ML081140474
ML081140474 | |
Person / Time | |
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Site: | Vermont Yankee File:NorthStar Vermont Yankee icon.png |
Issue date: | 04/21/2008 |
From: | Blakely D Covington & Burling, Electric Power Research Institute |
To: | Atomic Safety and Licensing Board Panel |
SECY RAS | |
References | |
50-271-LR, ASLBP 06-849-03-LR, RAS M-29 | |
Download: ML081140474 (38) | |
Text
DOCKETED USNRC April 21, 2008 (3:54pm)
OFFICE OF SECRETARY RULEMAKINGS AND April 21, 2008 ADJUDICATIONS STAFF UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Before the Atomic Safety and Licensing Board In the Matter of )
)
ENTERGY NUCLEAR VERMONT )
YANKEE, LLC and ENTERGY NUCLEAR)
OPERATIONS, INC. ) Docket No. 50-271-LR
)
)
(Vermont Yankee Nuclear Power Station) ) ASLBP No. 06-849-03-LR EPRI's Opposition to NEC's Motion to Compel and for Subpoena Pursuant to 10 C.F.R. §§ 2.319(b), 2.323(c) and (h), and the guidance in 10 CFR
§§ 2.702 and 2.705(c), the Electric Power Research Institute, Inc. ("EPRI") submits this Opposition to New England Coalition's Motion to Compel and For Subpoena.' EPRI attempted to confer with the parties in good faith to eliminate the need for a subpoena or an opposition thereto prior to NEC's filing of its motion and subpoena request, but such attempts were rejected by NEC as insufficient.
For reasons that are not set forth in its motion, New England Coalition ("NEC")
would have the Board compel EPRI, a nonparty, to produce its proprietary and confidential CHECWORKS software source code and embedded mathematical algorithms to a self-proclaimed expert on the prediction of flow accelerated corrosion ("FAC") and an actual competitor of EPRI, Dr. Joram Hopenfeld. Forced disclosure of the CHECWORKS code in this I While 10 C.F.R. §§ 2.702 and 2.705(c) only apply to formal proceedings conducted under Subpart G of 10 C.F.R. Part 2, they provide useful guidance regarding the protection of a non-party from "annoyance, embarrassment, oppression, or undue burden or expense" as a result of a discovery request in a Commission proceeding.
manner would cause severe and irreparable harm to EPRI, while having no impact on the resolution of Contention 4. Accordingly, the Board should deny NEC's Motion to Compel.
BACKGROUND EPRI, a nonprofit scientific research organization, conducts public interest research and development on technologies needed for the safe, reliable and environmentally sound generation, transmission and utilization of electricity. Wilmshurst Decl. at ¶ 3. Its work in these areas is funded by utilities, public power suppliers, rural cooperatives, Federal, state and local governmental agencies and international utilities. Id. at ¶ 4. By pooling their resources and working collaboratively, these entities are able to support development of new technologies that no one company or entity could afford on its own. Importantly, every nuclear utility in the United States supports EPRI's programs in materials science, fuels research and maintenance and operations. Id. at ¶ 5. In this work, EPRI often works closely with NRC Research.
The companies that sponsor EPRI research receive paid-up, internal use licenses to the research results and software. They often also participate in "users groups" in which sponsoring members discuss the application of EPRI technology at their facilities as well as to provide critical feedback to EPRI on how to improve or modify products in order to meet new and emerging needs. Id. at ¶ 6. EPRI offers licenses on a nondiscriminatory basis to non-sponsoring companies. Id. As a nonprofit operating for the public benefit, EPRI's goal is not to "profit" from licensing fees, but to ensure that it can sustain its research program over the long term.
EPRI's research efforts have led to the development of technologies that are important to the continued safe and efficient operation of the nation's nuclear power plants --
such as CHECWORKS software. CHECWORKS utilizes a complex set of algorithms to assess 2
thermodynamic, chemical, and material conditions to predict wear rates and remaining service life for pipe components in the steam and feed water cooling systems used in nuclear power plants. Id. at ¶ 8. CHECWORKS software and the associated CHECWORKS User Group
("CHUG") represent an important source of revenue supporting EPRI's continued research and development efforts. Id. at ¶ 10.
EPRI is not a party, but instead licenses the CHECWORKS software to the applicant here, Entergy, for use in its Vermont Yankee Nuclear Power Station. Nonetheless, EPRI offered its full cooperation to the parties by, inter alia, conducting a briefing on the design and operation of CHECWORKS including a demonstration of how the program works on sample data. EPRI made it known that it would have provided additional information as needed if NEC found the briefing insufficient. However, NEC rejected this offer out of hand. NEC did not make any reasonable counteroffer to EPRI or Entergy, instead demanding wholesale access to EPRI's intellectual property under an insufficient protective order.2 EPRI has no interest in this litigation other than to protect the integrity of its confidential and valuable intellectual property, which has been put in jeopardy by NEC's unreasonable discovery demand.
ARGUMENT CHECWORKS code constitutes valuable, proprietary, and confidential intellectual property, the release of which would undermine EPRI's research program, which depends on the continuing collaboration of its members and, in particular, the nuclear utility industry. The Commission should not require EPRI to bear the risk of loss of its valuable 2 EPRI understands that Entergy is filing a separate response in opposition to NEC's motion to compel. We defer to Entergy and its counsel to fully address the reasons why NEC's Motion is tardy.
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confidential asset, especially where, as here, examination of the code would not serve to prove or disprove any element of Contention 4.
NEC's contention is that Entergy has not proposed an adequate plan to manage the aging of Vermont Yankee plant piping due to flow accelerated corrosion ("FAC"). NEC states that Entergy's reliance on EPRI's CHECWORKS software to help manage inspections of piping at Vermont Yankee is inadequate "because it will not be possible, prior to the expiration of Entergy's current operating license, to 'benchmark' [CHECWORKS] to changes in Vermont Yankee plant parameters resulting from a twenty percent increase in the plant's operating power, implemented in 2006." NEC Mot. at 2.
Whatever the merits of NEC's thesis 3 , they may be tested without access to the highly proprietary code and algorithms of CHECWORKS. Inspection of CHECWORKS' code would not add any useful information and would merely place this highly confidential and proprietary information in the hands of NEC's expert, thereby jeopardizing EPRI's position in the market.
I. NRC Discovery Rules Do Not Require the Disclosure of Confidential Intellectual Property of a Nonparty In accordance with 10 C.F.R. § 2.705(2)(i) and (iii), the Board may limit discovery where "the burden or expense of the proposed discovery outweighs its likely benefit, taking into account ... the importance of the proposed discovery in resolving the issues." 10 C.F.R. § 2.705(2)(i), (iii). When a discovery request is unreasonably broad or burdensome, the presiding officer may deny it, or order that it may be had only on specified terms and conditions 3 CHECWORKS has been used for 15 years to aid plant operators' piping inspection regimes without a failure of any major pipe component, whether in a plant operating at nominal power or at uprate power conditions. Wilmshurst Decl. at ¶¶ 9, 11.
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including that "trade secret or other confidential research, development, or commercial information may not be disclosed or disclosed only in a designated way." 10 C.F.R. § 2.705(c)(1)(i)-(vi). A protective order is appropriate to prevent discovery of a nonparty's "important proprietary information" where the nonparty has "historically sought to maintain the confidentiality of this information," and where no showing of substantial need has been made.
Cf Gonzalez v. Google, Inc., 234 F.R.D. 674, 684 (N.D. Cal. 2006) (under F.R.C.P. 45(c),
quashing subpoena seeking Google's propriety search index and query log due to its important, confidential, and proprietary character).
Good cause for the entry of a protective order would exist here because the potential harm to EPRI caused by disclosure of CHECWORKS code far outweighs any importance such disclosure could conceivably have to the resolution of NEC's Contention 4.
Because the Board's rules would prevent the discovery of CHECWORKS code by issuance of a protective order, NEC's motion to compel should be denied.
A. CHECWORKS Code and Mathematical Algorithms are Valuable and Confidential Intellectual Property There can be no doubt that the CHECWORKS source code and embedded proprietary algorithms are valuable intellectual property. EPRI derives approximately $1 million per year from CHECWORKS related revenue, including licensing of CHECWORKS software and membership in CHUG. Wilmshurst Decl. at ¶ 10. Membership in CHUG does not require the purchase of a CHECWORKS license, but participation in CHUG can lead to the purchase of such a license. Importantly, as discussed below, CHECWORKS licensees and CHUG members do not have access to the underlying source code and algorithms that NEC is seeking here.
Every nuclear power plant in the United States is currently a CHECWORKS licensee and CHUG member. Id. at ¶ 5. While CHECWORKS is the market leader for FAC 5
assessment software in the U.S., EPRI faces increasing competition from other predictive methodology software packages. Id. at T 18. Additional competition in the field comes from engineering and technical services firms. Id. at TT 17. Loss of CHECWORKS as proprietary code would undermine a valuable source of revenue, which, in turn, could put the sustained development and application of this product at risk and challenge the further development of technologies that are important to the continued safe and economic operation of the nuclear fleet.
In order to sustain its research program in this increasingly competitive market, it is important for EPRI to prevent competitors from free-riding on its efforts. EPRI does this by strictly controlling access to CHECWORKS source code and proprietary algorithms. In fact, licensees only receive an executable application using object code, not source code. Id. at ¶ 12.
Licensees must agree to terms and conditions that restrict copying or "reverse engineering" CHECWORKS' analysis methods and algorithms. See Exhibit 1 to Wilmshurst Decl. (EPRI License Agreement) at 6.
EPRI strictly controls access to CHECWORKS source code and the embedded mathematical algorithms within its own walls, as well. Each is available only to the CHECWORKS' software and design team. This team comprises only three people. Wilmshurst Decl. at T 15.
Mitigation of FAC is an emerging market, and one in which Dr. Hopenfeld participates. In fact, Dr. Hopenfeld has two patents relevant to diagnosing and mitigating the effects of FAC. Id. at ¶ 25. Disclosure here would be to give him, gratis, the benefit of the substantial research and development efforts EPRI has expended in creating and updating CHECWORKS, thus unfairly enabling him to take advantage of market growth at EPRI's expense. In short, disclosing the CHECWORKS source code and algorithms to Dr. Hopenfeld 6
would be akin to allowing Pepsi to see the formula for Coca-Cola. It is clear that EPRI's current market position and future sales would be jeopardized should CHECWORKS be disclosed in this case.
B. The Existing Protective Order is Inadequate to Protect EPRI's Confidentiality Interest in Its Proprietary Information In spite of its expert being an acknowledged competitor to EPRI, NEC sees no problem with disclosure, averring that production and inspection of CHECWORKS code would be carried out under the current protective order. Mot. at 2. However, the subject protective order does not even include within its scope software code or mathematical algorithms. See Protective Order at 4 (pertaining to "documents" containing trade secret or commercial financial information).
Moreover, merely modifying the existing protective order to specifically include software and algorithms would not be enough. A protective order cannot completely prevent the use of acquired knowledge. As discussed above, NEC's expert is an acknowledged competitor of EPRI's in assessment of FAC, and he has not agreed to refrain from entering the field of software occupied by CHECWORKS. Once Dr. Hopenfeld had examined the source code and algorithms, it would be impossible to prevent him from consciously or unconsciously incorporating CHECWORKS' design ideas into his own products or services. Even if such use could be detected and proven, and even if such use were covered under the protective order, EPRI would be forced to expend substantial time and capital to enforce its rights.
C. Examination of CHECWORKS Code and Algorithms is Unnecessary to Resolution of Contention 4 The risk that disclosure of CHECWORKS code to Dr. Hopenfeld would pose far outweighs the potential importance of that code to the resolution of Contention 4. NEC grounds its contention on the belief that until CHECWORKS has been sufficiently benchmarked under 7
uprate conditions at Vermont Yankee, the software will be of limited usefulness in predicting pipe wear due to FAC. This argument presupposes that CHECWORKS algorithm uses inaccurate default wear coefficients, or that it does not scale accurately within the range of possible coolant flows at Vermont Yankee.
Although the validity of these contentions is suspect on its face, the contentions may be tested without need to examine source code or algorithms. CHECWORKS uses default coefficients that have been validated by years of successful use, and continue to be validated by data reported though CHUG. Id. at ¶¶ 9, 11, 16, 23. Moreover, EPRI refines CHECWORKS' accuracy at each software update by tuning parameters to take into account empirical data reported through CHUG. These updates include FAC data generated by approximately three dozen boiling water reactors ("BWR") operating in the US, like Vermont Yankee, and data from FAC experienced at extended power uprates of almost 10 years. Id. at ¶ 19. As a result of this continuous update process, there has never been a major coolant pipe failure in a plant properly using CHECWORKS since it was introduced in 1993, including B WR plants operatingat uprate conditions. Id. at ¶ 19-22. None of these updates changes the software code or the proprietary mathematical algorithms NEC seeks. Id. at ¶ 23. Each of the default assumptions can be tested by operation rather than inspection.
The only relevant fact to resolving NEC's contention is whether CHECWORKS produces accurate results. Dr. Hopenfeld's assertion that extensive benchmarking is required before CHECWORKS is reliable could be confirmed or refuted by comparing the CHECWORKS predictions against empirical data gathered from actual inspections at Vermont Yankee. The magnitude of difference, if any, between observed and predicted pipe wear values 8
would determine the accuracy and precision of CHECWORKS with certainty. Id. at ¶ 26.
Reviewing the code or algorithms would accomplish none of this.
CHECWORKS requires considerable training and expertise to operate, as well as substantial engineering judgment to interpret its predictions. Id. at ¶ 24. Looking at static algorithms in code would not account for these essential elements of FAC assessment using CHECWORKS' predictions. Thus, examination of the source code and algorithms would provide little, if any, information about CHECWORKS' ability to produce accurate FAC predictions.
Because NEC's benchmarking contentions could be adequately evaluated by assessing the operation of CHECWORKS in action, examination of CHECWORKS code and algorithms could-only serve as a fishing expedition to discover real or imagined flaws unrelated to issues raised by Contention 4. NEC should not be allowed to have its expert fish through EPRI's valuable and confidential intellectual property to manufacture support for a surmise.
For the foregoing reasons, NEC's Motion to Compel should be denied.
Respectfully submitted, COVINGTON & BURLZG LLP 1201 Pennsylvania Ave., NW Washington, DC 20004 Tel. (202) 662-5418 Counsel for Electric Power Research Institute, Inc.
Dated: April 21, 2008 9
April 18, 2008 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Before the Atomic Safety and Licensing Board In the Matter of )
)
ENTERGY NUCLEAR VERMONT )
YANKEE, LLC and ENTERGY NUCLEAR)
OPERATIONS, INC. ) Docket No. 50-271-LR
)
)
(Vermont Yankee Nuclear Power Station) ) ASLBP No. 06-849-03-LR DECLARATION OF NEIL WILMSHURST IN SUPPORT OF EPRI's OPPOSITION TO MOTION TO COMPEL
- 1. I, Neil Wilmshurst, am the Director of Nuclear Plant Technology at the Electric Power Research Institute, Inc ("EPRI").
- 2. I hold a B.Sc. in Naval Engineering from the Royal Naval Engineering College, a Post Graduate Diploma in Nuclear Reactor Technology from the Royal Naval College -
Greenwich, and a Masters Degree in Defense Administration from the Cranfield Institute of Technology. I have worked in the nuclear industry for in excess of 25 years in both the defense and public utility sectors. I have been employed by EPRI for 4 2 years, and for the last 1/2years I have had supervisory responsibility for the CHECWORKS software research program and flow-accelerated corrosion ("FAC") studies.
- 3. EPRI is a nonprofit scientific research organization, which conducts public interest research and development on technologies needed for the safe, reliable and environmentally sound generation, transmission and utilization of electricity.
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- 4. EPRI is funded by member utilities, public power suppliers, rural cooperatives, Federal, state and local governmental agencies and international utilities.
- 5. Every nuclear utility in the United States supports EPRI's research programs in materials science, fuels research and maintenance and operations. There are 104 operating commercial nuclear reactor units in the United States, and each is a CHECWORKS licensee and CHECWORKS User Group ("CHUG") member.
- 6. EPRI licenses the results of its research, including software products, in two ways.
Companies or organizations that fund EPRI's nuclear sector research receive paid-up, internal use licenses. Licenses are also available to other organizations on a non-discriminatory basis. Licensees may participate in user groups related to the research, such as CHUG. CHUG membership is also available without the purchase of a CHECWORKS license.
7- CH-ECWORKS is-a: software package-used-topredict-wear rates, and remaining-service life-in the pipe components of steam and feed water cooling systems. It was first released in 1993.
- 8. CHECWORKS utilizes a set of proprietary mathematical algorithms to assess individual components of pipe wear due to FAC, such as thermodynamic, chemical, and pipe material conditions.
- 9. CHECWORKS takes into account plant specific conditions as well as experiential data generated over the last 15 years at approximately 255 nuclear power plants worldwide.
- 10. EPRI derives approximately $1 million per year from CHECWORKS related activities.
EPRI offers CHECWORKS licenses to non-EPRI nuclear sector members for $300,000 per 2
seat. Membership in CHUG without licensing CHECWORKS requires payment of an annual fee between $11,000 and $30,000 based upon number of units.
- 11. Nuclear Power plants properly using CHECWORKS have never reported a failure in a steam and feed water system pipe or component of 2" in diameter or greater. There have been a few reported leaks in pipe components at smaller than 2" in diameter, however, failures in such pipes do not have the same consequences for personnel safety or plant operation.
CHECWORKS is not recommended for use in the prediction of FAC in pipes smaller than 2" in diameter.
- 12. CHECWORKS is provided to licensees as an executable software application consisting of assembled object code.
- 13. In 1997, a 5-diameter "sweep" (i.e. bent pipe) in an extraction steam line failed at the Fort Calhoun Nuclear Power Station. Post accident investigation by the U.S. Nuclear Regulatory Commission revealed that although the utility had used CHECWORKS, it made several errors the most significant of which was not including replaced components in the model causing the failure location to be missed.
- 14. Attached hereto as Exhibit 1 is a true and correct copy of EPRI's Master Agreement with Entergy.
- 15. There are three members of the CHECWORKS software and design team, EPRI employees David Ha and Ronald King, and outside contractor Jeff Horrowitz. No other person within or without EPRI has access to CHECWORKS source code or mathematical algorithms.
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- 16. Updates to CHECWORKS using plant specific data do not change the algorithms or source code. All calculations work from the same equations regardless of power rate, flow conditions, chemical composition, or temperature.
- 17. The following is a partial list of vendors that offer engineering and/or technical services to aid in the mitigation of flow-accelerated corrosion: Structural Integrity Associates; Enercon Services Inc.; John Reas; Areva; Tetra Engineering; Harris Group; McDermott Technology, Inc.; Westinghouse; Altran Solutions; CSI Technologies; Atomic Energy Canada Ltd.; and Nuclear Safety Solutions. If the CHECWORKS source code and algorithms were released into the public, any one of these parties could incorporate CHECWORKS design ideas into their products and services.
- 18. The following is a list of software that competes with CHECWORKS in assessment of flow-accelerated corrosion: Comsys, Seimens (Germany); BRT Cicero, EdF (France); and RAMEK, (Russia).
- 19. Domestic utilities have reported approximately 116 uprates to commercial nuclear reactor units since 1977. The following is a list of uprates at nuclear power units comparable to that projected at Vermont Yankee (data available at http://www.nrc.gov/reactors/operating/licensing/power-uprates.html#past):
Nuclear Station Uprate Year Duane Arnold 15.3% 2001 Dresden 2 17% 2001 Dresden 3 17% 2001 Quad Cities 1 17.8% 2001 4
Quad Cities 2 17.8% 2001 Clinton 20% 2002
- 20. Each of these power stations uses CHECWORKS. There have been no reported failures in any major steam and feed water system piping component at any of these plants.
- 22. There are 104 total operating commercial nuclear reactor units in the United States. Of these, 69 are Pressurized Water Reactors (PWR) and 35 are Boiling Water Reactors (BWR).
- 23. The original embedded algorithms have had negligible changes from CHEC (released 1988),
CHECMATE, (released 2 years later) and the current version, CHECWORKS, (released 1993). Some information has been updated, such as the wear factor from the chemical Hydrazine, based on extended laboratory reports. None of these algorithms are modified by plant specific data.
- 24. CHECWORKS requires considerable training and expertise to operate, as well as substantial engineering judgment to interpret its predictions.
- 25. I have reviewed the abstracts 'of patent disclosures attributed to Dr. Joram Hopenfield. Two of these patents, Nos. 4,922,748 and 4,779,453, are in the field of assessment of FAC.
- 26. Comparison of actual data gathered at Vermont Yankee with CHECWORKS' predictions would be adequate to assess the accuracy and precision of the software's wear predictions.
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I declare under penalty of perjury that the foregoing is true and correct. Executed on April 18, 2008. ,
NEIL WILMSHURST ELECTRIC POWER RESEARCH INSTITUTE 1300 West WT Harris Blvd Charlotte, N.C. 28262-2867 ELECTRIC POWER SRESEARCH INSTITUTE MASTER AGREEMENT FOR EPRI MEMBER PARTICIPATION This Master Agreement for EPRI Participation ("Master Agreement") is entered into as of January 1. 2006 (the "Effective Date") between the Electric Power Research Institute, Inc., a nonprofit corporation organized under the laws of the District of Columbia ("EPRI"), with principal headquarters at 3420 Hillview Avenue, Palo Alto, California 94304, and Entergy Arkansas, Inc., Entergy Gulf States, Inc., Entergy Louisiana, LLC, Entergy New Orleans, Inc., Entergy Mississippi, Inc., Entergy Nuclear, Inc., Entergy Nuclear Generation Company, Entergy Nuclear Operations, Inc., Entergy Operations, Inc., Entergy Operations Services, Inc., Entergy Nuclear Vermont Yankee, LLC, Entergy Services, Inc., Entergy Nuclear Indian Point 2, LLC, Entergy Nuclear Indian Point 3, LLC, Entergy Nuclear Fitzpatrick, LLC, and TLG Services, Inc. (collectively, "Member," individually "Member Company').
Entergy Services, Inc., a Delaware corporation with offices at 639 Loyola Avenue, New Orleans, LA 70113 will serve as EPRI's contact company for this agreement.
EPRI and Member (collectively referred to as the "Parties") agree as follows:
RECITALS WHEREAS, it is the intention of EPRI to utilize one Master Agreement for EPRI Member Participation to cover:
(i) Participation in EPRI's Annual Research Portfolio, including any work offered by EPRI's taxable Affiliate, EPRI Solutions, Inc. ("ESI"),
(ii) Participation in EPRI's Additional Project Opportunities, and (iii) The internal use license rights for the EPRI and/or ESI Materials.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and agreements set forth below, the Parties agree as follows:
Article 1. Definitions 1.01 "Additional Project Opportunity(ies)" means a Project, Major Field Test or Demonstration (large scale, collaborative, multi-year project that focuses on the full scale testing of EPRI intellectual property to show its functionality and viability in real time), and Technology Transfer activities that are introduced outside of the Annual Research Portfolio.
1.02 "Affiliate(s)" means those entities who are (1) any corporation, company, partnership or other entity in the United States in which Entergy Corporation now or hereafter owns or controls, directly or indirectly, more than fifty percent (50%) of the ownership interest having the right to vote or appoint its directors or their functional equivalents ("Affiliated Company'), (2) any joint venture in which Entergy Corporation or an Affiliated Company owns fifty percent (50%) or more of the ownership interest, (3) any corporation, company, partnership or other entity that has an ownership interest, directly or indirectly, in any site controlled, operated or managed by an Affiliated Company, or joint venture as described in (2) immediately preceding, or (4) any successor in interest to (1) through (3) above. Member designates Affiliates to have use rights to the EPRI Materials pursuant to this Master Agreement, and any subsequent Research Portfolio Agreement and/or Project Opportunity Agreement.
EPRI Master Agreement PagetI June 2005
1.03 "Annual Research Portfolio" means Programs, Project Sets or Projects that are included as part of EPRI's annual offering for collaborative research and development.
1.04 "Confidential Information" means information that is proprietary and/or confidential to the discloser, and shall include trade secrets.
1.05 "Deliverables" means the version of EPRI Materials to be delivered as described in each Research Portfolio Agreement, or each Project Opportunity Agreement.
1.06 "Derivative Works" means any form into which Deliverables may be recast, transformed or adapted including the modification, revision, condensation, translation, abridgment and/or expansion thereof.
1.07 "EPRI Intellectual Property Rights" means any patent, copyright, trademark, trade secret, know-how, or other intellectual property owned or licensed by EPRI.
1.08 "EPRI Materials" means all tangible and intangible results including data, reports, documentation, and machine readable and human readable software ("Object Code" and "Source Code" respectively; collectively "Software"), generated, developed, conceived, or first reduced to practice in any EPRI Program or Project, which is owned by EPRI and provided to Member from time to time under this Master Agreement, including without limitation Deliverables and EPRI Intellectual Property Rights. EPRI Materials shall not include what is described in this section to the extent that Member or any Affiliate participated or contributed in its development, the ownership of such contribution to remain with the applicable Member or Affiliate, provided that EPRI has not paid Member or Affiliate to create such a contribution. With respect to Member or Affiliate contribution, EPRI will have a non-exclusive, perpetual right to use such contribution (subject to the obligations of confidentiality below) for research.
1.09 "Funding or Funds" shall mean the Member's monetary support to be provided in support of the Annual Research Portfolio and/or Additional Project Opportunities.
1.10 "License" means the non-exclusive internal use license granted Member under Subarticle 5.01 of this Master Agreement.
1.11 "Member" means any funding entity that qualifies for membership under EPRI's By-Laws, purchases from the Annual Research Portfolio and elects to utilize the benefits of EPRI Membership.
Members may also fund one or more Additional Project Opportunities and may participate in the Tailored Collaborations program.
1.12 "Member Companies" shall mean each of the following companies: Entergy Arkansas, Inc.,
Entergy Gulf States, Inc., Entergy Louisiana, LLC, Entergy New Orleans, Inc., Entergy Mississippi, Inc.,
Entergy Nuclear, Inc., Entergy Nuclear Generation Company, Entergy Nuclear Operations, Inc., Entergy Operations, Inc., Entergy Operations Services, Inc., Entergy Nuclear Vermont Yankee, LLC, Entergy Services, Inc., Entergy Nuclear Indian Point 2, LLC, Entergy Nuclear Indian Point 3, LLC, Entergy Nuclear Fitzpatrick, LLC, and TLG Services, Inc.
1.13 "Member TC Pool" shall have the meaning given to it in Section 2.05(a).
1.14 "Program" means a general segment of the Annual Research Portfolio.
1.15 "Project" means a more specific segment of the Annual Research Portfolio or Additional Project Opportunities.
1.16 "Project Opportunity Agreement' means the individual cost, scope, term and Deliverables agreed upon by the Parties for the conduct of an Additional Project Opportunity that Member will support with Funding.
EPRI Master Agreement Page 2 June 2005
1.17 "Research Portfolio Agreement" means the selected Programs and Projects from the Annual Research Portfolio that Member will support with Funding.
1.18 "Technology Innovation" the strategic long term research program conducted by EPRI (formerly known as SS&T).
1.19 'Technology Transfer" means the various forums used to inform and solicit feedback from Member on experiences in using EPRI technical information. Such forums include interest groups, training and workshops, and user groups.
1.20 'OC" or "TC Program" shall mean EPRI's Tailored Collaboration Program.
Article 2. Funding and Rights: Annual Research Portfolio 2.01 Funding. The Parties agree that for each year (or for multiple years committed at one time) a part of the Annual Research Portfolio is funded by Member, the Parties shall execute a separate Research Portfolio Agreement that incorporates the terms and conditions of this Master Agreement. A sample of the Research Portfolio Agreement is attached as Exhibit A strictly for illustrative purposes, which may periodically change to be consistent with EPRI policy. Each separate Research Portfolio Agreement shall specifically identify the selections made from the Annual Research Portfolio, the duration of such engagement, and the associated Funding for such period.
2.02 Member Affiliates' ParticiPation. Any services provided by EPRI under this Agreement to one or more Member Companies shall be exclusively the obligation of Member Company that receives such services, and no other Member Company shall have any liability whatsoever in connection therewith.
EPRI acknowledges that Member Companies are severally and not jointly liable to EPRI hereunder, and that each Member Company disclaims any financial responsibility, except with respect to those services that are furnished to such Member Company, even if they are invoiced through Entergy Services, Inc (or its successor). In cases of a Project performed on behalf of multiple Member Companies, it is further agreed that each such Member Company is severally and not jointly liable to EPRI.
2.03 Program Selection.
(A) Member will allocate its payment to the selections identified in the Research Portfolio Agreement, when and if Member submits a Research Portfolio Agreement. In the event Programs or Projects are selected from EPRI's taxable subsidiary, ESI, such participation shall be pursuant to the terms and conditions of this Master Agreement. No additional agreement will be required to memorialize such participation.
(B) Should a program or product designated by Member not go forth once EPRI receives its final selections from all of EPRI's members, Member shall have the option of allocating such payment to another program or product, or of securing a refund within 30 days of the decision by EPRI to cease such program or product.
2.04 Rights for Member. In consideration of Member's Funding in support of the Annual Research Portfolio, Member shall be entitled to the benefits listed below, consistent with EPRI's then current Bylaws:
(a) Governance rights, including voting rights (one vote for all the companies that make up "Member", not one vote for each of them) for the election of members of EPRI's Board of Directors by the Membership class to which Member belongs as further set out in EPRI's Bylaws, however, the inclusion of any participating Affiliates shall not increase or otherwise alter the voting rights to which Member would otherwise be entitled under the Bylaws; (b) Access to and use by Member and its Affiliates, if any, of EPRI Materials from the Technology EPRI Master Agreement Page 3 June 2005
Innovation program in accordance with the terms of this Master Agreement; (c) Participation in EPRI's TC Program; (d) The right to participate in EPRI's advisory structure; and (e) Access to and use by Member and its Affiliates, if any, of EPRI Materials from the selections made from the Annual Research Portfolio in accordance with the terms of this Master Agreement; 2.05 TC Proqram.
(a) EPRI will provide access to Member of funds representing 25% of the dollar value of Member's Annual Research Portfolio Agreement ("Member's TC Pool"). So if the dollar value of Member's Annual Research Portfolio Agreement for 2006 is $1,000,000, Member will receive the $1,000,000-worth of research projects and any deliverables, and will have an additional $250,000 amount available to it in the Member TC Pool for use in Additional Project Opportunities. The parties agree that not all programs are eligible to establish a TC Pool as specified in the Annual Research Portfolio price sheet.
(b) When and if Member enters into a Project Opportunity Agreement with EPRI during that year or up until March 31 of the following year utilizing the TC Program, EPRI will match the new cash amount that Member provides, up to the amount in the Member TC Pool for that year.
So, using the above example, if Member enters into a Project Opportunity Agreement with ERPI for a $500,000 Project, before March 31, 2007, Member will provide $250,000 of funding and EPRI will match the amount with $250,000 from the Member TC Pool. If Member does not spend the funds by March 31 of the following year (i.e., by March 31, 2007 in the above example), then the amounts in the Member TC Pool for that year (2006 in the above example) will be deposited into the Technology Innovation Program, and no longer available to Member.
(c) If, once the Additional Project Opportunity is completed, funds remain unspent, then EPRI will notify Member. Member has two options: (1) Member may reallocate both its half of the funding and the half from the Member TC Pool to another Project Opportunity Agreement, or (2) Member may receive a refund of its half and return the other half to the Member TC Pool.
So in the above example, if $10,000 in funds remain unspent at the completion of the Additional Project Opportunity, Member may (1) reallocate both its $5,000 portion and the Member TC Pool portion to another Project Opportunity Agreement, or (2) Member may receive a refund of its $5,000 portion while the remaining $5,000 will be placed back into the Member TC Pool. Except as provided in Section 2.05(d), Member will not have access to the unused funds in the Member TC Pool after March 31 of the following year (i.e., after March 31, 2007 in the above example).
(d) If such notification of unspent funds is made after March 31 of the following year (i.e., after March 31, 2007 in the above example), Member will have 30 days from such notification either to (1) reallocate both its $5,000 portion and the Member TC Pool portion to another Project Opportunity Agreement, or (2) Member may receive a refund of its $5,000 portion while the remaining $5,000 will be allocated to the Technology Innovation Program, and will not be available to Member for use in Additional Project Opportunities.
Article 3. Funding and Rights: Additional Project Opportunities 3.01 Scope. When and if a Member Company or Member Companies desire EPRI to perform work that falls outside the Annual Research Portfolio the Parties may enter into a Project Opportunity Agreement.
The Parties agree that each time an Additional Project Opportunity is funded by Member, the specific scope EPF1I Master Agreement Page 4 June 2005
of work, term, and Funding for each Project shall be recorded and executed in a separate Project Opportunity Agreement that incorporates the terms and conditions of this Master Agreement. A sample of a Project Opportunity Agreement is attached as Exhibit B strictly for illustrative purposes, which may periodically change to be consistent with EPRI policy. A Member who funds Projects pursuant to such Project Opportunity Agreement shall be entitled to participate in the relevant project management team(s) and to receive access to and use of the relevant EPRI Materials pursuant to the license granted herein. In the event an Additional Project Opportunity is funded via the TC Program, the Parties agree such work must be consistent with EPRI's then current TC Program rules.
3.02 Commencement of Work. EPRI shall not commence work unless duly authorized representatives from both Parties have signed a Project Opportunity Agreement.
Article 4. Participation in ESI: Annual Research Portfolio (a) If Member has selected products and/or a service offered by ESI identified in the Annual Research Portfolio or Additional Project Opportunities (unless otherwise provided in an Additional Project Opportunity or other agreement with ESI), then the provisions of this Master Agreement shall apply to ESI, and ESI shall become a party to the subsequent Research Portfolio Agreement.
(b) Member will allocate its payment to ESI for the ESI project(s) designated on each Research Portfolio Agreement, when and if Member submits a Research Portfolio Agreement. Member understands that it shall not be entitled to EPRI membership in the event all of its designated products and/or services are those of ESI, and no qualifying EPRI Program is selected. ESI is not a membership organization; therefore, any membership benefit conferred by the terms of this Master Agreement for EPRI membership shall not apply to Member's relationship with ESI.
(c) To the extent a product and/or service is selected from ESI, ESI will use commercially reasonable efforts to perform and manage (or caused to be performed by outside contractors) all research and other activities associated with such product and/or service and to deliver results for the benefit of Member. Member understands that the conduct of research is inherently uncertain.
Accordingly, ESI will not guarantee or warrant the outcome of such products and/or services or their results to Member. Member understands that ESI, in its sole discretion and after consultation with Funding Members, may modify the scope of work, its anticipated results, and the anticipated Deliverables at any time. Ownership, title and Member's right to use the products, services and/or results produced by ESI will be pursuant to Article 5. Upon execution of a Research Portfolio Agreement by a duly authorized representative of ESI, any reference to EPRI in Article 5 shall apply equally to ESI, with the exception of subarticle 5.08(D), which shall apply directly to ESI without change.
(d) In the event Member has selected products and/or services associated with ESI, Member acknowledges and accepts that it is contracting for those projects directly with ESI instead of EPRI and that ultimate responsibility for performance of such research, any liability associated with such research, delivery of the products, services and/or results, collection of funds associated with such effort and completion of all Deliverables agreed to therein rests solely with ESI and not with EPRI. EPRI is acting solely as a collection agent for ESI in this capacity.
Article 5. General Provisions Governing Participation In the Annual Research Portfolio and Additional Project Opportunities 5.01 Internal Use License. In consideration for the Funding made by Member pursuant to each Research Portfolio Agreement or separate Project Opportunity Agreement, and subject to the terms of this Master Agreement, EPRI hereby grants Member and its Affiliates a paid-up, nonexclusive, nontransferable, perpetual license to use the EPRI Materials from those activities, and to allow third parties providing services to Member or its Affiliates, and only for the purpose of providing services to Member or its Affiliates, on a worldwide basis, subject to any export control restrictions, solely for EPRI Master Agreement Page 5 June 2005
Member's internal business purposes and not for the benefit of any third party. No commercial (make or sell) or consulting license is granted herein. In the event Member desires to obtain a commercial or consulting license, the parties must first determine exact royalty payments, if any, that would be due EPRI.
5.02 License Restrictions.
(A) Except as set forth herein, Member shall not, directly or indirectly, without EPRI's prior written consent:
(i) disclose to or allow the use of EPRI Materials by any third party unless otherwise provided for herein; (ii) use any method to obtain the human readable computer program source code version of EPRI Materials through decompilation, reverse engineering or otherwise; (iii) use any EPRI Materials or EPRI Confidential Information to create materials which are substantially similar to EPRI Materials; (iv) remove or alter EPRI's proprietary rights, limitation of liability, restricted rights and other notices in EPRI Materials or copies thereof; (v) translate any EPRI reports or software into a foreign language; (vi) sublicense, encumber, time-share, rent, or lease the EPRI Materials; or (vii) use the EPRI Materials for third party consulting or commercial purposes.
(B) Member may create Derivative Works and translations of the Deliverables, excluding 8oftware provided the following shall apply:
(i) Member's preparation and use of any Derivative Works shall be limited to the conditions set forth in subarticle 5.01, above, and the terms of this Master Agreement unless otherwise provided below; and (ii) Member's preparation and use of Derivative Works shall be at Member's own risk, and such preparation and use shall specifically exclude any EPRI Representation, Warranties and Indemnity provided in subarticle 5.10 below.
5.03 Title to EPRI Materials.
(A) Except for rights expressly granted in this Article, EPRI shall retain all right, title and interest in EPRI Materials created exclusively by EPRI, and Member hereby waives any ownership right therein. To the extent that Member or an Affiliate contributes to EPRI Materials, the applicable Member or Affiliate shall retain ownership of the contributed portion (provided that EPRI has not paid Member of Affiliate to create such contribution). Provided, however, that with respect to Derivative Works that Member creates, Member shall retain all right, title and interest in such Derivative Works. Except for the license granted to Member in 5.01 above and pursuant to this subarticle 5.03, EPRI reserves all rights and remedies under copyright, trademark, patent, service mark, trade secret, unfair competition and other applicable laws.
(B) All deliverables funded exclusively by Member or an Affiliate, regardless of Member's input, shall be and will remain the exclusive property of Member or an Affiliate, and all right, title and interest therein (including, without limitation, copyright and patent rights) shall vest in Member or Affiliate, and shall, to the fullest extent permitted by law, constitute "work made for hire" under United States copyright law. EPRI shall execute such documents and do such things as may be necessary to effectuate this subarticle 5.03 (B) and to ensure that such deliverable shall become the sole property of Member or an Affiliate, and shall require each of its employees and any employees of its subcontractors to do the same, allat EPRI's sole cost and expense. To the extent necessary to effectuate this subarticle 5.03(B), EPRI hereby assigns to Member its interests in (i) any deliverable that it creates for Member pursuant to a Project Opportunity Agreement and (ii) Derivative Works that Member creates.
5.04 EPRI License Support. EPRI shall have no obligation to provide support or maintenance to Member in connection with any license granted hereunder, unless specifically provided for in the particular Research Portfolio Agreement or Project Opportunity Agreement.
5.05 Member License Grant. Unless otherwise provided in a Protect Opportunity Agreement, Member hereby grants EPRI an unrestricted license to publish a summary report regarding the results of EPRI's Annual Research Portfolio and/or Additional Project Opportunities, provided that such report does not contain Confidential Information of Member or otherwise Identify Member or its Affiliates in such a summary report.
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5.06 Ordering EPRI Materials. Member may only order Deliverables released by EPRI during any term of participation. Research Results may be ordered from the EPRI Distribution Center or downloaded from EPRI's website.
5.07 Nature of Research. EPRI agrees to use commercially reasonable efforts to perform and manage (or cause to be performed by outside contractors) the activities described in each Research Portfolio Agreement or Project Opportunity Agreement, and to provide Member with the Deliverables.
Member understands that the conduct of scientific research is inherently uncertain; thus, EPRI, in its sole discretion and after consultation with all Funding Members, may modify the scope of work, its anticipated results, and the anticipated Deliverables at any time.
5.08 Payment.
(A) Payment is due Net 30 days from receipt of EPRI's properly prepared and timely provided invoice. All payments shall be made in U. S. Dollars, and shall not be reduced by charges, taxes, duties or offsets of any kind or nature imposed by any governmental agency or authority of Member's domiciliary country or of any country other than the United States of America, for which Member has sole payment responsibility (including any transportation and insurance costs related to shipment of physical items).
Any purchase order issued by Member pursuant to a Research Portfolio Agreement and/or an Additional Project Opportunity Agreement is solely for Member's internal accounting requirements and, as such, the terms and conditions of such purchase order are hereby superseded by the terms and conditions set forth in this Master Agreement.
(B) For Member's support of the Annual Research Portfolio, EPRI shall invoice and Member shall pay the fees in quarterly installments, in accordance with the provisions of subarticle 5.08(A) above.
(C) For Member's support of the Additional Project Opportunities, if any, EPRI shall invoice the entire amount for the first year identified in such agreements upon execution thereof. Payment of such invoices shall be pursuant to subarticle 5.08(A) above. All future annual funding for Additional Project Opportunities, if any, shall be due and payable no later than January 31st of each succeeding year, but in no case, sooner than the time period stated in subarticle 5.08(A) above.
(D) In the event Member selects products and/or services offered by ESI identified in the Annual Research Portfolio, EPRI shall invoice and Member shall pay said invoice pursuant to subarticle 5.08(A) above. EPRI shall then transfer all funding for such selections to ESI on behalf of Member.
5.09 Confidential Information.
(A) Each party to this Master Agreement may provide to one another information that is Confidential Information. The parties agree that all EPRI Materials and EPRI Intellectual Property Rights that are not publicly known are EPRI Confidential Information. All information which is considered Confidential Information by Member must, prior to its disclosure: (a) be labeled as "Confidential" or otherwise clearly identified as confidential; or (b) if disclosed orally, be identified as confidential when disclosed, and be reduced to writing, marked as "Confidential" and delivered to EPRI within twenty days of such oral disclosure. Confidential Information shall not include information which: (i) is or becomes generally available to the public through no act or omission of the receiving party, but only when such information becomes public; (ii) was in the receiving party's lawful possession prior to the disclosure and had not been obtained by the receiving party either directly or indirectly from the disclosing party; (iii) is lawfully disclosed to the receiving party by a third party without restriction on disclosure; (iv) is independently developed by the receiving party; or (v) is disclosed by operation of law, provided that, the recipient promptly notifies the discloser of its obligation to disclose.
(B) Protection of Confidential Information. The Parties agree to hold the other's Confidential Information in confidence in perpetuity. Disclosure of the other Party's Confidential Information shall be strictly limited to the parties' employees, consultants, contractors, and governmental agencies for regulatory compliance or request purposes, on a need to know basis only and subject to a written agreement which protects EPRI Master Agreement Page 7 June 2005
such Confidential Information at least as well as this Master Agreement. Member shall provide EPRI with an English language copy or translation of each such nondisclosure agreement upon EPRI's request.
(C) Member's Confidential Information Regarding Its Affiliates. The Parties agree that Confidential Information shall specifically include any information provided regarding Member and Member's Affiliates, as required in each Research Portfolio Agreement. For any such Confidential Information regarding Member and its Affiliates, EPRI agrees to hold said Confidential Information in strict confidence and not to disclose any part of it to others except as expressly permitted in this Agreement. EPRI further agrees not to use Member's Confidential Information except to fulfill its responsibilities contained in this Agreement or pursuant to a Research Portfolio Agreement or Project Opportunity Agreement.
(i) EPRI may disclose said Confidential Information only to its directors, officers, employees, agents or attorneys ("Representatives") who have a need to know. However, prior to doing so, EPRI shall provide any such Representative(s) with a copy of this Agreement and require that he/she/they agree to the terms and conditions hereof by executing a copy of the Nondisclosure Certificate (the "Certificate") attached hereto and incorporated herein as Exhibit C. EPRI shall provide a copy of such Certificate to Member, at the address stated at the bottom of Exhibit C, prior to disclosing any Confidential Information to such Representative. Notwithstanding the foregoing, EPRI shall be responsible for any breach of this Agreement by any of its Representatives.
(ii) Upon the written request of Member, but in no event later than ten (10) days after the expiration of this Agreement, EPRI shall return all Confidential Information in its possession to Member or, at the option of Member, shall destroy all Confidential Information. If Member chooses the latter option, EPRI shall provide evidence of such destruction by certifying same in writing to Member.
(iii) Member shall be entitled to equitable relief, including injunction and specific performance, in the event of a breach or threatened breach of this subarticle. EPRI further waives any requirement that Member post a bond in connection with obtaining any such equitable relief, and agrees that any violation of this subarticle may cause irreparable injury or harm to Member. In the event of a breach or threatened breach of this subarticle, such remedies shall be in addition to any other remedies available to Member at law or equity.
5.10 EPRI Representations, Warranties and Indemnity.
(A) EPRI represents and warrants that it has the right to grant the license and other rights in this Master Agreement. EPRI warrants that the EPRI Materials do not infringe third party intellectual property rights. EPRI does not guarantee or warrant the outcome of the research or the anticipated Deliverables to Member.
EPRI hereby represents and warrants that it has the full right and authority to enter into this Master Agreement with Member.
(B) DISCLAIMER OF OTHER WARRANTIES. EXCEPT FOR THE FOREGOING EXPRESS LIMITED WARRANTIES, MEMBER ACCEPTS THE EPRI MATERIALS "AS IS," WITH NO OTHER WARRANTIES OR CONDITIONS OF ANY KIND, EXPRESS OR IMPLIED INCLUDING, WITHOUT LIMITATION, WARRANTIES OF NON-INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. EXCEPT FOR DAMAGES REALTED TO BREACHES OF CONFIDENTIALITY AND EPRI'S INDEMNITY OBLGIATIONS, THE LIABILITY OF EPRI, ITS SUBSIDIARY, SUPPLIER OR SUBCONTRACTOR TO MEMBER FOR A CLAIM OF ANY KIND RELATED TO THIS MASTER AGREEMENT, ANY EPRI MATERIALS OR ANY EPRI SERVICE, WHETHER FOR BREACH OF CONTRACT OR WARRANTY, STRICT LIABILITY, NEGLIGENCE OR OTHERWISE, SHALL NOT EXCEED $500,000. EXCEPT FOR DAMAGES REALTED TO BREACHES OF CONFIDENTIALITY AND EPRI'S INDEMNITY OBLGIATIONS, IN NO EVENT WILL EITHER PARTY, OR ANY SUBSIDIARY, SUPPLIER, OR SUBCONTRACTOR OF EPRI BE LIABLE TO MEMBER FOR INDIRECT, SPECIAL, INCIDENTAL OR CONSEQUENTIAL DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST REVENUES OR PROFITS, LOST DATA, WORK STOPPAGE, COMPUTER FAILURE OR MALFUNCTION), EVEN IF ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
(C) Indemnification by EPRI. EPRI shall indemnify, defend and save Member and Member's Affiliates harmless from and against any damages, costs, fees, claims, loss, expense (including reasonable EPRI Master Agreement Page 8 June 2005
attorney fees) or judgment related to unmodified Deliverables and EPRI Materials arising as the result of a third party claim for intellectual property infringement to the extent such claim does not arise in whole or in part, due to Members use of the EPRI Materials in contravention of this Master Agreement, if Member promptly gives EPRI written notice of the claim, Member provides all reasonable assistance to EPRI requests, and EPRI controls the defense or settlement of the claim, provided however, that ERPI may not settle or compromise such claim or lawsuit without the written consent of Member if any settlement or compromise requires Member to part with any right or make any payment not indemnified or subjects Member to any injunction. Subject to the foregoing, Member shall have the right, at its option and expense, but not the obligation, to retain advisory counsel to represent its interests in defending any such claim or lawsuit. If any action results in an injunction against Member with respect to EPRI Materials or Deliverables, provided pursuant to this Agreement or any document issued against it, or in the event the use of the EPRI Materials or Deliverables, or any part thereof, is, in such suit, held to constitute infringement, EPRI agrees that it shall use best efforts to either (1) procure for Member the right to continue using the infringing subject matter, or (2) replace the infringing EPRI Materials or Deliverables with non-infringing items of equivalent value and functionality or modify the same so that they become non-infringing and retain their full value and functionality. Any obligations to reperform the work are contingent upon approval by the other member/funders and EPRI having adequate Funds.
5.11 Member Representations, Warranties and Indemnity.
(A) Member understands and agrees that EPRI shall have no responsibility for any inter-company cost allocation of the EPRI participation payments between the Member and its participating Affiliates that may be required of them under applicable law or regulation.
(B) Member Companies hereby represents and warrants that they have the full right and authority to enter into this Master Agreement with EPRI, and be bound to the terms and conditions contained herein, including but not limited to all export restrictions, applicable governing law and any dispute resolution provisions. Member Companies further represent and warrant that their signatures herein below do bind them to this Master Agreement. In the event Affiliates are not wholly owned companies, each Affiliate shall enter into a separate license agreement with EPRI prior to having access to or using any EPRI Materials.
(C) Member represents and warrants that before it provides any third party proprietary or confidential information to EPRI for use in connection with any research activity, it will secure all necessary rights and licenses on behalf of EPRI.
(D) Indemnification by Member. Member agrees to indemnify, defend and hold EPRI and EPRI's Affiliates harmless from and against all damages, costs, fees, claims, loss, expense (including reasonable attorney fees) or judgment arising from a third party's claim that Members use of EPRI Materials was tortious or involved willful misconduct and/or breach of Members obligations hereunder.
5.12 Termination of Additional Proiect Opportunities.
(A) Termination for Cause of Additional Project Ooportunitv. EPRI may, on written notice, terminate a Project Opportunity Agreement including the License, if: (i) Member breaches the funding, confidentiality, proprietary rights or license provisions hereof, (ii) insolvency or bankruptcy proceedings are voluntarily or involuntarily instituted against Member (Member shall give immediate notice to EPRI of its knowledge of such proceedings), (iii) Member attempts to assign this Master Agreement or individual Project Opportunity Agreements without EPRI's written approval, or (iv) Member substantially discontinues its business. EPRI may take such action in any instance above, if Member fails to cure the breach within sixty (60) days after being notified by EPRI of such breach. Member may terminate individual Project Opportunity Agreements, including the License itself, should EPRI fail to cure a breach of the Master Agreement within sixty days of written notification by Member.
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(B) Effect of Termination for Cause of Additional Proiect Opportunity. If individual Project Opportunity Agreements are terminated pursuant to this subarticle, then Member shall cease use of the EPRI Materials from the Project, and within thirty (30) days of termination, Member shall return all EPRI Materials and any reproductions thereof, and uninstall or otherwise permanently delete all EPRI Materials from Member's computer systems, and provide EPRI with written certification of such actions signed by a duly authorized representative of Member.
(C) Termination for Convenience of Additional Proiect Opportunity.
(i) For Additional Project Opportunities in which Member is the sole funder, Member may terminate its participation at any time upon at least sixty (60) days prior written notice to the other party. If Member terminates for convenience, EPRI shall refund any excess Funds received from Member after deducting Project costs incurred up to the effective date of termination (including but not limited to non-cancelable commitments based on Members Funding), and reasonable termination costs, if any. If EPRI terminates for convenience, EPRI shall refund all Funds received from Member.
(ii) For Additional Project Opportunities in which there are multiple funders, Member may terminate its participation at any time upon at least sixty (60) days prior written notice to EPRI, however, the effective date of such termination shall be December 31 of the year in which notice is given. Member shall not be entitled to a refund of any portion of its Funding provided through the date of termination, nor shall it be entitled to receive Deliverables produced after the effective date of termination.
5.13 Unspent Funds Followinq Completion of Additional Proiect Opportunity. The Parties agree upon completion of work in an Additional Project Opportunity, EPRI shall notify Member of any unspent Funds attributable to Member, via email communication to the designated Manager of EPRI Technology Transfer. In the event Member's share of unspent Funds is less than two thousand five hundred dollars
($2500), EPRI shall not be required to refund said amount to Member, and EPRI shall be free to reallocate such Funds to EPRI's Technology Innovation program. In the event Members share of unspent Funds is equal to or greater than two thousand five hundred dollars ($2500), Members share shall be refunded or, at Members option, may be reallocated to another Additional Project Opportunity.
5.14 Survival. The provisions of Subarticle 5.01 through 5.02 (Internal Use License and License Restrictions), Subarticle 5.09 (Confidentiality), Subarticles 5.10 and 5.11 (Representations, Warranties and Indemnity), Subarticle 5.12 (Termination of Additional Project Opportunities), Subarticle 5.15 (Dispute Resolution) and Subarticle 5.16 (Miscellaneous) shall survive the termination of any Research Portfolio Agreement, any Project Opportunity Agreement, or this Master Agreement.
5.15 Dispute Resolution.
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(A) General. The Parties will attempt to resolve any dispute that may develop between them under this Agreement or a Project Opportunity Agreement. However, if the Parties are unable, at their discretion, to resolve such a dispute, either Party may demand arbitration conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association ("AAA"), including "expedited procedures," if applicable, but without regard to the amount in dispute, unless either Party objects in writing to the use of such expedited procedures. Except as provided in this arbitration section, the Commercial Arbitration Rules of the American Arbitration Association shall govern the process of the dispute's resolution.
(B) Limits. The arbitrators will be limited to ruling for the recommended value or recommended findings or outcome of either Party, as submitted to the arbitrators by the Parties at the arbitration proceeding, but without the right or ability to determine another value, finding or outcome.
(C) Procedure. Unless the dispute is subject to expedited procedures, in which case the arbitrators will be appointed by the AAA in accordance with its rules for expedited procedures, concurrent with making such a demand, the demanding Party will specify the name and address of the arbitrator selected by it. The other Party will, within twenty (20) days of receipt of the arbitration demand, select its arbitrator.
If either Party fails to select an arbitrator in a timely manner, then the other Party may request that the AAA appoint the other arbitrator within fifteen (15) days of such request. The two arbitrators thus selected will, within fifteen (15) days of the selection of the second arbitrator, select the third arbitrator, who will chair the arbitration panel and bring to the proceeding subject-matter expertise on the matter to be arbitrated. Should the two Party-appointed arbitrators fail to appoint the third arbitrator timely, then either Party may request that the AAA appoint a third arbitrator within fifteen (15) days of such request.
(D) Substantive Law. To the extent that the recommendations of the Parties concerning value, findings, or outcome do not address issues raised during the proceeding, the arbitrators will apply the substantive laws of the state of 'state listed under this Agreement's Governing Law provision. The parties agree that if more than Member, Affiliate and or EPRI are involved in a dispute, the venue will be California.
(E) Time; effect: costs. The Parties will proceed with the arbitration expeditiously with the intent that a decision be rendered within one hundred twenty (120) days from the filing of the demand for arbitration by the initiating Party. The arbitrator's decision will be final and binding on both Parties, and may be enforced in any court having jurisdiction. Each Party will bear its own expenses, including reasonable attorney fees in connection with arbitration undertaken pursuant to this arbitration section. The arbitrators will apportion their fees and expenses, the filing fee and other administrative costs in the award based upon the respective merit of the positions of the Parties.
5.16 Miscellaneous (A) Governing Law. This Master Agreement, each Research Portfolio Agreement and any Project Opportunity Agreement shall be governed by and construed in accordance with the laws of the State of California, without reference to conflict of law principles. In the event of any discrepancies between the English and foreign language version of this Master Agreement, any Research Portfolio Agreement, and/or any Additional Project Opportunity Agreement, the English version shall prevail.
(B) Export Laws. Member shall comply with all laws, rules and regulations including, without limitation, all U. S. and foreign export laws and regulations. The Parties acknowledge and agree that compliance with such laws and regulations may delay or in rare cases prevent the delivery to Member of EPRI Materials. The Parties agree that access to the EPRI Materials is hereby granted with the specific understanding and requirement that Member is solely responsible after delivery for compliance with all applicable U. S. and foreign export laws and regulations. This responsibility includes an obligation to ensure that any individual receiving access hereunder who is not a U. S. citizen or permanent U. S.
resident is permitted access under applicable U.S. and foreign export laws and regulations. Although EPRI may make an informal assessment of the applicable U. S. export classification for specific EPRI Materials, Member acknowledges that this assessment is solely for informational purposes and not for EPRI Master Agreement Page 11 June 2005
reliance purposes. Member acknowledges that it is still the obligation of the Member to make its own assessment of the applicable U. S. export classification and to ensure compliance accordingly.
(C) Assignment. This Master Agreement, any Research Portfolio Agreement, and any Project Opportunity Agreement may not be assigned, in whole or in part, by Member or EPRI without the prior written consent of the other party; such consent shall not be unreasonably withheld. The terms of this Master Agreement, any EPRI Research Portfolio Agreement, and any Project Opportunity Agreement shall bind and inure to the benefit of permitted assigns. Any attempted assignment in contravention of this subarticle shall be deemed null and void.
(D) Waiver. No failure or successive failures on the part of either party, its successors, or assigns, to enforce any covenant or agreement, and no waiver or successive waivers on its or their part of any condition of this Master Agreement, any Research Portfolio Agreement, and any Project Opportunity Agreement, shall operate as a discharge of such covenant, agreement, or condition, or render the same invalid, or impair the right of either party, its successors and assigns, to enforce the same in the event of any subsequent breach or breaches by the other party, its successors, or assigns.
(E) Notices. Any notice, demand, request, or other communication or document to be provided under this Master Agreement to a Party to this Master Agreement ("Notice") shall be in writing, and shall be given to the Party at its address or telecopy number set forth in the signature block in each EPRI Research Portfolio Agreement or any Project Opportunity Agreement, or to such other address or telecopy number as the Party may later specify for that purpose by notice to the other Party. Each Notice shall be deemed given and received: (i) if given by telecopy, when the telecopy is transmitted and confirmation of complete receipt is received by that transmitting Party during normal business hours or on the next business day if not confirmed during normal business hours; (ii) if hand delivered or given by overnight delivery service such as Federal Express, the day on which the notice is actually delivered to the address listed herein (whether or not delivered to the Party); (iii) if delivered by international courier, the day on which the notice is actually delivered to the address listed herein, or (iv) if given by normal or certified U.S. mail, two (2) business days after it is posted with the U.S. Postal Service. A copy of legal notices shall be sent to the attention of EPRI's and Member's Legal departments.
(F) Entire Agreement. This Master Agreement, including each concurrent or subsequent Research Portfolio Agreement, and/or any Project Opportunity Agreement, constitutes the entire agreement between the parties and supersedes all previous agreements and understandings. This Master Agreement, any Research Portfolio Agreement, and any Project Opportunity Agreement may not be altered, amended, or modified except by a written instrument signed by the duly authorized representatives of both Parties. If any provision of this Master Agreement, any Research Portfolio Agreement, and any Project Opportunity Agreement is held to be invalid or unenforceable, the remaining provisions of this Master Agreement, any Research Portfolio Agreement, and any Project Opportunity Agreement shall remain in full force.
(G) Independent Contractor. Nothing contained herein shall be construed to-imply a joint venture, partnership, or principal and agent relationship between the Parties, and neither Party shall have any right, power, or authority to create any obligation, express or implied, on behalf of the other in connection with the performance hereunder.
(H) Restricted Rights. EPRI Materials are provided hereunder with Restricted Rights - Use, duplication, or disclosure by the United States Government is subject to restrictions as set forth in subparagraph (g)(3)(i), excluding section (g)(3)(i)(b)(5), of the Rights in Technical Data and Computer Software clause at FAR 52.227-14, Alternate III, as amended.
(I) Force Majeure. Any delay in the performance of any duties or obligations of either party (except the payment of money owed) will not be considered a breach if such delay is caused by a shortage of materials outside of EPRI's control, fire, earthquake, flood, or any other event beyond the control of such Party, provided that such Party uses reasonable efforts, under the circumstances, to notify the other Party of the circumstances causing the delay and to resume performance as soon as possible.
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(J) Order of Precedence. In the event of any conflict between this Master Agreement, any Research Portfolio Agreement, and any Project Opportunity Agreement, the terms and conditions of individual Research Portfolio Agreement or any Project Opportunity Agreement shall prevail and take precedence unless otherwise expressly superseded by the Parties.
(K) Interpretation of Agreement. The section and other headings in this Master Agreement are inserted solely as a matter of convenience and for reference, and shall be given no effect in the construction or interpretation of this Master Agreement. Unless the context of this Master Agreement otherwise clearly requires, references in the plural form include the singular and vice versa. This Master Agreement has been freely negotiated by all Parties and in the event there is any controversy, dispute, or claim involving the meaning, interpretation, validity, or enforceability of this Master Agreement or any of its terms or conditions, there shall be no inference, presumption, or conclusion drawn against a Party by virtue of such Party having drafted this Master Agreement or any portion hereof. When used herein, the words "include" and "including" shall be construed as "include, without limitation" and "including, without limitation."
EPRI Master Agreement Page 13 June 2005
THUS DONE AND EXECUTED by the following duly authorized representatives of the parties:
Entergy Services, Inc. Electric Power Research Institute, Inc. ("EPRI")
Entergy Arkansas, Inc.
Entergy Gulf States, Inc. Post Office Box 10412 Entergy Louisiana, LLC 3420 HilIview Ave.
Entergy New Orleans, Inc. Palo Alto, CA 94303 Entergy Mississippi, Inc. Telephone 650-855-1088 Entergy Nuclear, Inc. Fax 650-855-2166 Entergy Nuclear Generation Company Entergy Nuclear Operations, Inc.
Entergy Operations, Inc.
Entergy Operations Services, Inc.
Entergy Nuclear Vermont Yankee, LLC Entergy Nuclear Indian Point 2, LLC AW:: ýý, WILFOb DGW / I At Xn(.
A*h6orized Signature for EPRI fQ1./ / Date Entergy Nuclear Indian Point 3, LLC Entergy Nuclear Fitzpatrick, LLC Norma Formanek / Vice President and General Counsel TLG Services, Inc. Printed Name of EPRI's Authorized Signatory / Title (collectively, '-Member Companies")
Address for Member Companies:
Entergy Services, Inc.
639 Loyola Avenue New Orleans, LA 70113 Telephone: 504-576-5353 Facsimile: 504-576-6979 EPRI Solutions, Inc. ("ESI")
/ Post Office Box 10412 Mark T. Savoff, / Date 3420 Hillview Ave.
Executive Vice President - Operations Palo Alto, CA 94303 Telephone 650-855-Authorized Signature for: Fax 650-855-Entergy Services, Inc.
Entergy Arkansas, Inc.
Entergy Gulf States, Inc.
,* fo Entergy New Orleans, Inc. Auth(*'ed Signature for ESI / Date Entergy Mississippi, Inc.
Entergy Nuclear, Inc.
Entergy Nuclear Generation Company Entergy Nuclear Operations, Inc. Printed Name of ESIs Authorized Signatory / Title Entergy Operations, Inc.
Entergy Operations Services, Inc.
Entergy Nuclear Vermont Yankee, LLC Entergy Nuclear Indian Point 2, LLC Entergy Nuclear Indian Point 3, LLC Entergy Nuclear Fitzpatrick, LLC Steven C. McNeal / Date Vice President and Treasurer Authorized Signature for:
TLG Services. Inc.
TLG Services, Inc EPRI Master Agreement Page 14 June 2005
SELECTRIC POWER RESEARCH INSTITUTE EXHIBIT A - Sample of 2006 Research Portfolio Agreement For (Member)
- 1. TERM: January 1, - through December 31, . The terms and ýconditions of the Master Agreement between the Parties effective on January 1, 2006 are incorporated herein and govern all research selected hereunder.
- 2. DESIGNATED MEMBER COMPANIES':
Member Companies 2 Company Name/ State and Country of Ownership Gross Bueines or Main Organization/ Location o* Pirincipai Annual Activities Office " . Revenues in Entergy'Services, Inc. NA Utility Operations Entergy Arkansas, Inc, NA,: Utility Operations Entergy Gulf States, inc. NA Utility Operations Entergy Louisiana, LLC NA Utility Operations Entergy New Orleans, I. NA Utility Operations Entergy Mississippi, Inc. NA Utility Operations Entergy Nuclear, Inc. NA Nuclear Operations Entergy Nuclear Generation Company NA Nuclear Operations Entergy Nuclear Operations, Inc. NA Nuclear Operations Entergy Operations, Inc. NA Nuclear Operations Entergy Operations Services, Inc. NA Utility Services Entergy Nuclear Vermont Yankee, LLC NA Nuclear Operations Entergy Nuclear Indian Point 2, LLC NA Nuclear Operations Participating Affiliates require the identification of applicable pricing metrics prior to inclusion under this Agreement. Overall prices may be affected. Please contact your EPRI Account Executive for specifics prior to submitting the Research Portfolio Agreement.
2 Additional data may be required. All data will be used by EPRI solely for the purpose of price calculations, and will be kept confidential.
EPRI Master Agreement Page 15 June 2005
Entergy Nuclear Indian Point 3, LLC NA Nuclear Operations Entergy Nuclear Fitzpatrick, LLC NA Nuclear Operations TLG Services, Inc. NA Nuclear Services Total
- 3. PROGRAM/PROJECT SELECTIONS (Price Sheet or selection tabulation (Int'l), please see Attachment 1).
- 4. ESI PRODUCT AND/OR SERVICES SELECTIONS (Please see Attachment 2).
- 5. SPECIAL TERMS AND CONDITIONS GOVERNING THE RESEARCH PORTFOLIO SELECTIONS.
THUS DONE AND EXECUTED by the following duly authorized representatives of the parties:
Printed Business Name of Member Electric Power Research Institute Post Office Box 10412 3420 Hillview Ave.
Palo Alto, CA 94303 Business Address City, State, Zip Telephone 650-855-1088 Fax 650-855-2166 Telephone Number " Fax Number Authorized Signature for Member / Date Authorized Signature for EPRI I Date Printed Name of Member's Authorized Signatory / Title Printed Name of EPRI's Authorized Sionatorvy Title By signing below, ESI agrees to the terms of the Mastr Agreement which are incorporated by reference herein, and the&
selection of products and services (if any) identified ?in Attachment 2.
Post Office Box 10412 3420 Hillview Ave. .
Palo Alto, CA 94303,, .
Telephone 650-855-n Fax 650-855-Authorized Signature for ESI / Date.
Printed Name of ESI's Authorized Signatory /ITitle EPRI Master Agreement Page 16 June 2005
ar ri2I EESELECTRIC POWER RESEARCH INSTITUTE EXHIBIT B - Sample of Project Opportunity Agreement
- 1. Prolect Title, A-greement and Transaction Numbers: This. Project Opportunity Agreement applies to the Project entitled. The Parties will reference Project Opportunity Agreement number in all correspondence. The terms and conditions of the Master Agreement between the Parties dated are incorporated herein and govern all Work hereunder.
- 2. Contact Information:
Contact Name Telephone Fax Email EPRI PM:
EPRI Contracts:,
EPRI Client Relations:
Member Contracts:
Member Project Manager:
MemberAccounts Payable
- 3. Prolect Funding:
Funds: Yearflype 2006 2006 2007 2008 Total Funds Member $ $ $
Member TC Pool Funds $ $ $ $
Total Funding ,, . $ $ $ $
- 4. Statement of Work:
- 5. Proiect Tasks:
- 6. Invoiclna Information:
7 Proiect Deliverables:
THUS DONE AND EXECUTED by the following duly authorized representatives of the parties:
("Member') Electric Power Research Institute, Inc.
Printed Business Name of Member Post Office Box 10412 3420 Hillview Ave.
Palo Alto, CA 94303 Telephone 650-855-Business Address City, State, Zip Fax 650-855-( . / (-
Telephone Number / Fax Number Authorized Signature for Member / Date Authorized Signature for EPRI / Date Printed Name of Member's Authorized Signatory / Title Printed Name of EPRI's Authorized Signatory / Title EPRI Master Agreement Page 17 June 2005
Exhibit C NondisclosureCertificate FOR USE WITH THE EPRI RESEARCH PORTFOLIO AGREEMENT
- 1. Pursuant to the terms and conditions of above-listed Agreement, I understand that Confidential Information may be provided to me regarding Member's Affiliates. I certify that I have been given a copy of the Agreement, have read it, and agree to the terms and conditions therein.
- 2. I understand that the Confidential Information regarding Members Affiliates, and any notes, memoranda, or any other form of information regarding or derived from the Confidential Information, shall not be disclosed to anyone other than in accordance with the terms of the Research Portfolio Agreement and shall be used only for the express and limited purpose set forth therein.
Representing: (P(7 Date:
+
Please return completed Nondisclosure Certificates to:
Mark Bruckner EPRI Master Agreement Page 18 June 2005
UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Before the Atomic Safety and Licensing Board In the Matter of )
)
Entergy Nuclear Vermont Yankee, LLC ) Docket No. 50-271-LR and Entergy Nuclear Operations, Inc. ) ASLBP No. 06-849-03-LR (Vermont Yankee Nuclear Power Station)))
CERTIFICATE OF SERVICE I hereby certify that copies of "Opposition to NEC's Motion to Compel" dated April 21, 2008, were served on the persons listed below by deposit in the U.S. Mail, first class, postage prepaid, and where indicated by an asterisk by electronic mail, this 21st day of April, 2008.
- Administrative Judge *Administrative Judge Alex S. Karlin, Esq., Chairman Dr. Richard E. Wardwell Atomic Safety and Licensing Board Atomic Safety and Licensing Board Mail Stop T-3 F23 Mail Stop T-3 F23 U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, D.C. 20555-0001 Washington, D.C. 20555-0001 ask2@nrc.gov rewgnrc.gov
- Administrative Judge
- Secretary William H. Reed Att'n: Rulemakings and Adjudications Staff 1819 Edgewood Lane Mail Stop 0-16 C I Charlottesville, VA 22902 U.S. Nuclear Regulatory Commission whrcville@embarqmail.com Washington, D.C. 20555-0001 secy@nrc.gov, hearingdocketgnrc.gov Office of Commission Appellate Adjudication Atomic Safety and Licensing Board Mail Stop 0-16 C1 Mail Stop T-3 F23 U.S. Nuclear Regulatory Commission U.S. Nuclear Regulatory Commission Washington, D.C. 20555-0001 Washington, D.C. 20555-0001
- Lloyd Subin, Esq. *Sarah Hofmann, Esq.
- Mary Baty, Esq. Director of Public Advocacy Office of the General Counsel Department of Public Service Mail Stop 0- 15 D21 112 State Street - Drawer 20 U.S. Nuclear Regulatory Commission Montpelier, VT 05620-2601 Washington, D.C. 20555-0001 Sarah.hofmanngstate.vt.us LBS3@nrc.gov; mcb1@nrc.gov
- Anthony Z. Roisman, Esq. *Ronald A. Shems, Esq.
National Legal Scholars Law Firm *Karen Tyler, Esq.
84 East Thetford Road Shems, Dunkiel, Kassel & Saunders, PLLC Lyme, NH 03768 9 College Street aroisman(anationalleaalscholars.com Burlington, VT 05401 rshemsCsdkslaw.com ktylergsdkslaw.com
- Peter L. Roth, Esq. *Marcia Carpentier, Esq.
Office of the New Hampshire Attorney General Atomic Safety and Licensing Board Panel 33 Capitol Street Mail Stop T-3 F23 Concord, NH 03301 U.S. Nuclear Regulatory Commission Peter.roth(doi.nh.gov Washington, D.C. 20555-0001 mxc7@nrc.gov 2
April 21, 2008 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Before the Atomic Safety and Licensing Board In the Matter of )
)
ENTERGY NUCLEAR VERMONT )
YANKEE, LLC and ENTERGY NUCLEAR)
OPERATIONS, INC. ) Docket No. 50-271-LR
))
(Vermont Yankee Nuclear Power Station) ) ASLBP No. 06-849-03-LR NOTICE OF APPEARANCE Alan A. Pemberton, being an attorney at law in good standing admitted to practice before the courts of the District of Columbia, as well as various federal courts, hereby enters his appearance as counsel on behalf of Electric Power Research Institute in any proceeding related to the above-captioned matter.
Respectfully COVIKTON & BURLING LLP 1201 Pennsylvania Avenue, N.W.
Washington, DC 20004-2401 Telephone: (202) 662-5642 Facsimile: (202) 778-5642 e-mail: apemberton@cov.com
April 21, 2008 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION Before the Atomic Safety and Licensing Board In the Matter of )
)
ENTERGY NUCLEAR VERMONT )
YANKEE, LLC and ENTERGY NUCLEAR)
OPERATIONS, INC. ) Docket No. 50-271-LR
)
)
(Vermont Yankee Nuclear Power Station) ) ASLBP No. 06-849-03-LR NOTICE OF APPEARANCE Derron J. Blakely, being an attorney at law in good standing admitted to practice before the courts of the District of Columbia, as well as various federal courts, hereby enters his appearance as counsel on behalf of Electric Power Research Institute in any proceeding related to the above-captioned matter.
Respectfully submitted, COVINGTON ý&BUIR-L-M LLP 1201 Pennsylvania Avenue, N.W.
Washington, DC 20004-2401 Telephone: (202) 662-5418 Facsimile: (202) 778-5418 e-mail: dblakely@cov.com