ML22042A678
| ML22042A678 | |
| Person / Time | |
|---|---|
| Site: | Calvert Cliffs, Nine Mile Point, Ginna, FitzPatrick, 07200078  |
| Issue date: | 02/11/2022 |
| From: | David Helker Constellation Energy Generation |
| To: | Document Control Desk, Office of Nuclear Material Safety and Safeguards, Office of Nuclear Reactor Regulation |
| References | |
| Download: ML22042A678 (93) | |
Text
200 Exelon Way Kennett Square, PA 19348 www.ConstellationEnergy.com February 11, 2022 U.S. Nuclear Regulatory Commission ATTN: Document Control Desk Washington, DC 20555 Calvert Cliffs Nuclear Power Plant, Units 1 and 2 Renewed Facility Operating License Nos. DPR-53 and DPR-69 NRC Docket Nos. 50-317 and 50-318 Calvert Cliffs Independent Spent Fuel Storage Installation Materials License No. SNM-2505 NRC Docket No. 72-08 and 72-78 James A. FitzPatrick Nuclear Power Plant Renewed Facility Operating License No. DPR-59 NRC Docket Nos. 50-333 and 72-12 Nine Mile Point Nuclear Station, Units 1 and 2 Renewed Facility Operating License Nos. DPR-63 and NPF-69 NRC Docket Nos. 50-220 and 50-410 R. E. Ginna Nuclear Power Plant Renewed Facility Operating License No. DPR-18 NRC Docket No. 50-244
Subject:
Submittal of Nuclear Operating Services Agreements and Support Agreements Following License Transfers to Constellation Energy Generation, LLC
References:
- 1) Letter from Blake A. Purnell, U.S. Nuclear Regulatory Commission, to David P. Rhoades, Exelon Generation Company, LLC - "Order Approving Transfer of Licenses and Draft Conforming License Amendments (EPID L-2021-LLM-0000)," dated November 16, 2021 (ML21277A248)
- 2) Letter from Blake A. Purnell, U.S. Nuclear Regulatory Commission to David P. Rhoades, Constellation Energy Generation, LLC - Issuance of Amendments Related to Order Approving Transfer of Licenses, dated February 1, 2022 (ML22021B659)
Constellation Energy Generation, LLC (CEG) is submitting Nuclear Operating Services Agreements (NOSAs) and Support Agreements between CEG and Calvert Cliffs Nuclear Power Plant, LLC, Constellation FitzPatrick, LLC, Nine Mile Point Nuclear Station, LLC, and R. E. Ginna Nuclear Power Plant, LLC following the indirect license transfer of operating authority as specified in the referenced letters for the Order and supporting conforming license amendments. The indirect license transfer occurred on February 1, 2022.
U.S. Nuclear Regulatory Commission Submittal of Nuclear Operating Services Agreements and Support Agreements February 11, 2022 Page 2 The referenced letters for the Order and supporting conforming license amendments established conditions concerning the replacement and submittal of NOSAs within 14 days, and the submittal of Support Agreements within 30 days, following closure of the transaction for the facilities noted.
An example of a condition for providing the NOSAs within 14 days following closure of the transaction is described below.
Within 14 days of the closing of the transaction approved on November 16, 2021, Constellation Energy Generation, LLC shall submit to the NRC the Nuclear Operating Services Agreement reflecting the terms set forth in the application dated February 25, 2021. Section 7.1 of the Nuclear Operating Services Agreement may not be modified in any material respect related to financial arrangements that would adversely impact the ability of the licensee to fund safety-related activities authorized by the license without the prior written consent of the Director of the Office of Nuclear Reactor Regulation.
In addition, an example of a condition for providing the Support Agreements within 30 days following closure of the transaction is described below.
Constellation Energy Generation, LLC shall, no later than the date the closing of the transaction approved on November 16, 2021, occurs, enter into a Support Agreement of approximately $126 million with CCNPP, LLC. Calvert Cliffs Nuclear Power Plant, LLC shall not take any action to cause Constellation Energy Generation, LLC, or its successors and assigns, to void, cancel, or materially modify the Constellation Energy Generation, LLC Support Agreement or cause it to fail to perform, or impair its performance under the Constellation Energy Generation, LLC Support Agreement, without the prior written consent of the NRC.
The Constellation Energy Generation, LLC Support Agreement may not be amended or modified without 30 days prior written notice to the Director of the Office of Nuclear Reactor Regulation or their designee. An executed copy of the Constellation Energy Generation, LLC Support Agreement shall be submitted to the NRC no later than 30 days after the completion of the proposed transaction.
Constellation Energy Generation, LLC shall inform the NRC in writing no later than 14 days after any funds are provided to or for CCNPP, LLC under the Constellation Energy Generation, LLC Support Agreement.
Accordingly, the NOSAs and Support Agreements between CEG and Calvert Cliffs Nuclear Power Plant, LLC, Constellation FitzPatrick, LLC, Nine Mile Point Nuclear Station, LLC, and R. E. Ginna Nuclear Power Plant, LLC reflecting the terms set forth in the application dated February 25, 2021, are being submitted within the timeframe specified in the license transfer as required by the referenced letters. Attachments 1 - 8 of this letter contain the respective NOSAs and Support Agreements for the facilities.
There are no regulatory commitments contained in this submittal.
U.S. Nuclear Regulatory Commission Submittal of Nuclear Operating Services Agreements and Support Agreements February 11, 2022 Page 3 If you have any questions, please contact David P. Helker at 610-765-5525.
Respectfully, David P. Helker Sr. Manager, Licensing Constellation Energy Generation, LLC Attachments:
- 1. Constellation Energy Generation, LLC Nuclear Operating Services Agreement with Calvert Cliffs Nuclear Power Plant, LLC
- 2. Constellation Energy Generation, LLC Nuclear Operating Services Agreement with Constellation FitzPatrick, LLC
- 3. Constellation Energy Generation, LLC Nuclear Operating Services Agreement with Nine Mile Point Nuclear Station, LLC
- 4. Constellation Energy Generation, LLC Nuclear Operating Services Agreement with R. E. Ginna Nuclear Power Plant, LLC
- 5. Constellation Energy Generation, LLC Support Agreement with Calvert Cliffs Nuclear Power Plant, LLC
U.S. Nuclear Regulatory Commission Submittal of Nuclear Operating Services Agreements and Support Agreements February 11, 2022 Page 4 cc: (w/ Attachments)
Regional Administrator - NRC Region I Director, Office of Nuclear Reactor Regulation Director, Office of Nuclear Material Safety and Safeguards NRC Senior Resident Inspector - Calvert Cliffs Nuclear Power Plant NRC Senior Resident Inspector - James A. FitzPatrick Nuclear Power Plant NRC Senior Resident Inspector - Nine Mile Point Nuclear Station NRC Senior Resident Inspector - R. E. Ginna Nuclear Power Plant NRC Project Manager, NRR - Constellation Generation Fleet S. Seaman - State of Maryland A. L. Peterson, NYSERDA B. Frymire, NYSPSC
Constellation Energy Generation, LLC Nuclear Operating Services Agreement with Calvert Cliffs Nuclear Power Plant, LLC
EXECUTION VERSION NUCLEAR OPERATING SERVICES AGREEMENT FOR CALVERT CLIFFS NUCLEAR POWER PLANT, LLC This Nuclear Operating Services Agreement (this Agreement or NOSA) dated as of February 1, 2022 (the Commencement Date) is entered into by and among Constellation Energy Generation, LLC, a Pennsylvania limited liability company (Operator), and Calvert Cliffs Nuclear Power Plant, LLC, a Maryland limited liability company (Owner). Operator and Owner are referred to individually herein as a Party and collectively herein as the Parties.
RECITALS WHEREAS, Owner desires to continue engaging the services of a qualified operator to provide corporate, operational and managerial support services and other services for the Facility; WHEREAS, Operator has the requisite experience and expertise in providing corporate, operational and managerial support services and possesses the resources and capabilities to continue providing such services for the Facility under Owners ownership and to operate the Facility as part of Operators Fleet of nuclear power plants; and WHEREAS, Owner desires to continue engaging Operator to perform the Services (as defined herein) and Operator desires to continue performing such Services as provided herein; NOW THEREFORE, in consideration for the premises and the representations, warranties, and covenants contained herein, and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
ARTICLE I DEFINITIONS 1.1 Definitions. As used in this Agreement, the following terms shall have the meanings indicated:
Act means the Atomic Energy Act of 1954, as amended.
Affiliate means, with respect to any Person, any other Person directly or indirectly Controlled by, Controlling or under common Control with such Person.
Agreement has the meaning set forth in the preamble.
Allocated Costs means the costs incurred by Operator associated with providing the Services (other than Direct Costs) allocated to each nuclear facility in Operators Fleet in accordance with Section 7.1(b).
Applicable Law means any federal, state or local statute, law, rule, regulation, code, ordinance, judgment, decree or writ of any Governmental Authority, and any official interpretations thereof,
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 2 regulating, relating to or imposing liability or standards of conduct concerning Owner, Operator, the Site, the Facility or the performance of the Services.
Commencement Date has the meaning set forth in the Preamble.
Control means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of securities, by contract or otherwise. The terms Controlled and Controlling shall have correlative meanings.
Decommission and Decommissioning mean (1) the complete retirement and removal of the Facility from service and the restoration of the Site to a status that permits the Site and spent fuel storage installation to be released for unrestricted use in accordance with the NRC regulations, as well as any planning and administrative activities incidental thereto, including (a) reducing residual radioactivity at the Site and spent fuel storage installation to levels meeting the NRC radiological release criteria and any other actions necessary to obtain termination of the NRC License and (b) all other activities necessary for the retirement, dismantlement, and decontamination of the Facility to comply with all applicable requirements of the Act, the NRC rules, regulations, orders and pronouncements thereunder and any related decommissioning plan, environmental laws and other laws; and (2) any other environmental remediation and Site restoration of or relating to the Site or the Facilities as required by Applicable Law or applicable agreements.
Direct Cost has the meaning set forth in Section 7.1(a).
Facility has the meaning set forth in the Whereas clauses hereof.
Good Utility Practice means at any time those practices, methods, techniques and standards in effect at the time of performance of the Services hereunder that are commonly used in the United States in prudent management and maintenance of equipment of, and the provision of operational support services for, nuclear generating stations. Without limiting the foregoing, Good Utility Practice is also intended to be the practices, methods, techniques and standards utilized by Operator in operational and managerial support services for its owned, affiliated, managed or operated nuclear generating facilities located in the United States, and as generally accepted in the industry with respect to the management and maintenance of, and the provision of services for, nuclear generating stations located in the United States and the exercise of that degree of skill, diligence, prudence and foresight which would reasonably and ordinarily be expected at such time from a skilled and experienced provider of services similar to the Services.
Governmental Approval means any authorization, consent, approval, license, ruling, waiver, permit, certification, exemption, filing, declaration or registration by or with any Governmental Authority having jurisdiction over any of the Site, the Facility, the Services or the Parties.
Governmental Authority means all federal, state and local governments and all agencies, authorities, departments, instrumentalities, courts, or other subdivisions of each having executive, legislative, judicial, regulatory or administrative jurisdiction over any of the Site, the Facility, the Services or the Parties.
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 3 INPO Allocation Method means the method for allocating costs incurred by Operator in respect of Operators Fleet to each nuclear facility in Operators Fleet in the same manner as the Institute of Nuclear Power Operations allocates its fees, whereby the Site with an operating reactor is allocated three (3) points and each operating reactor in Operators Fleet is allocated one (1) point (e.g., four (4) points for single units, five (5) points for dual units). For each billing period, the Allocated Costs charged to the Facility will be equal to (a) the aggregate amount of Allocated Costs incurred by Operator during such billing period; multiplied by (b) a fraction, the numerator of which is the INPO points attributed to the Facility, and the denominator of which is the total number of INPO points attributed to all facilities in Operators Fleet.
IP means any information and any other intellectual property of any type whatsoever, in any tangible or intangible form or medium, and all rights associated therewith in any jurisdiction, including any proprietary management processes of Operator and its Affiliates, and the Operators Nuclear Management Model.
NRC means the United States Nuclear Regulatory Commission and any successor agency established in the United States for the regulation of civilian nuclear power.
NRC Licenses means the licenses for the Facility issued to Owner and Operator pursuant to the regulations of the NRC.
Operator Personnel means the personnel from Operators or any of its Affiliates or Subcontractors organizations, agents, counsel, and advisors performing Services under this Agreement.
Operators Fleet means the Facility taken together with each other nuclear facility for which Operator is the NRC licensed operator under contract or by ownership.
Operators Nuclear Management Model means Operators proprietary nuclear management model and related management systems, including software programs, policies, processes and procedures relative to the management, operation and maintenance of Operators nuclear generating facilities, as updated by Operator from time to time.
Owners Contracts means any other contracts to which Owner is a party for (1) procuring engineering or materials, tools, supplies, or equipment necessary for capital expenditures or repairs of the Facility, (2) construction of any capital expenditures with respect to the Facility, (3) the repair of the Facility, (4) the purchasing or leasing of equipment with respect to the Facility, (5) utilities necessary for the operation of the Facility, or (6) any other material services; provided that Owner Contracts do not include this Agreement, the Subcontracts, or any of Owners commercial agreements not directly related to operations (such as financing and power purchase agreements).
Party or Parties has the meaning set forth in the preamble.
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 4 Person means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or any federal, state, local or other governmental entity, body or authority.
Records has the meaning set forth in Article XI.
Reimbursable Costs has the meaning set forth in Section 7.2.
Services has the meaning set forth in Section 3.1.
Site means the real property on which the Facility is located including surrounding land owned by the Owner or its Affiliates.
Subcontract means any agreement by Operator with a Subcontractor for the performance of any portion of the Services.
Subcontractor means any vendor, supplier, manufacturer, material man, Operator or subcontractor (other than Operator or its Affiliates) that is contracted directly with Operator to perform any part of the Services or providing other services or supplies in connection with the Services.
Taxes means all fees, taxes (including sales taxes, use taxes, stamp taxes, value-added taxes, ad valorem taxes and property taxes (personal and real, tangible and intangible)), levies, assessments, customs duties, withholdings and other charges and impositions of any nature, other than taxes based on net income or net worth, plus all related interest, penalties, fines and additions to tax, now or hereafter imposed by any Governmental Authority or other taxing authority.
Term has the meaning set forth in Section 2.1.
Termination Date has the meaning set forth in Section 10.2(a).
Transition Period has the meaning set forth in Section 10.3.
ARTICLE II TERM; COMMENCEMENT OF SERVICES 2.1 Term. The term of this Agreement (the Term) shall begin on the Commencement Date and shall continue through Decommissioning unless terminated earlier as provided herein.
ARTICLE III OPERATOR RESPONSIBILITIES; SCOPE OF RELATIONSHIP 3.1 Services. Subject to the terms of this Agreement, Operator shall (a) provide corporate and administrative services necessary for the operation of the Facility as the NRC licensed operator and to operate its business, in accordance with historic practice, Applicable Law, and contractual obligations, (b) manage, operate, maintain and Decommission the Facility as the
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 5 NRC licensed operator in accordance with the NRC Licenses and Applicable Law, and on behalf of Owner on a basis consistent in all material respects with Good Utility Practices and Operators Nuclear Management Model and (c) be responsible for the management and interim storage of spent nuclear fuel at the Facility in accordance with Applicable Law relating to the use, handling and disposal of radioactive materials, including obligations under the Nuclear Waste Policy Act of 1982 (together, the Services).
3.2 Contract Management Services. Without limit the foregoing, Operator will assist Owner with the implementation and management of any Owner Contracts. Notwithstanding the foregoing, Owners shall remain solely responsible and liable for the Owner Contracts. Operator may from time to time act as Owners agent on Owners behalf with respect to managing and overseeing the Owner contracts.
3.3 Relationship of the Parties. In performing the Services, Operator shall be an independent contractor of Owner.
3.4 Subcontractors. Operator or its Affiliates may contract a Subcontractor to perform any part or parts of the Services. Notwithstanding the foregoing, Operator shall at all times remain solely responsible for the quality, timeliness and professionalism of all Subcontractors and the performance of the Services. Operator shall be fully responsible for the acts and omissions of its Subcontractors. For the avoidance of doubt, Operator shall remain solely responsible and liable for any Subcontractor contracts to which Operator, and not Owner, is a party.
3.5 Reports. At the request of Owner, Operator shall provide Owner with and submit in accordance with Applicable Law standard operational and financial reports in accordance with its Operators Nuclear Management Model.
3.6 Employees. Services will be performed by employees of Operator or its Affiliates.
Operator may, subject to the terms hereof, elect to transfer employees from employment by Owner to employment by Operator, loan Operator employees to provide Services to Owner, or transfer employees from employment by Operator to employment by Owner (provided that if Operator transfers Operator employees to employment by Owner, Operator will indemnify Owner for liabilities arising solely from such employment, other than Allocated Costs or Direct Costs chargeable under the terms of this Agreement). Operator may elect to assign employees of Owner on a short-term basis to provide services to operations of Operator other than the Facility, so long as such costs are allocated in a manner consistent with the allocation of Direct Costs in this Agreement, for the use of those employees and Operator indemnifies Owner solely for any liability arising from the performance of Owners employees at a location other than the Facility.
ARTICLE IV OWNERS RESPONSIBILITIES 4.1 Ownership and Operation of Facility. On the Commencement Date, Owner will continue to own the Facility and Operator will continue to operate the Facility, provided that Owner and Operator have all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator. After the Commencement Date, Owner
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 6 will ensure that Operator has access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information necessary to comply with Owner quality assurance plan, and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
4.2 Liabilities. Owner shall be responsible for the performance or discharge of any liabilities relating to the Facility arising prior to the Commencement Date, except for those liabilities for which Operator is expressly liable under the terms of this Agreement. From and after the Commencement Date, each Party shall be responsible for the performance or discharge of their respective liabilities relating to the Facility.
4.3 Cooperation. As necessary, Owner shall furnish to Operator the information or assistance as may be required for Operator to comply with the terms of this Agreement and for the expeditious and orderly performance of the Services by Operator.
4.4 Access to the Facility and the Site. Subject to applicable security and access rules and regulations, Owner shall provide Operator access to the Facility and Site as required for performance of the Services and copies of all licenses, easements or other agreements Owner has entered or may enter into regarding access to the Facility and the Site that affect Operator or the Services. Owner shall ensure that Operator has the full and uninterrupted benefit of all such licenses, easements or other agreements and shall ensure that such licenses, easements or other agreements do not adversely affect Operators performance of the Services.
4.5 Owner Information. Owner shall act in good faith to assure that all information and materials given by Owner to Operator are accurate when given in all material respects.
4.6 Appointment as Agent. Owner does hereby grant to Operator and its Affiliates, as agent for Owner, individually or collectively, the power and authority to exercise in accordance with Applicable Laws the rights of Owner under, and to execute, modify, amend or terminate, any contracts, including without limitation, leases easements, agreements, purchase orders, licenses, permits and privileges relating to the operation and maintenance of, and making capital improvements to, the Facility. Nonetheless, unless otherwise agreed in writing, Owner shall remain solely responsible for each of the contracts to which Owner, and not Operator, is a party.
ARTICLE V OPERATORS RESPONSIBILITIES 5.1 Continued Operation of Facility On the Commencement Date, Operator shall continue to be responsible for day-to-day management activities and operation of the Facility, provided that Owner and Operator have (i) all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator and (ii) all equipment, materials, spare parts and consumables necessary for Operator to provide the Services. After the Commencement Date, Operator shall retain access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 7 necessary to comply with Owners quality assurance plan and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
5.2 Governmental Approvals. Operator shall support and assist Owner as may be reasonably required in order for Owner to obtain and maintain all Governmental Approvals (a) required by Applicable Law for Owner to own and Operator to operate the Facility and (b) required by Applicable Law for Operator to perform the Services, including, without limitation, the NRC Licenses and those related to nuclear safety.
5.3 NRC Licenses. Operator will hold and maintain the NRC Licenses required to operate the Facility for the duration of the Term.
5.4 Assistance to Owner. Operator shall furnish to Owner the information or assistance as may be reasonably necessary in order to enable Owner to comply with its obligations under Article IV and for the expeditious and orderly operation of the Facility.
5.5 Performance Standards. Operator shall perform the Services: (a) in compliance with the terms of this Agreement; (b) in compliance with the standards and objectives of Operators Nuclear Management Model as adapted to the Facility, as the same may change from time to time; and (c) in a good and workmanlike manner in accordance with the NRC Licenses and Applicable Law, and consistent with Good Utility Practice.
5.6 Taxes and Benefits. During the Term of this Agreement, Operator shall be solely responsible for providing or causing to be provided to each member of Operator Personnel his or her compensation and benefits, and shall further be solely responsible to issue or cause to issue IRS W-2 forms for Operator Personnel and for all taxes, workers compensation, social security, unemployment, and other contributions for benefits measured by salary payable to Operator Personnel.
5.7 Operator Employees. Except as provided in Section 7.1, Operator shall be solely responsible for (a) all compensation, benefits and other employer obligations in respect of employees of Operator or its Affiliates providing Services under this Agreement, (b) training and oversight of employees of Operator or its Affiliates providing Services under this Agreement and (c) all employment decisions with respect to employees of Operator or its Affiliates providing Services under this Agreement.
ARTICLE VI BUDGET 6.1 Annual Budget. Operator shall prepare and propose an annual budget and a business plan.
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 8 ARTICLE VII COST REIMBURSEMENT 7.1 Cost Reimbursement. From and after the Commencement Date and continuing throughout the Term, Operator shall be entitled to be reimbursed for the following costs incurred by Operator, its Subcontractors, or its Affiliates in performance of the Services:
(a)
Direct Costs. All direct costs of Operator of providing any Service that would not constitute Allocated Costs pursuant to Section 7.1(b), including without limitation: (i) the costs of Operator Personnel performing the Services at the Facility, including travel and relocation expenses where applicable; (ii) any costs incurred by Operator associated with improvements to existing systems, integration into Operator systems, and software programs required to implement Operators Nuclear Management Model and CFAM (Corporate Functional Area Manager) philosophy at each Facility; and (iii) all costs incurred by Operator (including the cost of any Subcontractors) related to materials, services, equipment, Taxes (other than those imposed in respect of income or revenues of Operator) and other expenditures (as an agent of the Owner) that are required in the good faith judgment of Operator to operate the Facility in accordance with Good Utility Practice, in each case as described in Exhibit A (such costs collectively, the Direct Costs). The Direct Costs will be allocated on a basis consistent with Operators similar costs as allocated to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time).
(b)
Allocated Costs. All Allocated Costs based on the INPO Allocation Method, calculated based on the Facility being part of Operators Fleet as described in Exhibit A; provided that such allocation is non-discriminatory and on a basis consistent with Operators allocation of similar costs as invoiced to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time). For avoidance of doubt, certain personnel-related reimbursements may be classified as Allocated Costs, including the travel and relocation expenses of certain personnel. For the avoidance of doubt, in no event shall Allocated Costs include any item to the extent such item is also invoiced as a Direct Cost.
7.2 Tracking Costs. Operator shall track all Direct Costs and Allocated Costs (together the Reimbursable Costs) incurred by Operator in operating the Facility.
Notwithstanding any other provision in this Agreement, all costs associated with Decommissioning the Facility are the responsibility of Owner and, to the extent such costs are allowed by Applicable Law to be reimbursed from any Decommissioning trust funds maintained for the Facility, shall be paid for from such funds.
ARTICLE VIII TAXES 8.1 Taxes. Each Party shall be responsible for all Taxes to which it is subject, which Taxes arise out of or are in any way connected with this Agreement. If, under Applicable Law, Operator is required to collect any such Taxes from Owner, Operator shall settle the collection of such Taxes by intercompany accounting.
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 9 ARTICLE IX INSURANCE 9.1 Operator Insurance. Operator shall procure and maintain insurance coverage during the Term in the type and amount consistent with insurance covering Operators Fleet and in accordance with Good Utility Practice.
ARTICLE X TERMINATION 10.1 Termination. During the Term, this Agreement may be terminated by Owner, at its discretion, provided that Owner obtains all required Governmental Approvals required to transfer operation of the Facility to Owner or another Person selected by Owner. Operator shall continue to perform all Services contemplated by this Agreement until Owner has secured all such required Governmental Approvals, including approval from the NRC.
10.2 Actions upon Termination. Prior to the effective date of any termination under this Article X, the Parties shall work in good faith to ensure a satisfactory transfer of responsibility in process and cooperate to obtain all Governmental Approvals (if any and to the extent allowed) required for such transfer. Upon a termination in accordance with Section 10.1, Operator shall:
(a) discontinue performance of the Services on the date agreed upon by the parties (the Termination Date),
(b) place no further orders or enter into any Subcontracts for items or Services unless required for standby, demobilization, remobilization or as otherwise provided in this Article 10; (c) subject to the terms of this Agreement, cooperate with Owner in the transfer to Owner of items or information and disposition of the Services in progress; (d) inventory and turn over to Owner all equipment and materials purchased by Operator and reimbursed by Owner in accordance with the terms of this Agreement and any other equipment or other items provided by Owner for performance of the terminated or suspended Services; (e) cooperate with Owner and their agents and representatives in the turnover of the Services and transition of the employees, as appropriate, to Owner (or their designated successor Operator in the event of termination) who shall provide operational support services for the Facility; and (f) up to and including the Termination Date, Operator shall continue to perform the Services hereunder in accordance with Good Utility Practices and in accordance with the terms of this Agreement; provided that Operator shall be entitled to and shall collect all compensation in accordance with this Agreement (including Reimbursable Costs payable under the terms of this Agreement and any additional reasonable out-of-pocket costs incurred in
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 10 providing transition assistance to Owner or their successor Operator during such time) through intercompany accounting.
10.3 Post-Termination Transition Period. Owners right to use the IP will automatically cease at the Termination Date; provided that Owner will be entitled to continue to use the IP on a transitional period for a period of 12 months following the Termination Date (such period, the Transition Period) to the extent necessary to provide an orderly transition off of Operators systems and software platforms. During the Transition Period, Operator shall cooperate and provide reasonable assistance to Owner in effecting such IP transition; provided that Owner reimburses Operator for Operators actual cost of providing such transition services and permitting continued use of IP, determined in the same manner that costs are allocated and charged pursuant to Article VII of this Agreement.
ARTICLE XI RECORDS In accordance with its standard corporate practices, Operator will at all times operate a system of accounting and maintain complete and accurate records and supporting documentation in relation to the performance of its obligations under this Agreement, provided that documentation related to the provision and performance of the Services shall be maintained for the greater of five years or as required by Applicable Law. Operator shall collaborate with and assist Owner to operate a system of accounting and maintain complete and accurate records in relation to the operation of the Facility, including Services rendered by Operator (the Records). The intent is for the Records to be in accordance with Good Utility Practice to ensure that the Records will be at least sufficient to enable Owner and/or their authorized representatives to conduct thorough operational, technical, and regulatory audits related to the Facility. The Records will be maintained for the greater of (a) Operators document retention program requirements or (b) as is required by Applicable Laws.
ARTICLE XII MISCELLANEOUS 12.1 Notices. Any notice pertaining to this Agreement shall be in writing and sent via facsimile transmittal, registered or certified mail (postage prepaid), hand delivery or by commercial overnight courier, to the other Party, at its respective address designated in this Agreement as set forth below. Each Party shall have the right to change the contact information set forth herein by sending a similar notice to the other Party in like manner. Notices, demands, offers or other written instruments shall be deemed to have been duly given on the date actually received by the intended recipient.
If to Operator:
Constellation Energy Generation, LLC 4300 Winfield Road Warrenville, Illinois 60555 Attn: Chief Nuclear Officer
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 11 Fax: 630-657-4323 If to Owner:
Calvert Cliffs Nuclear Power Plant, LLC 1650 Calvert Cliffs Parkway Lusby, Maryland 20657 Attn: Site Vice President Fax: 410-495-3500 12.2 Complete Agreement. This Agreement sets forth the entire understanding of the Parties and supersedes any and all prior agreements, arrangements, or understandings relating to the subject matter hereof.
12.3 Construction of Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement.
12.4 Amendments. The terms of this Agreement shall be modified only by a written document signed by an authorized representative of each Party, which authorizes a change in this Agreement. No purported oral modification, waiver, or rescission of this Agreement by an employee or agent of any Party shall operate as a modification, waiver, or rescission of any of the provisions of this Agreement. No course of prior dealing, usage of trade, and course of performance shall be used to modify, supplement, or explain any terms of this Agreement. In addition, to the extent required by the NRC Facility license, written consent from the NRC may also be required.
12.5 No Third Party Beneficiaries. A person who is not a Party to this Agreement may not enforce any of its terms and the provisions of this Agreement are intended for the sole benefit of Owner and Operator and there are no third party beneficiaries hereof, other than their permitted successors and assigns pursuant to the relevant provisions hereof.
12.6 Governing Law; Interpretation; Severability. This Agreement shall be interpreted, governed and construed in accordance with the laws of the Commonwealth of Pennsylvania, and excluding any conflict of laws rule or principle that might refer the governance or the construction of this Agreement to the law of another jurisdiction. The provisions of this Agreement shall be interpreted where possible in a manner to sustain their legality and enforceability. The unenforceability of any provision of this Agreement in a specific situation shall not affect the enforceability of that provision in another situation or the remaining provisions of this Agreement. Subject to the terms of this Agreement, the Parties shall have all rights and remedies at law or in equity.
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 12 12.7 Assignment. No Party may assign its right, title, and interest in this Agreement to any other Person without the prior written consent of the other Party.
12.8 Execution; Counterparts. This Agreement shall not be binding or effective until properly executed by each Party. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which shall constitute one and the same Agreement, and it shall not be necessary in making proof of this Agreement to produce or account for more than one such fully executed counterpart.
12.9 Survival. The following Articles and Sections shall survive termination of this Agreement: Articles VIII and IX in addition to any other provisions which by their nature should, or by their express terms do, survive or extend beyond the Term of this Agreement.
12.10 Waiver. Either Partys waiver of any breach or failure to enforce any of the terms, covenants, conditions, or other provisions of this Agreement at any time shall not in any way affect, limit, modify, or waive that Partys right thereafter to enforce or compel strict compliance with every term, covenant, condition, or other provision hereof, any course of dealing or custom of the trade notwithstanding. All waivers of any term, covenant, condition or other provision of this Agreement must be given in writing.
Nuclear Operating Services Agreement Calvert Cliffs Nuclear Power Plant, LLC OPERATOR: Constellation Energy Generation, LLC By:
Name: Bryan Hanson
Title:
Executive Vice President & Chief Generation Officer OWNER: Calvert Cliffs Nuclear Power Plant, LLC By:
Name: Bryan Hanson
Title:
Senior Vice President
Nuclear Operating Services Agreement - Exhibit A Calvert Cliffs Nuclear Power Plant, LLC Page 1 EXHIBIT A Characterization of Costs For avoidance of doubt, the Services may include, but will not be limited to, those described under the subheadings below:
The following corporate nuclear support functions at Operators Nuclear Division will be allocated costs through the INPO formula as Nuclear Corporate Services Chief Nuclear Officer and staff Nuclear oversight Nuclear human resources o Talent development o Recruiting Labor relations Engineering and technical services governance and oversight o Programs and design engineering o Nuclear fuel procurement o Project management o Asset management Operational support services governance and oversight o Operations oversight and nuclear duty office o Maintenance and work management o Radiation protection, chemistry and environmental o Industrial safety o Training Outage services o Reactor and turbine maintenance o Inspection services o Vendor alliance management o Outage planning and scheduling Decommissioning and spent fuel management Security Emergency preparedness Nuclear finance and accounting o Financial reports o Business planning Licensing and regulatory o Common regulatory and industry fees o Government affairs Payroll and associated employee costs and benefits of allocated employees
Nuclear Operating Services Agreement - Exhibit A Calvert Cliffs Nuclear Power Plant, LLC Page 2 Travel and living for business expenses of allocated employees Facility rent and utilities The following nuclear support functions will be performed at the Site and be direct costs Payroll and associated site employee costs and benefits Travel and living for business expenses of site employees Materials, parts, equipment and chemicals Service contracts performed at the site Waste disposal Outage services Facility cost The following Nuclear Services will not be performed at the Site and will be direct costs Corporate managed site specific projects (e.g. license amendments, large equipment replacements)
Nuclear fuel design and analysis Financial support for financial reports and reporting Roving outage services support The following administrative functions will be allocated costs through the INPO formula as Nuclear Corporate Services Strategic supply and procurement IT support and development for fleet wide systems and equipment Payroll and accounts payable processing General legal support Benefits administration The following administrative functions will be performed at the Site and will be direct costs IT staff and equipment Supply procurement and materials management functions Communications staff Human resources The following administrative functions will not be performed at the Site and will be direct costs Legal support on specific matters relating to a site Property tax negotiation Labor negotiations
Nuclear Operating Services Agreement - Exhibit A Calvert Cliffs Nuclear Power Plant, LLC Page 3 Corporate managed site-specific projects
Constellation Energy Generation, LLC Nuclear Operating Services Agreement with Constellation FitzPatrick, LLC
EXECUTION VERSION NUCLEAR OPERATING SERVICES AGREEMENT FOR CONSTELLATION FITZPATRICK, LLC This Nuclear Operating Services Agreement (this Agreement or NOSA) dated as of February 1, 2022 (the Commencement Date) is entered into by and among Constellation Energy Generation, LLC, a Pennsylvania limited liability company (Operator), and Constellation FitzPatrick, LLC, a Delaware limited liability company (Owner). Operator and Owner are referred to individually herein as a Party and collectively herein as the Parties.
RECITALS WHEREAS, Owner desires to continue engaging the services of a qualified operator to provide corporate, operational and managerial support services and other services for the Facility; WHEREAS, Operator has the requisite experience and expertise in providing corporate, operational and managerial support services and possesses the resources and capabilities to continue providing such services for the Facility under Owners ownership and to operate the Facility as part of Operators Fleet of nuclear power plants; and WHEREAS, Owner desires to continue engaging Operator to perform the Services (as defined herein) and Operator desires to continue performing such Services as provided herein; NOW THEREFORE, in consideration for the premises and the representations, warranties, and covenants contained herein, and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
ARTICLE I DEFINITIONS 1.1 Definitions. As used in this Agreement, the following terms shall have the meanings indicated:
Act means the Atomic Energy Act of 1954, as amended.
Affiliate means, with respect to any Person, any other Person directly or indirectly Controlled by, Controlling or under common Control with such Person.
Agreement has the meaning set forth in the preamble.
Allocated Costs means the costs incurred by Operator associated with providing the Services (other than Direct Costs) allocated to each nuclear facility in Operators Fleet in accordance with Section 7.1(b).
Applicable Law means any federal, state or local statute, law, rule, regulation, code, ordinance, judgment, decree or writ of any Governmental Authority, and any official interpretations thereof,
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 2 regulating, relating to or imposing liability or standards of conduct concerning Owner, Operator, the Site, the Facility or the performance of the Services.
Commencement Date has the meaning set forth in the Preamble.
Control means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of securities, by contract or otherwise. The terms Controlled and Controlling shall have correlative meanings.
Decommission and Decommissioning mean (1) the complete retirement and removal of the Facility from service and the restoration of the Site to a status that permits the Site and spent fuel storage installation to be released for unrestricted use in accordance with the NRC regulations, as well as any planning and administrative activities incidental thereto, including (a) reducing residual radioactivity at the Site and spent fuel storage installation to levels meeting the NRC radiological release criteria and any other actions necessary to obtain termination of the NRC License and (b) all other activities necessary for the retirement, dismantlement, and decontamination of the Facility to comply with all applicable requirements of the Act, the NRC rules, regulations, orders and pronouncements thereunder and any related decommissioning plan, environmental laws and other laws; and (2) any other environmental remediation and Site restoration of or relating to the Site or the Facilities as required by Applicable Law or applicable agreements.
Direct Cost has the meaning set forth in Section 7.1(a).
Facility has the meaning set forth in the Whereas clauses hereof.
Good Utility Practice means at any time those practices, methods, techniques and standards in effect at the time of performance of the Services hereunder that are commonly used in the United States in prudent management and maintenance of equipment of, and the provision of operational support services for, nuclear generating stations. Without limiting the foregoing, Good Utility Practice is also intended to be the practices, methods, techniques and standards utilized by Operator in operational and managerial support services for its owned, affiliated, managed or operated nuclear generating facilities located in the United States, and as generally accepted in the industry with respect to the management and maintenance of, and the provision of services for, nuclear generating stations located in the United States and the exercise of that degree of skill, diligence, prudence and foresight which would reasonably and ordinarily be expected at such time from a skilled and experienced provider of services similar to the Services.
Governmental Approval means any authorization, consent, approval, license, ruling, waiver, permit, certification, exemption, filing, declaration or registration by or with any Governmental Authority having jurisdiction over any of the Site, the Facility, the Services or the Parties.
Governmental Authority means all federal, state and local governments and all agencies, authorities, departments, instrumentalities, courts, or other subdivisions of each having executive, legislative, judicial, regulatory or administrative jurisdiction over any of the Site, the Facility, the Services or the Parties.
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 3 INPO Allocation Method means the method for allocating costs incurred by Operator in respect of Operators Fleet to each nuclear facility in Operators Fleet in the same manner as the Institute of Nuclear Power Operations allocates its fees, whereby the Site with an operating reactor is allocated three (3) points and each operating reactor in Operators Fleet is allocated one (1) point (e.g., four (4) points for single units, five (5) points for dual units). For each billing period, the Allocated Costs charged to the Facility will be equal to (a) the aggregate amount of Allocated Costs incurred by Operator during such billing period; multiplied by (b) a fraction, the numerator of which is the INPO points attributed to the Facility, and the denominator of which is the total number of INPO points attributed to all facilities in Operators Fleet.
IP means any information and any other intellectual property of any type whatsoever, in any tangible or intangible form or medium, and all rights associated therewith in any jurisdiction, including any proprietary management processes of Operator and its Affiliates, and the Operators Nuclear Management Model.
NRC means the United States Nuclear Regulatory Commission and any successor agency established in the United States for the regulation of civilian nuclear power.
NRC Licenses means the licenses for the Facility issued to Owner and Operator pursuant to the regulations of the NRC.
Operator Personnel means the personnel from Operators or any of its Affiliates or Subcontractors organizations, agents, counsel, and advisors performing Services under this Agreement.
Operators Fleet means the Facility taken together with each other nuclear facility for which Operator is the NRC licensed operator under contract or by ownership.
Operators Nuclear Management Model means Operators proprietary nuclear management model and related management systems, including software programs, policies, processes and procedures relative to the management, operation and maintenance of Operators nuclear generating facilities, as updated by Operator from time to time.
Owners Contracts means any other contracts to which Owner is a party for (1) procuring engineering or materials, tools, supplies, or equipment necessary for capital expenditures or repairs of the Facility, (2) construction of any capital expenditures with respect to the Facility, (3) the repair of the Facility, (4) the purchasing or leasing of equipment with respect to the Facility, (5) utilities necessary for the operation of the Facility, or (6) any other material services; provided that Owner Contracts do not include this Agreement, the Subcontracts, or any of Owners commercial agreements not directly related to operations (such as financing and power purchase agreements).
Party or Parties has the meaning set forth in the preamble.
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 4 Person means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or any federal, state, local or other governmental entity, body or authority.
Records has the meaning set forth in Article XI.
Reimbursable Costs has the meaning set forth in Section 7.2.
Services has the meaning set forth in Section 3.1.
Site means the real property on which the Facility is located including surrounding land owned by the Owner or its Affiliates.
Subcontract means any agreement by Operator with a Subcontractor for the performance of any portion of the Services.
Subcontractor means any vendor, supplier, manufacturer, material man, Operator or subcontractor (other than Operator or its Affiliates) that is contracted directly with Operator to perform any part of the Services or providing other services or supplies in connection with the Services.
Taxes means all fees, taxes (including sales taxes, use taxes, stamp taxes, value-added taxes, ad valorem taxes and property taxes (personal and real, tangible and intangible)), levies, assessments, customs duties, withholdings and other charges and impositions of any nature, other than taxes based on net income or net worth, plus all related interest, penalties, fines and additions to tax, now or hereafter imposed by any Governmental Authority or other taxing authority.
Term has the meaning set forth in Section 2.1.
Termination Date has the meaning set forth in Section 10.2(a).
Transition Period has the meaning set forth in Section 10.3.
ARTICLE II TERM; COMMENCEMENT OF SERVICES 2.1 Term. The term of this Agreement (the Term) shall begin on the Commencement Date and shall continue through Decommissioning unless terminated earlier as provided herein.
ARTICLE III OPERATOR RESPONSIBILITIES; SCOPE OF RELATIONSHIP 3.1 Services. Subject to the terms of this Agreement, Operator shall (a) provide corporate and administrative services necessary for the operation of the Facility as the NRC licensed operator and to operate its business, in accordance with historic practice, Applicable Law, and contractual obligations, (b) manage, operate, maintain and Decommission the Facility as the
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 5 NRC licensed operator in accordance with the NRC Licenses and Applicable Law, and on behalf of Owner on a basis consistent in all material respects with Good Utility Practices and Operators Nuclear Management Model and (c) be responsible for the management and interim storage of spent nuclear fuel at the Facility in accordance with Applicable Law relating to the use, handling and disposal of radioactive materials, including obligations under the Nuclear Waste Policy Act of 1982 (together, the Services).
3.2 Contract Management Services. Without limit the foregoing, Operator will assist Owner with the implementation and management of any Owner Contracts. Notwithstanding the foregoing, Owners shall remain solely responsible and liable for the Owner Contracts. Operator may from time to time act as Owners agent on Owners behalf with respect to managing and overseeing the Owner contracts.
3.3 Relationship of the Parties. In performing the Services, Operator shall be an independent contractor of Owner.
3.4 Subcontractors. Operator or its Affiliates may contract a Subcontractor to perform any part or parts of the Services. Notwithstanding the foregoing, Operator shall at all times remain solely responsible for the quality, timeliness and professionalism of all Subcontractors and the performance of the Services. Operator shall be fully responsible for the acts and omissions of its Subcontractors. For the avoidance of doubt, Operator shall remain solely responsible and liable for any Subcontractor contracts to which Operator, and not Owner, is a party.
3.5 Reports. At the request of Owner, Operator shall provide Owner with and submit in accordance with Applicable Law standard operational and financial reports in accordance with its Operators Nuclear Management Model.
3.6 Employees. Services will be performed by employees of Operator or its Affiliates.
Operator may, subject to the terms hereof, elect to transfer employees from employment by Owner to employment by Operator, loan Operator employees to provide Services to Owner, or transfer employees from employment by Operator to employment by Owner (provided that if Operator transfers Operator employees to employment by Owner, Operator will indemnify Owner for liabilities arising solely from such employment, other than Allocated Costs or Direct Costs chargeable under the terms of this Agreement). Operator may elect to assign employees of Owner on a short-term basis to provide services to operations of Operator other than the Facility, so long as such costs are allocated in a manner consistent with the allocation of Direct Costs in this Agreement, for the use of those employees and Operator indemnifies Owner solely for any liability arising from the performance of Owners employees at a location other than the Facility.
ARTICLE IV OWNERS RESPONSIBILITIES 4.1 Ownership and Operation of Facility. On the Commencement Date, Owner will continue to own the Facility and Operator will continue to operate the Facility, provided that Owner and Operator have all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator. After the Commencement Date, Owner
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 6 will ensure that Operator has access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information necessary to comply with Owner quality assurance plan, and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
4.2 Liabilities. Owner shall be responsible for the performance or discharge of any liabilities relating to the Facility arising prior to the Commencement Date, except for those liabilities for which Operator is expressly liable under the terms of this Agreement. From and after the Commencement Date, each Party shall be responsible for the performance or discharge of their respective liabilities relating to the Facility.
4.3 Cooperation. As necessary, Owner shall furnish to Operator the information or assistance as may be required for Operator to comply with the terms of this Agreement and for the expeditious and orderly performance of the Services by Operator.
4.4 Access to the Facility and the Site. Subject to applicable security and access rules and regulations, Owner shall provide Operator access to the Facility and Site as required for performance of the Services and copies of all licenses, easements or other agreements Owner has entered or may enter into regarding access to the Facility and the Site that affect Operator or the Services. Owner shall ensure that Operator has the full and uninterrupted benefit of all such licenses, easements or other agreements and shall ensure that such licenses, easements or other agreements do not adversely affect Operators performance of the Services.
4.5 Owner Information. Owner shall act in good faith to assure that all information and materials given by Owner to Operator are accurate when given in all material respects.
4.6 Appointment as Agent. Owner does hereby grant to Operator and its Affiliates, as agent for Owner, individually or collectively, the power and authority to exercise in accordance with Applicable Laws the rights of Owner under, and to execute, modify, amend or terminate, any contracts, including without limitation, leases easements, agreements, purchase orders, licenses, permits and privileges relating to the operation and maintenance of, and making capital improvements to, the Facility. Nonetheless, unless otherwise agreed in writing, Owner shall remain solely responsible for each of the contracts to which Owner, and not Operator, is a party.
ARTICLE V OPERATORS RESPONSIBILITIES 5.1 Continued Operation of Facility On the Commencement Date, Operator shall continue to be responsible for day-to-day management activities and operation of the Facility, provided that Owner and Operator have (i) all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator and (ii) all equipment, materials, spare parts and consumables necessary for Operator to provide the Services. After the Commencement Date, Operator shall retain access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 7 necessary to comply with Owners quality assurance plan and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
5.2 Governmental Approvals. Operator shall support and assist Owner as may be reasonably required in order for Owner to obtain and maintain all Governmental Approvals (a) required by Applicable Law for Owner to own and Operator to operate the Facility and (b) required by Applicable Law for Operator to perform the Services, including, without limitation, the NRC Licenses and those related to nuclear safety.
5.3 NRC Licenses. Operator will hold and maintain the NRC Licenses required to operate the Facility for the duration of the Term.
5.4 Assistance to Owner. Operator shall furnish to Owner the information or assistance as may be reasonably necessary in order to enable Owner to comply with its obligations under Article IV and for the expeditious and orderly operation of the Facility.
5.5 Performance Standards. Operator shall perform the Services: (a) in compliance with the terms of this Agreement; (b) in compliance with the standards and objectives of Operators Nuclear Management Model as adapted to the Facility, as the same may change from time to time; and (c) in a good and workmanlike manner in accordance with the NRC Licenses and Applicable Law, and consistent with Good Utility Practice.
5.6 Taxes and Benefits. During the Term of this Agreement, Operator shall be solely responsible for providing or causing to be provided to each member of Operator Personnel his or her compensation and benefits, and shall further be solely responsible to issue or cause to issue IRS W-2 forms for Operator Personnel and for all taxes, workers compensation, social security, unemployment, and other contributions for benefits measured by salary payable to Operator Personnel.
5.7 Operator Employees. Except as provided in Section 7.1, Operator shall be solely responsible for (a) all compensation, benefits and other employer obligations in respect of employees of Operator or its Affiliates providing Services under this Agreement, (b) training and oversight of employees of Operator or its Affiliates providing Services under this Agreement and (c) all employment decisions with respect to employees of Operator or its Affiliates providing Services under this Agreement.
ARTICLE VI BUDGET 6.1 Annual Budget. Operator shall prepare and propose an annual budget and a business plan.
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 8 ARTICLE VII COST REIMBURSEMENT 7.1 Cost Reimbursement. From and after the Commencement Date and continuing throughout the Term, Operator shall be entitled to be reimbursed for the following costs incurred by Operator, its Subcontractors, or its Affiliates in performance of the Services:
(a)
Direct Costs. All direct costs of Operator of providing any Service that would not constitute Allocated Costs pursuant to Section 7.1(b), including without limitation: (i) the costs of Operator Personnel performing the Services at the Facility, including travel and relocation expenses where applicable; (ii) any costs incurred by Operator associated with improvements to existing systems, integration into Operator systems, and software programs required to implement Operators Nuclear Management Model and CFAM (Corporate Functional Area Manager) philosophy at each Facility; and (iii) all costs incurred by Operator (including the cost of any Subcontractors) related to materials, services, equipment, Taxes (other than those imposed in respect of income or revenues of Operator) and other expenditures (as an agent of the Owner) that are required in the good faith judgment of Operator to operate the Facility in accordance with Good Utility Practice, in each case as described in Exhibit A (such costs collectively, the Direct Costs). The Direct Costs will be allocated on a basis consistent with Operators similar costs as allocated to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time).
(b)
Allocated Costs. All Allocated Costs based on the INPO Allocation Method, calculated based on the Facility being part of Operators Fleet as described in Exhibit A; provided that such allocation is non-discriminatory and on a basis consistent with Operators allocation of similar costs as invoiced to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time). For avoidance of doubt, certain personnel-related reimbursements may be classified as Allocated Costs, including the travel and relocation expenses of certain personnel. For the avoidance of doubt, in no event shall Allocated Costs include any item to the extent such item is also invoiced as a Direct Cost.
7.2 Tracking Costs. Operator shall track all Direct Costs and Allocated Costs (together the Reimbursable Costs) incurred by Operator in operating the Facility.
Notwithstanding any other provision in this Agreement, all costs associated with Decommissioning the Facility are the responsibility of Owner and, to the extent such costs are allowed by Applicable Law to be reimbursed from any Decommissioning trust funds maintained for the Facility, shall be paid for from such funds.
ARTICLE VIII TAXES 8.1 Taxes. Each Party shall be responsible for all Taxes to which it is subject, which Taxes arise out of or are in any way connected with this Agreement. If, under Applicable Law, Operator is required to collect any such Taxes from Owner, Operator shall settle the collection of such Taxes by intercompany accounting.
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 9 ARTICLE IX INSURANCE 9.1 Operator Insurance. Operator shall procure and maintain insurance coverage during the Term in the type and amount consistent with insurance covering Operators Fleet and in accordance with Good Utility Practice.
ARTICLE X TERMINATION 10.1 Termination. During the Term, this Agreement may be terminated by Owner, at its discretion, provided that Owner obtains all required Governmental Approvals required to transfer operation of the Facility to Owner or another Person selected by Owner. Operator shall continue to perform all Services contemplated by this Agreement until Owner has secured all such required Governmental Approvals, including approval from the NRC.
10.2 Actions upon Termination. Prior to the effective date of any termination under this Article X, the Parties shall work in good faith to ensure a satisfactory transfer of responsibility in process and cooperate to obtain all Governmental Approvals (if any and to the extent allowed) required for such transfer. Upon a termination in accordance with Section 10.1, Operator shall:
(a) discontinue performance of the Services on the date agreed upon by the parties (the Termination Date),
(b) place no further orders or enter into any Subcontracts for items or Services unless required for standby, demobilization, remobilization or as otherwise provided in this Article 10; (c) subject to the terms of this Agreement, cooperate with Owner in the transfer to Owner of items or information and disposition of the Services in progress; (d) inventory and turn over to Owner all equipment and materials purchased by Operator and reimbursed by Owner in accordance with the terms of this Agreement and any other equipment or other items provided by Owner for performance of the terminated or suspended Services; (e) cooperate with Owner and their agents and representatives in the turnover of the Services and transition of the employees, as appropriate, to Owner (or their designated successor Operator in the event of termination) who shall provide operational support services for the Facility; and (f) up to and including the Termination Date, Operator shall continue to perform the Services hereunder in accordance with Good Utility Practices and in accordance with the terms of this Agreement; provided that Operator shall be entitled to and shall collect all compensation in accordance with this Agreement (including Reimbursable Costs payable under the terms of this Agreement and any additional reasonable out-of-pocket costs incurred in
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 10 providing transition assistance to Owner or their successor Operator during such time) through intercompany accounting.
10.3 Post-Termination Transition Period. Owners right to use the IP will automatically cease at the Termination Date; provided that Owner will be entitled to continue to use the IP on a transitional period for a period of 12 months following the Termination Date (such period, the Transition Period) to the extent necessary to provide an orderly transition off of Operators systems and software platforms. During the Transition Period, Operator shall cooperate and provide reasonable assistance to Owner in effecting such IP transition; provided that Owner reimburses Operator for Operators actual cost of providing such transition services and permitting continued use of IP, determined in the same manner that costs are allocated and charged pursuant to Article VII of this Agreement.
ARTICLE XI RECORDS In accordance with its standard corporate practices, Operator will at all times operate a system of accounting and maintain complete and accurate records and supporting documentation in relation to the performance of its obligations under this Agreement, provided that documentation related to the provision and performance of the Services shall be maintained for the greater of five years or as required by Applicable Law. Operator shall collaborate with and assist Owner to operate a system of accounting and maintain complete and accurate records in relation to the operation of the Facility, including Services rendered by Operator (the Records). The intent is for the Records to be in accordance with Good Utility Practice to ensure that the Records will be at least sufficient to enable Owner and/or their authorized representatives to conduct thorough operational, technical, and regulatory audits related to the Facility. The Records will be maintained for the greater of (a) Operators document retention program requirements or (b) as is required by Applicable Laws.
ARTICLE XII MISCELLANEOUS 12.1 Notices. Any notice pertaining to this Agreement shall be in writing and sent via facsimile transmittal, registered or certified mail (postage prepaid), hand delivery or by commercial overnight courier, to the other Party, at its respective address designated in this Agreement as set forth below. Each Party shall have the right to change the contact information set forth herein by sending a similar notice to the other Party in like manner. Notices, demands, offers or other written instruments shall be deemed to have been duly given on the date actually received by the intended recipient.
If to Operator:
Constellation Energy Generation, LLC 4300 Winfield Road Warrenville, Illinois 60555 Attn: Chief Nuclear Officer
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 11 Fax: 630-657-4323 If to Owner:
Constellation FitzPatrick, LLC 268 Lake Road Oswego, New York 13126 Attn: Site Vice President Fax: 315-349-6480 12.2 Complete Agreement. This Agreement sets forth the entire understanding of the Parties and supersedes any and all prior agreements, arrangements, or understandings relating to the subject matter hereof.
12.3 Construction of Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement.
12.4 Amendments. The terms of this Agreement shall be modified only by a written document signed by an authorized representative of each Party, which authorizes a change in this Agreement. No purported oral modification, waiver, or rescission of this Agreement by an employee or agent of any Party shall operate as a modification, waiver, or rescission of any of the provisions of this Agreement. No course of prior dealing, usage of trade, and course of performance shall be used to modify, supplement, or explain any terms of this Agreement. In addition, to the extent required by the NRC Facility license, written consent from the NRC may also be required.
12.5 No Third Party Beneficiaries. A person who is not a Party to this Agreement may not enforce any of its terms and the provisions of this Agreement are intended for the sole benefit of Owner and Operator and there are no third party beneficiaries hereof, other than their permitted successors and assigns pursuant to the relevant provisions hereof.
12.6 Governing Law; Interpretation; Severability. This Agreement shall be interpreted, governed and construed in accordance with the laws of the Commonwealth of Pennsylvania, and excluding any conflict of laws rule or principle that might refer the governance or the construction of this Agreement to the law of another jurisdiction. The provisions of this Agreement shall be interpreted where possible in a manner to sustain their legality and enforceability. The unenforceability of any provision of this Agreement in a specific situation shall not affect the enforceability of that provision in another situation or the remaining provisions of this Agreement. Subject to the terms of this Agreement, the Parties shall have all rights and remedies at law or in equity.
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC Page 12 12.7 Assignment. No Party may assign its right, title, and interest in this Agreement to any other Person without the prior written consent of the other Party.
12.8 Execution; Counterparts. This Agreement shall not be binding or effective until properly executed by each Party. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which shall constitute one and the same Agreement, and it shall not be necessary in making proof of this Agreement to produce or account for more than one such fully executed counterpart.
12.9 Survival. The following Articles and Sections shall survive termination of this Agreement: Articles VIII and IX in addition to any other provisions which by their nature should, or by their express terms do, survive or extend beyond the Term of this Agreement.
12.10 Waiver. Either Partys waiver of any breach or failure to enforce any of the terms, covenants, conditions, or other provisions of this Agreement at any time shall not in any way affect, limit, modify, or waive that Partys right thereafter to enforce or compel strict compliance with every term, covenant, condition, or other provision hereof, any course of dealing or custom of the trade notwithstanding. All waivers of any term, covenant, condition or other provision of this Agreement must be given in writing.
Nuclear Operating Services Agreement Constellation FitzPatrick, LLC OPERATOR: Constellation Energy Generation, LLC By:
Name: Bryan Hanson
Title:
Executive Vice President & Chief Generation Officer OWNER: Constellation FitzPatrick, LLC By:
Name: Bryan Hanson
Title:
President
Nuclear Operating Services Agreement - Exhibit A Constellation FitzPatrick, LLC Page 1 EXHIBIT A Characterization of Costs For avoidance of doubt, the Services may include, but will not be limited to, those described under the subheadings below:
The following corporate nuclear support functions at Operators Nuclear Division will be allocated costs through the INPO formula as Nuclear Corporate Services Chief Nuclear Officer and staff Nuclear oversight Nuclear human resources o Talent development o Recruiting Labor relations Engineering and technical services governance and oversight o Programs and design engineering o Nuclear fuel procurement o Project management o Asset management Operational support services governance and oversight o Operations oversight and nuclear duty office o Maintenance and work management o Radiation protection, chemistry and environmental o Industrial safety o Training Outage services o Reactor and turbine maintenance o Inspection services o Vendor alliance management o Outage planning and scheduling Decommissioning and spent fuel management Security Emergency preparedness Nuclear finance and accounting o Financial reports o Business planning Licensing and regulatory o Common regulatory and industry fees o Government affairs Payroll and associated employee costs and benefits of allocated employees
Nuclear Operating Services Agreement - Exhibit A Constellation FitzPatrick, LLC Page 2 Travel and living for business expenses of allocated employees Facility rent and utilities The following nuclear support functions will be performed at the Site and be direct costs Payroll and associated site employee costs and benefits Travel and living for business expenses of site employees Materials, parts, equipment and chemicals Service contracts performed at the site Waste disposal Outage services Facility cost The following Nuclear Services will not be performed at the Site and will be direct costs Corporate managed site specific projects (e.g. license amendments, large equipment replacements)
Nuclear fuel design and analysis Financial support for financial reports and reporting Roving outage services support The following administrative functions will be allocated costs through the INPO formula as Nuclear Corporate Services Strategic supply and procurement IT support and development for fleet wide systems and equipment Payroll and accounts payable processing General legal support Benefits administration The following administrative functions will be performed at the Site and will be direct costs IT staff and equipment Supply procurement and materials management functions Communications staff Human resources The following administrative functions will not be performed at the Site and will be direct costs Legal support on specific matters relating to a site Property tax negotiation Labor negotiations
Nuclear Operating Services Agreement - Exhibit A Constellation FitzPatrick, LLC Page 3 Corporate managed site-specific projects
Constellation Energy Generation, LLC Nuclear Operating Services Agreement with Nine Mile Point Nuclear Station, LLC
EXECUTION VERSION NUCLEAR OPERATING SERVICES AGREEMENT FOR NINE MILE POINT NUCLEAR STATION, LLC This Nuclear Operating Services Agreement (this Agreement or NOSA) dated as of February 1, 2022 (the Commencement Date) is entered into by and among Constellation Energy Generation, LLC, a Pennsylvania limited liability company (Operator), and Nine Mile Point Nuclear Station, LLC, a Delaware limited liability company (Owner). Operator and Owner are referred to individually herein as a Party and collectively herein as the Parties.
RECITALS WHEREAS, Owner desires to continue engaging the services of a qualified operator to provide corporate, operational and managerial support services and other services for the Facility; WHEREAS, Operator has the requisite experience and expertise in providing corporate, operational and managerial support services and possesses the resources and capabilities to continue providing such services for the Facility under Owners ownership and to operate the Facility as part of Operators Fleet of nuclear power plants; and WHEREAS, Owner desires to continue engaging Operator to perform the Services (as defined herein) and Operator desires to continue performing such Services as provided herein; NOW THEREFORE, in consideration for the premises and the representations, warranties, and covenants contained herein, and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
ARTICLE I DEFINITIONS 1.1 Definitions. As used in this Agreement, the following terms shall have the meanings indicated:
Act means the Atomic Energy Act of 1954, as amended.
Affiliate means, with respect to any Person, any other Person directly or indirectly Controlled by, Controlling or under common Control with such Person.
Agreement has the meaning set forth in the preamble.
Allocated Costs means the costs incurred by Operator associated with providing the Services (other than Direct Costs) allocated to each nuclear facility in Operators Fleet in accordance with Section 7.1(b).
Applicable Law means any federal, state or local statute, law, rule, regulation, code, ordinance, judgment, decree or writ of any Governmental Authority, and any official interpretations thereof, regulating, relating to or imposing liability or standards of conduct concerning Owner, Operator, the Site, the Facility or the performance of the Services.
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 2 Commencement Date has the meaning set forth in the Preamble.
Control means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of securities, by contract or otherwise. The terms Controlled and Controlling shall have correlative meanings.
Decommission and Decommissioning mean (1) the complete retirement and removal of the Facility from service and the restoration of the Site to a status that permits the Site and spent fuel storage installation to be released for unrestricted use in accordance with the NRC regulations, as well as any planning and administrative activities incidental thereto, including (a) reducing residual radioactivity at the Site and spent fuel storage installation to levels meeting the NRC radiological release criteria and any other actions necessary to obtain termination of the NRC License and (b) all other activities necessary for the retirement, dismantlement, and decontamination of the Facility to comply with all applicable requirements of the Act, the NRC rules, regulations, orders and pronouncements thereunder and any related decommissioning plan, environmental laws and other laws; and (2) any other environmental remediation and Site restoration of or relating to the Site or the Facilities as required by Applicable Law or applicable agreements.
Direct Cost has the meaning set forth in Section 7.1(a).
Facility has the meaning set forth in the Whereas clauses hereof.
Good Utility Practice means at any time those practices, methods, techniques and standards in effect at the time of performance of the Services hereunder that are commonly used in the United States in prudent management and maintenance of equipment of, and the provision of operational support services for, nuclear generating stations. Without limiting the foregoing, Good Utility Practice is also intended to be the practices, methods, techniques and standards utilized by Operator in operational and managerial support services for its owned, affiliated, managed or operated nuclear generating facilities located in the United States, and as generally accepted in the industry with respect to the management and maintenance of, and the provision of services for, nuclear generating stations located in the United States and the exercise of that degree of skill, diligence, prudence and foresight which would reasonably and ordinarily be expected at such time from a skilled and experienced provider of services similar to the Services.
Governmental Approval means any authorization, consent, approval, license, ruling, waiver, permit, certification, exemption, filing, declaration or registration by or with any Governmental Authority having jurisdiction over any of the Site, the Facility, the Services or the Parties.
Governmental Authority means all federal, state and local governments and all agencies, authorities, departments, instrumentalities, courts, or other subdivisions of each having executive, legislative, judicial, regulatory or administrative jurisdiction over any of the Site, the Facility, the Services or the Parties.
INPO Allocation Method means the method for allocating costs incurred by Operator in respect of Operators Fleet to each nuclear facility in Operators Fleet in the same manner as the Institute
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 3 of Nuclear Power Operations allocates its fees, whereby the Site with an operating reactor is allocated three (3) points and each operating reactor in Operators Fleet is allocated one (1) point (e.g., four (4) points for single units, five (5) points for dual units). For each billing period, the Allocated Costs charged to the Facility will be equal to (a) the aggregate amount of Allocated Costs incurred by Operator during such billing period; multiplied by (b) a fraction, the numerator of which is the INPO points attributed to the Facility, and the denominator of which is the total number of INPO points attributed to all facilities in Operators Fleet.
IP means any information and any other intellectual property of any type whatsoever, in any tangible or intangible form or medium, and all rights associated therewith in any jurisdiction, including any proprietary management processes of Operator and its Affiliates, and the Operators Nuclear Management Model.
NRC means the United States Nuclear Regulatory Commission and any successor agency established in the United States for the regulation of civilian nuclear power.
NRC Licenses means the licenses for the Facility issued to Owner and Operator pursuant to the regulations of the NRC.
Operator Personnel means the personnel from Operators or any of its Affiliates or Subcontractors organizations, agents, counsel, and advisors performing Services under this Agreement.
Operators Fleet means the Facility taken together with each other nuclear facility for which Operator is the NRC licensed operator under contract or by ownership.
Operators Nuclear Management Model means Operators proprietary nuclear management model and related management systems, including software programs, policies, processes and procedures relative to the management, operation and maintenance of Operators nuclear generating facilities, as updated by Operator from time to time.
Owners Contracts means any other contracts to which Owner is a party for (1) procuring engineering or materials, tools, supplies, or equipment necessary for capital expenditures or repairs of the Facility, (2) construction of any capital expenditures with respect to the Facility, (3) the repair of the Facility, (4) the purchasing or leasing of equipment with respect to the Facility, (5) utilities necessary for the operation of the Facility, or (6) any other material services; provided that Owner Contracts do not include this Agreement, the Subcontracts, or any of Owners commercial agreements not directly related to operations (such as financing and power purchase agreements).
Party or Parties has the meaning set forth in the preamble.
Person means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or any federal, state, local or other governmental entity, body or authority.
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 4 Records has the meaning set forth in Article XI.
Reimbursable Costs has the meaning set forth in Section 7.2.
Services has the meaning set forth in Section 3.1.
Site means the real property on which the Facility is located including surrounding land owned by the Owner or its Affiliates.
Subcontract means any agreement by Operator with a Subcontractor for the performance of any portion of the Services.
Subcontractor means any vendor, supplier, manufacturer, material man, Operator or subcontractor (other than Operator or its Affiliates) that is contracted directly with Operator to perform any part of the Services or providing other services or supplies in connection with the Services.
Taxes means all fees, taxes (including sales taxes, use taxes, stamp taxes, value-added taxes, ad valorem taxes and property taxes (personal and real, tangible and intangible)), levies, assessments, customs duties, withholdings and other charges and impositions of any nature, other than taxes based on net income or net worth, plus all related interest, penalties, fines and additions to tax, now or hereafter imposed by any Governmental Authority or other taxing authority.
Term has the meaning set forth in Section 2.1.
Termination Date has the meaning set forth in Section 10.2(a).
Transition Period has the meaning set forth in Section 10.3.
ARTICLE II TERM; COMMENCEMENT OF SERVICES 2.1 Term. The term of this Agreement (the Term) shall begin on the Commencement Date and shall continue through Decommissioning unless terminated earlier as provided herein.
ARTICLE III OPERATOR RESPONSIBILITIES; SCOPE OF RELATIONSHIP 3.1 Services. Subject to the terms of this Agreement, Operator shall (a) provide corporate and administrative services necessary for the operation of the Facility as the NRC licensed operator and to operate its business, in accordance with historic practice, Applicable Law, and contractual obligations, (b) manage, operate, maintain and Decommission the Facility as the NRC licensed operator in accordance with the NRC Licenses and Applicable Law, and on behalf of Owner on a basis consistent in all material respects with Good Utility Practices and Operators Nuclear Management Model and (c) be responsible for the management and interim storage of spent nuclear fuel at the Facility in accordance with Applicable Law relating to the use, handling
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 5 and disposal of radioactive materials, including obligations under the Nuclear Waste Policy Act of 1982 (together, the Services).
3.2 Contract Management Services. Without limit the foregoing, Operator will assist Owner with the implementation and management of any Owner Contracts. Notwithstanding the foregoing, Owners shall remain solely responsible and liable for the Owner Contracts. Operator may from time to time act as Owners agent on Owners behalf with respect to managing and overseeing the Owner contracts.
3.3 Relationship of the Parties. In performing the Services, Operator shall be an independent contractor of Owner.
3.4 Subcontractors. Operator or its Affiliates may contract a Subcontractor to perform any part or parts of the Services. Notwithstanding the foregoing, Operator shall at all times remain solely responsible for the quality, timeliness and professionalism of all Subcontractors and the performance of the Services. Operator shall be fully responsible for the acts and omissions of its Subcontractors. For the avoidance of doubt, Operator shall remain solely responsible and liable for any Subcontractor contracts to which Operator, and not Owner, is a party.
3.5 Reports. At the request of Owner, Operator shall provide Owner with and submit in accordance with Applicable Law standard operational and financial reports in accordance with its Operators Nuclear Management Model.
3.6 Employees. Services will be performed by employees of Operator or its Affiliates.
Operator may, subject to the terms hereof, elect to transfer employees from employment by Owner to employment by Operator, loan Operator employees to provide Services to Owner, or transfer employees from employment by Operator to employment by Owner (provided that if Operator transfers Operator employees to employment by Owner, Operator will indemnify Owner for liabilities arising solely from such employment, other than Allocated Costs or Direct Costs chargeable under the terms of this Agreement). Operator may elect to assign employees of Owner on a short-term basis to provide services to operations of Operator other than the Facility, so long as such costs are allocated in a manner consistent with the allocation of Direct Costs in this Agreement, for the use of those employees and Operator indemnifies Owner solely for any liability arising from the performance of Owners employees at a location other than the Facility.
ARTICLE IV OWNERS RESPONSIBILITIES 4.1 Ownership and Operation of Facility. On the Commencement Date, Owner will continue to own the Facility and Operator will continue to operate the Facility, provided that Owner and Operator have all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator. After the Commencement Date, Owner will ensure that Operator has access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information necessary to comply
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 6 with Owner quality assurance plan, and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
4.2 Liabilities. Owner shall be responsible for the performance or discharge of any liabilities relating to the Facility arising prior to the Commencement Date, except for those liabilities for which Operator is expressly liable under the terms of this Agreement. From and after the Commencement Date, each Party shall be responsible for the performance or discharge of their respective liabilities relating to the Facility.
4.3 Cooperation. As necessary, Owner shall furnish to Operator the information or assistance as may be required for Operator to comply with the terms of this Agreement and for the expeditious and orderly performance of the Services by Operator.
4.4 Access to the Facility and the Site. Subject to applicable security and access rules and regulations, Owner shall provide Operator access to the Facility and Site as required for performance of the Services and copies of all licenses, easements or other agreements Owner has entered or may enter into regarding access to the Facility and the Site that affect Operator or the Services. Owner shall ensure that Operator has the full and uninterrupted benefit of all such licenses, easements or other agreements and shall ensure that such licenses, easements or other agreements do not adversely affect Operators performance of the Services.
4.5 Owner Information. Owner shall act in good faith to assure that all information and materials given by Owner to Operator are accurate when given in all material respects.
4.6 Appointment as Agent. Owner does hereby grant to Operator and its Affiliates, as agent for Owner, individually or collectively, the power and authority to exercise in accordance with Applicable Laws the rights of Owner under, and to execute, modify, amend or terminate, any contracts, including without limitation, leases easements, agreements, purchase orders, licenses, permits and privileges relating to the operation and maintenance of, and making capital improvements to, the Facility. Nonetheless, unless otherwise agreed in writing, Owner shall remain solely responsible for each of the contracts to which Owner, and not Operator, is a party.
ARTICLE V OPERATORS RESPONSIBILITIES 5.1 Continued Operation of Facility On the Commencement Date, Operator shall continue to be responsible for day-to-day management activities and operation of the Facility, provided that Owner and Operator have (i) all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator and (ii) all equipment, materials, spare parts and consumables necessary for Operator to provide the Services. After the Commencement Date, Operator shall retain access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information necessary to comply with Owners quality assurance plan and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 7 5.2 Governmental Approvals. Operator shall support and assist Owner as may be reasonably required in order for Owner to obtain and maintain all Governmental Approvals (a) required by Applicable Law for Owner to own and Operator to operate the Facility and (b) required by Applicable Law for Operator to perform the Services, including, without limitation, the NRC Licenses and those related to nuclear safety.
5.3 NRC Licenses. Operator will hold and maintain the NRC Licenses required to operate the Facility for the duration of the Term.
5.4 Assistance to Owner. Operator shall furnish to Owner the information or assistance as may be reasonably necessary in order to enable Owner to comply with its obligations under Article IV and for the expeditious and orderly operation of the Facility.
5.5 Performance Standards. Operator shall perform the Services: (a) in compliance with the terms of this Agreement; (b) in compliance with the standards and objectives of Operators Nuclear Management Model as adapted to the Facility, as the same may change from time to time; and (c) in a good and workmanlike manner in accordance with the NRC Licenses and Applicable Law, and consistent with Good Utility Practice.
5.6 Taxes and Benefits. During the Term of this Agreement, Operator shall be solely responsible for providing or causing to be provided to each member of Operator Personnel his or her compensation and benefits, and shall further be solely responsible to issue or cause to issue IRS W-2 forms for Operator Personnel and for all taxes, workers compensation, social security, unemployment, and other contributions for benefits measured by salary payable to Operator Personnel.
5.7 Operator Employees. Except as provided in Section 7.1, Operator shall be solely responsible for (a) all compensation, benefits and other employer obligations in respect of employees of Operator or its Affiliates providing Services under this Agreement, (b) training and oversight of employees of Operator or its Affiliates providing Services under this Agreement and (c) all employment decisions with respect to employees of Operator or its Affiliates providing Services under this Agreement.
ARTICLE VI BUDGET 6.1 Annual Budget. Operator shall prepare and propose an annual budget and a business plan.
ARTICLE VII COST REIMBURSEMENT 7.1 Cost Reimbursement. From and after the Commencement Date and continuing throughout the Term, Operator shall be entitled to be reimbursed for the following costs incurred by Operator, its Subcontractors, or its Affiliates in performance of the Services:
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 8 (a)
Direct Costs. All direct costs of Operator of providing any Service that would not constitute Allocated Costs pursuant to Section 7.1(b), including without limitation: (i) the costs of Operator Personnel performing the Services at the Facility, including travel and relocation expenses where applicable; (ii) any costs incurred by Operator associated with improvements to existing systems, integration into Operator systems, and software programs required to implement Operators Nuclear Management Model and CFAM (Corporate Functional Area Manager) philosophy at each Facility; and (iii) all costs incurred by Operator (including the cost of any Subcontractors) related to materials, services, equipment, Taxes (other than those imposed in respect of income or revenues of Operator) and other expenditures (as an agent of the Owner) that are required in the good faith judgment of Operator to operate the Facility in accordance with Good Utility Practice, in each case as described in Exhibit A (such costs collectively, the Direct Costs). The Direct Costs will be allocated on a basis consistent with Operators similar costs as allocated to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time).
(b)
Allocated Costs. All Allocated Costs based on the INPO Allocation Method, calculated based on the Facility being part of Operators Fleet as described in Exhibit A; provided that such allocation is non-discriminatory and on a basis consistent with Operators allocation of similar costs as invoiced to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time). For avoidance of doubt, certain personnel-related reimbursements may be classified as Allocated Costs, including the travel and relocation expenses of certain personnel. For the avoidance of doubt, in no event shall Allocated Costs include any item to the extent such item is also invoiced as a Direct Cost.
7.2 Tracking Costs. Operator shall track all Direct Costs and Allocated Costs (together the Reimbursable Costs) incurred by Operator in operating the Facility.
Notwithstanding any other provision in this Agreement, all costs associated with Decommissioning the Facility are the responsibility of Owner and, to the extent such costs are allowed by Applicable Law to be reimbursed from any Decommissioning trust funds maintained for the Facility, shall be paid for from such funds.
ARTICLE VIII TAXES 8.1 Taxes. Each Party shall be responsible for all Taxes to which it is subject, which Taxes arise out of or are in any way connected with this Agreement. If, under Applicable Law, Operator is required to collect any such Taxes from Owner, Operator shall settle the collection of such Taxes by intercompany accounting.
ARTICLE IX INSURANCE 9.1 Operator Insurance. Operator shall procure and maintain insurance coverage during the Term in the type and amount consistent with insurance covering Operators Fleet and in accordance with Good Utility Practice.
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 9 ARTICLE X TERMINATION 10.1 Termination. During the Term, this Agreement may be terminated by Owner, at its discretion, provided that Owner obtains all required Governmental Approvals required to transfer operation of the Facility to Owner or another Person selected by Owner. Operator shall continue to perform all Services contemplated by this Agreement until Owner has secured all such required Governmental Approvals, including approval from the NRC.
10.2 Actions upon Termination. Prior to the effective date of any termination under this Article X, the Parties shall work in good faith to ensure a satisfactory transfer of responsibility in process and cooperate to obtain all Governmental Approvals (if any and to the extent allowed) required for such transfer. Upon a termination in accordance with Section 10.1, Operator shall:
(a) discontinue performance of the Services on the date agreed upon by the parties (the Termination Date),
(b) place no further orders or enter into any Subcontracts for items or Services unless required for standby, demobilization, remobilization or as otherwise provided in this Article 10; (c) subject to the terms of this Agreement, cooperate with Owner in the transfer to Owner of items or information and disposition of the Services in progress; (d) inventory and turn over to Owner all equipment and materials purchased by Operator and reimbursed by Owner in accordance with the terms of this Agreement and any other equipment or other items provided by Owner for performance of the terminated or suspended Services; (e) cooperate with Owner and their agents and representatives in the turnover of the Services and transition of the employees, as appropriate, to Owner (or their designated successor Operator in the event of termination) who shall provide operational support services for the Facility; and (f) up to and including the Termination Date, Operator shall continue to perform the Services hereunder in accordance with Good Utility Practices and in accordance with the terms of this Agreement; provided that Operator shall be entitled to and shall collect all compensation in accordance with this Agreement (including Reimbursable Costs payable under the terms of this Agreement and any additional reasonable out-of-pocket costs incurred in providing transition assistance to Owner or their successor Operator during such time) through intercompany accounting.
10.3 Post-Termination Transition Period. Owners right to use the IP will automatically cease at the Termination Date; provided that Owner will be entitled to continue to use the IP on a transitional period for a period of 12 months following the Termination Date (such period, the Transition Period) to the extent necessary to provide an orderly transition off of
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 10 Operators systems and software platforms. During the Transition Period, Operator shall cooperate and provide reasonable assistance to Owner in effecting such IP transition; provided that Owner reimburses Operator for Operators actual cost of providing such transition services and permitting continued use of IP, determined in the same manner that costs are allocated and charged pursuant to Article VII of this Agreement.
ARTICLE XI RECORDS In accordance with its standard corporate practices, Operator will at all times operate a system of accounting and maintain complete and accurate records and supporting documentation in relation to the performance of its obligations under this Agreement, provided that documentation related to the provision and performance of the Services shall be maintained for the greater of five years or as required by Applicable Law. Operator shall collaborate with and assist Owner to operate a system of accounting and maintain complete and accurate records in relation to the operation of the Facility, including Services rendered by Operator (the Records). The intent is for the Records to be in accordance with Good Utility Practice to ensure that the Records will be at least sufficient to enable Owner and/or their authorized representatives to conduct thorough operational, technical, and regulatory audits related to the Facility. The Records will be maintained for the greater of (a) Operators document retention program requirements or (b) as is required by Applicable Laws.
ARTICLE XII MISCELLANEOUS 12.1 Notices. Any notice pertaining to this Agreement shall be in writing and sent via facsimile transmittal, registered or certified mail (postage prepaid), hand delivery or by commercial overnight courier, to the other Party, at its respective address designated in this Agreement as set forth below. Each Party shall have the right to change the contact information set forth herein by sending a similar notice to the other Party in like manner. Notices, demands, offers or other written instruments shall be deemed to have been duly given on the date actually received by the intended recipient.
If to Operator:
Constellation Energy Generation, LLC 4300 Winfield Road Warrenville, Illinois 60555 Attn: Chief Nuclear Officer Fax: 630-657-4323 If to Owner:
Nine Mile Point Nuclear Power Station, LLC 348 Lake Road
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 11 Oswego, New York 13126 Attn: Site Vice President Fax: (315) 349-4308 12.2 Complete Agreement. This Agreement sets forth the entire understanding of the Parties and supersedes any and all prior agreements, arrangements, or understandings relating to the subject matter hereof.
12.3 Construction of Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement.
12.4 Amendments. The terms of this Agreement shall be modified only by a written document signed by an authorized representative of each Party, which authorizes a change in this Agreement. No purported oral modification, waiver, or rescission of this Agreement by an employee or agent of any Party shall operate as a modification, waiver, or rescission of any of the provisions of this Agreement. No course of prior dealing, usage of trade, and course of performance shall be used to modify, supplement, or explain any terms of this Agreement. In addition, to the extent required by the NRC Facility license, written consent from the NRC may also be required.
12.5 No Third Party Beneficiaries. A person who is not a Party to this Agreement may not enforce any of its terms and the provisions of this Agreement are intended for the sole benefit of Owner and Operator and there are no third party beneficiaries hereof, other than their permitted successors and assigns pursuant to the relevant provisions hereof.
12.6 Governing Law; Interpretation; Severability. This Agreement shall be interpreted, governed and construed in accordance with the laws of the Commonwealth of Pennsylvania, and excluding any conflict of laws rule or principle that might refer the governance or the construction of this Agreement to the law of another jurisdiction. The provisions of this Agreement shall be interpreted where possible in a manner to sustain their legality and enforceability. The unenforceability of any provision of this Agreement in a specific situation shall not affect the enforceability of that provision in another situation or the remaining provisions of this Agreement. Subject to the terms of this Agreement, the Parties shall have all rights and remedies at law or in equity.
12.7 Assignment. No Party may assign its right, title, and interest in this Agreement to any other Person without the prior written consent of the other Party.
12.8 Execution; Counterparts. This Agreement shall not be binding or effective until properly executed by each Party. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which shall constitute one and the same Agreement, and it shall not be necessary in making proof of this Agreement to produce or account for more than one such fully executed counterpart.
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC Page 12 12.9 Survival. The following Articles and Sections shall survive termination of this Agreement: Articles VIII and IX in addition to any other provisions which by their nature should, or by their express terms do, survive or extend beyond the Term of this Agreement.
12.10 Waiver. Either Partys waiver of any breach or failure to enforce any of the terms, covenants, conditions, or other provisions of this Agreement at any time shall not in any way affect, limit, modify, or waive that Partys right thereafter to enforce or compel strict compliance with every term, covenant, condition, or other provision hereof, any course of dealing or custom of the trade notwithstanding. All waivers of any term, covenant, condition or other provision of this Agreement must be given in writing.
Nuclear Operating Services Agreement Nine Mile Point Nuclear Station, LLC OPERATOR: Constellation Energy Generation, LLC By:
Name: Bryan Hanson
Title:
Executive Vice President & Chief Generation Officer OWNER: Nine Mile Point Nuclear Station, LLC By:
Name: Bryan Hanson
Title:
Senior Vice President
Nuclear Operating Services Agreement - Exhibit A Nine Mile Point Nuclear Station, LLC Page 1 EXHIBIT A Characterization of Costs For avoidance of doubt, the Services may include, but will not be limited to, those described under the subheadings below:
The following corporate nuclear support functions at Operators Nuclear Division will be allocated costs through the INPO formula as Nuclear Corporate Services Chief Nuclear Officer and staff Nuclear oversight Nuclear human resources o Talent development o Recruiting Labor relations Engineering and technical services governance and oversight o Programs and design engineering o Nuclear fuel procurement o Project management o Asset management Operational support services governance and oversight o Operations oversight and nuclear duty office o Maintenance and work management o Radiation protection, chemistry and environmental o Industrial safety o Training Outage services o Reactor and turbine maintenance o Inspection services o Vendor alliance management o Outage planning and scheduling Decommissioning and spent fuel management Security Emergency preparedness Nuclear finance and accounting o Financial reports o Business planning Licensing and regulatory o Common regulatory and industry fees o Government affairs Payroll and associated employee costs and benefits of allocated employees
Nuclear Operating Services Agreement - Exhibit A Nine Mile Point Nuclear Station, LLC Page 2 Travel and living for business expenses of allocated employees Facility rent and utilities The following nuclear support functions will be performed at the Site and be direct costs Payroll and associated site employee costs and benefits Travel and living for business expenses of site employees Materials, parts, equipment and chemicals Service contracts performed at the site Waste disposal Outage services Facility cost The following Nuclear Services will not be performed at the Site and will be direct costs Corporate managed site specific projects (e.g. license amendments, large equipment replacements)
Nuclear fuel design and analysis Financial support for financial reports and reporting Roving outage services support The following administrative functions will be allocated costs through the INPO formula as Nuclear Corporate Services Strategic supply and procurement IT support and development for fleet wide systems and equipment Payroll and accounts payable processing General legal support Benefits administration The following administrative functions will be performed at the Site and will be direct costs IT staff and equipment Supply procurement and materials management functions Communications staff Human resources The following administrative functions will not be performed at the Site and will be direct costs Legal support on specific matters relating to a site Property tax negotiation Labor negotiations
Nuclear Operating Services Agreement - Exhibit A Nine Mile Point Nuclear Station, LLC Page 3 Corporate managed site-specific projects
Constellation Energy Generation, LLC Nuclear Operating Services Agreement with R. E. Ginna Nuclear Power Plant, LLC
EXECUTION VERSION NUCLEAR OPERATING SERVICES AGREEMENT FOR R.E. GINNA NUCLEAR POWER PLANT, LLC This Nuclear Operating Services Agreement (this Agreement or NOSA) dated as of February 1, 2022 (the Commencement Date) is entered into by and among Constellation Energy Generation, LLC, a Pennsylvania limited liability company (Operator), and R.E. Ginna Nuclear Power Plant, LLC, a Maryland limited liability company (Owner). Operator and Owner are referred to individually herein as a Party and collectively herein as the Parties.
RECITALS WHEREAS, Owner desires to continue engaging the services of a qualified operator to provide corporate, operational and managerial support services and other services for the Facility; WHEREAS, Operator has the requisite experience and expertise in providing corporate, operational and managerial support services and possesses the resources and capabilities to continue providing such services for the Facility under Owners ownership and to operate the Facility as part of Operators Fleet of nuclear power plants; and WHEREAS, Owner desires to continue engaging Operator to perform the Services (as defined herein) and Operator desires to continue performing such Services as provided herein; NOW THEREFORE, in consideration for the premises and the representations, warranties, and covenants contained herein, and for other good and valuable consideration, the sufficiency and receipt of which are hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
ARTICLE I DEFINITIONS 1.1 Definitions. As used in this Agreement, the following terms shall have the meanings indicated:
Act means the Atomic Energy Act of 1954, as amended.
Affiliate means, with respect to any Person, any other Person directly or indirectly Controlled by, Controlling or under common Control with such Person.
Agreement has the meaning set forth in the preamble.
Allocated Costs means the costs incurred by Operator associated with providing the Services (other than Direct Costs) allocated to each nuclear facility in Operators Fleet in accordance with Section 7.1(b).
Applicable Law means any federal, state or local statute, law, rule, regulation, code, ordinance, judgment, decree or writ of any Governmental Authority, and any official interpretations thereof,
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 2 regulating, relating to or imposing liability or standards of conduct concerning Owner, Operator, the Site, the Facility or the performance of the Services.
Commencement Date has the meaning set forth in the Preamble.
Control means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of an entity, whether through the ownership of securities, by contract or otherwise. The terms Controlled and Controlling shall have correlative meanings.
Decommission and Decommissioning mean (1) the complete retirement and removal of the Facility from service and the restoration of the Site to a status that permits the Site and spent fuel storage installation to be released for unrestricted use in accordance with the NRC regulations, as well as any planning and administrative activities incidental thereto, including (a) reducing residual radioactivity at the Site and spent fuel storage installation to levels meeting the NRC radiological release criteria and any other actions necessary to obtain termination of the NRC License and (b) all other activities necessary for the retirement, dismantlement, and decontamination of the Facility to comply with all applicable requirements of the Act, the NRC rules, regulations, orders and pronouncements thereunder and any related decommissioning plan, environmental laws and other laws; and (2) any other environmental remediation and Site restoration of or relating to the Site or the Facilities as required by Applicable Law or applicable agreements.
Direct Cost has the meaning set forth in Section 7.1(a).
Facility has the meaning set forth in the Whereas clauses hereof.
Good Utility Practice means at any time those practices, methods, techniques and standards in effect at the time of performance of the Services hereunder that are commonly used in the United States in prudent management and maintenance of equipment of, and the provision of operational support services for, nuclear generating stations. Without limiting the foregoing, Good Utility Practice is also intended to be the practices, methods, techniques and standards utilized by Operator in operational and managerial support services for its owned, affiliated, managed or operated nuclear generating facilities located in the United States, and as generally accepted in the industry with respect to the management and maintenance of, and the provision of services for, nuclear generating stations located in the United States and the exercise of that degree of skill, diligence, prudence and foresight which would reasonably and ordinarily be expected at such time from a skilled and experienced provider of services similar to the Services.
Governmental Approval means any authorization, consent, approval, license, ruling, waiver, permit, certification, exemption, filing, declaration or registration by or with any Governmental Authority having jurisdiction over any of the Site, the Facility, the Services or the Parties.
Governmental Authority means all federal, state and local governments and all agencies, authorities, departments, instrumentalities, courts, or other subdivisions of each having executive, legislative, judicial, regulatory or administrative jurisdiction over any of the Site, the Facility, the Services or the Parties.
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 3 INPO Allocation Method means the method for allocating costs incurred by Operator in respect of Operators Fleet to each nuclear facility in Operators Fleet in the same manner as the Institute of Nuclear Power Operations allocates its fees, whereby the Site with an operating reactor is allocated three (3) points and each operating reactor in Operators Fleet is allocated one (1) point (e.g., four (4) points for single units, five (5) points for dual units). For each billing period, the Allocated Costs charged to the Facility will be equal to (a) the aggregate amount of Allocated Costs incurred by Operator during such billing period; multiplied by (b) a fraction, the numerator of which is the INPO points attributed to the Facility, and the denominator of which is the total number of INPO points attributed to all facilities in Operators Fleet.
IP means any information and any other intellectual property of any type whatsoever, in any tangible or intangible form or medium, and all rights associated therewith in any jurisdiction, including any proprietary management processes of Operator and its Affiliates, and the Operators Nuclear Management Model.
NRC means the United States Nuclear Regulatory Commission and any successor agency established in the United States for the regulation of civilian nuclear power.
NRC Licenses means the licenses for the Facility issued to Owner and Operator pursuant to the regulations of the NRC.
Operator Personnel means the personnel from Operators or any of its Affiliates or Subcontractors organizations, agents, counsel, and advisors performing Services under this Agreement.
Operators Fleet means the Facility taken together with each other nuclear facility for which Operator is the NRC licensed operator under contract or by ownership.
Operators Nuclear Management Model means Operators proprietary nuclear management model and related management systems, including software programs, policies, processes and procedures relative to the management, operation and maintenance of Operators nuclear generating facilities, as updated by Operator from time to time.
Owners Contracts means any other contracts to which Owner is a party for (1) procuring engineering or materials, tools, supplies, or equipment necessary for capital expenditures or repairs of the Facility, (2) construction of any capital expenditures with respect to the Facility, (3) the repair of the Facility, (4) the purchasing or leasing of equipment with respect to the Facility, (5) utilities necessary for the operation of the Facility, or (6) any other material services; provided that Owner Contracts do not include this Agreement, the Subcontracts, or any of Owners commercial agreements not directly related to operations (such as financing and power purchase agreements).
Party or Parties has the meaning set forth in the preamble.
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 4 Person means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or any federal, state, local or other governmental entity, body or authority.
Records has the meaning set forth in Article XI.
Reimbursable Costs has the meaning set forth in Section 7.2.
Services has the meaning set forth in Section 3.1.
Site means the real property on which the Facility is located including surrounding land owned by the Owner or its Affiliates.
Subcontract means any agreement by Operator with a Subcontractor for the performance of any portion of the Services.
Subcontractor means any vendor, supplier, manufacturer, material man, Operator or subcontractor (other than Operator or its Affiliates) that is contracted directly with Operator to perform any part of the Services or providing other services or supplies in connection with the Services.
Taxes means all fees, taxes (including sales taxes, use taxes, stamp taxes, value-added taxes, ad valorem taxes and property taxes (personal and real, tangible and intangible)), levies, assessments, customs duties, withholdings and other charges and impositions of any nature, other than taxes based on net income or net worth, plus all related interest, penalties, fines and additions to tax, now or hereafter imposed by any Governmental Authority or other taxing authority.
Term has the meaning set forth in Section 2.1.
Termination Date has the meaning set forth in Section 10.2(a).
Transition Period has the meaning set forth in Section 10.3.
ARTICLE II TERM; COMMENCEMENT OF SERVICES 2.1 Term. The term of this Agreement (the Term) shall begin on the Commencement Date and shall continue through Decommissioning unless terminated earlier as provided herein.
ARTICLE III OPERATOR RESPONSIBILITIES; SCOPE OF RELATIONSHIP 3.1 Services. Subject to the terms of this Agreement, Operator shall (a) provide corporate and administrative services necessary for the operation of the Facility as the NRC licensed operator and to operate its business, in accordance with historic practice, Applicable Law, and contractual obligations, (b) manage, operate, maintain and Decommission the Facility as the
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 5 NRC licensed operator in accordance with the NRC Licenses and Applicable Law, and on behalf of Owner on a basis consistent in all material respects with Good Utility Practices and Operators Nuclear Management Model and (c) be responsible for the management and interim storage of spent nuclear fuel at the Facility in accordance with Applicable Law relating to the use, handling and disposal of radioactive materials, including obligations under the Nuclear Waste Policy Act of 1982 (together, the Services).
3.2 Contract Management Services. Without limit the foregoing, Operator will assist Owner with the implementation and management of any Owner Contracts. Notwithstanding the foregoing, Owners shall remain solely responsible and liable for the Owner Contracts. Operator may from time to time act as Owners agent on Owners behalf with respect to managing and overseeing the Owner contracts.
3.3 Relationship of the Parties. In performing the Services, Operator shall be an independent contractor of Owner.
3.4 Subcontractors. Operator or its Affiliates may contract a Subcontractor to perform any part or parts of the Services. Notwithstanding the foregoing, Operator shall at all times remain solely responsible for the quality, timeliness and professionalism of all Subcontractors and the performance of the Services. Operator shall be fully responsible for the acts and omissions of its Subcontractors. For the avoidance of doubt, Operator shall remain solely responsible and liable for any Subcontractor contracts to which Operator, and not Owner, is a party.
3.5 Reports. At the request of Owner, Operator shall provide Owner with and submit in accordance with Applicable Law standard operational and financial reports in accordance with its Operators Nuclear Management Model.
3.6 Employees. Services will be performed by employees of Operator or its Affiliates.
Operator may, subject to the terms hereof, elect to transfer employees from employment by Owner to employment by Operator, loan Operator employees to provide Services to Owner, or transfer employees from employment by Operator to employment by Owner (provided that if Operator transfers Operator employees to employment by Owner, Operator will indemnify Owner for liabilities arising solely from such employment, other than Allocated Costs or Direct Costs chargeable under the terms of this Agreement). Operator may elect to assign employees of Owner on a short-term basis to provide services to operations of Operator other than the Facility, so long as such costs are allocated in a manner consistent with the allocation of Direct Costs in this Agreement, for the use of those employees and Operator indemnifies Owner solely for any liability arising from the performance of Owners employees at a location other than the Facility.
ARTICLE IV OWNERS RESPONSIBILITIES 4.1 Ownership and Operation of Facility. On the Commencement Date, Owner will continue to own the Facility and Operator will continue to operate the Facility, provided that Owner and Operator have all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator. After the Commencement Date, Owner
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 6 will ensure that Operator has access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information necessary to comply with Owner quality assurance plan, and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
4.2 Liabilities. Owner shall be responsible for the performance or discharge of any liabilities relating to the Facility arising prior to the Commencement Date, except for those liabilities for which Operator is expressly liable under the terms of this Agreement. From and after the Commencement Date, each Party shall be responsible for the performance or discharge of their respective liabilities relating to the Facility.
4.3 Cooperation. As necessary, Owner shall furnish to Operator the information or assistance as may be required for Operator to comply with the terms of this Agreement and for the expeditious and orderly performance of the Services by Operator.
4.4 Access to the Facility and the Site. Subject to applicable security and access rules and regulations, Owner shall provide Operator access to the Facility and Site as required for performance of the Services and copies of all licenses, easements or other agreements Owner has entered or may enter into regarding access to the Facility and the Site that affect Operator or the Services. Owner shall ensure that Operator has the full and uninterrupted benefit of all such licenses, easements or other agreements and shall ensure that such licenses, easements or other agreements do not adversely affect Operators performance of the Services.
4.5 Owner Information. Owner shall act in good faith to assure that all information and materials given by Owner to Operator are accurate when given in all material respects.
4.6 Appointment as Agent. Owner does hereby grant to Operator and its Affiliates, as agent for Owner, individually or collectively, the power and authority to exercise in accordance with Applicable Laws the rights of Owner under, and to execute, modify, amend or terminate, any contracts, including without limitation, leases easements, agreements, purchase orders, licenses, permits and privileges relating to the operation and maintenance of, and making capital improvements to, the Facility. Nonetheless, unless otherwise agreed in writing, Owner shall remain solely responsible for each of the contracts to which Owner, and not Operator, is a party.
ARTICLE V OPERATORS RESPONSIBILITIES 5.1 Continued Operation of Facility On the Commencement Date, Operator shall continue to be responsible for day-to-day management activities and operation of the Facility, provided that Owner and Operator have (i) all approvals required by Applicable Law for Operator to continue performing the Services as the NRC licensed operator and (ii) all equipment, materials, spare parts and consumables necessary for Operator to provide the Services. After the Commencement Date, Operator shall retain access to (a) all original equipment manufacturer instructions and manuals relating to the equipment at the Facility, (b) all specifications, analyses, operating manuals and instructions, drawings (including as-built drawings), (c) all information
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 7 necessary to comply with Owners quality assurance plan and (d) all records related to the construction of the Facility necessary for Operator to perform the Services.
5.2 Governmental Approvals. Operator shall support and assist Owner as may be reasonably required in order for Owner to obtain and maintain all Governmental Approvals (a) required by Applicable Law for Owner to own and Operator to operate the Facility and (b) required by Applicable Law for Operator to perform the Services, including, without limitation, the NRC Licenses and those related to nuclear safety.
5.3 NRC Licenses. Operator will hold and maintain the NRC Licenses required to operate the Facility for the duration of the Term.
5.4 Assistance to Owner. Operator shall furnish to Owner the information or assistance as may be reasonably necessary in order to enable Owner to comply with its obligations under Article IV and for the expeditious and orderly operation of the Facility.
5.5 Performance Standards. Operator shall perform the Services: (a) in compliance with the terms of this Agreement; (b) in compliance with the standards and objectives of Operators Nuclear Management Model as adapted to the Facility, as the same may change from time to time; and (c) in a good and workmanlike manner in accordance with the NRC Licenses and Applicable Law, and consistent with Good Utility Practice.
5.6 Taxes and Benefits. During the Term of this Agreement, Operator shall be solely responsible for providing or causing to be provided to each member of Operator Personnel his or her compensation and benefits, and shall further be solely responsible to issue or cause to issue IRS W-2 forms for Operator Personnel and for all taxes, workers compensation, social security, unemployment, and other contributions for benefits measured by salary payable to Operator Personnel.
5.7 Operator Employees. Except as provided in Section 7.1, Operator shall be solely responsible for (a) all compensation, benefits and other employer obligations in respect of employees of Operator or its Affiliates providing Services under this Agreement, (b) training and oversight of employees of Operator or its Affiliates providing Services under this Agreement and (c) all employment decisions with respect to employees of Operator or its Affiliates providing Services under this Agreement.
ARTICLE VI BUDGET 6.1 Annual Budget. Operator shall prepare and propose an annual budget and a business plan.
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 8 ARTICLE VII COST REIMBURSEMENT 7.1 Cost Reimbursement. From and after the Commencement Date and continuing throughout the Term, Operator shall be entitled to be reimbursed for the following costs incurred by Operator, its Subcontractors, or its Affiliates in performance of the Services:
(a)
Direct Costs. All direct costs of Operator of providing any Service that would not constitute Allocated Costs pursuant to Section 7.1(b), including without limitation: (i) the costs of Operator Personnel performing the Services at the Facility, including travel and relocation expenses where applicable; (ii) any costs incurred by Operator associated with improvements to existing systems, integration into Operator systems, and software programs required to implement Operators Nuclear Management Model and CFAM (Corporate Functional Area Manager) philosophy at each Facility; and (iii) all costs incurred by Operator (including the cost of any Subcontractors) related to materials, services, equipment, Taxes (other than those imposed in respect of income or revenues of Operator) and other expenditures (as an agent of the Owner) that are required in the good faith judgment of Operator to operate the Facility in accordance with Good Utility Practice, in each case as described in Exhibit A (such costs collectively, the Direct Costs). The Direct Costs will be allocated on a basis consistent with Operators similar costs as allocated to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time).
(b)
Allocated Costs. All Allocated Costs based on the INPO Allocation Method, calculated based on the Facility being part of Operators Fleet as described in Exhibit A; provided that such allocation is non-discriminatory and on a basis consistent with Operators allocation of similar costs as invoiced to other nuclear facilities in Operators Fleet (as such costs are in effect from time to time). For avoidance of doubt, certain personnel-related reimbursements may be classified as Allocated Costs, including the travel and relocation expenses of certain personnel. For the avoidance of doubt, in no event shall Allocated Costs include any item to the extent such item is also invoiced as a Direct Cost.
7.2 Tracking Costs. Operator shall track all Direct Costs and Allocated Costs (together the Reimbursable Costs) incurred by Operator in operating the Facility.
Notwithstanding any other provision in this Agreement, all costs associated with Decommissioning the Facility are the responsibility of Owner and, to the extent such costs are allowed by Applicable Law to be reimbursed from any Decommissioning trust funds maintained for the Facility, shall be paid for from such funds.
ARTICLE VIII TAXES 8.1 Taxes. Each Party shall be responsible for all Taxes to which it is subject, which Taxes arise out of or are in any way connected with this Agreement. If, under Applicable Law, Operator is required to collect any such Taxes from Owner, Operator shall settle the collection of such Taxes by intercompany accounting.
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 9 ARTICLE IX INSURANCE 9.1 Operator Insurance. Operator shall procure and maintain insurance coverage during the Term in the type and amount consistent with insurance covering Operators Fleet and in accordance with Good Utility Practice.
ARTICLE X TERMINATION 10.1 Termination. During the Term, this Agreement may be terminated by Owner, at its discretion, provided that Owner obtains all required Governmental Approvals required to transfer operation of the Facility to Owner or another Person selected by Owner. Operator shall continue to perform all Services contemplated by this Agreement until Owner has secured all such required Governmental Approvals, including approval from the NRC.
10.2 Actions upon Termination. Prior to the effective date of any termination under this Article X, the Parties shall work in good faith to ensure a satisfactory transfer of responsibility in process and cooperate to obtain all Governmental Approvals (if any and to the extent allowed) required for such transfer. Upon a termination in accordance with Section 10.1, Operator shall:
(a) discontinue performance of the Services on the date agreed upon by the parties (the Termination Date),
(b) place no further orders or enter into any Subcontracts for items or Services unless required for standby, demobilization, remobilization or as otherwise provided in this Article 10; (c) subject to the terms of this Agreement, cooperate with Owner in the transfer to Owner of items or information and disposition of the Services in progress; (d) inventory and turn over to Owner all equipment and materials purchased by Operator and reimbursed by Owner in accordance with the terms of this Agreement and any other equipment or other items provided by Owner for performance of the terminated or suspended Services; (e) cooperate with Owner and their agents and representatives in the turnover of the Services and transition of the employees, as appropriate, to Owner (or their designated successor Operator in the event of termination) who shall provide operational support services for the Facility; and (f) up to and including the Termination Date, Operator shall continue to perform the Services hereunder in accordance with Good Utility Practices and in accordance with the terms of this Agreement; provided that Operator shall be entitled to and shall collect all compensation in accordance with this Agreement (including Reimbursable Costs payable under the terms of this Agreement and any additional reasonable out-of-pocket costs incurred in
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 10 providing transition assistance to Owner or their successor Operator during such time) through intercompany accounting.
10.3 Post-Termination Transition Period. Owners right to use the IP will automatically cease at the Termination Date; provided that Owner will be entitled to continue to use the IP on a transitional period for a period of 12 months following the Termination Date (such period, the Transition Period) to the extent necessary to provide an orderly transition off of Operators systems and software platforms. During the Transition Period, Operator shall cooperate and provide reasonable assistance to Owner in effecting such IP transition; provided that Owner reimburses Operator for Operators actual cost of providing such transition services and permitting continued use of IP, determined in the same manner that costs are allocated and charged pursuant to Article VII of this Agreement.
ARTICLE XI RECORDS In accordance with its standard corporate practices, Operator will at all times operate a system of accounting and maintain complete and accurate records and supporting documentation in relation to the performance of its obligations under this Agreement, provided that documentation related to the provision and performance of the Services shall be maintained for the greater of five years or as required by Applicable Law. Operator shall collaborate with and assist Owner to operate a system of accounting and maintain complete and accurate records in relation to the operation of the Facility, including Services rendered by Operator (the Records). The intent is for the Records to be in accordance with Good Utility Practice to ensure that the Records will be at least sufficient to enable Owner and/or their authorized representatives to conduct thorough operational, technical, and regulatory audits related to the Facility. The Records will be maintained for the greater of (a) Operators document retention program requirements or (b) as is required by Applicable Laws.
ARTICLE XII MISCELLANEOUS 12.1 Notices. Any notice pertaining to this Agreement shall be in writing and sent via facsimile transmittal, registered or certified mail (postage prepaid), hand delivery or by commercial overnight courier, to the other Party, at its respective address designated in this Agreement as set forth below. Each Party shall have the right to change the contact information set forth herein by sending a similar notice to the other Party in like manner. Notices, demands, offers or other written instruments shall be deemed to have been duly given on the date actually received by the intended recipient.
If to Operator:
Constellation Energy Generation, LLC 4300 Winfield Road Warrenville, Illinois 60555 Attn: Chief Nuclear Officer
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 11 Fax: 630-657-4323 If to Owner:
R.E. Ginna Nuclear Power Plant, LLC 1503 Lake Road Ontario, New York 14519 Attn: Site Vice President Fax: 585-771-3392 12.2 Complete Agreement. This Agreement sets forth the entire understanding of the Parties and supersedes any and all prior agreements, arrangements, or understandings relating to the subject matter hereof.
12.3 Construction of Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement.
12.4 Amendments. The terms of this Agreement shall be modified only by a written document signed by an authorized representative of each Party, which authorizes a change in this Agreement. No purported oral modification, waiver, or rescission of this Agreement by an employee or agent of any Party shall operate as a modification, waiver, or rescission of any of the provisions of this Agreement. No course of prior dealing, usage of trade, and course of performance shall be used to modify, supplement, or explain any terms of this Agreement. In addition, to the extent required by the NRC Facility license, written consent from the NRC may also be required.
12.5 No Third Party Beneficiaries. A person who is not a Party to this Agreement may not enforce any of its terms and the provisions of this Agreement are intended for the sole benefit of Owner and Operator and there are no third party beneficiaries hereof, other than their permitted successors and assigns pursuant to the relevant provisions hereof.
12.6 Governing Law; Interpretation; Severability. This Agreement shall be interpreted, governed and construed in accordance with the laws of the Commonwealth of Pennsylvania, and excluding any conflict of laws rule or principle that might refer the governance or the construction of this Agreement to the law of another jurisdiction. The provisions of this Agreement shall be interpreted where possible in a manner to sustain their legality and enforceability. The unenforceability of any provision of this Agreement in a specific situation shall not affect the enforceability of that provision in another situation or the remaining provisions of this Agreement. Subject to the terms of this Agreement, the Parties shall have all rights and remedies at law or in equity.
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC Page 12 12.7 Assignment. No Party may assign its right, title, and interest in this Agreement to any other Person without the prior written consent of the other Party.
12.8 Execution; Counterparts. This Agreement shall not be binding or effective until properly executed by each Party. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which shall constitute one and the same Agreement, and it shall not be necessary in making proof of this Agreement to produce or account for more than one such fully executed counterpart.
12.9 Survival. The following Articles and Sections shall survive termination of this Agreement: Articles VIII and IX in addition to any other provisions which by their nature should, or by their express terms do, survive or extend beyond the Term of this Agreement.
12.10 Waiver. Either Partys waiver of any breach or failure to enforce any of the terms, covenants, conditions, or other provisions of this Agreement at any time shall not in any way affect, limit, modify, or waive that Partys right thereafter to enforce or compel strict compliance with every term, covenant, condition, or other provision hereof, any course of dealing or custom of the trade notwithstanding. All waivers of any term, covenant, condition or other provision of this Agreement must be given in writing.
Nuclear Operating Services Agreement R.E. Ginna Nuclear Power Plant, LLC OPERATOR: Constellation Energy Generation, LLC By:
Name: Bryan Hanson
Title:
Executive Vice President & Chief Generation Officer OWNER: R.E. Ginna Nuclear Power Plant, LLC By:
Name: Bryan Hanson
Title:
Senior Vice President
Nuclear Operating Services Agreement - Exhibit A R.E. Ginna Nuclear Power Plant, LLC Page 1 EXHIBIT A Characterization of Costs For avoidance of doubt, the Services may include, but will not be limited to, those described under the subheadings below:
The following corporate nuclear support functions at Operators Nuclear Division will be allocated costs through the INPO formula as Nuclear Corporate Services Chief Nuclear Officer and staff Nuclear oversight Nuclear human resources o Talent development o Recruiting Labor relations Engineering and technical services governance and oversight o Programs and design engineering o Nuclear fuel procurement o Project management o Asset management Operational support services governance and oversight o Operations oversight and nuclear duty office o Maintenance and work management o Radiation protection, chemistry and environmental o Industrial safety o Training Outage services o Reactor and turbine maintenance o Inspection services o Vendor alliance management o Outage planning and scheduling Decommissioning and spent fuel management Security Emergency preparedness Nuclear finance and accounting o Financial reports o Business planning Licensing and regulatory o Common regulatory and industry fees o Government affairs Payroll and associated employee costs and benefits of allocated employees
Nuclear Operating Services Agreement - Exhibit A R.E. Ginna Nuclear Power Plant, LLC Page 2 Travel and living for business expenses of allocated employees Facility rent and utilities The following nuclear support functions will be performed at the Site and be direct costs Payroll and associated site employee costs and benefits Travel and living for business expenses of site employees Materials, parts, equipment and chemicals Service contracts performed at the site Waste disposal Outage services Facility cost The following Nuclear Services will not be performed at the Site and will be direct costs Corporate managed site specific projects (e.g. license amendments, large equipment replacements)
Nuclear fuel design and analysis Financial support for financial reports and reporting Roving outage services support The following administrative functions will be allocated costs through the INPO formula as Nuclear Corporate Services Strategic supply and procurement IT support and development for fleet wide systems and equipment Payroll and accounts payable processing General legal support Benefits administration The following administrative functions will be performed at the Site and will be direct costs IT staff and equipment Supply procurement and materials management functions Communications staff Human resources The following administrative functions will not be performed at the Site and will be direct costs Legal support on specific matters relating to a site Property tax negotiation Labor negotiations
Nuclear Operating Services Agreement - Exhibit A R.E. Ginna Nuclear Power Plant, LLC Page 3 Corporate managed site-specific projects
Constellation Energy Generation, LLC Support Agreement with Calvert Cliffs Nuclear Power Plant, LLC
EXECUTION VERSION SUPPORT AGREEMENT Between Constellation Energy Generation, LLC And Calvert Cliffs Nuclear Power Plant, LLC THIS SUPPORT AGREEMENT (this Agreement), dated as of February 1, 2022 between Constellation Energy Generation, LLC (Parent) and Calvert Cliffs Nuclear Power Plant, LLC (the Subsidiary Licensee)
WITNESSETH:
WHEREAS, Parent is the direct or indirect owner of 100% of the equity of Subsidiary Licensee; WHEREAS, the Subsidiary Licensee is a corporate entity that is licensed by the Nuclear Regulatory Commission (NRC) to possess and own the Calvert Cliffs Nuclear Power Plant Unit 1 and Unit 2 (the Facility);
WHEREAS, Parent and the Subsidiary Licensee desire to take certain actions to assure the ability of the Subsidiary Licensee to pay the approved expenses of maintaining the Facility safely and reliably and of protecting the public health and safety (the Operating Expenses) and to meet NRC requirements during the operating life of the Facility (the NRC Requirements);
WHEREAS, to the extent and in the event that revenues from the sale of electricity from the Facility are insufficient to cover Operating Expenses and NRC Requirements, then Parent has agreed to provide credit to the Subsidiary Licensee, in the manner as described below, to allow the Subsidiary Licensee to meet its financial assurance obligations as owner of the Facility to protect public health and safety.
Now, THEREFORE, in consideration of the mutual promises herein contained, the parties hereto agree as follows:
Support Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 2
- 1.
Availability of Funding. Parent shall provide or cause to be provided to the Subsidiary Licensee such funds as are necessary to pay Operating Expenses or meet NRC Requirements; provided, however, that Parents maximum liability to provide funding hereunder shall not exceed $126 million cumulatively over the life of this Agreement, unless, and to the extent that, funds provided under this Agreement have been reimbursed in whole or part through repayments or intercompany accounting by the Subsidiary Licensee to Parent. As such, the aggregate amount outstanding under this Agreement at any one time shall not exceed $126 million, and this shall be the maximum unreimbursed amount Parent is obligated to provide under this Agreement or otherwise.
- 2.
Providing Funds. If the revenues generated by the Facility, at any time, are not sufficient to allow the Subsidiary Licensee as owner to meet Operating Expenses or NRC Requirements, Parent will provide to Subsidiary Licensee funds under this Agreement on a timely basis in order to permit Subsidiary Licensee as owner of the Facility to meet Operating Expenses and NRC Requirements.
- 3.
Substitution. Parent can terminate funding provided under this Agreement upon forty-five (45) days' written notice to the Subsidiary Licensee if Parent has procured a substitute loan facility and/or letter of credit for the Subsidiary Licensee that meets the financial assurance requirements of the NRC to protect the public health and safety and has provided notice to and obtained written consent from the NRC, Director of the Office of Nuclear Reactor Regulation.
- 4.
Interest. Interest on any principal amount outstanding shall accrue daily at such rate, and shall be payable at such times, as established by Parent at the time of providing funds under this Agreement. The interest rate applicable to such funds and the time of payment shall be noted in a note, accounting records or other agreed upon form.
Such notation shall be conclusive absent manifest error.
- 5.
Optional Prepayments. The Subsidiary Licensee, at its option, may repay all or any part of the principal amount outstanding from time to time without penalty or premium, by intercompany accounting or other agreed upon form; provided, however, that if the interest rate is LIBOR based, a prepayment penalty may be assessed against the Subsidiary Licensee. Any prepayment penalty would be established by Parent at the time of an advance.
- 6.
Use of Proceeds. In order to provide financial assurance, any funds provided under this Agreement may be used by the Subsidiary Licensee only to meet approved
Support Agreement Calvert Cliffs Nuclear Power Plant, LLC Page 3 Operating Expenses and NRC Requirements, including payments for nuclear property damage insurance and a retrospective premium pursuant to Title 10, Part 140, Section 21 of the Code of Federal Regulations (10 CFR 140.21).
- 7.
No Guarantee. This Agreement is not, and nothing herein contained, and no action taken pursuant hereto by Parent shall be construed as, or deemed to constitute, a direct or indirect guarantee by Parent to any person of the payment of the Operating Expenses or of any liability or obligation of any kind or character whatsoever of the Subsidiary Licensee. This Agreement may, however, be relied upon by the NRC in determining the financial qualifications of the Subsidiary Licensee to be the direct Facility owner.
- 8.
Waivers. Parent hereby waives any failure or delay on the part of the Subsidiary Licensee in asserting or enforcing any of its rights or in making any claims or demands hereunder.
- 9.
Amendments and Termination. This Agreement may not be amended or modified at any time without written consent from the NRC, Director of the Office of Nuclear Reactor Regulation. This Agreement shall terminate at such time as Parent is no longer the direct or indirect owner of any of the shares or other ownership interests in the Subsidiary Licensee. This Agreement shall also terminate with respect to the Operating Expenses and NRC Requirements applicable to the Facility whenever the Facility permanently ceases commercial operations and certification is made as to the permanent removal of fuel from the reactor vessel; provided, however, that this Agreement may be extended for successive periods of two years each upon the mutual agreement of the parties.
- 10. Successors. This Agreement shall be binding upon the parties hereto and their respective successors and assigns.
- 11. Third Parties. Except as expressly provided in Sections 3, 6 and 7 with respect to the NRC, this Agreement is not intended for the benefit of any person other than the parties hereto, and shall not confer or be deemed to confer upon any other such person any benefits, rights, or remedies hereunder.
- 12. Governing Law. This Agreement shall be governed by the laws of the Commonwealth of Pennsylvania. Each party waives it rights to a jury trial in any litigation involving this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their respective officers thereunto duly authorized as of the day and year first above written.
ACKNOWLEDGED AND AGREED Constellation Energy Generation, LLC Calvert Cliffs Nuclear Power Plant, LLC By:
By: _______________________________
Name: Bryan Hanson Name: Bryan Hanson
Title:
EVP & Chief Generation Officer
Title:
Senior Vice President
Constellation Energy Generation, LLC Support Agreement with Constellation FitzPatrick, LLC
EXECUTION VERSION SUPPORT AGREEMENT Between Constellation Energy Generation, LLC And Constellation FitzPatrick, LLC THIS SUPPORT AGREEMENT (this Agreement), dated as of February 1, 2022 between Constellation Energy Generation, LLC (Parent) and Constellation FitzPatrick, LLC (the Subsidiary Licensee)
WITNESSETH:
WHEREAS, Parent is the direct or indirect owner of 100% of the equity of Subsidiary Licensee; WHEREAS, the Subsidiary Licensee is a corporate entity that is licensed by the Nuclear Regulatory Commission (NRC) to possess and own the James A. FitzPatrick Nuclear Power Plant Unit 1 (the Facility);
WHEREAS, Parent and the Subsidiary Licensee desire to take certain actions to assure the ability of the Subsidiary Licensee to pay the approved expenses of maintaining the Facility safely and reliably and of protecting the public health and safety (the Operating Expenses) and to meet NRC requirements during the operating life of the Facility (the NRC Requirements);
WHEREAS, to the extent and in the event that revenues from the sale of electricity and zero-emissions credits under the New York Clean Energy Standard program, if applicable, from the Facility are insufficient to cover Operating Expenses and NRC Requirements, then Parent has agreed to provide credit to the Subsidiary Licensee, in the manner as described below, to allow the Subsidiary Licensee to meet its financial assurance obligations as owner of the Facility to protect public health and safety.
Now, THEREFORE, in consideration of the mutual promises herein contained, the parties hereto agree as follows:
Support Agreement Constellation FitzPatrick, LLC Page 2
- 1.
Availability of Funding. Parent shall provide or cause to be provided to the Subsidiary Licensee such funds as are necessary to pay Operating Expenses or meet NRC Requirements; provided, however, that Parents maximum liability to provide funding hereunder shall not exceed $85 million cumulatively over the life of this Agreement, unless, and to the extent that, funds provided under this Agreement have been reimbursed in whole or part through repayments or intercompany accounting by the Subsidiary Licensee to Parent. As such, the aggregate amount outstanding under this Agreement at any one time shall not exceed $85 million, and this shall be the maximum unreimbursed amount Parent is obligated to provide under this Agreement or otherwise.
- 2.
Providing Funds. If the revenues generated by the Facility, at any time, are not sufficient to allow the Subsidiary Licensee as owner to meet Operating Expenses or NRC Requirements, Parent will provide to Subsidiary Licensee funds under this Agreement on a timely basis in order to permit Subsidiary Licensee as owner of the Facility to meet Operating Expenses and NRC Requirements.
- 3.
Substitution. Parent can terminate funding provided under this Agreement upon forty-five (45) days' written notice to the Subsidiary Licensee if Parent has procured a substitute loan facility and/or letter of credit for the Subsidiary Licensee that meets the financial assurance requirements of the NRC to protect the public health and safety and has provided notice to and obtained written consent from the NRC, Director of the Office of Nuclear Reactor Regulation.
- 4.
Interest. Interest on any principal amount outstanding shall accrue daily at such rate, and shall be payable at such times, as established by Parent at the time of providing funds under this Agreement. The interest rate applicable to such funds and the time of payment shall be noted in a note, accounting records or other agreed upon form.
Such notation shall be conclusive absent manifest error.
- 5.
Optional Prepayments. The Subsidiary Licensee, at its option, may repay all or any part of the principal amount outstanding from time to time without penalty or premium, by intercompany accounting or other agreed upon form; provided, however, that if the interest rate is LIBOR based, a prepayment penalty may be assessed against the Subsidiary Licensee. Any prepayment penalty would be established by Parent at the time of an advance.
Support Agreement Constellation FitzPatrick, LLC Page 3
- 6.
Use of Proceeds. In order to provide financial assurance, any funds provided under this Agreement may be used by the Subsidiary Licensee only to meet approved Operating Expenses and NRC Requirements, including payments for nuclear property damage insurance and a retrospective premium pursuant to Title 10, Part 140, Section 21 of the Code of Federal Regulations (10 CFR 140.21).
- 7.
No Guarantee. This Agreement is not, and nothing herein contained, and no action taken pursuant hereto by Parent shall be construed as, or deemed to constitute, a direct or indirect guarantee by Parent to any person of the payment of the Operating Expenses or of any liability or obligation of any kind or character whatsoever of the Subsidiary Licensee. This Agreement may, however, be relied upon by the NRC in determining the financial qualifications of the Subsidiary Licensee to be the direct Facility owner.
- 8.
Waivers. Parent hereby waives any failure or delay on the part of the Subsidiary Licensee in asserting or enforcing any of its rights or in making any claims or demands hereunder.
- 9.
Amendments and Termination. This Agreement may not be amended or modified at any time without written consent from the NRC, Director of the Office of Nuclear Reactor Regulation. This Agreement shall terminate at such time as Parent is no longer the direct or indirect owner of any of the shares or other ownership interests in the Subsidiary Licensee. This Agreement shall also terminate with respect to the Operating Expenses and NRC Requirements applicable to the Facility whenever the Facility permanently ceases commercial operations and certification is made as to the permanent removal of fuel from the reactor vessel; provided, however, that this Agreement may be extended for successive periods of two years each upon the mutual agreement of the parties.
- 10. Successors. This Agreement shall be binding upon the parties hereto and their respective successors and assigns.
- 11. Third Parties. Except as expressly provided in Sections 3, 6 and 7 with respect to the NRC, this Agreement is not intended for the benefit of any person other than the parties hereto, and shall not confer or be deemed to confer upon any other such person any benefits, rights, or remedies hereunder.
Support Agreement Constellation FitzPatrick, LLC Page 4
- 12. Governing Law. This Agreement shall be governed by the laws of the State of New York. Each party waives it rights to a jury trial in any litigation involving this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their respective officers thereunto duly authorized as of the day and year first above written.
ACKNOWLEDGED AND AGREED Constellation Energy Generation, LLC Constellation FitzPatrick, LLC By:
By: _______________________________
Name: Bryan Hanson Name: Bryan Hanson
Title:
EVP & Chief Generation Officer
Title:
President
Constellation Energy Generation, LLC Support Agreement with Nine Mile Point Nuclear Station, LLC
EXECUTION VERSION SUPPORT AGREEMENT Between Constellation Energy Generation, LLC And Nine Mile Point Nuclear Station, LLC THIS SUPPORT AGREEMENT (this Agreement), dated as of February 1, 2022 between Constellation Energy Generation, LLC (Parent) and Nine Mile Point Nuclear Station, LLC (the Subsidiary Licensee)
WITNESSETH:
WHEREAS, Parent is the direct or indirect owner of 100% of the equity of Subsidiary Licensee; WHEREAS, the Subsidiary Licensee is a corporate entity that is licensed by the Nuclear Regulatory Commission (NRC) to possess and own a 100% interest in Nine Mile Point Unit 1 and an 82% interest in Nine Mile Point Unit 2 (Unit 1 (the Facility);
WHEREAS, Parent and the Subsidiary Licensee desire to take certain actions to assure the ability of the Subsidiary Licensee to pay the approved expenses of maintaining the Facility safely and reliably and of protecting the public health and safety (the Operating Expenses) and to meet NRC requirements during the operating life of the Facility (the NRC Requirements);
WHEREAS, to the extent and in the event that revenues from the sale of electricity and zero-emissions credits under the New York Clean Energy Standard program, if applicable, from the Facility are insufficient to cover Operating Expenses and NRC Requirements, then Parent has agreed to provide credit to the Subsidiary Licensee, in the manner as described below, to allow the Subsidiary Licensee to meet its financial assurance obligations as owner of the Facility to protect public health and safety.
Now, THEREFORE, in consideration of the mutual promises herein contained, the parties hereto agree as follows:
Support Agreement Nine Mile Point Nuclear Station, LLC Page 2
- 1.
Availability of Funding. Parent shall provide or cause to be provided to the Subsidiary Licensee such funds as are necessary to pay Operating Expenses or meet NRC Requirements; provided, however, that Parents maximum liability to provide funding hereunder shall not exceed $128 million cumulatively over the life of this Agreement, unless, and to the extent that, funds provided under this Agreement have been reimbursed in whole or part through repayments or intercompany accounting by the Subsidiary Licensee to Parent. As such, the aggregate amount outstanding under this Agreement at any one time shall not exceed $128 million, and this shall be the maximum unreimbursed amount Parent is obligated to provide under this Agreement or otherwise.
- 2.
Providing Funds. If the revenues generated by the Facility, at any time, are not sufficient to allow the Subsidiary Licensee as owner to meet Operating Expenses or NRC Requirements, Parent will provide to Subsidiary Licensee funds under this Agreement on a timely basis in order to permit Subsidiary Licensee as owner of the Facility to meet Operating Expenses and NRC Requirements.
- 3.
Substitution. Parent can terminate funding provided under this Agreement upon forty-five (45) days' written notice to the Subsidiary Licensee if Parent has procured a substitute loan facility and/or letter of credit for the Subsidiary Licensee that meets the financial assurance requirements of the NRC to protect the public health and safety and has provided notice to and obtained written consent from the NRC, Director of the Office of Nuclear Reactor Regulation.
- 4.
Interest. Interest on any principal amount outstanding shall accrue daily at such rate, and shall be payable at such times, as established by Parent at the time of providing funds under this Agreement. The interest rate applicable to such funds and the time of payment shall be noted in a note, accounting records or other agreed upon form.
Such notation shall be conclusive absent manifest error.
- 5.
Optional Prepayments. The Subsidiary Licensee, at its option, may repay all or any part of the principal amount outstanding from time to time without penalty or premium, by intercompany accounting or other agreed upon form; provided, however, that if the interest rate is LIBOR based, a prepayment penalty may be assessed against the Subsidiary Licensee. Any prepayment penalty would be established by Parent at the time of an advance.
- 6.
Use of Proceeds. In order to provide financial assurance, any funds provided under this Agreement may be used by the Subsidiary Licensee only to meet approved
Support Agreement Nine Mile Point Nuclear Station, LLC Page 3 Operating Expenses and NRC Requirements, including payments for nuclear property damage insurance and a retrospective premium pursuant to Title 10, Part 140, Section 21 of the Code of Federal Regulations (10 CFR 140.21).
- 7.
No Guarantee. This Agreement is not, and nothing herein contained, and no action taken pursuant hereto by Parent shall be construed as, or deemed to constitute, a direct or indirect guarantee by Parent to any person of the payment of the Operating Expenses or of any liability or obligation of any kind or character whatsoever of the Subsidiary Licensee. This Agreement may, however, be relied upon by the NRC in determining the financial qualifications of the Subsidiary Licensee to be the direct Facility owner.
- 8.
Waivers. Parent hereby waives any failure or delay on the part of the Subsidiary Licensee in asserting or enforcing any of its rights or in making any claims or demands hereunder.
- 9.
Amendments and Termination. This Agreement may not be amended or modified at any time without written consent from the NRC, Director of the Office of Nuclear Reactor Regulation. This Agreement shall terminate at such time as Parent is no longer the direct or indirect owner of any of the shares or other ownership interests in the Subsidiary Licensee. This Agreement shall also terminate with respect to the Operating Expenses and NRC Requirements applicable to the Facility whenever the Facility permanently ceases commercial operations and certification is made as to the permanent removal of fuel from the reactor vessel; provided, however, that this Agreement may be extended for successive periods of two years each upon the mutual agreement of the parties.
- 10. Successors. This Agreement shall be binding upon the parties hereto and their respective successors and assigns.
- 11. Third Parties. Except as expressly provided in Sections 3, 6 and 7 with respect to the NRC, this Agreement is not intended for the benefit of any person other than the parties hereto, and shall not confer or be deemed to confer upon any other such person any benefits, rights, or remedies hereunder.
- 12. Governing Law. This Agreement shall be governed by the laws of the State of New York. Each party waives it rights to a jury trial in any litigation involving this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their respective officers thereunto duly authorized as of the day and year first above written.
ACKNOWLEDGED AND AGREED Constellation Energy Generation, LLC Nine Mile Point Nuclear Station, LLC By:
By: _______________________________
Name: Bryan Hanson Name: Bryan Hanson
Title:
EVP & Chief Generation Officer
Title:
Senior Vice President
Constellation Energy Generation, LLC Support Agreement with R. E. Ginna Nuclear Power Plant, LLC
EXECUTION VERSION SUPPORT AGREEMENT Between Constellation Energy Generation, LLC And R.E. Ginna Nuclear Power Plant, LLC THIS SUPPORT AGREEMENT (this Agreement), dated as of February 1, 2022 between Constellation Energy Generation, LLC (Parent) and R.E. Ginna Nuclear Power Plant, LLC (the Subsidiary Licensee)
WITNESSETH:
WHEREAS, Parent is the direct or indirect owner of 100% of the equity of Subsidiary Licensee; WHEREAS, the Subsidiary Licensee is a corporate entity that is licensed by the Nuclear Regulatory Commission (NRC) to possess and own R.E. Nuclear Power Plant Unit 1 (the Facility);
WHEREAS, Parent and the Subsidiary Licensee desire to take certain actions to assure the ability of the Subsidiary Licensee to pay the approved expenses of maintaining the Facility safely and reliably and of protecting the public health and safety (the Operating Expenses) and to meet NRC requirements during the operating life of the Facility (the NRC Requirements);
WHEREAS, to the extent and in the event that revenues from the sale of electricity and zero-emissions credits under the New York Clean Energy Standard program, if applicable, from the Facility are insufficient to cover Operating Expenses and NRC Requirements, then Parent has agreed to provide credit to the Subsidiary Licensee, in the manner as described below, to allow the Subsidiary Licensee to meet its financial assurance obligations as owner of the Facility to protect public health and safety.
Now, THEREFORE, in consideration of the mutual promises herein contained, the parties hereto agree as follows:
Support Agreement R.E. Ginna Nuclear Power Plant, LLC Page 2
- 1.
Availability of Funding. Parent shall provide or cause to be provided to the Subsidiary Licensee such funds as are necessary to pay Operating Expenses or meet NRC Requirements; provided, however, that Parents maximum liability to provide funding hereunder shall not exceed $118 million cumulatively over the life of this Agreement, unless, and to the extent that, funds provided under this Agreement have been reimbursed in whole or part through repayments or intercompany accounting by the Subsidiary Licensee to Parent. As such, the aggregate amount outstanding under this Agreement at any one time shall not exceed $118 million, and this shall be the maximum unreimbursed amount Parent is obligated to provide under this Agreement or otherwise.
- 2.
Providing Funds. If the revenues generated by the Facility, at any time, are not sufficient to allow the Subsidiary Licensee as owner to meet Operating Expenses or NRC Requirements, Parent will provide to Subsidiary Licensee funds under this Agreement on a timely basis in order to permit Subsidiary Licensee as owner of the Facility to meet Operating Expenses and NRC Requirements.
- 3.
Substitution. Parent can terminate funding provided under this Agreement upon forty-five (45) days' written notice to the Subsidiary Licensee if Parent has procured a substitute loan facility and/or letter of credit for the Subsidiary Licensee that meets the financial assurance requirements of the NRC to protect the public health and safety and has provided notice to and obtained written consent from the NRC, Director of the Office of Nuclear Reactor Regulation.
- 4.
Interest. Interest on any principal amount outstanding shall accrue daily at such rate, and shall be payable at such times, as established by Parent at the time of providing funds under this Agreement. The interest rate applicable to such funds and the time of payment shall be noted in a note, accounting records or other agreed upon form.
Such notation shall be conclusive absent manifest error.
- 5.
Optional Prepayments. The Subsidiary Licensee, at its option, may repay all or any part of the principal amount outstanding from time to time without penalty or premium, by intercompany accounting or other agreed upon form; provided, however, that if the interest rate is LIBOR based, a prepayment penalty may be assessed against the Subsidiary Licensee. Any prepayment penalty would be established by Parent at the time of an advance.
- 6.
Use of Proceeds. In order to provide financial assurance, any funds provided under this Agreement may be used by the Subsidiary Licensee only to meet approved
Support Agreement R.E. Ginna Nuclear Power Plant, LLC Page 3 Operating Expenses and NRC Requirements, including payments for nuclear property damage insurance and a retrospective premium pursuant to Title 10, Part 140, Section 21 of the Code of Federal Regulations (10 CFR 140.21).
- 7.
No Guarantee. This Agreement is not, and nothing herein contained, and no action taken pursuant hereto by Parent shall be construed as, or deemed to constitute, a direct or indirect guarantee by Parent to any person of the payment of the Operating Expenses or of any liability or obligation of any kind or character whatsoever of the Subsidiary Licensee. This Agreement may, however, be relied upon by the NRC in determining the financial qualifications of the Subsidiary Licensee to be the direct Facility owner.
- 8.
Waivers. Parent hereby waives any failure or delay on the part of the Subsidiary Licensee in asserting or enforcing any of its rights or in making any claims or demands hereunder.
- 9.
Amendments and Termination. This Agreement may not be amended or modified at any time without written consent from the NRC, Director of the Office of Nuclear Reactor Regulation. This Agreement shall terminate at such time as Parent is no longer the direct or indirect owner of any of the shares or other ownership interests in the Subsidiary Licensee. This Agreement shall also terminate with respect to the Operating Expenses and NRC Requirements applicable to the Facility whenever the Facility permanently ceases commercial operations and certification is made as to the permanent removal of fuel from the reactor vessel; provided, however, that this Agreement may be extended for successive periods of two years each upon the mutual agreement of the parties.
- 10. Successors. This Agreement shall be binding upon the parties hereto and their respective successors and assigns.
- 11. Third Parties. Except as expressly provided in Sections 3, 6 and 7 with respect to the NRC, this Agreement is not intended for the benefit of any person other than the parties hereto, and shall not confer or be deemed to confer upon any other such person any benefits, rights, or remedies hereunder.
- 12. Governing Law. This Agreement shall be governed by the laws of the State of New York. Each party waives it rights to a jury trial in any litigation involving this Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their respective officers thereunto duly authorized as of the day and year first above written.
ACKNOWLEDGED AND AGREED Constellation Energy Generation, LLC R.E. Ginna Nuclear Power Plant, LLC By:
By: _______________________________
Name: Bryan Hanson Name: Bryan Hanson
Title:
EVP & Chief Generation Officer
Title:
Senior Vice President