing each Major Subcontract and Major Sub-subcontract to be assigned to Owner, at Owner’s sole discretion, without the consent of the respective Major Subcontractor or Major Sub-subcontractor, provided that with respect to Chart, such assignment shall be subject to Chart’s consent, but such consent shall not be withheld unless (i) the assignee is a direct competitor of Chart in the Chart liquefaction process technology or the design or manufacture of brazed aluminum heat exchangers, Cold Boxes (as defined in the Chart License Agreement), nitrogen rejection units (as may be required for the Project scope) and all equipment listed in Schedule 1.25 of the Chart License Agreement; or (ii) the proposed assignment increases Chart’s obligations or liabilities under or relating in any way to the Chart License Agreement; or (iii) the assignment would cause a violation of Applicable Law, and further provided that with respect to each Construction Equipment rental or lease agreement that falls within the definition of Major Subcontract or Major Sub-subcontract, Contractor shall only be obligated to use its best efforts to include a provision that such agreement may be assigned to Owner without the consent of the respective construction equipment lessor; and
2.use reasonable commercial efforts to include in each Major Subcontract and Major Sub-subcontract a provision requiring each Major Subcontractor and Major Sub-subcontractor to comply with all requirements and obligations of Contractor to Owner under this Agreement, as such requirements and obligations are applicable to the performance of the Work under their respective Major Subcontract or Major Sub-subcontract, provided however, notwithstanding the foregoing, Contractor shall, at a minimum, include in each Major Subcontract and Major Sub-subcontract, to the extent such requirements and obligations are applicable to their performance of the Work under the respective Major Subcontract or Major Sub-subcontract, the following:
(i)requirements and obligations substantially similar to those set forth in Article 10, Article 17, and Article 19; Sections 2.3, 2.5C, 3.3D, 3.8, 3.13, 3.16, 3.18, 8.1, 9.1 (and Attachment O), 12.1C, 12.2A, 16.2, 16.3, the Interim Lien Waiver requirements in Section 7.2D and the Final Lien and Claim Waiver requirements in Section 7.3; and
(ii)for all Major Subcontractors and Major Sub-subcontractors performing Work on the Land, requirements and obligations substantially similar to those set forth in Sections 3.6, 3.7, 3.10, 3.17, 3.24, 3.25, in addition to the requirements and obligations set forth in Section 2.4E.2(i).
Notwithstanding the foregoing, Contractor shall not be required to flow down such terms (other than provisions substantially similar to Sections 7.2 and 7.3(d) and (e)) to Bulk Material Suppliers, provided that Contractor is not in any way relieved of its full responsibility to Owner for the acts or omissions of such Bulk Material Suppliers.
2.5Contractor Acknowledgements.
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A.This Agreement. Prior to the execution of this Agreement, Contractor performed or verified the engineering, cost estimating and related services and developed and provided, or verified, the information that forms the Scope of Work and Basis of Design in Attachment A. Subject to Section 4.6A, Contractor hereby agrees and acknowledges that the Scope of Work and Basis of Design are accurate, adequate and sufficiently complete for Contractor to engineer, procure, construct, pre-commission, commission, start-up and test a fully operational Natural Gas liquefaction facility, including seven (7) Trains and associated facilities, for the Contract Price, in accordance with the Guaranteed Dates, and in accordance with all requirements of this Agreement, including Applicable Codes and Standards, Applicable Law, and the Warranties, Minimum Acceptance Criteria and Performance Guarantees. Accordingly, except for Section 4.6A, Contractor hereby (i) agrees that it shall have no right to claim or seek any adjustment to the Changed Criteria with respect to any incomplete, inaccurate or inadequate information or requirements that may be contained or referenced in Attachment A, and (ii) waives and releases Owner from and against such claims. Owner makes no guaranty or warranty, express or implied, as to the accuracy, adequacy or completeness of any such information that is contained or referenced in Attachment A.
B.Conditions of the Site and the Supporting Real Estate.
1.Subject to Section 4.6A, Contractor further agrees and acknowledges that it is sufficiently familiar with the Site (to the extent related to the Work) and the Supporting Real Estate and understands the climate, terrain, topography, subsurface conditions (subject to this Section 2.5B.1) and other difficulties that it may encounter in performing the Work in accordance with the Guaranteed Dates. Except as provided in this Agreement, including Section 6.7 and Section 6.8, Contractor waives any right to claim an adjustment in the Contract Price or the Guaranteed Dates as a result of any of the following conditions at the Site (i) river levels, topography; (ii) climatic conditions, tides, and seasons; (iii) availability of laborers, Subcontractors, Sub-subcontractors, Construction Equipment or any other items or supplies; (iv) adequate availability and transportation of Equipment; and (v) breakdown or other failure of Construction Equipment; provided, however, that Contractor does not assume the risk or waive its rights with respect to those conditions in Sections 2.5B2 and 4.9. This Section 2.5B1 shall not affect the rights of Contractor pursuant to Section 4.3.
2.Contractor assumes all risks related to, and waives any right to claim an adjustment for, any and all subsurface conditions of whatever nature or condition, except as expressly provided in this Section 2.5B.2.
(i)Within one hundred fifty (150) Days after Owner’s issuance of NTP (“Soil Investigation Period”), Contractor may conduct, or cause to be conducted, additional soil testing and investigations (including conducting additional soil borings) in order to further verify the Soils Data and to, at Contractor’s option, further ascertain the subsurface conditions of the Land. Provided that Contractor complies with the requirements set forth in Sections 6.2 and 6.5, if as a result of its investigations Contractor discovers subsurface soil conditions that are materially different than the information described in or what
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was reasonably inferable from the Soils Data, Contractor shall be entitled to a Change Order adjusting the Contract Price to the extent that such differing conditions adversely affect Contractor’s costs of performance of the Work or Contractor’s ability to perform any material requirement of this Agreement and if such differing conditions cause a delay (as that term is defined in Section 6.10), Contractor shall be entitled to relief to the extent permitted in Section 6.8, provided that in any case such conditions were not discovered or reasonably inferred by Contractor or any Subcontractor or Sub-subcontractor, acting in accordance with GECP, from the Soils Data. No later than the completion of the Soil Investigation Period, if Contractor meets its notification and Change Order proposal requirements in this Section 2.5B2(i), the Parties shall negotiate in good faith to reach agreement on such Change Order. If the Parties fail to reach agreement on the adjustment to the Contract Price and/or Guaranteed Dates, then Owner may direct Contractor through a Unilateral Change Order pursuant to Section 6.2D to commence and perform Contractor’s technical solution to such differing conditions. If the Parties mutually agree to a Change Order in accordance with this Section 2.5B2(i), Contractor shall not be entitled to any further relief for subsurface conditions of whatever nature, except for Unforeseen Subsurface Conditions pursuant to Section 2.5B2(ii). If Contractor fails, within the Soil Investigation Period, to (a) notify Owner in accordance with Section 6.5A of such materially different conditions (if any) and (b) provide its proposed Change Order in accordance with Section 6.5B, then Contractor assumes all risks and waives any right to claim an adjustment in the Changed Criteria, including the Contract Price, with respect to any additional costs incurred by Contractor or any Subcontractor and Sub-subcontractor in the performance of the Work in connection with any subsurface conditions of whatever nature or condition, except for Unforeseen Subsurface Conditions pursuant to Section 2.5B2(ii). Owner may not issue a Unilateral Change Order to shorten the Soil Investigation Period or reduce Contractor’s right to conduct additional soil testing and investigations during the Soil Investigation Period, nor may Owner issue a Unilateral Change Order that requires Contractor to perform a different technical solution to address any differing subsurface soil conditions discovered prior to the conclusion of the Soil Investigation Period.
(ii)Provided that Contractor complies with the requirements set forth in Sections 6.2 and 6.5, if Contractor encounters Unforeseen Subsurface Conditions on the Land in the performance of the Work that adversely affect Contractor’s costs of performance of the Work or ability to perform any material requirement of this Agreement, Contractor shall be entitled to a Change Order adjusting the Contract Price pursuant to Sections 6.2A.5 and if such Unforeseen Subsurface Conditions cause a delay (as that term is defined in Section 6.10), Contractor shall be entitled to relief to the extent permitted in Section 6.8. Without prejudice to the foregoing, after the Soil Investigation Period and resulting Change Order, if any, as described in Section 2.5B2(i), Contractor shall not be entitled to a Change Order except in the case of Unforeseen Subsurface Conditions. Notwithstanding anything to the contrary in this Section 2.5B2(ii), to
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the extent Contractor encounters Pre-Existing Contamination or Arsenic, then Section 3.17 shall control.
C.Applicable Law and Applicable Codes and Standards. Contractor has investigated to its satisfaction Applicable Law and Applicable Codes and Standards and warrants that it can perform the Work at the Contract Price and within the Guaranteed Dates in accordance with such Applicable Law and Applicable Codes and Standards, provided however that for Applicable Codes and Standards that are not set forth in Applicable Law, Contractor shall perform the Work in accordance with the Applicable Codes and Standards in effect as of June 23, 2017. Contractor shall perform the Work in accordance with Applicable Law and Applicable Codes and Standards, whether or not such Applicable Law or Applicable Codes and Standards came into effect before the Agreement Date or during the performance of the Work; provided, however, Contractor shall be entitled to a Change Order for Changes in Law to the extent allowed under Section 6.2A.7. Except for any Changes in Law for which Contractor is entitled to a Change Order under Section 6.2A.7 or any Changes in U.S. Duties and Tariffs under Section 6.2A.10 or any Changes in Non-U.S. Duties and Tariffs under Section 6.2A.13, Contractor hereby waives any right to make any claim for adjustment to the Changed Criteria in relation to any change in Applicable Law or Applicable Codes and Standards, including any changes in duties or tariffs.
D.Owner’s Consultants. Owner may designate consultants that are not an employee of Owner to provide certain administrative, management, planning and other services as it deems appropriate to assist with Owner’s rights, remedies and obligations under this Agreement. Such consultants or professionals may, to the extent specified in this Agreement between Owner and such consultants or professionals, act for or on behalf of Owner with respect to Owner’s rights, remedies and obligations under this Agreement, which may include receiving and reviewing certain deliverables and submittals from Contractor, inspecting certain portions of the Work and receiving Contractor’s Confidential Information to the extent necessary to perform such services (having first been bound to an obligation of confidentiality in accordance with this Agreement) to the extent Owner is permitted to do the same under this Agreement, as further specified by Owner to Contractor in writing. Under no circumstances shall such consultants or professionals have any authority to amend this Agreement, sign any Change Order or issue any Unilateral Change Order. In no event will Owner retain as a consultant on this Project any Person that is a Competitor of Contractor.
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ARTICLE 3
CONTRACTOR’S RESPONSIBILITIES
3.1Scope of Work.
A.Generally. Subject to Section 3.1B, the Work shall be performed on a turnkey basis and shall include all engineering, procurement, construction, pre-commissioning, commissioning, start-up and testing of the Stage 3 Facility and all portions thereof, all Equipment, Construction Equipment, spare parts, labor, workmanship, inspection, manufacture, fabrication, installation, design, delivery, transportation, storage, training of Owner’s operation personnel and all other items or tasks that are set forth in Attachment A, or otherwise required to achieve RFFGI, RFSU, and Substantial Completion of each Train and Final Completion of the Stage 3 Facility, including achieving the Minimum Acceptance Criteria and Performance Guarantees in accordance with the requirements of this Agreement. Contractor shall be required to integrate and use such Owner’s personnel in Contractor’s pre-commissioning, commissioning, start-up and testing efforts as required in this Agreement, including Attachment M and Attachment S. Contractor shall perform the Work in accordance with GECP, Applicable Law, Applicable Codes and Standards, and all other terms and provisions of this Agreement, with the explicit understanding that the Stage 3 Facility will operate as a Natural Gas liquefaction facility meeting all requirements and specifications of this Agreement, including Applicable Codes and Standards, Applicable Law, Warranties, Minimum Acceptance Criteria and Performance Guarantees. Subject only to Section 3.1B, it is understood and agreed that the Work shall include any incidental work that can reasonably be inferred as required and necessary to complete the Stage 3 Facility and all portions thereof in accordance with GECP, Applicable Law, Applicable Codes and Standards, and all other terms and provisions of this Agreement, excluding only those items which Owner has specifically agreed to provide under the terms of this Agreement. Without limiting the generality of the foregoing, the Work is more specifically described in Attachment A.
B.Exception to Scope of Work. Contractor shall not be responsible for providing those items expressly identified in Article 4 as Owner’s obligations.
3.2Specific Obligations. Without limiting the generality of Section 3.1 or the requirements of any other provision of this Agreement, Contractor shall:
A.procure, supply, transport, handle, properly store, assemble, erect and install all Equipment;
B.provide construction, construction management (including the furnishing of all Construction Equipment, and all supervision and craft labor), civil/structural, electrical, instrumentation, field design, inspection and quality control services required to ensure that the Work is performed in accordance herewith;
C.negotiate all guarantees, warranties, delivery schedules and performance requirements with all Subcontractors so that all Subcontracts are consistent with this Agreement, as set forth in Sections 2.3 and 2.4;
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D.perform shop and other inspections of the work of Subcontractors and Sub-subcontractors to ensure that such work meets all of the requirements of this Agreement;
E.pay Subcontractors in accordance with the respective Subcontracts;
F.pay all Taxes incurred by Contractor in connection with the Work in a timely fashion, and as between Owner and Contractor, be responsible for all Taxes incurred by any Subcontractor or Sub-subcontractor;
G.ensure the Work is performed in accordance with the Guaranteed Dates;
H.until Substantial Completion of each Train, conduct and manage all pre-commissioning, commissioning, start-up, Performance Tests, other testing, and operations of each Train and the Stage 3 Facility, while directing operation personnel provided by Owner pursuant to Section 4.4;
I.obtain and thereafter maintain all Permits required per Section 3.12;
J.provide prompt assistance, information and documentation required or requested by Owner to enable Owner to obtain any Owner Permits; provided that such assistance, information and documentation shall not include Contractor’s provision of information, testimony, documents or data by Contractor’s employees under oath during litigation (unless specifically authorized by Contractor) and activities outside the field of Contractor’s expertise, training or experience of personnel assigned to the performance of the Work under this Agreement (except to the extent provided for by Change Order issued pursuant to Section 6.1 and agreed by Contractor);
K.provide training for Owner’s operation personnel per Section 3.5;
L.ensure all Subcontractors perform their Subcontract obligations;
M.cooperate with and respond promptly to reasonable inquiries from Owner;
N.obtain and manage all temporary utilities required to complete the Work;
O.perform the engineering, procurement, construction and start-up of all permanent utilities necessary for the commercial operation of the Stage 3 Facility (whether to be constructed within or outside the Site, including all connections and tie-ins to the Stage 3 Facility) except as otherwise provided in Article 4 or Attachment V;
P.supply all initial fills of lubricants, refrigerants and chemicals and transformer oils and all consumables necessary to perform the Work through Substantial Completion of each Train, excluding Owner’s supply requirements of Natural Gas feed for commissioning, start-up, testing and operations as set forth in this Agreement, and as a condition of Substantial Completion, as applicable;
Q.perform all design and engineering Work in accordance with this Agreement, including that specified in Section 3.3; and
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R.comply with its obligations in Attachment LL.
3.3Design and Engineering Work.
A.General. Contractor shall, as part of the Work, perform, or cause to be performed, all design and engineering Work in accordance with this Agreement and cause the Work to meet and achieve the requirements of this Agreement, including achieving the Minimum Acceptance Criteria and Performance Guarantees.
B.Drawings and Specifications. Upon receipt of an LNTP in accordance with Section 5.1 or the NTP issued in accordance with Section 5.2, Contractor shall commence the preparation of the Drawings and Specifications for all Work relating to such LNTP or NTP. The Drawings and Specifications shall be based on the requirements of this Agreement, including the Scope of Work, Basis of Design, GECP, Applicable Codes and Standards, Applicable Law, and all applicable provisions of this Agreement. Contractor shall develop a design document submittal schedule in the form of a master document register and issue to Owner no later than thirty (30) Days after NTP.
C.Review Process.
1.Review. For the period of the Work during which Contractor is continuing to develop design specifications, 3-D model or other similar design documents, Contractor shall coordinate with Owner and provide regular updates to Owner through model reviews, HAZOPs, and other technical discussions.
2.Submission by Contractor. Contractor shall submit copies of the Drawings and Specifications specified in Attachment B to Owner for formal review, comment or disapproval in accordance with (a) Attachment B and (b) the design document submittal schedule provided pursuant to Section 3.3B.
3.Review Periods. Owner shall have up to ten (10) Business Days after its receipt of Drawings and Specifications submitted in accordance with Section 3.3C.2 to issue to Contractor written comments, proposed changes and/or approvals or disapprovals of the submission of such Drawings and Specifications.
4.No Owner Response. If Owner does not issue any comments, proposed changes, approvals or disapprovals within such time periods set forth in Section 3.3C.3, Contractor may proceed with the development of such Drawings and Specifications and any construction relating thereto, but Owner’s lack of comments, approval or disapproval, if applicable, shall in no event constitute an approval of the matters received by Owner.
5.Disapproval by Owner. If Owner disapproves of the Drawings or Specifications (which disapproval shall not be exercised unreasonably), Owner shall provide Contractor with a written statement of the reasons for such disapproval within the time period required for Owner’s response for disapproval of Drawings and Specifications set forth in Section 3.3C.3. Contractor shall provide Owner with revised
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and corrected Drawings and Specifications as soon as possible thereafter and Owner’s rights with respect to issuing comments, proposed changes, approvals or disapprovals of such revised and corrected Drawings or Specifications are governed by the procedures specified above in this Section 3.3C; provided that Contractor shall not be entitled to any adjustment to the Changed Criteria, unless: (a) such disapproval is exercised unreasonably (e.g., due to one or more material changes required by Owner to any such Drawings or Specifications and not the result of noncompliance of such Drawings or Specifications with the requirements of this Agreement), (b) such disapproval and associated changes adversely impact Contractor’s costs or ability to perform the Work in accordance with the Monthly Updated Project Schedule, and (c) Contractor complies with and meets the requirements under Article 6.
6.Approval by Owner. Upon Owner’s approval of the Drawings and Specifications, such Drawings and Specifications shall be the Drawings and Specifications that Contractor shall use to construct the Work; provided that Owner’s review or approval of any Drawings and Specifications (or Owner’s lack of comments, proposed changes or approval) shall not in any way be deemed to limit or in any way alter Contractor’s responsibility to perform and complete the Work in accordance with the requirements of this Agreement, and in the event that there is a discrepancy, difference or ambiguity between the terms of this Agreement and any Drawings and Specifications, the terms of this Agreement shall control. Due to the limited time for Owner’s review of Drawings and Specifications, Contractor’s or its Subcontractors’ or Sub-subcontractors’ expertise in the Work and Owner’s contractual expectation for Contractor to prepare accurate and complete Drawings and Specifications, Contractor recognizes and agrees that Owner is not required or expected to make detailed reviews of Drawings and Specifications, but instead Owner’s review of Drawings and Specifications may be of only a general, cursory nature. Accordingly, any review or approval given by Owner under this Agreement (or Owner’s non-response) with respect to any Drawings or Specifications shall not in any way be, or deemed to be, an approval of any Work, Drawings or Specifications not meeting the requirements of this Agreement, as Contractor has the sole responsibility for performing the Work in accordance with this Agreement.
D.Design Licenses. Contractor shall perform, or cause to be performed, all design and engineering Work in accordance with Applicable Law and Applicable Codes and Standards, and all Drawings, Specifications and design and engineering Work shall be signed and stamped by design professionals licensed to the extent required by Applicable Law.
E.CAD Drawings. Unless otherwise expressly provided under this Agreement, all Drawings and Record As-Built Drawings prepared by Contractor or its Subcontractors under this Agreement shall be prepared using computer aided design (“CAD”). All Contractor CAD drawing files shall be in fully operable and editable in native format as set forth in Attachment B. Contractor shall use reasonable efforts to also provide Drawings, including Record As-Built Drawings, in other formats requested by Owner.
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F.As-Built Drawings. During construction, Contractor shall keep a redlined, marked, up-to-date set of As-Built Drawings on the Site as required under Attachment B. Contractor shall make redlined documents available to Owner for inspection upon request during the course of construction. As a condition precedent to Final Completion, Contractor shall deliver to Owner the Record As-Built Drawings and Specifications in accordance with Attachment B, which shall include delivery of final as-built drawing files in fully operable and editable format in CAD.
G.SmartPlant Files. Contractor shall, as a part of the requirements for achieving Final Completion, provide all SmartPlant native files and other associated design native files to Owner as required under Attachment B. This shall include Contractor furnishing SmartPlant electrical, SmartPlant instrumentation, and SmartPlant P&ID native files to Owner.
H.Other Information. Contractor shall deliver copies of all other documents required to be delivered pursuant to Attachment B within and in accordance with the requirements and timing set forth in Attachment B.
3.4Spare Parts.
A.Commissioning Spare Parts. Contractor shall provide all pre-commissioning, commissioning, start-up and testing spare parts necessary to achieve Substantial Completion of each Train, as applicable, and shall deliver such spare parts for such Train to the Site. The cost associated with all Work related to such pre-commissioning, commissioning, start-up and testing spare parts is included in the Contract Price, including all Work related to procuring and storing the commissioning spare parts and the purchase price for such parts.
B.Capital Spare Parts. Prior to Final Completion, Contractor shall deliver to the Site all the Capital Spare Parts that pertain to such Train. Such Capital Spare Parts are listed in Attachment W, and the cost associated with all Work related to such Capital Spare Parts is included in the Capital Spare Parts Provisional Sum (which is part of the Contract Price, provided that at the Effective Date, the Capital Spare Parts Provisional Sum is equal to *** U.S. Dollars (U.S.$ ***), including the cost of procurement of such spare parts, the transportation, preservation and handling costs of such spare parts and the actual out-of-pocket purchase price of such spare parts. To the extent that Contractor desires to use any Capital Spare Parts, Contractor must obtain Owner’s prior approval, not to be unreasonably withheld, and promptly replace all such spare parts, unless otherwise approved by Owner.
C.Operating Spare Parts and Consumables. With respect to operating spare parts and consumables for use after Substantial Completion, Contractor shall deliver to Owner for Owner’s approval a detailed priced list of the manufacturer and Contractor-recommended operating spare parts and consumables for each applicable item of Equipment necessary for operating such Equipment for two (2) years. The purchase price of each operating spare part shall be provided to Owner for each item of Equipment for which there is manufacturer or Contractor-recommended operating spare parts or consumables no later than one hundred twenty (120) Days after the execution of the applicable Subcontract for such Equipment, and such purchase prices will be valid for one hundred eighty (180) Days after Contractor’s execution
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thereof. Owner may respond to Contractor identifying which operating spare parts or consumables, if any, that Owner wishes Contractor to procure under each Subcontract within such one hundred eighty (180) Day period. The cost associated with all Work related to the two (2) years’ operating spare parts and consumables is included in the Contract Price, except for the purchase price (including transport) of such operating spare parts and consumables. In the event Owner requests in writing that Contractor procure any operating spare parts or consumables on Owner’s behalf, Contractor shall be entitled to a Change Order in accordance with Section 6.2A.6 to increase the Contract Price for the actual purchase price and delivery costs of such requested operating spare parts or consumables, plus costs of transportation, preservation and a profit of *** percent (***%) on such price and costs. To the extent that Contractor desires to use any operating spare parts or consumables, Contractor must obtain Owner’s prior approval and promptly replace all such spare parts or consumables.
3.5Training Program in General. As part of the Work, a reasonable number of competent personnel, who are capable of being trained by Contractor, designated by Owner in its sole discretion (but not to exceed the number of Persons listed in Attachment M) shall be given training designed and administered by Contractor at its expense, which shall be based on the program requirements contained in Attachment A and shall cover at a minimum the following topics: (i) the testing of each item of Equipment; (ii) the start-up, operation and shut-down of each item of Equipment; (iii) the performance of routine, preventative and emergency maintenance for each item of Equipment; and (iv) spare parts to be maintained for each item of Equipment, and their installation and removal. Such training shall include instruction for Owner’s operations personnel in the operation and routine maintenance of each item of Equipment prior to completion of commissioning of each item of Equipment. As part of the training, Contractor shall provide Owner’s operating personnel with full access to the Stage 3 Facility during commissioning, start-up and testing. Training shall be provided by personnel selected by Contractor who, in Contractor’s and the Equipment Subcontractor’s or Sub-subcontractor’s judgment, are qualified to provide such training, and shall take place at such locations and at such times as agreed upon by the Parties. Contractor shall provide trainees with materials described in Attachment A and Attachment M. Contractor shall also provide to Owner all training materials and aids developed to conduct such training in order to facilitate future training by Owner of personnel hired after Substantial Completion.
3.6Environmental Regulations and Environmental Compliance. No later than the earlier of sixty (60) Days after NTP or thirty (30) Days prior to the commencement of the Work on the Land, Contractor shall submit for Owner’s approval, not to be unreasonably withheld, a Project-specific environmental policies and procedures. Such policies and procedures shall be in compliance with requirements of this Agreement, including Applicable Law and the policies and procedures set forth in Attachment J. Without limitation of Section 3.1, Contractor is responsible for performing the Work in compliance with all provisions of this Agreement regarding the environment and Applicable Law and in compliance with the policies and procedures set forth in Attachment J and the Contractor’s Project-specific policies and procedures approved by Owner (where applicable). Contractor shall maintain all environmental compliance records required by Applicable Law and shall provide, or cause to be provided, necessary training to its employees, Subcontractors and Sub-subcontractors to ensure their compliance with the environmental requirements of this Agreement. Contractor shall, at its sole cost and expense, dispose of all non-hazardous wastes and Hazardous Materials generated during the performance of the Work (excluding any Hazardous Materials arising from Pre-Existing Contamination
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and Arsenic) or brought onto the Land by Contractor, any Subcontractor or any Sub-subcontractor during performance of the Work at off-Site disposal facilities permitted to receive such wastes and Hazardous Materials. Contractor shall provide copies of all waste and disposal records and reports to Owner. Contractor shall report to Owner, as soon as reasonably possible after having knowledge thereof and in no event later than one (1) Day after such occurrence, any violation of the foregoing. Contractor shall, at its sole cost and expense, remediate the on-Land release of any Hazardous Materials generated during the performance of the Work (excluding any Hazardous Materials arising from Pre-Existing Contamination and Arsenic) or brought onto the Land by Contractor, any Subcontractor or any Sub-subcontractor or other event in violation of this Section 3.6.
3.7Contractor’s Tools and Construction Equipment. Contractor shall furnish all Construction Equipment necessary and appropriate for the timely and safe completion of the Work in compliance with this Agreement. Notwithstanding anything to the contrary contained in this Agreement, Contractor shall be responsible for damage to or destruction or loss of, from any cause whatsoever, all Construction Equipment owned, rented or leased by Contractor or its Subcontractors or Sub-subcontractors for use in accomplishing the Work. Contractor shall require all insurance policies (including policies of Contractor and all Subcontractors and Sub-subcontractors) in any way relating to such Construction Equipment to include clauses stating that each underwriter will waive all rights of recovery, under subrogation or otherwise, against any and all members of the Owner Group.
3.8Employment of Personnel.
A.Contractor shall not employ or retain, or permit any Subcontractor or Sub-subcontractor to employ or retain, in connection with its performance under this Agreement anyone who is unsafe, not skilled, or not qualified to perform the work assigned to such Person. Contractor agrees to promptly remove or reassign (or to require any Subcontractor or Sub-subcontractor to remove or reassign) from its services in connection with the Work any Person who does not meet the foregoing requirements, excluding vendors or suppliers who are not performing Work on the Land. In addition, Contractor agrees that within forty-eight (48) hours after receipt of notice from Owner, it shall remove from the Work any employee or agent of Contractor or of Contractor’s Subcontractors or Sub-subcontractors who, in Owner’s reasonable opinion, is unsafe, incompetent, careless, unqualified to perform the Work assigned to such Person, creates an unsafe work environment, persists in any conduct which is prejudicial to safety, health, or the protection of the environment, disregards the terms and conditions of this Agreement, or is interrupting, interfering with or impeding the timely and proper completion of the Work. Notwithstanding the foregoing, Owner shall have no liability and Contractor agrees to release, indemnify, defend and hold harmless any and all members of the Owner Group from and against any and all claims, causes of action, damages, costs, losses and expenses (including all attorneys’ fees and litigation expenses) and liabilities, of whatsoever kind or nature, which may arise or result from Contractor or any Subcontractor or Sub-subcontractor terminating the employment of or removing or reassigning from the Work any such employee or agent who fails to meet the foregoing requirements following a request by Owner to have such employee removed or reassigned from the Work. Contractor shall replace any such employee or agent at its sole cost and expense.
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B.Contractor is responsible for maintaining labor relations in such manner that there is reasonable harmony among the employees of Contractor and its Subcontractors and Sub-subcontractors performing Work at the Land. Contractor and its Subcontractors and Sub-subcontractors performing Work at the Land shall conduct their labor relations in accordance with the recognized prevailing local area practices. Contractor shall inform Owner promptly of any labor dispute, anticipated labor dispute, request or demand by a labor organization, its representatives or members which may reasonably be expected to affect the Work. Contractor further agrees to inform Owner, before any commitments are made, about the negotiations of any agreements or understandings with local or national labor organizations.
C.Contractor and its Subcontractors and Sub-subcontractors and the personnel of any of them shall not bring onto the Land any: (i) firearm of whatsoever nature, knife with a blade exceeding four (4) inches (100 millimeters) in length or other object which in the sole judgment of Owner is determined to be a potential weapon; (ii) alcoholic beverages or intoxicants of any nature; (iii) substance that creates a hazard and not related to the Work; (iv) animal; (v) illegal drugs of any nature; (vi) drugs (whether prescription or non-prescription) which impair physical or mental faculties; or (vii) prescription drugs without a valid prescription.
D.In connection with the enforcement of this Section 3.8D, all employees and agents of Contractor and its Subcontractors and Sub-subcontractors shall successfully complete a drug screening test prior to performing Work on the Land, and periodically thereafter in accordance with the requirements of Contractor’s safety program required under Section 3.10. Contractor and its Subcontractors and Sub-subcontractors shall abide by and enforce the requirements of this Section 3.8D, and shall immediately remove from the Work and the Land to the extent permitted by Applicable Law any employee or agent of Contractor, Subcontractor or Sub-subcontractor who has violated the requirements of this Section 3.8D. The provisions of Section 3.8A with regard to liability of any member of the Owner Group and Contractor’s release, indemnification, defense and hold harmless obligations shall apply to the removal of any such Person under this Section 3.8D.
3.9Clean-up. Contractor shall, to Owner’s reasonable satisfaction, keep the Land free from all waste materials or rubbish caused by the activities of Contractor or any of its Subcontractors or Sub-subcontractors. As soon as practicable after the completion of all Punchlist items, Contractor shall remove, at its own cost, all Construction Equipment and other items not constituting part of the Stage 3 Facility (other than as required by Contractor to fulfil its obligations under Section 12.3A) and remove all such waste material, Hazardous Materials and rubbish where any of such are brought on to the Land by Contractor from the Land (unless Owner otherwise approves) and restore the Land in accordance with this Agreement. In the event of Contractor’s failure to comply with any of the foregoing, Owner may accomplish the same; provided, however, that Contractor shall be liable for and pay to Owner (directly, by offset, or by collection on the Letter of Credit, at Owner’s sole option) all reasonable costs associated with such removal and/or restoration, including reasonable costs associated with permitting, transportation and disposal at an authorized location.

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3.10Safety and Security. Contractor recognizes and agrees that safety and physical security are of paramount importance in the performance of the Work and that Contractor is responsible for performing the Work in a safe and physically secure manner. No later than the earlier of sixty (60) Days after NTP or any LNTP or thirty (30) Days prior to the commencement of the Work on the Land, Contractor shall deliver to Owner a safety program for Owner’s review. Contractor’s safety program shall specify the written policies and procedures for maintaining and supervising all environmental, health and safety precautions and programs in connection with the performance of the Work, including appropriate precautions and Work-specific detailed programs for areas in and around the Land and the handling, collecting, removing, transporting or disposing of Hazardous Materials for which Contractor is responsible under this Agreement, in order to ensure prudent practice on the Land for the safety of all Persons on the Land. Contractor further agrees to perform the Work in accordance with the safety and health rules and standards of Applicable Law (including OSHA) and such safety program, and Contractor shall assume all costs associated with compliance therewith. Contractor’s safety program shall include the Owner’s requirements set forth in Attachment J. Owner’s review of Contractor’s safety program shall not in any way relieve Contractor of its responsibility regarding safety, and Owner, in reviewing such safety program, assumes no liability for such safety program. Contractor shall appoint one or more (as appropriate) safety representative(s) acceptable to Owner who shall be resident on the Land, have responsibility to immediately correct unsafe conditions or unsafe acts associated with the Work and the Stage 3 Facility, act on behalf of Contractor on safety and health matters, and participate in periodic safety meetings with Owner after Work has commenced on the Site. Contractor further agrees to provide or cause to be provided necessary training and safety Construction Equipment to its employees, Subcontractors and Sub-subcontractors to ensure their compliance with the foregoing safety and health rules and standards and enforce the use of such training and Construction Equipment. Contractor shall maintain all accident, injury and any other records required by Applicable Law or by Contractor’s safety program and shall furnish Owner a Monthly summary of injuries and labor hours lost due to injuries. Should Owner at any time observe Contractor, or any of its Subcontractors or Sub-subcontractors, performing the Work in an unsafe manner, or in a manner that may, if continued, become unsafe, then Owner shall have the right (but not the obligation) to require Contractor to stop the portion of the Work that is being performed in an unsafe manner until such time as the manner of performing the Work has been rendered safe; provided, however, that at no time shall Contractor be entitled to an adjustment to the Changed Criteria based on such work stoppage. Contractor shall be responsible for the security, fencing, guarding, temporary facilities, lighting, and supervision of the Stage 3 Facility, the Site and the Supporting Real Estate each as required and described in Attachment A until all of the requirements of Substantial Completion for an applicable Train have been satisfied. Nothing in this Section 3.10 shall affect Contractor’s status as an independent contractor. With respect to (i) the Land’s access requirements, restrictions and procedures, (ii) Owner’s safety and security rules and procedures and (iii) other such safety rules and procedures as required by the Site’s landowner or Applicable Laws, provided that, with respect to (i) through (iii) inclusive, such requirements, restrictions, rules and procedures have been provided to Contractor by Owner prior to the Agreement Date (except to the extent such information is in the public domain), Contractor acknowledges that it has fully investigated and has taken such requirements, rules and procedures into account in planning the Work to be performed in accordance with the Guaranteed Dates. Further, Contractor shall comply with any Site access, safety and security requirements, restrictions, rules and procedures imposed by Owner, or the Site’s landowner provided that such have been provided to Contractor by Owner (to the extent such information is not available to the public domain) prior to the Agreement Date or as otherwise
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mutually agreed between the Parties; provided that Contractor shall in all cases comply with any requirements, restrictions, rules and procedures imposed by Applicable Law, regarding Site access and performance of the Work on the Site. As such, Contractor shall not be entitled to a Change Order to adjust the Contract Price or Guaranteed Dates as a result of Contractor’s (including its Subcontractors and Sub-subcontractors) compliance with such access, safety and security requirements, restrictions, rules and procedures except to the extent of any material changes made thereto by the Site’s landowner subsequent to the Agreement Date. Contractor (i) is aware of all Applicable Law and safety requirements established by Governmental Instrumentalities (including social distancing and use of protective equipment) and applicable guidelines issued by the Center for Disease Control relating to COVID-19 that were issued prior to or as of the Agreement Date, and (ii) has taken such requirements and guidelines into account in planning the Work and developing the Contract Price, COVID-19 Provisional Sum, and Guaranteed Dates.
3.11Emergencies. In the event of any emergency endangering life or property in any way relating to the Work, the Stage 3 Facility or the Site, whether on the Site or otherwise, Contractor shall take such action as may be reasonable and necessary to prevent, avoid or mitigate injury, damage, or loss and shall, as soon as reasonably possible, report any such incidents, including Contractor’s response thereto, to Owner. If Contractor fails to take such action and the emergency requires immediate action, then Owner, with or without notice to Contractor may, but shall be under no obligation to, take reasonable action as required to address such emergency. The taking of any such action by Owner, or Owner’s failure to take any action, shall not limit Contractor’s liability. Contractor shall reimburse Owner for the performance of any work or furnishing of any equipment or other items in connection with any emergency in an amount equal to the reasonable costs incurred by Owner in such performance of work or furnishing of equipment or other items.
3.12Approvals, Certificates, Permits and Licenses.
A.Contractor shall obtain Owner approval prior to engaging in any communication related to an Owner Permit with a Governmental Instrumentality (whether verbal, written, electronic or otherwise). Additionally, Contractor shall copy Owner on all correspondence related to Owner Permits between Contractor and any Governmental Instrumentality (whether written, electronic, facsimile, or otherwise), and to the extent Contractor receives any such correspondence from a Governmental Instrumentality, Contractor shall provide Owner with copies of all such correspondence no later than five (5) Days of Contractor’s receipt. Notwithstanding the preceding sentence, Contractor shall not take or omit to take any action that violates or jeopardizes any required Permit or approval of a Governmental Instrumentality.
B.Other than the Owner Permits, Contractor shall obtain in a timely manner so as not to delay performance of the Work, all Permits required to perform the Work, including the Permits listed in Attachment P. All Permits obtained by Contractor shall be valid for the full duration of time in which Contractor is required to perform the Work, including the Defect Correction Period, as applicable. Contractor shall provide Owner with copies of such Permits as soon as they are obtained.
C.Contractor shall provide information, assistance and documentation to Owner as reasonably requested in connection with the Owner Permits. Without limiting the generality of
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the foregoing, Contractor acknowledges that Owner is required to provide regular reports and other information to FERC during the design and construction of the Stage 3 Facility, and that the Stage 3 Facility will be subject to regular inspections by FERC staff, and continuous monitoring by inspectors providing reports to FERC. Contractor shall provide continuing support services relating to the FERC and regulatory processes, including the preparation of all design and engineering documentation necessary to conform and update Owner’s FERC filings, TCEQ filings, and other filings with respect to the Scope of Work, either prior to or following the issuance of the final FERC Order for the Project. Contractor shall also perform the engineering with respect to the Owner Permits in accordance with Attachment A, and shall cooperate with FERC staff and inspectors, and take such actions as necessary to facilitate FERC monitoring and inspection programs.
D.Contractor shall not be entitled to any adjustment to the Changed Criteria to the extent Owner’s failure to obtain a FERC Authorization or another Owner Permit is due to Contractor’s failure to comply with Section 3.12C or to cooperate with Owner or any relevant Governmental Instrumentality.
3.13Books, Records and Audits.
A.Contractor shall keep full and detailed books, construction and manufacturing logs, records, daily reports, accounts, schedules, payroll records, receipts, statements, electronic files, correspondence and other pertinent documents as may be necessary for proper management under this Agreement, as required under Applicable Law or this Agreement (“Books and Records”). Contractor shall maintain all such Books and Records in accordance with generally accepted accounting principles applicable in the United States and shall retain all such Books and Records for a minimum period of time equal to the greater of: (i) three (3) years after Final Completion, or (ii) such period of time as may be required under Applicable Law.
B.Upon reasonable notice, Owner, Lender, and Independent Engineer shall have the right to audit or to appoint an independent public accounting firm to audit Contractor’s Books and Records; provided, however, with respect to an independent public accounting firm, such Lender, Independent Engineer and independent public accounting firm and their representatives shall first execute a confidentiality agreement with Contractor in accordance with the standard practice in the auditing industry for audits of this kind. Contractor’s Books and Records may be audited as necessary to (i) validate all amounts billed under any Change Orders that are not a fixed price or with respect to any Provisional Sums, and (ii) review and confirm safety and quality records. When requested by Owner, Contractor shall provide the auditors with reasonable access to all such relevant Books and Records at Owner’s expense, and Contractor’s personnel shall cooperate with the auditors to effectuate the audit or audits hereunder. The auditors shall have the right to copy such Books and Records. Contractor shall bear all reasonable costs and expenses incurred by it in assisting Owner with audits performed pursuant to this Section 3.13. The restrictions in this Section 3.13B to the audit rights of Owner, Lender or Independent Engineer shall not control over any rights such parties have under Applicable Law, in discovery in any litigation arising out of Article 18 or in any litigation against a Guarantor.
3.14Tax Accounting.
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A.Within a reasonable period of time (not to exceed thirty (30) Days) following Contractor’s receipt of Owner’s written request therefor, Contractor shall provide Owner’s tax consultant with any information regarding quantities, descriptions and sales prices or any other information, including Books and Records, as reasonably deemed necessary by Owner in connection with the preparation of its tax returns (including information reasonably required to determine the amount of Qualified Research Expenditures incurred in connection with the Work) or other tax documentation in connection with the Project; provided, however, if, in connection with such preparation, Owner’s tax consultant requests information relating to the actual cost for any item of Work and such item of Work is included in the Contract Price or in any fixed price Change Order, Contractor shall provide such information to Owner’s tax consultant. The Parties agree that such tax consultant shall not disclose to Owner the actual cost incurred by Contractor or its Subcontractors or Sub-subcontractors for any item of Work (including Equipment) listed in Attachment CC. No access to the aforementioned information (including Books and Records) shall be granted to Owner’s tax consultant until such tax consultant has signed a confidentiality agreement with Contractor in accordance with the standard practice in the auditing industry for audits of this kind. Owner shall bear the cost of its own tax consultants in connection with any audits pursuant to this Section 3.14.
B.Contractor acknowledges that Owner is pursuing ad valorem tax abatement through the Texas Commission on Environmental Quality, and upon request, Contractor shall provide to Owner and Owner’s tax consultant access to documentation required or requested by the Texas Commission on Environmental Quality or any other Governmental Instrumentality in order for Owner to perfect such abatement related to the sales price of Equipment, including Equipment sales price, price of fabrication and design specifications and installation labor sales price, which is inclusive of overhead and all other indirect costs. Documentation shall consist of asset name or Equipment reference number, a description of the asset, amount charged by Contractor to Owner and other such documentation as may be reasonably required. Contractor agrees to offer similar assistance to Owner toward any other federal, state or local program that is enacted and would allow for a reduction, rebate, abatement or exemption of (i) Taxes or (ii) Texas Sales and Use Tax on Equipment listed in Attachment CC.
3.15Temporary Utilities, Roads, Facilities and Storage.
A.Prior to Substantial Completion of the relevant Train and except for those utilities designated to be provided by Owner pursuant to Article 4, Contractor shall provide and pay for all utilities (e.g., electricity, water, communication, cable, telephone, waste and sewer) with respect to such Train, including all connections and substations, necessary for the performance of the Work, including installation, Permit and usage costs.
B.Contractor shall construct and maintain temporary access and haul roads as may be necessary for the proper performance of this Agreement. Roads constructed on the Land shall be subject to Owner’s approval, not to be unreasonably withheld. Contractor shall provide Owner with sufficient office space at the time of Contractor’s mobilization at the Site and the Supporting Real Estate to accommodate Owner’s Representative and support staff. Contractor shall provide Owner with all office space, construction trailers, utilities, storage and
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warehousing, security, telephones, furnishings, and other temporary facilities required for their oversight of the Work, as set forth in more detail in Attachment A.
C.All Equipment and other items comprising part of the Work stored at a location other than on the Land shall be segregated from other goods, and shall be clearly marked as “Property of Corpus Christi Liquefaction Stage III, LLC.”
3.16Subordination of Liens. In consideration of *** U.S. Dollars (U.S. $***) included as part of the Contract Price and as part of the consideration of receiving this Agreement and other valuable consideration received and acknowledged by Contractor, Contractor hereby subordinates any mechanics’ and materialmen’s liens or other claims or encumbrances that may be brought by Contractor against any or all of the Work, the Land or the Stage 3 Facility to any liens granted in favor of Lender, whether such lien in favor of Lender is created, attached or perfected prior to or after any such liens, claims or encumbrances, and shall require its Subcontractors and Sub-subcontractors to similarly subordinate their lien, claim and encumbrance rights. Contractor agrees to comply with reasonable requests of Owner for supporting documentation required by Lender, including any necessary lien subordination agreements, affidavits or other documents that may be required to demonstrate that Owner’s property and premises are free from liens, claims and encumbrances arising out of the furnishing of Work under this Agreement. Nothing in this Section 3.16 shall be construed as a limitation on or waiver by Contractor of any of its rights under Applicable Law to file a lien or claim or otherwise encumber the Project as security for any undisputed payments owed to it by Owner hereunder that are past due, provided that such lien or claim is subordinate to any liens granted in favor of Lender.
3.17Hazardous Materials. Contractor shall not, nor shall it permit or allow any Subcontractor or Sub-subcontractor to, bring any Hazardous Materials onto the Land and shall bear all responsibility and liability for such materials; provided, however, that Contractor may bring onto the Land such Hazardous Materials in such quantities as are necessary to perform the Work so long as the same is done in compliance with Applicable Law, Applicable Codes and Standards, and the requirements specified in Attachment J, and Contractor shall remain responsible for all such Hazardous Materials.
A.It is acknowledged that Contractor may encounter Arsenic in the performance of the Work and that there may be residual soil and groundwater produced in the performance of the Work. Within forty five (45) Days after the earlier of LNTP or NTP, Contractor and Owner shall develop and mutually agree on a written plan for the performance of the Work in consideration of the presence of Arsenic at the Site (provided however that if the Parties fail to agree on the plan prior to commencement of Work at the Site, then Contractor will incorporate any of Owner’s comments to the plan that Contractor agrees with, acting reasonably and in accordance with GECP, and Contractor shall then comply with such plan on an ongoing basis while also continuing to try to reach agreement with Owner with respect to the parts of the plan that were not agreed to). Such plan shall include a requirement for Owner to conduct regular testing of such residual soil and/or groundwater to determine, among other requirements as agreed upon in the plan, when Contractor must stop the Work (including that notwithstanding Section 3.17C, where such Arsenic remains in place, Contractor shall not be required to suspend the Work nor to notify Owner) and whether the disposal of Arsenic is required. Provided that Contractor materially complies with the plan developed pursuant to this Section 3.17A,
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Contractor shall have no liability for Arsenic at the Site. However, if and to the extent Contractor fails to comply with such plan and such failure increases the damages, costs, losses and expenses with respect to such exacerbation of the Arsenic at the Site, then Contractor shall be liable to Owner for such incremental damages, costs, losses and expenses with respect to such exacerbation of Arsenic contamination on the Land, subject to the Aggregate Cap (as set forth below) and Owner hereby releases Contractor, its Subcontractors or Sub-subcontractors from any such liability of Contractor for Arsenic, when combined with any liability for the SWMU pursuant to Section 3.17B and Pre-Existing Contamination pursuant to Section 3.17C, in excess of the Aggregate Cap. For the avoidance of doubt, any such liability of Contractor for Arsenic, when combined with liability pursuant to Section 3.17B (if any) and Section 3.17C (if any), shall in no event exceed the Aggregate Cap in the cumulative aggregate. Notwithstanding the requirements in this Agreement related to Pre-Existing Contamination, Contractor’s liability for Arsenic is set forth in this Section 3.17A.
B.Contractor has no obligation to identify, characterize, manage, manifest, treat, store, remediate, remove, transport or dispose of any Pre-Existing Contamination or Arsenic. Owner shall be responsible for the investigation and response to any Pre-Existing Contamination and any Arsenic, and any such investigation and response shall be performed expeditiously and in accordance with Applicable Law, Applicable Codes and Standards so as to not adversely impact Contractor’s costs or ability to perform the Work in accordance with the Monthly Updated Project Schedule. Owner shall ensure that it has an authorized solid waste management unit located on the Land (the “SWMU”) that is permitted to receive Pre-Existing Contamination and Arsenic that may be produced or released on, or removed from, the Site in connection with construction of the Project, and that Owner intends to transfer any such Pre-Existing Contamination or Arsenic (to the extent required pursuant to the plan described in Section 3.17A) produced, released on or removed from the Site in connection with the Work to the SWMU. Owner agrees that the SWMU shall not accept any Hazardous Materials generated by any third party or from any location off-site of the Land. Provided that Contractor materially complies with its plan described in Section 3.17A with respect to its use of the SWMU, Contractor shall have no liability for the SWMU. However, if and to the extent Contractor fails to comply with such plan and such failure increases the damages, costs, losses and expenses with respect to the SWMU, then Contractor shall be liable to Owner for such incremental damages, costs, losses and expenses with respect to the SWMU, subject to the Aggregate Cap (as set forth below) and Owner hereby releases Contractor, its Subcontractors or Sub-subcontractors from any such liability of Contractor for the SWMU, when combined with any liability for Arsenic pursuant to Section 3.17A and Pre-Existing Contamination pursuant to Section 3.17C, in excess of the Aggregate Cap. For the avoidance of doubt, any such liability of Contractor for the SWMU, when combined with liability pursuant to Sections 3.17A (if any) and 3.17C (if any), shall in no event exceed the Aggregate Cap in the cumulative aggregate. Notwithstanding the requirements in this Agreement related to Arsenic and Pre-Existing Contamination, Contractor’s liability for the SWMU is set forth in this Section 3.17B.
C.Subject to Section 3.17A, if Contractor or any Subcontractor or Sub-subcontractor encounter Pre-Existing Contamination on the Land, and Contractor knows that such material is Hazardous Material, Contractor and its Subcontractors and Sub-subcontractors shall immediately stop Work in the affected area and notify Owner. If under such circumstances Contractor or any
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of its Subcontractors or Sub-subcontractors fail to stop the Work and notify Owner, Contractor shall, subject to Section 3.17A with respect to Arsenic, be responsible and liable to Owner for all damages, costs, losses and expenses to the extent such failure increases the damages, costs, losses and expenses with respect to such exacerbation of Pre-Existing Contamination at the Site, subject to the Aggregate Cap and Owner hereby releases Contractor, its Subcontractors or Sub-subcontractors from any such liability of Contractor for Pre-Existing Contamination, when combined with any liability for Arsenic pursuant to Section 3.17A and any liability for the SWMU pursuant to Section 3.17B, in excess of the Aggregate Cap. For the avoidance of doubt, any such liability of Contractor for Pre-Existing Contamination, when combined with any liability of Contractor with respect to the SWMU pursuant to Section 3.17B (if any) and with respect to Arsenic pursuant to Section 3.17A (if any) shall not exceed *** U.S. Dollars (U.S. $***) in the total cumulative aggregate for both Arsenic and Pre-Existing Contamination (the “Aggregate Cap”) under this Agreement.
D.If Contractor or its Subcontractors or Sub-subcontractor encounters Pre-Existing Contamination or Arsenic requiring disposal in accordance with the plan to be developed under Section 3.17A in the performance of Work, Contractor shall: (i) suspend the performance of the Work in the affected area; (ii) notify Owner immediately; and (iii) to the extent reasonably practicable, continue working in the non-affected areas. Contractor and its Subcontractors and Sub-subcontractors shall not be required to resume Work in connection with such Pre-Existing Contamination or Arsenic, or in any area affected thereby until Owner has: (i) obtained any required permits or other approvals related thereto; and (ii) delivered to Contractor a written notice (x) specifying that any affected area is or has been rendered suitable for the resumption of Work in compliance with Applicable Law or (y) specifying any special conditions under which such Work may be resumed in compliance with Applicable Law. To the extent that any such suspension adversely affects Contractor’s or its Subcontractors’ or Sub-subcontractors’ cost or time for performance of the Work in accordance with the requirements of this Agreement, Contractor shall be entitled to an appropriate Change Order pursuant to Section 6.2A.11.
3.18Quality Assurance. No later than ninety (90) Days after the date Owner issues LNTP No. 1, Contractor shall submit to Owner for its review and approval, not to be unreasonably withheld, a Stage 3 Facility-specific quality control and quality assurance plan and an inspection plan detailing Contractor’s quality plan (“Quality Plan”) as required by Attachment Y. No later than ninety (90) Days after the date Owner issues LNTP No. 1, Contractor shall submit to Owner for its approval, not to be unreasonably withheld, detailed construction inspection and test plans and supporting construction procedures as required by Attachment Y. Prior to the commencement of the Work, detailed quality assurance and quality control procedures and plans applicable to that portion of the Work shall be issued to Owner in accordance with Attachment Y. Owner’s review and approval of Contractor’s Quality Plan, detailed construction inspection and test plans and supporting construction procedures, and detailed quality assurance and quality control procedures and plans shall in no way relieve Contractor of its responsibility for performing the Work in compliance with this Agreement. As part of such plans, Contractor agrees that it shall keep a daily record of inspections performed, and Contractor shall make available at the Site for Owner’s and Lender’s (including Independent Engineer) review a copy of all such inspections.
3.19Reports and Meetings.
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A.Reports. Contractor shall provide Owner with one (1) electronic copy of the following reports and such other information required in this Agreement:
1.minutes for all weekly status and Project-related meetings with Owner within five (5) Business Days following such meeting;
2.safety or environmental incident reports in accordance with Attachment J (including significant “near miss” incidents where no individual was injured or property was damaged), except for any safety or environmental incident involving a significant non-scheduled event such as LNG or Natural Gas releases, fires, explosions, mechanical failures, unusual over-pressurizations or major injuries which shall be provided to Owner within eight (8) hours of the occurrence of such incident; provided, however, notification shall be provided to Owner immediately if any safety or environmental incident threatens public or employee safety, causes significant property damage, or interrupts the Work;
3.weekly (or such longer duration as otherwise agreed by Owner in writing) progress reports (“Weekly Progress Reports”), in a form reasonably acceptable to Owner and containing the information required in Attachment X, which shall be provided one (1) Day prior to the weekly progress meeting and shall cover all activities up to the end of the previous week; and
4.Monthly progress reports, in a form reasonably acceptable to Owner and containing the information required in Attachment X (“Monthly Progress Reports”). Contractor shall provide the Monthly Progress Report no later than ten (10) Business Days after the end of each Month covering activities up through the end of the previous Month. On a Quarterly basis, the Monthly Progress Report shall contain the additional information required in Attachment X. Contractor shall arrange for the electronic distribution thereof as Owner may reasonably request.
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B.Meetings.
1.A weekly progress meeting with Owner shall occur every week, on a weekday to be agreed to by the Parties, at the Site, or at an alternate site agreeable to the Parties, to discuss the matters described in Attachment X for the prior week. The meetings shall be attended by Contractor and those Contractor employees reasonably requested by Owner.
2.Each Quarter the Monthly Progress Report will be replaced with a quarterly progress report (the “Quarterly Progress Report”), which shall be reviewed at the weekly progress meeting immediately succeeding the end of the applicable Quarter. At such weekly progress meeting, the Parties shall discuss the matters described in Attachment X for the prior Quarter and review the Quarterly Progress Report for that Quarter with Owner.
3.20Payment. Contractor shall timely make all payments required to be paid to Owner pursuant to the terms of this Agreement.
3.21Commercial Activities. Neither Contractor nor its employees shall establish any commercial activity or issue concessions or permits of any kind to third parties for establishing commercial activities on the Land or any other lands owned or controlled by Owner; provided, however, temporary lunch wagons and vending machines may be permitted upon prior approval by Owner, not to be unreasonably withheld.
3.22Title to Materials Found. As between Owner and Contractor, the title to water, soil, rock, gravel, sand, minerals, timber, and any other materials developed or obtained in the excavation or other operations of Contractor, any Subcontractor, or any Sub-subcontractor at the Site, and the right to use said materials or dispose of same, is hereby expressly reserved by Owner. Contractor may, provided that Contractor has received Owner’s approval, be permitted, without charge, to use in the Work any such materials that comply with the requirements of this Agreement. Owner hereby approves Contractor’s right to use the following, but Owner makes no warranty or representation regarding the adequacy or sufficiency of same: spoils (cut) from the Train 1, Train 2 or Train 3 areas as fill for the Train 4, Train 5, Train 6, Train 7, OSBL and flare areas, and stabilized soil from the sump/impoundment excavations. Notwithstanding the above, Contractor shall remain liable for, at its sole cost and expense, the disposal of all materials developed or obtained in the excavation or other operations of Contractor, any Subcontractor or Sub-subcontractor (excluding Pre-Existing Contamination, Arsenic and Unforeseen Subsurface Conditions).
3.23Survey Control Points and Layout. Contractor shall establish all survey control points and layout the entire Work in accordance with the requirements of this Agreement, which shall be based on the survey control point established by Owner pursuant to Section 4.5. Contractor acknowledges that, prior to commencement of the Work, it has independently confirmed with a surveyor, licensed in the state of Texas, the proper placement of such survey control points. If Contractor or any of its Subcontractors, Sub-subcontractors or any of the representatives or employees of any of them move or destroy or render inaccurate the survey control point provided by Owner, such control point shall be replaced by Contractor at Contractor’s own expense.
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3.24Cooperation with Others.
A.Cooperation Within the Site. Subject to the provisions of this Agreement, including Section 4.3, Contractor acknowledges that Owner, its consultants and professionals described in Section 2.5D and other contractors and other subcontractors or other Persons may be working at the Site during the performance of this Agreement. Owner shall provide Contractor with reasonable notice of any request for access to the Site by (i) any of Owner’s other contractors or subcontractors seeking to perform work at the Site (except with respect to Contractor’s work performed under the Stage 1 EPC Agreement or the Stage 2 EPC Agreement) or (ii) any other entity acting on behalf of Owner or the Site’s landowner. Subject to Section 4.3, Contractor agrees to use reasonable efforts to accommodate such request and to coordinate the performance of the Work with those certain activities to be performed by Owner’s other contractors or subcontractors or such other Persons so as not to materially interfere with the performance of such activities at the Site. Owner shall require that such consultants and professionals described in Section 2.5D and other contractors and subcontractors or entities working at the Site during the performance of this Agreement prior to Substantial Completion of each Train, at all times while on the Site comply with Contractor’s safety program approved by Owner pursuant to Section 3.10 that is applicable to the Site. To minimize interference with the work of any other parties, Contractor and its Subcontractors and Sub-subcontractors shall not, unless permitted by Owner in writing, perform the Work outside the Site and Supporting Real Estate as described in Attachment Z.
B.Cooperation Within the Supporting Real Estate. Owner shall provide Contractor with reasonable prior notice of access to the Supporting Real Estate by any of Owner’s other contractors or subcontractors seeking to perform work within such Supporting Real Estate. Likewise, Contractor shall provide Owner with reasonable prior notice of any access to the Supporting Real Estate by Contractor or any of its Subcontractors or Sub-subcontractors. Owner hereby notifies Contractor that Affiliates of Owner Group will need access to the Supporting Real Estate. Contractor hereby acknowledges such notice and agrees that no further notices are required in connection with any Affiliates of Owner Group accessing the Supporting Real Estate. Subject to the provisions of this Agreement, including Section 4.3, Contractor acknowledges that Owner or Owner’s other contractors or subcontractors may be working within the Supporting Real Estate and that other Persons (including any Landowner) may be on or using the Supporting Real Estate during the performance of this Agreement and Contractor’s Work or use of certain facilities may be interfered with as a result of such concurrent activities. Subject to Section 4.3, Contractor agrees to use reasonable efforts to coordinate the performance of the Work with such other contractors or subcontractors performing work within the Supporting Real Estate so as not to materially interfere with any of Owner’s other contractors or subcontractors performing work within the Supporting Real Estate; provided, however, Contractor shall in all cases coordinate the Work with any Persons (other than Owner or Owner’s other contractors or subcontractors) on or using the Supporting Real Estate pursuant to Attachment Z. All coordination required of Contractor in this Section 3.24B with other Persons shall be done through Owner.
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3.25Responsibility for Property. Contractor shall plan and conduct its operations so that neither Contractor nor any of its Subcontractors or Sub-subcontractors shall (a) enter upon private lands (other than the Land) or waterbodies in their natural state unless authorized by the owners of such lands; (b) enter any restricted areas set forth in Attachment Z; (c) close or obstruct any utility installation, highway, waterway, harbor, road or other such property unless and until applicable Permits have been obtained and, to the extent such items are located on the Site, Owner’s permission has been obtained; (d) disrupt or otherwise interfere with the operation of any portion of any pipeline, telephone, ship or barge operation, dredging activities, conduit or electric transmission line, railroad, ditch, navigational aid, dock or other similar structure unless otherwise specifically authorized by (i) Owner in writing or (ii) the appropriate entity or authority, or otherwise provided in Attachment Z; (e) damage any property listed in (c) or (d); and (f) damage or destroy maintained, cultivated or planted areas or vegetation such as trees, plants, shrubs, shore protection, paving, or grass adjacent to the Site. The foregoing includes damage arising from performance of the Work through operation of Construction Equipment or stockpiling of materials. Contractor shall be responsible for all damages, costs, losses and expenses arising out of non-compliance with this Section 3.25 (in accordance with the indemnification and defense obligations set forth in Article 17) and shall, as soon as reasonably possible, restore at its own cost and expense such property to the condition it was in before such damage. Contractor and its Subcontractors and Sub-subcontractors shall coordinate and conduct the performance of the Work so as to not unreasonably interfere with or disrupt the use and peaceful enjoyment of any adjacent property to the Site.
3.26Explosives. Explosives shall not be transported to the Land without Owner’s prior approval. In the event that Contractor receives such approval, explosives shall be transported to the Land only when required to perform the Work under this Agreement and with at least thirty (30) Days’ prior notice to and approval of Owner. Contractor shall be responsible for properly purchasing, transporting, storing, safeguarding, handling and using explosives required to perform the Work under this Agreement. Contractor shall employ competent and qualified personnel for the use of explosives. Residual surplus explosives shall be promptly removed from the Site and properly disposed of by Contractor. Contractor shall comply with Applicable Law and Applicable Codes and Standards in the handling of explosives pursuant to this Agreement (including the U.S. Patriot Act of 2001 and any and all rules and regulations promulgated by the U.S. Department of Homeland Security and the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives), shall perform all obligations and obtain all Permits with respect to explosives, and shall develop and file and provide copies to Owner of all documentation regarding same.
3.27Interference and Integration.
A.No Interference with the CCL Liquefaction Facility, or a Train after Substantial Completion of such Train. Contractor understands that (i) various components of the CCL Liquefaction Facility will be under construction, commissioning, testing, and full operation during the performance of the Work, and (ii) upon Substantial Completion of a Train, such Train will be under full commercial operation during the performance of the Work. Performance of the Work or any portion thereof, and any other obligations of Contractor under this Agreement, shall at no time cause a suspension of operation of the CCL Liquefaction Facility or with the operation of a Train after Substantial Completion of such Train, except (i) to the extent specified in Attachment EE and in compliance with the requirements of Section 3.27B or (b) agreed by the Owner Representative in writing.
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B. Scheduled Activities. No later than thirty (30) Days prior to performing any Work that has the potential to interfere with the CCL Liquefaction Facility or a Train after Substantial Completion of such Train, as described in Section 3.27A, Contractor shall notify Owner in writing that Contractor plans to perform such scheduled, interfering Work. No later than thirty (30) Days prior to performing any Work that has the potential to interfere with the operation of the CCL Liquefaction Facility or a Train after Substantial Completion of such Train, as described in Section 3.27A, Contractor shall provide Owner with a written integration plan listing the scheduled, interfering Work and proposing in detail how Contractor intends that such Work will be performed to minimize, to the greatest extent reasonably possible, any such interference. Such proposed plan shall (i) comply with the requirements of Section 3.27A; (ii) be scheduled so that it is not on the critical path; (iii) include attention to safe work practices to ensure safety and reliability of the operating facilities and the safety of the construction and operational personnel; and (iv) list (a) the component of the CCL Liquefaction Facility or a Train after Substantial Completion of such Train that will be impacted by such activity, (b) how such component or work will be impacted, and (c) the duration of such impact. If the plan proposed by Contractor does not meet any of the requirements in the immediately preceding sentence, does not meet all of the requirements specified in Attachment EE, or if Owner reasonably believes that the plan proposed by Contractor has not been developed to reasonably minimize the impact on the CCL Liquefaction Facility or a Train after Substantial Completion of such Train as described in Section 3.27A, then Owner may, no later than fourteen (14) Days following receipt of the proposed plan, instruct Contractor in writing to modify the proposed plan and Contractor shall modify such plan to meet such Owner’s instructions, provided that such instruction may not require Contractor to comply with any requirements in addition to those specified in subsections (i)-(iv) above of this Section 3.27B or in Attachment EE or any requirements made by Owner that are based on Owner’s reasonable belief that the plan proposed by Contractor has not been developed to reasonably minimize the impact on the CCL Liquefaction Facility or a Train after Substantial Completion of such Train as described in Section 3.27A. After Owner and Contractor reach agreement on such plan, Contractor shall proceed to execute such Work in accordance with such modified plan; provided that, if Owner does not respond and comment upon the Contractor’s proposed plan within fourteen (14) Days following receipt of Contractor’s proposed plan, then Contractor shall proceed to execute such Work in accordance with Contractor’s proposed plan as long as it complies with the limitations specified in this Section 3.27B(i)-(iv), Attachment EE and any requirements made by Owner that are based on Owner’s reasonable belief that the plan proposed by Contractor has not been developed to reasonably minimize the impact on the CCL Liquefaction Facility or a Train after Substantial Completion of such Train as described in Section 3.27A. If the Parties cannot agree on such plan, then the Dispute shall be resolved as provided in Article 18. Notwithstanding Owner’s agreement (or failure to agree) to the schedule and the plan for the performance of such Work, if Owner fails to comply with such plan that is agreed upon by Owner or resolved pursuant to Article 18 or Owner, in its sole discretion, subsequently prohibits the performance of such Work occurring on the scheduled date in accordance with the plan agreed upon by Owner or resolved pursuant to Article 18, in either such case, Contractor shall be entitled to a Change Order to the extent permitted under Section 6.8. If Owner fails to provide Contractor with access when and for the duration required by Contractor for the Work, other than for non-compliance with Section 3.27B(i)-(iv), Attachment EE and any requirements made by Owner that are based on Owner’s
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reasonable belief that the plan proposed by Contractor has not been developed to reasonably minimize the impact on the CCL Liquefaction Facility or a Train after Substantial Completion of such Train as described in Section 3.27A, Applicable Law, Owner Permits relating to safety, or Owner’s reasonable security requirements, then, Contractor shall be entitled to a Change Order to the extent permitted under Section 6.8.
C.Unscheduled Activities. It is the Parties’ intent that except for the activities listed in Attachment EE, the performance of the Work and Contractor’s other obligations under this Agreement will not interfere with the CCL Liquefaction Facility or a Train after Substantial Completion of such Train, as described in Section 3.27A. During the performance of the Work, should a situation arise that Contractor reasonably believes has the potential to interfere with the CCL Liquefaction Facility or a Train after Substantial Completion of such Train as described in Section 3.27A and such situation was not addressed pursuant to Section 3.27B, Contractor shall, except in an emergency endangering property or any Persons, give Owner written notice as soon as possible but no later than fourteen (14) Days prior to the time that Contractor plans to perform such Work, detailing a plan that is least disruptive, to the greatest extent reasonably possible, to activities occurring at the CCL Liquefaction Facility or a Train after Substantial Completion of such Train. Emergency actions are governed by Section 3.11. Prior to performing such Work, Owner and Contractor shall mutually agree on a proposed plan for Contractor to execute such Work; provided that, if Owner fails to provide Contractor with access when and for the duration required by Contractor for the Work, other than for non-compliance with Section 3.27B(i)-(iv) or a failure to reasonably minimize the impact on the CCL Liquefaction Facility or a Train after Substantial Completion of such Train, then Contractor shall be entitled to a Change Order to the extent permitted under Section 6.8. Notwithstanding Owner’s agreement to the schedule and the plan for the performance of such Work, Owner may, in its sole discretion, subsequently prohibit the performance of such Work on such scheduled date, and Contractor shall work with Owner to develop a new plan and date for performing such Work in accordance with this Section 3.27C, and in such case Contractor shall be entitled to a Change Order to the extent permitted under Section 6.8.
3.28Equipment Not Incorporated into the Stage 3 Facility. If, after Substantial Completion for Train 3 and prior to Final Completion, Contractor has any Equipment that it purchased for the Stage 3 Facility but did not incorporate into the Stage 3 Facility, Owner has the option of either (a) purchasing such Equipment at fair market value, plus applicable sales tax (unless an applicable exemption or direct payment permit exemption certificate is provided to Contractor), and customs and import duties if the item was intended for re-export, or (b) requiring that Contractor haul off such Equipment at Contractor’s own cost and expense (and if Contractor is required to haul off such Equipment, Owner shall transfer title to such Equipment to Contractor); provided that, if such Equipment was purchased on a basis other than a lump sum basis (such as on a time and material basis under a Change Order), then if Owner elects to take such Equipment, it may take such Equipment at no cost to Owner, and title to such Equipment shall remain with Owner in accordance with Section 8.1B.
3.29Operation Personnel.
A.Until Substantial Completion of the applicable Train, Owner’s operating personnel designated in Section 4.4 shall be under the control of and supervised by Contractor,
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and Contractor shall (subject to Owner’s indemnification obligations under Section 17.3) be fully responsible for the acts and omissions of such personnel; provided, however, notwithstanding the foregoing, such operating and maintenance personnel shall remain employees or agents of Owner and shall not be considered employees of Contractor for any reason.
B.Contractor shall, no later than one hundred eighty (180) Days prior to RFSU, prepare for Owner’s review a proposed plan regarding the utilization of Owner’s operation personnel and Contractor’s personnel during commissioning and for the conduct of Performance Tests and any other tests. Each such plan shall be prepared to avoid any impact on the operation of a Train after Substantial Completion and to take into account Owner’s operating and maintenance procedures, the number of operating and maintenance personnel available to Owner for participation in pre-commissioning, commissioning, start-up and Performance Testing, safety issues for the Train and the type of activities to be performed. Such plan shall be mutually agreed-upon by the Parties in writing no later than forty-five (45) Days after Owner’s receipt of Contractor’s proposed plan. Nothing in this Agreement, including this Section 3.29 or Section 3.2H, shall be interpreted to create a master-servant or principal-agent relationship between Contractor and any of Owner’s operation or maintenance personnel.
3.30Compliance with Real Property Interests. Contractor shall, in the performance of the Work, comply, and cause all Subcontractors and Sub-subcontractors to comply, with any easement, lease, right-of-way, licenses or other property interests that are clearly delineated in Attachment Z and affect or govern the Site or any other real property used for the purposes of completing the Work.
3.31Taxes. Subject to Section 7.1 and Section 6.2A.7, the Contract Price includes all Taxes imposed on or payable by Contractor, its Subcontractors and Sub-subcontractors in connection with the Work, except that Contractor is not responsible for property taxes assessed on Equipment at the Site. Contractor shall be responsible for the payment of all Taxes imposed on or payable by Contractor, its Subcontractors and Sub-subcontractors in connection with the Work, except for property taxes assessed on Equipment at the Site.
3.32Electronic File Sharing Site. Within ten (10) Days after the Agreement Date and until the expiration of the Defect Correction Period, Contractor shall create and maintain an electronic file sharing site that can be accessible by Owner, Owner’s Affiliates, Lenders, Independent Engineer and any other Persons designated by Owner, and their respective employees, officers and directors (using their own or their respective company’s computers or electronic devices). Such electronic file share site shall be subject to approval by Owner, not to be unreasonably withheld. Contractor shall upload, onto such electronic file sharing site all Work Product, reports, schedules, Drawings, Specifications and project specific policies and procedures (other than Invoices or Change Orders or any other commercial information) contemporaneously with, or immediately after, such document, data and information was submitted to Owner. Such electronic file sharing site shall not be a substitute for the submission of documents to Owner as required herein, but instead shall serve as an additional service provided to Owner enabling Owner, Owner’s Affiliates, Lenders, Independent Engineer and any other Persons designated by Owner to have another source of access to such documents, data and information.
ARTICLE 4
OWNER’S RESPONSIBILITIES
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Owner shall comply with the following provisions in a timely manner:
4.1Payment. Owner shall timely pay the Contract Price in accordance with the provisions of Article 7 hereof.
4.2Permits. Owner shall be responsible for obtaining and thereafter maintaining the Owner Permits for the duration necessary for the performance of the Work, including, if and to the extent applicable, throughout the applicable Defect Correction Periods. To the extent Owner has not obtained any Permits listed in Attachment Q prior to NTP, Owner shall obtain such Permits in accordance with the schedule contained in Attachment Q and Owner shall provide Contractor with copies of such Permits within five (5) Business Days after obtaining them.
4.3Access to the Site, Supporting Real Estate and CCL Liquefaction Facility Site.
A.Site. Owner shall provide Contractor with access to the Site to the extent necessary to perform any LNTP Work and, in any event, upon issuance of NTP. Subject to Sections 3.24 and 3.25, such access shall be sufficient to permit Contractor to progress with construction on a continuous basis without material interruption or interference.
B.Supporting Real Estate. Subject to Sections 3.24 and 3.25, Owner shall provide Contractor with the right to enter those portions of the Supporting Real Estate to the extent such access is provided for in Owner’s written agreement with the owner of such Supporting Real Estate as provided in Attachment Z.
C.CCL Liquefaction Facility Site. Subject to Sections 3.24, 3.25, and 3.27, Owner shall provide Contractor with reasonable access on the CCL Liquefaction Facility Site to perform the CCL Liquefaction Facility Tie-In Work required by this Agreement. To the extent Contractor is not provided with access as described in this Section 4.3, and such lack of access adversely impacts Contractor’s or its Subcontractors’ or Sub-subcontractors’ cost or time for performance of the Work in accordance with the requirements of this Agreement, Contractor shall be entitled to a Change Order; provided that (i) Contractor complies with the notice and Change Order request requirements set forth in Sections 6.2 and 6.5, and (ii) at or prior to the Agreement Date, Contractor did not know (based on information set forth in Attachment Z and Attachment EE) that its access was or would be restricted.
D.Foreign Trade Zone. Owner shall comply with its obligations in Attachment LL.
4.4Operation Personnel. Owner shall retain competent and qualified operating personnel (who are capable of being trained by Contractor) to assist Contractor with the commissioning and start-up of the Stage 3 Facility under the supervision of Contractor and to operate the Stage 3 Facility prior to Substantial Completion of each Train under the supervision of Contractor as set forth in Attachment A and Attachment M (Owner’s “operation personnel”). Until Substantial Completion of the applicable Train, such personnel shall be under the control of and supervised by Contractor in accordance with Section 3.29, subject to Owner’s indemnity obligations in Section 17.3.
4.5Legal Description and Survey. Owner has provided to Contractor for Contractor’s information a survey of the Land showing the boundaries of the Land and a minimum of one (1) survey
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control point, the proper placement of which Contractor has confirmed as set forth in Section 3.23. Such survey contains metes and bounds of the Site. Contractor shall be entitled to rely upon the accuracy of such metes and bounds description of the Site. To the extent any existing structures or utilities are shown in the survey, Contractor shall independently verify the location of such structures and utilities.
4.6Owner-Furnished Items.
A.Rely Upon Information. Contractor shall be entitled to rely upon the accuracy of the Rely Upon Information furnished or referenced by Owner in Attachment BB. Should (i) Contractor discover an inaccuracy or an error in such information, (ii) Owner change the Rely Upon information in any way or (iii) such information not comply with Applicable Law or Applicable Codes and Standards, Contractor shall be entitled to a Change Order to the extent permitted under Sections 6.2A.9 and 6.8.
B.Owner-Furnished Items. Owner shall, at no cost to Contractor, provide the items listed in Attachment V (“Owner-Furnished Items”) within the times and at the locations set forth therein, subject to the conditions specified therein.
C.Natural Gas Feed to Achieve Substantial Completion. As between Owner and Contractor under this Agreement and subject to Section 4.6D, Owner shall procure and make Natural Gas feed available at no cost to Contractor for the pre-commissioning, commissioning, start-up, cool down and testing of each Train (including Natural Gas utilized in the initial cool-down) and as otherwise required for Contractor to achieve Substantial Completion of each Train, subject to the conditions in Attachment V. The Natural Gas feed to each Train will meet the pressure, temperature and quality requirements set forth in Schedule A-2. Such Natural Gas feed shall be made available by (or on behalf of) Owner at the delivery point provided by Owner. Contractor shall use GECP to minimize the amount of Natural Gas flaring or venting (and at all times complying with any restrictions required under Applicable Law) that is necessary to achieve Substantial Completion of each Train, and the commissioning, start-up and testing procedures agreed upon by the Parties shall be developed and administered in a manner to minimize Natural Gas flaring and venting.
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D.Natural Gas Feed Delivery.
1.In connection with each Train, Contractor shall give its best estimate of when Natural Gas feed is required to produce the LNG necessary to achieve RFSU of such Train, and such estimate shall be given in a written notice from Contractor to Owner, as set forth below. Such notice shall include the quantities of Natural Gas feed needed, including a range of Days and range of flows for each Day.
2.For all other circumstances that Contractor may require Natural Gas feed up to the achievement of Substantial Completion of a Train, Contractor shall provide Owner:
(i)written notice at least sixty (60) Days prior to Contractor needing its first deliveries of Natural Gas feed including a range of Days and a range of flows for each Day which Contractor, using GECP, believes it will need for delivery of Natural Gas feed; and
(ii)a second written notice at least thirty (30) Days prior to Contractor needing its first deliveries of Natural Gas feed, with an updated forecast of the Days and amounts of Natural Gas feed deliveries (within the ranges provided by Contractor in its initial notice delivered pursuant to Section 4.6D2(i)).
E.LNG Storage Tanks. Based upon Contractor’s estimate of Natural Gas FEED submitted to Owner pursuant to Section 4.6D, Owner shall ensure a reasonable volume is available in the LNG storage tanks (to the extent such volume is necessary for Contractor to achieve Substantial Completion of each Train) for the commissioning and testing of each Train.
F.Electrical Power. Owner shall procure and make permanent electric power available for the operation of such Train in accordance with Attachment V.
4.7Owner Representative. Owner designates *** as the Owner Representative. Notification of a change in Owner Representative shall be provided in advance, in writing, to Contractor.
4.8Texas Sales and Use Tax.
A.Sales and Use Tax Exemption Certificate on Equipment.
1.For Texas Sales and Use Tax purposes, this Agreement shall be considered to be a separated contract for the construction of new non-residential real property as defined under Applicable Law, including 34 Tex. Admin Code Rule § 3.291(a)(13). Contractor shall ensure that all Subcontracts are separated for Texas Sales and Use Tax purposes.
2.The associated portion of the Contract Price attributable to each piece of Equipment is set forth in Attachment CC, which has been prepared to satisfy the requirements of Applicable Law of Texas for a separated contract. Contractor shall, with
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respect to any Change Order entered into between Owner and Contractor that results in an update to Attachment CC, provide such update to Owner for its review as part of the documentation required in Article 6.
3.Prior to issuance of NTP or any LNTP directing Contractor to procure any Equipment, and to the extent not already included in Attachment DD, Owner shall issue a Texas direct pay exemption certificate to Contractor, and Contractor shall not invoice Owner for any Texas Sales and Use Tax on Equipment. Pursuant to direct pay permit status, Owner shall pay applicable Texas Sales and Use Tax on Equipment directly to the State of Texas. Contractor shall provide the documents and information necessary to allow the Owner to properly determine this tax liability. Contractor shall maintain for Owner’s review copies of exemption certificates and other similar documentation necessary to support all Texas Sales and Use Tax exemptions that may be available to Owner, Contractor or any Subcontractor or Sub-subcontractor in connection with the Work.
B.Additional Contractor Texas Sales and Use Tax Responsibilities. For Texas Sales and Use Tax purposes, Contractor shall be considered a retailer of all Equipment incorporated into the Work. Contractor shall issue a valid Texas Sales and Use Tax resale exemption certificate for such Equipment to its Subcontractors, and Contractor shall not pay, consistent with such exemption certificate, any sales and use tax on such Equipment to Subcontractors.
4.9Hazardous Materials. Owner has disclosed to Contractor all material reports, studies and written Governmental Instrumentality documentation in Owner’s and its Affiliates’ possession regarding the location, character, scope and extent of Arsenic. Owner acknowledges that none of Contractor or its Subcontractors or Sub-subcontractors have created or contributed to the creation or existence of the identified Arsenic. Owner shall, or shall cause its Affiliates to, as applicable in Owner’s reasonable determination and at the sole cost, expense and liability of Owner (except for those costs, damages, losses and expenses for which Contractor is responsible under Sections 3.6 or 3.17), identify, characterize, manage, manifest, treat, store, remediate, remove, transport, or dispose of any Pre-Existing Contamination and any Arsenic encountered by Contractor on the Land. Owner shall be identified as the “generator” of any Pre-Existing Contamination and Arsenic requiring off-Site transportation and/or disposal, shall select the treatment or disposal facility to which any such Hazardous Materials or Arsenic are sent, and shall make all arrangements for the placement of any such Hazardous Materials in appropriate containers and their transfer to any contractors for off-Site transportation and/or disposal, and, without limitation of Owner’s obligations set forth in Section 17.4, shall save, indemnify, defend and hold harmless Contractor Group from any liabilities for costs, damages, losses and expenses (including any fines, penalties or other sanctions imposed by any Governmental Instrumentality (including the cost of required remedial measures)) brought by third parties arising from Owner’s response or failure to respond to Pre-Existing Contamination or Arsenic.
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4.10Insurance. Owner shall timely provide and maintain all insurance coverages required to be provided by Owner as set forth in Attachment O.
ARTICLE 5
COMMENCEMENT OF WORK, GUARANTEED DATES, AND SCHEDULING OBLIGATIONS
5.1Limited Notice to Proceed
A.Limited Notice to Proceed.
1.Commencement of LNTP Work. Upon Contractor’s receipt from Owner of LNTP No. 1 or any other limited notice to proceed executed pursuant to Section 5.1A3 (individually or collectively, “Limited Notice to Proceed” or “LNTP”), Contractor shall promptly commence with the performance of the portion of the Work specified in such LNTP. The LNTP shall be issued in the applicable form attached hereto in Attachment H, as further described below. If permitted to be filed under Applicable Law, Contractor shall timely file an affidavit of commencement of construction with the county clerk pursuant to Texas Property Code § 53.124(c). Contractor shall not, and shall not be obligated to, commence performance of such Work until receipt from Owner of such LNTP.
2.LNTP No. 1. Owner shall issue LNTP No. 1 in the form attached hereto as Schedule H-3 (“LNTP No. 1”), authorizing and requiring Contractor to commence performance of the Work as described in Schedule H-3. All Work performed under LNTP No. 1 shall be performed in accordance with the terms and conditions of this Agreement, and all payment for Work under LNTP No. 1 shall be credited against the Contract Price and the first payments to become due hereunder if NTP is issued. The portion of the Contract Price payable for Work under LNTP No. 1 shall be made in accordance with the Payment Schedule set forth in Schedule H-3 (as may be amended by Change Order) and the applicable provisions of Article 7. For the avoidance of doubt, in the event LNTP No. 1 is not issued by Owner pursuant to this Agreement, the Work included in Schedule H-3 remains part of the Work required to be performed by Contractor after NTP pursuant to this Agreement.
3.LNTPs Generally. At any time prior to the date of issuance of NTP, Owner may issue other LNTPs which, if issued, shall authorize and require Contractor to commence performance of a specified portion of the Work; provided that the Parties have executed a Change Order for such other LNTP Work. Each other LNTP, if any, shall specify the Work to be performed under the LNTP and the cost of such specified Work, and Contractor shall be paid for such specified Work pursuant to the terms and conditions of such other LNTP and this Agreement, with all such payments credited against the Contract Price if NTP is issued. Such LNTP shall be issued in the form attached hereto as Schedule H-2. The portion of the Contract Price payable for the LNTP Work shall be made in accordance with the Payment Schedule set forth in Attachment C (as may be
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amended by the applicable LNTP or by Change Order) and the applicable provisions of Article 7.
B.Conditions of Issuance of LNTP. Owner shall not issue any LNTP (including LNTP No. 1) until the following conditions have been met (or waived in writing by Contractor):
1.Owner has obtained all Owner Permits that are necessary for performance of the LNTP Work, or if Owner has not obtained all such Owner Permits at the commencement of such LNTP Work, by issuance of the LNTP, Owner commits to obtain any such remaining Owner Permits in such time so as to not delay the performance of such LNTP Work;
2.Owner shall be in compliance with its other obligations set forth in Article 4 as necessary for the performance of the LNTP Work;
3.Owner has delivered to Contractor (A) a release, acceptable to Contractor, from Cheniere Land Holdings LLC (“CLH”) releasing Contractor Group and its Subcontractors and Sub-subcontractors: (1) from and against all damages, losses, costs and expenses (including all reasonable attorneys' fees, and litigation or arbitration expenses) resulting from or related to Arsenic and Pre-Existing Contamination and (2) Consequential Damages for which Contractor is released under Section 20.4 and arising out of or relating to such Arsenic and Pre-Existing Contamination and (B) a commitment, acceptable from Contractor, from CLH that the obligations and requirements in Sections 3.17, 4.9, 17.3D and 17.4 apply equally to CLH. Such release and commitment shall be binding on and extend to any Affiliate of Owner or CLH that takes equity ownership in the Site. Notwithstanding the foregoing, this condition of LNTP No. 1 is not required if before LNTP No. 1 CLH has transferred ownership of the Site to Owner and this release and commitment will be void and of no further force or effect if at any time after issuance of LNTP No. 1 Owner becomes the owner of the Site; and
4.If Owner fails to issue LNTP No. 1 on or before March 1, 2022, the Parties have agreed to the adjustments to the Contract Price and Guaranteed Substantial Completion Dates as provided in Section 5.2C below as a condition of Owner issuance LNTP No. 1 after March 1, 2022.
5.2Notice to Proceed.
A.Contractor shall not, and shall not be obligated to, commence performance of any of the Work (other than any LNTP Work) until Owner issues NTP authorizing the same pursuant to the terms and conditions of this Agreement. Upon Contractor’s receipt from Owner of NTP, Contractor shall promptly commence with the performance of the Work. NTP shall be issued in the form attached hereto as Schedule H-1. If it has not already done so, Contractor shall timely file an affidavit of commencement of construction with the county clerk pursuant to Texas Property Code § 53.124(c).
B.Owner shall not issue NTP until the following conditions precedent have been fulfilled by Owner or waived in writing by Contractor:
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1.Owner has furnished Contractor with reasonable documentation demonstrating that Owner has sufficient funds to fulfill its payment obligations under this Agreement as payments become due hereunder, (a) through itself, its parent or Affiliate(s) and/or (b) through firm commitments from Lenders to Owner or its parent or Affiliates, including, (i) only to the extent required by Lenders, evidence of the equity commitments required for such financing, (ii) evidence of satisfaction, or waiver by Lenders, of all applicable conditions precedent to the occurrence of the closing date of the financing, which shall be prior to or contemporaneous with the issuance of the Notice to Proceed, and which may be in the form of an email from Lender’s counsel so specifying such satisfaction or waiver, and (iii) a draft copy of such credit agreement or credit agreements to be provided prior to NTP and an executed copy of such credit agreement or credit agreements to be provided promptly after NTP. For purposes of this Section 5.2B1, funds “sufficient to fulfill Owner’s payment obligations” shall mean a total amount equal to the Contract Price less Mobilization Payment, available in accordance with the payment schedule shown in Attachment C. Such funds shall be in addition to and exclusive of (x) the Mobilization Payment and (y) any funds remaining to be paid by Owner under the Stage 1 EPC Agreement and the Stage 2 EPC Agreement.
2.Owner has provided, or is able to provide, Contractor with access on the Site in accordance with Section 4.3 and Owner is in compliance with its other obligations set forth in Article 4 as necessary for the commencement of the Work;
3.The Mobilization Payment has been received by Contractor in cleared funds;
4.Owner has obtained all Owner Permits which are shown in Attachment Q as required to be obtained prior to the issuance of the NTP;
5.Owner has made payment to Contractor of all undisputed amounts due and owing as of the date of NTP that were invoiced in connection with Contractor’s performance of the LNTP Work;
6.Contractor’s performance of Work under LNTP No. 1 and LNTP No. 2, if such LNTPs were issued prior to the issuance of NTP, has not been cancelled or suspended by Owner; and
7.If Owner fails to issue NTP on or before July 1, 2022 and Owner has not issued LNTP No. 1 on or before March 1, 2022, the Parties have agreed to the adjustments to the Contract Price and Guaranteed Substantial Completion Dates as provided in Section 5.2C below.
C.Delayed LNTP or NTP. In the event Owner fails to: (i) issue LNTP No. 1 in accordance with Section 5.1 on or before March 1, 2022 or (ii) issue NTP in accordance with Section 5.2 on or before July 1, 2022 despite Owner having issued LNTP No. 1 in accordance with Section 5.1 on or before March 1, 2022, then Contractor shall be entitled to an adjustment to the Contract Price and the Guaranteed Substantial Completion Dates if and to the extent caused by such delayed issuance of LNTP No. 1 or NTP, as applicable. Such adjustment shall include
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cost and schedule impacts caused by, for example, closing of vendor shops, unavailability of or delay in availability of materials (including any delays due to any quotas), labor unavailability, impacts on ability to attract and/or retain qualified labor, as well as escalation and loss of synergies with Contractor’s work under the Stage 2 EPC Agreement. For the avoidance of doubt, any adjustment to the Contract Price or Guaranteed Substantial Completion Dates shall not be based on Contractor’s errors or omissions, a change in technology, or a change in material or Equipment quantities (except where the unavailability of materials, vendors or labor caused by such delayed issuance of LNTP No. 1 or NTP results in necessary changes to Equipment specifications). Contractor shall use commercially reasonable efforts and GECP to mitigate the increase to the Contract Price and the Guaranteed Substantial Completion Dates. Such agreed upon adjustment will be set forth in a Change Order. Contractor shall, at the end of every three (3) Month period thereafter until NTP (if any) is issued by Owner, notify Owner in writing of any impacts such delay has on Contractor’s costs of performance of the Work, including Subcontractor and Sub-subcontractor prices, and Contractor’s ability to perform the Work in accordance with the Agreement, including the Guaranteed Substantial Completion Dates. Contractor shall not be entitled to the relief in this Section 5.2C to the extent the reason for Owner failing to issue NTP is because Contractor failed to provide the Letter of Credit in accordance with Section 9.2A.
5.3Guaranteed Dates.
A.Guaranteed Substantial Completion Dates. Subject to Section 5.2C,
1.Contractor shall achieve Substantial Completion of Train 1 on or before *** (***) Days after issuance of LNTP No. 1 (“Guaranteed Train 1 Substantial Completion Date”);
2.Contractor shall achieve Substantial Completion of Train 2 on or before *** (***) Days after issuance of LNTP No. 1 (“Guaranteed Train 2 Substantial Completion Date”);
3.Contractor shall achieve Substantial Completion of Train 3 on or before *** (***) Days after issuance of LNTP No. 1 (“Guaranteed Train 3 Substantial Completion Date”);
4.Contractor shall achieve Substantial Completion of Train 4 on or before *** (***) Days after issuance of LNTP No. 1 (“Guaranteed Train 4 Substantial Completion Date”);
5.Contractor shall achieve Substantial Completion of Train 5 on or before *** (***) Days after issuance of LNTP No. 1 (“Guaranteed Train 5 Substantial Completion Date”);
6.Contractor shall achieve Substantial Completion of Train 6 on or before *** (***) Days after issuance of LNTP No. 1 (“Guaranteed Train 6 Substantial Completion Date”); and
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7.Contractor shall achieve Substantial Completion of Train 7 on or before *** (***) Days after issuance of LNTP No. 1 (“Guaranteed Train 7 Substantial Completion Date”).
each a “Guaranteed Substantial Completion Date” and collectively, the “Guaranteed Substantial Completion Dates.” The Guaranteed Substantial Completion Dates shall only be adjusted by Change Order as provided under this Agreement.
B.Final Completion Date. Contractor shall achieve Final Completion no later than *** (***) Days after achieving Substantial Completion of Train 7 or as soon as reasonably practicable thereafter (if the Parties mutually agree, both acting reasonably) (“Final Completion Date”). The Final Completion Date shall only be adjusted by Change Order as provided under this Agreement.
5.4Project Schedule.
A.Initial Schedule. On the Agreement Date, Contractor shall submit to Owner for its review a detailed level 2 critical path method schedule for the Work that is consistent with the Guaranteed Dates and meets all of the requirements of Section 5.4B (such schedule is hereinafter referred to as the “Initial Schedule”). Contractor’s submission to Owner of the Initial Schedule shall be in native electronic format and portable document format.
B.Project Schedule. Within ninety (90) Days after LNTP No. 1, Contractor shall prepare and submit to Owner for its review a critical path method schedule for the Work using Primavera Project Planner version 8.2 or later (“Project Schedule”) in native electronic format and portable document format (“pdf”) developed in accordance with Attachment X. The Initial Schedule shall govern Contractor’s Work until the Project Schedule is prepared and reviewed by Owner. The Project Schedule shall be consistent with the Guaranteed Dates and shall represent Contractor’s best judgment as to how it shall complete the Work in compliance with the Guaranteed Dates. The Project Schedule shall, at a minimum, be detailed at a level 3 for all activities for the Stage 3 Facility and shall comply with GECP. Without limitation of the foregoing, the Project Schedule shall: (1) show the duration, early/late start dates, early/late finish dates, show a unique activity number, activity description, actual start/finish dates, remaining duration, and reflect logical relationships between activities, show an uninterrupted critical path from NTP through each of the Guaranteed Dates, including showing the dates for achieving each of the Payment Milestones and Guaranteed Dates; (2) be tagged by activity codes to allow sorting and filtering by responsible Contractor, Subcontractor, Sub-subcontractor, Owner activities, major work area, engineering, procurement, construction and commissioning; and (3) include the work breakdown structure identifier for each activity. Contractor shall submit with the Project Schedule the following: (a) progress “S” curve, showing the baseline plan and actual progress by Month for total progress of the Work, which shall be based on the Project Schedule; and (b) overall engineering and overall construction progress “S” curve, showing the actual progress by Month. Contractor shall use the Project Schedule in planning, organizing, directing, coordinating, performing and executing the Work, and the Project Schedule shall be the basis for evaluating progress of the Work. The Project Schedule shall reflect the critical path to Substantial Completion of each Train.
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C.Owner Review of the Initial Schedule and the Project Schedule. Owner may review the Initial Schedule and the Project Schedule for general conformance with this Agreement, including the Guaranteed Dates, and issue written comments to such Project Schedule. Once the Project Schedule and the required submittals have been reviewed by Owner, this version of the Project Schedule shall be the baseline Project Schedule for the Work. Owner’s review or acceptance of the Initial Schedule or the Project Schedule shall not relieve Contractor of any obligations for the performance of the Work, change any Guaranteed Date, nor shall it be construed to establish the reasonableness of the Project Schedule.
D.Monthly Updates to Project Schedule. After receipt by Owner of the Project Schedule Contractor shall manage and update the Project Schedule no less frequently than once per Month with Primavera Project Planner version 8.2 or later, using the critical path method, to reflect the actual progress to date (“Monthly Updated Project Schedule”). The Monthly Updated Project Schedule shall be in the same detail and form and meet all of the other requirements specified for the Project Schedule and shall be submitted by Contractor to Owner in pdf format on a Monthly basis, provided that the Monthly Updated Project Schedule shall also be submitted in native electronic format on a Quarterly basis or as otherwise requested by Owner, all as set forth in Attachment X in further detail.
E.90 Day Look-ahead Schedule. In accordance with Attachment X, Contractor shall submit to Owner a 90 Day look-ahead schedule (“90 Day Look-ahead Schedule”).
F.Other Reporting. Without limitation to Contractor’s other reporting requirements under this Agreement, Contractor shall provide to Owner the following reports on a Monthly basis, as required and described in greater detail in Attachment X: (i) Invoice and payment log showing Invoice numbers, dates, and amounts and payment receipt dates, and (ii) Change Order logs showing tracking numbers, descriptions, amounts, submittal dates and status (pending, approved or rejected).
G.Form of Submittals. All submittals by Contractor to Owner of the Initial Schedule, Project Schedule, Recovery Schedule and Acceleration Schedule shall be in pdf format, using Primavera Project Planner version 8.2 or later (except the Initial Schedule does not need to be developed using Primavera Project Planner). In addition, all of the following submittals by Contractor to Owner shall be in native electronic format using Primavera Project Planner version 8.2 or later: the Project Schedule; each Quarterly submission of the Monthly Updated Schedule or any other Monthly Updated Schedule requested by Owner; the Recovery Schedule and the Acceleration Schedule.

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5.5Recovery and Recovery Schedule. If, at any time during the prosecution of the Work, (a) should (i) the Monthly Updated Project Schedule show (or if Contractor has not provided the Monthly Updated Project Schedule and Owner reasonably determines) that any activity on the critical path of the Monthly Updated Project Schedule is delayed such that Substantial Completion of a Train is forecasted to occur thirty (30) or more Days after the applicable Guaranteed Substantial Completion Date, or (ii) Contractor fails to achieve Substantial Completion of a Train within thirty (30) Days after the applicable Guaranteed Substantial Completion Date, and (b) Contractor or any of its Subcontractors or Sub-subcontractors are, in Owner’s reasonable judgment, responsible for such delay, then Owner may, in addition to any other remedies that it may have under this Agreement, require that, as soon as reasonably possible, Contractor prepare a schedule to explain and display how it intends to regain compliance with the Project Schedule and the Guaranteed Dates within a sixty (60) Day period unless recovery cannot be reasonably achieved in such time, in which case the duration of the recovery period shall be for that period of time reasonably necessary to regain compliance with the Project Schedule and the Guaranteed Dates (“Recovery Schedule”). Contractor shall do the following after written notification by Owner of the requirement for a Recovery Schedule:
A.Within fifteen (15) Business Days after such notice, Contractor shall prepare the Recovery Schedule and submit it to Owner for its review. The Recovery Schedule shall represent Contractor’s best judgment as to how it shall regain compliance with the Project Schedule and the Guaranteed Dates and shall have a maximum duration of sixty (60) Days unless recovery cannot be reasonably achieved in such time, in which case the duration of the Recovery Schedule shall be for that period of time reasonably necessary to regain compliance with the Project Schedule. The Recovery Schedule shall also (i) be prepared in accordance with GECP, and (ii) have a similar level of detail as the Project Schedule.
B.Within fifteen (15) Days after Owner’s receipt of such Recovery Schedule but in all cases no later than thirty (30) Days after such notice, Contractor shall participate in a conference with Owner, and with any other Person, including Subcontractors and Sub-subcontractors, whom the Parties mutually agree should participate, to review and evaluate the Recovery Schedule. Contractor shall address all comments received from Owner during Owner’s review of the Recovery Schedule, and Contractor shall provide a written statement describing why any of Owner’s comments or proposed changes to the Recovery Schedule were not implemented by Contractor. Any of Owner’s comments or proposed changes to the Recovery Schedule that Contractor implements should be reflected in the revised Recovery Schedule, which shall be resubmitted for review by Owner within three (3) Days following the conference. The revised Recovery Schedule shall then be used by Contractor in planning, organizing, directing, coordinating, performing, and executing the Work (including all activities of Subcontractors and Sub-subcontractors) to regain compliance with the Project Schedule.
C.Five (5) Days prior to the expiration of the Recovery Schedule, Contractor shall meet with Owner at the Site to determine the effectiveness of the Recovery Schedule and to determine whether Contractor has regained compliance with the Project Schedule and the Guaranteed Dates. At the direction of Owner, one of the following shall happen:
1.If, in the reasonable opinion of Owner, Contractor is still behind schedule, Contractor shall be required to prepare another Recovery Schedule pursuant to Section
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5.5A above, to take effect during the immediate subsequent sixty (60) Day period or other longer period as may be reasonably necessary to regain compliance with the Project Schedule and the Guaranteed Dates.
2.If, in the reasonable opinion of Owner, Contractor has sufficiently regained compliance with the Project Schedule and the Guaranteed Dates, Contractor shall return to the use of the Project Schedule.
D.In preparing and executing the Recovery Schedule, Contractor shall take all commercially reasonable steps necessary to regain compliance with the Project Schedule and the Guaranteed Dates within a sixty (60) Day period unless recovery cannot be reasonably achieved in such time, in which case the duration of the recovery period shall be for that period of time reasonably necessary to regain compliance with the Project Schedule and Guaranteed Dates, which may include establishing additional shifts, hiring additional manpower, paying or authorizing overtime, providing additional Construction Equipment, and resequencing activities.
E.The cost of preparing and performance in accordance with the Recovery Schedule shall be for Contractor’s account.
F.Owner’s requirement and review of the Recovery Schedule shall not relieve Contractor of any obligations for the performance of the Work, change any Guaranteed Dates, or be construed to establish the reasonableness of the Recovery Schedule.
G.If, at any time prior to the applicable Guaranteed Substantial Completion Date, Contractor’s performance of the Work is delayed such that Substantial Completion of a Train is projected to achieve Substantial Completion beyond the applicable Guaranteed Substantial Completion Date (as may be adjusted by Change Order) to such an extent that a Delay Liquidated Damages cap in Section 20.2 would apply, and (i) Contractor fails to provide a Recovery Schedule in accordance with this Section 5.5 or (ii) Contractor provides a Recovery Schedule in accordance with this Section 5.5, but Contractor fails to materially comply with such Recovery Schedule, then Contractor shall be in Default, and Owner, after written notice to Contractor and a cure period of fifteen (15) Days from the date of Owner’s notice, shall have the right, prior to the applicable Guaranteed Substantial Completion Date, to terminate Contractor’s performance of the Work in accordance with Section 16.1A, except that in the case of a termination by Owner pursuant to this Section 5.5G solely for Contractor’s failure to provide a Recovery Schedule and materially comply therewith, Contractor’s liability under Section 16.1 arising out of such termination shall be limited to the applicable cap or caps in Section 20.2 and no Performance Liquidated Damages would be owed.
5.6Acceleration and Acceleration Schedule. Even if the Work is otherwise in compliance with the Project Schedule and Guaranteed Dates, Owner may, at any time, direct Contractor by Change Order or Unilateral Change Order to accelerate the Work by, among other things, establishing additional shifts, performing overtime Work, providing additional Construction Equipment or expediting Equipment; provided, however, such directive shall be reasonable, and (a) in no event shall Owner order with a Unilateral Change Order acceleration of the Work requiring Contractor to achieve any Substantial Completion or Final Completion prior to the respective Guaranteed Dates or if such acceleration is not
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technically feasible and (b) Contractor’s obligation with respect to an acceleration directive from Owner shall be limited to using commercially reasonable efforts to accelerate the Project Schedule. In the event of this directive, Owner shall pay to Contractor any (i) documented direct and indirect costs (and profit) clearly and solely attributable to such acceleration; and (ii) appropriate incentives, if any, that the Parties agree to in advance and which are set forth in the any Unilateral Change Order, as applicable. Any Unilateral Change Order shall be governed by Sections 6.1E and 6.2D. Any adjustment to the Contract Price or any other Changed Criteria that is necessitated by Owner’s acceleration of the Work shall be implemented by Change Order. If Owner directs Contractor to accelerate the Work, Contractor shall promptly commence and diligently perform the acceleration of the Work as directed by Owner and shall prepare a schedule to explain and display how it intends to accelerate the Work and how that acceleration will affect a critical path of the Project Schedule (the “Acceleration Schedule”). With respect to the Acceleration Schedule, Contractor shall do the following:
A.No later than fifteen (15) Business Days after such directive, Contractor shall prepare the Acceleration Schedule and submit it to Owner for its review. The Acceleration Schedule shall represent Contractor’s best judgment as to how it shall satisfy Owner’s acceleration directive. The Acceleration Schedule shall be prepared using GECP and to a similar level of detail as the Project Schedule.
B.Within fifteen (15) Business Days after issuance of such directive (or such longer time as specified in writing by Owner), Contractor shall participate in a conference with Owner, and with any other Person, including Subcontractors and Sub-subcontractors, whom Owner requests and Contractor agrees (with such agreement not to be unreasonably withheld) to participate, to review and evaluate the Acceleration Schedule. Any revisions to the Acceleration Schedule necessary as a result of this review shall be resubmitted for review by Owner as soon as reasonably practicable. The revised Acceleration Schedule shall then be the schedule which Contractor shall use in planning, organizing, directing, coordinating, performing, and executing that portion of the Work that is affected by such acceleration, with the Project Schedule governing the performance of all other Work.
C.Owner’s review of the Acceleration Schedule shall not constitute an independent evaluation or determination by Owner of the workability, feasibility, or reasonableness of that schedule.
ARTICLE 6
CHANGES; FORCE MAJEURE; AND OWNER CAUSED DELAY
6.1Owner’s Right to Change Order. Owner may, at any time, instruct Contractor to alter, amend, omit, or suspend the Work or modify the requirements of this Agreement in accordance with this Section 6.1.
A.Prior to the execution of any Change Order under this Section 6.1, Owner shall notify Contractor of the nature of the proposed addition to, omission from, deletion from, suspension of, or any other modification or adjustment to the requirements of this Agreement, by issuing a change request to Contractor in the form of Schedule D-3, Part 1 (“Change Request”).
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B.Within ten (10) Business Days after Contractor’s receipt of such Owner’s Change Request (when reasonably possible but if it is not reasonably possible for Contractor to provide all of the information required under this Section 6.1B within such ten (10) Business Day period, Contractor shall provide Owner with as much information as reasonably possible as well as the reason that additional time is required, but in no event later than thirty (30) Business Days following Contractor’s receipt of Owner’s written request for a change), Contractor shall respond to Owner with a written statement in the form of Schedule D-3, Part 2 detailing:
1.the description of Work to be performed and a program for its execution;
2.a preliminary assessment of the effect (if any) such request, were it to be implemented by Change Order, would have on the Changed Criteria; and
3.the original Owner’s Change Request number and revision numbers.
C.After submission of Contractor’s written preliminary assessment in accordance with Section 6.1B and upon Owner’s written request, Contractor shall provide Owner within ten (10) Business Days (or if Contractor requires third party quotes in order to prepare the comprehensive written estimate required under this Section 6.1C or states that a longer time period is reasonably required at the time Contractor provides the preliminary assessment, within thirty (30) Days or such longer period if mutually agreed by the Parties in writing), a comprehensive written estimate setting forth in detail the effect, if any, which such request, if implemented by Change Order, would have on the Contract Price, the Guaranteed Dates, the Basis of Design, the Payment Schedule, any of the Minimum Acceptance Criteria or Performance Guarantees, or any other obligation or potential liability of Contractor hereunder (collectively or individually, the “Changed Criteria”). This detailed estimate shall (i) include a fixed price breakdown (unless otherwise agreed by the Parties in writing) for the Work to be performed derived from the unit rates set forth in Schedule D-4 to the extent applicable or, if not stated therein, derived from rates not to exceed then-current market rates, (ii) include all information required by Section 6.5B, and (iii) supplement and supersede the assessment provided under Section 6.1B.
D.If the Parties agree on such Changed Criteria for such request, the Parties shall execute a Change Order, which shall be in the form of Schedule D-1 and such Change Order shall become binding on the Parties, as part of this Agreement.
E.If the Parties cannot agree on such Changed Criteria for such request within fifteen (15) Business Days after Owner’s receipt of Contractor’s comprehensive written estimate specified in Section 6.1C, unless mutually extended in writing by the Parties, or if Owner desires that the proposed changed Work set forth in such Owner’s notice commence immediately without the requirement of a preliminary estimate or comprehensive estimate by Contractor as required under Section 6.1B or 6.1C, Owner may, by issuance of a Unilateral Change Order in the form attached hereto as Schedule D-2 (“Unilateral Change Order”), require and authorize Contractor to commence and perform the changed Work specified in the Unilateral Change Order in accordance with the rates as set forth in Schedule D-4 (or if not specified therein, at rates not to exceed then-current market rates) with the effect of such Unilateral Change Order on
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the Changed Criteria (or if the Parties agree on the effect of such Unilateral Change Order for some but not all of the Changed Criteria, the impact of each of the components of the Changed Criteria on which the Parties disagree) to be determined as soon as possible but without prejudice to Contractor’s right to refer any Dispute for resolution in accordance with Article 18. Notwithstanding the foregoing, Owner may not (1) issue a Unilateral Change Order (a) that would cause an adjustment to the Minimum Acceptance Criteria or the Performance Guarantees or (b) that would require Contractor to handle, transport or remediate any Pre-Existing Contamination or Arsenic without Contractor’s agreement in the form of a mutual Change Order or (2) issue any Unilateral Change Order (a) where such Unilateral Change Order would result in an increase in the Contract Price exceeding *** U.S. Dollars (U.S. $***), or (b) if in conjunction with other outstanding Unilateral Change Orders issued by Owner, such Unilateral Change Orders would in themselves result in an increase in the Contract Price equal to or exceeding *** U.S. Dollars (U.S. $***). After Owner’s issuance of a Unilateral Change Order, the Parties shall continue to negotiate in good faith to reach agreement on the Changed Criteria. If the Parties cannot agree on the effect of such Unilateral Change Order within a reasonable period of time but no longer than ninety (90) Days after Owner’s receipt of all supporting documentation reasonably required by Owner to evaluate the Changed Criteria, then the Dispute shall be resolved as provided in Article 18. Pending resolution of the Dispute, Contractor shall perform the Work as specified in such Unilateral Change Order and Owner shall pay Contractor on a Monthly basis for (i) additional design and engineering Work related to the changed Work specified in the Unilateral Change Order in accordance with the rates set forth in Schedule D-4; (ii) the actual purchase price of Equipment procured by Contractor, plus associated margin of *** percent (***%) on such purchase price for profit and corporate overhead; and (iii) Work performed in the field (such as relocation of Equipment within the Facilities) at the rates set forth in Schedule D-4. When Owner and Contractor agree on the effect of such Unilateral Change Order on all of the Changed Criteria, such agreement shall be recorded by execution by the Parties of a Change Order in the form attached hereto as Schedule D-1, which shall supersede the Unilateral Change Order previously issued and relating to such changed Work. Contractor shall be considered to be in Default under Section 16.1 should it (x) fail to commence (which may include planning or design activities) the performance of the changed Work or other obligations required in such Unilateral Change Order within seven (7) Business Days after receipt of such Unilateral Change Order (or within such other longer time as specified in such Unilateral Change Order), or (y) fail to diligently perform the changed Work or other obligations required in such Unilateral Change Order.
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F.On or prior to the dates specified in Attachment NN, Owner may exercise the additional scope options or scope reductions set forth therein, and in such event the Parties shall execute a Change Order adjusting the Contract Price and the Scope of Work as specified in Attachment NN.
G.Owner shall be entitled to reductions in the Contract Price to the extent permitted in Attachment MM.
6.2Contractor’s Right to Change Orders.
A.Contractor shall only have the right to a Change Order in the event of any of the following occurrences:
1.Acts or omissions of a member of the Owner Group, Owner’s consultants under Section 2.5D or any other Person acting on behalf of or under the control of Owner that constitute a failure to perform as required of Owner under this Agreement and adversely affect either (a) Contractor’s actual cost (which costs shall be adequately documented and supported by Contractor) of performance of the Work or (b) Contractor’s ability to perform any requirement under this Agreement; provided that Contractor shall not be entitled to a Change Order to the extent that such acts or omissions of Owner are caused by Contractor’s failure to perform its obligations under this Agreement. If such acts or omissions cause a delay (as that term is defined Section 6.10), Contractor shall be entitled to relief to the extent allowed under Section 6.8;
2.Force Majeure to the extent allowed under Section 6.7A;
3.Acceleration of the Work ordered by Owner pursuant to Section 5.6;
4.Owner’s request for an increase in coverage under the Letter of Credit pursuant to Section 9.2 to cover any increase in the Contract Price as a result of Change Orders;
5.To the extent expressly permitted under Sections 2.5B.2, 3.3C.5, 3.27B, 3.27C, 4.3, 5.2C, 6.13, 8.2D, 11.7, 12.2D and 12.3A;
6.To the extent expressly permitted under Sections 3.4C, 7.1D, 7.1E, 7.10, 7.11, 9.1C, Sections 1A(10), 1A(12), 1K, 1S and 1U of Attachment O and Section 7 of Attachment LL;
7.Changes in Law that occur after the Agreement Date and that adversely affects either (a) Contractor’s actual cost (which costs shall be adequately documented and supported by Contractor) of performance of the Work, or (b) Contractor’s ability to perform any requirement under this Agreement, provided that under no circumstances shall Contractor be entitled to any relief for changes in tariffs or duties (whether occurring prior to or after the Agreement Date) except to the extent Contractor is entitled to a Change Order for a change in tariffs and duties to the extent permitted under Sections 6.2A10 and 6.2A13. If such Changes in Law causes a delay (as that term is defined
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Section 6.10), Contractor shall be entitled to relief to the extent allowed under Section 6.8. Notwithstanding anything provided in this Agreement, any change in Applicable Law related to Changes in U.S. Duties and Tariffs shall be addressed exclusively and Contractor shall be entitled to a Change Order only to the extent permitted in Attachment GG and any change in Applicable Law related to Non-U.S. Duties and Tariffs shall be addressed exclusively and Contractor shall be entitled to a Change Order only to the extent permitted in Section 6.2A13;
8.Suspension in Work ordered by Owner pursuant to Section 16.3 or by Contractor pursuant to Section 16.4;
9.Changes to the Rely Upon Information or errors or inaccuracies in the Rely Upon Information that adversely affect Contractor’s (a) actual cost (which costs shall be adequately documented and supported by Contractor) of performance of the Work, or (b) ability to perform any material requirement under this Agreement. If such errors, inaccuracies or changes in the Rely Upon Information cause a delay (as that term is defined in Section 6.10), Contractor shall be entitled to relief to the extent allowed under Section 6.8;
10.Changes in U.S. Duties and Tariffs to the extent allowed under Attachment GG;
11.Any Pre-Existing Contamination or Arsenic on the Land for which Owner is responsible for under Sections 3.17 or 4.9 that adversely affects (a) Contractor’s costs to perform of the Work or (b) Contractor’s ability to perform any obligation under this Agreement. If such occurrence causes a delay (as that term is defined Section 6.10), Contractor shall be entitled to relief to the extent allowed under Section 6.8;
12.Delay beyond the permissible times specified in Section 1.A(9)g(2) of Attachment O for the delivery by Owner to Contractor of builder’s risk or marine cargo insurance proceeds received by the Collateral Agent (or if no Collateral Agent (as defined in Attachment O), a mutually agreed upon escrow agent) shall relieve Contractor of any obligation under this Agreement to effect repairs or other restoration of the Work affected by the insured occurrence for any costs of repairs or restoration exceeding the sum of the deductible under such insurance and any amounts previously paid to Contractor under such insurance and shall entitle Contractor to a Change Order adjusting the Contract Price and Guaranteed Dates, but only to the extent such delay adversely affects (a) Contractor’s costs of performance of the Work or (b) Contractor’s ability to perform any obligation under this Agreement; provided that, notwithstanding the foregoing, in no event shall this Section 6.2A.12 in any way relieve Contractor from any obligation to perform any work necessary to maintain the builder’s risk and marine cargo insurance in full force and effect. If such occurrence causes a delay (as that term is defined Section 6.10), Contractor shall be entitled to relief to the extent allowed under Section 6.8; and
13.To the extent permitted in Section 7.13.
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B.Should Contractor desire a Change Order under this Section 6.2, Contractor shall, pursuant to Section 6.5, notify Owner in writing and issue to Owner, at Contractor’s expense, the notices and information required by Section 6.5. Any adjustments to the Contract Price shall be requested on a fixed price basis (unless otherwise agreed by the Parties in writing) and shall be derived from the rates set forth in Schedule D-4 to the extent applicable or, if not stated therein, derived from rates not to exceed then-current market rates.
C.Owner shall respond to Contractor’s request within thirty (30) Days of receipt (unless Owner requests additional information in order to respond), stating (i) whether Owner agrees that Contractor is entitled to a Change Order and (ii) the extent, if any, to which Owner agrees with Contractor’s statement regarding the effect of the proposed Change Order on the Changed Criteria, including any adjustment to the Contract Price. If Owner agrees that a Change Order is necessary and agrees with Contractor’s statement regarding the effect of the proposed Change Order on the Changed Criteria, then Owner shall issue such Change Order, which shall be in the form of Schedule D-1, and such Change Order shall become binding on the Parties as part of this Agreement upon execution thereof by the Parties.
D.If the Parties agree that Contractor is entitled to a Change Order but cannot agree on the effect of the proposed Change Order on the Changed Criteria within fourteen (14) Days after Owner’s receipt of Contractor’s written notice and proposed Change Order and all other required information, or if Owner desires that the proposed changed Work set forth in the proposed Change Order commence immediately, the rights, obligations and procedures set forth in Section 6.1E are applicable.
E.If the Parties cannot agree upon whether Contractor is entitled to a Change Order within ten (10) Business Days after Owner’s receipt of Contractor’s request and proposed Change Order, then the Dispute shall be resolved as provided in Article 18. Pending resolution of the Dispute, Contractor shall continue to perform the Work required under this Agreement, and Owner shall continue to pay Contractor in accordance with the terms of this Agreement, as modified by any previously agreed Change Orders, and with the terms of any Unilateral Change Orders.
6.3Changed Criteria Adjustment; Contractor Documentation. If a Change Order is executed on a time and materials basis pursuant to Section 6.1E or 6.2D, then interim payments shall be made to Contractor in accordance with the terms of Section 6.1E for such Unilateral Change Order Work; provided that the Contract Price shall not be adjusted unless and until the Dispute is resolved in accordance with Article 18 or by mutual agreement of the Parties. Contractor shall use reasonable efforts to minimize such costs (consistent with the requirements of this Agreement) and shall provide Owner with options for reducing such costs whenever possible. The foregoing costs shall be supported by reasonable documentation, including daily work logs, time sheets, invoices and receipts.
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6.4Change Orders Act as Accord and Satisfaction. Change Orders agreed pursuant to Section 6.1D or 6.2C by the Parties, and Unilateral Change Orders entered into pursuant to Section 6.1E or 6.2D in which the Parties have subsequently agreed upon the effect of such Unilateral Change Order and executed a superseding and mutually agreed upon Change Order as provided in Section 6.1D or 6.2C, shall, unless otherwise expressly reserved in such Change Order, constitute a full and final settlement and accord and satisfaction of all effects of the change as described in the Change Order upon the Changed Criteria and shall be deemed to compensate Contractor fully for all direct and indirect impacts of such change. Accordingly, unless otherwise expressly reserved in such Change Order, Contractor expressly waives and releases any and all right to make a claim or demand or to take any action or proceeding against Owner for any other consequences arising out of, relating to, or resulting from such change reflected in such Change Order, whether the consequences result directly or indirectly from such change reflected in such Change Order, including any claim or demand for damages due to delay, disruption, hindrance, impact, interference, inefficiencies or extra work arising out of, resulting from, or related to, the change reflected in that Change Order (including any claims or demands that any Change Order or number of Change Orders, individually or in the aggregate, have impacted the unchanged Work). If Contractor expressly reserves its right in a Change Order to maintain a claim arising out of the change in the Change Order, then Contractor shall provide Owner with notice every ninety (90) Days setting forth the then known impact of the reserved claim in the Change Order, provided that Contractor shall provide no further notice later than one hundred eighty (180) Days prior to Substantial Completion of the applicable Train to which the Change Order relates (and at this point Contractor waives any additional claims it may have beyond what Contractor has already notified as required above); provided however, if the applicable Change Order is executed within one hundred eighty (180) Days prior to Substantial Completion of the applicable Train to which the Change Order relates, in which case Contractor shall provide Owner with notice every ninety (90) Days setting forth the then known impact of the reserved claim in the Change Order, however Contractor shall provide no further notice on such Change Order later than Substantial Completion of the applicable Train to which the Change Order relates (and at this point Contractor waives any additional claims it may have beyond what Contractor has already notified as required above).
6.5Timing Requirements for Change Notices Issued by Contractor. Should any circumstance that Contractor has reason to believe may give rise to the right to a Change Order, Contractor shall, with respect to each such circumstance:
A.issue a notice of change (“Initial Notice of Change”) to Owner within fourteen (14) Days following the date that Contractor knew of, or sixty (60) Days after the date that Contractor reasonably should have known of, the first occurrence or beginning of such circumstance; provided that if such occurrence or circumstance is an emergency, oral notice shall be given immediately, followed by an Initial Notice of Change within seventy two (72) hours after such oral notice is provided.
1.In such Initial Notice of Change, Contractor shall state in detail all known and presumed facts upon which its claim is based, including the character, duration and extent of such circumstance, the date Contractor first knew of such circumstance, any activities impacted by such circumstance, the estimated cost and time consequences of such circumstance (including showing a good faith estimate of the impact of such circumstance, if any, on the critical path shown on the Monthly Updated Project
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Schedule) and any other details or information that are expressly required under this Agreement;
2.Contractor shall only be required to comply with the notice requirements of this Section 6.5A once for continuing circumstances, provided the notice expressly states that the circumstance is continuing and includes Contractor’s best estimate of the impact on any Changed Criteria by such circumstance; and
B.submit to Owner a comprehensive written estimate no later than forty five (45) Days (unless mutually extended by the Parties in writing) after the later of (1) the date that the notice in Section 6.5A.2 is given and (2) the completion of each such circumstance, together with a written statement (a) detailing why Contractor believes that a Change Order should be issued, plus all documentation reasonably requested by or necessary for Owner to determine the factors necessitating the possibility of a Change Order and all other information and details expressly required under this Agreement (including the information required by Schedule D-4, applicable detailed estimates and cost records, time sheet summaries and a graphic demonstration using the Project Schedule, showing Contractor’s entitlement to a time extension to the Guaranteed Dates pursuant to the terms of this Agreement, which shall be provided in hard copy and in its native electronic format); and (b) setting forth the effect, if any, which such proposed Change Order would have for the Work on any of the Changed Criteria.
C.If Contractor fails to provide the notice as required under this Section 6.5, and if Owner demonstrates that it has been prejudiced on account of such failure to provide notice, then, to the extent that Owner is so prejudiced, Contractor waives its right for, and releases Owner from and against any claims for, adjustments in the Contract Price, the Guaranteed Substantial Completion Dates, Payment Schedule, any Work, any of the Minimum Acceptance Criteria or Performance Guarantee or any other modification to any other obligation of Contractor under this Agreement. Oral notice, shortness of time, or Owner’s actual knowledge of a particular circumstance shall not waive, satisfy, discharge or otherwise excuse Contractor’s strict compliance with this Section 6.5. Contractor shall have the burden of proof with respect to any claim made by it.
6.6Adjustment Only Through Change Order. No change in the requirements of this Agreement, whether an addition to, deletion from, suspension of or modification to this Agreement, including any Work, shall be the basis for an adjustment to any Changed Criteria or right of Owner under this Agreement unless and until such addition, deletion, suspension or modification has been authorized by a Change Order executed and issued in accordance with and in strict compliance with the requirements of this Article 6, except that the Work may be changed by a Unilateral Change Order. Contractor shall not perform any change in the Work unless and until such change is authorized pursuant to a Change Order or Unilateral Change Order in accordance with this Article 6, and all costs incurred by Contractor prior to authorization by Change Order shall be for Contractor’s account. No course of conduct or dealings between the Parties (including the issuance of an Owner’s Change Request or Contractor’s notice of changes or claims), nor express or implied acceptance of additions, deletions, suspensions or modifications to this Agreement, and no claim that Owner has been unjustly enriched by any such addition, deletion, suspension or modification to this Agreement, whether or not there is in fact
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any such unjust enrichment, shall be the basis for any claim for an adjustment to the Changed Criteria or any other obligations of Contractor under this Agreement.
6.7Force Majeure.
A.Contractor Relief. If the commencement, prosecution or completion of the Work is delayed by Force Majeure, then Contractor shall be entitled to an extension to the applicable Guaranteed Dates to the extent, if any, permitted under Section 6.7A.1 and an adjustment to the Contract Price to the extent, if any, permitted under Section 6.7A.2 provided that Contractor complies with the notice and Change Order requirements in Section 6.5 and the mitigation requirements in Section 6.11. All time extensions to the Guaranteed Dates and adjustments to the Contract Price for the delays described in this Section 6.7A shall be by Change Order implemented and documented as required under Article 6.
1.Time Extension. Contractor shall be entitled to an extension to the applicable Guaranteed Dates for delay caused by Force Majeure if such delay affects the performance of any Work that is on the critical path shown on the Monthly Updated Project Schedule.
2.Compensation. Contractor shall be entitled to an adjustment to the Contract Price in accordance with the following: for any delay that meets the requirements of this Section 6.7A.2, if such delay, alone or in conjunction with other Force Majeure events, causes Contractor delay in the performance of any Work that is on the critical path shown on the Monthly Updated Project Schedule of more than thirty (30) Days in the aggregate, provided, however, with respect to Train-Related Prolongation Costs and Project-Related Prolongation Costs, Contractor shall only be entitled to an adjustment to the Contract Price for such delays if and to the extent that Contractor demonstrates that, based on the Monthly Updated Project Schedule using critical path analysis, Work on the critical path shown on the Monthly Updated Project Schedule will be delayed and such delays will cause Contractor to achieve Substantial Completion of such Train or Trains beyond the earlier of the forecasted date for Substantial Completion for such Train or Trains as shown on the Monthly Updated Project Schedule or the Guaranteed Substantial Completion Date in effect at the time of such delay for such Train or Trains, and in each case Contractor shall be entitled to an adjustment to the Contract Price based on such delays equal to (i)(a) *** percent (***%) of the Train-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor with respect to each such Train impacted by the Force Majeure event after such thirty (30) Days in the aggregate until such delays will cause Contractor to achieve Substantial Completion of such Train or Trains beyond the Guaranteed Substantial Completion Date in effect at the time of such delay for such Train or Trains, and (b) *** percent (***%) of Train-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor with respect to each such Train impacted by the Force Majeure event after such thirty (30) Days in the aggregate after each such Guaranteed Substantial Completion Date for such Train or Trains, and (ii)(a) *** percent (***%) of the Project-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor after such thirty (30) Days in the aggregate upon delay to Train 7 until such delays will cause
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Contractor to achieve Substantial Completion of Train 7 beyond the Guaranteed Substantial Completion Date for Train 7 in effect at the time of such delay for Train 7, and (b) *** percent (***%) of Project-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor after such thirty (30) Days in the aggregate after such Guaranteed Substantial Completion Date for Train 7, provided however that and for the avoidance of doubt, if Contractor’s forecasted date for the applicable Substantial Completion for such Train or Trains is after the applicable Guaranteed Substantial Completion Date(s) (as such is required to be extended under this Section 6.7A.1 and Section 6.8A), then, in such circumstance, Owner shall not be liable for any Prolongation Costs arising out of a delay which otherwise meets the requirement set forth in this Section 6.7A that are incurred prior to such forecasted date but after the Guaranteed Substantial Completion Date (as such is required to be extended under this Section 6.7A.1 and Section 6.8A). For the avoidance of doubt, only one (1) aggregate period of thirty (30) Days applies to any and all entitlements to adjustments to the Contract Price under this Section 6.7A.2. Any such Contract Price adjustment shall be for reasonable costs necessarily incurred by Contractor with respect to each Train impacted by the Force Majeure event, as applicable, for delay or in mitigation or avoidance of delay occurring after the expiration of such thirty (30) Day period referenced in this Section 6.7A.2. Notwithstanding anything to the contrary herein, Owner’s total liability under this Agreement for any Contract Price adjustment(s) for all Force Majeure events occurring during the term of this Agreement shall not exceed *** U.S. Dollars (U.S. $***) in the aggregate.
B.Owner Relief. Subject to Section 6.7C, Owner’s obligations under this Agreement shall be suspended to the extent that performance of such obligations is delayed by Force Majeure (but without prejudice to Contractor’s entitlement to a Change Order for the events described in Section 6.2A).
C.Payment Obligations. No obligation of a Party to pay moneys under or pursuant to this Agreement shall be excused by reason of Force Majeure affecting such Party.
6.8Delay Caused by Owner, etc. for Which Owner Is Responsible, Time Extensions and Compensation Adjustments.
A.Should (1) any member of Owner Group or any Person acting on behalf of or under the control of Owner delay the commencement, prosecution or completion of the Work, including Owner’s failure to provide an Owner-Furnished Items, and to the extent such delay is not attributable to Contractor or its Subcontractors or Sub-subcontractors but is caused by Owner’s failure to perform an express obligation of Owner under this Agreement, or (2) the commencement, prosecution or completion of the Work be delayed as a result of (a) Changes in Law for which Contractor is entitled to relief under Section 6.2A.7, (b) changes to or errors or inaccuracies in Rely Upon Information for which Contractor is entitled to relief under Section 6.2A.9, (c) a suspension of the Work for which Contractor is entitled to relief under Section 6.2A.8, (d) discovery of Pre-Existing Contamination or Arsenic on the Land for which Contractor is entitled to relief under Section 6.2A.11, (e) any of the bases set forth in Section 6.2A.5, (f) Changes in U.S. Duties and Tariffs for which Contractor is entitled to relief under
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Section 6.2A.10, and (g) delays for which Contractor is entitled to relief under Section 6.2A.12, then Contractor shall, with respect to any of the above, be entitled to an extension to the applicable Guaranteed Substantial Completion Dates if (i) such delay affects the performance of any Work that is on the critical path shown on the Monthly Updated Project Schedule and (ii) Contractor complies with the notice and Change Order request requirements in Section 6.5 and the mitigation requirements of Section 6.11. Contractor shall be entitled to an adjustment to the Contract Price for reasonable, additional costs (including markups for Contractor’s overhead and associated profit margin of *** percent (***%) for such costs) incurred by Contractor for a delay which otherwise meets the requirements set forth in this Section 6.8 or in mitigation or avoidance of such delay; provided that, with respect to Train-Related Prolongation Costs and Project-Related Prolongation Costs, Contractor shall only be entitled to an adjustment to the Contract Price for such delays if and to the extent that Contractor demonstrates that, based on the Monthly Updated Project Schedule using critical path analysis, Work on the critical path shown on the Monthly Updated Project Schedule will be delayed and such delays will cause Contractor to achieve Substantial Completion of such Train or Trains beyond the earlier of the forecasted date for Substantial Completion for such Train or Trains as shown on the Monthly Updated Project Schedule or the Guaranteed Substantial Completion Date in effect at the time of such delay for such Train or Trains, and in each case Contractor shall be entitled to an adjustment to the Contract Price based on such delays equal to (i)(a) *** percent (***%) of the Train-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor with respect to each such Train impacted by such delays until such delays will cause Contractor to achieve Substantial Completion of such Train or Trains beyond the Guaranteed Substantial Completion Date in effect at the time of such delay for such Train or Trains, and (b) *** percent (***%) of Train-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor with respect to each such Train impacted by such delay after each such Guaranteed Substantial Completion Date for such Train or Trains and (ii)(a) *** percent (***%) of the Project-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor upon delay to Train 7 until such delays will cause Contractor to achieve Substantial Completion of Train 7 beyond the Guaranteed Substantial Completion Date for Train 7 in effect at the time of such delay of Train 7, and (b) *** percent (***%) of Project-Related Prolongation Costs that Contractor demonstrates will be incurred by Contractor after such Guaranteed Substantial Completion Date for Train 7, provided however that and for the avoidance of doubt, if Contractor’s forecasted date for the applicable Substantial Completion for such Train or Trains is after the applicable Guaranteed Substantial Completion Date(s) (as such is required to be extended under Section 6.7A.1 and this Section 6.8A), then, in such circumstance, Owner shall not be liable for any Prolongation Costs arising out of a delay which otherwise meets the requirements of this Section 6.8A that are incurred prior to such forecasted date but after the Guaranteed Substantial Completion Date (as such is required to be extended under Section 6.7A.1 and this Section 6.8A). Any adjustments to the Contract Price or a Guaranteed Substantial Completion Date shall be recorded in a Change Order.
B.The Parties agree that if they execute a Change Order with respect to any change in the Scope of Work described in this Section 6.8, any delay arising out of such change in the Scope of Work and meeting the requirements of this Section 6.8 shall be included in the Change Order incorporating such change in the Scope of Work.
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6.9Work Activity on the Critical Path. The Parties recognize that for the purposes of Section 6.7, Section 6.8 and Section 6.13B, a Work activity not on the critical path can become on the critical path, and if a delay causes a Work activity off the critical path to become a critical path activity, Contractor is entitled to an extension to the applicable Guaranteed Date for those days of delay after which the non-critical path activity becomes a critical path activity; provided that Contractor complies with the notice and Change Order request requirements in Section 6.5 and the mitigation requirements of Section 6.11.
6.10Delay. For the purposes of Sections 6.2A.1, 6.2A.7, 6.2A.9, 6.2A.11, 6.2A.12, 6.7 6.8, and 6.13 the term “delay” shall include hindrances, disruptions or obstructions, or any other similar term in the industry and the resulting impact from such hindrances, disruptions or obstructions, including inefficiency, impact, ripple or lost production.
6.11Contractor Obligation to Mitigate Delay. With respect to Sections 6.7 and 6.8, in no event shall Contractor be entitled to any adjustment to the Guaranteed Dates or adjustment to the Contract Price for that portion of delay to the extent Contractor could have taken, but failed to take, reasonable actions to mitigate such delay.
6.12Separated Contract Price Adjustments in Change Orders. Any adjustment by Change Order to the Contract Price shall be made on a fixed price separated basis as provided in 34 Tex. Admin. Code Rule § 3.291(a)(13) to specify the applicable adjustments to the Aggregate Equipment Price and Aggregate Labor and Skills Price in accordance with Article 7.
6.13COVID-19 Provisional Sum and COVID-19 Events.
A.COVID-19 Provisional Sum. Set forth in Attachment KK are countermeasures, means, methods, responsive and preventative measures with respect to COVID-19 (“COVID-19 Countermeasures”) that Contractor or its Subcontractors or Sub-subcontractors may implement in the performance of the Work in accordance with Section 6.13A.1 and 6.13A.2. The Parties have included in the Contract Price an estimated provisional sum for the implementation of such COVID-19 Countermeasures, as set forth in Attachment KK (“COVID 19 Provisional Sum”). Owner shall pay to Contractor, in accordance with this Section 6.13 and Attachment KK (at the rates shown and referenced therein), the costs and expenses incurred by Contractor (or its applicable Subcontractors or Sub-subcontractors) as a result of COVID-19 for implementing the COVID-19 Countermeasures set forth therein, even if such costs and expenses exceed the COVID-19 Provisional Sum, provided that Contractor may only invoice Owner for the actual costs and expenses incurred by Contractor as a result of COVID-19 plus a markup of *** (***%) and Contractor may not invoice Owner (and Owner shall have no obligation to pay) any other costs, including any amounts for contingency or escalation. The costs associated with implementing such COVID-19 Countermeasures are set forth and further detailed in Attachment KK and any additional costs and expenses incurred above and beyond the estimates set forth in Attachment KK shall be based on the estimates set forth therein. To the extent that the value of the COVID-19 Countermeasures exceed the amount set forth in Attachment KK, Contractor is entitled to a Change Order to increase the amount of the Provisional Sum (and a corresponding increase in the Contract Price). Owner is entitled to a Change Order reducing the Contract Price
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if the costs and expenses incurred in implementing the COVID-19 Countermeasures are less than the COVID-19 Provisional Sum.
1.Schedule KK-1 lists the COVID-19 Countermeasures that Contractor has initially determined will be implemented by Contractor commencing after LNTP No. 1. The COVID-19 Provisional Sum for the COVID-19 Countermeasures in Schedule KK-1 assumes that these COVID-19 Countermeasures will be implemented at LNTP No. 1 and continue (except as stated otherwise in Schedule KK-1) for twelve (12) months following LNTP No. 1, which such duration after LNTP No. 1 may be extended for a COVID-19 Extension. Contractor may extend the duration of the implementation of the COVID-19 Countermeasures in Schedule KK-1 beyond the period specified in Schedule KK-1 due to a COVID-19 Extension. A “COVID-19 Extension” means a circumstance following LNTP No. 1 where the time period for the implementation of any of COVID-19 Countermeasures in Schedule KK-1 has expired and: (a) Contractor is required under Applicable Law to continue implementing such COVID-19 Countermeasures beyond the period currently indicated in Schedule KK-1 in order to perform the Work in compliance with Applicable Laws, (b) a Change in COVID-19 Guidelines recommend the continuance of the COVID-19 Countermeasures in Schedule KK-1 for time-periods extending beyond the period then currently indicated in Schedule KK-1 and Contractor elects to implement such Change in COVID-19 Guidelines; (c) there is COVID-19 Outbreak and Contractor elects to continue such COVID-19 Countermeasures; or (d) Contractor otherwise elects to continue or revise such means, methods and countermeasures in effect as to protect those performing the Work from the spread of COVID-19.
2.Schedule KK-2 lists the COVID-19 Countermeasures that Contractor has initially determined will be implemented by Contractor commencing at LNTP No. 1 and be ongoing without interruption during the performance of the Work for the duration specified in Schedule KK-2.
3.Contractor shall receive no adjustments to the Project Schedule (including an extension to any Guaranteed Date) for implementing any COVID-19 Countermeasures listed in Attachment KK (except as Contractor may be entitled to same for a COVID-19 Extension affecting the Work for Rows 10 and 21 of Schedule KK-1), regardless of which COVID-19 Countermeasures are implemented and for how long. Contractor shall only be entitled to claim an adjustment to the Guaranteed Substantial Completion Dates for COVID-19 Events, which are separately addressed in Section 6.13B.
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B.COVID-19 Event Cost and Schedule Impacts. If the occurrence of a COVID-19 Event (including Contractor’s, its Subcontractor’s or Sub-Subcontractor’s responsive and preventative actions thereto, or adopting additional or different countermeasures or other means and methods in performing the Work from the COVID-19 Countermeasures in response thereto) adversely affect Contractor’s actual cost (which costs shall be adequately documented and supported by Contractor) of performance of the Work, Contractor shall be entitled to a Change Order adjusting the Contract Price. If such COVID-19 Event (or such actions, countermeasures and/or means and methods) causes a delay (as that term is defined Section 6.10), Contractor shall be entitled to relief to the extent permitted in Section 6.8. Contractor (or Subcontractor or Sub-subcontractors) shall receive no relief as a result of changes in market conditions that arise out of the impact to the Work from COVID-19 or any COVID-19 Event unless Contractor demonstrates that such impact is caused by a COVID-19 Event, but excluding changes in market conditions that arise indirectly from such impact or that result in a general escalation of prices for labor, materials (other than those specified in Attachment MM), equipment and services.
C.COVID-19 – Countermeasures, Means and Methods and Mitigation. Contractor (and its Subcontractors and Sub-Subcontractors) may implement COVID-19 Countermeasures, adopt additional or different countermeasures or other means and methods in performing the Work from those COVID-19 Countermeasures set forth in Attachment KK, and take responsive and preventative actions (such as the right to suspend the Work, in whole or in part, or evacuate personnel, in each case after consultation with Owner, and including the COVID-19 Countermeasures) in response to a COVID-19 Event that are reasonably necessary to protect those performing the Work from the spread of COVID-19 or other epidemics, pandemics, or plagues, or reasonably necessary to otherwise mitigate or prevent the spread of COVID-19 or other epidemics, or pandemics, or plagues.
D.COVID-19 Event Performance Prevention. If a COVID-19 Event (including the effects of such COVID-19 Event) prevents the performance with respect to any portion of the Work, Contractor (and its applicable Subcontractor or Sub-subcontractor) shall be relieved from performance of such portion of the Work for the time period that such COVID-19 Event, or the effects of such COVID-19 Event, are continuing; provided that Contractor’s entitlement to a Change Order for an adjustment to the Contract Price and Guaranteed Substantial Completion Dates shall be determined in accordance with Section 6.8.
ARTICLE 7
CONTRACT PRICE AND PAYMENTS TO CONTRACTOR
7.1Contract Price. As compensation in full to Contractor for the full and complete performance of the Work and all of Contractor’s other obligations under this Agreement, Owner shall pay and Contractor shall accept Five Billion Four Hundred Eighty-Four Million U.S. Dollars (U.S. $5,484,000,000) (the “Contract Price”), which is separated in Section 7.1A and Section 7.1B below. The Contract Price is subject to adjustment only by Change Order as provided in Article 6, and includes all Taxes payable by Contractor, its Subcontractors and its Sub-subcontractors in connection with the Work, all Provisional Sums, and all costs, charges, and expenses of whatever nature necessary for performance of the Work. For the avoidance of doubt, the Contract Price does not include Texas Sales and Use Tax on Equipment (but does include Texas Sales and Use Tax on any purchase, lease or rental
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of Construction Equipment or on any purchase of consumable items (as defined in 34 Tex. Admin. Code Rule §3.291(a)(2)). The Contract Price is separated, in accordance with the definition of “separated contract” as defined in 34 Tex. Admin Code Rule § 3.291(a)(13), as follows:
A.*** U.S. Dollars (U.S. $***) for Equipment of the Project (“Aggregate Equipment Price”). The Aggregate Equipment Price includes the cost of the Equipment, including markup, overhead, freight and profit, but excludes labor.
B.*** U.S. Dollars (U.S. $***) for all Work in this Agreement other than for Equipment (“Aggregate Labor and Skills Price”), which such Work includes all labor, engineering, design services, installation, consumables, Construction Equipment, overhead, profit and all other items of whatever nature applicable to the Work. Excluding only the Aggregate Equipment Price, the Aggregate Labor and Skills Price shall include all costs, charges and expenses of whatever nature applicable to the Work, including Taxes on all Work and Texas Sales and Use Tax on all Work other than on Equipment.
C.The Contract Price, which is separated in Section 7.1A and Section 7.1B above, includes an aggregate amount of *** U.S. Dollars (U.S. $***) for the Provisional Sums (the “Aggregate Provisional Sum”). The Aggregate Provisional Sum is separated into (i) the “Aggregate Provisional Sum Equipment Price” (the total amount of the Aggregate Equipment Price component of the Aggregate Provisional Sum equaling *** U.S. Dollars (U.S. $***)) and (ii) the “Aggregate Provisional Sum Labor and Skills Price” (the total amount of the Aggregate Labor and Skills Price component of the Aggregate Provisional Sum equaling *** U.S. Dollars (U.S. $***)). The scope and values of each Provisional Sum comprising the Aggregate Provisional Sum amount are included in Attachment GG, together with the breakdown between the Aggregate Equipment Prices and all other Work.
D.To the extent that the value of a Provisional Sum exceeds the respective Provisional Sum set forth in Attachment GG, Contractor shall be entitled to a Change Order to increase the Contract Price for such amount. Accordingly, Owner shall be entitled to a Change Order reducing the Contract Price to the extent the value of the Work related to a Provisional Sum is less than the respective Provisional Sum set forth in Attachment GG.
E.The Parties have agreed to adjust the Contract Price based on the fluctuations in the pricing of certain agreed upon commodities as described in Attachment MM. Such adjustments shall follow the procedure set forth in Attachment MM.
7.2Interim Payments.
A.Mobilization Payment. Concurrently with and as a condition precedent to the issuance of the Notice to Proceed in accordance with Section 5.2 and upon Owner’s receipt of an Invoice from Contractor, Owner shall, subject to Owner’s receipt of the Letter of Credit, pay Contractor a fixed amount equal to *** U.S. Dollars (U.S. $***) (the “Mobilization Payment”).
The Mobilization Payment is separated as follows:
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*** U.S. Dollars (U.S. $***) for those components of the Aggregate Equipment Price contained in the Mobilization Payment; and,
*** U.S. Dollars (U.S. $***) for those components of the Aggregate Labor and Skills Price contained in the Mobilization Payment.
B.Payments. With the exception of the Mobilization Payment, payments shall be made by Owner to Contractor in accordance with the Payment Schedule set forth in Attachment C, Schedule C-1 (as may be amended by Change Order), which allocates (i) *** percent (***%) of the Aggregate Labor and Skills Price to be paid based on completion of the Payment Milestones set forth in Attachment C, Schedule C-1, (ii) *** percent (***%) of the Aggregate Labor and Skills Price to be paid based on the Monthly payments set forth in Attachment C, Schedule C-2 (the “Monthly Payments”), as adjusted pursuant to Section 7.2F; and (iii) *** percent (***%) of the Aggregate Equipment Price to be paid based on completion of the Payment Milestones set forth in Attachment C, Schedule C-3. Owner shall also make payments to Contractor for Work performed in accordance with Change Orders to be paid on a time and material basis and any Unilateral Change Orders issued in accordance with Section 6.1E or Section 6.2D). Each payment shall be subject to Owner’s right to withhold payments under this Agreement, as set forth in Section 7.5. Payments shall be made in U.S. Dollars to an account designated by Contractor. The Payment Schedule, including Payment Milestones and Monthly Payments, shall be amended only by Change Order pursuant to this Agreement.
C.Invoices. On the first (1st) Day of each Month (“Month N”), Contractor shall submit to Owner an Invoice, supported by information and documentation required under this Agreement, for the following:
1.amounts for Payment Milestones Contractor plans to fully complete during the next Month (“Month N+1”), as supported by the sixty (60) Day look-ahead schedule submitted with such Invoice. Contractor shall not include any amounts for any Payment Milestones that will only be partially completed at the end of Month N+1;
2.plus the Monthly Payment for Month N+1;

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3.plus (a) allowable costs and expenses Contractor plans to incur during Month N+1 for Work performed in accordance with Change Orders to be paid on a time and material basis, and (b) allowable costs and expenses Contractor plans to incur during Month N+1 for Work covered by a Provisional Sum, all as supported by the sixty (60) Day look-ahead schedule and other information required herein;
4.less amounts for any Payment Milestones Invoiced in Month N-2 that Contractor did not complete during Month N-1; and
5.less amounts Invoiced in Month N-3 for (a) time and material Change Orders, and (b) Provisional Sums that Contractor did not incur in Month N-2.
If Owner pays Contractor for the completion of a Payment Milestone in Month N+1, but Contractor does not complete such Payment Milestone during such Month N+1, and Owner exercises its right to withhold payment in accordance with Section 7.5 for such uncompleted Payment Milestone, Contractor shall not be entitled to Invoice for the amount withheld by Owner for such Payment Milestone until the Month after Contractor completes such Payment Milestone.
Contractor shall include with such Invoice a sixty (60) Day look-ahead schedule, prepared by Contractor, for such Month N and Month N+1 that shows, among other requirements, Contractor’s schedule for (i) completing such Payment Milestones in Month N+1 and (ii) incurring such allowable costs and expenses for time and materials Change Orders and Provisional Sums during such Month N+1. All Invoices issued to Owner hereunder shall separately state charges for the Aggregate Equipment Price and the Aggregate Labor and Skills Price. All Invoices, other than the Invoice for final payment under this Agreement, shall be in the form of Schedule I-1.
D.Interim Lien Waivers. As a condition of payment, each Invoice received by Owner prior to Final Completion shall be accompanied by the following:
1.a fully executed (a) Interim Conditional Lien Waiver from Contractor in the form of Schedule K-1 for all Work performed through the end of the Month preceding the Month of the date of the Invoice (i.e., Month N-1), and (b) Interim Unconditional Lien Waiver from Contractor in the form of Schedule K-2 for all Work performed through the end of the Month preceding the Month of the date of the last Invoice submitted by Contractor of the Invoice (i.e., Month N-2);
2.In addition, as a condition of payment, Contractor shall also provide, subject to Section 7.2D.1 fully executed (a) Interim Conditional Lien Waivers in the form of Schedule K-3 from each Major Subcontractor whose invoice is received by Contractor in the Month covered by Contractor’s Invoice (with each such Interim Conditional Lien Waiver covering all Work performed by each such Major Subcontractor through the end of the Month preceding the Month of the date of such Major Subcontractor’s invoice (i.e., Month N-1); and (b) Interim Unconditional Lien Waivers from each Major Subcontractor in the form of Schedule K-4 for all Work performed by such Major Subcontractor through the end of the Month preceding the Month of the date of each such Major Subcontractor’s preceding invoice (i.e., Month N-2);
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3.fully executed (a) Interim Conditional Lien Waivers in substantially the form of Schedule K-5 from each Major Sub-subcontractor whose invoice is received by Contractor in the Month covered by Contractor’s Invoice or is part of such Contractor’s Invoice (with each such Interim Conditional Lien Waiver covering all Work performed by each such Major Sub-subcontractor through the end of the Month preceding the Month of the date of such Major Sub-subcontractor’s invoice (i.e., Month N-1)); and (b) Interim Unconditional Lien Waivers from each Major Sub-subcontractor in substantially the form set forth in Schedule K-6 for all Work performed by such Major Sub-subcontractor through the end of the Month preceding the Month of the date of each such Major Sub-subcontractor’s preceding invoice (i.e., Month N-2);
4.provided that, if Contractor fails to provide to Owner an Interim Conditional Lien Waiver or Interim Unconditional Lien Waiver from a Major Subcontractor or Major Sub-subcontractor as required in this Section 7.2, Owner’s right to withhold payment for the failure to provide any such Interim Conditional Lien Waiver or Interim Unconditional Lien Waiver shall be limited to the amount that should have been reflected in such Interim Conditional Lien Waiver or Interim Unconditional Lien Waiver; provided further, if Contractor fails to provide an Interim Unconditional Lien Waiver from a Major Subcontractor or Major Sub-subcontractor but Contractor provides evidence to Owner that such Subcontractor or Sub-subcontractor has been paid (as shown in a check that has been properly endorsed and has been paid by the bank on which it is drawn, or evidence the wire transfer payment is received by such Subcontractor or Sub-subcontractor), then Owner shall not withhold payment of such amount. In addition, if and to the extent that Contractor obtains any lien waivers from any Subcontractors or Sub-subcontractors which are not a Major Subcontractor or Major Sub-subcontractor, Contractor shall provide to Owner such lien waivers with the next Invoice following Contractor’s receipt of each such lien waiver. Notwithstanding anything to the contrary in this Section 7.2 and Section 7.4, Contractor shall not be required to deliver a Contractor’s Interim Unconditional Lien Waiver until Owner has paid the amounts requested in the applicable Invoice for which such Contractor’s Interim Unconditional Lien Waiver relates.
5.For Bulk Order Subcontractors only, as a condition of payment, every third (3rd) Invoice received by Owner prior to Final Completion shall be accompanied by fully executed Interim Unconditional Lien Waivers from each Bulk Order Subcontractor in substantially the form set forth in Schedule K-4 for all Work performed by such Bulk Order Subcontractor through the end of the period ending three (3) Months prior to such Invoice (i.e. Month N-3); provided that if Contractor fails to provide to Owner an Interim Unconditional Lien Waiver from a Bulk Order Subcontractor as required in this Section 7.2, Owner’s right to withhold payment for the failure to provide such Interim Unconditional Lien Waiver shall be limited to the amount that should have been reflected in such Interim Unconditional Lien Waiver; provided further, if Contractor fails to provide an Interim Unconditional Lien Waiver from a Bulk Order Subcontractor but Contractor provides an Interim Conditional Lien Waiver (in substantially the form set forth in Schedule K-3 for all Work performed by such Bulk Order Subcontractor) and evidence to Owner that such Subcontractor has been paid (as shown in a check that has
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been properly endorsed and has been paid by the bank on which it is drawn, or evidence the wire transfer payment is received by such Subcontractor), then Owner shall not withhold payment of such amount. Except as provided in the preceding sentence, Bulk Order Subcontractors are not required to provide Interim Conditional Lien Waivers. For the purposes of Interim Conditional Lien Waivers or Interim Unconditional Lien Waivers, Bulk Order Subcontractors shall not be considered Major Subcontractors.
E.Review and Payment. Each Invoice shall be reviewed by Owner and, upon Owner’s reasonable request, Contractor shall furnish such supporting documentation and certificates and provide such further information as may be reasonably requested by Owner. Within thirty (30) Days after receipt of any Invoice, Owner shall provide notice to Contractor of any disputed amount set forth in such Invoice, including an explanation of why such amount is disputed. Unless so disputed by Owner, each Invoice (less any withholdings allowed under this Agreement) shall be due and paid no later than thirty (30) Days after it, and all applicable documentation required under this Agreement, including Attachment I, is received by Owner. If an Invoice is disputed by Owner, then payment shall be made within the thirty (30) Day period for all undisputed amounts and the Dispute shall be resolved pursuant to Article 18. Payment on disputed amounts shall be made as soon as such Dispute is resolved. Without limiting the foregoing, Owner shall not be required to pay, and shall be entitled to withhold payment from Contractor for any amounts otherwise due Contractor, for:
1.any amounts for (a) Payment Milestones Invoiced in Month N-2 that Contractor did not complete during Month N-1, (b) Payment Milestones Invoiced in Month N-1 that Contractor did not complete in Month N, (c) Payment Milestones Invoiced in Month N that Contractor did not complete prior to payment by Owner or is not projected (in accordance with the current sixty (60) Day look-ahead schedule) to complete in Month N+1;
2.any amounts Invoiced in Month N-3 for (a) time and material Change Orders, and (b) Provisional Sums that Contractor did not incur in Month N-2; and
3.any amounts Invoiced in Month N for (a) time and material Change Orders, and (b) Provisional Sums that Contractor has not incurred prior to payment by Owner or is not projected to incur (in accordance with the current sixty (60) Day look-ahead schedule and other required documentation) in Month N+1.
F.Reconciliation of Monthly Payments. If at any time during the course of the Project: (a) the Monthly Progress Reports show that any activity on the critical path is ninety (90) Days or more behind schedule; and (b) Contractor or any of its Subcontractors or Sub-subcontractors are not excused under the terms of this Agreement for such delay, then the date for payment of the last Monthly Payment as shown in the Payment Schedule shall be revised to a later date according to the number of Days that the activity is behind schedule and the remaining Monthly Payments not yet disbursed to Contractor under this Agreement shall be readjusted and spread out proportionately through the remainder of the period, ending upon the revised date for payment of the last Monthly Payment; provided that, in the event that Contractor recovers the delay such that the activity in question ceases to be behind schedule, the Monthly Payments shall
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be recalculated so that such Monthly Payments shall be due in accordance with the original Payment Schedule as of the Contract Date.

7.3Final Completion and Final Payment. Upon Final Completion, Contractor shall, in addition to any other requirements in this Agreement for achieving Final Completion, including those requirements set forth in Article 1 for the definition of Final Completion, submit a fully executed final Invoice in the form attached hereto as Schedule I-2, along with (a) a statement summarizing and reconciling all previous Invoices, payments and Change Orders; (b) an affidavit that all payrolls, Taxes, bills for Equipment, and any other indebtedness connected with the Work, for which Contractor and its Subcontractors and Sub-subcontractors are liable (excluding Corrective Work) have been paid; (c) fully executed Final Conditional Lien Waiver and Final Claim Waiver from Contractor in the form of Schedules K-7 and K-9; (d) fully executed Final Conditional Lien Waivers and Final Claim Waivers from each Major Subcontractor in the form set forth in Schedules K-10 and K-12; and (e) if requested by Owner, fully executed Final Conditional Lien Waivers and Final Claim Waivers from each Major Sub-subcontractor in substantially the form set forth in Schedules K-13 and K-15. No later than thirty (30) Days after receipt by Owner of such final Invoice and all requested documentation and achieving Final Completion, Owner shall, subject to its rights to withhold payment under this Agreement, pay Contractor the balance of the Contract Price, provided that Contractor provides to Owner the following: (x) at the time of such payment, fully executed Final Unconditional Lien Waiver from Contractor in the form of Schedule K-8; and (y) as soon as reasonably possible after the time of such payment, fully executed Final Unconditional Lien Waivers from each Major Subcontractor in the form of Schedule K-11 and each Major Sub-subcontractor in the form of Schedule K-14 provided that the Parties agree that “substantially” means that the same protections shall be provided to Owner as set forth in Attachment K. In addition, if and to the extent that Contractor obtains any final lien or claim waivers from any Subcontractors or Sub-subcontractors which are not a Major Subcontractor or Major Sub-subcontractor, Contractor shall provide to Owner such final lien or claim waivers following Contractor’s receipt of each such lien or claim waiver.
7.4Payments Not Acceptance of Work. No payment made hereunder by Owner shall be considered as approval or acceptance of any Work by Owner or a waiver of any claim or right Owner may have hereunder. All payments shall be subject to correction in subsequent payments.
7.5Payments Withheld. In addition to disputed amounts set forth in an Invoice, Owner may, in addition to any other rights under this Agreement, withhold payment on an Invoice or a portion thereof, or collect on the Letter of Credit, in an amount and to such extent as may be reasonably necessary to protect Owner from loss due to:
A.Defective Work that Contractor is required to correct under Section 12.3, unless Contractor has, within fourteen (14) Days of Owner’s prior written notice given relating to the Defect, either (i) remedied, or commenced to remedy, as applicable, such Defective Work in accordance with Section 12.3 or (ii) if such Defective Work cannot be remedied in accordance with Section 12.3 by the exercise of reasonable diligence within such fourteen (14) Day period, provide Owner with a written plan, reasonably acceptable to Owner, to remedy such Defective Work and commenced the remedy of such Defective Work;
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B.liens, or other encumbrances on all or a portion of the Site, the Work or the Stage 3 Facility, which are filed by any Subcontractor, any Sub-subcontractor or any other Person acting through or under any of them, provided that Owner has made payment to Contractor of all undisputed amounts due to Contractor in accordance with the terms of this Agreement and, unless Contractor has within fourteen (14) Days of Owner’s prior written notice given relating to the lien or other encumbrances, either: (i) paid, satisfied or discharged the applicable liability, (ii) removed the lien or other encumbrance; or (iii) provided Owner with a letter of credit (in addition to the Letter of Credit required under Section 9.2A) or bond reasonably satisfactory to Owner and Lender in the applicable amount;
C.any material breach by Contractor of any term or provision of this Agreement unless Contractor has within fourteen (14) Days of Owner’s prior written notice given relating to the material breach, either (i) cured such breach or (ii) if such breach cannot be cured by the exercise of reasonable diligence within such fourteen (14) Day period, Contractor has commenced corrective action and is diligently exercising all commercially practicable efforts to cure such breach;
D.the assessment of any fines or penalties against Owner as a result of Contractor’s failure to comply with Applicable Law or Applicable Codes and Standards subject to the conditions set forth in Section 17.1F, provided that Owner has first provided Contractor with ten (10) Days prior written notice of its intent to withhold payment;
E.amounts paid by Owner to Contractor in a preceding Month incorrectly, provided that Owner has first provided Contractor with ten (10) Days prior written notice of its intent to withhold payment and Contractor has not, within such ten (10) Days’ notice, repaid such amounts to Owner;
F.Liquidated Damages that Contractor owes under the terms of this Agreement, which shall may be withheld in accordance with Section 13.2;
G.failure of Contractor to make payments to Subcontractors in accordance with their respective Subcontracts, provided that Owner has first provided Contractor with ten (10) Days prior written notice of its intent to withhold payment and Contractor has not, within such ten (10) Days’ notice, cured such failure, provided further that Owner has made payment to Contractor of all undisputed amounts owed to Contractor in accordance with the terms of this Agreement; and
H.any other costs or liabilities which Owner has incurred for which Contractor is responsible under this Agreement, provided that Owner has first provided Contractor with ten (10) Days prior written notice of its intent to withhold payment.
Notwithstanding the foregoing, (i) should any payment under any Invoice become due before the expiration of any notice period specified in this Section 7.5, Owner shall nevertheless be entitled to withhold from such Invoice amounts equal to the amounts specified in Owner’s notice, but Owner shall promptly pay such withheld amounts to Contractor if Contractor cures the cause for such withholding or offset, and (ii) no notice is required in the event Contractor is insolvent, has a receiver appointed, makes a general assignment or filing for the benefit of its creditors or files for bankruptcy protection.
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7.6Payment of Amounts Withheld or Collected on Letter of Credit. Prior to drawing down or collecting on the Letter of Credit in accordance with this Agreement, Owner shall provide Contractor with the written notice in accordance with Section 9.2A. For amounts actually withheld or collected on the Letter of Credit, Owner shall pay Contractor the amount Owner withheld or collected on the Letter of Credit under Section 7.5 as soon as practicable, but in no event later than fifteen (15) Business Days after Owner’s receipt of an Invoice from Contractor, if Contractor, as appropriate (a) pays, satisfies or discharges the applicable liability and provides Owner with reasonable evidence of such payment, satisfaction or discharge, (b) cures the applicable breach described in Section 7.5C or the applicable Default (i.e., the breach described in Section 7.5C or Default on which Owner’s withholding or collection on the Letter of Credit was based), (c) with respect to item 7.5B, removes the lien or other encumbrance in question in accordance with Applicable Law, (d) remedies the Defective Work in question, or (v) provides Owner with a letter of credit reasonably satisfactory to Owner in the amount of the withheld payment. In the event Owner draws down or collects any amount on the Letter of Credit pursuant to this Section 7.6, and Contractor acts in accordance with either (a), (b) or (c) above so as to require payment from Owner, Contractor shall, within seven (7) Days after Owner’s payment to Contractor, restore the Letter of Credit to the amount the Letter of Credit had immediately prior to Owner’s collection on the Letter of Credit under this Section 7.6, failing which, Owner may withhold all payments otherwise due Contractor until Contractor so restores such Letter of Credit. Owner’s failure to withhold or draw down or collect against the Letter of Credit in the event of any of the circumstances described in Section 7.5 shall not be deemed to be a waiver of any of Owner’s rights under this Agreement, including Owner’s right to withhold or draw down on the Letter of Credit at any time one of the circumstances in Section 7.5 exists.
7.7Interest on Late Payments. Any undisputed amounts due but not paid when such amounts are due and payable hereunder, any amounts withheld from Contractor but later finally determined in accordance with the dispute resolution procedure set forth in Article 18 to have been improperly withheld, or any amounts collected by Owner on the Letter of Credit but later finally determined in accordance with the dispute resolution procedure set forth in Article 18 to have been improperly collected, shall bear interest at the lesser of (a) an annual rate equal to the prime rate published by the Wall Street Journal on the date such amounts were due and payable plus three percent (3%), or (b) the maximum rate permitted under Applicable Law.




7.8Offset. Owner may, upon ten (10) Days’ prior notice to Contractor, offset any debt due and payable from Contractor to Owner under this Agreement against any amount due and payable to Contractor hereunder.
7.9Currency. All amounts contained herein are in and shall be paid in U.S. Dollars; provided that any Equipment expenses incurred by Contractor in a currency other than U.S. Dollars that were purchased pursuant to a Unilateral Change Order issued under Section 6.1E or 6.2D herein shall be
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converted to U.S. Dollars using the applicable daily currency rate specified in the Wall Street Journal at the time at which Contractor incurred such expense before being invoiced to Owner, and such Invoice shall provide documentation showing such currency conversion.
7.10Currency Conversion. All amounts contained herein are in and shall be paid in U.S. Dollars. Included in the Contract Price are the following amounts in U.S. Dollars based upon the following foreign (non-U.S. Dollar) currencies at the following exchange rates to the U.S. Dollar:
Foreign CurrencyValue of Foreign CurrencyInitial Exchange RateInitial Equivalent U.S. Dollar Value
Euro€****** USD to EuroU.S. $***
On a date that is two (2) Business Days after Owner’s issuance of NTP, the Contract Price shall be subject to an upward or downward adjustment by Change Order to account for currency fluctuations. The EURO adjustment will be determined no later than two banking days after NTP by multiplying (a) the difference of the Contractor actual secured hedge rate (“Bechtel Treasury Secured Hedge Rate”) and the above listed exchange rate (“Contract Exchange Rate”) by (b) the corresponding value in EURO listed above (“Value of Foreign Currency”). The Bechtel Treasury Secured Hedge Rate will be determined by taking a weighted average of the forward contracts entered into by Contractor and any spot contracts entered into by Contractor during the period between LNTP and NTP.
The Contract Price adjustment shall be the sum of the adjustments for each currency and shall be stated in U.S. Dollars and calculated as follows:
Adjustment = [Value of Foreign Currency x [Bechtel Treasury Secured Hedge Rate – Contract Exchange Rate]]
Five (5) Days after Owner’s issuance of the NTP, Contractor assumes all risk relating to fluctuation of any foreign currency. Promptly after issuance of NTP, the Parties shall enter into a Change Order reflecting the adjustment to the Contract Price for currency fluctuation as set forth above.
7.11Fuel Adjustment. Included in the Contract Price is a sum of *** U.S. Dollars (U.S. $***) (“Fuel Adjustment Basis”) for price fluctuation in the cost of gasoline and diesel fuels to be used during construction, commissioning, and start-up of the Stage 3 Facility. The baseline index value from each of the selected indices is as of the week ending ***:
Figure 1
FUEL TYPEVALUE IN ESTIMATE*BASELINE INDEX VALUE
GasolineU.S. $******
DieselU.S. $******
* Estimate refers to the Fuel Adjustment Basis, which is based on the estimated quantities.
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On the date Owner issues the NTP, the Contract Price shall be subject to an upward or downward adjustment by Change Order for each of the following fuel types: (a) gasoline and (b) road diesel listed above for any change in the index value, at the nearest weekly datum, as published by the *** for the Gulf Coast Region for each specific fuel type (See Figure 2). The adjustment for each fuel type will be determined by subtracting the baseline index value from the corresponding NTP index value (which is the index value on the date of NTP) and then dividing that result by the baseline index value and multiplying the result by the value in Fuel Adjustment Basis for each of the fuel types listed in Figure 1. For clarity:
adjustmentformula.jpg
The indices are as follows for the specific fuel types:
FUELINDEX
GasolineUS EIA Weekly Gulf Coast Regular All Formulations Retail Gasoline Prices
DieselUS EIA Weekly Gulf Coast No 2 Diesel Retail Prices
For avoidance of doubt, Contractor bears the risk of determining the correct quantity of fuel for the Work as of the Contract Date, and this Section 7.11 shall not entitle Contractor to any Contract Price adjustments on account of increases in the actual fuel quantity used for the Work as of the Contract Date.
7.12Conditions Precedent to Payment. It shall be a condition precedent to Contractor’s entitlement to receive any payment from Owner under this Agreement that Contractor has provided to Owner, and is maintaining, the (a) Parent Guarantee in accordance with Section 21.17, and (b) insurance policies in accordance with Section 9.1. Except for sums due and owing for LNTP Work (if any), Contractor shall also not be entitled to any compensation under this Agreement unless and until Contractor provides the Letter of Credit to Owner in accordance with Section 9.2.


7.13Relief for Non-U.S. Duties and Tariffs.

A.As of the Agreement Date, all Non-U.S. Duties and Tariffs are included in the Contract Price.
B.Additionally, included in the Contract Price is a Provisional Sum for Changes in Non-U.S. Duties and Tariffs that occur after the Agreement Date (“Non-U.S. Duties and Tariffs Provisional Sum”). The Non-U.S. Duties and Tariffs Provisional Sum may only be adjusted by Change Order as described in this Section 7.13 and the amount is set forth in Section 2 of Attachment GG. If there are Changes in Non-U.S. Duties and Tariffs that occur in a Major
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Subcontract after the Agreement Date but prior to execution of such Major Subcontract that would result in an increase in the price of such Major Subcontract, then at least ten (10) Business Days prior to Contractor’s execution of such Major Subcontract, Contractor shall provide written notice and supporting documentation to Owner of the amount of the Changes in Non-U.S. Duties and Tariffs associated with such Major Subcontract. Then Owner may request that Contractor consider other potential subcontractors where the duties and tariff costs may be lower, provided that (a) Contractor can procure such Equipment from such substitute subcontractor of substantially the same or greater quality; (b) there is no adverse impact to the Project Schedule; (c) Contractor has not had verifiable negative experience with the substitute subcontractor; (d) substitute subcontractor has the requisite technical and professional qualifications; (e) there are no verifiable reputational or ethical concerns with the substitute subcontractor; and (f) substitute subcontractor is in good financial standing and not at risk for a change of control that would materially and adversely impact its financial condition or any other condition in (a) through (e) in this sentence. If Contractor, after making commercially reasonable efforts, is unable to find a substitute subcontractor meeting the requirements of this Section 7.13B for that Major Subcontractor and which also is approved by Owner in writing, then Contractor may execute the Major Subcontract with such Major Subcontractor. Contractor shall also notify Owner in writing of any decreases in the pricing of a Major Subcontract that may occur prior to executing such Major Subcontract as a result of decreases or removal of Non-U.S. Duties and Tariffs in such Major Subcontract. All changes to the Contract Price as a result shall be accounted for prior to Final Completion pursuant to Section 7.13D.
C.If (i) there is a Change in the Non-U.S. Duties and Tariffs for a Major Subcontractor that occurs after Contractor’s execution of the applicable Major Subcontract which causes an increase to the price of such Major Subcontract, (ii) Contractor provides written notice to Owner of this Change in Non-U.S. Duties and Tariffs and (iii) Contractor provides evidence of an increase to such Non-U.S. Duties and Tariffs, then Contractor shall be entitled to a Change Order increasing the Contract Price for such amount (with a corresponding additional increase of *** percent (***%) of such amount) to the extent permitted in Section 7.13D. Similarly, if there is a Change in the Non-U.S. Duties and Tariffs for a Major Subcontractor that occurs after Contractor’s execution of the applicable Major Subcontract that causes a reduction in the price of a Major Subcontract after Contractor’s execution of the applicable Major Subcontract, then Owner shall be entitled to a reduction to the Contract Price equivalent to such amount (with a corresponding additional reduction of *** percent (***%) of such amount) to the extent permitted in Section 7.13D. All such increases or decreases shall be accounted for prior to Final Completion pursuant to Section 7.13D.
D.Within thirty (30) Days prior to Final Completion (and at any other time mutually agreed to by the Parties in writing), Contractor shall inform Owner in writing of the cumulative Changes in Non-U.S. Duties and Tariffs under the Agreement pursuant to Section 7.13B and 7.13C above (the “Cumulative Changes in Non-U.S. Duties and Tariffs”). If the Cumulative Changes in Non-U.S. Duties and Tariffs at that point in time is less than the Non-U.S. Duties and Tariffs Provisional Sum, Owner shall be entitled to a Change Order reducing the Contract Price by such difference (with a corresponding reduction of *** percent (***%) of such difference). Similarly, if the Cumulative Changes in Non-U.S. Duties and Tariffs is greater than the Non-U.S. Duties and Tariffs Provisional Sum, Contractor shall be entitled to a Change Order increasing the
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Contract Price by such difference (with a corresponding increase of *** percent (***%) of such difference).
ARTICLE 8
TITLE AND RISK OF LOSS
8.1Title.
A.Clear Title. Contractor warrants and guarantees that Owner will receive good and legal title to and ownership of the Work and the Stage 3 Facility, free and clear of any and all liens, claims, security interests or other encumbrances when title thereto passes to Owner.
B.Title to Work. Title to all or any portion of the Work (other than Work Product) shall pass to Owner (or its designee) upon the earlier of (i) payment by Owner therefor, or (ii) delivery of the Work to the Land, provided that Work Product shall pass in accordance with Section 10.1. Transfer of title to Work shall be without prejudice to Owner’s right to reject Defective Work, or any other right in this Agreement.
8.2Risk of Loss.
A.Before Substantial Completion. Notwithstanding passage of title as provided in Section 8.1, Contractor shall bear the risk of physical loss and damage to the Stage 3 Facility and each component thereof (including all Equipment, whether or not yet delivered to the Site or incorporated into the Stage 3 Facility) as follows until the earlier termination of the Agreement or: (i) with respect to the Train 1 Work, Contractor shall bear the risk of physical loss and damage until Substantial Completion of Train 1 is achieved, (ii) with respect to the Train 2 Work, Contractor shall bear the risk of physical loss and damage until Substantial Completion of Train 2 is achieved, (iii) with respect to the Train 3 Work, Contractor shall bear the risk of physical loss and damage until Substantial Completion of Train 3 is achieved; (iv) with respect to the Train 4 Work, Contractor shall bear the risk of physical loss and damage until Substantial Completion of Train 4 is achieved, (v) with respect to the Train 5 Work, Contractor shall bear the risk of physical loss and damage until Substantial Completion of Train 5 is achieved, (vi) with respect to the Train 6 Work, Contractor shall bear the risk of physical loss and damage until Substantial Completion of Train 6 is achieved and, with respect to the Train 7 Work, Contractor shall bear the risk of physical loss and damage until Substantial Completion of Train 7 is achieved; provided that Owner shall at all times bear the risk of physical loss and damage to the extent arising from (1) war (whether declared or undeclared), civil war, act of terrorism, sabotage, blockade, insurrection; (2) ionizing radiation, or contamination by radioactivity from nuclear fuel, or from any nuclear waste from the combustion of nuclear fuel properties of any explosive nuclear assembly or nuclear component thereof; (3) loss or damage resulting from a cyber event that is excluded from coverage pursuant to Contractor’s Builder’s Risk or Marine Cargo policies; or (4) an atmospheric disturbance marked by high winds, with or without precipitation, including such events as hurricane, typhoon, monsoon, cyclone, rainstorm, tempest, hailstorm, tornado, or any combination of the foregoing events, including any resulting flood, tidal or wave action (collectively, “Windstorms”) and earthquake to the extent that such Windstorms and earthquakes result in loss or damage in excess of Contractor’s insurance for
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such Windstorms and earthquakes as obtained in accordance with Section 1.A(9)e of Attachment O, which, subject to Section 9.1F, shall be the greater of (a) *** U.S. Dollars (U.S. $***) and (b) the 250-year return period loss during critical phases as determined by a loss study performed by Contractor’s broker, in the cumulative aggregate with respect to the Work, the Project, the Trains and the Stage 3 Facility (or such greater amount obtained in the Builder’s Risk policy) ((1)-(4) collectively “Excepted Risks”).
B.After Substantial Completion. Upon the earlier of: (a) the termination of the Agreement, Owner shall bear risk of physical loss and damage to the Stage 3 Facility; (b) Substantial Completion of each Train, Owner shall bear risk of physical loss and damage to such Train; or (c) the transfer by Contractor to Owner of a portion of the Stage 3 Facility transferred to Owner in accordance with Section 11.7, Owner shall bear the risk of physical loss and damage to such portion of the Stage 3 Facility. In accordance with Section 17.1I, Contractor shall be liable to Owner for physical loss and damage to any portion of a Train after such Train achieves Substantial Completion to the extent such physical loss and damage arises out of or results from or is related to the negligence or fault of any Contractor Group or Subcontractors or Sub-subcontractors, subject to a cap in liability of *** U.S. Dollars (U.S. $***) per occurrence.
C.This Section 8.2 shall not be interpreted to relieve Contractor of any of its obligations under this Agreement with respect to Warranties, Defective Work, Corrective Work, and the deductibles under the Builder’s Risk insurance specified in this Agreement.
D.With respect to any physical loss or physical damage to a Train (including Equipment or Work incorporated into such Train) caused by (1) Force Majeure (including any Excepted Risks); (2) any member of Owner Group or any other Person for whom Owner is responsible, or (3) any third party over whom neither Contractor nor Owner are responsible and such third party is beyond the reasonable control of Contractor and such loss or damage was not due to Contractor’s fault or negligence and could not have been prevented or avoided by Contractor through the exercise of due diligence, Contractor shall be entitled to a Change Order adjusting the Guaranteed Dates if and to the extent permitted under (y) Section 6.7 if caused by Force Majeure (including any of the events listed in Section 8.2A (1), (2), or (3)), and (z) Section 6.8 if caused by any member of Owner Group or any other Person for whom Owner is responsible or a third party pursuant to Section 8.2D (3) above. In the event that any physical loss or damage to a Train (or any Equipment or Work incorporated or to be incorporated in such Train) arises from an Excepted Risk, and Owner elects to rebuild such physical loss or damage, Contractor shall be entitled to a Change Order to adjust the Contract Price to the extent such event adversely affects Contractor’s costs of performance of the Work, provided that Contractor complies with the requirements in Section 6.5 and the mitigation requirements in Section 6.11.
E.For the avoidance of doubt, this Section 8.2 shall apply to any loss or damage to the Work caused by, arising out of or resulting from, any activities, events or omissions occurring in connection with this Agreement. Similarly for the avoidance of doubt, the risk of loss and damage to the Stage 1 Liquefaction Facility, Stage 2 Liquefaction Facility shall be determined in accordance with Section 8.2 of the Stage 1 EPC Agreement or Stage 2 EPC Agreement, notwithstanding that such loss or damage to the Stage 1 Liquefaction Facility or
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Stage 2 Liquefaction Facility was caused by, arose out of or resulted from activities or events occurring during the performance of this Agreement.
ARTICLE 9
INSURANCE AND LETTER OF CREDIT
9.1Insurance. Provision of Insurance. Each Party shall provide the insurance required of it as specified in Attachment O in accordance with the terms and conditions stated therein.
B.No Cancellation. All policies providing coverage hereunder shall contain a provision that at least thirty (30) Days’ prior notice shall be given to the non-procuring Parties and additional insureds prior to cancellation, non-renewal or material change in the coverage.
C.Additional Insurance. Upon Owner’s request, and at Owner’s sole option, Contractor shall increase its insurance required under this Agreement (as long as such insurance coverage is available in the commercial insurance market); provided however, that the payment of any incremental increase in the cost of such insurance shall be reimbursed by Owner at cost via Change Order.
D.Obligations Not Relieved. Anything in this Agreement to the contrary notwithstanding, the occurrence of any of the following shall in no way relieve Contractor from any of its obligations under this Agreement: (i) failure by Contractor to secure or maintain the insurance coverage required hereunder; (ii) failure by Contractor to comply fully with any of the insurance provisions of this Agreement; (iii) failure by Contractor to secure such endorsements on the policies as may be necessary to carry out the terms and provisions of this Agreement; (iv) the insolvency, bankruptcy or failure of any insurance company providing insurance to Contractor; (v) failure of any insurance company to pay any claim accruing under Contractor’s policy; or (vi) losses by Contractor or any of its Subcontractors or Sub-subcontractors not covered by insurance policies required to be provided by Contractor.
E.Failure to Provide Required Insurance. In the event that liability for any loss or damage is denied by the underwriter or underwriters in whole or in part due to the breach by Contractor of insurance required to be provided by Contractor, or if Contractor fails to maintain any of the Contractor’s insurance herein required, then Contractor shall defend, indemnify and hold harmless any and all members of the Owner Group against all losses which would otherwise have been covered by said insurance.
F.Unavailable Insurance. If any insurance (including the limits or deductibles thereof) hereby required to be maintained, other than insurance required by Applicable Law to be maintained, shall not be reasonably available in the commercial insurance market, Owner and Contractor shall not unreasonably withhold their agreement to waive such requirement to the extent that maintenance thereof is not so available; provided, however, that the Party shall first request any such waiver in writing from the other Party, which request shall be accompanied by written reports prepared by two (2) independent advisors, including insurance brokers, of recognized international standing certifying that such insurance is not reasonably available in the commercial insurance market (and, in any case where the required amount is not so available, explaining in detail the basis for such conclusions), such insurance advisers and the form and
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substance of such reports to be reasonably acceptable to the other Party. Any such waiver shall be effective only so long as such insurance shall not be available and commercially feasible in the commercial insurance market.
9.2Irrevocable Standby Letter of Credit.
A.Concurrently with the issuance of NTP, Contractor shall provide to Owner an irrevocable standby, on-demand letter of credit, naming Owner as beneficiary, in the amount of *** percent (***%) of the Contract Price (as adjusted by Change Order) and in the form of Attachment R, and issued or confirmed by a commercial bank in the United States of America with a rating of at least Investment Grade (“Letter of Credit”). Upon Owner’s written request, Contractor shall increase the dollar value of the Letter of Credit issued to Owner in proportion to any increases to the Contract Price pursuant to a Change Order, or the aggregate of multiple Change Orders, that equal or exceed *** U.S. Dollars (U.S. $***); provided that if Owner so requests an adjustment to the value of the Letter of Credit, Contractor shall be entitled to a Change Order for the cost of the increase in the Letter of Credit. If at any time the rating of the U.S. commercial bank that issued the Letter of Credit falls below Investment Grade, Contractor shall replace the Letter of Credit within ten (10) Days with an equivalent letter of credit, issued by a commercial bank in the United States of America reasonably acceptable to Owner meeting such rating requirements and meeting the requirements of this Section 9.2 or, if permitted by Owner in its sole discretion, an equivalent instrument. Owner shall have the right to draw down on or collect against such Letter of Credit upon Owner’s demand in the event of the following: (1) a Default by Contractor or the owing by Contractor to Owner under this Agreement for Liquidated Damages or any other liabilities, damages, costs, losses or expenses arising out of or relating to a breach of any obligation under this Agreement by Contractor or such Default; and (2) Owner has provided Contractor with seven (7) Business Days’ written notice (except in the event of Contractor’s bankruptcy, in which event, no such notice is required) (a) specifying the nature of such Default or the owing by Contractor to Owner under this Agreement for Liquidated Damages or any other liabilities, damages, costs, losses or expenses arising out of or relating to a breach of any obligation under this Agreement by Contractor and (b) stating Owner’s intent to draw against the Letter of Credit and the amount to be drawn. The amount drawn on the Letter of Credit shall not be greater than the amount that Owner, at the time of the drawing, reasonably estimates is owed it under this Agreement for Liquidated Damages, liabilities, damages, costs, losses or expenses or is necessary to remedy the Default or breach of this Agreement. In addition to the foregoing draw rights, (i) Owner shall also have the right to draw down on or collect against the Letter of Credit for all remaining funds in the Letter of Credit upon Owner’s demand if Contractor has not, prior to thirty (30) Days before the then current expiration date, delivered to Owner a replacement letter of credit substantially identical to the Letter of Credit and from a U.S. commercial bank meeting the requirements in this Section 9.2 and extending the expiration date for the shorter of (a) a period of one (1) year or (b) the expiration of the period specified in clause (viii) of the definition of “Defect Correction Period” (i.e., the eighteen (18) month period following Substantial Completion of Train 7 and any extension pursuant to Section 12.3C, if applicable), and (ii) Owner shall also have the right to draw down on or collect against the Letter of Credit for all remaining funds available under such Letter of Credit upon Owner’s demand if the issuing bank is no longer Investment Grade and Contractor has not, within the applicable time period set forth in this Section 9.2, delivered to Owner a replacement letter of
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credit substantially identical to the Letter of Credit from a U.S. commercial bank meeting the requirements set forth in this Section 9.2. Contractor is not entitled to any compensation under this Agreement (other than for any compensation owed under an LNTP) unless and until Contractor provides the Letter of Credit to Owner in accordance with this Section 9.2.
B.The amount of the Letter of Credit shall decrease to an aggregate amount equal to:
1.*** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice that (a) Substantial Completion of Train 1 has occurred (including Contractor’s payment to Owner of all Delay Liquidated Damages due and owing under this Agreement for Train 1), and (b) Contractor has achieved the Performance Guarantees for Train 1 or paid to Owner all Train 1 Performance Liquidated Damages due and owing;
2.provided that the conditions of clauses (a) and (b) of Section 9.2B.1 have occurred, *** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice that (a) Substantial Completion of Train 2 has occurred (including Contractor’s payment to Owner of all Delay Liquidated Damages due and owing under this Agreement for Train 2), and (b) Contractor has achieved the Performance Guarantees for Train 2 or paid to Owner all Train 2 Performance Liquidated Damages due and owing;
3.provided that the conditions of clauses (a) and (b) of Section 9.2B.2 have occurred, *** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice that (a) Substantial Completion of Train 3 has occurred (including Contractor’s payment to Owner of all Delay Liquidated Damages due and owing under this Agreement for Train 3), and (b) Contractor has achieved the Performance Guarantees for Train 3 or paid to Owner all Train 3 Performance Liquidated Damages due and owing;
4.provided that the conditions of clauses (a) and (b) of Section 9.2B.3 have occurred, *** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice that (a) Substantial Completion of Train 4 has occurred (including Contractor’s payment to Owner of all Delay Liquidated Damages due and owing under this Agreement for Train 4), and (b) Contractor has achieved the Performance Guarantees for Train 4 or paid to Owner all Train 4 Performance Liquidated Damages due and owing;
5.provided that the conditions of clauses (a) and (b) of Section 9.2B.4 have occurred, *** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice that (a) Substantial Completion of Train 5 has occurred (including Contractor’s payment to Owner of all Delay Liquidated Damages due and owing under this Agreement for Train 5), and (b) Contractor has achieved the Performance Guarantees for Train 5 or paid to Owner all Train 5 Performance Liquidated Damages due and owing;
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6.provided that the conditions of clauses (a) and (b) of Section 9.2B.5 have occurred, *** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice that (a) Substantial Completion of Train 6 has occurred (including Contractor’s payment to Owner of all Delay Liquidated Damages due and owing under this Agreement for Train 6), and (b) Contractor has achieved the Performance Guarantees for Train 6 or paid to Owner all Train 6 Performance Liquidated Damages due and owing;
7.provided that the conditions of clauses (a) and (b) of Section 9.2B.6 have occurred, *** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice that (a) Substantial Completion of Train 7 has occurred (including Contractor’s payment to Owner of all Delay Liquidated Damages due and owing under this Agreement for Train 7), and (b) Contractor has achieved the Performance Guarantees for Train 7 or paid to Owner all Train 7 Performance Liquidated Damages due and owing;
8.provided that the conditions of Section 9.2B7 have occurred and if the Defect Correction Period has been extended for any Work pursuant to Section 12.3C, *** percent (***%) of the Contract Price upon the commercial bank’s receipt from Owner of a written notice (i) of the expiration of the period specified in clause (viii) of the definition of “Defect Correction Period” (i.e., the eighteen (18) month period following Substantial Completion of Train 7, and (ii) that the Defect Correction Period has been extended pursuant to Section 12.3C); and
9.provided that the conditions of Section 9.2B7 have occurred and (a) if the Defect Correction Period has not been extended for any Work pursuant to Section 12.3C or (b) if the Defect Correction Period has been extended for any Work pursuant to Section 12.3C and such extension has expired, *** percent (***%) of the Contract Price upon the issuing commercial bank’s receipt from Owner of a written notice of the expiration of the period specified in clause (viii) of the definition of “Defect Correction Period” (i.e., the eighteen (18) month period following Substantial Completion of Train 7 plus (if applicable) the expiration of any extensions to this eighteen (18) month period pursuant to Section 12.3C of the Agreement) and provided further that no existing claims of Owner under this Agreement remain unresolved.
C.The Letter of Credit shall remain in full force and effect without any lapse whatsoever in the amounts specified in Section 9.2B from the issuance of the Letter of Credit through the expiration of the period specified in clause (viii) of the definition of “Defect Correction Period” (i.e., the eighteen (18) month period following Substantial Completion of Train 7 and any extension of the Defects Correction Period pursuant to Section 12.3C, if any) in accordance with Section 9.2B.9. Partial drawings are permitted under the Letter of Credit.
D.No later than thirty (30) Days after the satisfaction of any of the conditions listed in Section 9.2B above, Owner shall provide the commercial bank that issued the Letter of Credit with the written notice as specified in that particular section. No later than thirty (30) Days after expiration of the eighteen (18) month Defect Correction Period for Train 7 (as may be extended
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pursuant to Section 12.3C), Owner shall provide the commercial bank that issued Letter of Credit with written notice of the expiration of such period pursuant to Section 9.2B.8 or 9.2B.9, as applicable. Owner shall copy Contractor on the notices provided to the commercial bank described in Section 9.2B.
E.The Letter of Credit may only be transferred by Owner to a permitted assignee of this Agreement. Owner may for the purpose of providing collateral, assign, pledge and/or grant a security interest in the Letter of Credit to any Lender without Contractor’s consent by providing notice to Contractor.
ARTICLE 10
OWNERSHIP OF DOCUMENTATION
10.1Ownership of Work Product. Owner and Contractor acknowledge that during the course of, and as a result of, the performance of the Work and prior work related to the Stage 3 Facility done by Contractor for Owner (including any work done by Contractor or any of its Affiliates or their subcontractors under the FEED Verification Agreement), Contractor or its Affiliates, Subcontractors or Sub-subcontractors will create or have created for the Project and will issue to Owner certain written materials, plans, Drawings (including P&IDs), Specifications, or other tangible results of performance of the Work (hereinafter individually or collectively referred to as “Work Product”). Subject to Section 10.2 and the use restriction set forth in Sections 10.6, all rights, title and interest to the Work Product, including any and all copyrights in the Work Product, shall be owned by Owner, as and when such Work Product is created, irrespective of any copyright notices or confidentiality legends to the contrary which may have been placed in or on such Work Product by Contractor, its Affiliates, Subcontractors, Sub-Subcontractors or any other Person. If, for any reason, ownership of all right, title and interest in the Work Product shall not otherwise vest in Owner, then Contractor agrees, subject to Section 10.2 and the use restriction set forth in Sections 10.6, that such ownership and copyrights in the Work Product, whether or not such Work Product is fully or partially complete, shall be automatically assigned from Contractor to Owner without further consideration, and Owner shall thereafter own all right, title and interest in the Work Product, including all copyright interests.
10.2Contractor’s Intellectual Property and Third Party Intellectual Property. As between Owner and Contractor, Contractor shall retain ownership of all rights, title and interest to any and all intellectual property (excluding any copyrights in the Work Product) owned by Contractor or developed by Contractor under this Agreement (including all patents and applications therefor, all inventions, trade secrets, know-how, technology, technical data, customer lists, copyrights and all registrations and applications therefor, and all industrial designs, and any written materials, plans, drafts, specifications, calculations or computer files or other documents, owned by Contractor or its Affiliates prior to the Agreement Date or developed or acquired by Contractor or its Affiliates independently of this Agreement) (hereinafter referred to as “Contractor’s Intellectual Property”), regardless of whether such Contractor’s Intellectual Property is included in the Work Product, and nothing in this Section 10.2 shall result in a transfer of ownership of any Contractor’s Intellectual Property or the proprietary intellectual property owned or developed by Subcontractors or Sub-subcontractors (“Third Party Intellectual Property”). With respect to such Contractor’s Intellectual Property and Third Party Intellectual Property, Contractor hereby grants to Owner, as and when the Work Product is created, an irrevocable, perpetual, non-exclusive and royalty-free license (including with right to assign such license
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without consent to any purchaser of an interest in all or part of the Stage 3 Facility provided that such assignee shall only be entitled to use the Work Product, and the Contractor Intellectual Property and Third Party Intellectual Property which is embedded in the Work Product, for the purposes specified in clauses (a) through (e) below, which license and sublicense shall in all respects remain limited by and subject to the terms of this Agreement) to use, modify (subject to this Section 10.2) and copy such Contractor’s Intellectual Property and Third Party Intellectual Property to the extent the same is incorporated into the Work Product for the Stage 3 Facility to (a) engineer, procure, construct, pre-commission, commission, startup and test the Stage 3 Facility; (b) operate and maintain the Stage 3 Facility; (c) train operators for the Stage 3 Facility; (d) repair, replace, expand, complete or modify any part of the Stage 3 Facility, provided that such repair, replacement, expansion, completion or modification shall not include the addition of additional liquefaction trains beyond a seven (7) train facility (e.g., trains other than Train 1, Train 2, Train 3, Train 4, Train 5, Train 6 and Train 7); and (e) modify, improve, adapt, copy, and prepare derivative work from the Work Product for use in connection with the Stage 3 Facility for the purposes specified in clauses (a) through (e) above, provided that Owner shall first remove, or cause to be removed, all references to Contractor from the Work Product in the event such Work Product is provided to another contractor. In addition, with respect to any trains at or near the Site (beyond Train 1 through Train 7) or for any other project or facility anywhere in the world, Contractor hereby grants to Owner an irrevocable, perpetual, non-exclusive and royalty-free license to Contractor’s Intellectual Property and Third Party Intellectual Property (to the extent that, with respect to such Third Party Intellectual Property, Owner has such license from the applicable owners of such Third Party Intellectual Property that were not a subcontractor to Contractor under the FEED Verification Agreement) in each case that is embedded in the FEED Package (including with right to assign such license without consent to Owner or any Affiliate of Owner provided that such assignee shall only be entitled to use the Contractor Intellectual Property and Third Party Intellectual Property to the extent that, with respect to such Third Party Intellectual Property, Owner has such right from the applicable owners of such Third Party Intellectual Property that were not a subcontractor to Contractor under the FEED Verification Agreement) for the purpose of engineering, procurement, construction, pre-commissioning, start-up and testing of such trains, which license and sublicense shall in all respects remain limited by and subject to the terms of this Agreement. Notwithstanding the foregoing, with respect to the use of the Work Product for additional trains at or nearby the Site or at any other location in the world, the license described above under shall not apply to the Excluded Documents. “Excluded Documents” are defined as Contractor’s pricing information. All Subcontracts and Sub-subcontracts shall contain provisions consistent with this Section 10.2, except as provided in Section 10.6. Notwithstanding anything to the contrary in this Agreement, no license is granted to Owner with respect to the use of any of Contractor’s proprietary software or systems, except to the extent such software or systems are incorporated into the Stage 3 Facility. Notwithstanding the foregoing, if Owner (A) uses the Feed Package for any trains at or near the site (beyond Trains 1 through 7) or for any other project or facility anywhere in the world, (B) uses any Work Product for purposes other than those permitted in this Article 10, or (C) modifies any Work Product, in each case without the prior written consent or involvement of any member of Contractor Group and Subcontractor or Sub-subcontractor (where applicable to the Work Product used or modified), Owner shall defend, indemnify and hold the Contractor Group harmless from and against all damages, losses, costs and expenses (including all reasonable attorneys’ fees and litigation or arbitration expenses) incurred by any member of the Contractor Group or a Subcontractor or Sub-subcontractor that arise from such use. Likewise, if Owner modifies the Work Product without the involvement of Contractor and its Subcontractors or Sub-
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subcontractors (where applicable to the Work Product modified), and such modifications to the Work Product infringe upon the Intellectual property Rights of a third party, Owner shall indemnify, defend and hold harmless Contractor Group, its Subcontractors and Sub-subcontractors with respect to any claims, Damages, losses, liabilities or other causes of action brought by such third party arising from such modification.
10.3Limitations on Use of Work Product. The Work Product, including all copies thereof, shall not be used by Contractor, its Affiliates or its Subcontractors, Sub-subcontractors or any other Persons on any other project for a Person other than Owner without first removing all information provided in Section 10.4, all Owner’s Confidential Information in Section 19.1 and any other information identifying Owner, the Project, the Stage 3 Facility or the Site. Pursuant to the requirements of this Section 10.3, Owner grants Contractor an irrevocable, perpetual and royalty-free license to use, modify and copy the Work Product for any other project, except for any of the following which may be in such Work Product: (a) any proprietary intellectual property rights owned by Owner or any Affiliate of Owner (other than Owner’s right to the copyright in the actual Work Product itself provided in Section 10.1) or (b) any proprietary intellectual property rights in which Owner or an Affiliate of Owner has a license unless Contractor also has a license to such proprietary intellectual property. The foregoing license and rights to use any Work Product granted to Contractor shall be subject to any limitations imposed on Contractor by third parties which have any ownership interest in such Work Product or any proprietary intellectual property embedded therein.




10.4Owner Provided Documents. Owner represents that it owns or has a license to the information, data and documentation referenced within Attachment M of the FEED Verification Agreement, and that Contractor had and continues to have the right to use such information as the basis of the design of the Stage 3 Facility. All written materials, plans, drafts, specifications, computer files or other documents (if any) prepared or furnished by Owner, Owner’s Affiliates or any of Owner’s other consultants or contractors shall at all times remain the property of Owner, and Contractor shall not make use of any such documents or other media for any other project or for any other purpose than as set forth herein. All such documents and other media, including all copies thereof, shall be returned to Owner upon Final Completion or the earlier termination of this Agreement, except that Contractor shall, subject to its confidentiality obligations as set forth in Article 19, retain one (1) record set of such documents or other media as required by Section 3.13A. Owner hereby grants to Contractor Group and Subcontractors and Sub-subcontractors of any of the foregoing with respect to the Work a non-exclusive, royalty-free, revocable, non-transferable license to use and modify Owner Proprietary Work Product (and all Intellectual Property existing or referenced therein) to the extent required to perform Contractor’s obligations under this Agreement. For the purposes of this Agreement, “Owner Proprietary Work Product” means Intellectual Property and written materials, plans, drafts,
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specifications, or computer files or other documents, owned by Owner or its Affiliates prior to the Agreement Date or developed or acquired by Owner or its Affiliates independently of this Agreement.

10.5License to Use Liquefaction and Other Process Technology. To the extent not covered by Section 10.2 or Section 10.6, Contractor hereby grants to Owner (and shall obtain from its Subcontractors and Sub-subcontractors) a fully-paid up, irrevocable, non-exclusive and royalty-free license or, as specified herein, sublicense (including process licenses) to allow Owner to operate and maintain the Stage 3 Facility for the purposes intended under this Agreement, including for natural gas pre-treatment, condensate production and the liquefaction of natural gas into LNG, practicing such technology in the Stage 3 Facility, and making, selling, offering to sell or exporting throughout the world, condensate and LNG produced at the Stage 3 Facility. As a condition of Substantial Completion of each Train or earlier termination, Contractor shall, to the extent not covered by Section 10.2 or Section 10.6, assign to Owner all licenses provided by any Subcontractor or Sub-subcontractor to Contractor. Owner shall be entitled to assign its rights in such licenses and sublicenses; provided that such assignee shall only be entitled to use such licenses and sublicenses for the purposes specified herein, which licenses shall in all respects remain limited by and subject to the terms of this Agreement.
10.6Licensors.
A.BASF. Notwithstanding anything in Article 10, in respect of any of the intellectual property rights consisting, in whole or in part, of the BASF process for the removal of carbon dioxide and/or hydrogen sulfide from gases, using, as scrubbing liquid, aqueous solution of methyldiethanolamine (“aMDEA”), and any technical information (e.g., process, data, technical information, know-how and improvements thereto) relating to the same, Contractor’s obligation to provide a license for such BASF process and technical information and Owner’s rights to use such BASF process and technical information are limited to an irrevocable, non-exclusive, non-transferrable and royalty-free sublicense (including with right to assign such license under specified circumstances other than to a competitor to BASF) to use, and practice the BASF gas process, patent rights and technical information for the design, erection, start-up, operation and maintenance of each acid gas removal unit that will utilize the BASF process, all as further described and in accordance with the sublicense agreement between Owner and Contractor executed on or prior to ninety (90) Days after NTP, which is attached hereto as Attachment II. Contractor represents that Contractor has a general license in the intellectual property rights from BASF sufficient for the performance of the Work (including the design, erection, start-up and maintenance of the Stage 3 Facility). Termination of the BASF license between Contractor and BASF shall be a Default under this Agreement.
B.License to Chart Licensed Intellectual Property.
1.Contractor shall, prior to and as a condition precedent to achievement of Substantial Completion of each Train or earlier termination of this Agreement, assign (and cause Chart to assign) to Owner a non-exclusive, worldwide, perpetual, royalty free, irrevocable license, sublicensable (to the extent set forth in this Section 10.6B1) and transferable (to the extent permitted in the Chart License Agreement) right to (i) engineer, procure, construct, startup, test, operate, maintain, repair, and modify all Equipment furnished by Chart; (ii) practice the Chart natural gas liquefaction process in respect of
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such Equipment incorporated into the Facility; and (iii) make, use, sell, offer to sell, import and export products obtained by such use, operation or practice of the Equipment furnished by Chart or by the practice of the Chart natural gas liquefaction process to any country in the world. Such assignment shall be in form attached hereto as Attachment JJ. Notwithstanding the foregoing, once the Parties enter into an Assignment and Assumption Agreement with Chart in the form of Attachment JJ, Owner’s rights under this Section 10.6 shall be addressed in such agreement and the Chart License Agreement.
2.Contractor shall stamp all Work Product that contains Chart Confidential Information on the face of the document with the words “CONTAINS CHART CONFIDENTIAL INFORMATION” or substantially similar and conspicuous marking. Work Product that is identified as containing Chart Confidential Information may contain such Chart Confidential Information in only a portion of the document and not on every page of the Work Product. The Chart logo appearing on a document shall not be a determining factor in whether a particular document contains Chart Confidential Information.










ARTICLE 11

COMPLETION AND PERFORMANCE LIQUIDATED DAMAGES

11.1Notice and Requirements for RFSU and RFFGI.
A.No later than twenty (20) Months prior to the Guaranteed Substantial Completion Date for each Train, Contractor shall provide to Owner for its review and comment detailed RFFGI requirements, in the form of procedures, for each Train. Contractor shall incorporate any of Owner’s comments to the RFFGI checklists and procedures that Contractor agrees with, acting reasonably in accordance with GECP, and issue a final version of the RFFGI checklists and procedures. Once finalized, such RFFGI procedures shall form a part of the requirements for achieving RFFGI of each Train. Contractor shall comply with all requirements for RFFGI set forth in this Agreement, including those requirements set forth in the definition of the term RFFGI, Attachment A, Attachment M and the such RFFGI checklists and procedures. Upon RFFGI of a Train, Contractor shall certify to Owner in the form of Schedule L-1 (“RFFGI Certificate”) that all requirements under this Agreement for RFFGI have occurred with respect to such Train, including all of the requirements specified in the applicable RFFGI checklist and procedure. The RFFGI Certificate shall be accompanied by all other supporting documentation
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expressly required under this Agreement to establish that the requirements for RFFGI for such Train have been met.
B.No later than twenty (20) Months prior to the Guaranteed Substantial Completion Date for each Train, Contractor shall provide to Owner for its review and comment detailed RFSU requirements, in the form of procedures, for each Train. Once Contractor has resolved all of Owner’s comments to the RFSU procedures, such RFSU procedures shall form a part of the requirements for achieving RFSU of each Train. Contractor shall comply with all requirements for RFSU set forth in this Agreement, including those requirements set forth in the definition of the term RFSU, Attachment A, Attachment M and the RFSU procedures. Upon RFSU of a Train, Contractor shall certify to Owner in the form of Schedule L-2 (“RFSU Certificate”) that all requirements under this Agreement for RFSU have occurred with respect to such Train, including all of the requirements specified in the applicable RFSU procedures have been completed.
1.Notwithstanding anything to the contrary, in no event may Contractor achieve RFSU of Train 2 earlier than one hundred twenty (120) Days after Contractor’s achievement of Substantial Completion of Train 1, unless Owner waives such requirement in writing in its sole discretion, the Parties recognizing that it is critical for the Stage 3 Facility to have a time period of one hundred twenty (120) Days between Substantial Completion of Train 1 and RFSU for Train 2.
11.2Notice and Requirements for Substantial Completion of a Train. Contractor shall comply with all requirements herein for Substantial Completion, including as set forth in the definition of Substantial Completion and in Attachments A, S and T. Contractor shall give Owner not less than ninety (90) Days’ prior notice of its intention to commence the initial Performance Test for a Train, and, on the sixtieth (60th) Day and thirtieth (30th) Day immediately prior to Contractor’s intention to commence such testing activities, Contractor shall provide notice to Owner. To the extent not specified in Attachment S, the Parties shall, no later than two hundred seventy (270) Days prior to the Guaranteed Substantial Completion Date for each Train, agree upon final test procedures for the conduct of the Performance Tests applicable to such Train. Except for the items listed in Attachment V, the Natural Gas feed pursuant to Section 4.6D, and operation personnel to be provided by Owner under Section 4.4, Contractor shall provide labor, Equipment, supplies, and all other items necessary for the conduct of the Performance Tests. Contractor shall analyze the data obtained during all Performance Tests and ensure that such data reflects the performance standards required hereunder. A complete electronic native copy of all raw performance data and a detailed listing of all testing instrumentation utilized shall be provided to Owner at the completion of testing. Upon achieving all requirements under this Agreement for Substantial Completion of the applicable Train, Contractor shall certify to Owner in a Substantial Completion Certificate in the form of Schedule L-3 (“Substantial Completion Certificate”) that all of the requirements under this Agreement for Substantial Completion of such Train have occurred and provide Owner with a Substantial Completion Certificate, a Performance Test report for the applicable Train. Each such report shall include, at minimum: (a) the raw data, (b) the procedures and instrumentation utilized for the applicable test, (c) test calculations and information in Microsoft Excel format, and a full explanation concerning same, for adjustments to the Guarantee Conditions, as and to the extent specified in Attachment S, and (d) any other reasonable supporting information used to demonstrate that the applicable Train has met the Minimum Acceptance Criteria. The Substantial
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Completion Certificate for each Train shall be accompanied by other supporting documentation as may be required to establish that the requirements for Substantial Completion of such Train has been met.
11.3Owner Acceptance of RFFGI, RFSU, and Substantial Completion. Owner shall notify Contractor whether it accepts or rejects a RFFGI, RFSU or Substantial Completion Certificate, as the case may be, within ten (10) Days following Owner’s receipt thereof. All Work shall continue during pendency of Owner’s review. Acceptance of such RFFGI Certificate, RFSU Certificate, or Substantial Completion Certificate shall not be unreasonably withheld and shall be evidenced by Owner’s signature on such RFFGI Certificate, RFSU Certificate, or Substantial Completion Certificate, which shall be forwarded to Contractor with such notice. If Owner does not agree that RFFGI, RFSU, or Substantial Completion has occurred for a Train, then Owner shall state the basis for its rejection in reasonable detail in a notice provided to Contractor within such ten (10) Day period. The Parties shall thereupon promptly and in good faith confer and make all reasonable efforts to resolve such issue. In the event such issue is not resolved within ten (10) Business Days following the delivery by Owner of its notice, Owner and Contractor shall resolve the Dispute in accordance with the Dispute resolution procedures provided for under Article 18 herein. Owner’s acceptance shall not relieve Contractor of any of its obligations to perform the Work in accordance with the requirements of this Agreement. If Owner accepts and signs Contractor’s Substantial Completion Certificate for a Train, the calculation of Delay Liquidated Damages and Schedule Bonus for such Train shall be based on the date Contractor specified in such certificate for achievement of Substantial Completion; provided, however, for the avoidance of doubt, this sentence shall not be construed to mean that Substantial Completion for a Train occurs on the date Owner received such certificate, as Substantial Completion shall occur only on the date Owner accepts Substantial Completion. Upon Owner’s acceptance of Contractor’s Substantial Completion Certificate for each Train, Contractor shall turn over such Train to Owner. Notwithstanding anything to the contrary in this Section 11.3, Owner shall not be required to accept a Substantial Completion Certificate if the requirements under this Agreement for the achievement of Substantial Completion of a Train have not been achieved. As used in this Section 11.3, “unreasonably withheld” means that Owner fails to accept a Substantial Completion Certificate even if all of the requirements under this Agreement for the achievement of Substantial Completion of a Train have been achieved. For the avoidance of doubt, “unreasonably withheld,” as used in this Section 11.3, means that Owner cannot fail to accept the applicable Substantial Completion Certificate if all the requirements under this Agreement for the achievement of Substantial Completion of a Train have been achieved.
11.4Performance Guarantees and Minimum Acceptance Criteria. Contractor shall achieve all Minimum Acceptance Criteria and Performance Guarantees for each Train or pay Performance Liquidated Damages, as described in greater detail in this Section 11.4. The Performance Tests for determining whether a Train achieves the Minimum Acceptance Criteria and Performance Guarantees are described in Attachment S. Performance Tests and any repeat tests shall be performed as specified in Attachment S.
A.Minimum Acceptance Criteria Achieved. In the event that Contractor fails to achieve any of the Performance Guarantees for a Train, as evidenced by the Performance Test results, but meets all of the Minimum Acceptance Criteria for such Train, then Contractor shall prepare a corrective work plan based on information then currently known that describes in reasonable detail the process Contractor intends to follow to achieve such Performance Guarantees and submit such plan to Owner for its (i) review (and Contractor shall incorporate
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any comments received from Owner that Contractor agrees with, acting reasonably) with regard to the process Contractor intends to follow to achieve such Performance Guarantees, and (ii) approval, not to be unreasonably withheld, with respect only to Contractor’s access to the applicable Train. If Contractor fails to comply with the corrective work plan with respect only to Contractor’s access to the applicable Train, then Owner may nevertheless restrict the performance of such Work to the scheduled date(s). Contractor shall work with Owner to develop a new plan and date for performing such Work in accordance with this Section 11.4A. Upon Contractor’s achievement of, and notification to Owner and Owner’s acceptance of, all requirements for Substantial Completion of such Train, Contractor shall turn over such Train to Owner and take corrective actions to achieve such Performance Guarantees during Owner’s operation of such Train as further specified below. In the event Substantial Completion of the applicable Train is achieved after the Guaranteed Substantial Completion Date for such Train (as such date may be extended by Change Order), Contractor shall be responsible for the payment of applicable Delay Liquidated Damages, to the extent Contractor is liable, in accordance with Section 11.3. After Substantial Completion of a Train, Contractor shall perform corrective actions to achieve such Performance Guarantees, but at all times performing such corrective actions in accordance with Owner’s security and safety requirements (including Owner’s permit to work system). For the period of time that Contractor is taking corrective action to achieve the Performance Guarantee(s) pursuant to this Section 11.4A, Owner shall provide safe, reasonable access to Contractor for performance of such corrective actions, but at all times performing such Work so as not to unreasonably interfere with the operation of the Stage 3 Facility or the CCL Liquefaction Facility, unless otherwise agreed by Owner. If such Train has not achieved all of the Performance Guarantees within one hundred and eighty (180) Days after Substantial Completion of such Train (as may be extended by Change Order, if Owner has not provided Contractor reasonable access in accordance with the access provisions of the corrective work plan approved by Owner and Contractor desires such an extension so that it may keep taking corrective actions to achieve the Performance Guarantees), then Contractor shall cease taking corrective actions to achieve the Performance Guarantees for such Train, and in that event, then Contractor shall pay to Owner in accordance with Section 13.2 the applicable Performance Liquidated Damages for such Performance Guarantees based on the results of the Performance Test(s) conducted by Contractor. The Performance Liquidated Damages shall be calculated in accordance with Attachment T. Contractor’s liability under this Section 11.4A shall be in addition to any Delay Liquidated Damages owed under this Agreement.
B.Minimum Acceptance Criteria Not Achieved. In the event that a Train fails to achieve any of the Minimum Acceptance Criteria, as evidenced by Performance Test results, by the Guaranteed Substantial Completion Date for each Train and as such date may be extended by Change Order as provided herein, then (i) Substantial Completion for such Train shall not have occurred and (ii) the provisions of Section 13.1 shall apply. In addition to the foregoing, Contractor shall (i) if requested by Owner, prepare a corrective work plan to achieve such Minimum Acceptance Criteria and submit such plan to Owner for its review (and Contractor shall incorporate any comments received from Owner that Contractor agrees with, acting reasonably and in accordance with GECP), and (ii) promptly correct the Work to enable such Train to achieve all of the applicable Minimum Acceptance Criteria and otherwise achieve Substantial Completion for such Train no later than twelve (12) months after the applicable Guaranteed Substantial Completion Date. If, on the one hand, such Train has not achieved all of
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the Minimum Acceptance Criteria and Substantial Completion (as the case may be) within such twelve (12) month period following the Guaranteed Substantial Completion Date for such Train, then Owner may, in its sole discretion, either (x) grant Contractor an additional period (not to exceed six (6) months) to achieve all Minimum Acceptance Criteria and achieve Substantial Completion under the same terms and conditions as the first, including the application of Section 13.1, or (y) claim Contractor in Default pursuant to Section 16.1A(xii). In the event that Owner claims such a Default at the end of either the twelve (12) month period or the additional six (6) month period, Owner shall be entitled to any and all damages, costs, losses and expenses to which Owner is entitled under Section 16.1D. If, on the other hand, such Train has achieved all of the Minimum Acceptance Criteria and Substantial Completion (as applicable) during the applicable twelve (12) month or additional six (6) month period (should Owner elect that option), then Contractor shall be liable to Owner for the Delay Liquidated Damages Owner is entitled to under Section 13.1 (and the Parties shall follow the process in Section 11.4A regarding the achievement of the Performance Guarantees).
11.5Punchlist.
A.Punchlist for RFSU. Prior to RFSU for each Train, Owner and Contractor shall inspect the Work related to such Train, and Contractor shall prepare a proposed Punchlist of items identified as needing to be completed or corrected as a result of such inspection. Contractor shall promptly provide the proposed Punchlist to Owner for its review, together with an estimate of the time necessary to complete or correct each Punchlist item. Contractor shall add to the proposed Punchlist any Punchlist items that are identified by Owner during its review, and Contractor shall immediately initiate measures to complete or correct, as appropriate, any item on Contractor’s proposed Punchlist that Owner, in the exercise of its reasonable judgment, believes must be completed or corrected so that such Work will achieve RFSU. Upon Contractor’s completion or correction of any items necessary to achieve RFSU in accordance with Contractor’s proposed Punchlist, as modified by any Owner additions where incorporated by Contractor, such Punchlist shall govern Contractor’s performance of the Punchlist items for each Train up to RFSU.
B.Punchlist for Substantial Completion. Prior to Substantial Completion of a Train, Owner and Contractor shall inspect the entire Work related to such Train, and Contractor shall prepare a proposed a list of Punchlist items identified as needing to be completed or corrected as a result of such inspection. Contractor shall promptly provide the proposed Punchlist to Owner for its review and approval, together with an estimate of the time and cost necessary to complete or correct each Punchlist item. Contractor shall add to the proposed Punchlist any items that are identified by Owner during its review, and Contractor shall immediately initiate measures to complete or correct, as appropriate, any Punchlist item on Contractor’s proposed list or otherwise that Owner in the exercise of its reasonable judgment, believes must be completed or corrected for such Train to achieve Substantial Completion. Owner shall provide its review, modifications and approval to Contractor within seven (7) Days after Owner’s receipt of the proposed Punchlist from Contractor. Upon Contractor’s completion or correction of any Punchlist item necessary to achieve Substantial Completion of such Train and Owner’s approval of Contractor’s proposed Punchlist, as modified by any Owner additions as set forth above in this Section 11.5B, such Punchlist shall govern Contractor’s performance of the Punchlist up to Final Completion;
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provided, however, if any items of a Punchlist nature are discovered by Owner or Contractor prior to Final Completion, such items shall be corrected in accordance with Section 12.3B and further provided that the failure to include any items on the Punchlist shall not alter the responsibility of Contractor to complete all Work in accordance with the terms and provisions of this Agreement. Once Substantial Completion of the applicable Train has occurred, Owner shall provide reasonable access on the Site sufficient for Contractor to perform its Punchlist Work so long as such activities do not unreasonably interfere with the operation of such Train and any other Train that has achieved Substantial Completion and subject to Owner’s permit to work system. The Punchlist shall be completed by the Final Completion Date, or Owner may, in addition to any other rights that it may have under this Agreement, complete such Punchlist at the expense of Contractor. In the event Owner elects to complete such Punchlist, Contractor shall immediately pay Owner (directly, by offset, or by collection on the Letter of Credit, at Owner’s sole discretion) all costs and expenses incurred in performing such Punchlist.
11.6Notice and Requirements for Final Completion. Final Completion shall be achieved when all requirements for Final Completion under this Agreement, including those set forth in the definition of Final Completion under Article 1, have been satisfied. Upon Final Completion, Contractor shall certify to Owner in the form of Schedule L-4 (“Final Completion Certificate”) that all of the requirements under this Agreement for Final Completion have occurred. Owner shall notify Contractor whether it accepts or rejects (such acceptance or rejection to be given reasonably) the Final Completion Certificate within ten (10) Days following Owner’s receipt thereof. Acceptance of such certificate shall be evidenced by Owner’s signature on such certificate, which shall be forwarded to Contractor with such notice. If Owner does not agree that Final Completion has occurred, then Owner shall state the basis for its rejection in reasonable detail in a notice provided to Contractor. The Parties shall thereupon promptly and in good faith confer and make all reasonable efforts to resolve such issue. In the event such issue is not resolved within ten (10) Business Days following the delivery by Owner of its notice, Owner and Contractor shall resolve the Dispute in accordance with the Dispute resolution procedures provided for under Article 18; provided, however, if such deficiencies relate to the failure to complete the Punchlist, Owner may, in addition to any other rights that it may have under this Agreement, complete such Punchlist Work at the expense of Contractor in accordance with Section 11.5. Notwithstanding anything to the contrary in this Section 11.6, Owner shall not be required to accept the Final Completion Certificate if the requirements under this Agreement for the achievement of Final Completion have not been achieved. As used in this Section 11.6, “to be given reasonably” means that Owner fails to accept the Final Completion Certificate even if all of the requirements under this Agreement for the achievement of Final Completion have been achieved. For the avoidance of doubt, “to be given reasonably,” as used in this Section 11.6, means that Owner cannot fail to accept the Final Completion Certificate if all the requirements under this Agreement for the achievement of Final Completion have been achieved.
11.7Partial Occupancy and Use. Prior to Contractor achieving Substantial Completion of any Train, Owner may, upon giving written notice to Contractor, occupy or use all or any portion of any usable building or road then capable of functioning safely, provided that such occupancy or use is authorized by the Governmental Instrumentality (to the extent such authorization is necessary) and Owner’s insurance company or companies providing property insurance have consented to such partial occupancy or use (to the extent such consent is necessary). Contractor shall assist Owner and take reasonable steps in obtaining consent of the insurance company or companies and applicable Governmental Instrumentalities. Immediately prior to such partial occupancy or use, Owner and
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Contractor shall jointly inspect that portion of any usable building or road to be occupied or used in order to determine and record the condition of such portion of such usable building or road and all personnel and environmental safety aspects relating thereto. Upon such occupancy by Owner, Contractor shall connect all necessary utilities, security, and telephones, and provide furnishings (as applicable) as further specified in Attachment A and Owner shall insure such portion of the usable building immediately upon taking over such building and Owner’s use or occupancy shall not interfere with or disrupt Contractor’s completion of the Work. Such occupancy or use shall not in any way release Contractor or any surety of Contractor from any obligations or liabilities pursuant to this Agreement, including the obligation to engineer, procure and construct a fully operational natural gas liquefaction facility within the required times set forth in the Guaranteed Dates and otherwise in accordance with all requirements of this Agreement, nor shall such occupancy or use be deemed to be an acceptance by Owner of such portion of the Work provided however, if Owner’s use or occupancy under this Section 11.7 adversely affects Contractor’s or its Subcontractors’ or Sub-subcontractors’ cost or time for performance of the Work in accordance with the requirements of this Agreement, then Contractor shall be entitled to a Change Order pursuant to Section 6.2A.5 and Section 6.8. For any portion of the Work that Owner occupies and uses pursuant to this Section 11.7, the Defect Correction Period for that portion of the Work shall commence upon Owner’s occupancy and use of such portion of the Work and the risk of loss for such portion of the Work shall transfer to Owner, notwithstanding Section 8.2.


11.8Operations Activities. Prior to Substantial Completion of a Train, but after RFSU has been achieved for such Train, Contractor shall, to the extent reasonably possible, cooperate with Owner in connection with (a) the receipt of Natural Gas feed; (b) producing LNG; and (c) such other activities as reasonably requested by Owner related to the commercial use of such Train (each, an “Operations Activity” and, collectively, the “Operations Activities”). Contractor shall not have the obligation to follow Owner’s requests for any Operations Activity if such Operations Activity adversely impacts Performance Testing or repairs to such Train or impacts the ability to safely operate such Train in accordance with the requirements of this Agreement. Contractor shall promptly provide notice to Owner informing Owner whether it can comply with Owner’s requests and the reason if it cannot so comply. Contractor’s performance of the Operations Activities shall not in any way release Contractor from any obligations or liabilities pursuant to this Agreement, including its obligations to meet Substantial Completion for each Train and Final Completion of the Stage 3 Facility.

11.9Long-Term Obligations. No acceptance by Owner of any or all of the Work or any other obligations of Contractor under this Agreement, including acceptance of any RFFGI, RFSU, Substantial Completion, or Final Completion, nor any payment made hereunder, whether an interim or final payment, shall in any way release Contractor or any surety of Contractor from any obligations or liability pursuant to this Agreement, including Warranty obligations, any liabilities for which insurance is required or any other responsibility of Contractor, including the payment of any and all fines and penalties assessed to the extent caused by Contractor’s failure to comply with any Applicable Law as set forth in Section 17.1F. It is expressly understood and agreed by the Parties that nothing in this Article 11 shall in any way modify or alter Contractor’s obligations under Article 12 and Article 13 hereof.
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ARTICLE 12
WARRANTY AND CORRECTION OF WORK
12.1Warranty.
A.General. The warranties set forth in Section 12.1B (each a “Warranty” or collectively, the “Warranties”) are in addition to any of the Minimum Acceptance Criteria or Performance Guarantees set forth in this Agreement. Any Work, or component thereof, that is not in conformity with any Warranty is defective (“Defective”) and contains a defect (“